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BALUYOT v. CA
July 22, 1999
Mendoza, J
Luciano, Noel Christian
Procedural case. Idk ano connection nya sa topic.

SUMMARY: Petitioners, residents of Brgy. Cruz-na-Ligas,

Diliman, QC, filed a complaint for specific performance and
damages against UP and the QC Government. UP executed
a Deed of Donation in favor of QC with the residents of the
said barangay as beneficiaries. This is in relation to an
ongoing dispute where the residents asserted ownership
over a lot registered under UPs name. However, UP
revoked the Deed of Donation for alleged non-compliance
by QC of the conditions stated in the Deed. The Petitioners
are seeking the enforcement of the Deed. UP and QC
moved to dismiss the complaint for failure to state a cause
of action. RTC denied but the CA reversed and dismissed
the case. The SC held that the complaint states a cause of
action as the petitioners were enforcing a stipulation pour
autrui.
DOCTRINE: Elements of a cause of action: (1) Right in
favor of plaintiff by whatever means and under whatever
law it arises or is created; (2) Obligation on the part of
defendant to respect or not to violate such right; (3) Act or
omission on the part of defendant in violation of the right
of plaintiff or constituting breach of obligations to plaintiff.
Requisites for stipulation pour autrui: (1) There must
be a stipulation in favor of a third person; (2) Stipulation
must be part, not the whole of the contract; (3) Contracting
parties must have clearly and deliberately conferred a
favor upon a third person, not a mere incidental benefit or
interest; (4) Third person must have communicated his
acceptance to the obligor before its revocation; (5) Neither
of the contracting parties bears the legal representation or
authorization of the third party.

FACTS: Petitioners Baluyot, et al. are residents of Brgy.

Cruz-na-Ligas, Diliman, QC and members of the Cruz-naLigas Homesite Association, a non-stock corporation
composed of residents of Brgy. Cruz-na-Ligas.
Petitioners filed a complaint for specific performance
and damages against the University of the Philippines and
Quezon City Government.
ALLEGATIONS OF THE COMPLAINT:
1. That petitioners and their ascendants are in open,
peaceful, adverse and continuous possession in the
concept of owner since time immemorial of parcel of
land (now Diliman)
a. Members of the Association possessed the rest of
the area
2. That claims of petitioners and the Association have
been the subject of quasi-judicial proceedings and
administrative investigations culminating in 2
Indorsements by the Bureau of Land and Office of the
President
a. Indorsements confirmed the rights of the bona
fide residents to the parcel of land
3. Pursuant to the Indorsements, UP issued a Reply
Indorsement
a. UP Board of Regents approved donation of 9.2
hectares of the site directly to the residents; this
was increased to 15.8 hectares
b. But execution of the legal document failed
because the residents demanded more than 15.8
hectares
4. Association proposed to accept and UP manifested in
writing its consent to the intended donation to the
Association for the benefit of the residents
a. But UP backed out
b. UP then resumed the donation thru QC
Government
5. That there was a pending case (Im assuming its a
land registration case since it is docketed as LRC No.
3151) and the Association amended its complaint:

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a. It demanded specific performance

b. Exclusion from the technical description of UPs
TCT an area of about 42 hectares
c. Association prayed for a writ of preliminary
injunction to restrain UP from donating the area
to QC
6. RTC issued a writ of preliminary injunction
a. UP filed MR
b. Association agreed to the lifting of the order
granting the preliminary injunction after UP made
an assurance in their MR that the donation to QC
will be for the benefit of the residents of Cruz-naLigas
7. UP was not satisfied and demanded the dismissal of
the case
a. It argued that efforts to expedite the
formalization of the Deed of Donation for the
benefit of the residents should not only be preconditioned on the lifting of preliminary injunction
but also the dismissal of the petition
b. It filed another MR
8. Association filed a Comment to the new MR
a. It manifested its willingness to the dismissal of
the case PROVIDED that the area to be donated
THRU QC government be subdivided into lots to
be given to qualified residents together with TCTs
without costs
9. With this manifestation, the RTC dismissed the case
10. UP then executed a Deed of Donation in favor of QC
Government for the benefit of the qualified residents
of Cruz-na-Ligas
a. Under this Deed, 15.8379 hectares were ceded to
QC Government
b. Conditions imposed on QC (among others)
(1) Within 18 months:
(a) Remove the structures built on the
boundaries
(b) Relocation of the families

