Eden Ballatan and Sps. Betty Martinez and Chong Chy Ling v.

CA
G.R. No. 125683, 02 March 1999, SECOND DIVISION (Puno, J.)
Facts:
In 1985, Eden Ballatan constructed her house on Lot No. 24 in Araneta
University Village, Malabon. During the construction, she noticed that the concrete
fence & side pathway of the adjoining house of Winston Go encroached upon the
entire length of the eastern side of her property. Her building contractor informed
her that the area of her lot was actually less than that described in the title.
Ballatan informed Go about the discrepancy and encroachment, but Go
claimed that his house (including its fence and pathway) were built within the
parameters of his fathers lot.
The owner-developer of the subdivision, Araneta Insitute of Agriculture (AIA)
authorized a survey of the land by Engr. Jose N. Quedding. Quedding found that the
lot area of Ballatan was less by a few meters & that of Li Ching Yao (3 lots away),
increased by 2 meters. He declared that he made a verification survey of the lots
belonging to Go in 1983, and found the boundaries to be in order. However he could
not explain the reduction in Ballatans area.
Engr. Quedding made another relocation survey upon request of the parties.
He found that Lot 24 lost approx.. 25sqm. on its eastern boundary; that Lot 25 did
not lose nor gain any area; that Lot 26 lost around 3 sqm which were however
gained by Lot 27.
On the basis of this survey, Ballatan made a written demand on Go to remove
& dismantle their improvements on Lot No. 24. Go refused, thus Ballatan brought
the issue before the barangay. Go did not appear.
Ballatan filed a case for recovery of possession before the RTC of Malabon.
The Gos filed an answer with third-party complaint, impleading Li Ching Yao, AIA &
Engr. Quedding.
The RTC decided in favor of Ballatan, ordering Go to vacate Lot No. 24 and
demolish their improvements and to pay Ballatan actual damages. It also dismissed
the third-party complaint against AIA, Quedding & Li Ching Yao.
On appeal, the CA modified the decision of the RTC. It ordered Li Ching Yao &
Engr. Quedding to pay Ballatan; and Li Ching Yao to pay Go, a reasonable amount
for that portion of the lot which they encroached the value to be fixed at the time
of taking.
Issues:

1) Is the award of damages proper, despite Gos failure to specify the amount
prayer for & failure to pay the corresponding additional filing fees thereon?
2) Given the fact of encroachment on Ballatans property, what are her rights?
Ruling:
1.
YES, the award of damages is proper.
The third-party complaint in the instant case arose from the complaint of
accion publiciana of Ballatan against Go, which is a real action. In real actions, the
docket & filing fees are based on the value of property & the amount of damages
claimed.
Where the fees prescribed for the real action have been paid, but the fees of
certain related damages are not, the court, although having jurisdiction over the
real action, may not have acquired jurisdiction over the accompanying claim for
damages. Accordingly, the court may expunge those claims for damages, or allow
(on motion) a reasonable time for amendment of the complaint so as to allege the
precise amount of damages & accept payment of the requisite legal fees.
In the instant case, the third-party complaint sought the same remedy as the
principal complaint, but added a prayer for attorneys fees & costs without
specifying their amounts. The additional filing fee on this claim is deemed to
constitute a lien on the judgment award.
2.
The erroneous survey by Engr. Quedding triggered the discrepancies. It was
upon said erroneous survey that Go relied upon in constructing his house on his
fathers land. Otherwise stated, Go had no knowledge that they encroached on
Ballatans lot. They are deemed builders in good faith.
Li Ching Yao built his house on his lot before any of the other parties did.
There is no evidence, much less, any allegation that Li Ching Yao was aware that
when he built his house he knew that a portion thereof encroached on Gos
adjoining land. Good faith is always presumed, & upon him who alleges bad faith on
the part of a possessor rests the burden of proof.
Thus, Ballatan as owner of Lot No. 24, may choose to purchase the
improvement made by Go on their land, or sell to Go the subject portion.
If buying the improvement is impractical as it may render Gos house useless,
then Ballatan may sell to Go that portion of Lot No. 24 on which their improvement
stands. If the Gos are unwilling or unable to buy the lot, then they must vacate the
land and, until they vacate, they must pay rent to Ballatan.

In the event that Ballatan elects to sell to Go the subject portion of their lot,
the price must be fixed at the prevailaing market value at the time of payment. The
time of taking is determinative of just compensation in expropriation proceedings;
clearly the instant case is not one for expropriation.
Ballatan was ordered to decide within 30 days whether to buy the portion of
Gos improvement on Lot 24, or to sell to Go the portion of their land on which the
improvement stands. Engr. Quedding was ordered to pay attorneys fees of P5,000
to Go.