G.R. No. 173289 February 17, 2010
48 (b)3 of the
ELAND PHILIPPINES, INC., Petitioner,
vs.
AZUCENA GARCIA, ELINO FAJARDO, AND HEIR OF
TIBURCIO MALABANAN NAMED TERESA
MALABANAN, Respondents.
DECISION
PERALTA, J.:
This is a Petition for Review on Certiorari under Rule 45 of the
Rules of Court, seeking to reverse and set aside the
decision1 dated February 28, 2006 of the Court of Appeals
(CA) in CA-G.R. CV No. 67417, which dismissed the appeal of
petitioner Eland Philippines, Inc. and affirmed the Resolutions
dated November 3, 1999 and June 28, 2006 of Branch 18,
Regional Trial Court (RTC) of Tagaytay City.
The facts of the case, as shown in the records, are the
following:
Respondents Azucena Garcia, Elino Fajardo, and Teresa
Malabanan, the heir of Tiburcio Malabanan, filed a
Complaint2 dated March 2, 1998 for Quieting of Title with Writ
of Preliminary Injunction with the RTC, Branch XVIII, Tagaytay
City against petitioner Eland Philippines, Inc. Respondents
claimed that they are the owners, in fee simple title, of a parcel
of land identified as Lot 9250 Cad-355, Tagaytay Cadastre,
Plan Ap-04-008367, situated in Barangay Iruhin, Tagaytay
City, containing an area of Two Hundred Forty-Four Thousand
One Hundred Twelve (244,112) square meters, by occupation
and possession under the provisions of Sec.
Public Land Law or Commonwealth Act No. 141, as amended.
For having been in continuous, public, and adverse
possession as owners of the said lot for at least thirty years,
respondents stated that they were not aware of any person or
entity who had a legal or equitable interest or claim on the
same lot until the time they were requesting that the lot be
declared for tax purposes. They found out that the lot was the
subject of a land registration proceeding that had already been
decided by the same court4 where their complaint was filed.
They also found out that Decree No. N-217313, LRC Record
No. N-62686, was already issued on August 20, 1997 to the
petitioner pursuant to the Decision dated June 7, 1994 of the
same court. They averred that they were not notified of the
said land registration case; thus, they claimed the presence of
misrepresentation amounting to actual or extrinsic fraud. Thus,
they argued that they were also entitled to a writ of preliminary
injunction in order to restrain or enjoin petitioner, its privies,
agents, representatives, and all other persons acting on its
behalf, to refrain from committing acts of dispossession on the
subject lot.
Summons, together with a copy of the complaint, were served
on the petitioner on April 7, 1998. On April 29, 1998, petitioner
filed an Entry of Appearance with Motion for Extension of
Time,5 which the trial court granted6 for a period of ten (10)
days within which to file a responsive pleading. Petitioner filed
a Second Motion for Extension of Time to File Answer7 dated
April 29, 1998, which the trial court likewise granted.8
Thereafter, petitioner filed a Motion to Dismiss9 dated May 9,
1998, stating that the pleading asserting the claim of
respondents stated no cause of action, and that the latter were
not entitled to the issuance of a writ of preliminary injunction,
setting the same for hearing on May 21, 1998. On the date of
the hearing, the trial court issued an Order,10 which granted
the respondents ten (10) days from that day to file a comment,
and set the date of the hearing on July 23, 1998. Respondents
filed a Motion to Admit Comment/Opposition to Defendant
Eland,11 together with the corresponding
Comment/Opposition12 dated June 8, 1998.
On the scheduled hearing of September 23, 1998, the trial
court issued an Order,13 considering the Motion to Dismiss
submitted for resolution due to the non-appearance of the
parties and their respective counsels. The said motion was
eventually denied by the trial court in an Order14 dated
September 25, 1998, ruling that the allegations in the
complaint established a cause of action and enjoined
petitioner Eland to file its answer to the complaint within ten
(10) days from receipt of the same. Petitioner then filed two
Motions for Extension to File an Answer.15
Petitioner, on November 9, 1998, filed a Motion for
Reconsideration16 of the trial court's Order dated September
25, 1998, denying the former's Motion to Dismiss. Again,
petitioner filed a Motion for Final Extension of Time to File
Answer17 dated November 6, 1998. Respondents filed their
Comment/Opposition to Motion for Reconsideration dated
November 24, 1998. Subsequently, the trial court denied
petitioner's motion for reconsideration in an Order18dated
January 11, 1999.
Meanwhile, respondents filed a Motion to Declare Defendant
Eland in Default19 dated November 17, 1998. On December 4,
1998 Petitioner Eland filed its Comment (on Plaintiff's Motion
to Declare Defendant Eland in Default)20dated December 2,
1998, while respondents filed a Reply to Comment (on
Plaintiff's Motion to Declare Defendant Eland in
Default)21 dated December 29, 1998. Thereafter, the trial court
issued an Order22 dated January 11, 1999 declaring the
petitioner in default and allowed the respondents to present
evidence ex parte. Petitioner filed a Motion for
Reconsideration (of the Order dated 11 January 1999)23 dated
February 5, 1999 on the trial court's denial of its motion to
dismiss and in declaring it in default. The trial court in an
Order24 dated March 18, 1999, denied the former and granted
the latter. In the same Order, the trial court admitted
petitioner's Answer Ad Cautelam.
Earlier, petitioner filed its Answer Ad Cautelam (With
Compulsory Counterclaim)25 dated November 12, 1998.
Respondents countered by filing a Motion to Expunge Eland's
Answer from the Records26 dated December 2, 1998.
Petitioner filed its Opposition (to Plaintiff's Motion to Expunge
Eland's Answer from the Records)27 dated December 21,
1998, as well as a Comment (on Plaintiff's Motion to Expunge
Eland's Answer from the Records)28 dated January 26, 1999.
Consequently, respondents filed a Motion to Set Presentation
of Evidence Ex Parte29 dated January 18, 1999, which was
granted in an Order30 dated January 22, 1999.
On January 28, 1999, respondents presented their evidence
before the Clerk of Court of the trial court which ended on
February 3, 1999; and, on February 10, 1999, respondents
filed their Formal Offer of Evidence.31 However, petitioner filed
an Urgent Motion to Suspend Plaintiff's Ex Parte Presentation
of Evidence32 dated February 8, 1999. In that regard, the trial
court issued an Order33 dated February 11, 1999 directing the
Clerk of Court to suspend the proceedings.
On May 14, 1999, respondents filed a Motion for
Clarification34 as to whether or not the evidence presented ex
parte was nullified by the admission of petitioner's Answer Ad
Cautelam. Petitioner filed its Comment35 dated May 13, 1999
on the said motion for clarification.
A pre-trial conference was scheduled on May 27, 1999,
wherein the parties submitted their pre-trial briefs.36However,
petitioner filed a Motion to Suspend Proceedings37 dated May
24, 1999 on the ground that the same petitioner had filed a
petition for certiorari with the CA, asking for the nullification of
the Order dated March 18, 1999 of the trial court and for the
affirmation of its earlier Order denying petitioner's Motion to
Dismiss. The petition for certiorari was subsequently denied;
and a copy of the Resolution38 dated June 14, 1999 was
received by the trial court. Hence, in an Order39 dated July 7,
1999, the trial court ruled that the reception of evidence
already presented by the respondents before the Clerk of
Court remained as part of the records of the case, and that the
petitioner had the right to cross-examine the witness and to
comment on the documentary exhibits already presented.
Consequently, petitioner filed a Motion for
Reconsideration40 dated July 19, 1999, but it was denied by
the trial court in an Omnibus Order41 dated September 14,
1999.
Eventually, respondents filed a Motion for Summary
Judgment42 dated August 5, 1999, while petitioner filed its
Opposition43 to the Motion dated August 31, 1999. In its
Resolution44 dated November 3, 1999, the trial court found
favor on the respondents. The dispositive portion of the
Resolution reads:
WHEREFORE, premises considered, the motion for summary
judgment is hereby GRANTED and it is hereby adjudged that:
1. Plaintiffs are the absolute owners and rightful
possessors of Lot 9250, CAD-355, Tagaytay Cadastre,
subject to the rights of occupancy of the farm workers
on the one-third area thereof;
2. The Judgment dated June 7, 1994 in Land
Registration Case No. TG-423 is set aside and the
Decree No. N-217313, LRC Record No. N-62686 dated
August 20, 1997 is null and void;
3. The Original Transfer Certificate of Title is ordered to
be canceled, as well as tax declaration covering Lot
9250, Cad-355.
SO ORDERED.
Petitioner appealed the Resolution of the trial court with the
CA, which dismissed it in a Decision dated February 28, 2006,
which reads:
WHEREFORE, for lack of merit, the appeal is DISMISSED.
The assailed Resolution dated November 3, 1999, of the RTC,
Branch 18, Tagaytay City, in Civil Case No. TG-1784, is
AFFIRMED. No pronouncement as to cost.
SO ORDERED.
Hence, the present petition.
The grounds relied upon by the petitioner are the following:
5.1 THE COURT OF APPEALS ACTED IN A MANNER
NOT IN ACCORD WITH LAW AND WITH THE
APPLICABLE DECISIONS OF THIS HONORABLE
COURT WHEN IT RULED THAT RESPONDENTS'
MOTION FOR SUMMARY JUDGMENT DATED
AUGUST 05, 1999 DID NOT VIOLATE THE TEN (10)-
DAY NOTICE RULE UNDER SECTION 3, RULE 35
OF THE 1997 RULES OF CIVIL PROCEDURE.
5.2 THE COURT OF APPEALS ACTED IN A MANNER
NOT IN ACCORD WITH LAW AND WITH THE
APPLICABLE DECISIONS OF THIS HONORABLE
COURT WHEN IT RULED THAT A MOTION FOR
SUMMARY JUDGMENT IS PROPER IN AN ACTION
FOR QUIETING OF TITLE.
5.3 THE COURT OF APPEALS ACTED IN A MANNER
NOT IN ACCORD WITH LAW AND WITH THE
APPLICABLE DECISIONS OF THIS HONORABLE
COURT WHEN IT RULED THAT THERE ARE NO
GENUINE FACTUAL AND TRIABLE ISSUES IN CIVIL
CASE NO. TG-1784.
5.4 THE COURT OF APPEALS ACTED IN A MANNER
NOT IN ACCORD WITH LAW AND WITH THE
APPLICABLE DECISIONS OF THIS HONORABLE
COURT WHEN IT UPHELD THE RESOLUTION
DATED NOVEMBER 03, 1999 OF THE COURT A
QUO, BASED ON TESTIMONIES OF
RESPONDENTS' WITNESSES TAKEN WITHOUT
GRANTING HEREIN PETITIONER THE RIGHT TO
CROSS-EXAMINE AND UPON DOCUMENTARY
EXHIBITS PRESENTED BUT NOT ADMITTED AS
EVIDENCE.
5.5 THE COURT OF APPEALS ACTED IN A MANNER
NOT IN ACCORD WITH LAW AND WITH THE
APPLICABLE DECISIONS OF THIS HONORABLE
COURT WHEN IT UPHELD THE RESOLUTION
DATED NOVEMBER 03, 1999 OF THE COURT A
QUO BASED ON FALSIFIED "EVIDENCE."
5.6 THE COURT OF APPEALS ACTED IN A MANNER
NOT IN ACCORD WITH LAW AND WITH THE
APPLICABLE DECISIONS OF THIS HONORABLE
COURT WHEN IT FAILED TO RULE THAT THE
COURT A QUO PATENTLY DEPRIVED PETITIONER
OF ITS RIGHT TO DUE PROCESS IN RENDERING
ITS SUMMARY JUDGMENT.
5.7 THE COURT OF APPEALS ACTED IN A MANNER
NOT IN ACCORD WITH LAW AND WITH THE
APPLICABLE DECISIONS OF THIS HONORABLE
COURT WHEN IT HELD THAT THE COURT A QUO
HAS JURISDICTION TO CANCEL PETITIONER'S
ORIGINAL CERTIFICATE OF TITLE (OCT) NO. 0-660
IN AN ACTION TO QUIET TITLE.
According to the petitioner, a motion for summary judgment
must be served at least ten (10) days before the date set for
hearing thereof, and that a hearing must be held to hear the
parties on the propriety of a summary judgment, per Sec. 3 of
Rule 35 of the Revised Rules of Court, which was not
observed because the petitioner received a copy of the
respondents' motion for summary judgment only on August 20,
1999, or the very same day that the motion was set for
hearing. Petitioner further claims that the trial court never
conducted any hearing on the motion for summary judgment.
Petitioner also argued that a summary judgment is only
available to a claimant seeking to recover upon a claim,
counterclaim or cross-claim or to obtain a declaratory relief,
and does not include cases for quieting of title. Furthermore,
petitioner also averred that a summary judgment has no place
in a case where genuine factual and triable issues exist, like in
the present case. It added that the genuine and triable issues
were all raised in its Answer Ad Cautelam.
Another ground relied upon by petitioner is its failure to cross-
examine the witnesses for the respondents without fault on its
part. It also stated that the trial court did not issue any order
admitting in evidence the documentary exhibits presented by
the respondents. Hence, according to the petitioner, the trial
court gravely erred in relying upon the testimonies of the
witnesses for the respondents, without having the latter cross-
examined; and upon the documentary exhibits presented but
not admitted as evidence.
Petitioner further claimed that the trial court based its
Resolution dated November 3, 1999 on falsified evidence.
Lastly, petitioner raised the issue that by rendering summary
judgment, the trial court deprived the former of its right to due
process.
Respondents, in their Comment45 dated October 16, 2006,
countered the first issue raised by the petitioner, stating that
their filing of the motion for summary judgment fourteen (14)
days before the requested hearing of the same motion was in
compliance with Sec. 3, Rule 35 of the Rules of Court.
As to the second and third issues, respondents argued that
petitioner had a constricted perception of the coverage of the
Rules of Summary Judgment, and that the latter's citation of
cases decided by this Court showed the diverse causes of
action that could be the subject matters of summary judgment.
Respondents also posited that petitioner's statements in its
Answer Ad Cautelam, although denominated as Specific
Denial, were really general denials that did not comply with the
provisions of Section 10, Rule 8 of the Rules of Court.
Anent the fourth and fifth issues, respondents claimed that
despite the opportunity, or the right allowed in the Order dated
July 17, 1999 of the trial court, for the petitioner to cross-
examine respondents' witnesses and to comment on the
documentary evidence presented ex parte after the default
order against the same petitioner, the latter evasively moved
to set aside respondents' evidence in order to suspend further
proceedings that were intended to abort the pre-trial
conference. They added that petitioner neglected to avail itself
of, or to comply with, the prescription of the rules found in Rule
35 of the Rules of Court by opting not to avail itself of the
hearing of its opposition to the summary judgment after
receiving the Order dated August 20, 1999; by failing to serve
opposing affidavit, deposition or admission in the records; and
by not objecting to the decretal portion of the said Order dated
August 20, 1999, which stated that the motion for summary
judgment has been submitted for resolution without further
argument. With regard to the contention of the petitioner that
the trial court wrongly appreciated falsified evidence,
respondents asserted that petitioner's counsel failed to study
carefully the records of the proceedings for the presentation of
the evidence ex parte to be able to know that it was not only a
single-day proceeding, and that more than one witness had
been presented. They further averred that the trial court did
not only rely on the photographs of the houses of the
occupants of the property in question.
Finally, as to the sixth and seventh issues, respondents
asseverated that their complaint alleged joint causes of action
for quieting of title under Art. 476 of the New Civil Code and for
the review of the decree of registration pursuant to Sec. 32 of
the Property Registration Decree or P.D. No. 1529, because
they are complimentary with each other.
The petition is impressed with merit.
The basic contention that must be resolved by this Court is the
propriety of the summary judgment in this particular case of
quieting of title.
Rule 35 of the 1997 Rules of Civil Procedure provides:
SEC. 1. Summary judgment for claimant. - A party seeking to
recover upon a claim, counterclaim, or cross-claim or to obtain
a declaratory relief may, at any time after the pleading in
answer thereto has been served, move with supporting
affidavits for a summary judgment in his favor upon all or any
part thereof
SEC. 3. Motion and proceedings thereon. - The motion shall
be served at least ten (10) days before the time specified for
the hearing. The adverse party prior to the day of hearing may
serve opposing affidavits. After the hearing, the judgment
sought shall be rendered forthwith if the pleading, depositions,
and admissions on file together with the affidavits, show that,
except as to the amount of damages, there is no genuine
issue as to any material fact and that the moving party is
entitled to a judgment as a matter of law.46
In the present case, it was the respondents who moved for a
summary judgment.
Petitioner contended that the ten-day notice rule was violated,
because the copy of the motion for summary judgment was
served only on August 20, 1999 or on the same day it was set
for hearing. It also added that even if the petitioner received a
copy of the motion only on August 20, 1999, there was no
hearing conducted on that date because the trial court issued
an order giving petitioner 10 days within which to file its
comment or opposition.
The above specific contention, however, is misguided. The CA
was correct in its observation that there was substantial
compliance with due process. The CA ruled, as the records
show, that the ten-day notice rule was substantially complied
with because when the respondents filed the motion for
summary judgment on August 9, 1999, they furnished
petitioner with a copy thereof on the same day as shown in the
registry receipt and that the motion was set for hearing on
August 20, 1999, or 10 days from the date of the filing thereof.
Due process, a constitutional precept, does not, therefore,
always and in all situations a trial-type proceeding. The
essence of due process is found in the reasonable opportunity
to be heard and submit one's evidence in support of his
defense. What the law prohibits is not merely the absence of
previous notice, but the absence thereof and the lack of
opportunity to be heard.47
Petitioner further argues that summary judgment is not proper
in an action for quieting of title. This particular argument,
however, is misplaced. This Court has already ruled that any
action can be the subject of a summary judgment with the sole
exception of actions for annulment of marriage or declaration
of its nullity or for legal separation.48
Proceeding to the main issue, this Court finds that the grant of
summary judgment was not proper. A summary judgment is
permitted only if there is no genuine issue as to any material
fact and a moving party is entitled to a judgment as a matter of
law. A summary judgment is proper if, while the pleadings on
their face appear to raise issues, the affidavits, depositions,
and admissions presented by the moving party show that such
issues are not genuine.49
It must be remembered that the non-existence of a genuine
issue is the determining factor in granting a motion for
summary judgment, and the movant has the burden of
proving such nonexistence. The trial court found no genuine
issue as to any material fact that would necessitate conducting
a full-blown trial. However, a careful study of the case shows
otherwise.
In their motion for summary judgment, the respondents failed
to clearly demonstrate the absence of any genuine issue of
fact. They merely reiterated their averments in the complaint
for quieting of title and opposed some issues raised by the
petitioner in its Answer Ad Cautelam, to wit:
Nonetheless, going by the records of the admitted and
uncontroverted facts and facts established there is no more
litigious or genuine issue of basic fact to be the subject of
further trial on the merits.
The first defense as to the identity of the subject property, the
issue has already become nil because of not only the lack of
seriousness in the allegations but also because the identity of
the subject parcel of land Lot 9250 was proven by the
approved plan Ap-04-008367 that was already presented and
offered in evidence as Exhibit "B" for the plaintiffs.
The second defense that plaintiffs' claim of the property is
barred by prior judgment rule is unavailing considering that the
vital documentary evidence they presented in Land
Registration Case No. TG-423 before this Honorable Court the
markings and descriptions of such documents are stated in the
Judgment quoted as follows:
(1) Tax Declaration No. 015224-A (Exhibit "Q"; x x x.
(2) Tax Declaration No. 05019-B (Exhibit "R"; x x x.
(3) Tax Declaration No. 01926-B (Exhibit "S"; x x x.
(4) Tax Declaration No. GR-007-0007 (Exhibit "T" x x x.
are the very documentary evidence adopted and relied upon
by the plaintiffs in seeking the review and nullity of the Decree
No. 217313 issued on August 20, 1997 under LRC Record No.
N-62686 pursuant to the Judgment dated June 7, 1994
rendered by this Honorable Court penned by the acting
presiding Judge Eleuterio F. Guerrero in said Land
Registration Case No. TG-423.
On the other hand, as to the gravamen of the claims in the
complaint, the plaintiffs have presented clear and convincing
evidence as the well-nigh or almost incontrovertible evidence
of a registerable title to the subject land in the proceedings
conducted on the reception of evidence ex-parte for the
plaintiffs establishing in detail the specifications of continuous,
open, exclusive possession as aspects of acquisitive
prescription as confirmed in the affidavit herein attached as
Annex "A";
In ruling that there was indeed no genuine issue involved, the
trial court merely stated that:
This Court, going by the records, observed keenly that
plaintiffs’ cause of action for quieting of title on the disputed
parcel of land is based on the alleged fraud in the
substitution of their landholdings of Lot 9250, Cad 355,
Tagaytay Cadastre containing only an area of 244,112 square
meters with Lot 9121, Cad 335, Tagaytay Cadastre, containing
only an area of 19,356 square meters. While defendant Eland
in its answer practically and mainly interposed the defenses of:
(a) the parcel of land being claimed by the plaintiffs is not the
parcel of land subject matter of Land Registration Case No.
TG-423; (b) the claim of the plaintiffs is barred by prior
judgment of this Court in said Land Registration Case; and (c)
plaintiffs' complaint is barred by the Statute of Limitation since
Original Certificate of Title No. 0-660 has become
incontrovertible.
Cross-reference of the above-cited Land Registration Case
No. TG-423 that was decided previously by this Court with the
case at bench was imperatively made by this Court. Being
minded that the Court has and can take judicial notice of the
said land registration case, this Court observed that there is no
genuine issue of fact to be tried on the merits. Firstly, because
the supposed identity crisis of the controverted parcel of land
covered by the Land Registration Case No. TG-423 with the
subject parcel of land is established by Plan Ap-04-006275
(Exhibit "N") LRC Case No. 423 and by Plan A04 008367
(Exhibit "B" of the plaintiffs) and the Technical Description of
Lot 9250, Cad 355 (Exhibit "B-1" of the plaintiffs). Secondly,
the prior judgment rule cannot be availed of by defendant
Eland since not only intrinsic fraud but extrinsic fraud were
alleged in and established by the records. (Heirs of Manuel
Roxas v. Court of Appeals, G. R. No. 1184436, pro. March 21,
1997). Thirdly, it is incontrovertible that the complaint in this
case seeking to review the judgment and annul the decree
was filed on March 5, 1998 or within one (1) year from August
20, 1997 or the date of issuance of Decree No. 217313, LRC
Record No. N-62686, hence, the Original Certificate of Title
No. 0-660 issued to defendant Eland has not attained
incontrovertibility. (Heirs of Manuel Roxas v. Court of Appeals,
G.R. No. 118436, prom. March 21, 1997).
Notwithstanding, the issue of possession is a question of
fact by the interaction of the basic pleadings, the
observation of this Court is that the plaintiffs were able to
prove by the well-nigh incontrovertible evidence, the aspects
of possession in accordance with Section 48 (b) of
Commonwealth Act 141, as amended, as hereinafter
illustrated.
The CA, in affirming the above Resolution of the trial court,
propounded thus:
The contention of defendant-appellant is untenable. Summary
judgment is not only limited to solving actions involving money
claims. Under Rule 35 of the 1997 Rules of Court, except as to
the amount of damages, when there is no genuine issue as to
any material fact and the moving party is entitled to a judgment
as a matter of law, summary judgment may be allowed. The
term "genuine issue" has been defined as an issue of fact
which calls for the presentation of evidence as distinguished
from an issue which is sham, fictitious, contrived, set up in bad
faith and patently unsubstantial so as not to constitute a
genuine issue for trial.
Thus, under the aforecited rule, summary judgment is
appropriate when there are no genuine issues of fact, which
call for the presentation of evidence in a full-blown trial. Thus,
even if on their face the pleadings appear to raise issues, but
when the affidavits, depositions and admissions show that
such issues are not genuine, then summary judgment as
prescribed by the rules must ensue as a matter of law.
It should be stressed that the court a quo which rendered the
assailed resolution in Civil Case No. TG-1784 was the very
court that decided the LRC Case No. TG-423. Such being the
case, the court a quo was privy to all relevant facts and rulings
pertaining to LRC Case No. TG-423 which it considered and
applied to this case. Thus, where all the facts are within the
judicial knowledge of the court, summary judgment may be
granted as a matter of right.
On the contrary, in petitioner's Answer Ad Cautelam, genuine,
factual and triable issues were raised, aside from specifically
denying all the allegations in the complaint, thus:
2. SPECIFIC DENIALS
2.1 Answering defendant specifically denies the
allegations contained in paragraphs 1 and 3 of the
Complaint insofar as it alleges the personal
circumstances of the plaintiff and one A. F.
Development Corporation for lack of knowledge or
information sufficient to form a belief as to the truth
thereof.
2.2 Answering defendant specifically denies the
allegations contained in paragraphs 4, 5, 6 and 7 of the
Complaint for lack of knowledge or information
sufficient to form a belief as to the truth of said
allegations. And if the property referred to in said
paragraphs is that parcel of land which was the subject
matter of Land Registration Case No. TG-423 which
was previously decided by this Honorable Court with
finality, said allegations are likewise specifically denied
for the obvious reason that the said property had
already been adjudged with finality by no less than this
Honorable Court as absolutely owned by herein
answering defendant as will be further discussed
hereunder.
2.3 Answering defendant specifically denies the
allegations contained in paragraph 8 of the Complaint
insofar as it alleged that "(u)pon exercise of further
circumspection, counsel for the plaintiffs once followed-
up in writing the 1994 request of the plaintiffs to have
the subject parcel of land be declared for taxation
purposes" and insofar as it is made to appear that
parcel of land being claimed by the plaintiffs is the
same parcel of land subject matter of Land Registration
Case No. TG-423 for lack of knowledge or information
sufficient to form a belief as to the truth thereof and for
the reason that the names of the herein plaintiffs were
never mentioned during the entire proceedings in said
land registration case and by reason of the Affirmative
Allegations contained hereunder.
2.4 Answering defendant specifically denies the
allegations contained in paragraphs 9, 10, 10 (a), 10
(b), 10 (c), 10 (d), 10 (e), 10 (f), 10 (g), 10 (h), and 11
for the reason that there is no showing that the parcel
of land being claimed by the plaintiff is the same parcel
of land which was the subject matter of Land
Registration Case No. TG- 423, and in the remote
possibility that the parcel of land being claimed by the
plaintiffs is the same as that parcel of land subject of
Land Registration Case No. TG-423, the allegations
contained in said paragraphs are still specifically
denied for the reason that no less than the Honorable
Court had decided with finality that the parcel of land is
absolutely owned by herein defendant to the exclusion
of all other persons as attested to by the subsequent
issuance of an Original Certificate of Title in favor of
answering defendant and for reasons stated in the
Affirmative Allegations.
2.5 Answering defendant specifically denies the
allegations contained in paragraph 12 of the Complaint
for the obvious reason that it was the plaintiffs who
appear to have been sleeping on their rights
considering that up to the present they still do not have
any certificate of title covering the parcel of land they
are claiming in the instant case, while on the part of
herein defendant, no less than the Honorable Court
had adjudged with finality that the parcel of land subject
matter of Land Registration Case No. TG-423 is
absolutely owned by herein defendant.
2.6 Answering defendant specifically denies the
allegations contained in paragraph 13 of the complaint
for the reason that defendant has never ladgrabbed
any parcel of land belonging to others, much less from
the plaintiffs, and further, answering defendant
specifically denies the allegations therein that plaintiffs
engaged the services of a lawyer for a fee for lack of
knowledge r information sufficient to form a belief as to
the truth thereof.
2.7 Answering defendant specifically denies the
allegations contained in paragraphs 14, 15, 16, 17 and
18 of the Complaint for lack of knowledge or
information sufficient to form a belief as the truth
thereof.
2.8 Answering defendant specifically denies the
allegations contained in paragraphs IV (a) to IV (c) for
the reason that, as above-stated, if the parcel of land
being claimed by the plaintiffs is the same as that
parcel of land subject matter of Land Registration Case
No. TG-423, this Honorable Court had already decided
with finality that said parcel of land is absolutely owned
by herein answering defendant and additionally, for
those reasons stated in defendant's Motion to Dismiss.
2.9 Answering defendant specifically denies the
allegations contained in paragraph IV (d) of the
Complaint for lack of knowledge or information
sufficient to form a belief as to the truth thereof.
Special and affirmative defenses were also raised in
the same Answer Ad Cautelam, to wit:
xxxx
4.1 The pleading asserting the claim of the plaintiff
states no cause of action as asserted in the Motion To
Dismiss filed by herein answering defendant and for
the reason that there is no evidence whatsoever
showing or attesting to the fact that the parcel of land
being claimed by the plaintiffs in the Complaint is the
same parcel of land which was the subject matter of
Land Registration Case No. TG-423.
4.2 The complaint was barred by the prior judgment
rendered by this Honorable in Land Registration Case
No. TG-423.
4.3 The complaint is barred by the Statute of Limitation
in that OCT No. 0-660 had become incontrovertible by
virtue of the Torrens System of Registration; and to
allow plaintiffs to question the validity of answering
defendant's title through the instant complaint would be
a collateral of OCT No. 0-660 which is not permissible
under the law.
4.4 Plaintiffs are barred by their own acts and/or
omission from filing the present complaint under the
principles of estoppel and laches.
4.5 Plaintiffs does not to the Court with clean hands as
they appear to be well aware of the proceedings in said
Land Registration Case No. TG- 423 and inspite of
such knowledge, plaintiffs never bothered to present
their alleged claims in the proceedings.
4.6 Answering defendant has always acted with justice,
given everyone his due, and observed honesty and
good faith in his dealings.
Clearly, the facts pleaded by the respondents in their motion
for summary judgment have been duly disputed and contested
by petitioner, raising genuine issues that must be resolved
only after a full-blown trial. When the facts as pleaded by the
parties are disputed or contested, proceedings for summary
judgment cannot take the place of trial.50 In the present case,
the petitioner was able to point out the genuine issues. A
"genuine issue" is an issue of fact that requires the
presentation of evidence as distinguished from a sham,
fictitious, contrived or false claim.51
It is of utmost importance to remember that petitioner is
already the registered owner (Original Certificate of Title [OCT]
No. 0-660 issued by the Register of Deeds) of the parcel of
land in question, pursuant to a decree of registration (Decree
No. N-217313, LRC Record No. 62686) based on the ruling of
the same court that granted the summary judgment for the
quieting of title.
Incidentally, the findings of the trial court contained in the
disputed summary judgment were obtained through judicial
notice of the facts and rulings pertaining to that earlier case
(LRC Case No. TG-423) wherein the same trial court ruled in
favor of the petitioner. It is, therefore, disorienting that the
same trial court reversed its earlier ruling, which categorically
stated that:
x x x There is overwhelming evidence or proof on record that
the vendors listed in Exhibit "HH," with submarkings, are the
previous owners of the parcel of land mentioned in the same
deed of sale and aside form the tax declarations covering the
same property (Exhibits "Q" to "T," inclusive), the
uncontroverted testimony of Atty. Ruben Roxas establishes
beyond any shadow of doubt that applicant's (referring to
herein defendant-appellant) sellers/predecessors-in-interest
are the grandchildren, great grandchildren and great great
grandchildren of the spouses Lucio Petate and Maria Pobleta
Petate, the former owners of the same property, whose
ownership is further bolstered by tax receipts showing
payments of realty taxes (Exhibits "U" to "GG," inclusive, with
submarkings).
xxx
On the basis of the foregoing facts and circumstances, and
considering that applicant is a domestic corporation not
otherwise disqualified from owning real properties in the
Philippines, this Court finds that applicant has satisfied all the
conditions/requirements essential to the grant of its application
pursuant to the provisions of the Land Registration Law, as
amended, inspite of the opposition filed by the Heirs of the late
Doroteo Miranda. Hence, the grant of applicant's petition
appears to be inevitable.
WHEREFORE, this Court hereby approves the instant petition
for land registration and, thus, places under the operation of
Act 141, Act 496 and/or P.D. 1529, otherwise known as the
Property Registration Law, the land described in Plan Ap-04-
006275 and containing an area of Two Hundred Forty-Two
Thousand Seven Hundred Ninety-Four (242,794) square
meters, as supported by its technical description now forming
part of the record of this case, in addition to other proofs
adduced in the name of the applicant, ELAND PHILIPPINES,
INC., with principal office at No. 43 E. Rodriguez Ave. (España
Extension), Quezon City, Metro Manila.
Once this decision becomes final and executory, the
corresponding decree of registration shall forthwith issue.
SO ORDERED.
By granting the summary judgment, the trial court has in effect
annulled its former ruling based on a claim of possession and
ownership of the same land for more than thirty years without
the benefit of a full-blown trial. The fact that the respondents
seek to nullify the original certificate of title issued to the
petitioner on the claim that the former were in possession of
the same land for a number of years, is already a
clear indicium that a genuine issue of a material fact exists.
This, together with the failure of the respondents to show that
there were no genuine issues involved, should have been
enough for the trial court to give the motion for summary
judgment, filed by respondents, scant consideration. Trial
courts have limited authority to render summary judgments
and may do so only when there is clearly no genuine issue as
to any material fact.52
Based on the foregoing, this Court deems it necessary to
delve briefly on the nature of the action of quieting of title as
applied in this case. This Court's ruling in Calacala, et al. v.
Republic, et al.53 is instructive on this matter, thus:
To begin with, it bears emphasis that an action for quieting of
title is essentially a common law remedy grounded on equity.
As we held in Baricuatro, Jr. vs. CA:54
Regarding the nature of the action filed before the trial court,
quieting of title is a common law remedy for the removal of any
cloud upon or doubt or uncertainty with respect to title to real
property. Originating in equity jurisprudence, its purpose is to
secure ‘x x x an adjudication that a claim of title to or an
interest in property, adverse to that of the complainant, is
invalid, so that the complainant and those claiming under him
may be forever afterward free from any danger of hostile
claim.’ In an action for quieting of title, the competent court is
tasked to determine the respective rights of the complainant
and other claimants, ‘x x x not only to place things in their
proper place, to make the one who has no rights to said
immovable respect and not disturb the other, but also for the
benefit of both, so that he who has the right would see every
cloud of doubt over the property dissipated, and he could
afterwards without fear introduce the improvements he may
desire, to use, and even to abuse the property as he deems
best xxx.
Under Article 476 of the New 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 complainant’s title to real property or any
interest therein. The codal provision reads:
Article 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.
In turn, Article 477 of the same Code identifies the party who
may bring an action to quiet title, thus:
Article 477. The plaintiff must have legal or equitable title to, or
interest in the real property which is the subject-matter of the
action. He need not be in possession of said property.
It can thus be seen that for an action for quieting of title to
prosper, the plaintiff must first have a legal, or, at least, an
equitable title on the real property subject of the action and
that the alleged cloud on his title must be shown to be in fact
invalid. So it is that in Robles, et al. vs. CA,55 we ruled:
It is essential for the plaintiff or complainant to have a legal title
or an equitable title to or interest in the real property which is
the subject matter of the action. Also, the deed, claim,
encumbrance or proceeding that is being alleged as a cloud
on plaintiff’s title must be shown to be in fact invalid or
inoperative despite its prima facie appearance of validity or
legal efficacy.
Verily, for an action to quiet title to prosper, two (2)
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.
Respondents, in their Complaint, claim that they have become
the owners in fee-simple title of the subject land by occupation
and possession under the provisions of Sec. 48 (b) of the
Public Land Law or Commonwealth Act No. 141, as amended.
Thus, it appears that the first requisite has been satisfied.
Anent the second requisite, respondents enumerated several
facts that would tend to prove the invalidity of the claim of the
petitioner. All of these claims, which would correspond to the
two requisites for the quieting of title, are factual; and, as
discussed earlier, the petitioner interposed its objections and
duly disputed the said claims, thus, presenting genuine issues
that can only be resolved through a full-blown trial.
Anent the propriety of the filing of an action for the quieting of
title, the indefeasibility and incontrovertibility of the decree of
registration come into question. Under Sec. 32 of P.D. No.
1529 or the Property Registration Decree:
Section 32. Review of decree of registration; Innocent
purchaser for value. The decree of registration shall not be
reopened or revised by reason of absence, minority, or other
disability of any person adversely affected thereby, nor by any
proceeding in any court for reversing judgments, subject,
however, to the right of any person, including the government
and the branches thereof, deprived of land or of any estate or
interest therein by such adjudication or confirmation of title
obtained by actual fraud, to file in the proper Court of First
Instance a petition for reopening and review of the decree of
registration not later than one year from and after the date of
the entry of such decree of registration, but in no case shall
such petition be entertained by the court where an innocent
purchaser for value has acquired the land or an interest
therein, whose rights may be prejudiced. Whenever the phrase
"innocent purchaser for value" or an equivalent phrase occurs
in this Decree, it shall be deemed to include an innocent
lessee, mortgagee, or other encumbrancer for value.
Upon the expiration of said period of one year, the decree
of registration and the certificate of title issued shall
become incontrovertible. Any person aggrieved by such
decree of registration in any case may pursue his remedy by
action for damages against the applicant or any other persons
responsible for the fraud.
As borne out by the records and undisputed by the parties,
OCT No. 0-660 of petitioner was issued on August 29, 1997
pursuant to a Decree issued on August 20, 1997, while the
complaint for the quieting of title in Civil Case No. TG-1784
was filed and docketed on March 5, 1998; hence, applying the
above provisions, it would seem that the period of one (1) year
from the issuance of the decree of registration has not elapsed
for the review thereof. However, a closer examination of the
above provisions would clearly indicate that the action filed,
which was for quieting of title, was not the proper remedy.
Courts may reopen proceedings already closed by final
decision or decree when an application for review is filed by
the party aggrieved within one year from the issuance of the
decree of registration.56 However, the basis of the aggrieved
party must be anchored solely on actual fraud. Shedding light
on the matter is a discussion presented in one of the
recognized textbooks on property registration,57 citing
decisions of this Court, thus:
The right of a person deprived of land or of any estate or
interest therein by adjudication or confirmation of title obtained
by actual fraud is recognized by law as a valid and legal basis
for reopening and revising a decree of registration.58 One of
the remedies available to him is a petition for review. To
avail of a petition for review, the following requisites must be
satisfied:
(a) The petitioner must have an estate or interest in the
land;
(b) He must show actual fraud in the procurement of
the decree of registration;
(c) The petition must be filed within one year from the
issuance of the decree by the Land Registration
Authority; and
(d) The property has not yet passed to an innocent
purchaser for value.59
A mere claim of ownership is not sufficient to avoid a
certificate of title obtained under the Torrens system. An
important feature of a certificate of title is its finality. The
proceedings whereby such a title is obtained are directed
against all persons, known or unknown, whether actually
served with notice or not, and includes all who have an interest
in the land. If they do not appear and oppose the registration
of their own estate or interest in the property in the name of
another, judgment is rendered against them by default, and, in
the absence of fraud, such judgment is conclusive. If an
interest in the land will not by itself operate to vacate a decree
of registration, a fortiori, fraud is not alone sufficient to do so.60
As further pointed out in the same book,61 the petition for
review must be filed within one year from entry of the decree
of registration. As written:
As long as a final decree has not been entered by the Land
Registration Authority and period of one year has not elapsed
from the date of entry of such decree, the title is not finally
adjudicated and the decision in the registration case continues
to be under the control and sound discretion of the registration
court.62 After the lapse of said period, the decree becomes
incontrovertible and no longer subject to reopening or review.
Section 32 provides that a petition for review of the decree
of registration may be filed "not later than one year from
and after the date of entry of such decree of
registration." Giving this provision a literal interpretation, it
may at first blush seem that the petition for review cannot be
presented until the final decree has been entered. However, it
has been ruled that the petition may be filed at any time
after the rendition of the court's decision and before the
expiration of one year from the entry of the final decree of
registration for, as noted in Rivera v. Moran,63 there can be
no possible reason requiring the complaining party to wait until
the final decree is entered before urging his claim for fraud.
The one-year period stated in Sec. 32 within which a petition
to re-open and review the decree of registration refers to the
decree of registration described in Section 31, which decree is
prepared and issued by the Land Registration Administrator.64
The provision of Section 31 that every decree of registration
shall bind the land, quiet title thereto, and be conclusive upon
and against all persons, including the national government,
and Sec. 32 that the decree shall not be reopened or revised
by reason of absence, minority or other disability or by any
proceeding in court, save only in cases of actual fraud and
then only for one year from the entry of the decree, must be
understood as referring to final and unappealable decrees of
registration. A decision or, as it is sometimes called after entry,
a decree of a registration court, does not become final and
unappealable until fifteen days after the interested parties
have been notified of its entry, and during that period may be
set aside by the trial judge on motion for new trial, upon any of
the grounds stated in the Rules of Court.65 An appeal from the
decision of the trial court prevents the judgment from
becoming final until that decree is affirmed by the judgment of
the appellate court.66
A petition for review under Section 32 is a remedy
separate and distinct from a motion for new trial and the
right to the remedy is not affected by the denial of such a
motion irrespective of the grounds upon which it may
have been presented. Thus, where petitioners acquired their
interest in the land before any final decree had been entered,
the litigation was therefore in effect still pending and, in these
circumstances, they can hardly be considered innocent
purchasers in good faith.671avvphi1
Where the petition for review of a decree of registration is filed
within the one-year period from entry of the decree, it is error
for the court to deny the petition without hearing the evidence
in support of the allegation of actual and extrinsic fraud upon
which the petition is predicated. The petitioner should be
afforded an opportunity to prove such allegation.68
In the present case, the one-year period before the Torrens
title becomes indefeasible and incontrovertible has not yet
expired; thus, a review of the decree of registration would have
been the appropriate remedy.
Based on the above disquisitions, the other issues raised by
the petitioner are necessarily rendered inconsequential.
WHEREFORE, the petition for review on certiorari of petitioner
Eland Philippines, Inc. is hereby GRANTED, and the decision
dated February 28, 2006 of the Court of Appeals (CA) in CA-
G.R. CV No. 67417, which dismissed the appeal of petitioner
Eland Philippines, Inc. and affirmed the resolutions dated
November 3, 1999 and June 28, 2006 of Branch 18, RTC of
Tagaytay City, is hereby REVERSED and SET ASIDE.
Consequently, the resolutions dated November 3, 1999 and
June 28, 2006 of Branch 18, RTC of Tagaytay City in Civil
Case No. TG-1784 are hereby declared NULL and VOID.
SO ORDERED.
G.R. No. 219500, August 09, 2017
MAMERTO DY, Petitioner, v. MARIA LOURDES ROSELL
ALDEA, Respondent.
DECISION
MENDOZA, J.:
This is a petition for review on certiorari seeking to reverse and
set aside the January 30, 2015 Decision1and July 1, 2015
Resolution2 of the Court of Appeals (CA) in CA-G.R. CV No.
03974, which nullified the November 18, 2009 Decision3 of the
Regional Trial Court, Branch 23, Cebu City (RTC) in Civil Case
No. CEB-31689.
The Antecedents
Petitioner Mamerto Dy (Mamerto) is the owner of Lot 5158
located in Vito, Minglanilla, Cebu, with an area of 6,738 square
meters, and covered by Transfer Certificate of Title (TCT) No.
T-24849.
In June 2005, Mamerto agreed to sell the subject land to his
brothers Nelson Dy (Nelson) and Sancho Dy, Jr. (Sancho). He
asked them to secure copies of the tax declarations covering
the subject land from the Municipal Assessor's Office. Nelson
found out that the subject land had gone through a series of
anomalous transactions. The owner's duplicate copy of TCT
No.T-24849 was declared lost. As a result, a new owner's
duplicate copy of the same TCT was issued and the subject
land was subsequently mortgaged.
On August 17, 2005, Mamerto, through his lawyer, sent a
letter to the Register of Deeds of Cebu informing the said
office that his owner's duplicate copy of TCT No. T-24849 was
never lost and that he never mortgaged his property to
anyone.4
When Mamerto discovered that the subject land was being
fenced upon the instruction of respondent Maria Lourdes
Rosell Aldea (Lourdes), he immediately filed a complaint
against the latter before the barangay office of Minglanilla.
Lourdes, however, failed to attend the hearing. A certificate to
file action was subsequently issued.
On September 16, 2005, Atty. Manolo D. Rubi, Deputy
Register of Deeds, informed Nelson that TCT No. T-134753
covering the subject land was issued in Lourdes'
name.5 Mamerto insisted that he never executed any deed of
sale in favor of Lourdes and that the signature appearing on
the purported deed of sale was not his authentic signature.6
For her part, Lourdes countered that in 2004, a certain Mila
Labang (Mila) was introduced to her by her aunt Luz
Aldea (Luz). Mila told her that several parcels of land in
Minglanilla, including the subject land, were purportedly for
sale.7
After she visited the lots in Minglanilla, Lourdes signified her
intention to buy the subject land. Mila informed Lourdes that
the subject land was mortgaged to a certain Atty. Lim and
further told her that she should pay the loan secured by the
mortgage. Thereafter, Mila introduced her to Fatima
Nadela (Fatima), who allegedly knew the owner of the subject
land and promised Lourdes that she would prepare the deed
of sale.8

