Enriquez Vda De Santiago vs. Vilar CASE DIGEST - Civil Procedure - Indispensable Party - Transfer of Interest

Enriquez Vda De Santiago vs. Vilar

Facts: Spouses Zulueta, registered owners of several parcels of land, obtained loans amounting to 3.1m to the GSIS. This was secured by the titles. The lot was divided into 199 lots. 78 of these lots were excluded from the mortgage. Spouses failed to pay. GSIS became the owner. GSIS, however, consolidated its title on all of the three mother titles, including the 78 lots which were expressly excluded from the mortgage contract. Later, it began to dispose the foreclosed lots, including those not covered by the foreclosure sale.

Spouses were succeeded by Antonio, who transferred all his rights and interests in the lots to Santiago. Antonio, as represented by Eduardo, filed an Action for Reconveyance of the excluded lots against the GSIS. Eduardo died and was substituted by his widow, herein petitioner Rosario.
RTC ordered GSIS to reconvey to Rosario the excluded lots or to pay the market value of said lots in case reconveyance is not possible. CA affirmed RTC. Vilar filed Motion for Substitution before the RTC. He alleged that after Antonio transferred his rights and interests to Eduardo, the latter assigned to Vilar 90% of his interest in the judgment proceeds of the reconveyance case.
RTC in merely noted Vilar's motion. CA impleaded Vilar as party-plaintiff in substitution of Rosario
Rosario is an indispensable party in the petition before the CA as she is the widow of the original party-plaintiff Eduardo. The RTC in merely noting and not granting his motion would necessarily affect her interest in the subject matter of litigation as the party-plaintiff. Rosario's failure to participate in the proceedings before the CA constitutes a denial of her constitutional right to due process. Hence, failure to implead Rosario as an indispensable party rendered all the proceedings before the CA null and void for want of authority to act.
An indispensable party is a party-in-interest without whom no final determination can be had of an action, and who shall be joined either as plaintiffs or defendants. It is a party whose interest will be affected by the court's action in the litigation. The joinder of indispensable parties is mandatory. The presence of indispensable parties is necessary to vest the court with jurisdiction, which is the authority to hear and determine a cause, the right to act in a case. Thus, without the presence of indispensable parties to a suit or proceeding, judgment of a court cannot attain real finality.

Issue: WON the CA erred in impleading Vilar as party-plaintiff in substitution of Rosario.

Held: Yes. The assignment of rights to Vilar was set aside by the court for being belatedly filed.