MWSS vs.

CA
Docket Number: GR 126000 Date: October 7, 1998 Ponente: Martinez, J.
Topic: RULE 3 Created by: Lance
Petitioners Respondents
MWSS COURT OF APPEALS, ET. AL.
Facts of the Case
 MWSS leased 128 hectares of its land to Capitol Hills Country Club (“Capitol Hills”) for 25 years,
renewable for 15 years or until 2005 with a stipulation allowing the latter to exercise a right of first
refusal should the property be made open for sale.
 Pursuant to LOI no. 440 issued by P. Marcos, he direct MWSS to cancel its lease agreement with
Capitol Hills for the disposition of the subject property.
 MWSS informed Capitol Hills of its preferential right to buy the subject property which was up for sale.
 After the 2 parties agreed on the purchase of the subject property, P. Marcos later gave his approval.
 Thereafter, MWSS issued a Resolution approving the sale of the subject property in favor of Silhouette
Trading Corp. (STC). And the MWSS-STC sales agreement pushed through lateron.
 Subsequently, STC sold 67 hectares of the subject property to Ayala Corp. for P74Million.
o Ayala developed the land it purchased into a prime residential area known as Ayala Hieights
Subdivision.
 A decade later, MWSS filed an action against AYALA, STC, Capital Hills before the RTC QC seeking
for the declaration of nullity of the MWSS-STC sales agreement and all subsequent conveyances
involving the subject property.
 AYALA filed its answer pleading one of the affirmative defenses of non-joinder of the indispensable
parties.
 RTC issued an Order:
o Dismissing MWSS’ complaint due to, among others, non-joinder of indispensable parties.
 On appeal to the CA, it rendered a Decision:
o Affirmed the order of the RTC.
Issues Ruling

 W/N CA erred in dismissing the petition of MWSS NO

Rationale/Analysis/Legal Basis
 It is well established that owners of property over which reconveyance is asserted are indispensable
parties without whom no relief is available and without whom the court can render no valid judgment.
 Being indispensable parties, the absence of these lot-owners in the suit renders all subsequent actions
of the trial court null and void for want of authority to act, not only as to the absent parties but even as to
those present.
 Therefore, when indispensable parties are not before the court, the action should be dismissed.
 MWSS’ action against AYALA INC. et.al, for the recovery of the subject property now converted into a
residential subdivision would affect the proprietary rights of the many lot owners to whom the land has
already been parceled out. They should have been included in the suit as parties-defendants.
Disposition
WHEREFORE, in view of the foregoing, the consolidated petitions are hereby DISMISSED