On June 20, 2004, Lourdes met with the person impersonating
Mamerto (the impostor) at a hotel in Cebu City. She gave the
impostor P1,010,700.00 as payment for the 3,369 square
meter-portion of the subject land. Thereafter, they signed the
Deed of Sale9 in the presence of Mila, Fatima and Zenon
Aldea (Zenon), Lourdes' uncle. Afterwards, Lourdes, Fatima
and the impostor went to the office of Atty. Lim to pay the
mortgage loan.10
A few weeks thereafter, the impostor called Lourdes and
insisted that she should buy the entire land for it would be
difficult and expensive to subdivide the same. Lourdes agreed
and paid an additional P673,800.00. Lourdes and the impostor
signed a second deed of sale. For the 6,738 square meter-
property, Lourdes paid an aggregate sum of P1,684,500.00.11
After weeks of waiting, Lourdes was informed by Fatima that
the impostor was dead and he had not given any money to
process the transfer of the subject land. Lourdes went to the
Office of the Provincial Assessor to process the payment of
capital gains tax and the transfer of title in her name.
Eventually, the Register of Deeds issued TCT No. T-134753
under her name.12 Consequently, Mamerto filed a complaint
for declaration of nullity of deed of sale and TCT No. T-
134753, and recovery of real property with injunction and
damages.
The RTC Ruling
In its November 18, 2009 Decision, the RTC ruled that
Mamerto had a better right over the subject land and was the
rightful and lawful owner thereof. It found that Mamerto's
owner's duplicate copy was never lost, and so ruled that the
reconstituted title issued in favor of the impostor was null and
void. Hence, the RTC nullified Lourdes' title as it was based on
a void reconstituted title. It further opined that the contract of
sale between Lourdes and the impostor was null and void
because the latter did not have the right to transfer ownership
of the subject land at the time it was delivered to Lourdes.
The trial court held that Lourdes could not be considered a
buyer in good faith because she should have been suspicious
of the transaction which occurred at a hotel room and without
any lawyer present. It noted that Lourdes gave her money to
the seller even if the owner's copy of the certificate of title was
not handed to her; and that she decided to buy the remaining
portion of the subject land when the price was reduced to
P200.00 per square meter for the flimsy reason that it would
be hard for the seller to subdivide the subject land.
Unconvinced, Lourdes elevated an appeal to the CA.
The CA Ruling
In its assailed January 30, 2015 Decision, the CA reversed
and set aside the RTC ruling. It declared that Lourdes was an
innocent purchaser for value. The appellate court ruled that a
person dealing with registered land is only charged with notice
of the burdens on the property which are noted on the face of
the register or the certificate of title. It observed that the only
annotation at the back of the title was that it was mortgaged to
Audie C. Uy (Uy).
The CA added that Lourdes exercised ordinary prudence
because during the signing of the deed of sale, she asked for
an identification card and she was given a senior citizen's I.D.,
showing that the person she was dealing with was "Mamerto
Dy." It stated that while it turned out that the I.D. exhibited by
the seller was fake and that the person claiming to be the
owner of the land was a fraud, Lourdes could not be blamed
for believing that she was dealing with the real owner of the
land. The appellate court held that the confirmation of Fatima;
Engracia Mondrel and Rena Canio, the overseers of the
subject land; and Uy, the named mortgagee lead Lourdes to
believe that she was dealing with the rightful owner.
Aggrieved, Mamerto moved for reconsideration, but his motion
was denied by the CA in its July 1, 2015 Resolution.
Hence, this petition.
ISSUES
(1)
WHETHER THE RECONSTITUTED TITLE, FROM WHICH
TCT NO. T-134753 IN THE NAME OF LOURDES WAS
DERIVED, IS VALID.
(2)
WHETHER LOURDES IS AN INNOCENT PURCHASER FOR
VALUE WHO IS ENTITLED TO THE APPLICATION OF THE
MIRROR DOCTRINE.
(3)
WHETHER MAMERTO HAS BETTER RIGHT OVER THE
SUBJECT LAND.
Mamerto argues that the fact that the title was reconstituted
should have urged Lourdes to conduct further investigation on
the identity of the vendor; that even though Fatima, Uy and the
purported overseers assured Lourdes that the person she was
dealing with was the real owner of the subject land, she should
have taken into consideration that these persons might have
been lying and that a possible syndicated sale might have
been planned; that the impostor did not accompany her when
she visited the subject land; that she should have asked for
other documents to establish the identity of the seller; and that
the market value of the subject land ranges from P800.00 to
P1,000.00, thus, Lourdes should have wondered why the
purchase price was inexpensive.
In her Comment,13 dated December 18, 2015, Lourdes
contends that she is an innocent purchaser for value; that
while it may be true that an impostor had fraudulently acquired
a void reconstituted title over the subject land, such
circumstance did not necessarily invalidate her own title; that a
valid transfer could issue from a void reconstituted title if an
innocent purchaser for value intervenes; and that where
innocent third persons rely on the correctness of the certificate
of title issued and acquire rights over the property, courts
cannot disregard such right and order the total cancellation of
the certificate of title for that would impair public confidence in
the certificate of title.
In his Reply,14 dated April 8, 2016, Mamerto insists that
Lourdes' argument that a spurious deed can become the root
of a valid title when an innocent purchaser for value comes
into the picture is not applicable where the real owner still
holds a valid and existing certificate of title; and that Lourdes
has met the impostor, thus, she should have inquired further
into the details of why the title was reconstituted.
The Court's Ruling

The petition is meritorious.
When the Owner's Duplicate
Certificate of Title has not been
lost, the reconstituted
certificate is void
The governing law for judicial reconstitution of title is Republic
Act (R.A.) No. 26, Section 15 of which provides when
reconstitution of a title should be allowed:
Section 15. If the court, after hearing, finds that the documents
presented, as supported by parole evidence or otherwise, are
sufficient and proper to warrant the reconstitution of the lost or
destroyed certificate of title, and that petitioner is the
registered owner of the property or has an interest
therein, that the said certificate of title was in force at the
time it was lost or destroyed, and that the description,
area and boundaries of the property are substantially the
same as those contained in the lost or destroyed
certificate of title, an order of reconstitution shall be issued.
The clerk of court shall forward to the register of deeds a
certified copy of said order and all the documents which,
pursuant to said order, are to be used as the basis of the
reconstitution. If the court finds that there is no sufficient
evidence or basis to justify the reconstitution, the petition shall
be dismissed, but such dismissal shall not preclude the right of
the party or parties entitled thereto to file an application for
confirmation of his or their title under the provisions of the
Land Registration Act. [Emphases supplied]
From the foregoing, it appears that the following requisites
must be complied with for an order for reconstitution to be
issued: (a) that the certificate of title had been lost or
destroyed; (b) that the documents presented by petitioner are
sufficient and proper to warrant reconstitution of the lost or
destroyed certificate of title; (c) that the petitioner is the
registered owner of the property or had an interest therein; (d)
that the certificate of title was in force at the time it was lost
and destroyed; and (e) that the description, area and
boundaries of the property are substantially the same as those
contained in the lost or destroyed certificate of title. Verily, the
reconstitution of a certificate of title denotes restoration in the
original form and condition of a lost or destroyed instrument
attesting the title of a person to a piece of land. The purpose of
the reconstitution of title is to have, after observing the
procedures prescribed by law, the title reproduced in exactly
the same way it has been when the loss or destruction
occurred.15
Indubitably, the fact of loss or destruction of the owner's
duplicate certificate of title is crucial in clothing the RTC with
jurisdiction over the judicial reconstitution proceedings.
In Spouses Paulino v. CA,16 the Court reiterated the rule that
when the owner's duplicate certificate of title was not actually
lost or destroyed, but is in fact in the possession of another
person, the reconstituted title is void because the court that
rendered the order of reconstitution had no jurisdiction over
the subject matter of the case, viz.:
As early as the case of Strait Times, Inc. v. CA, the Court has
held that when the owner's duplicate certificate of title has
not been lost, but is, in fact, in the possession of another
person, then the reconstituted certificate is void, because
the court that rendered the decision had no
jurisdiction. Reconstitution can be validly made only in case
of loss of the original certificate. This rule was reiterated in the
cases of Villamayor v. Arante, Rexlon Realty Group, Inc. v.
[CA], Eastworld Motor Industries Corporation v. Skunac
Corporation, Rodriguez v. Lim, Villanueva v.
Viloria, and Camitan v. Fidelity Investment Corporation. Thus,
with evidence that the original copy of the TCT was not lost
during the conflagration that hit the Quezon City Hall and that
the owner's duplicate copy of the title was actually in the
possession of another, the RTC decision was null and void for
lack of jurisdiction.
xxx xxx xxx
In reconstitution proceedings, the Court has repeatedly
ruled that before jurisdiction over the case can be validly
acquired, it is a condition sine qua non that the certificate
of title has not been issued to another person. If a
certificate of title has not been lost but is in fact in the
possession of another person, the reconstituted title is
void and the court rendering the decision has not
acquired jurisdiction over the petition for issuance of new
title. The courts simply have no jurisdiction over petitions by
(such) third parties for reconstitution of allegedly lost or
destroyed titles over lands that are already covered by duly
issued subsisting titles in the names of their duly registered
owners. The existence of a prior title ipso facto nullifies
the reconstitution proceedings. The proper recourse is to
assail directly in a proceeding before the regional trial court the
validity of the Torrens title already issued to the other
person.17 [Emphases supplied and citations omitted]
In this case, Mamerto asserted that he never lost his owner's
duplicate copy of TCT No. T-24829 and that he had always
been in possession thereof. Moreover, it is beyond doubt that
another person impersonated Mamerto and represented
before the court that the owner's duplicate copy of TCT No. T-
24829 was lost in order to secure a new copy which was
consequently used to deceive Lourdes into purchasing the
subject land. Hence, the fact of loss or destruction of the
owner's duplicate certificate of title, which is the primordial
element in the validity of reconstitution proceedings, is clearly
missing. Accordingly, the RTC never acquired jurisdiction over
the reconstitution proceedings initiated by the impostor, and its
judgment rendered thereafter is null and void. This alone is
sufficient to declare the reconstituted title null and void.
Only an innocent purchaser for
value may invoke the mirror
doctrine
The real purpose of the Torrens system of registration is to
quiet title to land and to put a stop to any question of legality of
the title except claims which have been recorded in the
certificate of title at the time of registration or which may arise
subsequent thereto.18 As a consequence, the mirror doctrine
provides that every person dealing with registered land may
safely rely on the correctness of the certificate of title issued
therefor and is in no way obliged to go beyond the certificate to
determine the condition of the property.19
Every registered owner and every subsequent purchaser for
value in good faith holds the title to the property free from all
encumbrances except those noted in the certificate.20 As such,
a defective title, or one the procurement of which is tainted
with fraud and misrepresentation — may be the source of a
completely legal and valid title, provided that the buyer is an
innocent third person who, in good faith, relied on the
correctness of the certificate of title, or an innocent purchaser
for value.21
Thus, in order to resolve whether Lourdes holds an
indefeasible title to the subject land, it becomes necessary to
determine whether she is an innocent purchaser for value.
Lourdes cannot be considered a parameters or lot area, the type of ownership, and the capacity
purchaser in good faith
In Nobleza v. Nuega,22 the Court defined an innocent
purchaser for value, to wit:
An innocent purchaser for value is one who buys the property
of another, without notice that some other person has a right
or interest in the property, for which a full and fair price is paid
by the buyer at the time of the purchase or before receipt of
any notice of claims or interest of some other person in the
property. It is the party who claims to be an innocent
purchaser for value who has the burden of proving such
assertion, and it is not enough to invoke the ordinary
presumption of good faith. To successfully invoke and be
considered as a buyer in good faith, the presumption is that
first and foremost, the "buyer in good faith" must have
shown prudence and due diligence in the exercise of
his/her rights. It presupposes that the buyer did everything
that an ordinary person would do for the protection and
defense of his/her rights and interests against prejudicial or
injurious concerns when placed in such a situation. The
prudence required of a buyer in good faith is not that of a
person with training in law, but rather that of an average
man who 'weighs facts and circumstances without
resorting to the calibration of our technical rules of
evidence of which his knowledge is nil.' A buyer in good
faith does his homework and verifies that the particulars are in
order — such as the title, the parties, the mode of transfer and
the provisions in the deed/contract of sale, to name a few. To
be more specific, such prudence can be shown by making an
ocular inspection of the property, checking the title/ownership
with the proper Register of Deeds alongside the payment of
taxes therefor, or inquiring into the minutiae such as the
of the seller to dispose of the property, which capacity
necessarily includes an inquiry into the civil status of the seller
to ensure that if married, marital consent is secured when
necessary. In fine, for a purchaser of a property in the
possession of another to be in good faith, he must exercise
due diligence, conduct an investigation, and weigh the
surrounding facts and circumstances like what any prudent
man in a similar situation would do.23 [Emphases supplied and
citations omitted]
In the case at bench, Lourdes was deficient in her vigilance as
buyer of the subject land.
During cross-examination, Lourdes admitted that she did not
conduct a thorough investigation and that she merely
instructed her uncle to check with the Register of Deeds
whether the subject land is free from any
24
encumbrance. Further, it must be noted that Lourdes met the
seller only during the signing of the two deeds of sale.25 Yet,
she did not call into question why the seller refused to see her
during the negotiation. For sure, an ordinary prudent buyer of
real property who would be relinquishing a significant amount
of money would want to meet the seller of the property and
would exhaust all means to ensure that the seller is the real
owner thereof.
Indeed, Lourdes conducted an ocular inspection of the subject
land. When she asked Engracia Mondrel, the overseer, if she
knows the owner, Engracia affirmed that the property is owned
by a person named "Mamerto Dy." Noteworthy, however, is
Lourdes' admission that the seller was not present when she
talked to Engracia such that there was no way for the latter to
ascertain whether she and Lourdes were talking about the
same Mamerto Dy.26
Another circumstance indicating that Lourdes was not an
innocent purchaser for value was the gross undervaluation of
the property in the deeds of sale at the measly price of
P1,684,500.00 when the true market value was at least
P5,390,400.00 for the entire property. Moreover, Lourdes
initially decided to buy only half of the subject land or 3,369
square meters. When the impostor, however, insisted that she
should buy the remaining half just because it would be difficult
to divide the subject land, Lourdes readily acceded without
questioning why the seller was willing to sell at P200.00 per
square meter.27
Certainly, it was not enough for Lourdes to show that the
property was unfenced and vacant; otherwise, it would be too
easy for any registered owner to lose his property, including its
possession, through illegal occupation.28 It was also imprudent
for her to simply rely on the face of the imposter's TCT
considering that she was aware that the said TCT was derived
from a duplicate owner's copy reissued by virtue of the alleged
loss of the original duplicate owner's copy.29 That
circumstance should have already alerted her to the need to
inquire beyond the face of the impostor's TCT.30
In sum, the Court rules that Lourdes is not an innocent
purchaser for value.
Mamerto may recover the
subject land notwithstanding its
registration in Lourdes' name
While it is true that under Section 32 of Presidential Decree
No. 1529 the decree of registration becomes incontrovertible
after a year, it does not altogether deprive an aggrieved party
of a remedy in law. The acceptability of the Torrens System
would be impaired, if it is utilized to perpetuate fraud against
the real owners.31
Furthermore, ownership is not the same as a certificate of title.
Registering a piece of land under the Torrens System does not
create or vest title, because registration is not a mode of
acquiring ownership.32 A certificate of title is merely an
evidence of ownership or title over the particular property
described therein.33 The indefeasibility of the Torrens title
should not be used as a means to perpetrate fraud against the
rightful owner of real property. Good faith must concur with
registration, otherwise, registration would be an exercise in
futility. A Torrens title does not furnish a shield for fraud,
notwithstanding the long-standing rule that registration is a
constructive notice of title binding upon the whole world. The
legal principle is that if the registration of the land is fraudulent,
the person in whose name the land is registered holds it as a
mere trustee.34
Hence, the fact that Lourdes was able to secure a title in her
name neither operates to vest ownership upon her of the
subject land nor cures the void sale. Accordingly, the Court
deems it proper to restore Mamerto's rights of dominion over
Lot 5158.
WHEREFORE, the January 30, 2015 Decision and July 1,
2015 Resolution of the Court of Appeals in CA-G.R. CV No.
03974 are REVERSED and SET ASIDE. The November 18,
2009 Decision of the Regional Trial Court, Branch 23, Cebu
City in Civil Case No. CEB-31689 is hereby REINSTATED.
SO ORDERED.
G.R. No. L-38387 January 29, 1990
HILDA WALSTROM, petitioner-appellant,
vs.
FERNANDO MAPA, JR., VICTORINO A. MAPA, MARIA C.M.
DE GOCO, FERNANDO MAPA, III, MARIO L. MAPA, and
THE REGISTER OF DEEDS OF THE PROVINCE OF
BENGUET, respondents-appellees.
Pelaez, Adriano & Gregrio for petitioner-appellant.
Tomas G. Mapa & Associates for private respondents.
SARMIENTO, J.:
This is a review of the Order dated December 1, 1973 of the
then Court of First Instance of Baguio-Benguet, Branch IV,
which dismissed, before trial on the merits, the petitioner's
complaint in Civil Case No. 2434. The concluding portion of
the assailed order states:
This Court is unprepared to consider this case as
falling under any of the exceptions to the rule on
exhaustion of administrative remedies because under
plaintiffs allegations, her "Petition for Relief " is still
pending resolution by the Secretary of Agriculture and
Natural Resources who may reconsider his action on
the matter in dispute; and, furthermore, an action for
annulment of title issued pursuant to a patent must be
initiated by the Director of Lands or at least by his prior
authority and consent (Kabayan (sic) 1 vs. Republic, L-
33307, August 30, 1973) who may be directed by the
Secretary for that purpose if plaintiff's "Petition for
Relief" is granted and the previous action reconsidered.
The records fail to show that such authority or consent
has been secured by the plaintiff before instituting the
present action.
A motion to dismiss of this nature does not affect the
jurisdiction of the court but shows that plaintiff lacks a
cause of action. (Commissioner of Immigration vs.
Vamenta, Jr., 45 SCRA 342.) In other words, non-
compliance with this requirement justifies the dismissal
for lack of cause of action. (Cruz vs. Del Rosario, 9
SCRA 755.)
WHEREFORE, the Court, finding the motion to dismiss
to be in order, hereby orders the dismissal of the case
without pronouncement as to costs.
SO ORDERED. 2
This drawn-out controversy between the parties, which is one
of the many cases we inherited from the pre-EDSA Court,
arose from the following facts and proceedings:
I.
(1) The petitioner alleges that long before World War II,
Cacao Dianson, predecessor-in-interest of Gabriela
Walstrom, filed a Free Patent Application (FPA) for a
parcel of land located between what are known as Lots
Nos. 1 and 2 of Psu-153657. Under the said Free
Patent Application, Cacao Dianson was able to secure
on April 10, 1933 the issuance of Free Patent No.
14885 and Original Certificate of Title No. 1217 in his
name.
(2) On June 9, 1933, Josefa Abaya Mapa,
predecessor- in-interest of the private respondents,
filed Miscellaneous Sales Application No. 6439 for a
parcel of land located in barrio Pico, municipality of La
Trinidad, Mountain Province.
(3) According to the petitioner, a public auction of the
land subject of Josefa Abaya Mapa's miscellaneous
sales application was held on April 18, 1934. Josefa
Abaya Mapa was the only bidder.
(4) On May 12, 1934, the Director of Lands awarded
Josefa Abaya Mapa a tract of land with an area of
2,800 square meters which was appraised at P0.05 per
square meter, located in Pico, La Trinidad, Mountain
Province, with the following boundaries: N.- Public
Land; S.E. - Public Land; S. - Road; W. - Public Land
(not surveyed) No improvements had been made on
the land.
(5) On June l, 1956, Cacao Dianson filed Free Patent
Application No. 3-74 covering Lots Nos. 1, 2, and 3 of
Psu-153657, situated in Barrio Beckel, La Trinidad,
Mountain Province, and on the same date he filed with
the District Land Office in Baguio City a letter protesting
the construction in April, 1956 by Josefa Abaya Mapa
of a camarin on the parcel of land (described as
"portion A") of one of the parcels of land more
specifically, Lot No. 1 of Psu-153657 — covered by
Dianson's FPA No. 3-74. 3
(6) The private respondents counter that this portion
being claimed by Dianson, which is designated as
Portion "A" of Lot 1, Psu-153657, was already awarded
to Josefa Abaya Mapa in the public bidding held in
1934.
(7) On June 17, 1958, the controversy between Cacao
Dianson and Josefa Abaya Mapa with respect to the
disputed property was referred to Bureau of Lands
Investigator Antonio Mejia for investigation. After
conducting several hearings and making an ocular
inspection of the controverted premises, Mejia
submitted his "Report of Investigation," wherein he
stated the following:
FINDINGS OF FACTS
Josefa Abaya Mapa has filed a Miscellaneous Sales
Application for a parcel of land located in Pico, La
Trinidad, Mt. Province, on June 9, 1933 and the same
was awarded to her on May 12, 1934. The land has an
area of 2800 square meters with the following
boundaries. North — Public Land, South-East — Public
Land, South-Road and West — Public Land.
The purchase price has been paid in full in 1943 as per
Official Receipt No. B-1982778 dated November 8,
1943.
The land was first applied for by her husband,
Fernando Mapa, but it was later transferred to Josefa
Abaya Mapa.
Cacao Dianson filed a Free Patent Application for the
same parcel of land on June 1, 1956, alleging that the
said land was first occupied by his father, Dianson, in
1884. The land has been survey under Psu-153657 on
September 10, 1956.
Cacao Dianson is occupying the land and has fenced
it. Josefa Abaya Mapa has constructed a sort of a
shack near the land. Terraces were made by Cacao
Dianson in the premises. Cacao Dianson has also
constructed a shack inside the land.
No survey appears to have been conducted on the
land covered by the Miscellaneous Sales Application of
Josefa Abaya Mapa.
Rodrigo H. Romea conducted a survey on the land.
However, Mr. Romea made two surveys separately.
One on the land pointed to her by Josefa Abaya Mapa
and the other, on the land which according to his
findings and opinion would be the correct place of the
land covered by the application of Josefa Abaya Mapa.
Lands Investigator Mejia also found that:
During the ocular inspection of the land, it was found
out that Mrs. Josefa Abaya Mapa has constructed a
shack near the road. On the other hand, Cacao
Dianson has also constructed a hut in the premises of
the said land. In fact, Cacao Dianson was in a
threatening mood against the Mapas during the ocular
inspection. Of the alleged improvements introduced by
Mrs. Josefa Abaya Mapa, they were not seen by the
herein Investigator, except the shack constructed by
her. However, rice terraces were found in the premises
and other plants, but from the appearance of the said
improvements, it seems to be recently introduced.
This Investigator has searched all the records in the
Office of the Bureau of Lands, Baguio City, but no
available records could be found regarding the location
of the land applied for by Josefa Abaya Mapa. A
verification of the records, however. show that Cacao
Dianson has sold the land applied for by him to a
certain Agripino Farol, a resident of Davao. 4
(8) The regional land officer of Dagupan City, in a
decision dated August 12, 1964, resolved the
controversy between Cacao Dianson and Josefa
Abaya Mapa in this wise:
In view of the foregoing, the undersigned holds and so
decides that Free Patent Application No. 3-74 of Cacao
Dianson be, as hereby it is, amended so as to exclude
therefrom Portion "A" of Lot No. 1, Psu-153657, as
shown on the sketch drawn at the back hereof and
shall cover only portion "B" of Lot No. 1, Lots 2 and 3 of
Psu-153657, and the Miscellaneous Sales Application
No. 6439 (E -1341) of Josefa Abaya Mapa shall cover
the said portion "A" of Lot No. 1, Psu-153657 and
thereafter both applications shall continue to be given
due course. 5
(9) In the meantime, Cacao Dianson died on August 7,
1964. Nearly two years later, on July 8,1966, Gabriela
Walstrom filed a motion for reconsideration with the
Director of Lands of the decision dated August 12,
1964 of the regional land officer, claiming that she had
acquired the rights and interests of Cacao Dianson to
the subject parcel of land by virtue of a transfer of said
rights and interests. by Dianson to one Agripino Farol
who, in turn, transferred the same rights and interests
to Gabriela Walstrom.
(10) On September 9, 1966, the Director of Lands,
acting on the motion for reconsideration filed by
Gabriela Walstrom, issued an order setting aside the
decision of August 12, 1964 of the district land officer of
Dagupan City.
(11) On November 9, 1966, Josefa Abaya Mapa
appealed the order dated September 9, 1966 of the
Director of Lands to the Department of Agriculture and
Natural Resources (DANR).
This became DANR Case No. 3118.
II.
(1) On July 28, 1967, the DANR Secretary rendered a
decision, dismissing Josefa Abaya Mapa's appeal from
the order dated September 9, 1966 of the Director of
Lands.
(2) On September 21, 1967, the heirs of Josefa Abaya
Mapa, through their judicial administrator, Victorino
Mapa, filed a motion for reconsideration of the decision
of the DANR promulgated on July 28, 1967.
(3) On June 13, 1968, the DANR Secretary Set aside
the order of the Director of Lands dated September 9,
1966 and ordered that the decision of the regional land
officer in Dagupan City dated August 12, 1964 be
reinstated and given full force and effect.
(4) On July 30, 1968, counsel of Gabriela Walstrom
manifested his intention to file a motion for
reconsideration against the DANR order, dated June
13, 1968, but it was only on September 20, 1968 that a
memorandum in support of his motion for
reconsideration was filed.
(5) On March 4, 1969, DANR Secretary Fernando
Lopez promulgated an order denying the motion for
reconsideration of Gabriela Walstrom on two (2)
grounds, as follows:
 1. From the foregoing, it is clear that more than
thirty days had elapsed from the time plaintiff
received the order she is seeking to be
reconsidered to the time she manifested any
intention to have the same reconsidered. Such
being the case, her motion does not merit any
consideration whatsoever for having been filed
out of tune.
2. Nevertheless, this office reviewed the records
of this case in view of the errors mentioned by
movant in her memorandum and the answer
thereto filed by defendant. This office, however
does not find any reversible error in its Order of
June 13, 1968.6
(6) Gabriela Walstrom filed a second motion for
reconsideration of the Order of the DANR dated June
13, 1968. In the meantime Mapa filed a motion for
execution of the said order of DANR.
(7) The DANR, in its order dated March 24, 1970,
denied the second motion for reconsideration of
Walstrom and granted the motion for execution filed by
the heirs of Josefa Abaya Mapa.
(8) On June 8, 1970, Gabriela Walstrom filed a petition
for relief with the DANR. Before her petition was heard,
she died on October 4, 1970. The heirs of Josefa
Abaya Mapa, pursuing the case, filed an answer dated
March 29, 1972, to the petition of Walstrom, stating
that:
Preliminary Statement
The land being controverted by Appellee Walstrom was
the subject of the Miscellaneous Sales Application and
not a Homestead Patent Application. The property now
being contested by Appellee Walstrom is already titled
in the name of the HEIRS OF JOSEFA ABAYA
MAPA, under original Certificate of Title No. P-456 of
the Registry of deeds for the Province of Benguet,
pursuant to a Miscellaneous Sales Patent No.
4487. This property, therefore, is now under the
Torrens System.
It is also worthwhile to note that the land in question is
only a small portion of the claim of Cacao Dianson and
Walstrom. This is the land in question particularly
designated as Portion "A" of Lot 1, Psu-153657. 7
(Emphasis supplied by petitioner Walstrom)
It was only upon receipt on April 11, 1972 of the above-stated
answer of the heirs of Josefa Abaya Mapa to the petition for
relief of the late Gabriela Walstrom, that the herein petitioner
Hilda Walstrom, daughter and successor-in-interest of the late
Gabriela, learned for the first time that the property being
contested by Walstrom was already titled in the name of the
heirs of Josefa Abaya Mapa, under Original Certificate of Title
No. P-456 of the Registry of Deeds for the Province of
Benguet, pursuant to Miscellaneous Sales Patent No. 4487.8
III.
Upon subsequent inquiry with respect to the claim of the heirs Hence, this petition.
of Josefa Abaya Mapa that the property in dispute in DANR
Case No. 3118 had already been titled pursuant to The petitioner submits two questions:
Miscellaneous Sales Patent No. 4487, the petitioner further
became aware, also for the first time, that Miscellaneous Sales I.
Patent No. 4487 was issued by the DANR Secretary on July
19,1971 and released for transmittal to the office of the DID PETITIONER-APPELLEE (sic) REALLY FAIL TO
Register of Deeds for Benguet Province on July 22, 1971; that EXHAUST ADMINISTRATIVE REMEDIES?
on September 30, 1971, respondent register of deeds issued
Original Certificate of Title No. P-456, pursuant to II.
Miscellaneous Sales Patent No. 4487; and that on or about
November 13, 1971, respondent Fernando Mapa, Jr.
IN THE LIGHT OF THE FACT THAT THE DISPUTED
transferred the property covered by Original Certificate of Title
MISCELLANEOUS SALES PATENT WAS ISSUED
No. P-456 to the other heirs of Josefa Abaya Mapa, namely,
ONJUNE 19, 1971, DOES THE FACT THAT THE
defendants Victorino A. Mapa, Jose A. Mapa, Maria C.M. de
PETITION FOR REVIEW IN DANR CASE NO. 3118
Goco, Fernando Mapa III, and Mario L. Mapa, in connection
HAD NOT YET BEEN RESOLVED AS OF JULY 19,
with which transfer, Transfer Certificate of Title No. T-6644
1972, PRECLUDE PETITIONER-APPELLANT FROM
was issued by the Register of Deeds of Benguet. 9
FILING ON SAID DATE (JULY 19,1972) HER SUIT TO
ANNUL SAID SALES PATENT AND THE TORRENS
During all this time, the petition for relief filed by Gabriela CERTIFICATES OF TITLE ISSUED BY THE
Walstrom on June 8, 1970 remained unresolved. In fact, the REGISTER OF DEEDS BY VIRTUE THEREOF? 10
DANR Secretary issued an order, dated January 9,1972,
giving due course to the said petition. According to petitioner
Petitioner Hilda Walstrom filed a civil complaint against the
Hilda Walstrom, she was compelled to file an action in the then
respondents praying for the nullification of the Mapas' sales
Court of First Instance of Baguio-Benguet on July 19, 1972
patent and certificates of title issued by the register of deeds of
because the one-year prescriptive period for seeking judicial
Benguet Province 11 under Section 38 of Act 496 or the Land
relief provided for in Sec. 38 of the Land Registration Act was
Registration Act.
about to lapse.
The pertinent portions of Section 38 of said Act are quoted as
The court a quo dismissed petitioner Hilda Walstrom's petition
follows:
on the ground of "failure to exhaust administrative remedy
dies."
SEC. 38. Decree of registration and remedies after
entry of decree.
 If the court after hearing finds that the applicant or
adverse claimant has title as stated in his application or
adverse claim and proper for registration, a decree of
confirmation and registration shall be entered. Every
decree of registration shall bind the land, and quiet title
thereto, subject only to the exceptions stated in the
following section. It shall be conclusive upon and
against all persons, including the Insular Government
and all the branches thereof, whether mentioned by
name in the application, notice of citation, or included in
the general description "To all whom it may concern,"
Such decree shall not be opened by reason of the
absence, infancy, or other disability of any person
affected thereby, nor by any proceeding in any court for
reversing judgments or decrees; subject, however, to
the right of any person deprived of land or of any estate
or interest therein by decree of registration obtained by
fraud to file in the competent Court of First Instance a
petition for review within one year after entry of the
decree provided no innocent purchaser for value has
acquired an interest....
It is the teaching of the foregoing provisions that a decree of
registration may be reopened or reviewed by the proper
Regional Trial Court upon the concurrence of five essential
requisites, to wit: (a) that the petitioner has a real and a
dominical right; (b) that he has been deprived thereof;(c)
through fraud; (d) that the petition is filed within one year from
the issuance of the decree; and (e) that the property has not
as yet been transferred to an innocent purchaser for value. 12
An examination of the records of the case shows non-
concurrence of the essential elements enumerated above.
The first element is patently not present because the petitioner
can not allege that she has already a real and dominical right
to the piece of property in controversy. The latest order of the
DANR Secretary, dated June 13,1968, was to give full force
and effect to the regional land officer's decision, dated August
12, 1964. 13 The regional land officer held that the petitioner's
Free Patent Application No. 3-74 shall exclude the disputed
portion "A" of Lot No. 1, which, instead, shall be included in the
Mapas' Miscellaneous Sales Application.
The second element is also absent since corollary to the
aforecited ruling of the DANR Secretary, the petitioner can not
aver that she was deprived of property because she did not
have a real right over portion "A".
Apropos the third element, the records are bereft of any
indication that there was fraud in the issuance of the
certificates of title. As matters stand, the prerequisites have
not been complied with. The petitioner's recourse to Section
38 would not have prospered; accordingly, the respondent
court's dismissal of petitioner's complaint was proper.
We also find that the lower court was correct in holding that
the case does not fall under any of the exceptions to the rule
on exhaustion of administrative remedies. The petitioner
herself admits that her petition for relief is still pending
resolution by the Secretary of Agriculture and Natural
Resources who may reconsider his action on the matter in
dispute. The petitioner's failure to exhaust administrative
remedies is a flaw which to our mind is fatal to a court review
at this time. 14
Instead of invoking Section 38, the petitioner should have We find no reversible error in the challenged order of the trial
pressed for the speedy resolution of her petition with the court.
DANR. The petitioner avers that since the one-year
prescriptive period for seeking judicial relief provided for in WHEREFORE, the petition is DENIED. No costs.
Sec. 38 of the Land Registration Act was about to lapse, she
was compelled to file the action to nullify said patent. 15 The SO ORDERED.
petitioner's submission is not correct. Her fear of the futility, or
even only inefficacy, of exhausting the administrative remedies Melencio-Herrera (Chairperson), Paras, Padilla and Regalado,
granted her by law is clearly unfounded. JJ., concur.

