1. G.R. No.

102909

September 6, 1993

SPOUSES VICENTE and LOURDES PINGOL, petitioners, vs. HON. COURT OF APPEALS and HEIRS OF FRANCISCO N. DONASCO, namely: MELINDA D. PELAYO, MARIETTA D. SINGSON, MYRNA D. CUEVAS, NATIVIDAD D. PELAYO, YOLANDA D. CACERES and MARY DONASCO, respondents. DAVIDE, JR., J.: An action denominated as one for specific performance and damages was brought by the private respondents against the petitioners before the Regional Trial Court (RTC) of Caloocan City which, after due trial, rendered a decision in favor of the petitioners. On appeal, the respondent Court reversed the trial court's decision. It is from this judgment that the petitioners have appealed to this Court by way of a petition for review on certiorari. The material facts of this case are simple and undisputed. Petitioner Vicente Pingol is the owner of Lot No. 3223 of the Cadastral Survey of Caloocan, with an area of 549 square meters, located at Bagong Barrio, Caloocan City and more particularly described in Transfer Certificate of Title (TCT) No. 7435 of the Registry of Deeds of Caloocan City. On 17 February 1969, he executed a "DEED OF ABSOLUTE SALE OF ONE-HALF OF (1/2) [OF] AN UNDIVIDED PORTION OF A PARCEL OF LAND" in favor of Francisco N. Donasco which was acknowledged before a notary public. The parcel of land referred to herein is Lot No. 3223 and the pertinent portions of the document read as follows: That for and in consideration of the sum of TWENTY THOUSAND AND FIVE HUNDRED THIRTY (P20,530.00) PESOS, Philippine Currency, the VENDOR hereby these presents SELL, CONVEY AND CONVEY by way of Absolute Sale the one-half (1/2) portion, equivalent to Two Hundred Seventy Four and point Fifty (274.50) square meters, to VENDEE, the above-mentioned property, his heirs, assigns and successors-in- interest; That the VENDOR hereby confesses and acknowledges the receipt of TWO THOUSAND (P2,000.00) PESOS from VENDEE as advanced (sic) and partial payment to the above-cited consideration of the Sale herein mentioned, leaving therefor a balance of Eighteen Thousand and Five Hundred Thirty (P18,530) Pesos to be paid in several equal installments within a period of six (6) years, beginning January, 1970; That after computing the above-mentioned equal installments, the VENDEE agrees and undertakes to pay unto the VENDOR a monthly amount equivalent to Two Hundred Fifty Seven ( sic) and Thirty Six Centavos (P257.36) within a period of Seventy One (71) months and on the Seven Two [ sic] (72) month, the amount of (P257.44) as the last and final installment thereof; That the VENDEE agrees that in case of default in the payment of the installment due the same shall earn a legal rate of interest, and to which the VENDOR likewise agrees; That the VENDEE undertakes to pay unto the VENDOR the herein monthly installment within the first five (5) days of each month and the same shall be made available and to be paid at the residence of the VENDOR, payment to be made either directly to the VENDOR, his wife or his authorized representative or factor; That in case of partition of the above-described property between herein VENDOR and VENDEE the same shall be divided into two (2) equal parts, the VENDOR gets the corner facing J. De Jesus and Malolos Avenue and the VENDEE shall get the portion with fifteen 15 meters frontage facing J. De Jesus Street only. 1 Pursuant to the contract, Donasco paid P2,000.00 to Pingol. The one-half portion, designated as Lot No. 3223-A, was then segregated from the mother lot, and the parties prepared a subdivision plan (Exhibit "C") which was approved by the Land Registration Commission. 2

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Francisco immediately took possession of the subject lot and constructed a house thereon. In January 1970, he started paying the monthly installments but was able to pay only up to 1972. On 13 July 1984, Francisco Donasco died. At the time of his demise, he had paid P8,369.00, plus the P2,000.00 advance payment, leaving a balance of P10,161.00 on the contract price. 3 Lot No. 3223-A remained in the possession of Donasco's heirs. On 19 October 1988, the heirs of Francisco Donasco filed an action for "Specific Performance and Damages, with Prayer for Writ of Preliminary Injunction" against the spouses Vicente and Lourdes Pingol (petitioners herein) before the RTC of Caloocan City. The action was docketed as Civil Case No. 13572 and raffled off to Branch 125 of the said court. In their complaint, 4 the plaintiffs (private respondents herein) averred that after the death of their father, they offered to pay the balance of P10,161.00 plus the stipulated legal rate of interest thereon to Vicente Pingol but the latter rebuffed their offer and has "been demanding for a bigger and unreasonable amount, in complete variance to what is lawfully due and payable." They stated that they had "exerted earnest efforts to forge or reach an amicable and peaceful settlement with the defendants" for the payment of the property in question but to no avail. They further alleged that the defendants were committing "acts of forcible entry and encroachment" upon their land and asked that a writ of preliminary injunction be issued to restrain the defendants from the acts complained of. Plaintiffs then prayed that the defendants be ordered, inter alia: a. . . . to accept the amount of P10,161.00, more or less, plus the stipulated legal rate of interest due thereon, as full and complete payment of the balance for the agreed price/consideration on the one- half (1/2) portion of the parcel of land . . .; [and] b. . . . to execute the final deed of sale on the one-half (1/2) portion of the lot . . . in accordance with the partition reflected in the survey and subdivision plan, . . . . 5 In their answer with counterclaim, 6 defendants admitted the execution of the aforementioned deed of sale, the segregation of the portion sold and the preparation and approval of the subdivision plan, but set up the following special and affirmative defenses: (1) plaintiffs' cause of action had already prescribed; (2) the deed of sale embodied a conditional contract of sale "as the consideration is to be paid on installment basis within a period of six years beginning January, 1970"; (3) the subdivision plan was prepared on the assumption that Francisco Donasco would be able to comply with his obligation; (4) when Francisco died, he had not fully paid the total consideration agreed upon; and (5) considering the breach by Francisco of his contractual obligation way back in 1976, the sale was deemed to have been cancelled and the continuous occupancy of Francisco after 1976 and by his heirs thereafter was by mere tolerance of Vicente Pingol. They then asked that the plaintiffs be ordered to vacate the premises and to pay them attorney's fees and a reasonable compensation for the use of the land. In their Reply and Answer to Counterclaim, 7 the plaintiffs pointed out that there is no provision in the deed of sale for its cancellation in case of default in the payment of the monthly installments and invoked Article 1592 of the New Civil Code. They specifically denied the allegations in the counterclaim. The issues having been joined, the case was then tried on the merits. On 22 January 1990, the trial court rendered a decision 8 dismissing the complaint and ordering the plaintiffs to pay the defendants P350.00 as reasonable monthly rental for the use of the premises from the filing of the complaint, P10,000.00 by way of attorney's fees, and the costs of the suit. It held that: (1) the deed of absolute sale in question, marked and offered in evidence as Exhibit "A," is a contract to sell, not a contract of sale, since Vicente Pingol had no intention to part with the ownership of the loan unless the full amount of the agreed price had been paid; (2) the contract was deemed to have been cancelled from the moment the late father of the plaintiffs defaulted in the payment of the monthly installments; (3) title and ownership over the lot did not pass to Francisco Donasco and his heirs since the contract to sell was never consummated; and (5) assuming, arguendo, that the plaintiffs have a cause of action for specific performance, such action had already prescribed since the complaint was filed only on 19 October 1988 or more than ten years from the time that they could have lawfully demanded performance. 9

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Plaintiffs elevated the case to the Court of Appeals where the appeal was docketed as CA-G.R. CV No. 25967. On 12 November 1991, the said court rendered a decision 10 reversing the appealed decision and decreeing as follows: WHEREFORE, the decision appealed from is hereby REVERSED and SET ASIDE and another one is rendered: (1) Ordering appellee-vendor Vicente Pingol to accept the sum of P10,161.00, plus the legal interest due thereon from the date of institution of this action on October 19, 1988; (2) Upholding the validity of the "DEED OF ABSOLUTE SALE OF ONE- HALF (1/2) (of) AN UNDIVIDED PORTION OF A PARCEL OF LAND" (Exh. A), and by virtue and on the strength of which declaring the "Heirs of the Deceased Francisco N. Domingo" as the owners of the 274.50 sq. m. land, denominated as Lot 3223-A, (LRC) Psd-146255 under the technical description (exh. D) and reflected in the Plan of Subdivision Survey which was approved By Commissioner of Land Registration on August 13, 1971 (exh. C), representing onehalf portion [of] lot 3223, situated at the corner of Malolos Avenue and G. de Jesus St., Bagong Barrio, Caloocan City, and covered by TCT No. 7435 of the Registry of Deeds of Caloocan City (exh. B); and (3) Ordering the defendants-appellees to pay the costs. SO ORDERED. 11 The Court of Appeals ruled that the deed of sale in question reveals the clear intention of Vicente Pingol to part with the ownership of the one-half portion of the land by way of an absolute sale; that the failure to fully pay the agreed price was not a ground for the cancellation of the sale; and that the plaintiffs' action is imprescriptible since it is akin to an action to quiet title to property in one's possession. 12 Dissatisfied with the decision of the Court of Appeals, the defendants, hereinafter referred to as the petitioners, filed this petition for certiorari on 9 January 1992. Plaintiffs, hereinafter referred to as the private respondents, filed their comment thereto on 10 September 1992 to which the petitioners filed a reply 11 November 1992. We gave due course to the petition and required the parties to submit their respective memoranda, 13 which they subsequently complied with. Petitioners contend that the Court of Appeals erred: I. IN HOLDING THAT THE DOCUMENT (EXHIBIT "A") DENOMINATED AS "ABSOLUTE DEED OF SALE OF ONE-HALF () OF AN UNDIVIDED PORTION OF A PARCEL OF LAND" IS AN ABSOLUTE DEED OF SALE SUFFICIENT TO CONFER OWNERSHIP ON THE VENDEE AND HIS SUCCESSORS-IN-INTEREST, DESPITE THE FACT THAT BY ITS TERMS AND CONDITIONS, LIKE THE PRICE BEING PAYABLE ON INSTALLMENTS WITHIN A FIXED PERIOD, THE SAME IS A CONDITIONAL DEED OF SALE. II. IN HOLDING THAT NOTWITHSTANDING THE FACT THAT THE VENDEE FAILED TO COMPLY WITH THE TERMS OF THE CONTRACT (EXHIBIT "A") SPECIFICALLY TO COMPLETE THE PAYMENT OF THE CONSIDERATION ON THE DATE STIPULATED IN THE CONTRACT WHICH WAS SUPPOSED TO BE IN JANUARY 1976, COMPLETE PAYMENT THEREOF CAN STILL BE ENFORCED IN AN ACTION INSTITUTED BY THE HEIRS OF THE VENDEE FILED ON OCTOBER 19, 1988 OR A PERIOD OF MORE THAN TWELVE (12) YEARS FROM THE TIME COMPLETE PAYMENT SHOULD HAVE BEEN MADE; III. IN HOLDING THAT THE PRIVATE RESPONDENTS' ACTION IS ONE WHICH IS AN OFFER TO COMPLETE THE PAYMENT LEFT UNPAID BY PRIVATE RESPONDENTS' FATHER WHICH DOES NOT PRESCRIBE; IV. IN HOLDING THAT PRIVATE RESPONDENTS' CAUSE OF ACTION HAS NOT PRESCRIBE. 14 The decisive issue in this case is whether Exhibit "A" embodies a contract of sale or a contract to sell. The distinction between the two is important for in a contract of sale, the title passes to the vendee upon the delivery of the thing sold, whereas in a contract to sell, by agreement, ownership is reserved in the vendor and is not to pass until the full payment of the price. In a contract of sale, the vendor has lost and cannot recover ownership until and unless the contract is resolved or rescinded, whereas in a contract to sell, title is retained by the vendor until the full payment of LAW ON PROPERTY: QUIETING OF TITLE Page 3