(c) Construction of fence on boundaries

(d) Construction of drainage canal
(2) After 3 years, QC to transfer to qualified
residents by way of donation the individual
lots occupied by them subject to conditions
imposed by QC
11. QC started complying with the conditions
a. But UP failed to deliver the TCT covering the
property to enable QC to register the Deed so
that a corresponding TCT be issued under its
name
12. After the lapse of 18 months, UP issued Admin Order
No. 21
a. Declared the Deed of Donation revoked
b. Ground: Failure of QC to comply with the
conditions
13. That the revocation and reversion without judicial
declaration is illegal and prejudicial to the rights of
the plaintiffs who are bona fide residents of the Brgy.
MOTION TO DISMISS: UP and QC filed a motion to dismiss
on the ground that the complaint failed to state a cause of
action
RTC DECISION: It denied the Motion to Dismiss. It held that
the complaint shows that it alleges facts entitling the
plaintiffs to acquire ownership over the land by reason of
laches. Trial on the merits is needed
UP and QC filed a petition for certiorari before the CA
CA DECISION: It set aside the RTC order and ordered the
DISMISSAL of the case:
1. Complaint did not allege any claim for annulment of
UPs title over the portion of land concerned or
reconveyance to petitioners

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2. Alleged cause of action based on ownership of

petitioners was tantamount to a collateral attack on
UPs title which is not allowed
3. No acquisition of ownership by laches
Hence, this petition for certiorari
ISSUES:
1. Whether the complaint states a cause of action.
HELD: Yes, there is a cause of action
I.

RTC erred in issuing its order

A. The RTC held:
1. The donation made by UP to QC has already
been revoked so petitioners (for whose benefit
the donation had been made) had no cause of
action for specific performance
2. Motion to dismiss by respondents should be
denied on the ground that UP was barred by
laches from contesting petitioners right to
remain in possession
B. SC Ruling:
1. Laches is a defense against a registered
owner suing to recover possession of the land
registered in its name
a. But UP is not the one suing in this case
b. Petitioners are the one suing
(1) Their
suit
is
mainly
to
seek
enforcement of the deed of donation
made by UP to QC
2. Petitioners do not invoke laches. What they
allege is adverse occupation from time
immemorial
a. They
are
claiming
PRESCRIPTIVE
acquisition
b. But this cannot be since the land is a
registered
land
which
cannot
be
collaterally attacked

II. CA also erred in dismissing the petition on the ground

of failure to state a cause of action
A. Elements of a cause of action:
1. Right in favor of plaintiff by whatever means
and under whatever law it arises or is created
2. Obligation on the part of defendant to respect
or not to violate such right
3. Act or omission on the part of defendant in
violation of the right of plaintiff or constituting
breach of obligations to plaintiff
B. All the elements of a cause of action are present
1. Though the petitioners were not party to the
Deed, they anchor their right to seek
enforcement upon their allegation that they
are intended beneficiaries of the donation
a. Enforcement of a stipulation pour autrui
(1) There must be a stipulation in favor of
a third person;
(2) Stipulation must be part, not the whole
of the contract;
(3) Contracting parties must have clearly
and deliberately conferred a favor
upon a third person, not a mere
incidental benefit or interest;
(4) Third person must have communicated
his acceptance to the obligor before its
revocation;
(5) Neither of the contracting parties bears
the
legal
representation
or
authorization of the third party.
III. Respondents allegation that the complaint alleges
inconsistent causes of action cannot stand
A. Respondents: Petitioners seek the enforcement of
the donation but at the same time seek the
recovery of the land
B. SC: These are not inconsistent but ALTERNATIVE
causes of action
1. This is allowed under the rules

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DISPOSITIVE: CA DECISION REVERSED. REMANDED TO RTC

FOR TRIAL ON THE MERITS