We have ruled before in Amerol vs. Bagumbaran 16 that G.R. No. L-30694 October 31, 1969
notwithstanding the irrevocability of the Torrens title already
issued in the name of another person, he can still be STERLING INVESTMENT CORPORATION, PACIFIC
compelled under the law to reconvey the subject property to EQUIPMENT CORPORATION, REGIONAL INVESTMENT
the rightful owner. The property registered is deemed to be CORPORATION and GOLDEN HILLS DEVELOPMENT
held in trust for the real owner by the person in whose name it CORPORATION, petitioners,
is registered. After all, the Torrens system was not designed to vs.
shield and protect one who had committed fraud or HONORABLE V. M. RUIZ, in his capacity as Judge of the
misrepresentation and thus holds title in bad faith. 17 Court of First Instance of Rizal, and ALEJANDRO
CABASBAS, respondents.
In an action for reconveyance, the decree of registration is
respected as incontrovertible.1âwphi1 What is sought instead V. E. del Rosario and Associates for petitioners.
is the transfer of the property, in this case the title thereof,
Ramon V. Sison for respondents.
which has been wrongfully or erroneously registered in
another person's name, to its rightful and legal owner, or to
FERNANDO, J.:
one with a better right. This is what reconveyance is all
about. 18
The assumption of jurisdiction by respondent Judge V. M. Ruiz
of the Court of First Instance of Rizal, Branch XV, of a suit in
Yet, the right to seek reconveyance based on an implied or
Civil Case No. 10603, filed in his sala by private respondent
constructive trust is not absolute nor is it imprescriptible. An
Alejandro Cabasbas, to annul a decision rendered by another
action for reconveyance based on an implied or constructive
branch of the same court of first instance notwithstanding his
trust must perforce prescribe in ten years from the issuance of
alleged lack of jurisdiction and his failure to dismiss the same
the Torrens title over the property.19
on the ground that such complaint did not state a cause of
action, the ground relied upon for the annulment of such
decision being intrinsic and not extrinsic fraud, with res
judicata moreover operating as a bar, prompted this petition
for certiorari, prohibition and mandamus.
The subject matter of the controversy is a parcel of land
originally owned by one Teodorico Cabasbas, who obtained a
homestead patent thereon on December 27, 1940. The
deceased was the father of respondent Alejandro Cabasbas.
Petitioners Sterling Investment Corporation, Pacific Equipment
Corporation, Regional Investment Corporation and Golden
Hills Development Corporation, defendants in Civil Case No.
10603, started by alleging that on February 18, 1958,
respondent Alejandro Cabasbas filed a complaint in Branch VI
of the Court of First Instance of Rizal (Civil Case No. 4870),
against the spouses Jose A. de Kastro and Estanislawa de
Kastro, spouses Lutgardo Reyes and Elisa A. Reyes, and
Demetrio de Jesus, to recover the land originally owned by the
late Teodorico Cabasbas, as evidenced by Original Certificate
of Title No. 815. On May 3, 1958, pursuant to a compromise
agreement entered into by the parties in the above-mentioned
Civil Case No. 4870, the Honorable Judge Andres Reyes of
Branch VI of the Court of First Instance of Rizal rendered a
decision in said case. By virtue of the above-mentioned
decision, the spouses Lutgardo Reyes and Elisa A. Reyes,
and Demetrio de Jesus were declared to be the registered
owners of the western portion of the land originally owned by
the late Teodorico Cabasbas as per Original Certificate of Title
No. 615, subject matter of the above-mentioned litigation.1
Petitioners then specifically made mention of how
subsequently they acquired ownership of the above-mentioned
property originally owned by the deceased Teodorico
Cabasbas, by virtue of the following transfers, namely: (a)
Elisa A. Reyes, sold a portion of the land to the spouses
Demetrio de Jesus and Florencia Borja and the remaining
portion to the spouses Jose Rojas and Emiliana Mendoza; (b)
subsequently, the spouses Jose Rojas and Emiliana Mendoza
acquired the whole lot by purchasing the portion belonging to
the spouses Demetrio de Jesus and Florencia Borja; (c) the
spouses Jose Rojas and Emiliana Mendoza thereafter sold
one-half of the land to Natividad Araneta and the other half to
the spouses Vincent Recto and Ofelia Martinez; (d) the
spouses Vincent Recto and Ofelia Martinez sold their one-half
interest to petitioner Regional Investment Corporation, while
Natividad Araneta sold her one-half share to Sterling
Investment Corporation; (e) finally, Sterling Investment
Corporation sold the portion belonging to it to Pacific
Equipment Corporation, which in turn sold it to Golden Hills
Development Corporation.2
Mention was then made that on October 24, 1968, respondent
Alejandro Cabasbas filed his second amended complaint, Civil
Case No. 10603, praying that the decision in the previous Civil
Case No. 4870, based on a compromise agreement, be
declared null and void with the allegation that it was obtained
through fraud as it was made to appear before the court of first
instance that the conveyance of title was made on February,
1946 when in fact it took place on September 14, 1944, in
violation of the Homestead Law.3
In the answer of petitioners as defendants, there was a
specific denial of the allegations that the previous
conveyances were made in bad faith or that they were null and
void. In addition, petitioners Sterling Investment Corporation
and Pacific Equipment Corporation alleged as affirmative and
special defenses that the sale to them made on June 1, 1967
and November 14, 1967 were in good faith and for valuable
consideration they being innocent purchasers for value thus
negating any cause of action against them.4 Petitioners filed a
motion to lift the notice of lis pendens, previously issued on
March 6, 1968, with the allegation that the suit was filed by
respondent Alejandro Cabasbas for harassment purposes
only. They likewise asserted in such motion that petitioner
Golden Hills Development Corporation had subdivided the
property and contracted to sell the portion thereof to over 100
buyers. They affirmed their readiness and willingness to post a
bond in favor of the plaintiff in that suit, Alejandro Cabasbas.5
In an order of January 14, 1969, respondent Judge Ruiz
denied such motion. Then came an omnibus motion for
reconsideration by petitioners as defendants stressing that
respondent Judge should dismiss the then pending suit on the
grounds of lack of jurisdiction, failure to state a cause of
action, bar by res judicata and the impropriety of the regulation
of the notice of lis pendens, the omnibus motion petition being
dated May 5, 1969.6
After an order denying such omnibus motion of June 24, 1969,
the present petition was filed on July 10 this year. In a
resolution of July 15, 1969, we gave due course to this petition
for certiorari, prohibition and mandamus, requiring
respondents to answer within ten days from notice. Likewise,
upon the posting of a bond of P10,000.00, we granted the writ
of preliminary injunction prayed for.
The three-page answer filed on July 29, 1969, admitted the
refusal of respondent Judge to dismiss Civil Case No. 10603
but alleged that he has jurisdiction, that the complaint states
sufficient cause of action and that the suit is not barred by the
doctrine of res judicata. There was likewise an admission of
the principal facts alleged in the petition coupled with the
assertion that the sale of a parcel of land was made on
September 14, 1944 in violation of the five-year period within
which a transfer of a homestead patent is prohibited.
The plea of petitioners must be granted. There is merit in the
petition.
1. The jurisdiction of respondent Judge is assailed on the
ground that only the same branch of the Court of first instance,
which rendered a decision, possesses the competence to
annul it. Since it is admitted that the 1958 decision was
rendered in the sala then presided by Judge Andres Reyes,
now Justice of the Court of Appeals, clearly respondent Judge
who presides in another and distinct branch is not vested with
jurisdiction over Civil Case No. 10603. This contention has
support in our decisions. Thus, in J. M. Tuason & Co. Inc. v.
Torres,7 cited in the petition, we explicitly held: "Petitioner's
submission that only Branch IV of the Court of First Instance of
Quezon City can annul its own decision is well taken. It is
settled that the jurisdiction to annul a judgment of a branch of
the Court of First Instance belongs solely to the very same
branch which rendered the judgment. Any other branch, even
if it be in the same judicial district — like those of the Courts of
First Instance of Rizal, sitting at Pasig and at Quezon City,
which belong to the 7th Judicial District — that attempts to do
so either exceeds its jurisdiction, as We held in Cabigao v. Del
Rosario, 44 Phil. 182, or acts with grave abuse of discretion
amounting to lack of jurisdiction, as We ruled in P.N.B. v.
Javellana, 92 Phil. 525. In either case, certiorari and
prohibition would be proper to prevent the attempting branch
of the court from proceeding to nullify a final decision rendered
by a co-equal and coordinate branch. The two cases cited
have only recently been reaffirmed by Us in Mas v. Dumara-
og, L-16252, Sept. 29, 1964." .
The success of the petition could thus be predicated on this
ground alone, although it must be admitted that at least two
members of the Court feel the need for a re-examination of the
above doctrine.
2. Insofar, however, as the petition is predicated on an
absence of a cause of action, the ground relied upon to annul
the 1958 decision based on a compromise agreement being
intrinsic and not extrinsic fraud, there is unanimity in the view
entertained by the Court that petitioners' stand must be
sustained.
It suffices to refer to the leading case of De Almeda v. Cruz,8 a
1949 decision. As Justice Tuason speaking for the Court made
clear: "Fraud to be ground for nullity of a judgment must be
extrinsic to the litigation. Were not this the rule there would be
no end to litigations, perjury being of such common occurrence
in trials. In fact, under the opposite rule, the losing party could
attack the judgment at any time by attributing imaginary
falsehood to his adversary's proofs. But the settled law is that
judicial determination however erroneous of matters brought
within the court's jurisdiction cannot be invalidated in another
proceeding. It is the business of a party to meet and repel his
opponent's perjured evidence."
As likewise aptly pointed out by him: "Under these
circumstances, the most careful scrutiny of the complaint
should be made to see that it contains concrete and explicit
charges and that its allegations have the ring of probability. To
write finis to litigations at the shortest possible time is a
cardinal policy in the administration of justice, and rules of
procedure have been adopted with this as one of their specific
ends in view. One who assails the judgment of the court
whose machinery he himself had set in motion places upon
himself greater burden than is required in ordinary cases, to
make in his complaint plausible showing that the court's and
the defendant's time, and expense will not again go to waste."
The De Almeda decision has been subsequently cited with
approval in at least five cases.9
The latest case in point, decided in 1968, this time in an
opinion penned by Justice Zaldivar, reiterates the above
doctrine.10 Thus: "Not every kind of fraud, however, is
sufficient ground to set aside a judgment. This Court has held
that only extrinsic or collateral, as distinguished from intrinsic,
fraud is a ground for annulling a judgment. Extrinsic fraud
refers to any fraudulent act of the successful party in a
litigation which is committed outside the trial of a case against
the defeated party, or his agents, attorneys or witnesses,
whereby said defeated party is prevented from presenting fully
and fairly his side of the case. On the other hand, intrinsic
fraud refers to acts of a party in a litigation during the trial,
such as the use of forged instruments on perjured testimony,
which did not affect the presentation of the case, but did
prevent a fair and just determination of the case."
3. In view of the above, there is no need to pass on the
question of res judicata, which for petitioners likewise
constitutes a bar to the assumption of jurisdiction of
respondent Judge.
WHEREFORE, the writ of certiorari prayed for is granted. The
order of respondent Judge of January 14, 1969 denying the
motion to lift the lis pendens and his order of June 24, 1969
denying the omnibus motion for reconsideration, which sought
the dismissal of Civil Case No. 10603 on the ground among
others of lack of jurisdiction as well as the failure to state a
cause of action, are declared null and set aside. Respondent
Judge is directed to order the cancellation of the notice of lis
pendens filed by respondent Cabasbas in such action, and
thereafter to dismiss Civil Case No. 10603. The writ of
prohibition is likewise granted, thereafter perpetually
restraining respondent Judge from further taking cognizance of
the aforesaid Civil Case No. 10603. The writ of preliminary
injunction is hereby made permanent. With costs against
respondent Alejandro Cabasbas.
Concepcion, C.J., Reyes, J.B.L., Dizon, Makalintal, Zaldivar,
Sanchez, Castro, Teehankee and Barredo, JJ., concur.
G.R. No. 182908 August 6, 2014
HEIRS OF FRANCISCO I. NARVASA, SR., and HEIRS OF
PETRA IMBORNAL and PEDRO FERRER, represented by
their Attorney-in-Fact, MRS. REMEDIOS B. NARVASA-
REGACHO, Petitioners,
vs.
EMILIANA, VICTORIANO, FELIPE, MA TEO, RAYMUNDO,
MARIA, and EDUARDO, all surnamed
IMBORNAL,Respondents.
DECISION
PERLAS-BERNABE, J.:
Assailed in this petition for review on certiorari1 are the
Decision2 dated November 28, 2006 and the Resolution3dated
May 7, 2008 of the Court of Appeals (CA) in CA-G.R. CV No.
57618 which reversed and set aside the Decision4 dated
August 20, 1996 of the Regional Trial Court of Dagupan City,
Branch 44 (RTC) in Civil Case No. D-6978, declared (a) the
descendants of Ciriaco Abrio5 as the exclusive owners of the
Motherland covered by Original Certificate of Title (OCT) No.
1462,6 (b) the descendants of respondent Victoriano Imbornal
(respondent Victoriano) as the exclusive owners of the first
accretion (First Accretion) covered by OCT No. P-318,7 and (c)
the descendants of Pablo Imbornal (Pablo) as the exclusive
owners of the second accretion (Second Accretion) covered by
OCT No. 21481,8 and dismissed the complaint and
counterclaim in all other respects for lack of merit.
The Facts
Basilia Imbornal+ (Basilia) had four (4) children, namely,
Alejandra, Balbina, Catalina, and Pablo.Francisco I. Narvasa,
Sr.9 (Francisco) and Pedro Ferrer (Pedro) were the
children10 of Alejandra, while petitioner Petra Imbornal (Petra)
was the daughter of Balbina.11 Petitionersare the heirs and
successors-in-interest of Francisco, Pedro, and Petra
(Francisco, et al.). On the other hand, respondentsEmiliana,
Victoriano, Felipe, Mateo, Raymundo, Maria, and Eduardo, all
surnamed Imbornal, are the descendants of Pablo.12
During her lifetime, Basilia owned a parcel of land situated at
Sabangan, Barangay Nibaliw West, San Fabian, Pangasinan
with an area of 4,144 square meters (sq. m.), more or less
(Sabangan property), which she conveyed to her three (3)
daughters Balbina, Alejandra, and Catalina (Imbornal sisters)
sometime in 1920.13
Meanwhile, Catalina’s husband, Ciriaco Abrio (Ciriaco),
applied for and was granted a homestead patent over a
31,367-sq. m. riparian land (Motherland) adjacent to the
Cayanga River in San Fabian, Pangasinan.14 He was
eventually awarded Homestead Patent No. 2499115 therefor,
and, on December 5, 1933, OCT No. 1462 was issued in his
name. Later, or on May 10, 1973, OCT No. 1462 was
cancelled, and Transfer Certificate of Title (TCT) No.
10149516 was issued in the name of Ciriaco’s heirs, namely:
Margarita Mejia; Rodrigo Abrio, marriedto Rosita Corpuz;
Antonio Abrio, married to Crisenta Corpuz; Remedios Abrio,
married to Leopoldo Corpuz; Pepito Abrio; Dominador Abrio;
Francisca Abrio; Violeta Abrio; and Perla Abrio (Heirs of
Ciriaco).
Ciriaco and his heirs had since occupied the northern portionof
the Motherland, while respondents occupied the southern
portion.17
Sometime in 1949, the First Accretion, approximately 59,772
sq. m. in area, adjoined the southern portion of the
Motherland. On August 15, 1952, OCT No. P-318 was issued
in thename of respondent Victoriano, married to Esperanza
Narvarte, covering the First Accretion.18 Decades later, or in
1971, the Second Accretion, which had an area of 32,307 sq.
m., more or less, abutted the First Accretion on its southern
portion.19 On November 10, 1978, OCT No. 21481 was issued
in the names of all the respondents covering the Second
Accretion.
Claiming rights over the entire Motherland, Francisco, et al., as
the children of Alejandra and Balbina, filed on February
27,1984 an Amended Complaint20 for reconveyance,
partition,and/or damages against respondents, docketed as
Civil Case No. D-6978. They anchored their claim on the
allegation that Ciriaco, with the help of his wifeCatalina, urged
Balbina and Alejandra to sell the Sabangan property, and that
Ciriaco used the proceeds therefrom to fund his then-pending
homestead patent application over the Motherland. In return,
Ciriaco agreed that once his homestead patent is approved,
he will be deemed to be holding the Motherland – which now
included both accretions – in trust for the Imbornal sisters.21
Likewise, Francisco, et al.alleged that through deceit, fraud,
falsehood, and misrepresentation, respondent Victoriano, with
respect to the First Accretion, and the respondents collectively,
with regard to the Second Accretion, had illegally registered
the said accretions in their names, notwithstanding the fact
that they werenot the riparian owners (as they did not own the
Motherland to which the accretions merely formed adjacent
to). In this relation, Francisco, et al. explained that they did not
assert their inheritance claims over the Motherland and the
two (2) accretions because they respected respondents’ rights,
until they discovered in 1983 that respondents have
repudiated their (Francisco, et al.’s) shares thereon.22 Thus,
bewailing that respondents have refused them their rights not
only with respect to the Motherland, but also to the subsequent
accretions, Francisco, et al. prayed for the reconveyance
ofsaid properties, or, in the alternative, the payment of their
value, as well as the award of moral damages in the amount of
₱100,000.00, actual damages in the amount of ₱150,000.00,
including attorney’s fees and other costs.23
24
In their Amended Answer dated March 5, 1984, respondents
contended that: (a) the Amended Complaint statedno cause of
action against them, having failed to clearly and precisely
describe the disputed properties and specify the
transgressions they have allegedly committed; (b) the action
was barred by prescription; and (c) that the properties sought
to be reconveyed and partitioned are not the properties of their
predecessors-ininterest but, instead, are covered by Torrens
certificates of titles, free from any encumbrance, and declared
for taxation purposes in their names. In this regard,
respondents prayed that the Amended Complaint be
dismissed and that Francisco, et al.be held liable for the
payment of moral damages, attorney’s fees, and costs of suit
in their favor.
During trial, it was established from the testimonies of the
parties that the Motherland was eventually sold bythe Heirs of
Ciriaco to a certain Gregorio de Vera (de Vera), and thatsaid
heirs and deVera were not impleaded as parties in this case.25
The RTC Ruling
On August 20, 1996, the RTC rendered a Decision26 in favor of
Francisco, et al. and thereby directed respondents to: (a)
reconvey to Francisco, et al. their respective portions in the
Motherland and in the accretions thereon, or their pecuniary
equivalent; and (b) pay actual damages in the amount of
₱100,000.00, moral damages in the amount of ₱100,000.00,
and attorney’s fees in the sum of ₱10,000.00, as well as costs
of suit.
The RTC found that the factual circumstances surrounding the
present case showed that an implied trust existed between
Ciriaco and the Imbornal sisters with respect to the
Motherland.27 It gave probative weight to Francisco, et al.’s
allegation that the Sabangan property, inherited by the
Imbornal sisters from their mother, Basilia, was sold in order to
help Ciriaco raise funds for his then-pending homesteadpatent
application. In exchange therefor, Ciriaco agreed that he shall
hold the Motherland in trust for them once his homestead
patent application had been approved. As Ciriaco was only
able to acquire the Motherland subject of the homestead
patent through the proceeds realized from the sale of the
Sabangan property, the Imbornal sisters and, consequently,
Francisco, et al. (as the children of Alejandra and Balbina) are
entitled to their proportionate shares over the Motherland,
notwithstanding the undisputed possession of respondents
over its southern portion since 1926.28
With respect to the accretions thatformed adjacent to the
Motherland, the RTC ruled that the owner of the Motherland is
likewise the owner of the said accretions. Considering that the
Imbornal sisters have become proportionate owners of the
Motherland by virtue of the implied trust created between them
and Ciriaco, they (Imbornal sisters) and their heirs are also
entitled to the ownership of said accretions despite the fact
that respondents were able to register them in their names.
Dissatisfied with the RTC’s ruling, respondents elevated the
matter on appeal to the CA.
The CA Ruling
On November 28, 2006, the CA rendered a subject to acquisitive prescription by third persons, any
Decision29 reversing and setting aside the RTC Decision and
entering a new one declaring: (a) the descendants of Ciriaco
as the exclusive owners of the Motherland; (b) the
descendants of respondent Victoriano asthe exclusive owners
of the First Accretion; and (c) the descendants of Pablo (i.e.,
respondents collectively) as the exclusive owners of the
Second Accretion.
With respect to the Motherland, the CA found that Ciriaco
alone was awarded a homestead patent, which later became
the basis for the issuance of a Torrens certificate of title in his
name; as such, saidcertificate of title cannot be attacked
collaterally through an action for reconveyance filed by his
wife’s (Catalina’s) relatives (i.e., Francisco, et al.being the
children of Alejandra and Balbina, who, in turn, are the sisters
of Catalina). The CA further observed that the homestead
patent was not aninheritance of Catalina; instead, it was
awarded by the government to Ciriaco after having fully
satisfied the stringent requirements set forth under
Commonwealth Act No. 141,30 as amended,31and his title
thereto had already become indefeasible.32 Consequently,
since the entire Motherland was titled in Ciriaco’s name, his
descendants should be regarded as the absolute owners
thereof.
On the other hand, with regard to the disputed accretions, the
CA ruled that respondents – i.e., respondent Victoriano with
respect to the First Accretion, and all the respondents
withrespect to the Second Accretion – need not be the owners
of the Motherland in order to acquire them by acquisitive
prescription. Considering that accretions are not automatically
registered in the name of the riparianowner and are, therefore,
occupant may apply for their registration. In this case, the CA
found that respondents have acquired title to the subject
accretions by prescription,33 considering that they have been in
continuous possession and enjoyment of the First Accretion in
the concept of an owner since 1949 (when the First Accretion
was formed), which resulted in the issuance of a certificate of
title in the name of respondent Victoriano covering the same.
Accordingly, they have also become the riparian owners of the
Second Accretion, and given thatthey have caused the
issuance of OCT No. 21481 in their names over the said
Accretion, they have also become the absolute ownersthereof.
Since Francisco, et al. took no action to protect their purported
interests over the disputed accretions, the respondents’ titles
over the same had already become indefeasible, to the
exclusion of Francisco, et al.34
At odds with the CA’s disposition, Francisco et al. filed a
motion for reconsideration which was, however,denied by the
CA in a Resolution35 dated May 7, 2008, hence, this petition
taken by the latter’s heirs as their successors-in-interest.
The Issue Before the Court
The issue to be resolved by the Court is whether or not the CA
erred in declaring that: (a) the descendants of Ciriaco are the
exclusive owners of the Motherland; (b) the descendants of
respondent Victoriano are the exclusive owners of the First
Accretion; and (c) the descendants of Pablo (respondents
collectively) are the exclusive owners of the Second Accretion
on the basis of the following grounds: (a) prescription of the
reconveyance action, which was duly raised as anaffirmative
defense in the Amended Answer, and (b) the existence of an
implied trust between the Imbornal sisters and Ciriaco.
The Court’s Ruling
The petition is bereft of merit.
A. Procedural Matter: Issue of Prescription.
At the outset, the Court finds that the causes of action
pertaining to the Motherland and the First Accretion are barred
by prescription.
An action for reconveyance is one that seeks to transfer
property, wrongfully registered by another, to its rightful and
legal owner.36 Thus, reconveyance is a remedy granted only
tothe owner of the property alleged to be erroneously titled in
another’s name.37
As the records would show, the Amended Complaint filed by
petitioners’ predecessors-in-interest, Francisco, et al. is for the
reconveyance of their purported shares or portions in the
following properties: (a) the Motherland, originally covered by
OCT No. 1462 in the name of Ciriaco; (b) the First Accretion,
originally covered by OCT No. P-318 in the name of
respondent Victoriano; and (c) the Second Accretion, covered
by OCT No. 21481 in the name of all respondents. To recount,
Francisco, et al. asserted co-ownership over the Motherland,
alleging that Ciriaco agreed to hold the same in trustfor their
predecessors-in-interest Alejandra and Balbina upon issuance
of the title in his name. Likewise, they alleged that respondents
acquired the First and Second Accretions by means of
fraudand deceit.
When property is registered in another’s name, an implied or
constructive trust is created by law in favor of the true
owner.38 Article 1456 of the Civil Code provides that a person
acquiring property through fraud becomes, by operation of law,
a trustee ofan implied trust for the benefit of the real owner of
the property. An action for reconveyance based on an implied
trust prescribes in ten (10) years, reckoned from the date of
registration of the deed or the date ofissuance of the certificate
of title over the property,39 if the plaintiff is not in possession.
However, if the plaintiff is in possession of the property, the
action is imprescriptible. As held in the case of Lasquite v.
Victory Hills, Inc.:40
An action for reconveyance based on an implied trust
prescribes in 10 years. The reference point of the 10-
yearprescriptive period is the date of registration of the deed or
the issuance of the title. The prescriptive period applies only if
there is an actual need to reconvey the property as when the
plaintiff is not in possession of the property. However, if the
plaintiff, as the realowner of the property also remains in
possession of the property, the prescriptive period to recover
title and possession of the property does not run against him.
In such a case, an action for reconveyance, if nonetheless
filed, would be in the nature of a suit for quieting of title, an
action that is imprescriptible.41 (Emphases supplied)
Based on the foregoing, Francisco, et al. had then a period of
ten (10) years from the registration of the respective titles
covering the disputed properties within which to file their action
for reconveyance, taking into account the fact that they were
never in possessionof the said properties. Hence, with respect
tothe Motherland covered by OCT No. 1462 issued on
December 5, 1933 in the name of Ciriaco, an action for
reconveyance therefor should have been filed until December
5, 1943; with respect to the First Accretion covered by OCT
No. P-318 issued on August 15, 1952in the name of
respondent Victoriano, an action of the same nature should
have been filed untilAugust 15, 1962; and, finally, with respect
to the Second Accretion covered by OCT No. 21481 issued on
November 10, 1978in the name of the respondents, a suit for
reconveyance therefor should have been filed until November
10, 1988.
A judicious perusal of the records, however, will show that the
Amended Complaint42 covering all three (3) disputed
properties was filed only on February 27, 1984. As such, it was
filed way beyond the 10-year reglementary period within which
to seek the reconveyance of two (2) of these properties,
namely, the Motherland and the First Accretion, with only the
reconveyance action with respect to the Second Accretion
having been seasonably filed. Thus, considering
thatrespondents raised prescription as a defense in their
Amended Answer,43 the Amended Complaint with respect to
the Motherland and the First Accretion ought to have
beendismissed based on the said ground, with only the cause
of action pertaining to the Second Accretion surviving. As will
be, however, discussed below, the entirety of the Amended
Complaint, including the aforesaid surviving cause of action,
would falter on its substantive merits since the existence of the
implied trust asserted in this case had not been established. In
effect, the said complaint is completely dismissible.
B. Substantive Matter: Existence of an Implied Trust.
The main thrust of Francisco, et al.’s Amended Complaint is
that an implied trust had arisen between the Imbornal sisters,
on the one hand, and Ciriaco, on the other, with respect to the
Motherland. This implied trust is anchored on their allegation
that the proceeds from the sale of the Sabangan property – an
inheritance of their predecessors, the Imbornal sisters – were
used for the then-pending homestead application filed by
Ciriaco over the Motherland. As such, Francisco, et al. claim
that they are, effectively, coowners of the Motherland together
with Ciriaco’s heirs.
An implied trust arises, not from any presumed intention of the
parties, but by operation of law in order to satisfy the demands
of justice and equity and to protect against unfair dealing or
downright fraud.44 To reiterate, Article 1456 of the Civil Code
states that "[i]f property is acquired through mistake or fraud,
the person obtaining it is, by force of law, considered a trustee
of an implied trust for the benefit of the person from whom the
property comes."
The burden of proving the existence ofa trust is on the party
asserting its existence, and such proof must be clear and
satisfactorily show the existence of the trust and its
elements.45 While implied trusts may be proven by oral
evidence, the evidence must be trustworthy and received by
the courts with extreme caution, and should not be made to
rest on loose, equivocal or indefinite declarations. Trustworthy
evidence is required because oral evidence can easily be
fabricated.46
In this case, it cannot be said, merely on the basis of the oral
evidence offered by Francisco, et al., that the Motherland had
been either mistakenly or fraudulently registered in favor of
Ciriaco. Accordingly, it cannot be said either that he was
merely a trustee of an implied trust holding the Motherland for
the benefit of the Imbornal sisters or their heirs.
As the CA had aptly pointed out,47 a homestead patent award
requires proof that the applicant meets the stringent
conditions48 set forth under Commonwealth Act No. 141, as
amended, which includes actual possession, cultivation, and
improvement of the homestead. It must be presumed,
therefore, that Ciriaco underwent the rigid process and duly
satisfied the strict conditions necessary for the grant of his
homestead patent application. As such, it is highly implausible
thatthe Motherland had been acquired and registered by
mistake or through fraudas would create an implied trust
between the Imbornal sisters and Ciriaco, especially
considering the dearth of evidence showing that the Imbornal
sisters entered into the possession of the Motherland, or a
portion thereof, orasserted any right over the same at any
point during their lifetime. Hence, when OCT No. 1462
covering the Motherland was issued in his name pursuant to
Homestead Patent No. 24991 on December 15, 1933,
Ciriaco’s titleto the Motherland had become indefeasible. It
bears to stress that the proceedings for land registration that
led to the issuance of Homestead Patent No. 24991 and
eventually, OCT No. 1462 in Ciriaco’s name are presumptively
regular and proper,49 which presumption has not been
overcome by the evidence presented by Francisco, et al.
In this light, the Court cannot fully accept and accord
evidentiary value to the oral testimony offered by Francisco, et
al. on the alleged verbal agreement between their
predecessors, the Imbornal sisters, and Ciriaco with respect to
the Motherland. Weighed against the presumed regularity of
the award of the homestead patent to Ciriaco and the lack of
evidence showing that the same was acquired and registered
by mistake or through fraud, the oral evidence of Francisco, et
al.would not effectively establish their claims of ownership. It
has been held that oral testimony as to a certain fact,
depending as it does exclusively on human memory, is not as
reliable as written or documentary evidence,50 especially since
the purported agreement transpired decades ago, or in the
1920s. Hence, with respect to the Motherland, the CA did not
err in holding that Ciriaco and his heirs are the owners thereof,
without prejudice to the rights of any subsequent purchasers
for value of the said property.
Consequently, as Francisco, et al.failed to prove their
ownership rights over the Motherland, their cause of action
with respect to the First Accretion and, necessarily, the
Second Accretion, must likewise fail. A further exposition is
apropos.
Article 457 of the Civil Code states the rule on accretion as
follows: "[t]o the owners of lands adjoining the banks of rivers
belong the accretion which they gradually receive from the
effects of the current of the waters." Relative thereto, in
Cantoja v. Lim,51 the Court, citing paragraph 32 of the Lands
Administrative Order No. 7-1 dated April 30, 1936, in relation
to Article 4 of the Spanish Law of Waters of 1866, as well as
related jurisprudence on the matter, elucidated on the
preferential right of the riparian owner over the land formed by
accretions, viz.:
Being the owner of the land adjoining the foreshore area,
respondent is the riparian or littoralowner who has preferential
right to lease the foreshore area as provided under paragraph
32 of the Lands Administrative Order No. 7-1, dated 30 April
1936, which reads:
32. Preference of Riparian Owner. – The owner of the property
adjoining foreshore lands, marshylands or lands covered with
water bordering upon shores or banks of navigable lakes or
rivers, shall be given preference to apply for such lands
adjoining his property as may not be needed for the public
service, subject to the laws and regulations governing lands of
this nature, provided that he applies therefor within sixty (60)
days from the date he receives a communication from the
Director of Lands advising him of his preferential right.
The Court explained in Santulan v. The Executive
Secretary[170 Phil. 567; 80 SCRA 548 (1977)] the reason for
such grant of preferential right to the riparian or littoral owner,
thus:
Now, then, is there any justification for giving to the littoral
owner the preferential right to lease the foreshore land
abutting on his land?
That rule in paragraph 32 is in consonance with Article 4 of the
Spanish Law of Waters of 1866 which provides that, while
lands added to the shore by accretions and alluvial deposits
caused by the action of the sea form part of the public domain,
such lands, "when they are no longer washed by the waters of
the sea and are not necessary for purposes of public utility, or
for the established [sic] of special industries, or for the coast
guard service, "shall be declared by the Government "to be the
property of the owners of the estates adjacent thereto and as
increment thereof."
In other words, article 4 recognizes the preferential right of the
littoral owner (riparian according to paragraph 32) to the
foreshore land formed by accretionsor alluvial deposits due to
the action of the sea.1âwphi1
The reason for that preferential right is the same as the
justification for giving accretions to the riparianowner, which is
that accretion compensates the riparian owner for the
diminutions which his land suffers by reason of the destructive
force of the waters. So, in the case of littoral lands, he who
loses by the encroachments of the sea should gain by its
recession.52
Accordingly, therefore, alluvial deposits along the banks of a
creek or a river do not form part of the public domain as the
alluvial property automatically belongs to the owner of the
estate to which it may have been added. The only restriction
provided for by law is that the owner of the adjoining property
must register the same under the Torrens system; otherwise,
the alluvial property may be subject to acquisition through
prescription by third persons.53
In this case, Francisco, et al. and, now, their heirs, i.e., herein
petitioners,. are not the riparian owners of the Motherland to
which the First Accretion had .attached, hence, they cannot
assert ownership over the First Accretion. Consequently, as
the Second Accretion had merely attached to the First
Accretion, they also have no right over the Second Accretion.
Neither were they able to show that they acquired these
properties through prescription as it was ·not established that
they were in possession of any of them. Therefore, whether
through accretion or, independently, through prescription, the
discernible conclusion is that Francisco et al. and/or
petitioners' claim of title over the First and Second Accretions JOSE PORTUGAL PEREZ
had not been substantiated, and, as a result, said properties Associate Justice
cannot be reconveyed in their favor. This is especially so since
on the other end of the fray lie respondents armed with a ATTESTATION
certificate of title in their names covering the First and Second
Accretions coupled with their possession thereof, both of I attest that the conclusions in the above Decision had been
which give rise to the superior credibility of their own claim. reached in consultation before the case was assigned to the
Hence, petitioners' action for reconveyan.ce with respect to writer of the opinion of the Court's Division.
both accretions must altogether fail.
ANTONIO T. CARPIO
WHEREFORE, the petition is DENIED. The Decision dated Associate Justice
November 28, 2006 and the Resolution dated May 7, 2008 of Chairperson, Second Division
the Court of Appeals in CA-G.R. CV No. 57618 are hereby
AFFIRMED, and a new judgment is entered DISMISSING the CERTIFICATION
Amended Complaint dated February 27, 1984 filed in said
case. Pursuant to Section 13, Article VIII of the Constitution, and the
Division Chairperson's Attestation, I certify that the conclusions
SO ORDERED. in the above Decision had been reached in consultation before
the case was assigned to the writer of the opinion of the
ESTELA M. PERLAS-BERNABE Court's Division.
Associate Justice
MARIA LOURDES P. A. SERENO
WE CONCUR: Chief Justice

ANTONIO T. CARPIO 306

Associate Justice
Chairperson
.R. No. 193787 April 7, 2014
MARIANO C. DEL
ARTURO D. BRION
CASTILLO SPOUSES JOSE C. ROQUE AND BEATRIZ DELA CRUZ
Associate Justice
Associate Justice ROQUE, with deceased Jose C. Roque represented by his
substitute heir JOVETTE ROQUE-LIBREA, Petitioners,
vs.
MA. PAMELA P. AGUADO, FRUCTUOSO C. SABUG, JR.,
NATIONAL COUNCIL OF CHURCHES IN THE PHILIPPINES
(NCCP), represented by its Secretary General SHARON
ROSE JOY RUIZ-DUREMDES, LAND BANK OF THE
PHILIPPINES (LBP), represented by Branch Manager
EVELYN M. MONTERO, ATTY. MARIO S.P. DIAZ, in his
Official Capacity as Register of Deeds for Rizal, Morong
Branch, and CECILIO U. PULAN, in his Official Capacity as
Sheriff, Office of the Clerk of Court, Regional Trial Court,
Binangonan, Rizal,Respondents.
DECISION
PERLAS-BERNABE, J.:
Assailed in this petition for review on certiorari1 are the
Decision2 dated May 12, 2010 and the Resolution3 dated
September 15, 2010 of the Court of Appeals (CA) in CA G.R.
CV No. 92113 which affirmed the Decision4 dated July 8, 2008
of the Regional Trial Court of Binangonan, Rizal, Branch 69
(RTC) that dismissed Civil Case Nos. 03-022 and 05-003 for
reconveyance, annulment of sale, deed of real estate
mortgage, foreclosure and certificate of sale, and damages.
The Facts
The property subject of this case is a parcel of land with an
area of 20,862 square meters (sq. m.), located in Sitio Tagpos,
Barangay Tayuman, Binangonan, Rizal, known as Lot 18089.5
On July 21, 1977, petitioners-spouses Jose C. Roque and
Beatriz dela Cruz Roque (Sps. Roque) and the original owners
of the then unregistered Lot 18089 – namely, Velia R. Rivero
(Rivero), Magdalena Aguilar, Angela Gonzales, Herminia R.
Bernardo, Antonio Rivero, Araceli R. Victa, Leonor R. Topacio,
and Augusto Rivero (Rivero, et al.) – executed a Deed of
Conditional Sale of Real Property6 (1977 Deed of Conditional
Sale) over a 1,231-sq. m. portion of Lot 18089 (subject
portion) for a consideration of ₱30,775.00. The parties agreed
that Sps. Roque shall make an initial payment of ₱15,387.50
upon signing, while the remaining balance of the purchase
price shall be payable upon the registration of Lot 18089, as
well as the segregation and the concomitant issuance of a
separate title over the subject portion in their names. After the
deed’s execution, Sps. Roque took possession and introduced
improvements on the subject portion which they utilized as a
balut factory.7
On August 12, 1991, Fructuoso Sabug, Jr. (Sabug, Jr.), former
Treasurer of the National Council of Churches in the
Philippines (NCCP), applied for a free patent over the entire
Lot 18089 and was eventually issued Original Certificate of
Title (OCT) No. M-59558 in his name on October 21, 1991. On
June 24, 1993, Sabug, Jr. and Rivero, in her personal capacity
and in representation of Rivero, et al., executed a Joint
Affidavit9 (1993 Joint Affidavit), acknowledging that the subject
portion belongs to Sps. Roque and expressed their willingness
to segregate the same from the entire area of Lot 18089.
On December 8, 1999, however, Sabug, Jr., through a Deed
of Absolute Sale10 (1999 Deed of Absolute Sale), sold Lot
18089 to one Ma. Pamela P. Aguado (Aguado) for
₱2,500,000.00, who, in turn, caused the cancellation of OCT
No. M-5955 and the issuance of Transfer Certificate of Title
(TCT) No. M-96692 dated December 17, 199911 in her name.
Thereafter, Aguado obtained an ₱8,000,000.00 loan from the
Land Bank of the Philippines (Land Bank) secured by a
mortgage over Lot 18089.12 When she failed to pay her loan
obligation, Land Bank commenced extra-judicial foreclosure
proceedings and eventually tendered the highest bid in the
auction sale. Upon Aguado’s failure to redeem the subject
property, Land Bank consolidated its ownership, and TCT No.
M-11589513 was issued in its name on July 21, 2003.14
On June 16, 2003, Sps. Roque filed a complaint15 for
reconveyance, annulment of sale, deed of real estate
mortgage, foreclosure, and certificate of sale, and damages
before the RTC, docketed as Civil Case No. 03-022, against
Aguado, Sabug, Jr., NCCP, Land Bank, the Register of Deeds
of Morong, Rizal, and Sheriff Cecilio U. Pulan, seeking to be
declared as the true owners of the subject portion which had
been erroneously included in the sale between Aguado and
Sabug, Jr., and, subsequently, the mortgage to Land Bank,
both covering Lot 18089 in its entirety.
In defense, NCCP and Sabug, Jr. denied any knowledge of
the 1977 Deed of Conditional Sale through which the subject
portion had been purportedly conveyed to Sps. Roque.16
For her part, Aguado raised the defense of an innocent
purchaser for value as she allegedly derived her title (through
the 1999 Deed of Absolute Sale) from Sabug, Jr., the
registered owner in OCT No. M-5955, covering Lot 18089,
which certificate of title at the time of sale was free from any
lien and/or encumbrances. She also claimed that Sps.
Roque’s cause of action had already prescribed because their
adverse claim was made only on April 21, 2003, or four (4)
years from the date OCT No. M-5955 was issued in Sabug,
Jr.’s name on December 17, 1999.17
On the other hand, Land Bank averred that it had no
knowledge of Sps. Roque’s claim relative to the subject
portion, considering that at the time the loan was taken out,
Lot 18089 in its entirety was registered in Aguado’s name and
no lien and/or encumbrance was annotated on her certificate
of title.18
Meanwhile, on January 18, 2005, NCCP filed a separate
complaint19 also for declaration of nullity of documents and
certificates of title and damages, docketed as Civil Case No.
05-003. It claimed to be the real owner of Lot 18089 which it
supposedly acquired from Sabug, Jr. through an oral contract
of sale20 in the early part of 1998, followed by the execution of
a Deed of Absolute Sale on December 2, 1998 (1998 Deed of
Absolute Sale).21 NCCP also alleged that in October of the
same year, it entered into a Joint Venture Agreement (JVA)
with Pilipinas Norin Construction Development Corporation
(PNCDC), a company owned by Aguado’s parents, for the
development of its real properties, including Lot 18089, into a
subdivision project, and as such, turned over its copy of OCT
No. M-5955 to PNCDC.22 Upon knowledge of the purported
sale of Lot 18089 to Aguado, Sabug, Jr. denied the transaction
and alleged forgery. Claiming that the Aguados23 and PNCDC
conspired to defraud NCCP, it prayed that PNCDC’s corporate
veil be pierced and that the Aguados be ordered to pay the
amount of ₱38,092,002.00 representing the unrealized profit
from the JVA.24 Moreover, NCCP averred that Land Bank
failed to exercise the diligence required to ascertain the true
owners of Lot 18089. Hence, it further prayed that: (a) all acts
of ownership and dominion over Lot 18089 that the bank might
have done or caused to be done be declared null and void; (b)
it be declared the true and real owners of Lot 18089; and (c)
the Register of Deeds of Morong, Rizal be ordered to cancel
any and all certificates of title covering the lot, and a new one
be issued in its name.25 In its answer, Land Bank reiterated its
stance that Lot 18089 was used as collateral for the
₱8,000,000.00 loan obtained by the Countryside Rural Bank,
Aguado, and one Bella Palasaga. There being no lien and/ or
encumbrance annotated on its certificate of title, i.e., TCT No.
M-115895, it cannot be held liable for NCCP’s claims. Thus, it
prayed for the dismissal of NCCP’s complaint.26
On September 7, 2005, Civil Case Nos. 02-022 and 05-003
were ordered consolidated.27
The RTC Ruling
After due proceedings, the RTC rendered a Decision28 dated
July 8, 2008, dismissing the complaints of Sps. Roque and
NCCP.
With respect to Sps. Roque’s complaint, the RTC found that
the latter failed to establish their ownership over the subject
portion, considering the following: (a) the supposed owners-
vendors, i.e., Rivero, et al., who executed the 1977 Deed of
Conditional Sale, had no proof of their title over Lot 18089; (b)
the 1977 Deed of Conditional Sale was not registered with the
Office of the Register of Deeds;29 (c) the 1977 Deed of
Conditional Sale is neither a deed of conveyance nor a
transfer document, as it only gives the holder the right to
compel the supposed vendors to execute a deed of absolute
sale upon full payment of the consideration; (d) neither Sps.
Roque nor the alleged owners-vendors, i.e., Rivero, et al.,
have paid real property taxes in relation to Lot 18089; and (e)
Sps. Roque’s occupation of the subject portion did not ripen
into ownership that can be considered superior to the
ownership of Land Bank.30 Moreover, the RTC ruled that Sps.
Roque’s action for reconveyance had already prescribed,
having been filed ten (10) years after the issuance of OCT No.
M-5955.31
On the other hand, regarding NCCP’s complaint, the RTC
observed that while it anchored its claim of ownership over Lot
18089 on the 1998 Deed of Absolute Sale, the said deed was
not annotated on OCT No. M-5955. Neither was any certificate
of title issued in its name nor did it take possession of Lot
18089 or paid the real property taxes therefor. Hence, NCCP’s
claim cannot prevail against Land Bank’s title, which was
adjudged by the RTC as an innocent purchaser for value.
Also, the RTC disregarded NCCP’s allegation that the
signature of Sabug, Jr. on the 1999 Deed of Absolute Sale in
favor of Aguado was forged because his signatures on both
instruments bear semblances of similarity and appear genuine.
Besides, the examiner from the National Bureau of
Investigation, who purportedly found that Sabug, Jr.’s
signature thereon was spurious leading to the dismissal of a
criminal case against him, was not presented as a witness in
the civil action.32
Finally, the RTC denied the parties’ respective claims for
damages.33
The CA Ruling
On appeal, the Court of Appeals (CA) affirmed the foregoing
RTC findings in a Decision34 dated May 12, 2010. While Land
Bank was not regarded as a mortgagee/purchaser in good
faith with respect to the subject portion considering Sps.
Roque’s possession thereof,35 the CA did not order its
reconveyance or segregation in the latter’s favor because of
Sps. Roque’s failure to pay the remaining balance of the
purchase price. Hence, it only directed Land Bank to respect
Sps. Roque’s possession with the option to appropriate the
improvements introduced thereon upon payment of
compensation.36
As regards NCCP, the CA found that it failed to establish its
right over Lot 18089 for the following reasons: (a) the sale to it
of the lot by Sabug, Jr. was never registered; and (b) there is
no showing that it was in possession of Lot 18089 or any
portion thereof from 1998. Thus, as far as NCCP is concerned,
Land Bank is a mortgagee/purchaser in good faith.37
Aggrieved, both Sps. Roque38 and NCCP39 moved for
reconsideration but were denied by the CA in a
Resolution40dated September 15, 2010, prompting them to
seek further recourse before the Court.
The Issue Before the Court
The central issue in this case is whether or not the CA erred in
not ordering the reconveyance of the subject portion in Sps.
Roque’s favor.
Sps. Roque maintain that the CA erred in not declaring them
as the lawful owners of the subject portion despite having
possessed the same since the execution of the 1977 Deed of
Conditional Sale, sufficient for acquisitive prescription to set in
in their favor.41 To bolster their claim, they also point to the
1993 Joint Affidavit whereby Sabug, Jr. and Rivero
acknowledged their ownership thereof.42 Being the first
purchasers and in actual possession of the disputed portion,
they assert that they have a better right over the 1,231- sq. m.
portion of Lot 18089 and, hence, cannot be ousted therefrom
by Land Bank, which was adjudged as a ortgagee/purchaser
in bad faith, pursuant to Article 1544 of the Civil Code.43
In opposition, Land Bank espouses that the instant petition
should be dismissed for raising questions of fact, in violation of
the proscription under Rule 45 of the Rules of Court which
allows only pure questions of law to be raised.44 Moreover, it
denied that ownership over the subject portion had been
acquired by Sps. Roque who admittedly failed to pay the
remaining balance of the purchase price.45 Besides, Land
Bank points out that Sps. Roque’s action for reconveyance
had already prescribed.46
Instead of traversing the arguments of Sps. Roque, NCCP, in
its Comment47 dated December 19, 2011, advanced its own
case, arguing that the CA erred in holding that it failed to
establish its claimed ownership over Lot 18089 in its entirety.
Incidentally, NCCP’s appeal from the CA Decision dated May
12, 2010 was already denied by the Court,48 and hence, will no
longer be dealt with in this case.
The Court’s Ruling
The petition lacks merit.
The essence of an action for reconveyance is to seek the
transfer of the property which was wrongfully or erroneously
registered in another person’s name to its rightful owner or to
one with a better right.49 Thus, it is incumbent upon the
aggrieved party to show that he has a legal claim on the
property superior to that of the registered owner and that the
property has not yet passed to the hands of an innocent
purchaser for value.50
Sps. Roque claim that the subject portion covered by the 1977
Deed of Conditional Sale between them and Rivero, et al. was
wrongfully included in the certificates of title covering Lot
18089, and, hence, must be segregated therefrom and their
ownership thereof be confirmed. The salient portions of the
said deed state:
DEED OF CONDITIONAL SALE OF REAL PROPERTY
KNOW ALL MEN BY THESE PRESENTS:
xxxx
That for and in consideration of the sum of THIRTY
THOUSAND SEVEN HUNDRED SEVENTY FIVE PESOS
(₱30,775.00), Philippine Currency, payable in the manner
hereinbelow specified, the VENDORS do hereby sell, transfer
and convey unto the VENDEE, or their heirs, executors,
administrators, or assignors, that unsegregated portion of the
above lot, x x x.
That the aforesaid amount shall be paid in two installments,
the first installment which is in the amount of __________
(₱15,387.50) and the balance in the amount of __________
(₱15,387.50), shall be paid as soon as the described portion of
the property shall have been registered under the Land
Registration Act and a Certificate of Title issued accordingly;
That as soon as the total amount of the property has been
paid and the Certificate of Title has been issued, an absolute
deed of sale shall be executed accordingly;
x x x x51
Examining its provisions, the Court finds that the stipulation
above-highlighted shows that the 1977 Deed of Conditional
Sale is actually in the nature of a contract to sell and not one
of sale contrary to Sps. Roque’s belief.52 In this relation, it has
been consistently ruled that where the seller promises to
execute a deed of absolute sale upon the completion by the
buyer of the payment of the purchase price, the contract is
only a contract to sell even if their agreement is denominated
as a Deed of Conditional Sale,53 as in this case. This treatment
stems from the legal characterization of a contract to sell, that
is, a bilateral contract whereby the prospective seller, while
expressly reserving the ownership of the subject property
despite delivery thereof to the prospective buyer, binds himself
to sell the subject property exclusively to the prospective buyer
upon fulfillment of the condition agreed upon, such as, the full
payment of the purchase price.54 Elsewise stated, in a contract
to sell, ownership is retained by the vendor and is not to pass
to the vendee until full payment of the purchase
price.55 Explaining the subject matter further, the Court, in
Ursal v. CA,56 held that:
[I]n contracts to sell the obligation of the seller to sell becomes
demandable only upon the happening of the suspensive
condition, that is, the full payment of the purchase price by the
buyer. It is only upon the existence of the contract of sale that
the seller becomes obligated to transfer the ownership of the
thing sold to the buyer. Prior to the existence of the contract of
sale, the seller is not obligated to transfer the ownership to the
buyer, even if there is a contract to sell between them.
Here, it is undisputed that Sps. Roque have not paid the final
installment of the purchase price.57 As such, the condition
which would have triggered the parties’ obligation to enter into
and thereby perfect a contract of sale in order to effectively
transfer the ownership of the subject portion from the sellers
(i.e., Rivero et al.) to the buyers (Sps. Roque) cannot be
deemed to have been fulfilled. Consequently, the latter cannot
validly claim ownership over the subject portion even if they
had made an initial payment and even took possession of the
same.58
The Court further notes that Sps. Roque did not even take any
active steps to protect their claim over the disputed portion.
This remains evident from the following circumstances
appearing on record: (a) the 1977 Deed of Conditional Sale
was never registered; (b) they did not seek the actual/physical
segregation of the disputed portion despite their knowledge of
the fact that, as early as 1993, the entire Lot 18089 was
registered in Sabug, Jr.’s name under OCT No. M-5955; and
(c) while they signified their willingness to pay the balance of
the purchase price,59Sps. Roque neither compelled Rivero et
al., and/or Sabug, Jr. to accept the same nor did they consign
any amount to the court, the proper application of which would
have effectively fulfilled their obligation to pay the purchase
price.60 Instead, Sps. Roque waited 26 years, reckoned from
the execution of the 1977 Deed of Conditional Sale, to institute
an action for reconveyance (in 2003), and only after Lot 18089
was sold to Land Bank in the foreclosure sale and title thereto
was consolidated in its name. Thus, in view of the foregoing,
Sabug, Jr. – as the registered owner of Lot 18089 borne by the
grant of his free patent application – could validly convey said
property in its entirety to Aguado who, in turn, mortgaged the
same to Land Bank. Besides, as aptly observed by the RTC,
Sps. Roque failed to establish that the parties who sold the
property to them, i.e., Rivero, et al., were indeed its true and
lawful owners.61 In fine, Sps. Roque failed to establish any
superior right over the subject portion as against the registered
owner of Lot 18089, i.e., Land Bank, thereby warranting the
dismissal of their reconveyance action, without prejudice to
their right to seek damages against the vendors, i.e., Rivero et
al.62 As applied in the case of Coronel v. CA:63
It is essential to distinguish between a contract to sell and a
conditional contract of sale specially in cases where the
subject property is sold by the owner not to the party the seller
contracted with, but to a third person, as in the case at bench.
In a contract to sell, there being no previous sale of the
property, a third person buying such property despite the
fulfilment of the suspensive condition such as the full payment
of the purchase price, for instance, cannot be deemed a buyer
in bad faith and the prospective buyer cannot seek the relief of
reconveyance of the property.
There is no double sale in such case.1âwphi1 Title to the
property will transfer to the buyer after registration because
there is no defect in the owner-seller’s title per se, but the
latter, of course, may be sued for damages by the intending
buyer. (Emphasis supplied)
On the matter of double sales, suffice it to state that Sps.
Roque’s reliance64 on Article 154465 of the Civil Code has been
misplaced since the contract they base their claim of
ownership on is, as earlier stated, a contract to sell, and not
one of sale. In Cheng v. Genato,66 the Court stated the WHEREFORE, the petition is DENIED. The Decision dated
circumstances which must concur in order to determine the May 12, 2010 and the Resolution dated September 15, 2010
applicability of Article 1544, none of which are obtaining in this of the Court of Appeals in CAG.R. CV No. 92113 are hereby
case, viz.: AFFIRMED.

(a) The two (or more) sales transactions in issue must SO ORDERED.
pertain to exactly the same subject matter, and must be
valid sales transactions; ESTELA M. PERLAS-BERNABE
Associate Justice
(b) The two (or more) buyers at odds over the rightful
ownership of the subject matter must each represent WE CONCUR:
conflicting interests; and

(c) The two (or more) buyers at odds over the rightful REPUBLIC OF THE PHILIPPINES, G.R. No. 170375
ownership of the subject matter must each have bought Petitioner,
from the same seller.