the price, such payment being a positive suspensive condition, failure of which is not a breach but an event that prevented the obligation of the vendor to convey title from becoming effective. 15 A perusal of Exhibit "A" leads to no other conclusion than that it embodies a contract of sale. The plain and clear tenor of the "DEED OF ABSOLUTE SALE OF ONE-HALF (1/2) [OF] AN UNDIVIDED PORTION OF A PARCEL OF LAND" is that "the VENDOR hereby . . . SELL, CONVEY AND CONVEY by way Absolute Sale the one-half (1/2) portion . . . to the VENDEE . . . his heirs, assigns and successors-in-interest." That the vendor, petitioner Vicente Pingol, had that clear intention was further evidenced by his failure to reserve his title thereto until the full payment of the price. In Dignos vs. Court of Appeals, 16 we held that a deed of sale is absolute in nature although denominated as a "Deed of Conditional Sale" where there is no stipulation in the deed that title to the property sold is reserved in the seller until the full payment of the price, nor is there a stipulation giving the vendor the right to unilaterally resolve the contract the moment the buyer fails to pay within a fixed period. Exhibit "A" contains neither stipulation. What is merely stated therein is that "the VENDEE agrees that in case of default in the payment of the installments due the same shall earn a legal rate of interest, and to which the VENDOR likewise agrees." Furthermore, as found by the Court of Appeals, the acts of the parties, contemporaneous and subsequent to the contract, clearly show that an absolute deed of sale was intended, by the parties and not a contract to sell: [P]ursuant to the deed, the vendor delivered actual and constructive possession of the property to the vendee, who occupied and took such possession, constructed a building thereon, had the property surveyed and subdivided and a plan of the property was prepared and submitted to the Land Registration Commission which approved it preparatory to segregating the same and obtaining the corresponding TCT in his name. Since the sale, appellee continuously possessed and occupied the property as owner up to his death on July 13, 1984 and his heirs, after his death, continued the occupancy and possession of the property up to the present. Those contemporaneous and subsequent events are demonstrative acts that the vendor since the sale recognized the vendee as the absolute owner of the property sold. All those attributes of ownership are admitted by defendants in their answer, specifically in paragraphs 7 and 9 of their special and affirmative defenses. 17 The contract here being one of absolute sale, the ownership of the subject lot was transferred to the buyer upon the actual and constructive delivery thereof. The constructive delivery of the subject lot was made upon the execution of the deed of sale 18 while the actual delivery was effected when the private respondents took possession of and constructed a house on Lot No. 3223-A. The delivery of the object of the contract divested the vendor of the ownership over the same and he cannot recover the title unless the contract is resolved or rescinded pursuant to Article 1592 of the New Civil Code which provides that: In the sale of immovable property, even though it may have been stipulated that upon failure to pay the price at the time agreed upon the rescission of the contract shall of right take place, the vendee may pay, even after the expiration of the period, as long as no demand for rescission of the contract has been made upon him either judicially or by a notarial act. After the demand, the court may not grant him a new term. Both the trial court and the Court of Appeals did not find that a notarial or judicial rescission of the contract had been made. Although Vicente Pingol asserts that he had declared to Francisco Donasco that he was cancelling the contract, he did not prove that his demand for rescission was made either judicially or by a notarial act. Petitioners fault the respondent Court for holding that the action of the petitioners is not barred by the statute of limitations. They argue that the private respondents' action, being based upon a written contract, has prescribed since it was brought only in 1988 or more than ten years from the time when the latter could have lawfully demanded performance. 19 We disagree.

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Although the private respondents' complaint before the trial court was denominated as one for specific performance, it is in effect an action to quiet title. In this regard, the following excerpt from Bucton vs. Gabar 20 is apropos: The real and ultimate basis of petitioners' action is their ownership of one- half of the lot coupled with their possession thereof, which entitles them to a conveyance of the property. In Sapto, et al. v. Fabiana [103 Phil. 683, 686-87 (1958)], this Court, speaking thru Mr. Justice J.B.L. Reyes, explained that under the circumstances no enforcement of the contract is needed, since the delivery of possession of the land sold had consummated the sale and transferred title to the purchaser, and that, actually, the action for conveyance is one to quiet title, i.e., to remove the cloud upon the appellee's ownership by the refusal of the appellants to recognize the sale made by their predecessors. That a cloud has been cast on the title of the private respondents is indubitable. Despite the fact that the title had been transferred to them by the execution of the deed of sale and the delivery of the object of the contract, the petitioners adamantly refused to accept the tender of payment by the private respondents and steadfastly insisted that their obligation to transfer title had been rendered ineffective. A vendee in an oral contract to convey land who had made part payment thereof, entered upon the land and had made valuable improvements thereon, is entitled to bring suit to clear his title against the vendor who had refused to transfer the title to him. It is not necessary that the vendee has an absolute title, an equitable title being sufficient to clothe him with personality to bring an action to quiet title. 21 Prescription thus cannot be invoked against the private respondents for it is aphoristic that an action to quiet title to property in one's possession is imprescriptible. 22 The rationale for this rule has been aptly stated thus: The owner of real property who is in possession thereof may wait until his possession is invaded or his title is attacked before taking steps to vindicate his right. A person claiming title to real property, but not in possession thereof, must act affirmatively and within the time provided by the statute. Possession is a continuing right as is the right to defend such possession. So it has been determined that an owner of real property in possession has a continuing right to invoke a court of equity to remove a cloud that is a continuing menace to his title. Such a menace is compared to a continuing nuisance or trespass which is treated as successive nuisances or trespasses, not barred by statute until continued without interruption for a length of time sufficient to affect a change of title as a matter of law. 23 Private respondents shall, however, be liable to pay the legal rate of interest on the unpaid balance of the purchase price from the date default or on 6 January 1976, when the entire balance should have been paid, pursuant to the provision in the deed of sale. WHEREFORE, except as above modified, the Decision appealed from is hereby AFFIRMED. As modified, the interest on the unpaid balance of P10,161.00, at the legal rate, shall be computed from 6 January 1976. Upon the payment by the private respondents to the petitioners of the said amount and the interest thereon, the latter are ordered to deliver Transfer Certificate of Title No. 7435 to the Register of Deeds of Caloocan City who shall cancel the same and issue two new transfer certificates of title in lieu thereof, one of which shall be in the name of the herein private respondents covering Lot No. 3223-A and the other in the name of the petitioners covering the remainder of the lot. SO ORDERED. Cruz, Grio-Aquino, Bellosillo and Quiason, JJ., concur.

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2. G.R. No. 111141

March 6, 1998

MARIO Z. TITONG, petitioner, vs. THE HONORABLE COURT OF APPEALS (4th Division), VICTORICO LAURIO and ANGELES LAURIO, respondents. ROMERO, J.: Like a priceless treasure coveted by many, but capable of ownership by only one, this 20,592 square-meter parcel of land located at Barrio Titong, Masbate, Masbate is claimed by two contestants in this petition for review on certiorari. Unfortunately, legal title over the property can be vested in only one of them. The case originated from an action for quieting of title filed by petitioner Mario Titong. The Regional Trial Court of Masbate, Masbate, Branch 44 1 ruled in of private respondents, Victorico Laurio and Angeles Laurio, adjudging them the true and lawful owners of the disputed land. Affirmed on appeal to the Court, of Appeals, petitioner comes to us for a favorable reversal. Petitioner alleges that he is the owner of an unregistered parcel of land with an area of 3.2800 hectares, more or less, surveyed as Lot No. 3918, and declared for taxation purposes in his name. He claims that on three separate occasions in September 1983, private respondents, with their hired laborers, forcibly entered a portion of the land containing an area of approximately two (2) hectares; and began plowing the same under pretext of ownership. Private respondents denied this allegation, and averred that the disputed property formed part of the 5.5-hectare agricultural land which they had purchased from their predecessor-in-interest, 2 Pablo Espinosa on August 10, 1981. In his testimony, petitioner identified Espinosa as his adjoining owner 3, asserting that no controversy had sprouted between them for twenty years until the latter sold Lot No. 3479 to private respondent Victorico Laurio. 4 This was corroborated by Ignacio Villamor, who had worked on the land even before its sale to Espinosa in 1962. The boundary between the land sold to Espinosa and what of petitioner's property was the old Bugsayon river. When petitioner employed Bienvenido Lerit as his tenant in 1962, he instructed Lerit to change the course of the old river and direct the flow of water to the lowland at the southern of petitioner' s property, thus converting the old river into a riceland. 5 For his part, private respondent anchors his defense on the following facts: He denied petitioner's claim of ownership, recounting that the area and boundaries of the disputed land remained unaltered during the series of conveyances prior to its coming into his hands. According to him, petitioner first declared the land for taxation purposes under Tax Declaration No. 2916, 6 which showed that the land had an area of 5.5 hectares and was bounded on the North by the Bugsayon River; on the East by property under the ownership of Lucio Lerit; on the South by property owner by Potenciano Zaragoza; and on the West by property owned by Agapito de la Cruz. 7 Private Respondent then alleges that, on December 21, 1960, petitioner sold this property to Concepcion Verano vda. de Cabug, after which Tax Declaration No. 5339 8 was issued in her favor. In compliance with their mutual agreement to repurchase the same, petitioner reacquired the property by way of sale 9 on August 24, 1962 and then declared it for taxation purposes in his name under Tax Declaration No. 5720. 10 However, the property remained in petitioner's hands for only four (4) days because, on August 28, 1962, he sold it to Espinosa 11 who then declared it in his name under Tax Declaration No. 12311. 12 Consequently, the property became a part of the estate of Pablo Espinosa's wife, the late Segundina Liao Espinosa. On August 10, 1981, her heirs executed an instrument denominated as "Extrajudicial Settlement of Estate with Simultaneous Sale" whereby the 5.5-hectare property under Tax Declaration No. 12311 was sold to private respondent 13 in consideration of the amount of P5,000.00. Thereafter, Tax Declaration No. 12738 was issued in the name of private respondent. In all these conveyances, the area and boundaries of the property remained exactly the same as those appearing in Tax Declaration No. 2916 under petitioner's name. It was proved at the proceedings in the court a quo that two (2) surveys were made of the disputed property. The first survey 14 was made for petitioner, while the second was the relocation survey ordered by the lower court. As anticipated, certain discrepancies between the two surveys surfaced. Thus, contrary to petitioner's allegation in his complaint that he is the owner of only 3.2800 hectares, he was actually claiming 5.9789 hectares, the total areas of Lot Nos. 3918, 3918-A and 3606. On the other hand, Lot No. 3479 pertaining to Espinosa, was left with only an area of 4.1841 hectares instead of the 5.5 hectares sold by petitioner to him. Apprised of the discrepancy, private respondent LAW ON PROPERTY: QUIETING OF TITLE Page 6

filed a protest 15 before the Bureau of Lands against the first survey, likewise filing a case for alteration of boundaries before the municipal trial court, the proceedings of which, however, were suspended of the instant case. 16 Private respondent testified that petitioner is one of the four heirs of his mother, Leonida Zaragoza. In the Extrajudicial Settlement with Sale of Estate of the deceased Leonida Zaragoza, 17 the heirs adjudicated unto themselves the 3.6hectare property of the deceased. The property involved is described in the instrument as having been declared under Tax Declaration No. 3301 18 and as bounded on the North by Victor Verano, on the East by Benigno Titong, on the South by the Bugsayon River and on the West by Benigno Titong. On September 9, 1969, Tax Declaration No. 8723 was issued to petitioner for his corresponding share in the estate. However, instead of reflecting only .9000 hectare as his rightful share in the extrajudicial settlement 19 petitioner's share was bloated to 2.4 hectares. It therefore appeared to private respondent that petitioner encroached upon his (Laurio's) property and declared it a part of his inheritance. 20 The boundaries were likewise altered so that it was bounded on the North by Victor Verano, on the East by Benigno Titong, on the South by property owner Espinosa, and on the West by property owner Adolfo Titong. 21 Private respondent accordingly denied that petitioner had diverted the course of the Bugsayon River after he had repurchased the land from Concepcion Verano vda. de Cabug 22 because the land was immediately sold to Espinosa shortly thereafter. 23 The lower court rendered a decision in favor of private respondents, declaring him as the true and absolute owner of the litigated property and ordering petitioner to respect private respondents' title and ownership over the property and to pay attorney's fees, litigation expenses, costs and moral damages. Petitioner appealed to the Court of Appeals, which affirmed the decision. On motion for reconsideration, the same was denied for lack of merit. Hence, this petition for review on certiorari. At the outset, we hold that the instant petition must be denied for the reason that the lower court should have outrightly dismissed the complaint for quieting of title. The remedy of quieting of title may be availed of under the circumstances enumerated in the Civil Code: Art. 476. Whenever there is a cloud on title to real property or any interest therein, by reason of any instrument, record, claim, encumbrance or proceeding which is apparently valid or effective but is in truth and in fact invalid, ineffective, voidable, or unenforceable, and may be prejudicial to said title, an action may be brought to remove such cloud or to quiet the title. An action may also be brought to prevent a cloud from being cast upon title to real property or any interest therein. Under this provision, a claimant must show that there is an instrument, record, claim, encumbrance or proceeding which constitutes or casts a cloud, doubt, question or shadow upon the owner's title to or interest in real property. 24 The ground or reason for filing a complaint for quieting of title must therefore be "an instrument, record, claim, encumbrance or proceeding." Under the maxim expresio mius est exclusio alterius, these grounds are exclusive so that other reasons outside of the purview of these reasons may not be considered valid for the same action. 25 Had the lower court thoroughly considered the complaint filed, it would have had no other course of action under the law but to dismiss it. The complaint failed to allege that an "instrument, record, claim, encumbrance or proceeding" beclouded the plaintiff's title over the property involved. Petitioner merely alleged that the defendants (respondents herein), together with their hired laborers and without legal justification, forcibly entered the southern portion of the land of the plaintiff and plowed the same. He then proceeded to claim damages and attorney's fees. He prayed that, aside from issuing a writ or preliminary injunction enjoining private respondents and their hired laborers from intruding into the land, the court should declare him "the true and absolute owner" thereof. Hence, through his allegations, what petitioner imagined as clouds cast on his title to the property were private respondents' alleged acts of physical intrusion into his purported property. Clearly, the acts alleged may be considered grounds for an action for forcible entry but definitely not one for quieting of title. When the issues were joined by the filing of the answer to the complaint, it would have become apparent to the court that the case was a boundary dispute. The answer alleged, among other matters, that petitioner, "in bad faith, surreptitiously, maliciously and fraudulently had the land in question included in the survey of his land which extends to LAW ON PROPERTY: QUIETING OF TITLE Page 7

the south only as far as the Bugsayon River which is the visible and natural and common boundary between the properties." 26 Moreover, during the hearing of the case, petitioner proved that it was actually a boundary dispute by evidence showing what he considered as the boundary of his property which private respondents perceived as actually encroaching on their property. In this regard, the following pronouncements of the Court are apropos: . . . (T)he trial court (and likewise the respondent Court) cannot, in an action for quieting of title, order the determination of the boundaries of the claimed property, as that would be tantamount to awarding to one or some of the parties the disputed property in an action where the sole issue is limited to whether the instrument, record, claim, encumbrance or proceeding involved constitutes a cloud upon the petitioners' interest or title in and to said property. Such determination of boundaries is appropriate in adversarial proceedings where possession or ownership may properly be considered and where evidence aliunde, other than the "instrument, record, claim, encumbrance or proceeding" itself, may be introduced. An action for forcible entry, whenever warranted by the period prescribed in Rule 70, or for recovery of possession de facto, also within the prescribed period, may be availed of by the petitioners, in which proceeding the boundary dispute may be fully threshed out. 27 Nonetheless, even if the complaint below were to be considered as a valid one for quieting of title, still, the instant petition for review on certiorari must fail. As a general rule, findings of fact of the Court of Appeals are binding and conclusive upon this Court. Such factual findings shall not be disturbed normally unless the same are palpably unsupported by the evidence on record or the judgment itself is based on a misapprehension of facts. 28 Upon an examination of the records, the Court finds no evident reason to depart from the general rule. The courts below correctly held that when petitioner "sold, ceded, transferred and conveyed" the 5.5-hectare land in favor of Pablo Espinosa, his rights of ownership and possession pertaining thereto ceased and these were transferred to the latter. In the same manner, Espinosa's rights of ownership over the land ceased and were transferred to private respondent upon its sale to the latter. This finds justification in the Civil Code, as follows: Art. 1458. By the contract of sale one of the contracting parties obligates himself to transfer the ownership of and to deliver a determinate thing, and the other to pay therefor a price certain in money or its equivalent. A contract of sale may be absolute or conditional. In other words, a sale is a contract transferring dominion and other real rights in the thing sold. 29 In the case at bar, petitioner's claim of ownership must of necessary fail because he has long abdicated his rights over the land when he sold it to private respondent's predecessor-in-interest. Petitioner's claim that he acquired ownership over the disputed land through possession for more than twenty (20) years is likewise unmeritorious. While Art. 1134 of the Civil Code provides that "(o)wnership and other real rights over immovable property are acquired by ordinary prescription through possession of ten years," this provision of law must be read in conjunction with Art. 1117 of the same Code. This article states that ". . . (o)rdinary acquisitive prescription of things requires possession in good faith and with just title for the time fixed by law." Hence, a prescriptive title to real estate is not acquired by mere possession thereof under claim of ownership for a period of tea years unless such possession was acquired con justo tilulo y buena fe (with color of title and good faith). 30 The good faith of the possessor consists in the reasonable belief that the person from whom he received the thing was the owner thereof, and could transmit his ownership. 31 For purposes of prescription, there is just title when the adverse claimant came into possession of the property through one of the modes recognized by law for the acquisition of ownership or other real rights but the grantor was not the owner or could not transmit any right. 32 Petitioners have not satisfactorily met the requirements of good faith and just title. As aptly observed by the trial court, the plaintiff's admitted acts of converting boundary line (Bugsayon River) into a ricefield and thereafter claiming ownership thereof were acts constituting deprivation of the rights of others and therefore "tantamount to bad faith." 33 To allow petitioner to benefit from his own wrong would run counter to the maxim ex dolo malo non oritur actio (no man can allowed to found a claim upon his own wrongdoing). Extraordinary acquisitive prescription cannot similarly vest ownership over the property upon petitioner. Art. 1137 of the Civil Code states that "(o)wnership and other real rights over immovables prescribe through uninterrupted adverse possession thereof for thirty years, without need of title or of good faith." Petitioner's alleged possession in 1962 up to September 1983 when private respondents entered the LAW ON PROPERTY: QUIETING OF TITLE Page 8