Finally, regarding Sps. Roque’s claims of acquisitive - versus -

prescription and reimbursement for the value of the
improvements they have introduced on the subject
property,67 it is keenly observed that none of the arguments HON. MAMINDIARA P. MANGOTARA, in
therefor were raised before the trial court or the his capacity as Presiding Judge of the
CA.68 Accordingly, the Court applies the well-settled rule that Regional Trial Court, Branch 1, Iligan
litigants cannot raise an issue for the first time on appeal as City, Lanao del Norte, and MARIA
this would contravene the basic rules of fair play and justice. In CRISTINA FERTILIZER CORPORATION,
any event, such claims appear to involve questions of fact and the PHILIPPINE NATIONAL BANK,
which are generally prohibited under a Rule 45 petition.69 Respondents,
x-----------------------x
With the conclusions herein reached, the Court need not LAND TRADE REALTY CORPORATION,
belabor on the other points raised by the parties, and Petitioner,
ultimately finds it proper to proceed with the denial of the
petition. G.R. No. 170505
- versus -
 x-----------------------x
NATIONAL TRANSMISSION
NATIONAL POWER CORPORATION and CORPORATION,
NATIONAL TRANSMISSION Petitioner,
CORPORATION (TRANSCO),
Respondents,
x-----------------------x - versus -
NATIONAL POWER CORPORATION,
Petitioner,
HON. COURT OF APPEALS (Special
Twenty-Third Division, Cagayan de Oro
- versus - City), and LAND TRADE REALTY G.R. Nos. 173563-64
G.R. Nos. 173355-56
CORPORATION as represented by Atty.
Max C. Tabimina,
HON. COURT OF APPEALS (Special Respondents,
Twenty-Third Division, Cagayan de Oro x-----------------------x
City), and LAND TRADE REALTY
CORPORATION, LAND TRADE REALTY CORPORATION,
Respondents, Petitioner,
x-----------------------x
REPUBLIC OF THE PHILIPPINES, - versus -
Petitioner,
DEMETRIA CONFESOR VIDAL and
AZIMUTH INTERNATIONAL
- versus - DEVELOPMENT CORPORATION,
Respondents,
x-----------------------x
DEMETRIA CACHO, represented by G.R. No. 173401 TEOFILO CACHO and/or ATTY.
alleged Heirs DEMETRIA CONFESOR GODOFREDO CABILDO, G.R. No. 178779
VIDAL and/or TEOFILO CACHO, AZIMUTH Petitioner,
INTERNATIONAL DEVELOPMENT
CORPORATION and LAND TRADE
REALTY CORPORATION,
Respondents.
- versus - In G.R. No. 170375, the Republic of the Philippines
(Republic), by way of consolidated Petitions for Review
on Certiorari and for Certiorari under Rules 45 and 65 of the
Rules of Court, respectively, seeks to set aside the issuances
of Judge Mamindiara P. Mangotara (Judge Mangotara) of the
DEMETRIA CONFESOR VIDAL and Regional Trial Court, Branch 1 (RTC-Branch 1) of Iligan City,
AZIMUTH INTERNATIONAL G.R. No. 178894 Lanao del Norte, in Civil Case No. 106, particularly, the: (1)
DEVELOPMENT CORPORATION, Resolution[1] dated July 12, 2005 which, in part, dismissed the
Present: Complaint for Expropriation of the Republic for the latters
Respondents.
failure to implead indispensable parties and forum shopping;
CORONA, C.J., and (2) Resolution[2] dated October 24, 2005, which denied the
Chairperson, Partial Motion for Reconsideration of the Republic.
VELASCO, JR.,
LEONARDO-DE CASTRO, G.R. Nos. 178779 and 178894 are two Petitions for
DEL CASTILLO, and
Review on Certiorari under Rule 45 of the Rules of Court,
PEREZ, JJ. where Landtrade Realty Corporation (LANDTRADE), Teofilo
Cacho, and/or Atty. Godofredo Cabildo assail the
Promulgated: Decision[3] dated January 19, 2007 and Resolution[4] dated July
4, 2007 of the Court of Appeals in CA-G.R. CV No. 00456. The
July 7, 2010 Court of Appeals affirmed the Decision[5] dated July 17, 2004
x-------------------------------------------- of the Regional Trial Court, Branch 3 (RTC-Branch 3)
------x of Iligan City, Lanao del Norte, in Civil Case No. 4452, granting
the Petition for Quieting of Title, Injunction and Damages filed
by Demetria Vidal and Azimuth International Development
DECISION Corporation (AZIMUTH) against Teofilo Cacho and Atty.
Godofredo Cabildo.
LEONARDO-DE CASTRO, J.:
G.R. No. 170505 is a Petition for Review on Certiorari under
Before the Court are seven consolidated Petitions for Review Rule 45 of the Rules of Court in which LANDTRADE urges the
on Certiorari and a Petition for Certiorari under Rules 45 and Court to reverse and set aside the Decision[6] dated November
65 of the Rules of Court, respectively, arising from actions for 23, 2005 of the Court of Appeals in CA-G.R. SP Nos. 85714
quieting of title, expropriation, ejectment, and reversion, which and 85841. The appellate court annulled several issuances of
all involve the same parcels of land. the Regional Trial Court, Branch 5 (RTC-Branch 5) of Iligan
City, Lanao del Norte, and its sheriff, in Civil Case No. 6613,
specifically, the: (1) Order[7] dated August 9, 2004 granting the
Motion for Execution Pending Appeal of LANDTRADE; (2) Writ
of Execution[8] dated August 10, 2004; (3) two Notices of
Garnishment[9] both dated August 11, 2004, and (4)
Notification[10] dated August 11, 2004. These issuances of the
RTC-Branch 5 allowed and/or enabled execution pending
appeal of the Decision[11] dated February 17, 2004 of the
Municipal Trial Court in Cities (MTCC), Branch 2 of Iligan City,
Lanao del Norte, favoring LANDTRADE in Civil Case No.
11475-AF, the ejectment case said corporation instituted
against the National Power Corporation (NAPOCOR) and the
National Transmission Corporation (TRANSCO).
G.R. Nos. 173355-56 and 173563-64 are two Petitions
for Certiorari and Prohibition under Rule 65 of the Rules of
Court with prayer for the immediate issuance of a Temporary
Restraining Order (TRO) and/or Writ of Preliminary Injunction
filed separately by NAPOCOR and TRANSCO. Both Petitions
seek to annul the Resolution[12] dated June 30, 2006 of the
Court of Appeals in the consolidated cases of CA-G.R. SP
Nos. 00854 and 00889, which (1) granted the Omnibus Motion
of LANDTRADE for the issuance of a writ of execution and the
designation of a special sheriff for the enforcement of the
Decision[13]dated December 12, 2005 of the RTC-Branch 1 in
Civil Case No. 6613, and (2) denied the applications of
NAPOCOR and TRANSCO for a writ of preliminary injunction
to enjoin the execution of the same RTC Decision. The
Decision dated December 12, 2005 of RTC-Branch 1 in Civil
Case No. 6613 affirmed the Decision dated February 17, 2004
of the MTCC in Civil Case No. 11475-AF, favoring
LANDTRADE.
G.R. No. 173401 involves a Petition for Review
on Certiorari under Rule 45 of the Rules of Court filed by the
Republic, which raises pure questions of law and seeks the
reversal of the following issuances of the Regional Trial Court,
Branch 4 (RTC-Branch 4) of Iligan City, Lanao del Norte, in
Civil Case No. 6686, an action for cancellation of titles and
reversion: (1) Order[14] dated December 13, 2005 dismissing
the Complaint in Civil Case No. 6686; and (2) Order[15] dated
May 16, 2006, denying the Motion for Reconsideration of the
Republic.
I
THE PRECEDING CASES
The consolidated seven cases have for their common
genesis the 1914 case of Cacho v. Government of the
United States[16] (1914 Cacho case).
The 1914 Cacho Case
Sometime in the early 1900s, the late Doa Demetria
Cacho (Doa Demetria) applied for the registration of two
parcels of land: (1) Lot 1 of Plan II-3732, the smaller parcel
with an area of 3,635 square meters or 0.36 hectares (Lot 1);
and (2) Lot 2 of Plan II-3732, the larger parcel with an area
of 378,707 square meters or 37.87 hectares (Lot 2). Both
parcels are situated in what was
then the Municipality of Iligan, Moro Province, which later
became Sitio Nunucan, then Brgy. Suarez, in Iligan City,
Lanao del Norte. Doa Demetrias applications for registration
were docketed as GLRO Record Nos. 6908 and 6909.
The application in GLRO Record No.
6908 covered Lot 1, the smaller parcel of land. Doa Demetria
allegedly acquired Lot 1 by purchase from Gabriel Salzos
(Salzos). Salzos, in turn, bought Lot 1 from Datto Darondon
and his wife Alanga, evidenced by a deed of sale in favor of
Salzos signed solely by Alanga, on behalf of Datto Darondon.
The application in GLRO Record No.
6909 involved Lot 2, the bigger parcel of land. Doa Demetria
purportedly purchased Lot 2 from Datto Bunglay.Datto
Bunglay claimed to have inherited Lot 2 from his uncle, Datto
Anandog, who died without issue.
Only the Government opposed Doa Demetrias
applications for registration on the ground that the two parcels
of land were the property of the United States and formed part
of a military reservation, generally known as Camp Overton.
On December 10, 1912, the land registration court
(LRC) rendered its Decision in GLRO Record Nos. 6908 and
6909.
Based on the evidence, the LRC made the following
findings in GLRO Record No. 6908:
6th. The court is convinced from the
proofs that the small parcel of land sold by the
Moro woman Alanga was the home of herself
and her husband, Darondon, and was their
conjugal property; and the court so finds.
xxxx
As we have seen, the deed on which
applicants title to the small parcel rests, is
executed only by the Moro woman Alanga, wife
of Datto Darondon, which is not permitted either
by the Moro laws or the Civil Code of the
Philippine Islands. It appears that the husband
of Alanga, Datto Darondon, is alive yet,
and before admitting this parcel to
registration it is ordered that a deed from
Datto Darondon, husband of Alanga, be
presented, renouncing all his rights in the
small parcel of land object of Case No. 6908,
in favor of the applicant.[17] (Emphases
supplied.)
In GLRO Record No. 6909, the LRC observed and
concluded that:
A tract of land 37 hectares in area,
which is the extent of the land under discussion,
is larger than is cultivated ordinarily by the
Christian Filipinos. In the Zamboanga cadastral
case of thousands of parcels now on trial before
this court, the average size of the parcels is not
above 3 or 4 hectares, and the court doubts
very much if a Moro with all his family could
cultivate as extensive a parcel of land as the
one in question. x x x
xxxx
The court is also convinced from the
proofs that the small portion in the southern
part of the larger parcel, where, according to
the proofs, Datto Anandog had his house and
where there still exist some cocos and fruit
trees, was the home of the said Moro Datto
Anandog; and the court so finds. As to the
rest of the large parcel the court does not
find the title of Datto Bunglay
established. According to his own declaration
his residence on this land commenced only a
few days before the sale.He admitted that the
coco trees he is supposed to have planted had
not yet begun to bear fruit at the time of the
sale, and were very small. Datto Duroc
positively denies that Bunglay lived on the land,
and it clearly appears that he was not on the
land when it was first occupied by the
military. Nor does Datto Bunglay claim to have
planted the three mango trees by the roadside
near point 25 of the plan. The court believes
that all the rest of this parcel, not occupied nor
cultivated by Datto Anandog, was land claimed
by Datto Duroc and also by Datto Anandog and
possibly by other dattos as a part of their
general jurisdiction, and that it is the class of
land that Act No. 718 prohibits the sale of, by
the dattos, without the express approval of the
Government.
It is also found that Datto Bunglay is the
nephew of Dato Anandog, and that the Moro
woman Alanga, grantor of the small parcel, is
the sister of Datto Anandog, and that he died
without issue.
xxxx
It appears also that according to the
provisions of the Civil Code as also the
provisions of the Luwaran Code of the Moros,
the Moro woman Alanga has an interest in the
portion of land left by her deceased brother,
Datto Anandog. By article LXXXV, section 3, of
the Luwaran Code, it will be seen that the
brothers and sisters of a deceased Moro inherit
his property to the exclusion of the more distant
relatives. Therefore Datto Bunglay had no legal
interest whatever in the land to sell to the
applicant, Doa Demetria Cacho. But the Moro
woman, Alanga, having appeared as a witness
for the applicant without having made any claim
to the land, the court finds from this fact that
she has ratified the sale made by her nephew.
The court therefore finds that the
applicant Doa Demetria Cacho is owner of
the portion of land occupied and planted by
the deceased Datto Anandog in the southern
part of the large parcel object
of expediente No. 6909 only; and her
application as to all the rest of the land
solicited in said case is denied. And it is
ordered that a new survey of the land be
made and a corrected plan be presented,
excluding all the land not occupied and
cultivated by Datto Anandog; that said
survey be made and the corrected plan
presented on or before the 30th day of
March, 1913, with previous notice to the
commanding general of the Division of the
Philippines.
On the 8th day of December, the court
was at Camp Overton and had another ocular
inspection of the land for the purpose of fixing
 the limits of the part cultivated by Datto
Anandog, so often mentioned herein, with
previous notice to the applicant and her
husband and representative, Seor Dionisio
Vidal. Having arrived late, Seor Vidal did not
assist in the ocular inspection, which was fixed
for 3 oclock, p.m. of the day mentioned. But the
court, nevertheless, set stakes marking the
N.E., S.E., and S.W. corners of the land found
to have been cultivated by the deceased
Anandog. The N.E. limit of said land is a brook,
and the N.W. corner is the point where the
brook intersects the shore line of the sea, the
other corners mentioned being marked with
pine stakes. And it is ordered that the new
survey be made in accordance with the
points mentioned, by tracing four straight
lines connecting these four points. Between
the portion cultivated by Datto Anandog and the
mouth of the River Agus there is a high steep
hill and the court does not believe it possible to
cultivate said hill, it being covered with rocks
and forest.[18] (Emphases supplied.)
The LRC additionally decreed at the end of its
December 10, 1912 Decision:
It is further ordered that one-half of the
costs of the new survey be paid by the applicant
and the other half by the Government of
the United States, and that the applicant
present the corresponding deed from Datto
Darondon on or before the above-mentioned
30th day of March, 1913. Final decision in these
cases is reserved until the presentation of the
said deed and the new plan.[19]
Apparently dissatisfied with the foregoing LRC
judgment, Doa Demetria appealed to this Court. In its Decision
dated December 10, 1914, the Court affirmed in toto the LRC
Decision of December 10, 1912, well satisfied that the findings
of fact of the court below were fully sustained by the evidence
adduced during trial.
Eighty-three years later, in 1997, the Court was again called
upon to settle a matter concerning the registration of Lots 1
and 2 in the case of Cacho v. Court of Appeals[20] (1997
Cacho case).
The 1997 Cacho Case
On June 29, 1978, Teofilo Cacho (Teofilo), claiming to
be the late Doa Demetrias son and sole heir, filed before the
RTC a petition for reconstitution of two original certificates of
title (OCTs), docketed under the original GLRO Record Nos.
6908 and 6909.
Teofilos petition was opposed by the Republic, National
Steel Corporation (NSC), and the City of Iligan.
Acting on the motion for judgment on demurrer to
evidence filed by the Republic and NSC, the RTC initially
dismissed Teofilos petition for reconstitution of titles because
there was inadequate evidence to show the prior existence of
the titles sought to be restored. According to the RTC, the
proper remedy was a petition for the reconstitution of decrees
since it is undisputed that in Cases No. 6908 and 6909,
Decrees No. 10364 and 18969, respectively, were
issued. Teofilo sought leave of court for the filing and
admission of his amended petition, but the RTC
refused. When elevated to this Court in Cacho v. Mangotara,
docketed as G.R. No. 85495, the Court resolved to remand the
case to the RTC, with an order to the said trial court to accept
Teofilos amended petition and to hear it as one for re-issuance
of decrees.
In opposing Teofilos petition, the Republic and NSC
argued that the same suffered from jurisdictional infirmities;
that Teofilo was not the real party-in-interest; that Teofilo was
guilty of laches; that Doa Demetria was not the registered
owner of the subject parcels of land; that no decrees were
ever issued in Doa Demetrias name; and that the issuance of
the decrees was dubious and irregular.
After trial, on June 9, 1993, the RTC rendered its
Decision granting Teofilos petition and ordering the
reconstitution and re-issuance of Decree Nos. 10364 and
18969. The RTC held that the issuance of Decree No. 10364
in GLRO No. 6908 on May 9, 1913 and Decree No. 18969 in
GLRO Record No. 6909 on July 8, 1915 was sufficiently
established by the certifications and testimonies of concerned
officials. The original issuance of these decrees presupposed
a prior judgment that had become final.
On appeal, the Court of Appeals reversed the RTC
Decision dated June 9, 1993 and dismissed the petition for re-
issuance of Decree Nos. 10364 and 18969 because: (1) re-
issuance of Decree No. 18969 in GLRO Record No. 6909
could not be made in the absence of the new survey ordered
by this Court in the 1914 Cacho case; (2) the heir of a
registered owner may lose his right to recover possession of
the property and title thereto by laches; and (3) Teofilo failed to
establish his identity and existence and that he was a real
party-in-interest.
Teofilo then sought recourse from this Court in
the 1997 Cacho case. The Court reversed the judgment of the
Court of Appeals and reinstated the decision of the RTC
approving the re-issuance of Decree Nos. 10364 and
18969. The Court found that such decrees had in fact been
issued and had attained finality, as certified by the Acting
Commissioner, Deputy Clerk of Court III, Geodetic Engineer,
and Chief of Registration of the then Land Registration
Commission, now National Land Titles and Deeds Registration
Administration (NALTDRA). The Court further reasoned that:
[T]o sustain the Court of Appeals ruling as
regards requiring petitioners to fulfill the
conditions set forth in Cacho vs. U.S. would
constitute a derogation of the doctrine of res
judicata. Significantly, the issuance of the
subject decrees presupposes a prior final
judgment because the issuance of such
decrees is a mere ministerial act on part of the
Land Registration Commission (now the
NALTDRA), upon presentation of a final
judgment. It is also worth noting that the
judgment in Cacho vs. U.S. could not have
acquired finality without the prior fulfillment of
the conditions in GLRO Record No. 6908, the
presentation of the corresponding deed of sale
from Datto Dorondon on or before March 30,
1913 (upon which Decree No. 10364 was
issued on May 9, 1913); and in GLRO Record
No. 6909, the presentation of a new survey per
 decision of Judge Jorge on December 10, 1912
and affirmed by this Court on December 10,
1914 (upon which Decree No. 18969 was
issued on July 8, 1915).
Requiring the submission of a new plan as a
condition for the re-issuance of the decree
would render the finality attained by the Cacho
vs. U.S. case nugatory, thus, violating the
fundamental rule regarding res judicata. It must
be stressed that the judgment and the resulting
decree are res judicata, and these are binding
upon the whole world, the proceedings being in
the nature of proceedings in rem. Besides, such
a requirement is an impermissible assault upon
the integrity and stability of the Torrens System
of registration because it also effectively
renders the decree inconclusive.[21]
As to the issue of laches, the Court referred to the
settled doctrine that laches cannot bar the issuance of a
decree. A final decision in land registration cases can neither
be rendered inefficacious by the statute of limitations nor by
laches.
Anent the issue of the identity and existence of Teofilo
and he being a real party-in-interest, the Court found that
these were sufficiently established by the records. The Court
relied on Teofilos Affidavit of Adjudication as Doa Demetrias
sole heir, which he executed before the Philippine Consulate
General in Chicago, United States of America (U.S.A.); as well
as the publication in the Times Journal of the fact of
adjudication of Doa Demetrias estate. Teofilo also appeared
personally before the Vice Consul of the Philippine Consulate
General in Chicago to execute a Special Power of Attorney in
favor of Atty. Godofredo Cabildo (Atty. Cabildo) who
represented him in this case. The Court stressed that the
execution of public documents is entitled to the presumption of
regularity and proof is required to assail and controvert the
same.
In the Resolution dated July 28, 1997,[22] the Court
denied the Motions for Reconsideration of the Republic and
NSC.
As a result of the 1997 Cacho case, the decrees of
registration were re-issued bearing new numbers and OCTs
were issued for the two parcels of land in Doa Demetrias
name. OCT No. 0-1200 (a.f.) was based on re-issued Decree
No. N-219464 in GLRO Record No. 6908, while OCT No. 0-
1201 (a.f.) was based on re-issued Decree No. N-219465 in
GLRO Record No. 6909.
II
THE ANTECENT FACTS
OF THE PETITIONS AT BAR
The dispute over Lots 1 and 2 did not end with the
termination of the 1997 Cacho case. Another four cases
involving the same parcels of land were instituted before the
trial courts during and after the pendency of the 1997 Cacho
case. These cases are: (1) the Expropriation Case, G.R. No.
170375; (2) the Quieting of Title Case, G.R. Nos. 178779 and
178894; (3) the Ejectment or Unlawful Detainer Case, G.R.
No. 170505 (execution pending appeal before the RTC) and
G.R. Nos. 173355-56 and 173563-64 (execution pending
appeal before the Court of Appeals); and (4) the Cancellation
of Titles and Reversion Case, G.R. No. 173401. These cases
proceeded independently of each other in the courts a
quo until they reached this Court via the present Petitions. In
the Resolution[23] dated October 3, 2007, the Court
consolidated the seven Petitions considering that they either
originated from the same case or involved similar issues.
Expropriation Case
(G.R. No. 170375)
The Complaint for Expropriation was originally filed on August
15, 1983 by the Iron and Steel Authority (ISA), now the NSC,
against Maria Cristina Fertilizer Corporation (MCFC), and the
latters mortgagee, the Philippine National Bank (PNB). The
Complaint was docketed as Civil Case No. 106 and raffled to
RTC-Branch 1, presided over by Judge Mangotara.
ISA was created pursuant to Presidential Decree No.
2729[24] dated August 9, 1973, to strengthen, develop, and
promote the iron and steel industry in the Philippines. Its
existence was extended until October 10, 1988.
On November 16, 1982, during the existence of ISA,
then President Ferdinand E. Marcos issued Presidential
Proclamation No. 2239,[25] reserving in favor of ISA a parcel of
land in Iligan City, measuring 302,532 square meters or 30.25
hectares, to be devoted to the integrated steel program of the
Government. MCFC occupied certain portions of this parcel of
land. When negotiations with MCFC failed, ISA was compelled
to file a Complaint for Expropriation.
When the statutory existence of ISA expired during the
pendency of Civil Case No. 106, MCFC filed a Motion to
Dismiss the case alleging the lack of capacity to sue of
ISA. The RTC-Branch 1 granted the Motion to Dismiss in an
Order dated November 9, 1988. ISA moved for
reconsideration or, in the alternative, for the substitution of the
Republic as plaintiff in Civil Case No. 106, but the motion was
denied by RTC-Branch 1. The dismissal of Civil Case No. 106
was affirmed by the Court of Appeals, thus, ISA appealed to
this Court. In Iron and Steel Authority v. Court of
Appeals[26] (ISA case), the Court remanded the case to RTC-
Branch 1, which was ordered to allow the substitution of the
Republic for ISA as plaintiff. Entry of Judgment was made in
the ISA case on August 31, 1998. In an Order[27] dated
November 16, 2001, the RTC-Branch 1 allowed the
substitution of the Republic for ISA as plaintiff in Civil Case No.
106.
Alleging that Lots 1 and 2 involved in the 1997 Cacho
case encroached and overlapped the parcel of land subject of
Civil Case No. 106, the Republic filed with the RTC-Branch 1 a
Motion for Leave to File Supplemental Complaint dated
October 7, 2004 and to Admit the Attached Supplemental
Complaint dated September 28, 2004[28] seeking to implead in
Civil Case No. 106 Teofilo Cacho and Demetria Vidal and their
respective successors-in-interest, LANDTRADE and
AZIMUTH.
MCFC opposed the Motion for leave to file and to admit the
Supplemental Complaint on the ground that the Republic was
without legal personality to file the same because ISA was the
plaintiff in Civil Case No. 106. MCFC argued that the Republic
failed to move for the execution of the decision in the ISA
case within the prescriptive period of five years, hence, the
only remedy left was for the Republic to file an independent
action to revive the judgment. MCFC further pointed out that
the unreasonable delay of more than six years of the Republic
in seeking the substitution and continuation of the action for
expropriation effectively barred any further proceedings therein
on the ground of estoppel by laches.
In its Reply, the Republic referred to the Order dated
November 16, 2001 of the RTC-Branch 1 allowing the
substitution of the Republic for ISA.
In an Order dated April 4, 2005, the RTC-Branch 1 denied the
Motion of the Republic for leave to file and to admit its
Supplemental Complaint. The RTC-Branch 1 agreed with
MCFC that the Republic did not file any motion for execution of
the judgment of this Court in the ISA case. Since no such
motion for execution had been filed, the RTC-Branch 1 ruled
that its Order dated November 16, 2001, which effected the
substitution of the Republic for ISA as plaintiff in Civil Case No.
106, was an honest mistake. The Republic filed a Motion for
Reconsideration of the April 4, 2005 Order of the RTC-Branch
1.
MCFC then filed a Motion to Dismiss Civil Case No. 106 for:
(1) failure of the Republic to implead indispensable parties
because MCFC insisted it was not the owner of the parcels of
land sought to be expropriated; and (2) forum shopping
considering the institution by the Republic on October 13,
2004 of an action for the reversion of the same parcels subject
of the instant case for expropriation.
Judge Mangotara of RTC-Branch 1 issued a Resolution[29] on
July 12, 2005, denying for lack of merit the Motion for
Reconsideration of the Order dated April 4, 2005 filed by the
Republic, and granting the Motion to Dismiss Civil Case No.
106 filed by MCFC. Judge Mangotara justified the dismissal of
the Expropriation Case thus:
What the Republic seeks [herein] is the
expropriation of the subject parcels of
land. Since the exercise of the power of
eminent domain involves the taking of private
lands intended for public use upon payment of
just compensation to the owner x x x, then a
complaint for expropriation must, of necessity,
be directed against the owner of the land
subject thereof. In the case at bar, the decision
of the Supreme Court in Cacho v. Government
of the United States x x x, decreeing the
registration of the subject parcels of land in the
name of the late Doa Demetria Cacho has long
attained finality and is conclusive as to the
question of ownership thereof. Since MCFC,
the only defendant left in this case, is not a
proper party defendant in this complaint for
expropriation, the present case should be
dismissed.
This Court notes that the Republic [has
filed reversion proceedings] dated September
27, 2004, involving the same parcels of land,
docketed as Case No. 6686 pending before the
Regional Trial Court of Lanao del Norte, Iligan
City Branch 4. [The Republic], however, did not
state such fact in its Verification and
Certification of Non-Forum Shopping attached
to its Supplemental Complaint dated
September 28, 2004. [It is therefore] guilty of
forum shopping. Moreover, considering that in
the Reversion case, [the Republic] asserts
ownership over the subject parcels of land, it
cannot be allowed to take an inconsistent
 position in this expropriation case without
making a mockery of justice.[30]
The Republic filed a Motion for Reconsideration of the
Resolution dated July 12, 2005, insofar as it dismissed Civil
Case No. 106, but said Motion was denied by Judge
Mangatora in a Resolution[31] dated October 24, 2005.
On January 16, 2006, the Republic filed with this Court the
consolidated Petition for Review on Certiorari and Petition
for Certiorari under Rules 45 and 65 of the Rules of Court,
respectively, docketed as G.R. No. 170375.
The Quieting of Title Case
(G.R. Nos. 178779 and 178894)
Demetria Vidal (Vidal) and AZIMUTH filed on
November 18, 1998, a Petition[32] for Quieting of Title against
Teofilo, Atty. Cabildo, and the Register of Deeds of Iligan City,
which was docketed as Civil Case No. 4452 and raffled to
RTC-Branch 3.
In the Petition, Vidal claimed that she, and not Teofilo,
was the late Doa Demetrias sole surviving heir, entitled to the
parcels of land covered by OCT Nos. 0-1200 (a.f.) and 0-1201
(a.f.). She averred that she is the daughter of Francisco Cacho
Vidal (Francisco) and Fidela Arellano Confesor. Francisco was
the only child of Don Dionisio Vidal and Doa Demetria.
AZIMUTH, for its part, filed the Petition as Vidals
successor-in-interest with respect to a 23-hectare portion of
the subject parcels of land pursuant to the Memorandum of
Agreement dated April 2, 1998 and Deed of Conditional
Conveyance dated August 13, 2004, which Vidal executed in
favor of AZIMUTH.
Teofilo opposed the Petition contending that it stated
no cause of action because there was no title being disturbed
or in danger of being lost due to the claim of a third party, and
Vidal had neither legal nor beneficial ownership of the parcels
of land in question; that the matter and issues raised in the
Petition had already been tried, heard, and decided by the
RTC of Iligan City and affirmed with finality by this Court in
the 1997 Cacho case; and that the Petition was barred by the
Statute of Limitations and laches.
LANDTRADE, among other parties, was allowed by the
RTC-Branch 3 to intervene in Civil Case No.
4452. LANDTRADE alleged that it is the owner of a portion of
the subject parcels of land, measuring 270,255 square meters
or about 27.03 hectares, which it purportedly acquired through
a Deed of Absolute Sale dated October 1, 1996 from Teofilo,
represented by Atty. Cabildo. LANDTRADE essentially argued
that Vidal's right as heir should be adjudicated upon in a
separate and independent proceeding and not in the instant
Quieting of Title Case.
During the pre-trial conference, the parties manifested
that there was no possibility of any amicable settlement
among them.
Vidal and AZIMUTH submitted testimonial and
documentary evidence during the trial before the RTC-Branch
3. Teofilo and Atty. Cabildo failed to present any evidence as
they did not appear at all during the trial, while LANDTRADE
was declared by the RTC-Branch 3 to have waived its right to
present evidence on its defense and counterclaim.
 no valid right to or interest in the
On July 17, 2004, the RTC-Branch 3 rendered its Subject Property.
Decision[33] in Civil Case No. 4452 in favor of Vidal and
AZIMUTH, the dispositive portion of which reads: 2) ORDERING:

WHEREFORE, judgment is hereby a.) Respondent Register of

rendered in favor of the petitioners and against Deeds of Iligan City, and any
the respondents and intervenors: other person acting in his behalf,
stop, cease and desist:
1) DECLARING:
i) From accepting
a.) Petitioner Demetria C. Vidal or registering any
the sole surviving heir of the late affidavit of self-
Doa Demetria Cacho; adjudication or
b.) Petitioner Demetria C. Vidal any other
alone has the hereditary right to document
and interest in the Subject executed by
Property; respondents
c.) Petitioner Azimuth Teofilo Cacho,
International Development Godofredo
Corporation is the successor-in- Cabildo and/or
interest of petitioner Demetria C. any other person
Vidal to a portion of the Subject which in any way
Property to the extent provided in transfers the title
their 2 April 1998 Memorandum to the Subject
of Agreement and 13 August Property from
1998 Deed of Conditional Dona Demetria
Conveyance; Cacho to
d.) Respondent Teofilo Cacho is respondent
not a son or heir of the late Dona Teofilo Cacho,
Demetria Cacho; and Godofredo
e.) Respondent Teofilo Cacho, Cabildo and/or
Godofredo Cabildo and any of any of their
their transferees/assignees have transferees/assign
 ees, including the registered therein,
intervenors. any affidavit of
ii) From cancelling self-adjudication
the OCTs or any or any other
certificate of title document which
over the Subject in any way
Property in the transfers title to
name of Demetria the Subject
Cacho or any Property from
successor Demetria Cacho
certificate of title, to respondents
and from issuing Teofilo Cacho,
new certificates of Godofredo
title in the name of Cabildo and/or
respondents any of their
Teofilo Cacho, transferees/assign
Godofredo ees, including the
Cabildo their intervenors.
transferees/assign ii) From canceling
ees, including the or causing the
intervenors. cancellation of
OCTs or any
b) Respondents Teofilo Cacho, certificate of title
Godofredo Cabildo, their over the Subject
transferees/assignees, and any Property in the
other person acting in their name of Demetria
behalf, to stop, cease and desist: Cacho or any
successor
i) From executing, certificate of title,
submitting to any and from issuing
Register of new certificates of
Deeds, or title in the name of
registering or respondent
causing to be Teofilo Cacho,
 Godofredo For lack of factual and legal basis, the
Cabildo and/or counterclaim of Teofilo Cacho and Atty.
any of their Godofredo Cabildo is hereby dismissed.
transferees/assign
ees, including the Likewise, the counterclaim of intervenor
intervenors. IDD/Investa is dismissed for lack of basis as the
iii) From claiming petitioners succeeded in proving their cause of
or representing in action.
any manner that
respondent On the cross-claim of intervenor
Teofilo Cacho is IDD/Investa, respondents Teofilo Cacho and
the son or heir of Atty. Godofredo Cabildo are ORDERED to pay
Demetria Cacho IDD/Investa, jointly and severally, the principal
or has rights to or sum of P5,433,036 with 15% interest per
interest in the annum.
Subject Property.
For lack of legal basis, the counterclaim
3) ORDERING respondents Teofilo of Intervenor Landtrade Realty Development
Cacho and Atty. Godofredo Cabildo to pay Corporation is dismissed.
petitioners, jointly and severally, the following:
a) For temperate damages - Likewise, Intervenor Manguera's
P 80,000.00 counterclaim is dismissed for lack of legal
b) For nominal damages - P 60,000.00 basis.[34]
c) For moral damages - P500,000.00
d) For exemplary damages -
P 500,000.00 The joint appeal filed by LANDTRADE, Teofilo, and
e) For attorney's fees (ACCRA Law)- Atty. Cabildo with the Court of Appeals was docketed as CA-
P1,000,000.00 G.R. CV No. 00456. The Court of Appeals, in its Decision[35] of
f) For Attorney's fees - P500,000.00 January 19, 2007, affirmed in toto the Decision dated July 17,
(Atty. Voltaire Rovira) 2004 of the RTC-Branch 3.
g) For litigation expenses - P300,000.00
According to the Court of Appeals, the RTC-Branch 3
did not err in resolving the issue on Vidals status, filiation, and
hereditary rights as it is determinative of the issue on
ownership of the subject properties. It was indubitable that the
RTC-Branch 3 had jurisdiction over the person of Teofilo and
juridical personality of LANDTRADE as they both filed their
Answers to the Petition for Quieting of Title thereby voluntarily
submitting themselves to the jurisdiction of said trial
court. Likewise, the Petition for Quieting of Title is in itself
within the jurisdiction of the RTC-Branch 3. Hence, where
there is jurisdiction over the person and subject matter, the
resolution of all other questions arising in the case is but an
exercise by the court of its jurisdiction.Moreover, Teofilo and
LANDTRADE were guilty of estoppel by laches for failing to
assail the jurisdiction of the RTC-Branch 3 at the first
opportunity and even actively participating in the trial of the
case and seeking affirmative reliefs.
In addition, the Court of Appeals held that the 1997
Cacho case only determined the validity and efficacy of the
Affidavit of Adjudication that Teofilo executed before the
Philippine Consulate General in the U.S.A. The decision of
this Court in the 1997 Cacho case, which had become final
and executory, did not vest upon Teofilo ownership of the
parcels of land as it merely ordered the re-issuance of a lost
duplicate certificate of title in its original form and condition.
The Court of Appeals agreed in the finding of the
RTC-Branch 3 that the evidence on record preponderantly
supports Vidals claim of being the granddaughter and sole
heiress of the late Doa Demetria. The appellate court further
adjudged that Vidal did not delay in asserting her rights over
the subject parcels of land. The prescriptive period for real
actions over immovables is 30 years. Vidals rights as Doa
Demetrias successor-in-interest accrued upon the latters
death in 1974, and only 24 years thereafter, in 1998, Vidal
already filed the present Petition for Quieting of Title. Thus,
Vidals cause of action had not yet prescribed. And, where the
action was filed within the prescriptive period provided by law,
the doctrine of laches was also inapplicable.
LANDTRADE, Teofilo, and Atty. Cabildo filed separate
Motions for Reconsideration of the January 19, 2007 Decision
of the Court of Appeals, which were denied in the July 4, 2007
Resolution[36] of the same court.
On August 24, 2007, LANDTRADE filed with this Court a
Petition for Review on Certiorari under Rule 45 of the Rules of
Court, which was docketed as G.R. No. 178779. On
September 6, 2007, Teofilo and Atty. Cabildo filed their own
Petition for Review on Certiorari under Rule 45 of the Rules of
Court, which was docketed as G.R. No. 178894.
The Ejectment or Unlawful Detainer Case
(G.R. Nos. 170505, 173355-56, and 173563-64)
Three Petitions before this Court are rooted in the
Unlawful Detainer Case instituted by LANDTRADE against
NAPOCOR and TRANSCO.
On August 9, 1952, NAPOCOR took possession of two
parcels of land in Sitio Nunucan, Overton, Fuentes, Iligan City,
denominated as Lots 2029 and 2043, consisting of 3,588
square meters (or 0.36 hectares) and 3,177 square meters (or
0.32 hectares), respectively. On Lot 2029, NAPOCOR
constructed its power sub-station, known as the Overton Sub-
station, while on Lot 2043, it built a warehouse, known as the
Agus 7 Warehouse, both for the use of its Agus 7 Hydro-
Electric Power Plant. For more than 30 years, NAPOCOR
occupied and possessed said parcels of land pursuant to its
charter, Republic Act No. 6395.[37] With the enactment in 2001
of Republic Act No. 9136, otherwise known as the Electric
Power Industry Reform Act (EPIRA), TRANSCO assumed the
functions of NAPOCOR with regard to electrical transmissions
and took over possession of the Overton Sub-station.
Claiming ownership of the parcels of land where the
Overton Sub-station and Agus 7 Warehouse are located,
LANDTRADE filed with the MTCC on April 9, 2003 a
Complaint for Unlawful Detainer against NAPOCOR and
TRANSCO, which was docketed as Civil Case No. 11475-AF.
In its Complaint, LANDTRADE alleged that it acquired
from Teofilo, through Atty. Cabildo, two parcels of land at Sitio
Nunucan, Overton, Fuentes, Brgy. Maria Cristina, Iligan City,
with a combined area of 270,255 square meters or around
27.03 hectares, as evidenced by a Deed of Absolute
Sale[38] dated October 1, 1996. Certain portions of said parcels
of land were being occupied by the Overton Sub-station and
Agus 7 Warehouse of NAPOCOR and TRANSCO, through the
tolerance of LANDTRADE. Upon failure of NAPOCOR and
TRANSCO to pay rentals or to vacate the subject properties
after demands to do so, LANDTRADE filed the present
Complaint for Unlawful Detainer, plus damages in the amount
of P450,000.00 as yearly rental from date of the first extra-
judicial demand until NAPOCOR and TRANSCO vacate the
subject properties.
In their separate Answers, NAPOCOR and TRANSCO
denied the material allegations in the Complaint and
countered, by way of special and affirmative defenses, that the
Complaint was barred by res judicata; that the MTCC has no
jurisdiction over the subject matter of the action; and that
LANDTRADE lacked the legal capacity to sue.
On February 17, 2004, the MTCC rendered its
Decision[39] in favor of LANDTRADE. The MTCC disposed:
WHEREFORE, premises considered, judgment
is hereby rendered in favor of Plaintiff Land
Trade Realty Corporation represented by Atty.
Max C. Tabimina and against defendant
National Power Corporation represented by its
President, Mr. Rogelio M. Murga and co-
defendant TRANSCO represented by its
President Dr. Allan T. Ortiz and Engr. Lorrymir
A. Adaza, Manager, NAPOCOR-Mindanao,
Regional Center, Ma. Cristina, Iligan City,
ordering:
1. Defendants National Power
Corporation and TRANSCO, their agents or
representatives or any person/s acting on its
behalf or under its authority to vacate the
premises;
2. Defendants NAPOCOR and
TRANSCO to pay Plaintiff jointly and solidarily:
a. Php500,000.00 a month representing
fair rental value or compensation since
June 29, 1978 until defendant shall have
vacated the premises;
b. Php20,000.00 for and as attorneys
fees and
c. Cost of suit.
Execution shall issue immediately upon
motion, unless an appeal has been perfected
 and the defendant to stay execution files a
sufficient supersedeas bond, approved by this
Court and executed in favor of the plaintiff, to
pay the rents, damages, and costs accruing
down to the time of judgment appealed from,
and unless, during the pendency of the appeal,
defendants deposit with the appellate court the
amount of P500,000.00 per month, as
reasonable value of the use and occupancy of
the premises for the preceding month or period
on or before the tenth day of each succeeding
month or period.[40]
NAPOCOR and TRANSCO seasonably filed a Joint
Notice of Appeal. Their appeal, docketed as Civil Case No.
6613, was initially assigned to the RTC-Branch 5, presided
over by Judge Maximino Magno Libre (Judge Libre).
LANDTRADE filed on June 24, 2004 a Motion for
Execution, asserting that NAPOCOR and TRANSCO had
neither filed a supersedeas bond with the MTCC nor
periodically deposited with the RTC the monthly rental for the
properties in question, so as to stay the immediate execution
pending appeal of the MTCC judgment. However, the said
Motion failed to comply with the required notice of hearing
under Rule 15, Section 5 of the Rules of Court.LANDTRADE
then filed a Motion to Withdraw and/or Replace Notice of
Hearing.
NAPOCOR and TRANSCO filed on July 13, 2004 a
Joint Motion to Suspend Proceedings citing Amagan v.
Marayag,[41] in which the Court ruled that if circumstances
should require, the proceedings in an ejectment case may be
suspended in whatever stage it may be found. Since
LANDTRADE anchors its right to possession of the subject
parcels of land on the Deed of Sale executed in its favor by
Teofilo on October 1, 1996, the ejectment case should be held
in abeyance pending the resolution of other cases in which title
over the same properties are in issue, i.e., (1) Civil Case No.
6600, the action for the annulment of the Deed of Sale dated
October 1, 1996 filed by Teofilo against LANDTRADE pending
before the RTC-Branch 4; and (2) Civil Case No. 4452, the
Quieting of Title Case filed by Vidal and AZIMUTH against
Teofilo and Atty. Cabildo pending before the RTC-Branch 3.
LANDTRADE filed on July 19, 2004 another Motion for
Execution, which was heard together with the Joint Motion to
Suspend Proceedings of NAPOCOR and TRANSCO. After
said hearing, the RTC-Branch 5 directed the parties to file their
memoranda on the two pending Motions.
LANDTRADE, in its Memorandum, maintained that the
pendency of Civil Case No. 4452, the Quieting of Title Case,
should not preclude the execution of the MTCC judgment in
the Unlawful Detainer Case because the issue involved in the
latter was only the material possession or possession de
facto of the parcels of land in question. LANDTRADE also
reported that Civil Case No. 6600, the action for annulment of
the Deed of Sale dated October 1, 1996 instituted by Teofilo,
was already dismissed given that the RTC-Branch 4 had
approved the Compromise Agreement executed between
LANDTRADE and Teofilo.
NAPOCOR and TRANSCO likewise filed their respective
Memoranda. Subsequently, NAPOCOR filed a Supplement to
its Memorandum to bring to the attention of the RTC-Branch 5
the Decision rendered on July 17, 2004 by the RTC-Branch 3
in Civil Case No. 4452, the Quieting of Title Case,
categorically declaring Teofilo, the predecessor-in-interest of
LANDTRADE, as having no right at all to the subject parcels of
land. Resultantly, the right of LANDTRADE to the two
properties, which merely emanated from Teofilo, was
effectively declared as non-existent too.
On August 4, 2004, the RTC-Branch 5 issued an
Order[42] denying the Joint Motion to Suspend Proceedings of
NAPOCOR and TRANSCO. The RTC held that the pendency
of other actions involving the same parcels of land could not
stay execution pending appeal of the MTCC judgment
because NAPOCOR and TRANSCO failed to post the required
bond and pay the monthly rentals.
Five days later, on August 9, 2004, the RTC-Branch 5
issued another Order[43] granting the Motion of LANDTRADE
for execution of the MTCC judgment pending appeal.
The next day, on August 10, 2004, the Acting Clerk of
Court, Atty. Joel M. Macaraya, Jr., issued a Writ of Execution
Pending Appeal[44] which directed Sheriff IV Alberto O. Borres
(Sheriff Borres) to execute the MTCC Decision dated February
17, 2004.
A day later, on August 11, 2004, Sheriff Borres issued two
Notices of Garnishment[45] addressed to PNB and Land Bank
of the Philippines in Iligan City, garnishing all the goods,
effects, stocks, interests in stocks and shares, and any other
personal properties belonging to NAPOCOR and TRANSCO
which were being held by and under the possession and
control of said banks. On even date, Sheriff Borres also issued
a Notification[46] to NAPOCOR and TRANSCO for them to
vacate the subject parcels of land; and to pay LANDTRADE
the sums of (a) P156,000,000.00, representing the total fair
rental value for the said properties, computed at P500,000.00
per month, beginning June 29, 1978 until June 29, 2004, or for
a period of 26 years, and (b) P20,000.00 as attorney's fees.
Thereafter, NAPOCOR and TRANSCO each filed before the
Court of Appeals in Cagayan de Oro City a Petition
for Certiorari, under Rule 65 of the Rules of Court, with prayer
for the issuance of a TRO and writ of preliminary
injunction. The Petitions, docketed as CA-G.R. SP Nos. 85174
and 85841, were eventually consolidated.
The Court of Appeals issued on August 18, 2004 a
TRO[47] enjoining the enforcement and implementation of the
Order of Execution and Writ of Execution Pending Appeal of
the RTC-Branch 5 and Notices of Garnishment and
Notification of Sheriff Borres.
The Court of Appeals, in its Decision[48] dated
November 23, 2005, determined that public respondents did
commit grave abuse of discretion in allowing and/or effecting
the execution of the MTCC judgment pending appeal, since
NAPOCOR and TRANSCO were legally excused from
complying with the requirements for a stay of execution
specified in Rule 70, Section 19 of the Rules of Court,
particularly, the posting of a supersedeas bond and periodic
deposits of rental payments. The decretal portion of said
appellate court Decision states:
ACCORDINGLY, the two petitions at
bench are GRANTED; the Order dated 9
August 2004, the Writ of Execution Pending
Appeal dated 10 August 2004, the two Notices
of Garnishment dated 11 August 2004, and the
 Notification dated 11 August 2004, are
ANNULLED and SET ASIDE.[49]
Displeased, LANDTRADE elevated the case to this
Court on January 10, 2006 via a Petition for Review
on Certiorari under Rule 45 of the Rules of Court, which was
docketed as G.R. No. 170505.
In the meantime, with the retirement of Judge Libre and
the inhibition[50] of Judge Oscar Badelles, the new presiding
judge of RTC-Branch 5, Civil Case No. 6613 was re-raffled to
the RTC-Branch 1, presided over by Judge Mangotara. The
RTC-Branch 1 promulgated on December 12, 2005 a
Decision[51]in Civil Case No. 6613 which affirmed in toto the
February 17, 2004 Decision of the MTCC in Civil Case No.
11475-AF favoring LANDTRADE.
NAPOCOR and TRANSCO filed with the RTC-Branch 1 twin
Motions, namely: (1) Motion for Reconsideration of the
Decision dated December 12, 2005; and (2) Motion for
Inhibition of Judge Mangotara. The RTC-Branch 1 denied both
Motions in a Resolution dated January 30, 2006.
NAPOCOR and TRANSCO filed with the Court of
Appeals separate Petitions for Review with prayer for TRO
and/or a writ of preliminary injunction, which were docketed as
CA-G.R. SP Nos. 00854 and 00889, respectively. In a
Resolution dated March 24, 2006, the Court of Appeals
granted the prayer for TRO of NAPOCOR and TRANSCO.
With the impending lapse of the effectivity of the TRO on May
23, 2006, NAPOCOR filed on May 15, 2006 with the Court of
Appeals a Manifestation and Motion praying for the resolution
of its application for preliminary injunction.
On May 23, 2006, the same day the TRO lapsed, the Court of
Appeals granted the motions for extension of time to file a
consolidated comment of LANDTRADE. Two days later,
LANDTRADE filed an Omnibus Motion seeking the issuance
of (1) a writ of execution pending appeal, and (2) the
designation of a special sheriff in accordance with Rule 70,
Section 21 of the Rules of Court.
In a Resolution[52] dated June 30, 2006, the Court of Appeals
granted the Omnibus Motion of LANDTRADE and denied the
applications for the issuance of a writ of preliminary injunction
of NAPOCOR and TRANSCO. In effect, the appellate court
authorized the execution pending appeal of the judgment of
the MTCC, affirmed by the RTC-Branch 1, thus:
IN LIGHT OF THE ABOVE
DISQUISITIONS, this Court resolves to grant
the [LANDRADE]s omnibus motion for
execution pending appeal of the decision
rendered in its favor which is being assailed in
these consolidated petitions for
review. Accordingly, the [NAPOCOR and
TRANSCOs] respective applications for
issuance of writ of preliminary injunction are
both denied for lack of factual and legal
bases. The Municipal Trial Court in Cities,
Branch 2, Iligan City, which at present has the
custody of the records of the case a quo, is
hereby ordered to cause the immediate
issuance of a writ of execution relative to its
 decision dated 17 February 2004 in Civil Case
No. 11475-AF.[53]
On July 20, 2006, NAPOCOR filed with this Court a
Petition for Certiorari and Prohibition under Rule 65 of the
Rules of Court with an urgent plea for a TRO, docketed as
G.R. No. 173355-56. On August 2, 2006, TRANSCO filed with
this Court its own Petition for Certiorari, docketed as G.R. No.
173563-64.
On July 21, 2006, NAPOCOR filed an Urgent Motion
for the Issuance of a TRO in G.R. No. 173355-56. In a
Resolution[54] dated July 26, 2006, the Court granted the
Motion of NAPOCOR and issued a TRO,[55] effective
immediately, which enjoined public and private respondents
from implementing the Resolution dated June 30, 2006 of the
Court of Appeals in CA-G.R. SP Nos. 00854 and 00889 and
the Decision dated February 17, 2004 of the MTCC in Civil
Case No. 11475-AF.
On July 31, 2006, Vidal and AZIMUTH filed a Motion for Leave
to Intervene and to Admit Attached Comment-in-Intervention,
contending therein that Vidal was the lawful owner of the
parcels of land subject of the Unlawful Detainer Case as
confirmed in the Decision dated July 17, 2004 of the RTC-
Branch 3 in Civil Case No. 4452. In a Resolution dated
September 30, 2006, the Court required the parties to
comment on the Motion of Vidal and AZIMUTH, and deferred
action on the said Motion pending the submission of such
comments.
The Cancellation of Titles and Reversion Case
(G.R. No. 173401)
On October 13, 2004, the Republic filed a Complaint
for the Cancellation of OCT Nos. 0-1200 (a.f.) and 0-1201
(a.f.) and Reversion against the late Doa Demetria,
represented by her alleged heirs, Vidal and/or Teofilo, together
with AZIMUTH and LANDTRADE. The Complaint, docketed as
Civil Case No. 6686, was raffled to the RTC-Branch 4.
The Republic sought the cancellation of OCT Nos. 0-
1200 (a.f.) and 0-1201 (a.f.) and the reversion of the parcels of
land covered thereby to the Government based on the
following allegations in its Complaint, under the heading
Cause of Action:
5. On October 15, 1998, Original
Certificates of Title (OCTs) Nos. 0-1200 (a.f.)
and 0-1201 (a.f.) were issued in the name of
Demetria Cacho, widow, now deceased
consisting of a total area of Three Hundred
Seventy-Eight Thousand Seven Hundred and
Seven (378,707) square meters and Three
Thousand Seven Hundred Thirty-Five (3,635)
square meters, respectively, situated in Iligan
City, x x x
xxxx
6. The afore-stated titles were issued in
implementation of a decision rendered in LRC
(GLRO) Record Nos. 6908 and 6909 dated
December 10, 1912, as affirmed by the
Honorable Supreme Court in Cacho v.
Government of the United States, 28 Phil. 616
(December 10, 1914),
 7. The decision in LRC (GLRO) Record
Nos. 6908 and 6909, upon which the titles were
issued, did not grant the entire area applied for
therein. x x x
xxxx
9. As events turned out, the titles issued
in connection with LRC (GLRO) Record Nos.
6908 and 6909 i.e. OCT Nos. 0-1200 (a.f.) and
0-1201 (a.f.) cover property MUCH LARGER in
area than that granted by the land registration
court in its corresponding decision, supra.
10. While the LRC Decision, as affirmed
by the Honorable Supreme Court, granted only
the southern part of the 37.87 hectare land
subject of LRC (GLRO) Record Case No.
6909, the ENTIRE 37.87 hectares is indicated
as the property covered by OCT 0-1200
(a.f.). Worse, OCT No. 0-1200 (a.f.) made
reference to Case No. 6908 as basis thereof,
yet, the decision in said case is clear:
(i) The parcel object of
Case No. 6908 is
small (Cacho vs.
Government of the United
States, 28 Phil. 616, p.
619)
(ii) The parcel of land
claimed by the applicant
in Case No. 6909 is the
bigger of two parcels and
contains 37.87 hectares
11. More significantly, the technical
description in Original Certificate of Title No. 0-
1200 (a.f.) specifies the date of survey as
August 31 to September 1, 1910, which is
EARLIER than the date the Supreme Court,
in Cacho supra, resolved LRC (GLRO) Record
No. 6909 (involving 37.87 hectares). In
resolving the application involving the 37.87
hectares, the Honorable Supreme Court
declared that only the southern part of the
37.87 hectare property applied for is granted
and that a new survey specifying the southern
part thereof should be submitted. Accordingly,
any survey involving the granted southern part
should bear a date subsequent to the
December 10, 1914 Supreme Court decision. x
xx
xxxx
12. The Honorable Supreme Court
further declared that the Decision in LRC
(GLRO) Record No. 6909 was reserved:
Final decision in these case
is reserved until the presentation
of the new plan. (28 Phil. 616, p.
631; Underscoring supplied)
In other words, as of December 10, 1914, when
the Honorable Supreme Court rendered its
Decision on appeal in LRC (GLRO) Record No.
6909, final decision of the case was still
reserved until the presentation of a new
plan. The metes and bounds of OCT No. 0-
1200 (a.f.) could not have been the technical
description of the property granted by the court
described as the southern part of the large
parcel object of expediente 6909 only (Cacho
vs. Government of the United States, 28 Phil.
617, 629).As earlier stated, the technical
description appearing in said title was the result
of a survey conducted in 1910 or before the
Supreme Court decision was rendered in 1914.
13. In the same vein, Original Certificate of Title
No. 0-1201 (a.f.) specifies LRC (GLRO) Record
No. 6909 as the basis thereof (see front page of
OCT No. 0-1201 (a.f.)).Yet, the technical
description makes, as its reference, Lot 1, Plan
II-3732, LR Case No. 047, LRC (GLRO)
Record No. 6908 (see page 2 of said title). A
title issued pursuant to a decision may only
cover the property subject of the case. A title
cannot properly be issued pursuant to a
decision in Case 6909, but whose technical
description is based on Case 6908.
14. The decision in LRC (GLRO) Record Nos.
6908 and 6909 has become final and
executory, and it cannot be modified, much less
result in an increased area of the property
decreed therein.
xxxx
16. In sum, Original Certificates of Title Nos. 0-
1200 (a.f.) and 0-1201 (a.f.), as issued, are null
and void since the technical descriptions vis--vis
the areas of the parcels of land covered therein
went beyond the areas granted by the land
registration court in LRC (GLRO) Record Nos.
6908 and 6909.[56]
Vidal and AZIMUTH filed a Motion to Dismiss dated
December 23, 2004 on the grounds that (1) the Republic
has no cause of action; (2) assuming arguendo that the
Republic has a cause of action, its Complaint failed to state
a cause of action; (3) assuming arguendo that the Republic
has a cause of action, the same is barred by prior judgment;
(4) assuming further that the Republic has a cause of
action, the same was extinguished by prescription; and (4)
the Republic is guilty of forum shopping.
Upon motion of the Republic, the RTC-Branch 4
issued an Order[57] dated October 4, 2005, declaring
LANDTRADE and Teofilo, as represented by Atty. Cabildo,
in default since they failed to submit their respective
answers to the Complaint despite the proper service of
summons upon them.
LANDTRADE subsequently filed its Answer with
Compulsory Counterclaim dated September 28, 2005. It
also moved for the setting aside and reconsideration of the
Order of Default issued against it by the RTC-Branch 4 on
October 20, 2005.
On December 13, 2005, the RTC-Branch 4 issued
an Order[58] dismissing the Complaint of the Republic in Civil
Case No. 6686, completely agreeing with Vidal and
AZIMUTH.
The RTC-Branch 4 reasoned that the Republic had
no cause of action because there was no showing that the
late Doa Demetria committed any wrongful act or omission
in violation of any right of the Republic. Doa Demetria had
sufficiently proven her ownership over the parcels of land as
borne in the ruling of the LRC in GLRO Record Nos. 6908
and 6909. On the other hand, the Republic had no more
right to the said parcels of land. The Regalian doctrine does
not apply in this case because the titles were already issued
to Doa Demetria and segregated from the mass of the
public domain.
The RTC-Branch 4 likewise held that the Republic
failed to state a cause of action in its Complaint. The
arguments of the Republic i.e., the absence of a new survey
plan and deed, the titles covered properties with much
larger area than that granted by the LRC had been
answered squarely in the 1997 Cacho case. Also, the
Complaint failed to allege that fraud had been committed in
having the titles registered and that the Director of Lands
requested the reversion of the subject parcels of land.
The RTC-Branch 4 was convinced that the
Complaint was barred by res judicata because the 1914
Cacho case already decreed the registration of the parcels
of land in the late Doa Demetrias name and the 1997
Cacho case settled that there was no merit in the argument
that the conditions imposed in the first case have not been
complied with.
The RTC-Branch 4 was likewise persuaded that the
cause of action or remedy of the Republic was lost or
extinguished by prescription pursuant to Article 1106 of the
Civil Code and Section 32 of Presidential Decree No. 1529,
otherwise known as the Land Registration Decree, which
prescribes a one-year period within which to file an action
for the review of a decree of registration.
Finally, the RTC-Branch 4 found the Republic guilty
of forum shopping because there is between this case, on
one hand, and the 1914 and 1997 Cacho cases, on the
other, identity of parties, as well as rights asserted and
reliefs prayed for, as the contending parties are claiming
rights of ownership over the same parcels of land.
The Republic filed a Motion for Reconsideration of
the dismissal of its Complaint but the same was denied by
the RTC-Branch 4 in its Order[59]dated May 16, 2006.
Assailing the Orders dated December 13, 2005 and
May 16, 2006 of the RTC-Branch 4, the Republic filed on
August 11, 2006 a Petition for Review on Certiorari under Rule
45 of the Rules of Court, which was docketed as G.R. No.
173401.
III
ISSUES AND DISCUSSIONS
Expropriation Case
(G.R. No. 170375)
The Republic, in its consolidated Petitions challenging
the Resolutions dated July 12, 2005 and October 24, 2005 of
the RTC-Branch 1 in Civil Case No. 106, made the following
assignment of errors:
RESPONDENT JUDGE GRAVELY ERRED IN Filing of
ORDERING THE DISMISSAL OF THE consolidated
EXPROPRIATION COMPLAINT IN CIVIL petitions under
CASE NO. 106 CONSIDERING THAT: both Rules 45
and 65
(a) THE NON-JOINDER OF
PARTIES IS NOT A GROUND
FOR THE DISMISSAL OF AN At the outset, the Court notes that the Republic filed a pleading
ACTION PURSUANT TO with the caption Consolidated Petitions for Review on
SECTION 11, RULE 3 OF THE Certiorari (Under Rule 45) and Certiorari (Under Rule 65) of
1997 RULES OF CIVIL the Rules of Court. The Republic explains that it filed the
PROCEDURE; Consolidated Petitions pursuant to Metropolitan Waterworks
and Sewerage System (MWSS) v. Court of Appeals[61] (MWSS
(b) AN EXPROPRIATION case).
PROCEEDING IS AN ACTION
QUASI IN REM WHEREIN THE The reliance of the Republic on the MWSS case to justify its
FACT THAT THE OWNER OF mode of appeal is misplaced, taking the pronouncements of
THE PROPERTY IS MADE A this Court in said case out of context.
PARTY TO THE ACTION IS
NOT ESSENTIALLY The issue in the MWSS case was whether a possessor in
INDISPENSABLE; good faith has the right to remove useful improvements, and
not whether consolidated petitions under both Rules 45 and 65
(c) PETITIONER DID NOT of the Rules of Court can be filed. Therein petitioner MWSS
COMMIT ANY FORUM simply filed an appeal by certiorari under Rule 45 of the Rules
SHOPPING WITH THE FILING of Court, but named the Court of Appeals as a
OF THE REVERSION respondent. The Court clarified that the only parties in an
COMPLAINT DOCKETED AS appeal by certiorari under Rule 45 of the Rules of Court are
CIVIL CASE NO. 6686 WHICH the appellant as petitioner and the appellee as
IS PENDING BEFORE BRANCH respondent. The court which rendered the judgment appealed
4 OF from is not a party in said appeal. It is in the special civil action
THE REGIONAL TRIAL COURT of certiorari under Rule 65 of the Rules of Court where the
OF ILIGAN CITY.[60] court or judge is required to be joined as party defendant or
respondent. The Court, however, also acknowledged that
there may be an instance when in an appeal
by certiorari under Rule 45, the petitioner-appellant would also
claim that the court that rendered the appealed judgment
acted without or in excess of its jurisdiction or with grave
abuse of discretion, in which case, such court should be joined
as a party-defendant or respondent. While the Court may have
stated that in such an instance, the petition for review
on certiorari under Rule 45 of the Rules of Court is at the same
time a petition for certiorari under Rule 65, the Court did not
hold that consolidated petitions under both Rules 45 and 65
could or should be filed.
The Court, in more recent cases, had been stricter and
clearer on the distinction between these two modes of
appeal. In Nunez v. GSIS Family Bank,[62]the Court elucidated:
In Ligon v. Court of Appeals where the
therein petitioner described her petition as an
appeal under Rule 45 and at the same time as
a special civil action of certiorari under Rule 65
of the Rules of Court, this Court, in frowning
over what it described as a chimera, reiterated
that the remedies of appeal and certiorari are
mutually exclusive and not alternative nor
successive.
To be sure, the distinctions between
Rules 45 and 65 are far and wide. However, the
most apparent is that errors of jurisdiction are
best reviewed in a special civil action for
certiorari under Rule 65 while errors of
judgment can only be corrected by appeal in a
petition for review under Rule 45.
But in the same case, the Court also held that:
This Court, x x x, in accordance with the
liberal spirit which pervades the Rules of Court
and in the interest of justice may treat a petition
for certiorari as having been filed under Rule
45, more so if the same was filed within the
reglementary period for filing a petition for
review.[63]
It is apparent in the case at bar that the Republic
availed itself of the wrong mode of appeal by filing
Consolidated Petitions for Review under Rule 45 and
for Certiorari under Rule 65, when these are two separate
remedies that are mutually exclusive and neither alternative
nor successive. Nevertheless, the Court shall treat the
Consolidated Petitions as a Petition for Review
on Certiorari under Rule 45 and the allegations therein as
errors of judgment. As the records show, the Petition was filed
on time under Rules 45. Before the lapse of the 15-day
reglementary period to appeal under Rule 45, the Republic
filed with the Court a motion for extension of time to file its
petition. The Court, in a Resolution[64] dated January 23, 2006,
granted the Republic a 30-day extension, which was to expire
on December 29, 2005. The Republic was able to file its
Petition on the last day of the extension period.
Hierarchy of courts
The direct filing of the instant Petition with this Court
did not violate the doctrine of hierarchy of courts.
According to Rule 41, Section 2(c)[65] of the Rules of Court, a
decision or order of the RTC may be appealed to the Supreme
Court by petition for review on certiorari under Rule 45,
provided that such petition raises only questions of law.[66]
A question of law exists when the doubt or controversy
concerns the correct application of law or jurisprudence to a
certain set of facts; or when the issue does not call for an
examination of the probative value of the evidence presented,
the truth or falsehood of facts being admitted.[67] A question of
fact exists when the doubt or difference arises as to the truth
or falsehood of facts or when the query invites calibration of
the whole evidence considering mainly the credibility of the
witnesses, the existence and relevancy of specific surrounding
circumstances, as well as their relation to each other and to
the whole, and the probability of the situation.[68]
Here, the Petition of the Republic raises pure questions
of law, i.e., whether Civil Case No. 106 should have been
dismissed for failure to implead indispensable parties and for
forum shopping. Thus, the direct resort by the Republic to this
Court is proper.
The Court shall now consider the propriety of the
dismissal by the RTC-Branch 1 of the Complaint for
Expropriation of the Republic.
The proper
parties in the
expropriation
proceedings
The right of the Republic to be substituted for ISA as
plaintiff in Civil Case No. 106 had long been affirmed by no
less than this Court in the ISA case.The dispositive portion of
the ISA case reads:
WHEREFORE, for all the foregoing, the
Decision of the Court of Appeals dated 8
October 1991 to the extent that it affirmed the
trial courts order dismissing the expropriation
proceedings, is hereby REVERSED and SET
ASIDE and the case is REMANDED to the
court a quo which shall allow the substitution of
the Republic of the Philippines for petitioner Iron
Steel Authority for further proceedings
consistent with this Decision. No
pronouncement as to costs.[69]
The ISA case had already become final and executory,
and entry of judgment was made in said case on August 31,
1998. The RTC-Branch 1, in an Order dated November 16,
2001, effected the substitution of the Republic for ISA.
The failure of the Republic to actually file a motion for
execution does not render the substitution void. A writ of
execution requires the sheriff or other proper officer to whom it
is directed to enforce the terms of the writ.[70] The November
16, 2001 Order of the RTC-Branch 1 should be deemed as
voluntary compliance with a final and executory judgment of
this Court, already rendering a motion for and issuance of a
writ of execution superfluous.
Besides, no substantive right was violated by the
voluntary compliance by the RTC-Branch 1 with the directive
in the ISA case even without a motion for execution having
been filed. To the contrary, the RTC-Branch 1 merely enforced
the judicially determined right of the Republic to the
substitution. While it is desirable that the Rules of Court be
faithfully and even meticulously observed, courts should not be
so strict about procedural lapses that do not really impair the
administration of justice. If the rules are intended to insure the
orderly conduct of litigation it is because of the higher objective
they seek which is the protection of the substantive rights of
the parties.[71]
The Court also observes that MCFC did not seek any
remedy from the Order dated November 16, 2001 of the RTC-
Branch 1. Consequently, the said Order already became final,
which even the RTC-Branch 1 itself cannot reverse and set
aside on the ground of honest mistake.
The RTC-Branch 1 dismissed the Complaint in Civil
Case No. 106 on another ground: that MCFC is not a proper
party to the expropriation proceedings, not being the owner of
the parcels of land sought to be expropriated. The RTC-
Branch 1 ratiocinated that since the exercise of the power of
eminent domain involves the taking of private land intended for
public use upon payment of just compensation to the owner,
then a complaint for expropriation must be directed against the
owner of the land sought to be expropriated.
The Republic insists, however, that MCFC is a real
party-in-interest, impleaded as a defendant in the Complaint
for Expropriation because of its possessory or occupancy
rights over the subject parcels of land, and not by reason of its
ownership of the said properties. In addition, the Republic
maintains that non-joinder of parties is not a ground for the
dismissal of an action.
Rule 67, Section 1 of the then Rules of
Court[72] described how expropriation proceedings should be
instituted:
Section 1. The complaint. The right of
eminent domain shall be exercised by the filing
of a complaint which shall state with certainty
the right and purpose of condemnation,
describe the real or personal property sought to
be condemned, and join as defendants all
persons owning or claiming to own, or
occupying, any part thereof or interest
therein, showing, so far as practicable, the
interest of each defendant separately. If the
title to any property sought to be
condemned appears to be in the Republic of
the Philippines, although occupied by
private individuals, or if the title is otherwise
obscure or doubtful so that the plaintiff cannot
with accuracy or certainty specify who are the
real owners, averment to that effect may be
made in the complaint.[73] (Emphases supplied.)
For sure, defendants in an expropriation case are not limited to
the owners of the property to be expropriated, and just
compensation is not due to the property owner alone. As this
Court held in De Knecht v. Court of Appeals[74]:
The defendants in an expropriation
case are not limited to the owners of the
property condemned. They include all other
persons owning, occupying or claiming to
own the property. When [property] is taken
by eminent domain, the owner x x x is not
 necessarily the only person who is entitled
to compensation. In the American jurisdiction,
the term owner when employed in statutes
relating to eminent domain to designate the
persons who are to be made parties to the
proceeding, refer, as is the rule in respect of
those entitled to compensation, to all those who
have lawful interest in the property to be
condemned, including a mortgagee, a lessee
and a vendee in possession under an executory
contract. Every person having an estate or
interest at law or in equity in the land taken is
entitled to share in the award. If a person
claiming an interest in the land sought to be
condemned is not made a party, he is given the
right to intervene and lay claim to the
compensation. (Emphasis supplied.)
At the time of the filing of the Complaint for Expropriation in
1983, possessory/occupancy rights of MCFC over the parcels
of land sought to be expropriated were undisputed. In fact,
Letter of Instructions No. 1277[75] dated November 16, 1982
expressly recognized that portions of the lands reserved by
Presidential Proclamation No. 2239, also dated November 16,
1982, for the use and immediate occupation by the NSC, were
then occupied by an idle fertilizer plant/factory and related
facilities of MCFC. It was ordered in the same Letter of
Instruction that:
(1) NSC shall negotiate with the owners
of MCFC, for and on behalf of the Government,
for the compensation of MCFC's
present occupancy rights on the subject lands
at an amount of Thirty (P30.00) Pesos per
square meter or equivalent to the assessed
value thereof (as determined by the City
Assessor of Iligan), whichever is higher. NSC
shall give MCFC the option to either remove its
aforesaid plant, structures, equipment,
machinery and other facilities from the lands or
to sell or cede ownership thereof to NSC at a
price equivalent to the fair market value thereof
as appraised by the Asian Appraisal Inc. as
may be mutually agreed upon by NSC and
MCFC.
(2) In the event that NSC and MCFC fail
to agree on the foregoing within sixty (60) days
from the date hereof, the Iron and Steel
Authority (ISA) shall exercise its authority under
Presidential Decree (PD) No. 272, as amended,
to initiate the expropriation of the
aforementioned occupancy rights of MCFC on
the subject lands as well as the plant,
structures, equipment, machinery and related
facilities, for and on behalf of NSC, and
thereafter cede the same to NSC. During the
pendency of the expropriation proceedings,
NSC shall take possession of the properties,
subject to bonding and other requirements of
P.D. 1533. (Emphasis supplied.)
Being the occupant of the parcel of land sought to be
expropriated, MCFC could very well be named a defendant in
Civil Case No. 106. The RTC-Branch 1 evidently erred in
dismissing the Complaint for Expropriation against MCFC for
not being a proper party.
Also erroneous was the dismissal by the RTC-Branch 1 of the
original Complaint for Expropriation for having been filed only
against MCFC, the occupant of the subject land, but not the
owner/s of the said property.
Dismissal is not the remedy for misjoinder or non-joinder of
parties. According to Rule 3, Section 11 of the Rules of Court:
SEC. 11. Misjoinder and non-joinder of
parties. Neither misjoinder nor non-joinder of
parties is ground for dismissal of an
action. Parties may be dropped or added by
order of the court on motion of any party or on
its own initiative at any stage of the action and
on such terms as are just. Any claim against a
misjoined party may be severed and proceeded
with separately. (Emphasis supplied.)
MCFC contends that the aforequoted rule does not apply in
this case where the party not joined, i.e., the owner of the
property to be expropriated, is an indispensable party.
An indispensable party is a party-in-interest without whom no
final determination can be had of an action.[76]
Now, is the owner of the property an indispensable
party in an action for expropriation? Not necessarily. Going
back to Rule 67, Section 1 of the Rules of Court, expropriation
proceedings may be instituted even when title to the property
sought to be condemned appears to be in the Republic of
the Philippines, although occupied by private individuals. The
same rule provides that a complaint for expropriation shall
name as defendants all persons owning or claiming to own, or
occupying, any part thereof or interest in the property sought
to be condemned. Clearly, when the property already appears
to belong to the Republic, there is no sense in the Republic
instituting expropriation proceedings against itself. It can still,
however, file a complaint for expropriation against the private
persons occupying the property. In such an expropriation
case, the owner of the property is not an indispensable party.
To recall, Presidential Proclamation No. 2239 explicitly
states that the parcels of land reserved to NSC are part of the
public domain, hence, owned by the Republic. Letter of
Instructions No. 1277 recognized only the occupancy rights of
MCFC and directed NSC to institute expropriation proceedings
to determine the just compensation for said occupancy
rights. Therefore, the owner of the property is not an
indispensable party in the original Complaint for Expropriation
in Civil Case No. 106.
Assuming for the sake of argument that the owner of the
property is an indispensable party in the expropriation
proceedings, the non-joinder of said party would still not
warrant immediate dismissal of the complaint for
expropriation. In Vda. De Manguerra v. Risos,[77] the Court
applied Rule 3, Section 11 of the Rules of Court even in case
of non-joinder of an indispensable party, viz:
[F]ailure to implead an indispensable party is
not a ground for the dismissal of an action. In
such a case, the remedy is to implead the non-
party claimed to be indispensable. Parties may
be added by order of the court, on motion of the
 party or on its own initiative at any stage of the
action and/or such times as are just. If the
petitioner/plaintiff refuses to implead an
indispensable party despite the order of the
court, the latter may dismiss the
complaint/petition for the petitioner's/plaintiff's
failure to comply. (Emphasis supplied.)
In this case, the RTC-Branch 1 did not first require the
Republic to implead the alleged owner/s of the parcel of land
sought to be expropriated. Despite the absence of any order
from the Court, the Republic upon becoming aware that the
parcels of land involved in the 1914 Cacho case and 1997
Cacho case, claimed by Teofilo and LANDTRADE, and Vidal
and AZIMUTH, encroached into and overlapped with the
parcel of land subject of Civil Case No. 106 sought leave of
court to file a Supplemental Complaint to implead these four
parties. The RTC-Branch 1 did not take the Supplemental
Complaint of the Republic into consideration. Instead, it
dismissed outright the original Complaint for Expropriation
against MCFC.
Forum shopping
The RTC-Branch 1 further erred in finding that the Republic
committed forum shopping by (1) simultaneously instituting the
actions for expropriation (Civil Case No. 106) and reversion
(Civil Case No. 6686) for the same parcels of land; and (2)
taking inconsistent positions when it conceded lack of
ownership over the parcels of land in the expropriation case
but asserted ownership of the same properties in the reversion
case.
There is no dispute that the Republic instituted
reversion proceedings (Civil Case No. 6686) for the same
parcels of land subject of the instant Expropriation Case (Civil
Case No. 106). The Complaint for Cancellation of Titles and
Reversion[78] dated September 27, 2004 was filed by the
Republic with the RTC on October 13, 2004. The records,
however, do not show when the Supplemental Complaint for
Expropriation[79] dated September 28, 2004 was filed with the
RTC. Apparently, the Supplemental Complaint for
Expropriation was filed after the Complaint for Cancellation of
Titles and Reversion since the Republic mentioned in the
former the fact of filing of the latter.[80] Even then, the
Verification and Certification of Non-Forum
Shopping[81] attached to the Supplemental Complaint for
Expropriation did not disclose the filing of the Complaint for
Cancellation of Titles and Reversion. Notwithstanding such
non-disclosure, the Court finds that the Republic did not
commit forum shopping for filing both Complaints.
In NBI-Microsoft Corporation v Hwang,[82] the Court laid
down the circumstances when forum shopping exists:
Forum-shopping takes place when a
litigant files multiple suits involving the same
parties, either simultaneously or successively,
to secure a favorable
judgment.Thus, it exists where the elements of l
itis pendentia are present, namely: (a) identity o
f parties, or at least such parties
who represent the same interests in both
actions; (b)identity of rights asserted and relief
prayed for, the relief being founded on the
same facts; and (c) the identity with respect to
the two preceding particulars in the two cases
 is such that any judgment that may
be rendered in the pending case, regardless of
which party is
successful, would amount to res judicata in the
other case. Forum-shopping is an act of
malpractice because it abuses court processes.
x x x.
Here, the elements of litis pendencia are
wanting. There is no identity of rights asserted and reliefs
prayed for in Civil Case No. 106 and Civil Case No. 6686.
Civil Case No. 106 was instituted against MCFC to acquire, for
a public purpose, its possessory/occupancy rights over
322,532 square meters or 32.25 hectares of land which, at the
time of the filing of the original Complaint in 1983, was not yet
covered by any certificate of title. On the other hand, Civil
Case No. 6686 sought the cancellation of OCT Nos. 0-1200
(a.f.) and 0-1201 (a.f.), which was entered into registration on
December 4, 1998 in Doa Demetrias name, on the argument
that the parcels of land covered by said certificates exceeded
the areas granted by the LRC to Doa Demetria in GLRO
Record Nos. 6908 and 6909, as affirmed by this Court in
the 1914 Cacho case.
Expropriation vis--vis reversion
The Republic is not engaging in contradictions when it
instituted both expropriation and reversion proceedings for the
same parcels of land. The expropriation and reversion
proceedings are distinct remedies that are not necessarily
exclusionary of each other.
The filing of a complaint for reversion does not preclude the
institution of an action for expropriation. Even if the land is
reverted back to the State, the same may still be subject to
expropriation as against the occupants thereof.
Also, Rule 67, Section 1 of the Rules of Court allows
the filing of a complaint for expropriation even when the title to
any property sought to be condemned appears to be in the
Republic of the Philippines, although occupied by private
individuals, or if the title is otherwise obscure or doubtful so
that the plaintiff cannot with accuracy or certainty specify who
are the real owners. Rule 67, Section 9 of the Rules of Court
further provides:
SEC. 9. Uncertain ownership; conflicting
claims. If the ownership of the property taken
is uncertain, or there are conflicting claims
to any part thereof, the court may order any
sum or sums awarded as compensation for the
property to be paid to the court for the benefit of
the person adjudged in the same proceeding to
be entitled thereto. But the judgment shall
require the payment of the sum or sums
awarded to either the defendant or the court
before the plaintiff can enter upon the property,
or retain it for the public use or purpose if entry
has already been made. (Emphasis supplied.)
Hence, the filing by the Republic of the Supplemental
Complaint for Expropriation impleading Teofilo, Vidal,
LANDTRADE, and AZIMUTH, is not necessarily an admission
that the parcels of land sought to be expropriated are privately
owned. At most, the Republic merely acknowledged in its
Supplemental Complaint that there are private persons also
claiming ownership of the parcels of land. The Republic can
still consistently assert, in both actions for expropriation and
reversion, that the subject parcels of land are part of the public
domain.
In sum, the RTC-Branch 1 erred in dismissing the
original Complaint and disallowing the Supplemental
Complaint in Civil Case No. 106. The Court reverses and sets
aside the Resolutions dated July 12, 2005 and October 24,
2005 of the RTC-Branch 1 in Civil Case 106, and reinstates
the Complaint for Reversion of the Republic.
The Quieting of Title Case
(G.R. Nos. 178779 and 178894)
Essentially, in their Petitions for Review
on Certiorari under Rule 45 of the Rules of Court,
LANDTRADE and Teofilo, and/or Atty. Cabildo are calling
upon this Court to determine whether the Court of Appeals, in
its Decision dated January 19, 2007 in CA-G.R. CV No.
00456, erred in (1) upholding the jurisdiction of the RTC-
Branch 3 to resolve the issues on Vidal's status, filiation, and
heirship in Civil Case No. 4452, the action for quieting of title;
(2) not holding that Vidal and AZIMUTH have neither cause of
action nor legal or equitable title or interest in the parcels of
land covered by OCT Nos. 0-1200 (a.f.) and 0-1201 (a.f.); (3)
finding the evidence sufficient to establish Vidals status as
Doa Demetrias granddaughter and sole surviving heir; and (4)
not holding that Civil Case No. 4452 was already barred by
prescription.
In their Comment, Vidal and AZIMUTH insisted on the
correctness of the Court of Appeals Decision dated January
19, 2007, and questioned the propriety of the Petition for
Review filed by LANDTRADE as it supposedly raised only
factual issues.
The Court rules in favor of Vidal and AZIMUTH.
Petitions for review under Rule 45
A scrutiny of the issues raised, not just in the Petition for
Review of LANDTRADE, but also those in the Petition for
Review of Teofilo and/or Atty. Cabildo, reveals that they are
both factual and legal.
The Court has held in a long line of cases that in a petition for
review on certiorari under Rule 45 of the Rules of Court, only
questions of law may be raised as the Supreme Court is not a
trier of facts. It is settled that as a rule, the findings of fact of
the Court of Appeals especially those affirming the trial court
are final and conclusive and cannot be reviewed on appeal to
the Supreme Court. The exceptions to this rule are: (a) when
the conclusion is a finding grounded entirely on speculations,
surmises or conjectures; (b) when the inference made is
manifestly mistaken, absurd or impossible; (c) when there is
grave abuse of discretion; (d) when the judgment is based on
a misapprehension of facts; (e) when the findings of fact are
conflicting; (f) when the Court of Appeals, in making its
findings, went beyond the issues of the case and the same is
contrary to the admissions of both appellant and appellee; (g)
where the Court of Appeals manifestly overlooked certain
relevant facts not disputed by the parties and which, if properly
considered, would justify a different conclusion; and (h) where
the findings of fact of the Court of Appeals are contrary to
those of the trial court, or are mere conclusions without citation
of specific evidence, or where the facts set forth by the
petitioner are not disputed by the respondent, or where the
findings of fact of the Court of Appeals are premised on
absence of evidence but are contradicted by the evidence on
record.[83] None of these exceptions exists in the Petitions at
bar.
Be that as it may, the Court shall address in full-length all the
issues tendered in the instant Petitions for Review, even when
factual, if only to bolster the conclusions reached by the RTC-
Branch 3 and the Court of Appeals, with which the Court fully
concurs.
Jurisdiction vis--
vis exercise of
jurisdiction
LANDTRADE, Teofilo, and/or Atty. Cabildo argue that the
RTC-Branch 3 had no jurisidiction to resolve the issues of
status, filiation, and heirship in an action for quieting of title as
said issues should be ventilated and adjudicated only in
special proceedings under Rule 90, Section 1 of the Rules of
Court, pursuant to the ruling of this Court in Agapay v.
Palang[84] (Agapay case) and Heirs of Guido Yaptinchay and
Isabel Yaptinchay v. Del Rosario[85](Yaptinchay case). Even
on the assumption that the RTC-Branch 3 acquired
jurisdiction over their persons, LANDTRADE, Teofilo, and/or
Atty. Cabildo maintain that the RTC-Branch 3 erred in
the exercise of its jurisdiction by adjudicating and passing
upon the issues on Vidals status, filiation, and heirship in the
Quieting of Title Case. Moreover, LANDTRADE, Teofilo,
and/or Atty. Cabildo aver that the resolution of issues
regarding status, filiation, and heirship is not merely a matter
of procedure, but of jurisdiction which cannot be waived by
the parties or by the court.
The aforementioned arguments fail to persuade.
In the first place, jurisdiction is not the same as the exercise of
jurisdiction. The Court distinguished between the two, thus:
Jurisdiction is not the same as the
exercise of jurisdiction. As distinguished from
the exercise of jurisdiction, jurisdiction is the
authority to decide a cause, and not the
decision rendered therein. Where there is
jurisdiction over the person and the subject
matter, the decision on all other questions
arising in the case is but an exercise of the
jurisdiction. And the errors which the court
may commit in the exercise of jurisdiction are
merely errors of judgment which are the proper
subject of an appeal.[86] (Emphasis supplied.)
Here, the RTC-Branch 3 unmistakably had jurisdiction
over the subject matter and the parties in Civil Case No. 4452.
Jurisdiction over the subject matter or nature of the
action is conferred only by the Constitution or by law. Once
vested by law on a particular court or body, the jurisdiction
over the subject matter or nature of the action cannot be
dislodged by anybody other than by the legislature through the
enactment of a law. The power to change the jurisdiction of the
courts is a matter of legislative enactment, which none but the
legislature may do. Congress has the sole power to define,
prescribe and apportion the jurisdiction of the courts.[87]
 The RTC has jurisdiction over an action for quieting of
title under the circumstances described in Section 19(2) of
Batas Pambansa Blg. 129, as amended:
SEC. 19. Jurisdiction in civil
cases. Regional Trial Courts shall exercise
exclusive original jurisdiction:
xxxx
(2) In all civil actions which involve the
title to, or possession of, real property, or
any interest therein, where the assessed
value of the property involved exceeds
Twenty thousand pesos (P20,000.00) or, for
civil actions in Metro Manila, where such value
exceeds Fifty thousand pesos (P50,000.00)
except actions for forcible entry into and
unlawful detainer of lands or buildings, original
jurisdiction over which is conferred upon the
Metropolitan Trial Courts, Municipal Trial
Courts, and Municipal Circuit Trial Courts.
Records show that the parcels of land subject of Civil
Case No. 4452 have a combined assessed value
of P35,398,920.00,[88] undisputedly falling within the jurisdiction
of the RTC-Branch 3.
The RTC-Branch 3 also acquired jurisdiction over the
person of Teofilo when he filed his Answer to the Complaint of
Vidal and AZIMUTH; and over the juridical personality of
LANDTRADE when the said corporation was allowed to
intervene in Civil Case No. 4452.
Considering that the RTC-Branch 3 had jurisdiction over the
subject matter and parties in Civil Case No. 4452, then it can
rule on all issues in the case, including those on Vidals status,
filiation, and heirship, in exercise of its jurisdiction. Any alleged
erroneous finding by the RTC-Branch 3 concerning Vidals
status, filiation, and heirship in Civil Case No. 4452, is merely
an error of judgment subject to the affirmation, modification, or
reversal by the appellate court when appealed.
The Agapay and Yaptinchay cases
LANDTRADE, Teofilo, and/or Atty. Cabildo cannot rely
on the cases of Agapay and Yaptinchay to support their
position that declarations on Vidals status, filiation, and heirsip,
should be made in special proceedings and not in Civil Case
No. 4452.
In the Agapay case, the deceased Miguel Agapay
(Miguel) contracted two marriages. Miguel married Carlina
(sometimes referred to as Cornelia) in 1949, and they had a
daughter named Herminia, who was born in 1950. Miguel left
for Hawaii a few months after his wedding to Carlina. When
Miguel returned to the Philippines in 1972, he did not live with
Carlina and Herminia. He married Erlinda in 1973, with whom
he had a son named Kristopher, who was born in 1977. Miguel
died in 1981. A few months after Miguels death, Carlina and
Herminia filed a complaint for recovery of ownership and
possession with damages against Erlinda over a riceland and
house and lot in Pangasinan, which were allegedly purchased
by Miguel during his cohabitation with Erlinda.The RTC
dismissed the complaint, finding little evidence that the
properties pertained to the conjugal property of Miguel and
Carlina. The RTC went on to provide for the intestate shares of
the parties, particularly of Kristopher, Miguels illegitimate
son. On appeal, the Court of Appeals: (1) reversed the RTC
judgment; (2) ordered Erlinda to vacate and deliver the
properties to Carlina and Herminia; and (3) ordered the
Register of Deeds to cancel the Transfer Certificates of Title
(TCTs) over the subject property in the name of Erlinda and to
issue new ones in the names of Carlina and Herminia. Erlinda
filed a Petition for Review with this Court.
In resolving Erlindas Petition, the Court held in
the Agapay case that Article 148 of the Family Code applied to
Miguel and Erlinda. Article 148 specifically governs the
property relations of a man and a woman who are not
capacitated to marry each other and live exclusively with each
other as husband and wife without the benefit of marriage or
under a void marriage. Under said provision, only the
properties acquired by both parties through their actual joint
contribution of money, property, or industry shall be owned by
them in common in proportion to their respective
contributions. In this case, the Court found that the money
used to buy the subject properties all came from Miguel.
The Court then proceeded to address another issue in
the Agapay case, more relevant to the one at bar:
The second issue concerning Kristopher
Palangs status and claim as an illegitimate son
and heir to Miguels estate is here resolved in
favor of respondent courts correct assessment
that the trial court erred in making
pronouncements regarding Kristophers heirship
and filiation inasmuch as questions as to who
are the heirs of the decedent, proof of filiation of
illegitimate children and the determination of the
estate of the latter and claims thereto should be
ventilated in the proper probate court or in a
special proceeding instituted for the purpose
and cannot be adjudicated in the instant
ordinary civil action which is for recovery of
ownership and possession.[89]
The Yaptinchay case involved two parcels of land
in Cavite which were supposedly owned by Guido and Isabel
Yaptinchay (spouses Yaptinchay). Upon the death of the
spouses Yaptinchay, their heirs (Yaptinchay heirs) executed
an Extra-Judicial Settlement of the deceased spouses
estate. However, the Yaptinchay heirs discovered that the
properties were already covered by TCTs in the name of
Golden Bay Realty Corporation (Golden Bay), prompting the
Yaptinchay heirs to file with the RTC a complaint against
Golden Bay for the annulment and/or declaration of nullity of
TCT Nos. 493363 to 493367 and all their derivatives, or in the
alternative, the reconveyance of realty with a prayer for a writ
of preliminary injunction and/or restraining order with
damages. The Yaptinchay heirs later filed an amended
complaint to include additional defendants to
whom Golden Bay sold portions of the subject properties. The
RTC initially dismissed the amended complaint, but acting on
the motion for reconsideration of the Yaptinchay heirs,
eventually allowed the same. Golden Bay and its other co-
defendants presented a motion to dismiss the amended
complaint, which was granted by the RTC. The Yaptinchay
heirs came before this Court viaa Petition for Certiorari.
The Court first observed in the Yaptinchay case that
the Yaptinchay heirs availed themselves of the wrong
remedy. An order of dismissal is the proper subject of an
appeal, not a petition for certiorari. Next, the Court affirmed the
dismissal of the amended complaint, thus:
Neither did the respondent court commit
grave abuse of discretion in issuing the
questioned Order dismissing the Second
Amended Complaint of petitioners, x x x.
xxxx
In Litam, etc., et al. v. Rivera, this court
opined that the declaration of heirship must be
made in an administration proceeding, and not
in an independent civil action. This doctrine was
reiterated in Solivio v. Court of Appeals where
the court held:
In Litam, et al. v. Rivera,
100 Phil. 364, where despite the
pendency of the special
proceedings for the settlement of
the intestate estate of the
deceased Rafael Litam, the
plaintiffs-appellants filed a civil
action in which they claimed that
they were the children by a
previous marriage of the
deceased to a Chinese woman,
hence, entitled to inherit his one-
half share of the conjugal
properties acquired during his
marriage to Marcosa Rivera, the
trial court in the civil case
declared that the plaintiffs-
appellants were not children of
the deceased, that the properties
in question were paraphernal
properties of his wife, Marcosa
Rivera, and that the latter was
his only heir. On appeal to this
Court, we ruled that such
declarations (that Marcosa
Rivera was the only heir of the
decedent) is improper, in Civil
Case No. 2071, it being within
the exclusive competence of the
court in Special Proceedings No.
1537, in which it is not as yet, in
issue, and, will not be, ordinarily,
in issue until the presentation of
the project of partition. (p. 378).
The trial court cannot make a
declaration of heirship in the civil action for the
reason that such a declaration can only be
made in a special proceeding. Under Section 3,
Rule 1 of the 1997 Revised Rules of Court, a
civil action is defined as one by which a party
sues another for the enforcement or protection
of a right, or the prevention or redress of a
wrong while a special proceeding is a remedy
by which a party seeks to establish a status, a
right, or a particular fact. It is then decisively
clear that the declaration of heirship can be
made only in a special proceeding inasmuch as
the petitioners here are seeking the
establishment of a status or right.[90]
LANDTRADE, Teofilo, and/or Atty. Cabildo missed one vital
factual distinction between the Agapay and Yaptinchay cases,
on one hand, and the present Petitions, on the other, by
reason of which, the Court shall not apply the prior two to the
last.
The Agapay and Yaptinchay cases, as well as the
cases of Litam v. Rivera[91] and Solivio v. Court of
Appeals,[92] cited in the Yaptinchay case, all arose
from actions for reconveyance; while the instant Petitions
stemmed from an action for quieting of title. The Court may
have declared in previous cases that an action for
reconveyance is in the nature of an action for quieting of
title,[93] but the two are distinct remedies.
Ordinary civil
action for
reconveyance
vis-a-vis special
proceeding for
quieting of title
The action for reconveyance is based on Section 55 of
Act No. 496, otherwise known as the Land Registration Act, as
amended, which states [t]hat in all cases of registration
procured by fraud the owner may pursue all his legal and
equitable remedies against the parties to such fraud, without
prejudice, however, to the rights of any innocent holder for
value of a certificate of title.
The Court, in Heirs of Eugenio Lopez, Sr. v.
Enriquez,[94] described an action for reconveyance as follows:
An action for reconveyance is
an action in personam available to a person
whose property has been wrongfully
registered under the Torrens system in
anothers name. Although the decree is
recognized as incontrovertible and no longer
open to review, the registered owner is not
necessarily held free from liens. As a remedy,
an action for reconveyance is filed as
an ordinary action in the ordinary courts of
justice and not with the land registration
court. Reconveyance is always available as
long as the property has not passed to an
innocent third person for value. x x x
(Emphases supplied.)
On the other hand, Article 476 of the Civil Code lays
down the circumstances when a person may institute an action
for quieting of title:
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.
In Calacala v. Republic,[95] the Court elucidated on the nature
of an action to quiet title:
Regarding the nature of the action filed before
the trial court, quieting of title is a common law
remedy for the removal of any cloud upon or
doubt or uncertainty with respect to title to real
property. Originating in equity jurisprudence, its
purpose is to secure x x x an adjudication that a
claim of title to or an interest in property,
adverse to that of the complainant, is invalid, so
that the complainant and those claiming under
him may be forever afterward free from any
danger of hostile claim. In an action for quieting
of title, the competent court is tasked
to determine the respective rights of the
complainant and other claimants, x x x not
only to place things in their proper place, to
make the one who has no rights to said
immovable respect and not disturb the other, but
also for the benefit of both, so that he who has
the right would see every cloud of doubt over the
property dissipated, and he could afterwards
without fear introduce the improvements he may
desire, to use, and even to abuse the property
as he deems best x x x . (Emphases supplied.)
The Court expounded further in Spouses Portic v.
Cristobal[96] that:
Suits to quiet title are characterized
as proceedings quasi in rem. Technically,
they are neither in rem nor in personam. In an
action quasi in rem, an individual is named as
defendant. However, unlike suits in rem,
a quasi in rem judgment is conclusive only
between the parties.
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. Thus, lack of an actual
certificate of title to a property does not
necessarily bar an action to quiet title. x x x
(Emphases supplied.)
The Court pronounced in the Agapay and Yaptinchay
cases that a declaration of heirship cannot be made in
an ordinary civil action such as an action for reconveyance,
but must only be made in a special proceeding, for it involves
the establishment of a status or right.
The appropriate special proceeding would have been
the settlement of the estate of the decedent. Nonetheless, an
action for quieting of title is also a special proceeding,
specifically governed by Rule 63 of the Rules of Court on
declaratory relief and similar remedies.[97] Actions for
declaratory relief and other similar remedies are distinguished
from ordinary civil actions because:
2. In declaratory relief, the subject-
matter is a deed, will, contract or other written
instrument, statute, executive order or
regulation, or ordinance. The issue is the
validity or construction of these
documents. The relief sought is the declaration
of the petitioners rights and
duties thereunder.
The concept of a cause of action in
ordinary civil actions does not apply to
declaratory relief as this special civil action
presupposes that there has been no breach or
violation of the instruments
involved. Consequently, unlike other judgments,
the judgment in an action for declaratory relief
does not essentially entail any executional
process as the only relief to be properly granted
therein is a declaration of the rights and
duties of the parties under the instrument,
although some exceptions have been
recognized under certain situations.[98]
Civil Case No. 4452 could not be considered an action
for reconveyance as it is not based on the allegation that the
two parcels of land, Lots 1 and 2, have been wrongfully
registered in another persons name. OCT Nos. 0-1200 (a.f.)
and 0-1201 (a.f.), covering the subject properties, are still in
Doa Demetrias name. Vidal and Teofilo each claims to have
inherited the two parcels of land from the late Doa Demetria as
said decedents sole heir, but neither Vidal nor Teofilo has
been able to transfer registration of the said properties to
her/his name as of yet.
Instead, Civil Case No. 4452 is indisputably an action
for quieting of title, a special proceeding wherein the court is
precisely tasked to determine the rights of the parties as to a
particular parcel of land, so that the complainant and those
claiming under him/her may be forever free from any danger of
hostile claim. Vidal asserted title to the two parcels of land as
Doa Demetrias sole heir. The cloud on Vidals title, which she
sought to have removed, was Teofilos adverse claim of title to
the same properties, also as Doa Demetrias only heir. For it to
determine the rights of the parties in Civil Case No. 4452, it
was therefore crucial for the RTC-Branch 3 to squarely make a
finding as to the status, filiation, and heirship of Vidal in
relation to those of Teofilo. A finding that one is Doa Demetrias
sole and rightful heir would consequently exclude and
extinguish the claim of the other.
Even assuming arguendo that the proscription in
the Agapay and Yaptinchay cases against making declarations
of heirship in ordinary civil actions also extends to actions for
quieting of title, the same is not absolute.
In Portugal v. Portugal-Beltran[99] (Portugal case), the Court
recognized that there are instances when a declaration of
heirship need not be made in a separate special proceeding:
The common doctrine
in Litam, Solivio and Guilas in which
the adverse parties are putative heirs to the
estate of a decedent or parties to the special
proceedings for its settlement is that if the
 special proceedings are pending, or if there are
no special proceedings filed but there is, under
the circumstances of the case, a need to file
one, then the determination of, among other
issues, heirship should be raised and settled in
said special proceedings. Where special
proceedings had been instituted but had been
finally closed and terminated, however, or if a
putative heir has lost the right to have himself
declared in the special proceedings as co-heir
and he can no longer ask for its re-opening,
then an ordinary civil action can be filed for his
declaration as heir in order to bring about the
annulment of the partition or distribution or
adjudication of a property or properties
belonging to the estate of the deceased.[100]
In the Portugal case itself, the Court directed the trial
court to already determine petitioners status as heirs of the
decedent even in an ordinary civil action, i.e., action for
annulment of title, because:
It appearing x x x that in the present case the
only property of the intestate estate of Portugal
is the Caloocan parcel of land, to still subject it,
under the circumstances of the case, to a
special proceeding which could be long, hence,
not expeditious, just to establish the status of
petitioners as heirs is not only impractical; it is
burdensome to the estate with the costs and
expenses of an administration proceeding. And
it is superfluous in light of the fact that the
parties to the civil casesubject of the present
case, could and had already in fact presented
evidence before the trial court which assumed
jurisdiction over the case upon the issues it
defined during pre-trial.
In fine, under the circumstances of the present
case, there being no compelling reason to still
subject Portugals estate to administration
proceedings since a determination of petitioners
status as heirs could be achieved in the civil
case filed by petitioners, the trial court should
proceed to evaluate the evidence presented by
the parties during the trial and render a decision
thereon upon the issues it defined during pre-
trial, x x x.[101]
Another case, Heirs of Teofilo Gabatan v. Court of
Appeals[102] (Gabatan case), involved an action for recovery of
ownership and possession of property with the opposing
parties insisting that they are the legal heirs of the
deceased. Recalling the Portugal case, the Court ruled:
Similarly, in the present case, there
appears to be only one parcel of land being
claimed by the contending parties as their
inheritance from Juan Gabatan. It would be
more practical to dispense with a separate
special proceeding for the determination of the
status of respondent as the sole heir of Juan
Gabatan, specially in light of the fact that the
parties to Civil Case No. 89-092, had voluntarily
submitted the issue to the RTC and already
presented their evidence regarding the issue of
heirship in these proceeding. Also the RTC
 assumed jurisdiction over the same and
consequently rendered judgment thereon.
In Fidel v. Court of Appeals[103] (Fidel case), therein
respondents, the heirs of the late Vicente Espineli (Vicente)
from his first marriage, instituted an action to annul the sale of
Vicentes property to therein petitioners, the spouses Fidel. The
subject property was sold to petitioners by Vicentes heirs from
his second marriage. Even though ones legitimacy can only be
questioned in a direct action seasonably filed by the proper
party, the Court held that it was necessary to pass upon
respondents relationship to Vicente in the action for annulment
of sale so as to determine respondents legal rights to the
subject property. In fact, the issue of whether respondents are
Vicentes heirs was squarely raised by petitioners in their Pre-
Trial Brief. Hence, petitioners were estopped from assailing
the ruling of the trial court on respondents status.
In Civil Case No. 4452, Teofilo and/or Atty. Cabildo
themselves asked the RTC-Branch 3 to resolve the issue of
Vidal's legal or beneficial ownership of the two parcels of
land.[104] During trial, Vidal already presented before the RTC-
Branch 3 evidence to establish her status, filiation, and
heirship. There is no showing that Doa Demetria left any other
property that would have required special administration
proceedings. In the spirit of the Portugal, Gabatan, and Fidel
cases, the Court deems it more practical and expeditious to
settle the issue on Vidals status, filiation, and heirship in Civil
Case No. 4452.
Title in quieting
of title
LANDTRADE, Teofilo, and/or Atty. Cabildo further
contend that Vidal and AZIMUTH have no cause of action for
quieting of title since Vidal has no title to the two parcels of
land. In comparison, Teofilos title to the same properties, as
Doa Demetrias only heir, was already established and
recognized by this Court in the 1997 Cacho case.
Again, the Court cannot sustain the foregoing
contention of LANDTRADE, Teofilo, and/or Atty. Cabildo.
It must be borne in mind that the concept of a cause of
action in ordinary civil actions does not apply to quieting of
title. In declaratory relief, the subject-matter is a deed, will,
contract or other written instrument, statute, executive order or
regulation, or ordinance. The issue is the validity or
construction of these documents. The relief sought is the
declaration of the petitioners rights and duties thereunder.
Being in the nature of declaratory relief, this special civil action
presupposes that there has yet been no breach or violation of
the instruments involved.[105]
In an action for quieting of title, the subject matter is the
title sought to have quieted. Title is not limited to the certificate
of registration under the Torrens System (i.e., OCT or
TCT). Pursuant to Article 477 of the Civil Code, the plaintiff
must have legal or equitable title to, or interest in, the real
property subject of the action for quieting of title. The plaintiff
need not even be in possession of the property. If she is
indeed Doa Demetrias sole heir, Vidal already has equitable
title to or interest in the two parcels of land by right of
succession, even though she has not yet secured certificates
of title to the said properties in her name.
LANDTRADE, Teofilo, and/or Atty. Cabildo mistakenly believe
that the 1997 Cacho case had conclusively settled Teofilo's
identity and existence as Doa Demetrias sole heir. They failed
to appreciate that the 1997 Cacho case involved Teofilos
petition for reconstitution of title, treated as a petition for the
re-issuance of Decree Nos. 10364 and 18969. The grant by
the RTC of Teofilos petition, affirmed by this Court, only
conclusively established the prior issuance and
existence and the subsequent loss of the two decrees, thus,
entitling Teofilo to the re-issuance of the said decrees in
their original form and condition.
As the Court of Appeals pointed out in its assailed
Decision dated January 19, 2007, the issue of Teofilos
heirship was not the lis mota of the 1997 Cacho case. It was
addressed by the Court in the 1997 Cacho case for the simple
purpose of determining Teofilos legal interest in filing a petition
for the re-issuance of the lost decrees. The Court merely found
therein that Teofilos Affidavit of Adjudication, executed in the
U.S.A. before the Philippine Consulate General, enjoyed the
presumption of regularity and, thus, sufficiently established
Teofilos legal interest. The 1997 Cacho case, however, did not
conclusively settle that Teofilo is indeed Doa Demetrias only
heir and the present owner, by right of succession, of the
subject properties.
Factual findings
of the RTC-
Branch 3 and the
Court of Appeals
LANDTRADE, Teofilo, and/or Atty. Cabildo additionally posit
that the evidence presented by Vidal and AZIMUTH were
insufficient to prove the fact of Vidal's filiation and heirship to
Doa Demetria. LANDTRADE, Teofilo, and/or Atty. Cabildo
particularly challenged the reliance of the RTC-Branch 3 on
Vidals baptismal certificate, arguing that it has no probative
value and is not conclusive proof of filiation.
Alternative means of proving an individuals filiation have been
recognized by this Court in Heirs of Ignacio Conti v. Court of
Appeals.[106] The property in litigation in said case was co-
owned by Lourdes Sampayo (Sampayo) and Ignacio Conti,
married to Rosario Cuario (collectively referred to as the
spouses Conti). Sampayo died without issue. Therein
respondents, claiming to be Sampayos collateral relatives,
filed a petition for partition of the subject property, plus
damages. To prove that they were collaterally related to
Sampayo through the latters brothers and sisters, respondents
submitted photocopies of the birth certificates, certifications on
the non-availability of records of births, and certified true
copies of the baptismal certificates of Sampayos siblings. The
spouses Conti questioned the documentary evidence of
respondents filiation on the ground that these were
incompetent and inadmissible, but the Court held that:
Under Art. 172 of the Family Code, the filiation
of legitimate children shall be proved by any
other means allowed by the Rules of Court and
special laws, in the absence of a record of birth
or a parents admission of such legitimate
filiation in a public or private document duly
signed by the parent. Such other proof of ones
filiation may be a baptismal certificate, a judicial
admission, a family Bible in which his name has
been entered, common reputation respecting
his pedigree, admission by silence, the
testimonies of witnesses and other kinds of
proof admissible under Rule 130 of the Rules of
Court. By analogy, this method of proving
filiation may also be utilized in the instant case.
xxxx
The admissibility of baptismal
certificates offered by Lydia S. Reyes, absent
the testimony of the officiating priest or the
official recorder, was settled in People v. Ritter,
citing U.S. v. de Vera (28 Phil. 105 [1914]), thus
- the other documentary and testimonial evidence submitted on
x x x the entries made in
the Registry Book may be
considered as entries made in the
course of the business under
Section 43 of Rule 130, which is
an exception to the hearsay rule.
The baptisms administered by the
church are one of its transactions
in the exercise of ecclesiastical
duties and recorded in the book
of the church during the course of
its business.
It may be argued that baptismal
certificates are evidence only of the
administration of the sacrament, but in this
case, there were four (4) baptismal certificates
which, when taken together, uniformly show
that Lourdes, Josefina, Remedios and Luis had
the same set of parents, as indicated
therein. Corroborated by the undisputed
testimony of Adelaida Sampayo that with the
demise of Lourdes and her brothers Manuel,
Luis and sister Remedios, the only sibling left
was Josefina Sampayo Reyes, such baptismal
certificates have acquired evidentiary weight to
prove filiation.[107]
Thus, Vidals baptismal certificate is not totally bereft of
any probative value. It may be appreciated, together with all
Vidals filiation, to wit:
The first issue proposed by petitioners
for resolution is whether or not petitioner
Demetria C. Vidal is the sole surviving heir of
the late Doa Demetria Cacho. To prove that,
indeed, she is the sole surviving heir of the late
Doa Demetria Cacho, she testified in open court
and identified the following documentary
evidence, to wit:
Exhibit A Birth Certificate of
Demetria C. Vidal
Exhibit B Partida de Bautismo of
Demetria C. Vidal
Exhibit C Certificate of Baptism
Demetria C. Vidal
Exhibit D Cacho Family Tree
Exhibit D-1 Branch of Demetria
Cacho
 Exhibit F Death Certificate of
Demetria Cacho.
Exhibit P Drivers license of
Demetria C. Vidal.
Exhibit Q to Q5 The book entitled
CACHO, the introductory
page on March 1988
when the data were
compiled, page 58 on the
Vidal branch of the
Cacho family, page 62 on
Demetria Cacho and her
descendants, page 69 on
the family member with
the then latest birth day
26 March 1988, and page
77 with the picture of
Demetria Cacho Vidal,
Dionisio Vidal and
[108]
Francisco Vidal.
In contrast, LANDTRADE, Teofilo, and/or Atty. Cabildo
failed to present any evidence at all in support of their
claims. According to the RTC-Branch 3:
Landtrade was also declared to have
waived its right to present evidence on its
defense and counterclaim in the above-entitled
case in view of its failure to present evidence on
their scheduled trial date.
xxxx
Since respondents Teofilo Cacho and
Atty. Godofredo Cabildo opted not to adduce
evidence in this case as they failed to appear
during the scheduled trial dates, the court shall
decide on the basis of the evidence for the
respondents-intervenor and petitioners.[109]
Based on the evidence presented before it, the RTC-
Branch 3 made the following factual findings:
From the evidence adduced, both
testimonial and documentary, the court is
convinced that petitioner Vidal is the
granddaughter of Demetria Cacho Vidal, the
registered owner of the subject property covered
by decree Nos. 10364 & 18969, reissued as
Decrees No. 19364 and No. 16869. Such being
the case, she is an heir of Demetria Cacho
Vidal.
Petitioner Vidals Certificate of Birth (Exh.
A) shows that she was born on June 3, 1941,
with the name Demetria Vidal. [Her] father was
Francisco Vidal and her mother was Fidela
Confesor, Francisco Vidal is the son of Dionisio
Vidal and Demetria Cacho as shown by [his]
Partida de Bautismo (Baptismal
Certificate). Moreover, it was shown in the same
document that her godmother was Demetria
Cacho. By inference, this Demetria Cacho is
actually Demetria Cacho Vidal because she was
married to Dionisio Vidal, the father of Francisco
Vidal.
 Demetria Cacho. The following facts and
Now then, is Demetria Cacho Vidal the circumstances negate the impression that he is
same person referred to in Cacho v. the son, as he claims to be, of Doa Demetria
Government of the United States (28 Phil. 616 Cacho. Thus:
[1914])? Page 618, Vol. 28 of the Philippine
Reports would indicate that the applicant for a) Doa Demetria Cacho was
registration was Doa Demetria Cacho y Soriano married to Don Dionisio Vidal,
(Exh. R-1). The Death Certificate of Demetria and thus her full name was
Cacho Vidal shows that her mother was Doa Demetria Cacho
Candelaria Soriano (Exh. F). Necessarily, they Vidal. Her only child,
are one and the same person. This is further expectedly, carried the
confirmed by the fact that the husband of surname Vidal (Francisco
Demetria Cacho Vidal, Seor Dionisio Vidal, was Cacho Vidal). Had Teofilo
quoted in pp. 629-630 of the aforecited decision Cacho actually been a son of
as the husband of Demetria Cacho (Exh. R-3). Demetria Cacho, he would
and should have carried the
The book CACHO (Exhs. Q to Q-5) and name Teofilo Cacho Vidal,
the Cacho Family Tree (Exhs. D to D-1) further but he did not.
strengthen the aforecited findings of this Court.
b) Teofilo Cacho admits to
It was established by petitioner Vidals being married to one Elisa
own testimony that at the time of Doa Demetria Valderrama in the Special
Cacho's death, she left no heir other than Power of Attorney he issued
petitioner Vidal. Her husband, Don Dionisio, to Atty. Godofredo [Cabildo]
died even before the war, while her only child, (Exh. O).Teofilo Cacho
Francisco Cacho Vidal xxx Vidals father died married Elisa Valderrama on
during the war. Petitioners only sibling Francisco 27 May 1953, in the Parish of
Dionisio died at childbirth. the Immaculate Conception,
Bani, Pangasinan. The
xxxx Certificate of Marriage shows
that Teofilo Cacho is the son
The next factual issue proposed by of Agustin Cacho and
petitioners is whether or not respondent Teofilo Estefania Cordial, not
Cacho is the son or heir of the late Doa Demetria Cacho. In his
 Certificate of Baptism (Exh.
G), he was born to Agustin
Cacho and Estefania Cordial
on May 1930 (when Doa
Demetria Cacho was already
50 years old).
c) The Cacho Family Tree
(Exh. D) (that is, the Cacho
Family to which Doa Demetria
Cacho belonged) as well as
the book on the Cacho Family
(Exh. Q) are bereft of any
mention of Teofilo Cacho or
his wife Elisa Valderrama, or
even his real father Agustin
Cacho, or mother Estefania
Cordial. They are not known
to be related to the Cacho
family of Doa Demetria
Cacho.
d) Paragraph 1.11 of the
Petition charges respondent
Teofilo Cacho of having
falsely and fraudulently
claiming to be the son and
sole heir of the late Doa
Demetria Cacho. In his
answer to this particular
paragraph, he denied the
same for lack of knowledge or
information to form a petitioner Azimuth International Development
belief. He should know
whether this allegation is true
or not because it concerns
him. If true, he should admit
and if false, he opted to deny
the charges for lack of
knowledge or information to
form a belief. The Court
considers his denial as an
admission of the allegation
that he is falsely and
fraudulently claiming to be the
son and sole heir of the late
Doa Demetria Cacho.[110]
Considering the aforequoted factual findings, the RTC-
Branch 3 arrived at the following legal conclusions, quieting
the titles of Vidal and AZIMUTH, viz:
The first proposed legal issue to be
resolved had been amply discussed under the
first factual issue. Certainly, petitioner Vidal has
hereditary rights, interest, or title not only to a
portion of the Subject Property but to the entire
property left by the late Doa Demetria Cacho
Vidal, subject, however, to the Deed of
Conditional Conveyance executed by petitioner
Vidal of a portion of the Subject Property in favor
of petitioner Azimuth International Development
Corporation (Exh. J) executed pursuant to their
Memorandum of Agreement (Exh.
I). Consequently, it goes without saying that
Corporation has a right, interest in, or title to a
portion of the subject property.
As discussed earlier in this decision,
Teofilo Cacho, not being the son, as he claims
to be, of the late Doa Demetria Cacho Vidal, has
no hereditary rights to the Subject Property left
by Doa Demetria Cacho Vidal. He failed to show
any evidence that he is the son of the late Doa
Demetria Cacho Vidal as he and his co
respondent, Atty. Godofredo Cabildo, even
failed to appear on the scheduled trial date.
It is, therefore, safe to conclude that
respondents Teofilo Cacho and/or Atty.
Godofredo Cabildo and their
transferees/assignees have no right, interest in,
or title to the subject property.
Prescinding from the finding of this
Court that respondent Teofilo Cacho is not the
son of the registered owner of the Subject
Property, the late Doa Demetria Cacho Vidal,
respondent Cacho committed false pretenses
and fraudulent acts in representing himself as
son and sole heir of Doa Demetria Cacho
(Vidal) in his petition in court, which eventually
led to the reconstitution of the titles of Doa
Demetria Cacho (Vidal). Certainly, his
misrepresentation in the reconstitution case,
which apparently is the basis of his claim to the
subject property, casts clouds on [respondents']
title to the subject property.
It is only right that petitioner Vidal
should seek protection of her ownership from
acts tending to cast doubt on her title. Among
the legal remedies she could pursue, is this
petition for Quieting of Title under Chapter 3,
Title I, Book II of the Civil Code, Articles 476 to
481 inclusive. x x x.[111]
The Court of Appeals affirmed in toto the judgment of
the RTC-Branch 3. The appellate court even soundly
trounced Teofilos attack on the factual findings of the trial
court:
[T]he material facts sought to be established by
the afore-mentioned documentary evidence
corroborated by the testimony of VIDAL, whose
testimony or credibility neither TEOFILO and
LANDTRADE even attempted to impeach, only
proves one thing, that she is the granddaughter
of DOA DEMETRIA and the sole heiress
thereof.
xxxx
Hence, it is now too late for appellant
TEOFILO to assail before Us the facts proven
during the trial, which he failed to refute in open
court. Verily, TEOFILOs lackadaisical attitude in
the conduct of his defense only shows that he
has no proof to offer in refutation of the
evidence advanced by appellee VIDAL.
 Otherwise stated, appellant TEOFILO is
an impostor, a pretender and bogus heir of
DOA DEMETRIA.
xxxx
Besides, it is quite unnatural and
against human nature for a rightful heir, if
TEOFILO is really one, to merely stand still with
folded arms, while the accusing finger of VIDAL
is right on his very nose. In all likelihood, and
with all his might and resources, a rightful heir
may even be expected to cross continents and
reach distant shores to protect his interest over
the subject properties, which in this case is
arguably worth more than a Kings ransom.
It stands on record that TEOFILO
CACHO has all along even prior to executing
his Affidavit of Adjudication in 1985 in Chicago,
United States of America, and in simultaneously
executing a Special Power of Attorney in favor
of ATTY. CABILDO, had remained in the United
States, and not for a single moment appeared
in court except through his agents or
representatives. To Our mind, this fact alone
adversely affects his pretension in claiming to
be an heir of DOA DEMETRIA.[112]
As a rule, the findings of fact of the trial court when
affirmed by the Court of Appeals are final and conclusive, and
cannot be reviewed on appeal by this Court as long as they
are borne out by the record or are based on substantial
evidence. It is not the function of the Court to analyze or weigh
all over again the evidence or premises supportive of such
factual determination. The Court has consistently held that
the findings of the Court of Appeals and other lower courts
are, as a rule, accorded great weight, if not binding upon it,
save for the most compelling and cogent reasons.[113] There is
no justification for the Court to deviate from the factual findings
of the RTC-Branch 3 and the Court of Appeals which are
clearly supported by the evidence on record.
Prescription
LANDTRADE finally asserts that the action for quieting of title
of Vidal and AZIMUTH already prescribed since LANDTRADE
has been in possession of the two parcels of land in
question. The prescriptive period for filing said action lapsed in
1995, ten years from the time Teofilo executed his Affidavit of
Adjudication in 1985. Yet, Vidal and AZIMUTH instituted Civil
Case No. 4452 only in 1998.
It is too late in the day for LANDTRADE to raise the
issue of prescription of Civil Case No. 4452 for the first time
before this Court. In this jurisdiction, the defense of
prescription cannot be raised for the first time on
appeal. Such defense may be waived, and if it was not raised
as a defense in the trial court, it cannot be considered on
appeal, the general rule being that the Appellate Court is not
authorized to consider and resolve any question not properly
raised in the lower court.[114]
But even if the Court takes cognizance of the issue of
prescription, it will rule against LANDTRADE.
A real action is one where the plaintiff seeks the
recovery of real property or, as indicated in what is now Rule
4, Section 1 of the Rules of Court, a real action is an action
affecting title to or recovery of possession of real
property.[115] An action for quieting of title to real property,
such as Civil Case No. 4452, is indubitably a real action.
Article 1141 of the Civil Code plainly provides that real
actions over immovables prescribe after thirty years. Doa
Demetria died in 1974, transferring by succession, her title to
the two parcels of land to her only heir, Vidal. Teofilo, through
Atty. Cabildo, filed a petition for reconstitution of the
certificates of title covering said properties in 1978. This is the
first palpable display of Teofilos adverse claim to the same
properties, supposedly, also as Doa Demetrias only
heir. When Vidal and AZIMUTH instituted Civil Case No. 4452
in 1998, only 20 years had passed, and the prescriptive period
for filing an action for quieting of title had not yet prescribed.
Nevertheless, the Court notes that Article 1411 of the
Civil Code also clearly states that the 30-year prescriptive
period for real actions over immovables is without
prejudice to what is established for the acquisition of
ownership and other real rights by prescription. Thus, the
Court must also look into the acquisitive prescription periods of
ownership and other real rights.
Acquisitive prescription of dominion and real rights may
be ordinary or extraordinary. [116]
Ordinary acquisitive prescription requires
possession of things in good faith and with just title for the time
fixed by law.[117] In the case of ownership and other real rights
over immovable property, they are acquired by ordinary
prescription through possession of 10 years.[118]
LANDTRADE cannot insist on the application of the 10-
year ordinary acquisitive prescription period since it cannot be
considered a possessor in good faith. 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.[119]
LANDTRADE came to possession of the two parcels of
land after purchasing the same from Teofilo. The Court
stresses, however, that Teofilo is not the registered owner of
the subject properties. The said properties are still registered
in Doa Demetrias name under OCT Nos. 0-1200 (a.f.) and 0-
1201 (a.f.). The Affidavit of Adjudication, by which Teofilo
declared himself to be the sole heir of Doa Demetrias estate,
is not even annotated on the OCTs. Worse, LANDTRADE is
not dealing directly with Teofilo, but only with the latters
attorney-in-fact, Atty. Cabildo. It is axiomatic that one who
buys from a person who is not a registered owner is not a
purchaser in good faith.[120]
Furthermore, in its Complaint for Unlawful Detainer
against NAPOCOR and TRANSCO, which was docketed as
Civil Case No. 11475-AF before the MTCC, LANDTRADE
itself alleged that when it bought the two parcels of land from
Teofilo, portions thereof were already occupied by
the Overton Sub-station and Agus 7 Warehouse of NAPOCOR
and TRANSCO. This is another circumstance which should
have prompted LANDTRADE to investigate or inspect the
property being sold to it. It is, of course, expected from the
purchaser of a valued piece of land to inquire first into the
status or nature of possession of the occupants, i.e., whether
or not the occupants possess the land en concepto de dueo, in
concept of owner. As is the common practice in the real estate
industry, an ocular inspection of the premises involved is a
safeguard a cautious and prudent purchaser usually
takes. Should he find out that the land he intends to buy is
occupied by anybody else other than the seller who, as in this
case, is not in actual possession, it would then be incumbent
upon the purchaser to verify the extent of the occupants
possessory rights. The failure of a prospective buyer to take
such precautionary steps would mean negligence on his part
and would thereby preclude him from claiming or invoking the
rights of a purchaser in good faith.[121]
Since the ordinary acquisitive prescription period of 10 years
does not apply to LANDTRADE, then the Court turns its
attention to the extraordinary acquisitive prescription
period of 30 years set by Article 1137 of the Civil Code, which
reads:
ART. 1137. Ownership and other real
rights over immovables also prescribe through
uninterrupted adverse possession thereof for
thirty years, without need of title or of good faith.
LANDTRADE adversely possessed the subject properties no
earlier than 1996, when it bought the same from Teofilo, and
Civil Case No. 4452 was already instituted two years later
in 1998. LANDTRADE cannot tack its adverse possession of
the two parcels of land to that of Teofilo considering that there
is no proof that the latter, who is already residing in the U.S.A.,
adversely possessed the properties at all.
Thus, the Court of Appeals did not err when it
affirmed in toto the judgment of the RTC-Branch 3 which
declared, among other things, that (a) Vidal is the sole
surviving heir of Doa Demetria, who alone has rights to and
interest in the subject parcels of land; (b) AZIMUTH is Vidals
successor-in-interest to portions of the said properties in
accordance with the 1998 Memorandum of Agreement and
2004 Deed of Conditional Conveyance; (c) Teofilo is not the
son or heir of Doa Demetria; and (d) Teofilo, Atty. Cabildo, and
their transferees/assignees, including LANDTRADE, have no
valid right to or interest in the same properties.
The Ejectment or Unlawful Detainer Case
(G.R. Nos. 170505, 173355-56, and 173563-64)
The Petitions in G.R. Nos. 170505, 173355-56, and 173563-64
all concern the execution pending appeal of the Decision
dated February 17, 2004 of the MTCC in Civil Case No.
11475-AF, which ordered NAPOCOR and TRANSCO to
vacate the two parcels of land in question, as well as to pay
rent for the time they occupied said properties.
LANDTRADE filed its Petition for Review in G.R. No.
170505 when it failed to have the MTCC Decision dated
February 17, 2004 executed while Civil Case No. 6613, the
appeal of the same judgment by NAPOCOR and TRANSCO,
was still pending before the RTC-Branch 5.
NAPOCOR and TRANSCO sought recourse from this
Court through their Petitions for Certiorari and Prohibition
in G.R. Nos. 173355-56 and 173563-64 after the RTC-Branch
1 (to which Civil Case No. 6613 was re-raffled) already
rendered a Decision dated December 12, 2005 in Civil Case
No. 6613, affirming the MTCC Decision dated February 17,
2004. Expectedly, NAPOCOR and TRANSCO appealed the
judgment of the RTC-Branch 1 to the Court of Appeals. The
Court of Appeals granted the motion for execution pending
appeal of LANDTRADE, and denied the application for
preliminary injunction of NAPOCOR and TRANSCO.
The
requirements of
posting a judgment; how to stay same. If judgment is
supersedeas
bond and
depositing rent
to stay execution
The pivotal issue in G.R. No. 170505 is whether
LANDTRADE is entitled to the execution of the MTCC
Decision dated February 17, 2004 even while said judgment
was then pending appeal before the RTC-Branch 5. The RTC-
Branch 5 granted the motion for immediate execution pending
appeal of LANDTRADE because of the failure of NAPOCOR
and TRANSCO to comply with the requirements for staying the
execution of the MTCC judgment, as provided in Rule 70,
Section 19 of the Rules of Court. The Court of Appeals
subsequently found grave abuse of discretion on the part of
RTC-Branch 5 in issuing the Order dated August 9, 2004
which granted execution pending appeal and the Writ of
Execution Pending Appeal dated August 10, 2004; and on the
part of Sheriff Borres, in issuing the Notices of Garnishment
and Notification to vacate, all dated August 11,
2004. According to the appellate court, NAPOCOR and
TRANSCO are exempt from the requirements of filing
a supersedeas bond and depositing rent in order to stay the
execution of the MTCC judgment.
Rule 70, Section 19 of the Rules of Court lays down the
requirements for staying the immediate execution of the MTCC
judgment against the defendant in an ejectment suit:
SEC. 19. Immediate execution of
rendered against the defendant, execution shall
issue immediately upon motion, unless
an appeal has been perfected and the
defendant to stay execution files a sufficient
supersedeas bond, approved by the Municipal
Trial Court and executed in favor of the plaintiff
to pay the rents, damages, and costs accruing
down to the time of the judgment appealed
from, and unless, during the pendency of the
appeal, he deposits with the appellate court
the amount of rent due from time to
time under the contract, if any, as determined
by the judgment of the Municipal Trial Court. In
the absence of a contract, he shall deposit with
the Regional Trial Court the reasonable value of
the use and occupation of the premises for the
preceding month or period at the rate
determined by the judgment of the lower court
on or before the tenth day of each succeeding
month or period. The supersedeas bond shall
be transmitted by the Municipal Trial Court, with
the other papers, to the clerk of the Regional
Trial Court to which the action is appealed.
All amounts so paid to the appellate
court shall be deposited with said court or
authorized government depositary bank, and
shall be held there until the final disposition of
 the appeal, unless the court, by agreement of
the interested parties, or in the absence of
reasonable grounds of opposition to a motion to
withdraw, or for justifiable reasons, shall decree
otherwise. Should the defendant fail to make
the payments above prescribed from time to
time during the pendency of the appeal, the
appellate court, upon motion of the plaintiff, and
upon proof of such failure, shall order the
execution of the judgment appealed from with
respect to the restoration of possession, but
such execution shall not be a bar to the appeal
taking its course until the final disposition
thereof on the merits.
After the case is decided by the
Regional Trial Court, any money paid to the
court by the defendant for purposes of the stay
of execution shall be disposed of in accordance
with the provisions of the judgment of the
Regional Trial Court. In any case wherein it
appears that the defendant has been deprived
of the lawful possession of land or building
pending the appeal by virtue of the execution of
the judgment of the Municipal Trial Court,
damages for such deprivation of possession
and restoration of possession may be allowed
the defendant in the judgment of the Regional
Trial Court disposing of the appeal. (Emphases
supplied.)
The Court had previously recognized the exemption of
NAPOCOR from filing a supersedeas bond. The Court stated
in Philippine Geothermal, Inc. v. Commissioner of Internal
Revenue[122] that a chronological review of the NAPOCOR
Charter will show that it has been the lawmakers intention that
said corporation be completely exempt not only from all forms
of taxes, but also from filing fees, appeal bonds,
and supersedeas bonds in any court or administrative
proceedings. The Court traced the history of the NAPOCOR
Charter, thus:
Republic Act No. 6395 (10 September
1971) enumerated the details covered by the
exemptions by stating under Sec. 13 that The
Corporation shall be non-profit and shall devote
all its returns from its capital investment, as well
as excess revenues from its operation, for
expansionthe Corporation is hereby declared
exempt from the payment of all taxes, duties,
fees, imposts, charges, costs and service fees
in any court or administrative proceedings in
which it may be a party, restrictions and duties
to the Republic of the Philippines, its provinces,
cities, municipalities and other government
agencies and instrumentalities . .
. Subsequently, Presidential Decree No.
380 (22 January 1974), Sec. 10 made even
more specific the details of the exemption of
NPC to cover, among others, both direct and
indirect taxes on all petroleum products used in
its operation. Presidential Decree No. 938 (27
May 1976), Sec. 13 amended the tax exemption
by simplifying the same law in general terms. It
succinctly exempts service fees, including filing
fees, appeal bonds, supersedeas bonds, in any
court or administrative proceedings. The use of
 the phrase all forms of taxes demonstrate the
intention of the law to give NPC all the
exemption it has been enjoying before. The
rationale for this exemption is that being non-
profit, the NPC shall devote all its return from its
capital investment as well as excess revenues
from its operation, for
expansion.[123] (Emphases supplied.)
As presently worded, Section 13 of Republic Act No.
6395, the NAPOCOR Charter, as amended, reads:
SEC. 13. Non-profit Character of the
Corporation; Exemption from All Taxes, Duties,
Fees, Imposts and Other Charges by the
Government and Government Instrumentalities.
The Corporation shall be non-profit and shall
devote all its returns from its capital investment
as well as excess revenues from its operation,
for expansion. To enable the Corporation to pay
its indebtedness and obligations and in
furtherance and effective implementation of the
policy enunciated in Section One of this Act, the
Corporation, including its subsidiaries, is hereby
declared exempt from the payment of all forms
of taxes, duties, fees, imposts as well as costs
and service fees including filing fees, appeal
bonds, supersedeas bonds, in any court or
administrative proceedings. (Emphasis
supplied.)
In A.M. No. 05-10-20-SC, captioned In Re: Exemption
of the National Power Corporation from Payment of
Filing/Docket Fees, the Court addressed the query of a Clerk
of Court from the RTC of Urdaneta, Pangasinan on whether
NAPOCOR is exempt from the payment of filing fees and
Sheriffs Trust Fund. In its Resolution dated December 6, 2005,
the Court, upon the recommendation of the Court
Administrator, declared that NAPOCOR is still exempt from the
payment of filing fees, appeal bonds, and supersedeas bonds.
Consistent with the foregoing, the Court of Appeals
rendered its Decision dated November 23, 2005 in CA-G.R.
SP Nos. 85714 and 85841 declaring that NAPOCOR was
exempt from filing a supersedeas bond to stay the execution of
the MTCC judgment while the same was pending appeal
before the RTC-Branch 5. The appellate court also held that
the exemption of NAPOCOR extended even to the
requirement for periodical deposit of rent, ratiocinating that:
On the whole, the posting
of supersedeas bond and the making of the
periodical deposit are designed primarily to
insure that the plaintiff would be paid the back
rentals and the compensation for the use and
occupation of the premises should the municipal
trial courts decision be eventually affirmed on
appeal. Elsewise stated, both the posting of the
supersedeas bond and the payment of monthly
deposit are required to accomplish one and the
same purpose, namely, to secure the
performance of, or to satisfy the judgment
appealed from in case it is affirmed on appeal
by the appellate court.
 xxxx
Thus viewed, the inescapable
conclusion is, and so We hold, that although the
term making of monthly deposit in ejectment
cases is not expressly or specifically mentioned
in Section 13 of R.A. 6395, however, inasmuch
as it has the same or similar function, purpose,
and essence as a supersedeas bond, it should
be deemed included in the enumeration laid
down under the said provision. This accords
well with the principle of ejusdem generis which
says that where a statute uses a general word
followed by an enumeration of specific words
embraced within the general word merely as
examples, the enumeration does not restrict the
meaning of the general word which should be
construed to include others of the same class
although not enumerated therein; or where a
general word or phrase follows an enumeration
of particular and specific words of the same
class or where the latter follow the former, the
general word or phrase is to be construed to
include persons, things or cases akin to,
resembling, or of the same kind or class as
those specifically mentioned.
In a nutshell, We hold that petitioner
NAPOCOR enjoys exemption not only from
posting supersedeas bond in courts in appealed
ejectment cases, but also from periodically
depositing the amount of the monthly rental or
the reasonable compensation of the use and
occupancy of the property, as determined in the
municipal trial courts decision.[124]
The Court of Appeals further adjudged that the
exemptions of NAPOCOR similarly applied to TRANSCO
since [i]t is all too obvious that the interests of NAPOCOR and
TRANSCO over the premises in litigation are so interwoven
and dependent upon each other, such that whatever is
adjudged in regard to the former, whether favorable or
adverse, would ineluctably and similarly affect the latter[;] and
[c]onsequently, x x x the stay of the execution of the appealed
decision insofar as NAPOCOR is concerned necessarily
extends and inures to its co-defendant TRANSCO, not by
virtue of the formers statutory exemption privilege from filing
supersedeas bond and making periodic deposits, but by the
indisputably operative fact that the rights and liabilities in litis of
BOTH defendants are so intimately interwoven,
interdependent, and indivisible.[125]
Only recently, however, the Court reversed its stance
on the exemption of NAPOCOR from filing fees, appeal bonds,
and supersedeas bonds. Revisiting A.M. No. 05-10-20-SC, the
Court issued Resolutions dated October 27, 2009 and March
10, 2010, wherein it denied the request of NAPOCOR for
exemption from payment of filing fees and court fees for such
request appears to run counter to Article VIII, Section
5(5)[126] of the Constitution, on the rule-making power of the
Supreme Court over the rules on pleading, practice and
procedure in all courts, which includes the sole power to fix the
filing fees of cases in courts. The Court categorically
pronounced that NAPOCOR can no longer invoke its amended
Charter as basis for exemption from the payment of legal
fees.