property in question spanned twenty-one (21) years. This period of time is short of the thirty-year requirement mandated by Art. 1137. Petitioner basically anchors his claim over the property on the survey plan prepared upon his request, 34 the tax declaration in his name, 35 the commissioner's report on the relocation survey, 36 and the survey plan. 37 Respondent court correctly held that these documents do not conclusively demonstrate petitioner's title over Lot Nos. 3918-A and 3606. A survey is the act by which the quantity of a parcel of land is ascertained and so a paper containing a statement of courses, distances, and quantity of land. 38 A survey under a proprietary title is not a conveyance. It is an instrument sui generis in the nature of a partition; a customary mode in which a proprietor has set off to himself in severalty a part of the common estate. 39 Therefore, a survey, not being a conveyance, is not a mode of acquiring ownership. A fortiori, petitioner cannot found his claim on the survey plan reflecting a subdivision of land because it is not conclusive as to ownership as it may refer only to a delineation of possession. 40 Furthermore, the plan was not verified and approved by the Bureau of Lands in accordance with Sec. 28, paragraph 5 of Act No. 2259, the Cadastral Act, as amended by Sec. 1862 of Act No. 2711. Said law ordains that private surveyors send their original field notes, computations, reports, surveys, maps and plots regarding a piece of property to the Bureau of Lands for verification and approval. 41 A survey plan not verified and approved by said Bureau is nothing more than a private writing, the due execution and authenticity of which must be proven in accordance with Sec. 20 of Rule 132 of the Rules of Court. The circumstance that the plan was admitted in evidence without any objection as to its due execution and authenticity does not signify that the courts shall give probative value therefor. To admit evidence and not to believe it subsequently are not contradictory to each other. This Court cannot alter the conclusions of the Court of Appeals on the credibility accorded to evidence presented by the parties. 42 Similarly, petitioner's tax declaration issued under his name is not even persuasive evidence of his claimed ownership over the land in dispute. A tax declaration, by itself, is not considered conclusive evidence of ownership. 43 It is merely an indicium of a claim of ownership. 44 Because it does not by itself give title, it is of little value in proving one's ownership. 45 Moreover, the incompatibility in petitioner's tax declaration and the commissioner's report as regards the area of his claimed property is much too glaring to be ignored. Tax Declaration No. 8717 states that petitioner's property has an area of 3.2800 hectares while the totality of his claim according to the commissioned geodetic engineer's survey amounts to 4.1385 hectares. There is therefore a notable discrepancy of 8,585 square meters. On the other hand, private respondent's claimed property, as borne out by Tax Declaration No. 12738, totals 5.5 hectares, a more proximate equivalent of the 5.2433-hectare property as shown by the commissioner's report. There is also nothing in the commissioner's report that substantiates petitioner's claim that the disputed land was inside his property. Petitioner capitalizes on the lower court's statement in its decision 46 that "as reflected in the commissioner's report dated May 23, 1984 (Exhibit 3-3-A), the area claimed is inside lot 3918 of the defendants (Exhibit 2)" 47 or the private respondents. A careful reading of the decision would show that this statement is found in the summary of defendants' (herein private respondents) evidence. Reference to Lot No. 3918 may, therefore, be attributed to mere oversight as the lower court even continues to state the defendants' assertion that the 2-hectare land is part of their 5.5-hectare property. Hence, it is not amiss to conclude that either petitioner misapprehended the lower court's decision or he is trying to contumaciously mislead or worse, deceive this Court. With respect to the awards of moral damages of P10,000.00 and attorney's fees of P2,000.00, the Court finds no cogent reason to delete the same. Jurisprudence is replete with rulings to the effect that where fraud and bad faith have been established, the award of moral damages is in order. 48 This pronouncement finds support in Art. 2219 (10) of the Civil Code allowing the recovery of moral damages for acts enumerated in Art. 21 of the same Code. This article states that "(a)ny person who wilfully causes loss or injury to another in a manner that is contrary to morals, good customs or public policy shall compensate the latter for the damage." The moral damages are hereby increased to P30,000.00. We agree with the respondent court in holding that the award of attorney's fees is justified because petitioner filed a clearly unfounded civil action. 49 WHEREFORE, the instant petition for review on certiorari is hereby DENIED and the questioned Decision of the Court of Appeals AFFIRMED. This Decision is immediately executory. Costs against petitioner. SO ORDERED. LAW ON PROPERTY: QUIETING OF TITLE Page 9

Narvasa, C.J., Kapunan and Purisima, JJ., concur.

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3. G.R. No. 156171

April 22, 2005

Spouses RICARDO and FERMA PORTIC, Petitioners, vs. ANASTACIA CRISTOBAL, Respondent, PANGANIBAN, J.: An agreement in which ownership is reserved in the vendor and is not to pass to the vendee until full payment of the purchase price is known as a contract to sell. The absence of full payment suspends the vendors obligation to convey title. This principle holds true between the parties, even if the sale has already been registered. Registration does not vest, but merely serves as evidence of, title to a particular property. Our land registration laws do not give title holders any better ownership than what they actually had prior to registration. The Case Before us is a Petition for Review1 under Rule 45 of the Rules of Court, challenging the January 29, 2002 Decision 2 and the November 18, 2002 Resolution3 of the Court of Appeals (CA) in CA-GR CV No. 66393. The assailed Decision disposed as follows: "WHEREFORE, foregoing considered, the appealed decision is hereby REVERSED and SET ASIDE. A new one is hereby entered ORDERING defendant-appellant to pay the unpaid balance of P55,000.00 plus legal interest of 6% per annum counted from the filing of this case. The ownership of defendant-appellant over the subject property is hereby confirmed. "No pronouncement as to costs."4 In the challenged Resolution,5 the CA denied petitioners Motion for Partial Reconsideration. The Facts The facts were summarized by the appellate court as follows: "Spouses Clodualdo Alcantara and Candelaria Edrosalam were the original registered owners of a parcel of land with three-door apartment, located at No. 9, 1st Street BBB, Marulas, Valenzuela City. Transfer Certificate of Title No. T71316 was issued in the names of spouses Clodualdo Alcantara and Candelaria Edrosalam. "On October 2, 1968, spouses Clodualdo Alcantara and Candelaria Edrosalam sold the subject property in favor of [petitioners] with the condition that the latter shall assume the mortgage executed over the subject property by spouses Clodualdo Alcantara and Candelaria Edrosalam in favor of the Social Security System. "[Petitioners] defaulted in the payment of the monthly amortizations due on the mortgage. The Social Security System foreclosed the mortgage and sold the subject property at public auction with the Social Security System as the highest bidder. "On May 22, 1984, before the expiration of the redemption period, [petitioners] sold the subject property in favor of [respondent] in consideration of P200,025.89. Among others, the parties agreed that [respondent] shall pay the sum of P45,025.89 as down payment and the balance of P155,000.00 shall be paid on or before May 22, 1985. The parties further agreed that in case [respondent] should fail to comply with the conditions, the sale shall be considered void and [petitioners] shall reimburse [respondent] of whatever amount already paid. "On the same date, [petitioners] and [respondent] executed a Deed of Sale with Assumption of Mortgage whereby [petitioners] sold the subject property in favor of [respondent] in consideration of P80,000.00, P45,000.00 thereof shall be paid to the Social Security System. LAW ON PROPERTY: QUIETING OF TITLE Page 11

"On July 30, 1984, spouses Clodualdo Alcantara and Candelaria Edrosalam, the original owners of the subject property, sold the subject property in favor of [respondent] for P50,000.00. "On the same date, [respondent] executed a Deed of Mortgage whereby [respondent] constituted a mortgage over the subject property to secure a P150,000.00 indebtedness in favor of [petitioners]. "[Respondent] paid the indebtedness due over the subject property to the Social Security System. "On August 6, 1984, Transfer Certificate of Title No. T-71316 in the names of spouses Clodualdo Alcantara and Candelaria Edrosalam was cancelled and in lieu thereof Transfer Certificate of Title No. T-113299 was issued in the name of [respondent]. "On May 20, 1996, [petitioners] demanded from [respondent] the alleged unpaid balance of P55,000.00. [Respondent] refused to pay. "On June 6, 1996, [petitioners] filed this instant civil case against [respondent] to remove the cloud created by the issuance of TCT No. T-113299 in favor of [respondent]. [Petitioners] claimed that they sold the subject property to [respondent] on the condition that [respondent] shall pay the balance on or before May 22, 1985; that in case of failure to pay, the sale shall be considered void and [petitioners] shall reimburse [respondent] of the amounts already paid; that [respondent] failed to fully pay the purchase price within the period; that on account of this failure, the sale of the subject property by [petitioners] to [respondent] is void; that in spite of this failure, [respondent] required [petitioners] to sign a lease contract over the apartment which [petitioners] occupy; that [respondent] should be required to reconvey back the title to the subject property to [petitioners]. "[Respondent] on her part claimed that her title over the subject property is already indefeasible; that the true agreement of the parties is that embodied in the Deed of Absolute Sale with Assumption of Mortgage; that [respondent] had fully paid the purchase price; that [respondent] is the true owner of the subject property; that [petitioners] claim is already barred by laches."6 After trial, the Regional Trial Court (RTC) of Valenzuela City rendered this judgment in favor of petitioners: "WHEREFORE, premises considered, this Court hereby adjudicates on this case as follows: 1.) The Court hereby orders the quieting of title or removal of cloud over the [petitioners] parcel of land and three (3) door apartment now covered by Transfer Certificate of Title No. T-113299 of the Registry of Deeds for Caloocan City and Tax Declaration Nos. C-018-00235 & C-031-012077 respectively, of Valenzuela City; 2.) The Court hereby orders the [respondent] to reconvey in favor of the [petitioners] the parcel of land and three (3) door apartment now covered by Transfer Certificate of Title No. T-113299 of the Registry of Deeds of Caloocan City after reimbursement by the [petitioners] of the amount actually paid by the [respondent] in the total amount of P145,025.89; 3.) The Court hereby DENIES damages as claimed by both parties." 7 Ruling of the Court of Appeals The Court of Appeals opined that the first Memorandum of Agreement (MOA) embodied the real agreement between the parties, and that the subsequent Deeds were executed merely to secure their respective rights over the property. 8 The MOA stated that Cristobal had not fully paid the purchase price. Although this statement might have given rise to a cause of action to annul the Deed of Sale, prescription already set in because the case had been filed beyond the ten-year reglementary period, 9 as observed by the CA. Nonetheless, in conformity with the principle of unjust enrichment, the appellate court ordered respondent to pay petitioners the remaining balance of the purchase price. 10 In their Motion for Partial Reconsideration, petitioners contended that their action was not one for the enforcement of a written contract, but one for the quieting of title -- an action that was imprescriptible as long as they remained in possession of the premises.11 The CA held, however, that the agreement between the parties was valid, and that LAW ON PROPERTY: QUIETING OF TITLE Page 12

respondents title to the property was amply supported by the evidence. 12 Therefore, their action for the quieting of title would not prosper, because they failed to show the invalidity of the cloud on their title. Hence, this Petition.13 The Issue In its Memorandum, petitioners raise the following issues for our consideration: "(1) Whether or not the [petitioners] cause of action is for quieting of title. "(2) Whether or not the [petitioners] cause of action has prescribed." 14 The main issue revolves around the characterization of the parties agreement and the viability of petitioners cause of action. This Courts Ruling The Petition has merit. Main Issue: Nature of the Action: Quieting of Title or Enforcement of a Written Contract Petitioners argue that the action they filed in the RTC was for the quieting of title. Respondents demand that they desist from entering into new lease agreements with the tenants of the property allegedly attests to the fact of their possession of the subject premises.15 Further, they point to the existence of Civil Case No. 7446, an action for unlawful detainer that respondent filed against them,16 as further proof of that fact. Being in continuous possession of the property, they argue that their action for the quieting of title has not prescribed. 17 On the other hand, respondent joins the appellate court in characterizing the action petitioners filed in the RTC as one for the enforcement of the MOA. Being based on a written instrument, such action has already prescribed, respondent claims.18 She adds that petitioners could not have been in continuous possession of the subject property because, under a duly notarized lease agreement, they have been paying her a monthly rental fee of P500, which was later increased to P800. Two questions need to be answered to resolve the present case; namely, (1) whether Cristobals title to the property is valid; and (2) whether the Portics are in possession of the premises, a fact that would render the action for quieting of title imprescriptible. Validity of Title The CA held that the action for the quieting of title could not prosper, because Cristobals title to the property was amply supported by evidence. Article 476 of the Civil Code provides as follows: "Whenever there is a cloud on title to real property or any interest therein, by reason of any instrument, record, claim, encumbrance or proceeding which is apparently valid or effective but is in truth and in fact invalid, ineffective, voidable, or unenforceable, and may be prejudicial to said title, an action may be brought to remove such cloud or to quiet the title. "An action may also be brought to prevent a cloud from being cast upon title to real property or any interest therein."

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Suits to quiet title are characterized as proceedings quasi in rem.19 Technically, they are neither in rem nor in personam. In an action quasi in rem, an individual is named as defendant.20 However, unlike suits in rem, a quasi in rem judgment is conclusive only between the parties.21 Generally, the registered owner of a property is the proper party to bring an action to quiet title. However, it has been held that this remedy may also be availed of by a person other than the registered owner because, in the Article reproduced above, "title" does not necessarily refer to the original or transfer certificate of title. 22 Thus, lack of an actual certificate of title to a property does not necessarily bar an action to quiet title. As will be shown later, petitioners have not turned over and have thus retained their title to the property. On the other hand, the claim of respondent cannot be sustained. The transfer of ownership of the premises in her favor was subject to the suspensive condition stipulated by the parties in paragraph 3 of the MOA, which states as follows: "3. That while the balance of P155,000.00 has not yet been fully paid the FIRST PARTY OWNERS shall retain the ownership of the above described parcel of land together with its improvements but the SECOND PARTY BUYER shall have the right to collect the monthly rentals due on the first door (13-A) of the said apartment;" 23 The above-cited provision characterizes the agreement between the parties as a contract to sell, not a contract of sale. Ownership is retained by the vendors, the Portics; it will not be passed to the vendee, the Cristobals, until the full payment of the purchase price. Such payment is a positive suspensive condition, and failure to comply with it is not a breach of obligation; it is merely an event that prevents the effectivity of the obligation of the vendor to convey the title.24 In short, until the full price is paid, the vendor retains ownership. The mere issuance of the Certificate of Title in favor of Cristobal did not vest ownership in her. Neither did it validate the alleged absolute purchase of the lot. Time and time again, this Court has stressed that registration does not vest, but merely serves as evidence of, title. Our land registration laws do not give the holders any better title than that which they actually have prior to registration. 25 Under Article 1544 of the Civil Code, mere registration is not enough to acquire a new title. Good faith must concur. 26 Clearly, respondent has not yet fully paid the purchase price. Hence, as long as it remains unpaid, she cannot feign good faith. She is also precluded from asserting ownership against petitioners. The appellate courts finding that she had a valid title to the property must, therefore, be set aside. Continuous Possession The issue of whether the Portics have been in actual, continuous possession of the premises is necessarily a question of fact. Well-entrenched is the rule that findings of fact of the Court of Appeals, when supported by substantial evidence, are final and conclusive and may not be reviewed on appeal. 27 This Court finds no cogent reason to disturb the CAs findings sustaining those of the trial court, which held that petitioners had been in continuous possession of the premises. For this reason, the action to quiet title has not prescribed. WHEREFORE, the Petition is GRANTED. The challenged Decision and Resolution of the Court of Appeals are REVERSED and SET ASIDE. The Decision of the RTC of Valenzuela City in Civil Case No. 4935-V-96, dated September 23, 1999, is hereby REINSTATED. No pronouncement as to costs. SO ORDERED.

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4. G.R. Nos. 99338-40

February 1, 1993

HEIRS OF NICOLAS Y. OROSA, (Represented herein by their Attorney-in-Fact, RICARDO Q. OROSA), petitioners, vs. THE HON. EUTROPIO MIGRINO, Presiding Judge, Regional Trial Court of Pasig, M.M. Branch 151 and GOLDENROD, INC., respondents. FELICIANO, J.: In Maria Mayug Vda. de Cailles v. Dominador Mayuga, et. al., 1 the Court affirmed the decision of the Court of Appeals in C.A.-G.R. No. 31887-R, confirming ownership over a fifty-three (53) hectare parcel of land located in Las Pias, Rizal, more particularly referred to as Lot 9 Psu-11411 Amd-2, in favor of one Dominador Mayuga. The Court also extended the benefit of such confirmation to the latter's successor-in-interest, the late Nicolas Orosa. After the case was remanded to Branch 151 of theRegional Trial Court, Pasig, where it was originally docketed in 1958 as Land Registration Case ("LRC") No. 2839, the heirs of Nicolas Orosa (petitioners herein) moved for execution of judgment. This motion was granted by the lower court in its Order dated 25 October 1989, directing the Land Registration Authority ("LRA") to submit the property's amended technical description for approval. 2 However, the LRA did not comply with said order because, among others, its records indicated that the property had previously been decreed in favor of one Jose T. Velasquez, to whom was issued Original Certificate of Title No. 6122. 3 On 10 September 1990, Goldenrod, Inc. ("Goldenrod") filed a motion for leave to intervene in the execution proceeding, alleging an interest in the property which is the subject matter of LRC No. 2839. 4 Petitioners opposed Goldenrod's motion, without success. The lower court permitted Goldenrod to file its pleading in intervention through its Order dated 7 December 1990. Petitioners' motion for reconsideration therefrom was likewise denied in an Order dated 11 April 1991. 5 Hence this Petition for Certiorari and Prohibition. After reviewing the comment required of private respondent Goldenrod, the Court resolved to give due course to the petition and to issue a temporary restraining order to enjoin the public respondent lower court from taking further action in LRC No. 2839. Upon filing of petitioner's reply to said comment, the case was submitted for decision. Two (2) ultimate issues are posed for the Court's consideration in this case: 1) whether Goldenrod has shown in its pleadings in intervention a sufficient legal interest in the land which is the subject matter of LRC No. 2839; and 2) whether the legal interest actually shown by Goldenrod over the land can be protected in a Proceeding separate from LRC No. 2839. In respect of the first issue, the Court must observe that the lower court had evaded resolving this matter before permitting Goldenrod's intervention: The Orosa heirs also contend that the purported intervenor failed to establish its alleged legal interest in these proceedings to the subject parcel of land. Precisely, this case has to be set for hearing to enable Goldenrod to prove its claim to the land in question. 6 (Emphasis supplied). As the Court understands it, Goldenrod attempts to augment the ruling of the lower court by showing in its pleadings in intervention, as well as in its comment before the Court, the existence of a legal interest in the land sufficient to justify its intervention. Goldenrod claims that in 1977, during the pendency of this case before the Court in G.R. No. L-30859, Delta Motors Corporation (Delta) acquired for value the contingent rights of Nicolas Orosa over the property, as well as the conflicting claims thereto of one Jose Velasquez. 7 In 1980, the land registration court trying Jose Velasquez' claims in LRC No. N-5416 excluded therefrom the land referred to as Lot 9 Psu-11411 Amd-2 in G.R. No. L-30859. 8 Meanwhile, Delta somehow managed to obtain transfer certificates of titles over the land and sold this acquisition to Goldenrod in LAW ON PROPERTY: QUIETING OF TITLE Page 15