Nevertheless, in this case, the RTC-Branch 1 already
promulgated its Decision in Civil Case No. 6613 on December
12, 2005, denying the appeal of NAPOCOR and TRANSCO
and affirming the MTCC judgment against said
corporations. NAPOCOR and TRANSCO presently have
pending appeals of the RTC-Branch 1 judgment before the
Court of Appeals.
Rule 70, Section 19 of the Rules of Court applies only
when the judgment of a Municipal Trial Court (and any same
level court such as the MTCC) in an ejectment case is pending
appeal before the RTC. When the RTC had already resolved
the appeal and its judgment, in turn, is pending appeal before
the Court of Appeals, then Rule 70, Section 21 of the Rules of
Court governs.
The Court already pointed out in Northcastle Properties
and Estate Corporation v. Paas[127] that Section 19 applies only
to ejectment cases pending appeal with the RTC, and Section
21 to those already decided by the RTC. The Court again held
in Uy v. Santiago[128] that:
[I]t is only execution of the Metropolitan or
Municipal Trial Courts judgment pending appeal
with the Regional Trial Court which may be
stayed by a compliance with the requisites
provided in Rule 70, Section 19 of the 1997
Rules on Civil Procedure. On the other hand,
once the Regional Trial Court has rendered a
decision in its appellate jurisdiction, such
decision shall, under Rule 70, Section 21 of
the 1997 Rules on Civil Procedure, be
immediately executory, without prejudice to an
appeal, via a Petition for Review, before the
Court of Appeals and/or Supreme Court.
(Emphases supplied.)
According to Rule 70, Section 21 of the Rules of Court,
[t]he judgment of the Regional Trial Court against the
defendant shall be immediately executory, without prejudice to
a further appeal that may be taken therefrom. It no longer
provides for the stay of execution at such stage.
Thus, subsequent events have rendered the Petition of
LANDTRADE in G.R. No. 170505 moot and academic. It will
serve no more purpose for the Court to require NAPOCOR
and TRANSCO to still comply with the requirements of filing
a supersedeas bond and depositing rent to stay execution
pending appeal of the MTCC judgment, as required by Rule
70, Section 19 of the Rules of Court, when the appeal had
since been resolved by the RTC.
Preliminary
injunction to
stay execution of
RTC judgment
against
defendant in an
ejectment case
The issues raised by NAPOCOR and TRANSCO in
their Petitions in G.R. Nos. 173355-56 and 173563-64 boil
down to the sole issue of whether the Court of Appeals
committed grave abuse of discretion amounting to lack or
excess of jurisdiction in refusing to enjoin the execution of the
Decision dated December 12, 2005 of the RTC-Branch 1 in
Civil Case No. 6613 while the same is pending appeal before
the appellate court.
The Court of Appeals granted the issuance of a writ of
execution in favor of LANDTRADE and denied the application
for writ of preliminary injunction of NAPOCOR and TRANSCO
because Rule 70, Section 21 of the Rules of Court explicitly
provides that the RTC judgment in an ejectment case, which is
adverse to the defendant and pending appeal before the Court
of Appeals, shall be immediately executory and can be
enforced despite further appeal.Therefore, the execution of the
RTC judgment pending appeal is the ministerial duty of the
Court of Appeals, specifically enjoined by law to be done.
NAPOCOR and TRANSCO argue that neither the rules
nor jurisprudence explicitly declare that Rule 70, Section 21 of
the Rules of Court bars the application of Rule 58 on
preliminary injunction. Regardless of the immediately
executory character of the RTC judgment in an ejectment
case, the Court of Appeals, before which said judgment is
appealed, is not deprived of power and jurisdiction to issue a
writ of preliminary injunction when circumstances so warrant.
There is merit in the present Petitions of NAPOCOR
and TRANSCO.
The Court expounded on the nature of a writ of
preliminary injunction in Levi Strauss & Co. v. Clinton
Apparelle, Inc. [129]:
Section 1, Rule 58 of the Rules of Court
defines a preliminary injunction as an order
granted at any stage of an action prior to the
judgment or final order requiring a party or a
court, agency or a person to refrain from a
particular act or acts. Injunction is accepted as
the strong arm of equity or a transcendent
remedy to be used cautiously as it affects the
respective rights of the parties, and only upon
full conviction on the part of the court of its
extreme necessity. An extraordinary remedy,
injunction is designed to preserve or maintain
the status quo of things and is generally availed
of to prevent actual or threatened acts until the
merits of the case can be heard. It may be
resorted to only by a litigant for the preservation
or protection of his rights or interests and for no
other purpose during the pendency of the
principal action. It is resorted to only when there
is a pressing necessity to avoid injurious
consequences, which cannot be remedied
under any standard compensation. The
resolution of an application for a writ of
preliminary injunction rests upon the existence
of an emergency or of a special recourse before
the main case can be heard in due course of
proceedings.
Section 3, Rule 58, of the Rules of Court
enumerates the grounds for the issuance of a
preliminary injunction:
SEC. 3. Grounds for issuance of
preliminary injunction. A
preliminary injunction may be
granted when it is established:
 (a) That the applicant is
entitled to the relief demanded,
and the whole or part of such
relief consists in restraining the
commission or continuance of
the act or acts complained of, or
in requiring the performance of
an act or acts, either for a limited
period or perpetually;
(b) That the commission,
continuance, or non-
performance of the act or acts
complained of during the
litigation would probably work
injustice to the applicant; or
(c) That a party, court,
agency or a person is doing,
threatening, or is attempting to
do, or is procuring or suffering to
be done, some act or acts
probably in violation of the rights
of the applicant respecting the
subject of the action or
proceeding, and tending to
render the judgment ineffectual.
Under the cited provision, a clear and
positive right especially calling for judicial
protection must be shown. Injunction is not a
remedy to protect or enforce contingent,
abstract, or future rights; it will not issue to
protect a right not in esse and which may never
arise, or to restrain an act which does not give
rise to a cause of action. There must exist an
actual right. There must be a patent showing by
the complaint that there exists a right to be
protected and that the acts against which the
writ is to be directed are violative of said right.
Benedicto v. Court of Appeals[130] sets forth the
following elucidation on the applicability of Rule 58 vis--vis
Rule 70, Section 21 of the Rules of Court:
This section [Rule 70, Section 21]
presupposes that the defendant in a forcible
entry or unlawful detainer case is unsatisfied
with the judgment of the Regional Trial Court
and decides to appeal to a superior court. It
authorizes the RTC to immediately issue a writ
of execution without prejudice to the appeal
taking its due course. It is our opinion that on
appeal the appellate court may stay the said
writ should circumstances so require.
In the case of Amagan v. Marayag, we
reiterated our pronouncement in Vda. de
Legaspi v. Avendao that the proceedings in an
ejectment case may be suspended in whatever
stage it may be found. We further drew a fine
line between forcible entry and unlawful
detainer, thus:
Where the action, therefore, is
one of illegal detainer, as
distinguished from one of forcible
entry, and the right of the plaintiff
to recover the premises is
 seriously placed in issue in a
proper judicial proceeding, it is
more equitable and just and less
productive of confusion and
disturbance of physical
possession, with all its
concomitant inconvenience and
expenses. For the Court in
which the issue of legal
possession, whether involving
ownership or not, is brought to
restrain, should a petition for
preliminary injunction be filed
with it, the effects of any order or
decision in the unlawful detainer
case in order to await the final
judgment in the more substantive
case involving legal possession
or ownership. It is only where
there has been forcible entry that
as a matter of public policy the
right to physical possession
should be immediately set at rest
in favor of the prior possession
regardless of the fact that the
other party might ultimately be
found to have superior claim to
the premises involved thereby to
discourage any attempt to
recover possession thru force,
strategy or stealth and without
resorting to the courts.
Patently, even if RTC judgments in
unlawful detainer cases are immediately
executory, preliminary injunction may still
be granted. There need only be clear
showing that there exists a right to be
protected and that the acts against which
the writ is to be directed violate said
right. (Emphasis supplied.)
As in Benedicto, substantial considerations exist herein that
compels the Court to issue a writ of preliminary injunction
enjoining the execution of the February 17, 2004 Decision of
the MTCC, as affirmed by the December 12, 2005 Decision of
the RTC-Branch 1, until the appeal of latter judgment, sought
by NAPOCOR and TRANSCO, is finally resolved by the Court
of Appeals.
First, the two parcels of land claimed by LANDTRADE are the
subject of several other cases. In fact, Vidal and AZIMUTH,
who instituted the Quieting of Title Case against Teofilo and
LANDTRADE (also presently before the Court in G.R. Nos.
178779 and 178894) have filed a Motion For Leave to
Intervene in the instant case, thus, showing that there are
other parties who, while strangers to the ejectment case, might
be greatly affected by its result and who want to protect their
interest in the subject properties. And although cases involving
title to real property, i.e., quieting of title, accion
publiciana, etc., are not prejudicial to and do not suspend an
ejectment case,[131] the existence of such cases should have
already put the Court of Appeals on guard that the title of
LANDTRADE to the subject properties on which it
fundamentally based its claim of possessory right is being
fiercely contested.
 Second, it is undisputed that TRANSCO and its
predecessor, NAPOCOR, have been in possession of the
disputed parcels of land for more than 40 years.Upon said
properties stand the TRANSCO Overton Sub-station and Agus
7 Warehouse. The Overton Sub-station, in particular, is a
crucial facility responsible for providing the power
requirements of a large portion of Iligan City, the two Lanao
Provinces, and other nearby provinces. Without doubt, having
TRANSCO vacate its Overton Sub-station, by prematurely
executing the MTCC judgment of February 17, 2004, carries
serious and irreversible implications, primordial of which is the
widespread disruption of the electrical power supply in the
aforementioned areas, contributing further to the electric
power crisis already plaguing much of Mindanao.
Lastly, allowing execution pending appeal would result
in the payment of an astronomical amount in rentals which, per
Sheriff Borress computation, already amounted
to P156,000,000.00 by August 11, 2004, when he issued the
Notices of Garnishment and Notification against NAPOCOR
and TRANSCO; plus, P500,000.0 each month
thereafter. Payment of such an amount may seriously put the
operation of a public utility in peril, to the detriment of its
consumers.
These circumstances altogether present a pressing
necessity to avoid injurious consequences, not just to
NAPOCOR and TRANSCO, but to a substantial fraction of the
consuming public as well, which cannot be remedied under
any standard compensation. The issuance by the Court of
Appeals of a writ of preliminary injunction is justified by the
circumstances.
The Court must emphasize though that in so far as the
Ejectment Case is concerned, it has only settled herein issues
on the propriety of enjoining the execution of the MTCC
Decision dated February 17, 2004 while it was on appeal
before the RTC, and subsequently, before the Court of
Appeals. The Court of Appeals has yet to render a judgment
on the appeal itself. But it may not be amiss for the Court to
also point out that in G.R. Nos. 178779 and 178894 (Quieting
of Title Case), it has already found that Vidal, not Teofilo, is
the late Doa Demetrias sole heir, who alone inherits Doa
Demetrias rights to and interests in the disputed parcels of
land. This conclusion of the Court in the Quieting of Title Case
will inevitably affect the Ejectment Case still pending appeal
before the Court of Appeals since LANDTRADE is basing its
right to possession in the Ejectment Case on its supposed title
to the subject properties, which it derived from Teofilo.
The Cancellation of Titles and Reversion Case
(G.R. No. 173401)
The Republic is assailing in its Petition in G.R. No. 173401 the
(1) Order dated December 13, 2005 of the RTC-Branch 4
dismissing Civil Case No. 6686, the Complaint for Cancellation
of Titles and Reversion filed by the Republic against the
deceased Doa Demetria, Vidal and/or Teofilo, and AZIMUTH
and/or LANDTRADE; and (2) Order dated May 16, 2006 of the
same trial court denying the Motion for Reconsideration of the
Republic, averring that:
With due respect, the trial court decided
a question of substance contrary to law and
jurisprudence in ruling:
(i) THAT PETITIONER HAD NO
CAUSE OF ACTION IN
 INSTITUTING THE
SUBJECT COMPLAINT
FOR CANCELLATION The Court finds merit in the present Petition.
OF OCT NOS. 0-1200
(A.F.) AND 0-1201 (A.F.), Cause of action for reversion
INCLUDING ALL
DERIVATIVE TITLES, The Complaint in Civil Case No. 6686 seeks the cancellation
AND REVERSION. of OCT Nos. 0-1200 (a.f.) and 0-1201 (a.f.), with all their
derivative titles, and reversion. The Complaint was dismissed
(ii) THAT PETITIONERS by the RTC-Branch 4 in its Order dated December 13, 2005,
COMPLAINT FOR upon Motion of Vidal and AZIMUTH, on the ground that the
CANCELLATION OF State does not have a cause of action for reversion. According
OCT NOS. 0-1200 (A.F.) to the RTC-Branch 4, there was no showing that the late Doa
AND 0-1201 (A.F.) Demetria committed any wrongful act or omission in violation
INCLUDING ALL of any right of the Republic. Additionally, the Regalian doctrine
DERIVATIVE TITLES, does not apply to Civil Case No. 6686 because said doctrine
AND REVERSION IS does not extend to lands beyond the public domain. By the
BARRED BY THE own judicial admission of the Republic, the two parcels of land
DECISIONS IN CACHO in question are privately owned, even before the same were
VS GOVERNMENT OF registered in Doa Demetrias name.
THE UNITED STATES
(28 PHIL. 616 [1914] The Court disagrees.
AND CACHO VS COURT
OF APPEALS (269 Rule 2, Section 2 of the Rules of Court defines a cause of
SCRA 159 [1997]. action as the act or omission by which a party violates a right
of another. Its essential elements are the following: (1) a right
(iii) THAT PETITIONERS in favor of the plaintiff; (2) an obligation on the part of the
CAUSE OF ACTION named defendant to respect or not to violate such right; and
HAS PRESCRIBED; (3) such defendants act or omission that is violative of the right
AND of the plaintiff or constituting a breach of the obligation of the
former to the latter.[133]
(iv) THAT PETITIONER IS
GUILTY OF FORUM Reversion is an action where the ultimate relief sought is to
SHOPPING.[132] revert the land back to the government under the Regalian
doctrine. Considering that the land subject of the action
originated from a grant by the government, its cancellation is a
matter between the grantor and the grantee.[134] In Estate of
the Late Jesus S. Yujuico v. Republic[135] (Yujuico case),
reversion was defined as an action which seeks to restore
public land fraudulently awarded and disposed of to private
individuals or corporations to the mass of public domain. It
bears to point out, though, that the Court also allowed the
resort by the Government to actions for reversion to cancel
titles that were void for reasons other than fraud, i.e., violation
by the grantee of a patent of the conditions imposed by
law;[136]and lack of jurisdiction of the Director of Lands to grant
a patent covering inalienable forest land[137] or portion of a
river, even when such grant was made through mere
oversight.[138] In Republic v. Guerrero,[139] the Court gave a
more general statement that the remedy of reversion can be
availed of only in cases of fraudulent or unlawful
inclusion of the land in patents or certificates of title.
The right of the Republic to institute an action for
reversion is rooted in the Regalian doctrine. Under
the Regalian doctrine, all lands of the public domain belong
to the State, and that the State is the source of any asserted
right to ownership in land and charged with the conservation of
such patrimony. This same doctrine also states that all lands
not otherwise appearing to be clearly within private ownership
are presumed to belong to the State.[140] It is incorporated in
the 1987 Philippine Constitution under Article XII, Section 2
which declares [a]ll lands of the public domain, waters,
minerals, coal, petroleum, and other mineral oils, all forces of
potential energy, fisheries, forests or timber, wildlife, flora and
fauna, and other natural resources are owned by the State. x x
x No public land can be acquired by private persons without
any grant, express or implied, from the government; it is
indispensable that there be a showing of the title from the
State.[141]
The reversion case of the Republic in Civil Case No.
6686 rests on the main argument that OCT Nos. 0-1200 (a.f.)
and 0-1201 (a.f.), issued in Doa Demetrias name, included
parcels of lands which were not adjudicated to her by the
Court in the 1914 Cacho case. Contrary to the statement
made by the RTC-Branch 4 in its December 13, 2005 Order,
the Republic does not make any admission in its Complaint
that the two parcels of land registered in Doa Demetrias name
were privately owned even prior to their registration. While the
Republic does not dispute that that two parcels of land were
awarded to Doa Demetria in the 1914 Cacho case, it alleges
that these were not the same as those covered by OCT Nos.
0-1200 (a.f.) and 0-1201 (a.f.) issued in Doa Demetrias name
84 years later. If, indeed, the parcels of land covered by said
OCTs were not those granted to Doa Demetria in the 1914
Cacho case, then it can be presumed, under the Regalian
doctrine, that said properties still form part of the public
domain belonging to the State.
Just because OCTs were already issued in Doa
Demetrias name does not bar the Republic from instituting an
action for reversion. Indeed, the Court made it clear
in Francisco v. Rodriguez[142] that Section 101 of the Public
Land Act may be invoked only when title has already vested in
the individual, e.g., when a patent or a certificate of title has
already been issued[,] for the basic premise in an action for
reversion is that the certificate of title fraudulently or unlawfully
included land of the public domain, hence, calling for the
cancellation of said certificate. It is actually the issuance of
such a certificate of title which constitutes the third element of
a cause of action for reversion.