1987. 9 The latter then succeeded in obtaining issuance in its favor of Transfer Certificates of Title Nos. 4893 and 4901, whose technical descriptions overlapped "big portions" of the land referred to as Lot 9 Psu-11411 Amd-2 in G.R. No. L30859. 10 In February 1989, Goldenrod sold the land covered by said transfer certificates of title to a consortium composed of Fil Estate Management Inc., Arturo Y. Dy, Megatop Realty Development Inc., Peaksun Enterprises and Export Corporation, and Elena D. Jao ("Consortium"). 11 The contract of sale contained an undertaking on Goldenrod's part to "defend the title of the VENDEES to the property against claims of any third person whatsoever." 12 It is on the basis of this stipulation that Goldenrod seeks to intervene in the execution Proceedings of LRC No. 2839. Taking Goldenrod's own admissions at their face value, it is quite apparent that whatever direct and actual legal interest it may have had over the land had been disposed of by it for value in favor of the consortium in 1989 and that whatever residual legal interest in the property can be premised on Goldenrod's contractual undertaking, actually an express warranty against eviction, is expectant or contingent in nature. Presently, Goldenrod has no legal interest in the property and its warranty can only be enforced by the consortium if the latter is dispossessed of the land by virtue of a proper action instituted by the Orosa heirs as registered owners thereof. 13 But, the legal interest which entitles a person to intervene in a suit must be actual and material, direct and immediate. A party seeking to intervene in a pending case must show that he will either gain or lose by the direct legal operation and effect of a judgment. 14 In the present case, Goldenrod has failed to meet this criteria and the lower court gravely abused its discretion in permitting intervention after having overlooked this matter. One of the other reasons invoked by the public respondent in permitting intervention at the execution stage of LRC No. 2839 follows: The Orosa heirs contend that intervention can not be allowed at this stage of the proceedings in this case. They forget that in a land registration case even when the decree has been issued, the case can be re-opened within (1) year from issuance of said decree to enable any prejudiced party to present evidence in support of his claim. 15 It appears that the lower court cited Section 32 of P.D. 1529. 16 permitting the reopening of a decree of registration within one year after its entry, if the same was procured through actual fraud and a person is thereby deprived of any interest over the affected land. The difficulty with this view is that, as earlier noted, Goldenrod had not shown any actual interest in the land of which it could have been deprived, on the basis of an actual or extrinsic fraud perpetrated by petitioners in the course of procuring their decree of confirmation. Goldenrod had merely alleged, rather ambiguously, a cause of action against petitioners in that they "suddenly breached and disregarded the 1977 Agreement" (the sale between Nicolas Orosa and Delta). 17 Even the public respondent made no finding that Goldenrod was the apparent victim of an actual fraud. Hence its invocation of the remedy provided in Section 32 of P.D. 1529 was bereft of basis. The action of the lower court in permitting Goldenrod's intervention at this late stage of the proceedings in LRC No. 2839 is also flawed by another, more serious defect. It must be remembered that upon entry of the Court's judgment in G.R. No. L-30859, the confirmation of a registerable title, and the consequent adjudication of ownership over Lot 9 Psu-11411 Amd-2, in favor of petitioners' predecessors-in-interest became a final and settled matter. 18 Such entry of judgment operated, ipso facto to divest the lower court of its general jurisdiction to act in LRC No. 2839, save for the limited matter of supervising the process of executing the Court's decision. The public respondent simply cannot, as it appears to be trying to do in this case, interpret or reverse the implication of this Court's ruling that petitioners are entitled to a Torrens title over Lot 9 Psu-11411 Amd-2, just because Goldenrod seeks to recall execution by making a supervening allegation that petitioners are no longer the owners thereof. 19 Goldenrod attempted to broaden the jurisdiction of the lower court, so as to enable the latter to take cognizance of its motion for intervention, by invoking the Court's ruling in Suson v. Court of Appeals: 20 It cannot be overlooked that the hearing before the respondent court on the motion for demolition (emphasis supplied by the Court) was in connection with the implementation or execution of a final judgment in Civil Case LAW ON PROPERTY: QUIETING OF TITLE Page 16

No. R-14351. Petitioner was precisely given an opportunity to intervene in order to guide the court in disposing of private respondent's motion for demolition in the light of petitioner's claim that his house was erected on the disputed lot (emphasis supplied by the Court), and yet, he was not an original party to the action. Petitioner was thus given a chance to raise and prove his claim of ownership over a part of the lot in question (emphasis supplied by the Court), but he ignored such opportunity. He cannot now complain that he was denied due process. "A case in which an execution has been issued is regarded as still pending so that all proceedings on the execution are proceedings in the suit. There is no question that the court which rendered the judgment has a general supervisory control over its process of execution, and this power carries with it the right to determine every question of fact and law which may be involved in the execution ." (Emphasis supplied by Goldenrod). But it is evident that Goldenrod's reliance upon the Suson case is misplaced because the intervenor therein had a direct and actual legal interest in the property sought to be recovered by the prevailing party at execution. Consequently, the executing court thereat had to accord the intervenor a full hearing on whatever claim he might seek to make, disregarding the rules of procedure limiting intervention to the period before or during a trial of a case, 21 in the interest of observing due process as an aspect of substantial justice. Here, these considerations do not obtain and the lower court, in permitting intervention, caused needless complication, expense and delay in the execution proceedings of LRC No-2839, to the prejudice of petitioners' right to a speedy disposition thereof. Turning to the second issue posed in this case, given the remote and contingent nature of Goldenrod's legal interest over the real property which is the subject matter of LRC No. 2839, the Court believes that Goldenrod can and should protect such interest in a separate proceeding. The public respondent invoked the following to support its view that the execution stage of the land registration proceeding was the proper venue within which Goldenrod can protect its interest in the property. 22 Movants also contend that the granting of leave to intervene will unduly delay the disposition of this case. The adjudication of Goldenrod, Inc.'s interest in the subject parcel of land in the instant case would be for the benefit not only of Goldenrod, Inc. itself, (but) also of the Orosa heirs, because thereafter there will be no cloud in the title of the party to whom the ownership of said parcel of land may be adjudicated . Finally, the movants contend that the intervenor's interest can be protected in a separate proceedings ( sic). The Court doubts if this is true. In any event, as above adverted to, everybody will be benefited by this Court adjudicating in this case the claim of the intervenor . (Emphasis supplied). It would appear that the public respondent premised its ruling solely on the belief that a cloud had descended on the title over the real property which is the subject matter of LRC No. 2839 and that this cloud had to be removed. This justification does not persuade. Under Article 447 of the Civil Code, 23 the plaintiff in an action for quieting of title must at least have equitable title to or an interest in the real property which is the subject matter of the action. Evidence of Goldenrod's capacity on this point is inexistent because Goldenrod is not asserting a claim to the property. 24 On the contrary, it had admitted having alienated its interest in the land referred to as Lot 9 Psu-11411 Amd-2 to the consortium. Thus, Goldenrod is not an interested party capable of instituting an action to quiet title, either by intervening in LRC No. 2839 or by instituting a separate action. The right to commence such a separate action pertains to its Vendee, if the latter wishes to defend the validity of its 1987 purchase from Golderrod and to hold the Vendor Goldenrod liable on its warranty of title. WHEREFORE. the Petition for Certiorari and Prohibition is hereby GRANTED. The Orders of the public respondent dated 7 December 1990 and 11 April 1991, being issued with grave abuse of discretion amounting to excess of jurisdiction, are hereby ANNULLED and SET ASIDE. The public respondent's Order dated 25 October 1989 is hereby REINSTATED and the Temporary Restraining Order issued by the Court in this case is correspondingly LIFTED. In view of the long pendency of LRC No. 2839, the public respondent is hereby enjoined to terminate the proceeding as soon as possible by completing the execution of the Court's Decision in G.R. No. L-30859 with all deliberate speed. This Decision is immediately executory. No costs. SO ORDERED. LAW ON PROPERTY: QUIETING OF TITLE Page 17

5. G.R. No. 168222

April 18, 2006

SPS. TEODULO RUMARATE, (deceased) and ROSITA RUMARATE; deceased TEODULO RUMARATE is represented herein by his Heirs/Substitutes, namely, ANASTACIA RUMARATE, CELSO RUMARATE, MARINA RUMARATE, ROMEO RUMARATE, GUILLERMO RUMARATE, FIDEL RUMARATE, MERLINDA RUMARATE, MARISSA RUMARATE, CLEMENCIA RUMARATE, SANCHO RUMARATE and NENITA RUMARATE, Petitioners, vs. HILARIO HERNANDEZ, JOAQUIN HERNANDEZ, SALVADOR HERNANDEZ, BENJAMIN HERNANDEZ, LEONORA HERNANDEZ-LAZA, VICTORIA HERNANDEZ-MERCURIO, RODRIGOHERNANDEZ, BERNARDO HERNANDEZ, LOURDES HERNANDEZ-CABIDA, MARIO SALVATIERRA, ADELAIDA FONTILA-CIPRIANO, and THE REGISTER OF DEEDS OF QUEZON PROVINCE, Respondents. YNARES-SANTIAGO, J.: Assailed in this petition for review is the May 26, 2005 Decision 1 of the Court of Appeals in CA-G.R. CV No. 57053, which reversed and set aside the March 31, 1997 Decision 2 of the Regional Trial Court of Calauag, Quezon, Branch 63, in Civil Case No. C-964, declaring petitioners as owners of Lot No. 379 with an area of 187,765 square meters and located in Barrio Catimo,3 Municipality of Guinayangan, Province of Quezon. The facts show that on September 1, 1992, petitioner spouses Teodulo Rumarate (Teodulo) and Rosita Rumarate filed an action for reconveyance of real property and/or quieting of title with damages against respondent heirs of the late spouses Cipriano Hernandez and Julia Zoleta.4 Teodulo averred that Lot No. 379 was previously possessed and cultivated by his godfather, Santiago Guerrero (Santiago), a bachelor, who used to live with the Rumarate family in San Pablo City. Between 1923 and 1924, Santiago and the Rumarate family transferred residence to avail of the land distribution in Catimo, Guinayangan, Quezon. From 1925 to 1928, Santiago occupied Lot No. 379 cultivating five hectares thereof. Before moving to Kagakag, Lopez, Quezon in 1929, Santiago orally bequeathed his rights over Lot No. 379 to Teodulo and entrusted to him a copy of a Decision of the Court of First Instance (CFI) of Tayabas dated April 21, 1925 recognizing his (Santiago) rights over Lot No. 379. 5 Since Teodulo was only 14 years old then, his father helped him cultivate the land.6 Their family thereafter cleared the land, built a house 7 and planted coconut trees, corn, palay and vegetables thereon.8 In 1960, Santiago executed an "Affidavit (quit-claim)" 9 ratifying the transfer of his rights over Lot No. 379 to Teodulo. Between 1960 and 1970, three conflagrations razed the land reducing the number of coconut trees growing therein to only 400, but by the time Teodulo testified in 1992, the remaining portions of the land was almost entirely cultivated and planted with coconuts, coffee, jackfruits, mangoes and vegetables. 10 From 1929, Teodulo and later, his wife and 11 children possessed the land as owners and declared the same for taxation, the earliest being in 1961.11 In 1970, Teodulo discovered that spouses Cipriano Hernandez and Julia Zoleta, respondents predecessors-ininterest, were able to obtain a title over Lot No. 379. He did not immediately file a case against respondents because he was advised to just remain on the land and pay the corresponding taxes thereon. 12 Respondents, on the other hand, claimed that on November 11, 1964, Santiago sold the questioned lot to their parents, the spouses Cipriano Hernandez and Julia Zoleta, for P9,000.00. 13 Respondents alleged that on April 21, 1925, the CFI of Tayabas rendered a Decision written in Spanish, declaring Lot No. 379 as a public land and recognizing Santiago as claimant thereof in Cadastral Proceeding No. 12. However, no title was issued to Santiago because he failed to file an Answer. Spouses Cipriano Hernandez and Julia Zoleta filed a motion to re-open Cadastral Proceeding No. 12, alleging that though no title was issued in the name of Santiago, the same decision is, nevertheless, proof that Santiago was in possession of Lot No. 379 since 1925 or for more than 30 years. Having succeeded in the rights of Santiago, the spouses prayed that Cadastral Proceeding No. 12 be re-opened and that the corresponding title over Lot No. 379 be issued in their name. On September 13, 1965, the CFI of Tayabas rendered a decision adjudicating Lot No. 379 in favor of the spouses, in whose name Original Certificate of Title (OCT) No. O1184414 was issued on the same date.15 Cipriano Hernandez planted coconut trees on the land through the help of a certain Fredo16 who was instituted as caretaker. In 1970, Fredo informed Cipriano Hernandez that he will no longer stay on the land because there are people instructing him to discontinue tilling the same. 17 After the death of the spouses,18 respondents executed a deed of partition over the subject lot and were issued TCT No. T- 237330 on June 28, 1988 in lieu of OCT No. O-11844. 19 LAW ON PROPERTY: QUIETING OF TITLE Page 18