The Court further finds that the Complaint of the
Republic in Civil Case No. 6686 sufficiently states a cause of
action for reversion, even though it does not allege that fraud
was committed in the registration or that the Director of Lands
requested the reversion.
It is a well-settled rule that the existence of a cause of
action is determined by the allegations in the complaint. In the
resolution of a motion to dismiss based on failure to state a
cause of action, only the facts alleged in the complaint must be
considered. The test in cases like these is whether a court can
render a valid judgment on the complaint based upon the facts
alleged and pursuant to the prayer therein. Hence, it has been
held that a motion to dismiss generally partakes of the nature
of a demurrer which hypothetically admits the truth of the
factual allegations made in a complaint.[143] The hypothetical
admission extends to the relevant and material facts well
pleaded in the complaint and inferences fairly deducible
therefrom. Hence, if the allegations in the complaint furnish
sufficient basis by which the complaint can be maintained, the
same should not be dismissed regardless of the defense that
may be assessed by the defendants.[144]
In Vergara v. Court of Appeals,[145] the Court
additionally explained that:
In determining whether allegations of a
complaint are sufficient to support a cause of
action, it must be borne in mind that the
complaint does not have to establish or allege
facts proving the existence of a cause of action
at the outset; this will have to be done at the
trial on the merits of the case. To sustain a
motion to dismiss for lack of cause of action, the
complaint must show that the claim for relief
does not exist, rather than that a claim has
been defectively stated, or is ambiguous,
indefinite or uncertain.
The Republic meticulously presented in its Complaint
the discrepancies between the 1914 Cacho case, on one
hand, which granted Doa Demetria title to two parcels of land;
and OCT Nos. 0-1200 (a.f.) and 0-1201 (a.f.), on the other,
which were supposedly issued pursuant to the said case. In
paragraphs 9 and 16 of its Complaint, the Republic clearly
alleged that OCT Nos. 0-1200 (a.f.) and 0-1201 (a.f.) cover
properties much larger than or areas beyond those granted by
the land registration court in GLRO Record Nos. 6908 and
6909. Thus, the Republic was able to satisfactorily allege the
unlawful inclusion, for lack of an explicit grant from the
Government, of parcels of public land into Doa Demetrias
OCTs, which, if true, will justify the cancellation of said
certificates and the return of the properties to the Republic.
That the Complaint in Civil Case No. 6686 does not
allege that it had been filed by the Office of the Solicitor
General (OSG), at the behest of the Director of Lands, does
not call for its dismissal on the ground of failure to state a
cause of action. Section 101 of Commonwealth Act No. 141,
otherwise known as the Public Land Act, as amended, simply
requires that:
SEC. 101. All actions for the reversion to
the Government of lands of the public domain
or improvements thereon shall be instituted by
the Solicitor General or the officer acting in
 his stead, in the proper courts, in the name
of the Republic of the Philippines. (Emphasis
supplied.)
Clear from the aforequoted provision that the authority
to institute an action for reversion, on behalf of the Republic, is
primarily conferred upon the OSG. While the OSG, for most of
the time, will file an action for reversion upon the request or
recommendation of the Director of Lands, there is no basis for
saying that the former is absolutely bound or dependent on the
latter.
RTC-Branch 4 cited Sherwill Development Corporation
v. Sitio Nio Residents Association, Inc. [146] (Sherwill case), to
support its ruling that it is absolutely necessary that an
investigation and a determination of fraud should have been
made by the Director of Lands prior to the filing of a case for
reversion. The Sherwill case is not in point and does not
constitute a precedent for the case at bar. It does not even
involve a reversion case. The main issue therein was whether
the trial court properly dismissed the complaint of Sherwill
Development Corporation for quieting of title to two parcels of
land, considering that a case for the declaration of nullity of its
TCTs, instituted by the Sto. Nio Residents Association, Inc.,
was already pending before the Land Management Bureau
(LMB). The Court recognized therein the primary jurisdiction of
the LMB over the dispute, and affirmed the dismissal of the
quieting of title case on the grounds of litis pendentia and
forum shopping.
Res judicata
Public policy and sound practice enshrine the
fundamental principle upon which the doctrine of res
judicata rests that parties ought not to be permitted to litigate
the same issues more than once. It is a general rule common
to all civilized system of jurisprudence, that the solemn and
deliberate sentence of the law, pronounced by its appointed
organs, upon a disputed fact or a state of facts, should be
regarded as a final and conclusive determination of the
question litigated, and should forever set the controversy at
rest. Indeed, it has been well said that this maxim is more than
a mere rule of law; more even than an important principle of
public policy; and that it is not too much to say that it is a
fundamental concept in the organization of every jural
system. Public policy and sound practice demand that, at the
risk of occasional errors, judgments of courts should become
final at some definite date fixed by law. The very object for
which courts were constituted was to put an end to
controversies.[147]
The doctrine of res judicata comprehends two distinct
concepts - (1) bar by former judgment, and (2) conclusiveness
of judgment. For res judicata to serve as an absolute bar to a
subsequent action, the following requisites must concur: (1)
the former judgment or order must be final; (2) the judgment or
order must be on the merits; (3) it must have been rendered by
a court having jurisdiction over the subject matter and parties;
and (4) there must be between the first and second actions,
identity of parties, of subject matter, and of causes of
action. When there is no identity of causes of action, but only
an identity of issues, there exists res judicata in the concept of
conclusiveness of judgment. Although it does not have the
same effect as res judicata in the form of bar by former
judgment which prohibits the prosecution of a second action
upon the same claim, demand, or cause of action, the rule on
conclusiveness of judgment bars the relitigation of particular
facts or issues in another litigation between the same parties
on a different claim or cause of action.[148]
The 1914 Cacho case does not bar the Complaint for
reversion in Civil Case No. 6686 by res judicata in either of its
two concepts.
There is no bar by prior judgment because the 1914
Cacho case and Civil Case No. 6686 do not have the same
causes of action and, even possibly, they do not involve
identical subject matters.
Land registration cases, such as GLRO Record Nos.
6908 and 6909, from which the 1914 Cacho case arose, are
special proceedings where the concept of a cause of action in
ordinary civil actions does not apply. In special proceedings,
the purpose is to establish a status, condition or fact; in land
registration proceedings, the ownership by a person of a
parcel of land is sought to be established.[149] Civil Case No.
6686 is an action for reversion where the cause of action is the
alleged unlawful inclusion in OCT Nos. 0-1200 (a.f.) and 0-
1201 (a.f.) of parcels of public land that were not among those
granted to Doa Demetria in the 1914 Cacho case. Thus, Civil
Case No. 6686 even rests on supposition that the parcels of
land covered by the certificates of title in Doa Demetrias name,
which the Republic is seeking to have cancelled, are different
from the parcels of land that were the subject matter of
the 1914 Cacho caseand adjudged to Doa Demetria.
Res judicata in the concept of conclusiveness of
judgment, likewise, does not apply as between the 1914
Cacho case and Civil Case No. 6686. A careful study of the
Complaint in Civil Case No. 6686 reveals that the Republic
does not seek to re-litigate any of the issues resolved in
the 1914 Cacho case. The Republic no longer questions in
Civil Case No. 6686 that Doa Demetria was adjudged the
owner of two parcels of land in the 1914 Cacho case. The
Republic is only insisting on the strict adherence to the
judgment of the Court in the 1914 Cacho case, particularly: (1)
the adjudication of a smaller parcel of land, consisting only of
the southern portion of the 37.87-hectare Lot 2 subject of Doa
Demetrias application in GLRO Record No. 6909; and (2) the
submission of a new technical plan for the adjudicated
southern portion of Lot 2 in GLRO Record No. 6909, and the
deed executed by Datto Darondon, husband of Alanga,
renouncing all his rights to Lot 1, in GLRO Record No. 6908, in
Doa Demetrias favor.[150]
Similarly, the 1997 Cacho case is not an obstacle to
the institution by the Republic of Civil Case No. 6686 on the
ground of res judicata.
Bar by prior judgment does not apply for lack of identity of
causes of action between the 1997 Cacho case and Civil Case
No. 6686. The 1997 Cacho caseinvolves a petition for re-
issuance of decrees of registration. In the absence of
principles and rules specific for such a petition, the Court
refers to those on reconstitution of certificates of title, being
almost of the same nature and granting closely similar reliefs.
Reconstitution denotes a restoration of the instrument
which is supposed to have been lost or destroyed in its original
form or condition. The purpose of the reconstitution of title or
any document is to have the same reproduced, after observing
the procedure prescribed by law, in the same form they were
when the loss or destruction occurred.[151] Reconstitution is
another special proceeding where the concept of cause of
action in an ordinary civil action finds no application.
The Court, in the 1997 Cacho case, granted the
reconstitution and re-issuance of the decrees of registration
considering that the NALTDRA, through then Acting
Commissioner Santiago M. Kapunan,[152] its Deputy Clerk of
Court III, the Head Geodetic Engineer, and the Chief of
Registration, certified that according to the Record Book of
Decrees for Ordinary Land Registration Case, Decree No.
18969 was issued in GLRO Record No. 6909 and Decree No.
10364 was issued in GLRO Record No. 6908[;][153] thus,
leaving no doubt that said decrees had in fact been issued.
The 1997 Cacho case only settled the issuance, existence,
and subsequent loss of Decree Nos. 10364 and
18969. Consequently, said decrees could be re-issued in their
original form or condition. The Court, however, could not have
passed upon in the 1997 Cacho case the issues on whether
Doa Demetria truly owned the parcels of land covered by the
decrees and whether the decrees and the OCTs subsequently
issued pursuant thereto are void for unlawfully including land
of the public domain which were not awarded to Doa
Demetria.
The following pronouncement of the Court in Heirs of Susana
de Guzman Tuazon v. Court of Appeals[154] is instructive:
Precisely, in both species of reconstitution
under Section 109 of P.D. No. 1529 and R.A.
No. 26, the nature of the action denotes a
restoration of the instrument which is supposed
to have been lost or destroyed in its original
form and condition. The purpose of the action
is merely to have the same reproduced, after
proper proceedings, in the same form they
were when the loss or destruction occurred,
and does not pass upon the ownership of
the land covered by the lost or destroyed
title. It bears stressing at this point that
ownership should not be confused with a
certificate of title. Registering land under the
Torrens System does not create or vest title
because registration is not a mode of acquiring
ownership. A certificate of title is merely an
evidence of ownership or title over the particular
property described therein. Corollarily, any
question involving the issue of ownership
must be threshed out in a separate suit,
which is exactly what the private respondents
did when they filed Civil Case No. 95-3577
before Branch 74. The trial court will then
conduct a full-blown trial wherein the parties will
present their respective evidence on the issue
of ownership of the subject properties to enable
the court to resolve the said issue. x x x.
(Emphases supplied.)
Whatever findings the Court made on the issue of ownership
in the 1997 Cacho case are mere obiter dictum. As the Court
held in Amoroso v. Alegre, Jr.[155]:
Petitioner claims in his petition that the 3
October 1957 Decision resolved the issue of
ownership of the lots and declared in the body
of the decision that he had sufficiently proven
uncontroverted facts that he had been in
 possession of the land in question since 1946 x
x x [and] has been in possession of the property
with sufficient title. However, such findings
made by the CFI in the said decision are
mere obiter, since the ownership of the
properties, titles to which were sought to be
reconstituted, was never the issue in the
reconstitution case. Ownership is not the
issue in a petition for reconstitution of title.
A reconstitution of title does not pass upon
the ownership of the land covered by the
lost or destroyed title.
It may perhaps be argued that
ownership of the properties was put in issue
when petitioner opposed the petition for
reconstitution by claiming to be the owner of the
properties. However, any ruling that the trial
court may make on the matter is irrelevant
considering the courts limited authority in
petitions for reconstitution. In a petition for
reconstitution of title, the only relief sought is
the issuance of a reconstituted title because the
reconstituting officers power is limited to
granting or denying a reconstituted title. As
stated earlier, the reconstitution of title does not
pass upon the ownership of the land covered by
the lost or destroyed title, and any change in the
ownership of the property must be the subject
of a separate suit. (Emphases supplied.)
The Court concedes that the 1997 Cacho case, by
reason of conclusiveness of judgment, prevents the Republic
from again raising as issues in Civil Case No. 6686 the
issuance and existence of Decree Nos. 10364 and 18969, but
not the validity of said decrees, as well as the certificates of
title issued pursuant thereto.
Forum shopping
Forum shopping is the filing of multiple suits involving
the same parties for the same cause of action, either
simultaneously or successively, for the purpose of obtaining a
favorable judgment. A party violates the rule against forum
shopping if the elements of litis pendentia are present; or if a
final judgment in one case would amount to res judicata in the
other.[156]
There is forum shopping when the following elements
are present: (a) identity of parties, or at least such parties as
represent the same interests in both actions; (b) identity of
rights asserted and relief prayed for, the relief being founded
on the same facts; and (c) the identity of the two preceding
particulars, is such that any judgment rendered in the other
action will, regardless of which party is successful, amount
to res judicata in the action under consideration; said
requisites are also constitutive of the requisites for auter action
pendant or lis pendens.[157]
Given the preceding disquisition of the Court that
the 1914 and 1997 Cacho cases do not constitute res
judicata in Civil Case No. 6686, then the Court also cannot
sustain the dismissal by the RTC-Branch 4 of the Complaint of
the Republic in Civil Case No. 6686 for forum shopping.
Prescription
According to the RTC-Branch 4, the cause of action for
reversion of the Republic was already lost or extinguished by
prescription, citing Section 32 of the Property Registration
Decree, which provides:
SEC. 32. Review of decree of
registration; Innocent purchaser for value. The
decree of registration shall not be reopened or
revised by reason of absence, minority, or other
disability of any person adversely affected
thereby, nor by any proceeding in any court for
reversing judgment, subject, however, to the
right of any person, including the government
and the branches thereof, deprived of land or of
any estate or interest therein by such
adjudication or confirmation of title obtained by
actual fraud, to file in the proper Court of First
Instance a petition for reopening and review of
the decree of registration not later than one
year from and after the date of the entry of such
decree of registration, but in no case shall such
petition be entertained by the court where an
innocent purchaser for value has acquired the
land or an interest therein, whose rights may be
prejudiced. Whenever the phrase innocent
purchaser of value or an equivalent phrase
occurs in this Decree, it shall be deemed to
include an innocent lessee, mortgagee, or other
encumbrancer for value.
Upon the expiration of said period of one
year, the decree of registration and the
certificate of title issued shall become
incontrovertible. Any person aggrieved by such
decree of registration in any case may pursue
his remedy by action for damages against the
applicant or any other persons responsible for
the fraud.
Decree No. 10364 in GLRO Record No. 6908 was issued on
May 9, 1913, while Decree No. 18969 in GLRO Record No.
6909 was issued on July 8, 1915. In the course of eight
decades, the decrees were lost and subsequently
reconstituted per order of this Court in the 1997 Cacho
case. The reconstituted decrees were issued on October 15,
1998 and transcribed on OCT Nos. 0-1200 (a.f.) and 0-1201
(a.f.). The reconstituted decrees were finally entered into the
Registration Book for Iligan City on December 4, 1998 at 10:00
a.m. Almost six years had elapsed from entry of the decrees
by the time the Republic filed its Complaint in Civil Case No.
6686 on October 13, 2004.
Nonetheless, elementary is the rule that prescription
does not run against the State and its subdivisions. When the
government is the real party in interest, and it is proceeding
mainly to assert its own right to recover its own property, there
can as a rule be no defense grounded on laches or
prescription. Public land fraudulently included in patents or
certificates of title may be recovered or reverted to the State in
accordance with Section 101 of the Public Land Act. The right
of reversion or reconveyance to the State is not barred by
prescription.[158]
The Court discussed lengthily in Republic v. Court of
Appeals[159] the indefeasibility of a decree of
registration/certificate of title vis--vis the remedy of reversion
available to the State:
 consideration of
The petitioner invokes Republic v. the facts set forth
Animas, where this Court declared that a title in such statement,
founded on fraud may be cancelled and any
notwithstanding the lapse of one year from the subsequent
issuance thereof. Thus: modification,
alteration, or
x x x The change of the
misrepresentations of the material facts set
applicant that he had been forth in the
occupying and cultivating the application
land and residing thereon are shall ipso
sufficient grounds to nullify the facto produce the
grant of the patent and title under cancellation of the
Section 91 of the Public Land concession, title
Law which provides as follows: or permit
granted. x x x"
"The
statements made A certificate of title that is
in the application void may be ordered
shall be cancelled. A title will be
considered as considered void if it is procured
essential through fraud, as when a person
conditions or parts applies for registration of the
of any land under his name although
concession, title the property belongs to
or permit issued another. In the case of
on the basis of disposable public lands, failure
such application, on the part of the grantee to
and any false comply with the conditions
statement thereon imposed by law is a ground for
or omission of holding such title void. The
facts, changing, or lapse of the one year period
modifying the within which a decree of title may
 be reopened for fraud would not
prevent the cancellation thereof,
for to hold that a title may
become indefeasible by
registration, even if such title had
been secured through fraud or in
violation of the law, would be the
height of absurdity. Registration
should not be a shield of fraud in
securing title.
This doctrine was reiterated in Republic
v. Mina, where Justice Relova declared for the
Court:
A certificate of title that is
void may be ordered
cancelled. And, a title will be
considered void if it is procured
through fraud, as when a person
applies for registration of the
land on the claim that he has
been occupying and cultivating
it. In the case of disposable
public lands, failure on the part of
the grantee to comply with the
conditions imposed by law is a
ground for holding such title
void. x x x The lapse of one (1)
year period within which a
decree of title may be reopened
for fraud would not prevent the
cancellation thereof for to hold
that a title may become
indefeasible by registration, even
if such title had been secured
through fraud or in violation of
the law would be the height of
absurdity. Registration should
not be a shield of fraud in
securing title.
Justifying the above-quoted provision,
the Court declared in Piero, Jr. v. Director of
Lands:
It is true that under
Section 122 of the Land
Registration Act, a Torrens title
issued on the basis of a free
patent or a homestead patent is
as indefeasible as one judicially
secured. And in repeated
previous decisions of this Court
that indefeasibility has been
emphasized by Our holding that
not even the Government can file
an action for annulment, but at
the same time, it has been made
clear that an action for reversion
may be instituted by the Solicitor
General, in the name of the
Republic of the Philippines. It is
to the public interest that one
who succeeds in fraudulently
acquiring title to a public land
should not be allowed to
benefit therefrom, and the State
 should, therefore, have an even
existing authority, thru its duly
authorized officers, to inquire into
the circumstances surrounding
the issuance of any such title, to
the end that the Republic, thru
the Solicitor General or any other
officer who may be authorized by
law, may file the corresponding
action for the reversion of the
land involved to the public
domain, subject thereafter to
disposal to other qualified
persons in accordance with
law. In other words, the
indefeasibility of a title over land
previously public is not a bar to
an investigation by the Director
of Lands as to how such title has
been acquired, if the purpose of
such investigation is to
determine whether or not fraud
had been committed in securing
such title in order that the
appropriate action for reversion
may be filed by the Government.
Private respondent PNB points out
that Animas involved timberland, which is not
alienable or disposable public land, and that
in Piero the issue raised was whether the
Director of Lands would be enjoined by a writ of
prohibition from investigating allegations of
fraud that led to the issuance of certain free
patents. Nevertheless, we find that the doctrine
above quoted is no less controlling even if there
be some factual disparities (which are not
material here), especially as it has been
buttressed by subsequent jurisprudence.
In Director of Lands v. Jugado, upon
which the appellate court based its ruling, the
Court declared meaningfully that:
There is, however, a
section in the Public Land Law
(Sec. 101 of Commonwealth Act
141), which affords a remedy
whereby lands of the public
domain fraudulently awarded
may be recovered or reverted
back to its original owner, the
Government. But the provision
requires that all such actions for
reversion shall be instituted by
the Solicitor General or the
officer acting in his stead, in the
proper courts, in the name of the
Republic of the Philippines (See
Director of Lands v. De
Luna, supra). As the party in
interest in this case is the
Director of Lands and not the
Republic of the Philippines, the
action cannot prosper in favor of
the appellant.
 The reference was to the Public Land
Law which authorizes the reversion suit under
its Sec. 101, thus:
Sec. 101. All actions for
the reversion to the Government
of lands of the public domain or
improvements thereon shall be
instituted by the Solicitor General
or the officer acting in his stead,
in the proper courts, in the name
of the Republic of the
Philippines.
This remedy was recently affirmed by
the Court in Heirs of Gregorio Tengco v. Heirs
of Jose and Victoria Aliwalas, thus:
x x x Title to the property
having become incontrovertible,
such may no longer be
collaterally attacked. If indeed
there had been any fraud or
misrepresentation in obtaining
the title, an action for reversion
instituted by the Solicitor General
would be the proper remedy.
It is evident from the foregoing jurisprudence that
despite the lapse of one year from the entry of a decree of
registration/certificate of title, the State, through the Solicitor
General, may still institute an action for reversion when said
decree/certificate was acquired by fraud or
misrepresentation. Indefeasibility of a title does not attach to
titles secured by fraud and misrepresentation. Well-settled is
the doctrine that the registration of a patent under the Torrens
system does not by itself vest title; it merely confirms the
registrants already existing one. Verily, registration under the
Torrens system is not a mode of acquiring ownership.[160]
But then again, the Court had several times in the past
recognized the right of the State to avail itself of the remedy of
reversion in other instances when the title to the land is void
for reasons other than having been secured by fraud or
misrepresentation. One such case is Spouses Morandarte v.
Court of Appeals,[161] where the Bureau of Lands (BOL), by
mistake and oversight, granted a patent to the spouses
Morandarte which included a portion of the Miputak River.The
Republic instituted an action for reversion 10 years after the
issuance of an OCT in the name of the spouses
Morandarte. The Court ruled:
Be that as it may, the mistake or error of
the officials or agents of the BOL in this regard
cannot be invoked against the government with
regard to property of the public domain. It has
been said that the State cannot be estopped by
the omission, mistake or error of its officials or
agents.
It is well-recognized that if a person
obtains a title under the Public Land Act which
includes, by oversight, lands which cannot be
registered under the Torrens system, or when
the Director of Lands did not have jurisdiction
over the same because it is a public domain,
the grantee does not, by virtue of the said
 certificate of title alone, become the owner of
the land or property illegally included. Otherwise
stated, property of the public domain is
incapable of registration and its inclusion in a
title nullifies that title.
Another example is the case of Republic of the Phils. v. CFI of
Lanao del Norte, Br. IV,[162] in which the homestead patent
issued by the State became null and void because of the
grantees violation of the conditions for the grant. The Court
ordered the reversion even though the land subject of the
patent was already covered by an OCT and the Republic
availed itself of the said remedy more than 11 years after the
cause of action accrued, because:
There is merit in this appeal considering
that the statute of limitation does not lie against
the State. Civil Case No. 1382 of the lower
court for reversion is a suit brought by the
petitioner Republic of the Philippines as a
sovereign state and, by the express provision of
Section 118 of Commonwealth Act No. 141, any
transfer or alienation of a homestead grant
within five (5) years from the issuance of the
patent is null and void and constitute a cause
for reversion of the homestead to the State. In
Republic vs. Ruiz, 23 SCRA 348, We held that
"the Court below committed no error in ordering
the reversion to plaintiff of the land grant
involved herein, notwithstanding the fact that
the original certificate of title based on the
patent had been cancelled and another
certificate issued in the names of the grantee
heirs. Thus, where a grantee is found not
entitled to hold and possess in fee simple the
land, by reason of his having violated Section
118 of the Public Land Law, the Court may
properly order its reconveyance to the grantor,
although the property has already been brought
under the operation of the Torrens
System. And, this right of the government to
bring an appropriate action for reconveyance is
not barred by the lapse of time: the Statute of
Limitations does not run against the State."
(Italics supplied). The above ruling was
reiterated in Republic vs. Mina, 114 SCRA 945.
If the Republic is able to establish after trial and
hearing of Civil Case No. 6686 that the decrees and OCTs in
Doa Demetrias name are void for some reason, then the trial
court can still order the reversion of the parcels of land
covered by the same because indefeasibility cannot attach to
a void decree or certificate of title. The RTC-Branch 4 jumped
the gun when it declared that the cause of action of the
Republic for reversion in Civil Case No. 6686 was already lost
or extinguished by prescription based on the Complaint alone.
All told, the Court finds that the RTC-Branch 4
committed reversible error in dismissing the Complaint for
Cancellation of Titles and Reversion of the Republic in Civil
Case No. 6686. Resultantly, the Court orders the
reinstatement of said Complaint. Yet, the Court also deems it
opportune to recall the following statements in Saad-Agro
Industries, Inc. v. Republic[163]:
It has been held that a complaint for
reversion involves a serious controversy,
 involving a question of fraud and
misrepresentation committed against the
government and it is aimed at the return of the
disputed portion of the public domain. It seeks
to cancel the original certificate of registration,
and nullify the original certificate of title,
including the transfer certificate of title of the
successors-in-interest because the same were
all procured through fraud and
misrepresentation. Thus, the State, as the party
alleging the fraud and misrepresentation that
attended the application of the free patent,
bears that burden of proof. Fraud and
misrepresentation, as grounds for cancellation
of patent and annulment of title, should never
be presumed but must be proved by clear and
convincing evidence, mere preponderance of
evidence not even being adequate. It is but
judicious to require the Government, in an
action for reversion, to show the details
attending the issuance of title over the
alleged inalienable land and explain why
such issuance has deprived the State of the
claimed property. (Emphasis supplied.)
It may do well for the Republic to remember that there
is a prima facie presumption of regularity in the issuance of
Decree Nos. 10364 and 18969, as well as OCT Nos. 0-1200
(a.f.) and 0-1201 (a.f.), in Doa Demetrias name, and the
burden of proof falls upon the Republic to establish by clear
and convincing evidence that said decrees and certificates of
title are null and void.
IV
DISPOSITIVE PART
WHEREFORE, premises considered, the Court renders the
following judgment in the Petitions at bar:
1) In G.R. No. 170375 (Expropriation Case), the
Court GRANTS the Petition for Review of the Republic of
the Philippines. It REVERSES and SETS ASIDE the
Resolutions dated July 12, 2005 and October 24, 2005 of
the Regional Trial Court, Branch 1 of Iligan City, Lanao del
Norte. It further ORDERSthe reinstatement of the Complaint in
Civil Case No. 106, the admission of the Supplemental
Complaint of the Republic, and the return of the original record
of the case to the court of origin for further proceedings. No
costs.
2) In G.R. Nos. 178779 and 178894 (Quieting of Title Case),
the Court DENIES the consolidated Petitions for Review of
Landtrade Realty Corporation, Teofilo Cacho, and/or Atty.
Godofredo Cabildo for lack of merit. It AFFIRMS the Decision
dated January 19, 2007 and Resolution dated July 4, 2007 of
the Court of Appeals in CA-G.R. CV. No. 00456, affirming in
toto the Decision dated July 17, 2004 of the Regional Trial
Court, Branch 3 of Iligan City, Lanao del Norte, in Civil Case
No. 4452. Costs against Landtrade Realty Corporation, Teofilo
Cacho, and Atty. Godofredo Cabildo.
3) In G.R. No. 170505 (The Ejectment or Unlawful
Detainer Case execution pending appeal before the Regional
Trial Court), the Court DENIES the Petition for Review of
Landtrade Realty Corporation for being moot and academic
given that the Regional Trial Court, Branch 1 of Iligan City,
Lanao del Norte had already rendered a Decision dated
December 12, 2005 in Civil Case No. 6613. No costs.
4) In G.R. Nos. 173355-56 and 173563-64 (The Ejectment or
Unlawful Detainer Case execution pending appeal before the
Court of Appeals), the Court GRANTS the consolidated
Petitions for Certiorari and Prohibition of the National Power
Corporation and National Transmission Corporation. It SETS
ASIDE the Resolution dated June 30, 2006 of the Court of
Appeals in CA-G.R. SP Nos. 00854 and 00889 for having
been rendered with grave abuse of discretion amounting to
lack or excess of jurisdiction. It further ORDERS the Court of
Appeals to issue a writ of preliminary injunction enjoining the
execution of the Decision dated December 12, 2005 of the
Regional Trial Court, Branch 1 of Iligan City, Lanao del Norte,
in Civil Case No. 6613, while the same is pending appeal
before the Court of Appeals in CA-G.R. SP Nos. 00854 and
00889. It finally DIRECTS the Court of Appeals to resolve
without further delay the pending appeals before it, in CA-G.R.
SP Nos. 00854 and 00889, in a manner not inconsistent with
this Decision. No costs.
5) In G.R. No. 173401 (Cancellation of Titles and Reversion
Case), the Court GRANTS the Petition for Review of the
Republic of the Philippines. It REVERSES and SETS
ASIDE the Orders dated December 13, 2005 and May 16,
2006 of the Regional Trial Court, Branch 4 of Iligan City in Civil
Case No. 6686. It further ORDERS the reinstatement of the
Complaint in Civil Case No. 6686 and the return of the original
record of the case to the court of origin for further
proceedings. No costs.
SO ORDERED.
G.R. No. L-52064 December 26, 1984
JULIANA CARAGAY-LAYNO, Assisted by Her Husband,
BENITO LAYNO, petitioner,
vs.
HONORABLE COURT OF APPEALS and SALVADOR
ESTRADA as Administrator of the Estate of the Deceased,
MARIANO DE VERA, respondents.
Pedro Peralta for petitioner.
Andres T. Gutierrez for private respondent.
MELENCIO-HERRERA, J.:
Respondent Appellate Court, then the Court of Appeal,
affirmed in toto the judgment of the former Court of First
Instance of Pangasinan, Branch III, at Dagupan adjudging
private respondent entitled to recover possession of a parcel
of land and ordering petitioners, as defendants below, to
vacate the premises. Petitioners, as paupers, now seek a
reversal of that judgment.
It was established by a relocation survey that the Disputed
Portion is a 3,732 square-meter-area of a bigger parcel of
sugar and coconut land (Lot No. 1, Psu-24206 [Case No. 44,
GLRO Rec. No. 117]), with a total area of 8,752 square
meters, situated at Calasiao, Pangasinan. The entire parcel is
covered by Original Certificate of Title No. 63, and includes the
adjoining Lots 2 and 3, issued on 11 September 1947 in the
name of Mariano M. DE VERA, who died in 1951 without
issue. His intestate estate was administered first by his widow
and later by her nephew, respondent Salvador Estrada.
Petitioner, JULIANA Caragay, and the decedent, Mariano DE
VERA, were first cousins, "both orphans, who lived together
under one roof in the care of a common aunt."
As Administratrix, DE VERA's widow filed in Special
Proceedings No. 4058 of the former Court of First Instance of
Pangasinan, Branch III, an Inventory of all properties of the
deceased, which included "a parcel of land in the poblacion of
Calasiao, Pangasinan, containing an area of 5,417 square
meters, more or less, and covered by Tax Declaration No.
12664."
Because of the discrepancy in area mentioned in the Inventory
as 5,147 square meters (as filed by the widow), and that in the
title as 8,752 square meters, ESTRADA repaired to the
Disputed Property and found that the northwestern portion,
subsequently surveyed to be 3,732 square meters, was
occupied by petitioner-spouses Juliana Caragay Layno and
Benito Layno. ESTRADA demanded that they vacate the
Disputed Portion since it was titled in the name of the
deceased DE VERA, but petitioners refused claiming that the
land belonged to them and, before them, to JULIANA's father
Juan Caragay.
ESTRADA then instituted suit against JULIANA for the
recovery of the Disputed Portion (Civil Case No. D-2007),
which she resisted, mainly on the ground that the Disputed
Portion had been fraudulently or mistakenly included in OCT
No. 63, so that an implied or constructive trust existed in her
favor. She then counterclaimed for reconveyance of property
in the sense that title be issued in her favor.
After hearing, the Trial Court rendered judgment ordering
JULIANA to vacate the Disputed Portion.
On appeal respondent Appellate Court affirmed the Decision in
toto.
Before us, JULIANA takes issue with the following finding of
respondent Court:
Although Section 102 of Act 496 allows a
Petition to compel a Trustee to reconvey a
registered land to the cestui que trust (Severino
vs. Severino, 44 Phil 343; Escobar vs. Locsin,
74 PhiL 86) this remedy is no longer available
to Juliana Caragay. Mariano de Vera's land, Lot
1, Psu-24206, was registered on September 11,
1947 (Exhibit"C") and it was only on March 28,
1967 when the defendants filed their original
answer that Caragay sought the reconveyance
to her of the 3,732 square meters. Thus, her
claim for reconveyance based on implied or
constructive trust has prescribed after 10 years
(Banaga vs. Soler, L-15717, June 30,1961; J.M.
Tuason & Co. vs. Magdangal, L-15539, Jan. 30,
1962; Alzona vs. Capunitan, 4 SCRA 450). In
other words, Mariano de Vera's Original
 Certificate of Title No. 63 (Exhibit "C") has
become indefeasible. 1
We are constrained to reverse.
The evidence discloses that the Disputed Portion was
originally possessed openly, continuously and uninterruptedly
in the concept of an owner by Juan Caragay, the deceased
father of JULIANA, and had been declared in his name under
Tax Declaration No. 28694 beginning with the year 1921
(Exhibit "2-C"), later revised by Tax Declaration No. 2298 in
1951 (Exhibit "2-B"). Upon the demise of her father in 1914,
JULIANA adjudicated the property to herself as his sole heir in
1958 (Exhibit "4"), and declared it in her name under Tax
Declaration No. 22522 beginning with the year 1959 (Exhibit
"2-A"), later cancelled by TD No. 3539 in 1966 (Exhibit "2").
Realty taxes were also religiously paid from 1938 to 1972
(Exhibits "3-A" to "3-H"). Tacking the previous possession of
her father to her own, they had been in actual open,
continuous and uninterrupted possession in the concept of
owner for about forty five (45) years, until said possession was
disturbed in 1966 when ESTRADA informed JULIANA that the
Disputed Portion was registered in Mariano DE VERA's name.
To substantiate her claim of fraud in the inclusion of the
Disputed Portion in OCT No. 63, JULIANA, an unlettered
woman, declared that during his lifetime, DE VERA, her first
cousin, and whom she regarded as a father as he was much
older, borrowed from her the Tax Declaration of her land
purportedly to be used as collateral for his loan and sugar
quota application; that relying on her cousin's assurances, she
acceded to his request and was made to sign some
documents the contents of which she did not even know
because of her ignorance; that she discovered the fraudulent
inclusion of the Disputed Portion in OCT No. 63 only in 1966
when ESTRADA so informed her and sought to eject them.
Of significance is the fact, as disclosed by the evidence, that
for twenty (20) years from the date of registration of title in
1947 up to 1967 when this suit for recovery of possession was
instituted, neither the deceased DE VERA up to the time of his
death in 1951, nor his successors-in-interest, had taken steps
to possess or lay adverse claim to the Disputed Portion. They
may, therefore be said to be guilty of laches as would
effectively derail their cause of action. Administrator ESTRADA
took interest in recovering the said portion only when he
noticed the discrepancy in areas in the Inventory of Property
and in the title.
Inasmuch as DE VERA had failed to assert any rights over the
Disputed Portion during his lifetime, nor did he nor his
successors-in-interest possess it for a single moment: but that,
JULIANA had been in actual, continuous and open possession
thereof to the exclusion of all and sundry, the inescapable
inference is, fraud having been unsubstantiated, that it had
been erroneously included in OCT No. 63. The mistake is
confirmed by the fact that deducting 3,732 sq. ms., the area of
the Disputed Portion from 8,752 sq. ms., the area of Lot 1 in
OCT No. 63, the difference is 5,020 sq. ms., which closely
approximates the area of 5,147 sq. ms., indicated in the
Inventory of Property of DE VERA. In fact, the widow by
limiting the area in said Inventory to only 5,147 sq. ms., in
effect, recognized and admitted that the Disputed Portion of
3,132 sq. ms., did not form part of the decedent's estate.
The foregoing conclusion does not necessarily wreak havoc
on the indefeasibility of a Torrens title. For, mere possession
of a certificate of title under the Torrens System is not
conclusive as to the holder's true ownership of all the property
described therein for he does not by virtue of said certificate
alone become the owner of the land illegally included. 2 A Land
Registration Court has no jurisdiction to decree a lot to
persons who have never asserted any right of ownership over
it.
... Obviously then, the inclusion of said area in
the title of Lot No. 8151 is void and of no effect
for a land registration Court has no jurisdiction
to decree a lot to persons who have put no
claim in it and who have never asserted any
right of ownership over it. The Land Registration
Act as well as the Cadastral Act protects only
the holders of a title in good faith and does not
permit its provisions to be used as a shield for
the commission of fraud, or that one should
enrich himself at the expense of another. 3
JULIANA, whose property had been wrongfully registered in
the name of another, but which had not yet passed into the
hands of third parties, can properly seek its reconveyance.
The remedy of the landowner whose property
has been wrongfully or erroneously registered
in another's name is, after one year from the
date of the decree, not to set aside the decree,
but, respecting the decree as incontrovertible
and no longer open to review, to bring an
ordinary action in the ordinary court of justice
for reconveyance or, if the property has passed
into the hands of an innocent purchaser for
value, for damages. 4
Prescription cannot be invoked against JULIANA for the
reason that as lawful possessor and owner of the Disputed
Portion, her cause of action for reconveyance which, in effect,
seeks to quiet title to the property, falls within settled
jurisprudence that an action to quiet title to property in one's
possession is imprescriptible. 5 Her undisturbed possession
over a period of fifty two (52) years gave her a continuing right
to seek the aid of a Court of equity to determine the nature of
the adverse claim of a third party and the effect on her own
title. 6
Besides, under the circumstances, JULIANA's right to quiet
title, to seek reconveyance, and to annul OCT. No. 63 accrued
only in 1966 when she was made aware of a claim adverse to
her own. It was only then that the statutory period of
prescription may be said to have commenced to run against
her, following the pronouncement in Faja vs. Court of Appeals,
supra, a case almost Identical to this one.
... Inasmuch as it is alleged in paragraph 3 of
Frial's complaint, that Felipa Faja has been in
possession of the property since 1945 up to the
present for a period of 30 years, her cause of
action for reconveyance, which in effect seeks
to quiet her title to the property, falls within that
rule. If at all, the period of prescription began to
run against Felipa Faja only from the time she
was served with copy of the complaint in 1975
giving her notice that the property she was
 occupying was titled in the name of Indalecio square meters forming part of Lot No. 1, Psu-24206, Case No.
Frial. There is settled jurisprudence that one 44, GLRO Rec. No. 117, presently occupied by petitioner
who is in actual possession of a piece of land Juliana Caragay-Layno, and to reconvey the same to said
claiming to be owner thereof may wait until his petitioner. After the segregation shall have been
possession is disturbed or his title is attacked accomplished, the Register of Deeds of Pangasinan is hereby
before taking steps to vindicate his right, the ordered to issue a new certificate of title covering said 3,732
reason for the rule being, that his undisturbed sq. m. portion in favor of petitioner, and another crtificate of
possession gives him a continuing right to seek title in favor of the Estate of the deceased, Mariano de Vera
the aid of a court of equity to ascertain and covering the remaining portion of 5,0520 square meters. No
determine the nature of the adverse claim of a costs.
third party and its effect on his own title, which
right can be claimed only by one who is in SO ORDERED
possession. No better situation can be
conceived at the moment for Us to apply this Teehankee (Chairman), Plana, De la Fuente and Cuevas, *
rule on equity than that of herein petitioners JJ., concur.
whose mother, Felipa Faja, was in possession
of the litigated property for no less than 30 Relova and Gutierrez, Jr., JJ., took no part.
years and was suddenly confronted with a claim
that the land she had been occupying and
cultivating all these years, was titled in the OFISTO OO, PRECY G.R. No. 154270
name of a third person. We hold that in such a O.NAMBATAC, VICTORIA O.
situation the right to quiet title to the property, to MANUGAS and POLOR O. Present:
seek its reconveyance and annul any certificate CONSOLACION,
of title covering it, accrued only from the time Petitioners, PUNO, C.J., Chairperson,
the one in possession was made aware of a CARPIO MORALES,
claim adverse to his own, and it is only then that LEONARDO-DE CASTRO,
the statutory period of prescription commences BERSAMIN, and
to run against such possessor. - versus - VILLARAMA, JR., JJ.
Promulgated: March 9,
2010
WHEREFORE, the judgment under review is hereby
VICENTE N. LIM,
REVERSED and SET ASIDE, and another one entered
Respondent.
ordering private respondent Salvador Estrada, as
Administrator of the Estate of the Deceased, Mariano de Vera, x----------------------------------------------------------------------------------
to cause the segregation of the disputed portion of 3,732 -------x
DECISION
BERSAMIN, J.:
The subject of controversy is Lot No. 943 of the Balamban
Cadastre in Cebu City, covered by Original Certificate of Title
(OCT) No. RO-9969-(O-20449), over which the contending
parties in this action for quieting of title, initiated by respondent
Vicente N. Lim (Lim) in the Regional Trial Court (RTC) in Cebu
City, assert exclusive ownership, to the exclusion of the
other. In its decision dated July 30, 1996,[1] the RTC favored
Lim, and ordered the cancellation of OCT No. RO-9969-(O-
20449) and the issuance of a new certificate of title in the
name of Luisa Narvios-Lim (Luisa), Lims deceased mother
and predecessor-in-interest.
On appeal (CA-GR CV No. 57823), the Court of Appeals (CA)
affirmed the RTC on January 28, 2002.[2] It later denied the
petitioners motion for reconsideration through
the resolution dated June 17, 2002.[3]
Hence, this appeal via petition for review on certiorari.
Antecedents
On October 23, 1992, Lim filed in the RTC in Cebu City a
petition for the reconstitution of the owners duplicate copy of
OCT No. RO-9969-(O-20449), alleging that said OCT had
been lost during World War II by his mother, Luisa;[4] that Lot
No. 943 of the Balamban Cadastre in Cebu City covered by
said OCT had been sold in 1937 to Luisa by Spouses Diego
Oo and Estefania Apas (Spouses Oo), the lots registered
owners; and that although the deed evidencing the sale had
been lost without being registered, Antonio Oo (Antonio), the
only legitimate heir of Spouses Oo, had executed on April 23,
1961 in favor of Luisa a notarized document denominated
as confirmation of sale,[5] which was duly filed in the Provincial
Assessors Office of Cebu.
Zosimo Oo and petitioner Teofisto Oo (Oos) opposed
Lims petition, contending that they had the certificate of title in
their possession as the successors-in-interest of Spouses Oo.
On account of the Oos opposition, and upon order of
the RTC, Lim converted the petition for reconstitution into a
complaint for quieting of title,[6]averring additionally that he and
his predecessor-in-interest had been in actual possession of
the property since 1937, cultivating and developing it, enjoying
its fruits, and paying the taxes corresponding to it. He
prayed, inter alia, that the Oos be ordered to surrender the
reconstituted owners duplicate copy of OCT No. RO-9969-(O-
20449), and that said OCT be cancelled and a new certificate
of title be issued in the name of Luisa in lieu of said OCT.
In their answer,[7] the Oos claimed that their predecessors-in-
interest, Spouses Oo, never sold Lot No. 943 to Luisa; and
that the confirmation of salepurportedly executed by Antonio
was fabricated, his signature thereon not being authentic.
RTC Ruling
On July 30, 1996, after trial, the RTC rendered its
decision,[8] viz:
WHEREFORE, premises considered,
judgment is hereby rendered quieting plaintiff's
title to Lot No. 943 of the Balamban (Cebu)
Cadastre, and directing the Register of Deeds
of Cebu
 (1) To register the aforestated April 23,
1961 Confirmation of Sale of Lot No. 943 of the
Balamban, Cebu Cadastre by Antonio Oo in
favor of Luisa Narvios-Lim;
(2) To cancel the original certificate of
title covering the said Lot No. 943 of the
Balamban, Cebu Cadastre; and,
(3) To issue in the name of Luisa
Narvios-Lim, a new duplicate certificate of title
No. RO-9969 (O-20449) of the Register of
Deeds of Cebu, which shall contain a
memorandum of the fact that it is issued in
place of the lost duplicate certificate of title, and
shall in all respects be entitled to like faith and
credit as the original certificate, and shall be
regarded as such for all purposes of this
decree, pursuant to the last paragraph of
Section 109, Presidential Decree No. 1529.
Without special pronouncement as to
costs.
SO ORDERED.[9]
The RTC found that the Lims had been in peaceful possession
of the land since 1937; that their possession had never been
disturbed by the Oos, except on two occasions in 1993 when
the Oos seized the harvested copra from the Lims caretaker;
that the Lims had since declared the lot in their name for
taxation purposes, and had paid the taxes corresponding to
the lot; that the signature of Antonio on the confirmation of
sale was genuine, thereby giving more weight to the testimony
of the notary public who had notarized the document and
affirmatively testified that Antonio and Luisa had both
appeared before him to acknowledge the instrument as true
than to the testimony of the expert witness who attested that
Antonios signature was a forgery.
CA Ruling
On appeal, the Oos maintained that the confirmation of
sale was spurious; that the property, being a titled one, could
not be acquired by the Lims through prescription; that their
(the Oos) action to claim the property could not be barred by
laches; and that the action instituted by the Lims constituted a
collateral attack against their registered title.
The CA affirmed the RTC, however, and found that Spouses
Oo had sold Lot No. 943 to Luisa; and that such sale had been
confirmed by their son Antonio.The CA ruled that the action for
quieting of title was not a collateral, but a direct attack on the
title; and that the Lims undisturbed possession had given them
a continuing right to seek the aid of the courts to determine the
nature of the adverse claim of a third party and its effect on
their own title.
Nonetheless, the CA corrected the RTC, by ordering
that the Office of the Register of Deeds of Cebu City issue a
new duplicate certificate of title in the name of Luisa,
considering that the owners duplicate was still intact in the
possession of the Oos.
The decree of the CA decision was as follows:
WHEREFORE, the appeal is DISMISSED
for lack of merit. However, the dispositive
portion of the decision appealed from is
CORRECTED as follows:
(1) Within five (5) days from finality of the
decision, defendants-appellants are
directed to present the owner's
duplicate copy of OCT No. RO-9969
(O-20449) to the Register of Deeds
who shall thereupon register the
Confirmation of Sale of Lot No. 943,
Balamban Cadastre, Cebu, executed
on April 23, 1961 by Antonio Oo in
favor of Luisa Narvios-Lim, and issue
a new transfer certificate of title to and
in the name of the latter upon
cancellation of the outstanding original
and owner's duplicate certificate of
title.
(2) In the event defendants-appellants
neglect or refuse to present the
owner's copy of the title to the Register
of Deeds as herein directed, the said
title, by force of this decision, shall be
deemed annulled, and the Register of
Deeds shall make a memorandum of
such fact in the record and in the new
transfer certificate of title to be issued
to Luisa Narvios-Lim.
(3) Defendants-appellants shall pay the
costs.
SO ORDERED.[10]
The CA denied the Oos motion for reconsideration[11] on June
17, 2002.[12]
Hence, this appeal.
Issues
The petitioners raise the following issues:
1. Whether or not the validity of the OCT
could be collaterally attacked through an
ordinary civil action to quiet title;
2. Whether or not the ownership over
registered land could be lost by prescription,
laches, or adverse possession;
3. Whether or not there was a deed of sale
executed by Spouses Oo in favor of Luisa
and whether or not said deed was lost
during World War II;
4. Whether or not the confirmation of
sale executed by Antonio in favor of Luisa
existed; and
5. Whether or not the signature purportedly of
Antonio in that confirmation of sale was
genuine.