Respondent Joaquin Hernandez (Joaquin) testified that in 1964, he accompanied his father in inspecting the lot which was then planted with coconut trees.20 Thereafter, he visited the land twice, once in 1966 and the other in 1970. From 1966 up to the time he testified, his family declared the lot for taxation and paid the taxes due thereon. 21 Joaquin explained that after the death of his father in 1971, he no longer visited the land and it was only when the complaint was filed against them when he learned that petitioners are in actual possession of the property. 22 He added that his siblings had planned to convert Lot No. 379 into a grazing land for cattle but decided to put it off for fear of the rampant operations then of the New Peoples Army between the years 1965-1970. 23 1avvphil.net On March 31, 1997, the trial court rendered a decision in favor of petitioners. It held that since the latter possessed the land in the concept of an owner since 1929, they became the owners thereof by acquisitive prescription after the lapse of 10 years, pursuant to the Code of Civil Procedure. Thus, when Santiago sold the lot to respondents parents in 1964, the former no longer had the right over the property and therefore transmitted no title to said respondents. The dispositive portion of the trial courts decision, reads: WHEREFORE, in the light of all the foregoing considerations judgment is hereby rendered in favor of the plaintiffs and against the defendants, to wit: 1. Declaring that the parcel of land (Lot No. 379 of the Cadastral Survey of Guinayangan, Cadastral Case No. 12, LRC Cadastral Record No. 557), situated in Brgy. Katimo, Tagkawayan, Quezon had been fraudulently, deceitfully and mistakenly registered in the names of the spouses Cipriano Hernandez and Julia Zoleta; 2. Declaring that herein defendants [heirs] of spouses Cipriano Hernandez and Julia Zoleta have no better rights than their parents/predecessors-in-interest, they having stepped only on (sic) their shoes; 3. Declaring that the plaintiff Rosita Victor Rumarate and substitute plaintiffs-[heirs] of the deceased Teodulo Rumarate are the true, real and legal owners/or the owners in fee simple absolute of the above described parcel of land; 4. Ordering the defendants to convey the above-described parcel of land to plaintiff Rosita Victor Rumarate and to the substitute plaintiffs (heirs) of the deceased Teodulo Rumarate; 5. Ordering the Register of Deeds for Quezon Province in Lucena City to cancel Transfer Certificate of Title No. T237330 and to issue in lieu thereof a new certificate of title in favor of plaintiff Rosita Victor Rumarate and the substitute plaintiffs (heirs) of the deceased plaintiff Teodulo Rumarate, in accordance with law and settled jurisprudence; and 6. Ordering the defendants to pay the costs of the suit. 1avvphil.net SO ORDERED.24 Respondents appealed to the Court of Appeals which on May 26, 2005, reversed and set aside the decision of the trial court. It ruled that Teodulo did not acquire title over Lot No. 379, either by donation or acquisitive prescription; that Teodulos bare allegation that Santiago orally bequeathed to him the litigated lot is insufficient to prove such transfer of ownership; and that even assuming that the property was truly donated by Santiago to Teodulo in 1929, or in the 1960 Affidavit, said conveyance is void for not complying with the formalities of a valid donation which require the donation and the acceptance thereof by the donee to be embodied in a public instrument. Both requirements, however, are absent in this case because in 1929, the alleged donation was not reduced to writing while the purported 1960 donation was never accepted in a public document by Teodulo. The appellate court thus surmised that since it was not established that Santiago donated Lot No. 379 to Teodulo, it follows that the latter also failed to prove that he possessed the land adversely, exclusively and in the concept of an owner, a vital requisite before one may acquire title by acquisitive prescription. In conclusion, the Court of Appeals ruled that even assuming further that Teodulo had a right over the property, his cause of action is now barred by laches because he filed an action only in 1992 notwithstanding knowledge as early as 1970 of the issuance of title in the name of spouses Cipriano Hernandez and Julia Zoleta. The decretal portion of the decision states:

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WHEREFORE, premises considered, the instant appeal is GRANTED. The assailed March 31, 1997 decision of the Regional Trial Court of Calauag, Quezon, Branch 63, in Civil Case No. C-964 is hereby REVERSED and SET ASIDE. No costs. SO ORDERED.25 Hence, the instant appeal. The issue to be resolved is to whom should Lot No. 379 be awarded? To petitioners who possessed and cultivated the lot since 1929 up to the present, but do not have a certificate of title over the property, or to respondents who have a certificate of title but are not in possession of the controverted lot? In an action for quieting of title, the court is tasked to determine the respective rights of the parties so that the complainant and those claiming under him may be forever free from any danger of hostile claim. 26 Under Article 47627 of the Civil Code, the remedy may be availed of only when, by reason of any instrument, record, claim, encumbrance or proceeding, which appears valid but is, in fact, invalid, ineffective, voidable or unenforceable, a cloud is thereby cast on the complainants title to real property or any interest therein. Article 477 of the same Code states that the plaintiff must have legal or equitable title to, or interest in the real property which is the subject matter of the suit. For an action to quiet title to prosper, two indispensable requisites must concur, namely: (1) the plaintiff or complainant has a legal or an equitable title to or interest in the real property subject of the action; and (2) the deed, claim, encumbrance or proceeding claimed to be casting cloud on his title must be shown to be in fact invalid or inoperative despite its prima facie appearance of validity or legal efficacy.28 In Evangelista v. Santiago,29 it was held that title to real property refers to that upon which ownership is based. It is the evidence of the right of the owner or the extent of his interest, by which means he can maintain control and, as a rule, assert a right to exclusive possession and enjoyment of the property. In the instant case, we find that Teodulos open, continuous, exclusive, notorious possession and occupation of Lot No. 379, in the concept of an owner for more than 30 years vested him and his heirs title over the said lot. The law applicable at the time Teodulo completed his 30-year possession (from 1929 to 1959) of Lot No. 379, in the concept of an owner was Sec. 48(b) of Commonwealth Act No. 141 or the Public Land Act, as amended by Republic Act (RA) No. 1942, effective June 22, 195730 which provides: Sec. 48. The following-described citizens of the Philippines, occupying lands of the public domain or claiming to own any such lands or an interest therein, but whose titles have not been perfected or completed, may apply to the Court of First Instance (now Regional Trial Courts) of the province where the land is located for confirmation of their claims and the issuance of a certificate of title thereafter, under the Land Registration Act (now Property Registration Decree), to wit: xxxx (b) Those who by themselves or through their predecessors-in-interest have been, in continuous, exclusive, and notorious possession and occupation of agricultural lands of the public domain, under a bona fide claim of acquisition or ownership, for at least thirty years immediately preceding the filing of the application for confirmation of title, except when prevented by war or force majeure. Those shall be conclusively presumed to have performed all the conditions essential to a government grant and shall be entitled to a certificate of title under the provisions of this chapter. When the conditions specified therein are complied with, the possessor is deemed to have acquired, by operation of law, a right to a government grant, without necessity of a certificate of title being issued, and the land ceases to be part of the public domain. The confirmation proceedings would, in truth be little more than a formality, at the most limited to ascertaining whether the possession claimed is of the required character and length of time; and registration thereunder would not confer title, but simply recognize a title already vested. The proceedings would not originally convert the land from public to private land, but only confirm such conversion already effected by operation of law from the moment the required period of possession became complete. 31

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In the instant case, the trial court gave full faith and credence to the testimony of Teodulo and his witnesses that his (Teodulos) possession of the land since 1929 was open, continuous, adverse, exclusive, and in the concept of an owner. It is a settled rule in civil cases as well as in criminal cases that in the matter of credibility of witnesses, the findings of the trial courts are given great weight and highest degree of respect by the appellate court considering that the latter is in a better position to decide the question, having heard the witnesses themselves and observed their deportment and manner of testifying during the trial. 32 A careful examination of the evidence on record shows that Teodulo possessed and occupied Lot No. 379 in the concept of an owner. Since 1929, Teodulo cultivated the controverted land, built his home, and raised his 11 children thereon. In 1957, he filed a homestead application over Lot No. 379 but failed to pursue the same. 33 After his demise, all his 11 children, the youngest being 28 years old, 34 continued to till the land. From 1929 to 1960, Santiago never challenged Teodulos possession of Lot No. 379 nor demanded or received the produce of said land. For 31 years Santiago never exercised any act of ownership over Lot No. 379. And, in 1960, he confirmed that he is no longer interested in asserting any right over the land by executing in favor of Teodulo a quitclaim. Indeed, all these prove that Teodulo possessed and cultivated the land as owner thereof since 1929. While the oral donation in 1929 as well as the 1960 quitclaim ceding Lot No. 379 to Teodulo are void for non-compliance with the formalities of donation, they nevertheless explain Teodulo and his familys long years of occupation and cultivation of said lot and the nature of their possession thereof. In Bautista v. Poblete,35 the Court sustained the registration of a parcel of land in the name of the successors-ininterest of the donee notwithstanding the invalidity of the donation inasmuch as said donee possessed the property in the concept of an owner. Thus There is no question that the donation in question is invalid because it involves an immovable property and the donation was not made in a public document as required by Article 633 of the old Civil Code, in connection with Article 1328 of the same Code (concerning gifts propter nuptias), but it does not follow that said donation may not serve as basis of acquisitive prescription when on the strength thereof the donee has taken possession of the property adversely and in the concept of owner. It follows therefore that Teodulos open, continuous, exclusive, and notorious possession and occupation of Lot No. 379 for 30 years, or from 1929 to 1959 in the concept of an owner, earned him title over the lot in accordance with Sec. 48 (b) of the Public Land Act. Considering that Lot No. 379 became the private property of Teodulo in 1959, Santiago had no more right to sell the same to spouses Cipriano Hernandez and Julia Zoleta in 1964. Consequently, the latter and herein respondents did not acquire ownership over Lot No. 379 and the titles issued in their name are void. Interestingly, respondents adopted the theory that Santiago acquired title over Lot No. 379 not from the April 21, 1925 Decision of the CFI of Tayabas which merely recognized his rights over said lot, but from his more than 30 years of possession since 1925 up to 1964 when he sold same lot to their (respondents) predecessors-in-interest, the spouses Cipriano Hernandez and Julia Zoleta. On the basis of said claim, said spouses filed an action for, and successfully obtained, confirmation of imperfect title over Lot No. 379, pursuant to Sec. 48 (b) of the Public Land Act. However, the records do not support the argument of respondents that Santiagos alleged possession and cultivation of Lot No. 379 is in the nature contemplated by the Public Land Act which requires more than constructive possession and casual cultivation. As explained by the Court in Director of Lands v. Intermediate Appellate Court:36 It must be underscored that the law speaks of "possession and occupation." Since these words are separated by the conjunction and, the clear intention of the law is not to make one synonymous with the other. Possession is broader than occupation because it includes constructive possession. When, therefore, the law adds the word occupation, it seeks to delimit the all-encompassing effect of constructive possession. Taken together with the words open, continuous, exclusive and notorious, the word occupation serves to highlight the fact that for one to qualify under paragraph (b) of the aforesaid section, his possession of the land must not be mere fiction. As this Court stated, through then Mr. Justice Jose P. Laurel, in Lasam vs. The Director of Lands: "x x x Counsel for the applicant invokes the doctrine laid down by us in Ramos vs. Director of Lands (39 Phil. 175, 180). (See also Rosales vs. Director of Lands, 51 Phil. 302, 304). But it should be observed that the application of the doctrine of constructive possession in that case is subject to certain qualifications, and this court was careful to observe that among these qualifications is one particularly relating to the size of the tract in controversy with reference LAW ON PROPERTY: QUIETING OF TITLE Page 21

to the portion actually in possession of the claimant. While, therefore, possession in the eyes of the law does not mean that a man has to have his feet on every square meter of ground before it can be said that he is in possession, possession under paragraph 6 of section 54 of Act No. 926, as amended by paragraph (b) of section 45 of Act No. 2874, is not gained by mere nominal claim. The mere planting of a sign or symbol of possession cannot justify a Magellan-like claim of dominion over an immense tract of territory. Possession as a means of acquiring ownership, while it may be constructive, is not a mere fiction x x x." Earlier, in Ramirez vs. The Director of Lands, this Court noted: "x x x The mere fact of declaring uncultivated land for taxation purposes and visiting it every once in a while, as was done by him, does not constitute acts of possession." In the instant case, Santiagos short-lived possession and cultivation of Lot No. 379 could not vest him title. While he tilled the land in 1925, he ceased to possess and cultivate the same since 1928. He abandoned the property and allowed Teodulo to exercise all acts of ownership. His brief possession of Lot No. 379 could not thus vest him title. Nemo potest plus juris ad alium transferre quam ipse habet. No one can transfer a greater right to another than he himself has. Hence, spouses Cipriano Hernandez and Julia Zoleta and herein respondents did not acquire any right over the questioned lot and the title issued in their names are void, because of the legal truism that the spring cannot rise higher than the source.37 Furthermore, spouses Cipriano Hernandez and Julia Zoleta cannot be considered as purchasers in good faith because they had knowledge of facts and circumstances that would impel a reasonably cautious man to make such inquiry. 38 The Court notes that Santiago was not residing in Lot No. 379 at the time of the sale. He was already 81 years old, too old to cultivate and maintain an 18-hectare land. These circumstances should have prompted the spouses to further inquire who was actually tilling the land. Had they done so, they would have found that Teodulo and his family are the ones possessing and cultivating the land as owners thereof. In the same vein, respondents could not be considered as third persons or purchasers in good faith and for value or those who buy the property and pay a full and fair price for the same 39 because they merely inherited Lot No. 379 from spouses Cipriano Hernandez and Julia Zoleta. Then too, even if Santiago acquired title over Lot No. 379 by virtue of the April 21, 1925 Decision of the CFI of Tayabas, and not on account of his alleged 30-year possession thereof, we will still arrive at the same conclusion. This is so because the declaration of this Court that petitioners are the rightful owners of the controverted lot is based on Teodulos own possession and occupation of said lot under a bona fide claim of acquisition of ownership, regardless of the manner by which Santiago acquired ownership over same lot. On the issue of prescription, the settled rule is that an action for quieting of title is imprescriptible, as in the instant case, where the person seeking relief is in possession of the disputed property. A person in actual possession of a piece of land under claim of ownership may wait until his possession is disturbed or his title is attacked before taking steps to vindicate his right, and that his undisturbed possession gives him the continuing right to seek the aid of a court of equity to ascertain and determine the nature of the adverse claim of a third party and its effect on his title. 40 Considering that petitioners herein continuously possessed Lot No. 379 since 1929 up to the present, their right to institute a suit to clear the cloud over their title cannot be barred by the statute of limitations. Neither could petitioners action be barred by laches because they continuously enjoyed the possession of the land and harvested the fruits thereof up to the present to the exclusion of and without any interference from respondents. They cannot therefore be said to have slept on their rights as they in fact exercised the same by continuously possessing Lot No. 379. On the contrary, we find that it is respondents who are actually guilty of laches. Though not specifically pleaded, the Court can properly address the issue of laches based on petitioners allegation in the complaint that "[n]either spouses Cipriano Hernandez and Julia Zoleta x x x nor [herein respondents] had taken steps to possess or lay adverse claim to said parcel of land from the date of their registration of title in November, 1965 up to the present." 41 Such averment is sufficient to impute abandonment of right on the part of respondents. At any rate, laches need not be specifically pleaded. On its own initiative, a court may consider it in determining the rights of the parties. 42

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The failure or neglect, for an unreasonable length of time to do that which by exercising due diligence could or should have been done earlier constitutes laches. It is negligence or omission to assert a right within a reasonable time, warranting a presumption that the party entitled to assert it has either abandoned it or declined to assert it. While it is by express provision of law that no title to registered land in derogation of that of the registered owner shall be acquired by prescription or adverse possession, it is likewise an enshrined rule that even a registered owner may be barred from recovering possession of property by virtue of laches. 43 In applying the doctrine of laches, we have ruled that where a party allows the following number of years to lapse from the emergence of his cause of action without enforcing his claim, laches sets in: 36 years; 12 years; 50 years; 34 years; 37 years; 32 years; 20 years; 47 years; 11 years; 25 years; 40 years; 19 years; 27 years; 7 years; 44 years; 4 years; and 67 years.44 The elements of laches are: (1) conduct of a party on the basis of which the other party seeks a remedy; (2) delay in asserting ones rights, despite having had knowledge or notice of the other partys conduct and having been afforded an opportunity to institute a suit; (3) lack of knowledge or notice on the part of a party that the person against whom laches is imputed would assert the right; and (4) injury or prejudice to the party asserting laches in the event the suit is allowed to prosper.45 All these elements are present in this case. Petitioners continuous possession and occupation of Lot No. 379 should have prompted the respondents to file an action against petitioners, but they chose not to. Respondents cannot deny knowledge of said possession by petitioners as they even asserted in their Answer that in 1970, Teodulo ousted the tenant they (respondents) instituted in the lot. From 1970 up to the filing of petitioners complaint in 1992, or after 22 years, respondents never bothered to assert any right over Lot No. 379. Respondent Joaquin Hernandez testified that he and his siblings had a plan to convert the land into a grazing land for cattle but decided to put it off for fear of the rampant operations of the New Peoples Army between the years 1965-1970. However, even after said years, respondents took no step to implement their plan. Worse, among the siblings of spouses Cipriano Hernandez and Julia Zoleta who are all living in the Philippines,46 only Joaquin Hernandez visited the land and only thrice, i.e., once in each years of 1964, 1966 and 1970. Thereafter, not one of them paid visit to Lot No. 379, up to the time Joaquin Hernandez testified in 1996,47 despite the fact that two of them are living only in Calauag, Quezon; one in Agdangan, Quezon; 48 and two in Lucena City.49 Neither did they send a notice or correspondence to petitioners invoking their right over the property. From all indications, the late spouses Cipriano Hernandez and Julia Zoleta as well respondents, have neglected Lot No. 379. Were it not for this action instituted by petitioners in 1992, their conflicting claims over the property could not have been settled. It goes without saying that to lose a property that has been in the family from 1929 up to the present, or for 77 years will certainly cause irreparable pecuniary and moral injury to petitioners, especially so if the same ancestral land will be lost under most unfair circumstances in favor of respondents who appear to have no real interest in cultivating the same. Finally, payment of taxes alone will not save the day for respondents. Only a positive and categorical assertion of their supposed rights against petitioners would rule out the application of laches. It means taking the offensive by instituting legal means to wrest possession of the property which, however, is absent in this case. Respondents payment of taxes alone, without possession could hardly be construed as an exercise of ownership. What stands out is their overwhelming passivity by allowing petitioners to exercise acts of ownership and to enjoy the fruits of the litigated lot for 22 years without any interference. In sum, the Court finds that Lot No. 379 should be adjudicated in favor of petitioners. One last point. Notwithstanding this Courts declaration that Lot No. 379 should be awarded in favor of petitioners, their title over the same is imperfect and is still subject to the filing of the proper application for confirmation of title under Section 48 (b) of the Public Land Act, where the State and other oppositors may be given the chance to be heard. It was therefore premature for the trial court to direct the Register of Deeds of Lucena City to issue a certificate of title in the name of petitioners. Nevertheless, the imperfect title of petitioners over Lot No. 379 is enough to defeat the certificate of title issued to respondents.50 WHEREFORE, the petition is GRANTED and the May 26, 2005 Decision of the Court of Appeals in C.A. GR. CV No. 57053, is REVERSED and SET ASIDE. The March 31, 1997 Decision of the Regional Trial Court of Calauag, Quezon, Branch 63, in Civil Case No. C-964, awarding Lot No. 379 in favor petitioners and ordering the cancellation of LAW ON PROPERTY: QUIETING OF TITLE Page 23

respondents Transfer Certificate of Title No. T- 237330, is REINSTATED with the MODIFICATION deleting the trial courts order directing the Register of Deed of Lucena City to issue a certificate of title in the name of petitioners. SO ORDERED. CONSUELO YNARES-SANTIAGO Associate Justice

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