Ruling of the Court
The petition has no merit.
A.
Action for cancellation of title
is not an attack on the title
The petitioners contend that this action for quieting of
title should be disallowed because it constituted a collateral
attack on OCT No. RO-9969-(O-20449), citing Section 48 of
Presidential Decree No. 1529, viz:
Section 48. Certificate not subject to
collateral attack. A certificate of title shall not be
subject to collateral attack. It cannot be altered,
modified, or cancelled except in a direct
proceeding in accordance with law.
The petitioners contention is not well taken.
An action or proceeding is deemed an attack on a title
when its objective is to nullify the title, thereby challenging the
judgment pursuant to which the title was decreed.[13] The
attack is direct when the objective is to annul or set aside such
judgment, or enjoin its enforcement. On the other hand, the
attack is indirect or collateral when, in an action to obtain a
different relief, an attack on the judgment is nevertheless
made as an incident thereof.[14]
Quieting of title is a common law remedy for the
removal of any cloud, doubt, or uncertainty affecting title to
real property.[15] Whenever there is a cloud on title to real
property or any interest in real property by reason of any
instrument, record, claim, encumbrance, or proceeding that 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.[16] In such action, the competent court is
tasked to determine the respective rights of the complainant
and the other claimants, not only to place things in their proper
places, and to make the claimant, who has no rights to said
immovable, respect and not disturb the one so entitled, but
also for the benefit of both, so that whoever has the right will
see every cloud of doubt over the property dissipated, and he
can thereafter fearlessly introduce the improvements he may
desire, as well as use, and even abuse the property as he
deems fit.[17]
Lims complaint pertinently alleged:
18. If indeed, the genuine original of the
Owner's Duplicate of the Reconstituted Original
Certificate of Title No. RO-9699 (O-20449)
for Lot 943, Balamban Cadastre xxx is in
Defendant's (Oos) possession, then VNL
submits the following PROPOSITIONS:
xxx
18.2. Therefore, the Original of Owners
Duplicate Certificate (which Respondents
[Defendants Oos] claim in their Opposition is in
their possession) must be surrendered to VNL
upon order of this Court, after the Court shall
 have determined VNL's mother's acquisition of
the attributes of ownership over said Lot 943, in
this action, in accordance with Section 107,
P.D. 1529, Property Registration Decree xxx
xxx
[t]hat OCT 20449 be cancelled and new title for
Lot 943 be issued directly in favor of LUISA
NARVIOS, to complete her title to said Lot;[18]
The averments readily show that the action was neither
a direct nor a collateral attack on OCT No. RO-9969-(O-
20449), for Lim was asserting only that the existing title
registered in the name of the petitioners predecessors had
become inoperative due to the conveyance in favor of Lims
mother, and resultantly should be cancelled. Lim did not
thereby assail the validity of OCT No. RO-9969-(O-20449), or
challenge the judgment by which the title of the lot involved
had been decreed. In other words, the action sought the
removal of a cloud from Lims title, and the confirmation of
Lims ownership over the disputed property as the successor-
in-interest of Luisa.
B.
Prescription was not relevant
The petitioners assert that the lot, being titled in the name of
their predecessors-in-interest, could not be acquired by
prescription or adverse possession.
The assertion is unwarranted.
Prescription, in general, is a mode of acquiring or
losing ownership and other real rights through the lapse of
time in the manner and under the conditions laid down by
law.[19] However, prescription was not relevant to the
determination of the dispute herein, considering that Lim did
not base his right of ownership on an adverse possession
over a certain period. He insisted herein, instead, that title to
the land had been voluntarily transferred by the registered
owners themselves to Luisa, his predecessor-in-interest.
Lim showed that his mother had derived a just title to the
property by virtue of sale; that from the time Luisa had
acquired the property in 1937, she had taken over its
possession in the concept of an owner, and had performed
her obligation by paying real property taxes on the property,
as evidenced by tax declarations issued in her name;[20] and
that in view of the delivery of the property, coupled with Luisas
actual occupation of it, all that remained to be done was the
issuance of a new transfer certificate of title in her name.
C.
Forgery, being a question of fact,
could not be dealt with now
The petitioners submit that Lims evidence did not
preponderantly show that the ownership of the lot had been
transferred to Luisa; and that both the trial and the appellate
courts disregarded their showing that Antonios signature on
the confirmation of sale was a forgery.
Clearly, the petitioners hereby seek a review of the evaluation
and appreciation of the evidence presented by the parties.
The Court cannot anymore review the evaluation and
appreciation of the evidence, because the Court is not a trier
of facts.[21] Although this rule admits of certain exceptions, viz:
(1) when the conclusion is a finding grounded entirely on
speculation, surmises, or conjecture; (2) when the inference
made is manifestly mistaken; (3) where there is a grave abuse
of discretion; (4) when the judgment is based on a
misapprehension of facts; (5) when the findings of fact are
conflicting; (6) when the Court of Appeals, in making its
findings, went beyond the issues of the case, and the findings
are contrary to the admissions of both appellant and appellee;
(7) when the findings of the Court of Appeals are contrary to
those of the trial court; (8) when the findings of fact are
conclusions without specific evidence on which they are
based; (9) when the facts set forth in the petition as well in the
petitioners main and reply briefs are not disputed by the
respondents; and, (10) when the findings of fact of the Court of
Appeals are premised on the supposed absence of evidence
and are contradicted by the evidence on record,[22] it does not
appear now that any of the exceptions is present herein. We
thus apply the rule without hesitation, and reject the appeal for
that reason.
It is emphasized, too, that the CA upheld the
conclusion arrived at by the RTC that the signature of Antonio
had not been simulated or forged. The CA ruled that the
testimony of the notary public who had notarized
the confirmation of sale to the effect that Antonio and Luisa
had appeared before him prevailed over that of the petitioners
expert witness. The concurrence of their conclusion on the
genuineness of Antonios signature now binds the Court.[23]
In civil cases, the party having the burden of proof must
establish his case by a preponderance of
evidence. Preponderance of evidence is the weight, credit,
and value of the aggregate evidence on either side, and is
usually considered to be synonymous with the term greater
weight of the evidence or greater weight of the credible
evidence. Preponderance of evidence is a phrase that means,
in the last analysis, probability of the truth.[24] It is evidence that
is more convincing to the court as worthy of belief than that
which is offered in opposition thereto.
Lim successfully discharged his burden of proof as the
plaintiff. He established by preponderant evidence that he had
a superior right and title to the property. In contrast, the
petitioners did not present any proof of their better title other
than their copy of the reconstituted certificate of title. Such
proof was not enough, because the registration of a piece of
land under the Torrens system did not create or vest title, such
registration not being a mode of acquiring ownership. The
petitioners need to be reminded that a certificate of title is
merely an evidence of ownership or title over the particular
property described therein. Its issuance in favor of a particular
person does not foreclose the possibility that the real property
may be co-owned with persons not named in the certificate, or
that it may be held in trust for another person by the registered
owner.[25]
WHEREFORE, the petition for review on certiorari is
denied, and the decision dated January 28, 2002 is affirmed.
The petitioners are ordered to pay the costs of suit.
SO ORDERED.
HEIRS OF VALERIANO S. CONCHA, G.R. No. 158121
SR. NAMELY: TERESITA CONCHA-
PARAN, VALERIANO P. CONCHA, separate motions to dismiss and Joint Motion for
JR., RAMON P. CONCHA, EDUARDO Reconsideration filed by the respondents.
P. CONCHA, REPRESENTED BY HIS
LEGAL GUARDIAN, REYNALDO P. The relevant facts are undisputed.
CONCHA, ALBERTO P. CONCHA,
BERNARDO P. CONCHA and GLORIA Present: Petitioners, heirs of spouses Dorotea and Valeriano
P. CONCHA-NUNAG, Concha, Sr., claim to be the rightful owners of Lot No. 6195
Petitioners, PUNO, C.J., Chairperson, (Civil Case No. 5188), a one-hectare portion of Lot No. 6196-
YNARES-SANTIAGO, A (Civil Case No. 5433), and a one-hectare portion of Lot Nos.
SANDOVAL-GUTIERREZ, 6196-B and 7529-A (Civil Case No. 5434), all situated in
- versus - CORONA, and Cogon, Dipolog City, under Section 48(b) of Commonwealth
AZCUNA, JJ. Act No. 141 (C.A. No. 141), otherwise known as the Public
SPOUSES GREGORIO J. LUMOCSO[1] Land Act. Respondent siblings Gregorio Lumocso (Civil Case
and BIENVENIDA GUYA, CRISTITA No. 5188), Cristita Lumocso Vda. de Daan (Civil Case No.
J. LUMOCSO VDA. DE DAAN, AND 5433) and Jacinto Lumocso (Civil Case No. 5434), are the
SPOUSES JACINTO J. LUMOCSO Promulgated: patent holders and registered owners of the subject lots.
and BALBINA T. LUMOCSO,[2]
Respondents. December 12, 2007 The records show that on August 6, 1997, Valeriano
Sr.[7] and his children, petitioners Valeriano Jr., Ramon,
x-------------------------------------------- Eduardo, Alberto, Bernardo, Teresita, Reynaldo, and Gloria,
------x all surnamed Concha, filed a complaint for Reconveyance
and/or Annulment of Title with Damages against "Spouses
Gregorio Lomocso and Bienvenida Guya." They sought to
DECISION annul Free Patent No. (IX-8)985 and the corresponding
Original Certificate of Title (OCT) No. P-22556 issued in the
PUNO, C.J.: name of "Gregorio Lumocso" covering Lot No. 6195. The case
was raffled to the RTC of Dipolog City, Branch 9, and
On appeal by certiorari under Rule 45 of the Rules of docketed as Civil Case No. 5188. In their Amended
Court are the Complaint, petitioners prayed that judgment be rendered:
decision[3] and resolution[4] of the Court of Appeals (CA) in CA-
G.R. SP No. 59499, annulling the resolutions[5] and order[6] of 1. Declaring Free Patent No.
the Regional Trial Court (RTC) of Dipolog City, Branch 9, in (IX-8)985 and Original Certificate of Title No.
Civil Case Nos. 5188, 5433 and 5434 which denied the 22556 issued to defendants as null and void ab
initio;

2. Declaring Lot No. 6195 or
1.19122-hectare as private property of the
plaintiffs under Sec. 48(b) of CA No. 141
otherwise known as the Public Land Act as
amended by RA 1942;
3. Ordering the defendant
Lomocsos to reconvey the properties (sic) in
question Lot No. 6195 or the 1.19122 hectares
in favor of the plaintiffs within 30 days from the
finality of the decision in this case and if they
refuse, ordering the Clerk of Court of this
Honorable Court to execute the deed of
reconveyance with like force and effect as if
executed by the defendant[s] themselves;
4. Ordering defendant
Lomocsos to pay P60,000.00 for the 21 forest
trees illegally cut; P50,000.00 for moral
damages; P20,000.00 for Attorneys
fees; P20,000.00 for litigation expenses; and to
pay the cost of the proceedings;
5. Declaring the confiscated
three (sic) flitches kept in the area of the
plaintiffs at Dampalan San Jose, Dipolog with a
total volume of 2000 board feet a[s] property of
the plaintiff [they] being cut, collected and
taken from the land possessed, preserved, and
owned by the plaintiffs;
6. The plaintiffs further pray
for such other reliefs and remedies which this
Honorable Court may deem just and equitable
in the premises.[8]
On September 3, 1999, two separate complaints for
Reconveyance with Damages were filed by petitioners,[9] this
time against "Cristita Lomocso Vda. de Daan" for a one-
hectare portion of Lot No. 6196-A and "Spouses Jacinto
Lomocso and Balbina T. Lomocso" for a one-hectare portion of
Lot Nos. 6196-B and 7529-A. The two complaints were also
raffled to Branch 9 of the RTC of Dipolog City and docketed as
Civil Case Nos. 5433 and 5434,
respectively. In Civil Case No. 5433, petitioners prayed that
judgment be rendered:
1. Declaring [a] portion of Lot 6196-A
titled under OCT (P23527) 4888 equivalent to
one hectare located at the western portion of
Lot 4888 as private property of the plaintiffs
under Sec. 48(B) CA 141 otherwise known as
Public Land OCT (sic) as amended by RA No.
1942;
2. Ordering the defendant to reconvey
the equivalent of one (1) hectare forested
portion of her property in question in favor of
the plaintiffs within 30 days from the finality of
the decision in this case segregating one
hectare from OCT (P23527) 4888, located at
its Western portion and if she refuse (sic),
ordering the Clerk of Court of this Honorable
Court to execute the deed of reconveyance
with like force and effect, as if executed by the
defenda[n]t herself;

3. Ordering defendant to
pay P30,000.00 for the 22 forest trees illegally
cut; P20,000.00 for moral
damages; P20,000.00 for Attorney's
fees; P20,000.00 for litigation expenses; and to
pay the cost of the proceedings.[10]
In Civil Case No. 5434, petitioners prayed that
judgment be rendered:
1. Declaring [a] portion of Lot 7529-A
under OCT (P-23207) 12870 and Lot 6196-B
OCT (P-20845) 4889 equivalent to one hectare
located as (sic) the western portion of said lots
as private property of the plaintiffs under Sec.
48(b) of [C.A. No.] 141 otherwise know[n] as
the [P]ublic [L]and [A]ct as amended by RA
1942;
2. Ordering the defendants to reconvey
the equivalent of one (1) hectare forested
portion of their properties in question in favor
of the plaintiffs within 30 days from the finality
of the decision in this case segregating one
hectare from OCT (P-23207) 12870 and OCT
(T-20845)-4889 all of defendants, located at its
Western portion and if they refuse, ordering
the Clerk of Court of this Honorable Court to
execute the deed of reconveyance with like
force and effect as if executed by the
defendants themselves[;]
3. Ordering defendants to
pay P20,000.00 for the six (6) forest trees
illegally cut; P20,000.00 for moral
damages; P20,000.00 for Attorney's
fees; P20,000.00 for litigation expenses; and to
pay the cost of the proceedings.[11]
The three complaints[12] commonly alleged: a) that
on May 21, 1958, petitioners' parents (spouses Valeriano Sr.
and Dorotea Concha) acquired by homestead a 24-hectare
parcel of land situated in Cogon, Dipolog City; b) that since
1931, spouses Concha "painstakingly preserved" the forest in
the 24-hectare land, including the excess four (4) hectares
"untitled forest land" located at its eastern portion; c) that they
possessed this excess 4 hectares of land (which consisted of
Lot No. 6195, one-hectare portion of Lot No. 6196-A and one-
hectare portion of Lot Nos. 6196-B and 7529-A) "continuously,
publicly, notoriously, adversely, peacefully, in good faith and in
concept of the (sic) owner since 1931;" d) that they continued
possession and occupation of the 4-hectare land after the
death of Dorotea Concha on December 23, 1992 and
Valeriano Sr. on May 12, 1999; e) that the Concha spouses
"have preserved the forest trees standing in [the subject lots]
to the exclusion of the defendants (respondents) or other
persons from 1931" up to November 12, 1996 (for Civil Case
No. 5188) or January 1997 (for Civil Case Nos. 5433 and
5434) when respondents, "by force, intimidation, [and] stealth
forcibly entered the premises, illegally cut, collected, [and]
disposed" of 21 trees (for Civil Case No. 5188), 22 trees (for
Civil Case No. 5433) or 6 trees (for Civil Case No. 5434); f)
that "the land is private land or that even assuming it was part
of the public domain, plaintiffs had already acquired imperfect
title thereto" under Sec. 48(b) of C.A. No. 141, as amended by
Republic Act (R.A.) No. 1942; g) that respondents allegedly
cut into flitches the trees felled in Lot No. 6195 (Civil Case No.
5188) while the logs taken from the subject lots in Civil Case
Nos. 5433 and 5434 were sold to a timber dealer in Katipunan,
Zamboanga del Norte; h) that respondents "surreptitiously"
filed free patent applications over the lots despite their full
knowledge that petitioners owned the lots; i) that the geodetic
engineers who conducted the original survey over the lots
never informed them of the
survey to give them an opportunity to oppose respondents'
applications; j) that respondents' free patents and the
corresponding OCTs were issued "on account of fraud, deceit,
bad faith and misrepresentation"; and k) that the lots in
question have not been transferred to an innocent purchaser.
On separate occasions, respondents moved for the
dismissal of the respective cases against them on the same
grounds of: (a) lack of jurisdiction of the RTC over the subject
matters of the complaints; (b) failure to state causes of action
for reconveyance; (c) prescription; and (d) waiver,
abandonment, laches and estoppel.[13] On the issue of
jurisdiction, respondents contended that the RTC has no
jurisdiction over the complaints pursuant to Section 19(2) of
Batas Pambansa Blg. (B.P.) 129, as amended by R.A. No.
7691, as in each case, the assessed values of the subject lots
are less than P20,000.00.
Petitioners opposed,[14] contending that the instant
cases involve actions the subject matters of which are
incapable of pecuniary estimation which, under Section 19(1)
of B.P. 129, as amended by R.A. 7691, fall within the exclusive
original jurisdiction of the RTCs. They also contended that they
have two main causes of action: for reconveyance and for
recovery of the value of the trees felled by
respondents. Hence, the totality of the claims must be
considered which, if computed, allegedly falls within the
exclusive original jurisdiction of the RTC.
The trial court denied the respective motions to dismiss
of respondents.[15] The respondents filed a Joint Motion for
Reconsideration,[16] to no avail.[17]
Dissatisfied, respondents jointly filed a Petition for Certiorari,
Prohibition and Preliminary Injunction with Prayer for Issuance
of Restraining Order Ex Parte[18] with the CA, docketed as CA-
G.R. SP No. 59499. In its Decision,[19] the CA reversed the
resolutions and order of the trial court. It held that even
assuming that the complaints state a cause of action, the
same have been barred by the statute of limitations. The CA
ruled that an action for reconveyance based on fraud
prescribes in ten (10) years, hence, the instant complaints
must be dismissed as they involve titles issued for at least
twenty-two (22) years prior to the filing of the complaints. The
CA found it unnecessary to resolve the other issues.
Hence, this appeal in which petitioners raise the following
issues, viz:
FIRST - WHETHER OR NOT RESPONDENT
COURT OF APPEALS (FORMER FIRST
DIVISION) ERRED IN REVERSING THE
ORDER OF THE COURT A QUO DENYING
THE MOTION FOR DISMISSAL,
CONSIDERING THE DISMISSAL OF A
PARTY COMPLAINT IS PREMATURE AND
TRIAL ON THE MERITS SHOULD BE
CONDUCTED TO THRESH OUT
EVIDENTIARY MATTERS.
SECOND - WHETHER OR NOT THE CATUIRA VS. COURT OF APPEALS (172
RESPONDENT COURT OF APPEALS SCRA 136).[20]
(FORMER FIRST DIVISION) ERRED IN
DISMISSING THE PETITIONERS'
COMPLAINTS ON [THE] GROUND OF In their memorandum,[21] respondents reiterated their
PRESCRIPTION. arguments in the courts below that: a) the complaints of the
petitioners in the trial court do not state causes of action for
THIRD - WHETHER OR NOT THE reconveyance; b) assuming the complaints state causes of
RESPONDENT COURT OF APPEALS action for reconveyance, the same have already been barred
(FORMER FIRST DIVISION) ERRED IN by prescription;c) the RTC does not have jurisdiction over the
CONCLUDING THAT THERE IS NO subject matter of the instant cases; d) the claims for
DOCUMENTARY EVIDENCE ON RECORD reconveyance in the complaints are barred by waiver,
TO SHOW THAT PETITIONERS OWN abandonment, or otherwise extinguished by laches and
THE SUBJECT FOREST estoppel; and e) there is no special reason warranting a review
PORTION OF THE PROPERTIES by this Court.
ERRONEOUSLY INCLUDED IN THE TITLES
OF PRIVATE RESPONDENTS. Since the issue of jurisdiction is determinative of the
resolution of the instant case yet the CA skirted the question,
FOURTH - WHETHER OR NOT THE we resolved to require the parties to submit their respective
PETITION OF HEREIN PRIVATE Supplemental Memoranda on the issue of jurisdiction.[22]
RESPONDENTS FILED WITH THE
RESPONDENT COURT OF APPEALS In their Supplemental Memorandum,[23] petitioners
(FORMER FIRST DIVISION) SHOULD HAVE contend that the nature of their complaints, as denominated
BEEN DISMISSED OUTRIGHTLY FOR therein and as borne by their allegations, are suits for
PRIVATE RESPONDENTS' THEREIN reconveyance, or annulment or cancellation of OCTs and
FAILURE TO COMPLY WITH THE damages. The cases allegedly involve more than just the issue
MANDATORY REQUIREMENT OF SECTION of
1 RULE 65 OF THE RULES OF COURT TO title and possession since the nullity of the OCTs issued to
SUBMIT CERTIFIED TRUE COPIES OF THE respondents and the reconveyance of the subject properties
ASSAILED ORDERS OF THE TRIAL COURT were also raised as issues. Thus, the RTC has jurisdiction
WHICH RENDERED THEIR PETITION (CA under Section 19(1) of B.P. 129, which provides that the RTC
G.R. 59499) DEFICIENT IN FORM AND has jurisdiction "[i]n all civil actions in which the subject of the
SUBSTANCE CITING THE CASE OF litigation is incapable of pecuniary estimation." Petitioners
cited: a) Raymundo v. CA[24] which set the criteria for
determining whether an action is one not capable of pecuniary
estimation; b) Swan v. CA[25] where it was held that an action
for annulment of title is under the jurisdiction of the RTC;
c) Santos v. CA[26]where it was similarly held that an action for
annulment of title, reversion and damages was within the
jurisdiction of the RTC; and d) Commodities Storage and ICE
Plant Corporation v. CA[27] where it was held that "[w]here
the action affects title to the property, it should be filed in the
RTC where the property is located." Petitioners also contend
that while it may be argued that the assessed values of the
subject properties are within the original jurisdiction of the
municipal trial court (MTC), they have included in their prayers
"any interest included therein" consisting of 49 felled natural
grown trees illegally cut by respondents. Combining the
assessed values of the properties as shown by their respective
tax declarations and the estimated value of the trees cut, the
total amount prayed by petitioners exceeds twenty thousand
pesos (P20,000.00). Hence, they contend that the RTC has
jurisdiction under Section 19(2) of B.P. 129.
Jurisdiction over the subject matter is the power to hear
and determine cases of the general class to which the
proceedings in question belong.[28] It is conferred by law and
an objection based on this ground cannot be waived by the
parties.[29] To determine whether a court has jurisdiction over
the subject matter of a case, it is important to determine the
nature of the cause of action and of the relief sought.[30]
The trial court correctly held that the instant cases
involve actions for reconveyance.[31] An action for
reconveyance respects the decree of registration as
incontrovertible but seeks the transfer of property, which has
been wrongfully or erroneously registered in other persons'
names, to its rightful and legal owners, or to those who claim
to have a better right.[32] There is no special ground for an
action for reconveyance. It is enough that the aggrieved party
has a legal claim on the property superior to that of the
registered owner[33] and that the property has not yet passed to
the hands of an innocent purchaser for value.[34]
The reliefs sought by the petitioners in the instant
cases typify an action for reconveyance. The following are
also the common allegations in the three complaints that are
sufficient to constitute causes of action for reconveyance, viz:
(a) That plaintiff Valeriano S. Concha,
Sr. together with his spouse Dorotea Concha
have painstakingly preserve[d] the forest
standing in the area [of their 24-hectare
homestead] including the four hectares untitled
forest land located at the eastern portion of the
forest from 1931 when they were newly
married, the date they acquired this property
by occupation or possession;[35]
(b) That spouses Valeriano S. Concha
Sr. and Dorotea P. Concha have preserved the
forest trees standing in [these parcels] of land
to the exclusion of the defendants Lomocsos
or other persons from 1931 up to November
12, 1996 [for Civil Case No. 5188] and January
1997 [for Civil Case Nos. 5433 and 5434]
when defendants[,] by force, intimidation, [and]
stealth[,] forcibly entered the premises,
illegal[ly] cut, collected, disposed a total of
[twenty-one (21) trees for Civil Case No. 5188,
 twenty-two (22) trees for Civil Case No. 5433
and six (6) trees for Civil Case No. 5434] of
various sizes;[36]
(c) That this claim is an assertion that
the land is private land or that even assuming
it was part of the public domain, plaintiff had
already acquired imperfect title thereto under
Sec. 48(b) of [C.A.] No. 141[,] otherwise known
as the Public Land Act[,] as amended by [R.A.]
No. [7691];[37]
(d) That [respondents and their
predecessors-in-interest knew when they]
surreptitiously filed[38] [their respective patent
applications and were issued their respective]
free patents and original certificates of title
[that the subject lots belonged to the
petitioners];[39]
(e) [That respondents' free patents and
the corresponding original certificates of titles
were issued] on account of fraud, deceit, bad
faith and misrepresentation;[40] and
(f) The land in question has not been
transferred to an innocent purchaser.[41]
These cases may also be considered as actions to
remove cloud on one's title as they are intended to procure the
cancellation of an instrument constituting a claim on
petitioners' alleged title which was used to injure or vex them
in the enjoyment of their alleged title.[42]
Being in the nature of actions for reconveyance or
actions to remove cloud on one's title, the applicable law to
determine which court has jurisdiction is Section 19(2) of B.P.
129, as amended by R.A. No. 7691, viz:
Section 19. Jurisdiction in Civil Cases.-
- Regional Trial Courts shall exercise exclusive
original jurisdiction: x x x
(2) In all civil actions which involve the
title to, or possession of, real property, or any
interest therein, where the assessed value of
the property involved exceeds Twenty
thousand pesos (P20,000.00) or for civil
actions in Metro Manila, where such value
exceeds Fifty thousand pesos (P50,000.00)
except actions for forcible entry into and
unlawful detainer of lands or buildings, original
jurisdiction over which is conferred upon the
Metropolitan Trial Courts, Municipal Trial
Courts, and Municipal Circuit Trial Courts;
x x x.
In the cases at bar, it is undisputed that the subject lots
are situated in Cogon, Dipolog City and their assessed values
are less than P20,000.00, to wit:
Civil Case No. Lot No. Assessed Value
5188 6195 P1,030.00
5433 6196-A 4,500.00

5434 6196-B 4,340.00
7529-A 1,880.00.[43]
Hence, the MTC clearly has jurisdiction over the
instant cases.
Petitioners' contention that this case is one that is
incapable of pecuniary estimation under the exclusive original
jurisdiction of the RTC pursuant to Section 19(1) of B.P. 129 is
erroneous.
In a number of cases, we have held that actions for
reconveyance[44] of or for cancellation of title[45] to or to quiet
title[46] over real property are actions that fall under the
classification of cases that involve "title to, or possession of,
real property, or any interest therein."
The original text of Section 19(2) of B.P. 129 as well as
its forerunner, Section 44(b) of R.A. 296,[47] as amended, gave
the RTCs (formerly courts of first instance) exclusive original
jurisdiction "[i]n all civil actions which involve the title to,
or possession of, real property, or any interest
therein,except actions for forcible entry into and unlawful
detainer of lands or buildings, original jurisdiction over which is
conferred upon Metropolitan Trial Courts, [MTCs], and
Municipal Circuit Trial Courts (conferred upon the city and
municipal courts under R.A. 296, as amended)." Thus, under
the old law, there was no substantial effect on jurisdiction
whether a case is one, the subject matter of which was
incapable of pecuniary estimation, under Section 19(1) of B.P.
129 or one involving title to property under Section 19(2). The
distinction between the two classes became crucial with the
amendment introduced by R.A. No. 7691[48] in 1994 which
expanded the exclusive original jurisdiction of the first level
courts to include "all civil actions which involve title to, or
possession of, real property, or any interest therein where the
assessed value of the property or interest therein does
not exceed Twenty thousand pesos (P20,000.00) or, in
civil actions in Metro Manila, where such assessed value
does not exceed Fifty thousand pesos (P50,000.00)
exclusive of interest, damages of whatever kind,
attorney's fees, litigation expenses and costs." Thus, under
the present law, original jurisdiction over cases the subject
matter of which involves "title to, possession of, real property
or any interest therein" under Section 19(2) of B.P. 129 is
divided between the first and second level courts, with the
assessed value of the real property involved as the
benchmark. This amendment was introduced to "unclog the
overloaded dockets of the RTCs which would result in the
speedier administration of justice."[49]
The cases of Raymundo v. CA[50] and Commodities
Storage and ICE Plant Corporation v. CA,[51] relied upon by
the petitioners, are inapplicable to the cases at
bar. Raymundo involved a complaint for mandatory
injunction, not one for reconveyance or annulment of title. The
bone of contention was whether the case was incapable of
pecuniary estimation considering petitioner's contention that
the pecuniary claim of the complaint was only attorney's fees
of P10,000, hence, the MTC had jurisdiction. The Court
defined the criterion for determining whether an action is one
that is incapable of pecuniary estimation and held that the
issue of whether petitioner violated the provisions of the
Master Deed and Declaration of Restriction of the Corporation
is one that is incapable of pecuniary estimation. The claim for
attorney's fees was merely incidental to the principal action,
hence, said amount was not determinative of the court's
jurisdiction. Nor can Commodities Storage and ICE Plant
Corporation provide any comfort to petitioners for the issue
resolved by the Court in said case was venue and not
jurisdiction. The action therein was for damages, accounting
and fixing of redemption period which was filed on October 28,
1994, before the passage of R.A. No. 7691. In resolving the
issue of venue, the Court held that "[w]here the action affects
title to property, it should be instituted in the [RTC] where the
property is situated. The Sta. Maria Ice Plant & Cold Storage
is located in Sta. Maria, Bulacan. The venue in Civil Case No.
94-727076 was therefore improperly laid."
Worse, the cases of Swan v. CA[52] and Santos v.
[53]
CA cited by the petitioners, contradict their own position
that the nature of the instant cases falls under Section 19(1) of
B.P. 129. The complaints in Swan and Santos were filed prior
to the enactment of R.A. No. 7691. In Swan, the Court held
that the action being one for annulment of title, the RTC had
original jurisdiction under Section 19(2) of B.P.
129. In Santos, the Court similarly held that the complaint for
cancellation of title, reversion and damages is also one that
involves title to and possession of real property under Section
19(2) of B.P. 129.Thus, while the Court held that the RTC had
jurisdiction, the Court classified actions for "annulment of title"
and "cancellation of title, reversion and damages" as civil
actions that involve "title to, or possession of, real property, or
any interest therein" under Section 19(2) of B.P. 129.
Petitioners' contention that the value of the trees cut in
the subject properties constitutes "any interest therein (in the
subject properties)" that should be computed in addition to the
respective assessed values of the subject properties is
unavailing. Section 19(2) of B.P. 129, as amended by R.A.
No. 7691, is clear that the RTC shall exercise jurisdiction "in
all civil actions which involve the title to, or possession of, real
property, or any interest therein, where the assessed value
of the property involved exceeds Twenty thousand pesos
(P20,000.00) or for civil actions in Metro Manila, where
such value exceeds Fifty thousand pesos (P50,000.00)." It
is true that the recovery of the value of the trees cut from the
subject properties may be included in the term "any interest
therein." However, the law is emphatic that in determining
which court has jurisdiction, it is only the assessed value of
the realty involved that should be computed.[54] In this case,
there is no dispute that the assessed values of the subject
properties as shown by their tax declarations are less
than P20,000.00.Clearly, jurisdiction over the instant cases
belongs not to the RTC but to the MTC.
IN VIEW WHEREOF, the decision of the Court of
Appeals is hereby AFFIRMED that the RTC of Dipolog City,
Branch 9, has no jurisdiction in Civil Case Nos. 5188, 5433
and 5434.
No costs.
SO ORDERED.
G.R. No. L-69622 January 29, 1988
LILIA Y. GONZALES, petitioner,
vs.
INTERMEDIATE APPELLATE COURT and RURAL BANK
OF PAVIA, INC., respondents.
GANCAYCO, J.:
This is a petition for review on certiorari of the Decision of the
Court of Appeals dated November 15,1983, 1 affirming the
decision of the trial court of July 16, 1975 2 dismissing the
complaint for annulment of title and ordering plaintiff, herein
petitioner, to deliver possession of the property covered by
said title and to account for the produce thereof to defendant
bank, private respondent herein.
The antecedent facts of this case as found by the Appellate
Court are as follows:
The spouses Asuncion Sustiguer and Dioscoro Buensuceso
were the original owners of Lot No. 2161 of the Cadastral
Survey of Barotac Nuevo, the property subject of this
controversy. For delinquency in the payment of the real estate
taxes due thereon, the land was sold at public auction to the
Province of Iloilo in 1955. Hortencia Buensuceso, daughter of
said spouses, discovered in the office of the Register of Deeds
of Iloilo that the Certificate of Title of subject land, OCT No.
3351, was still in the name of her parents. Hortencia paid the
back taxes on the land in behalf of her mother (who by that
time was already separated in fact from her father) in whose
favor the Provincial Treasurer executed a deed of repurchase
on April 10, 1969. On April 17, 1969, the spouses Gaudioso
Panzo and Hortencia Buensuceso bought the land from the
latter's mother for P1,000.00. Thereafter, the spouses Panzo
filed a petition in the Court of First Instance of Iloilo for the
reconstitution of the original certificate of title. On February
26,1971, a reconstituted original certificate of title was issued
in the name of Asuncion Sustiguer alone. And by virtue of the
sale of said property by Sustiguer to the spouses Panzo, her
title was cancelled and in lieu thereof TCT No. T-64807 was
issued by the Register of Deeds of Iloilo in the spouses' name
on March 3, 1971. The said spouses then mortgaged the
property to respondent Rural Bank of Pavia for P5,000.00.
Upon their failure to pay the account, respondent bank
foreclosed the mortgage on August 11, 1973 and the bank
was the highest bidder. A certificate of sale was executed by
the Provincial Sheriff in its favor.
On April 18, 1974, petitioner as judicial co-administratrix of the
Intestate Estate of the late Matias Yusay brought an action,
against the spouses Panzo and the respondent Rural Bank
seeking the annulment and cancellation of the title in the name
of the Panzos and the issuance of a new title in favor of
Yusay. In her complaint, 3 petitioner alleged among other
things: that the subject property was first mortgaged to Yusay
on April 30, 1929 by the spouses Sustiguer and Buensuceso;
that sometime November, 1934, said property was verbally
sold to Yusay by the same spouses; that since Yusay bought
the property in 1948, he and his administrator and later plaintiff
administratrix, have been in possession of the property thru
their tenant Elias Daguino until April 15, 1971, when
defendants spouses Panzo wrested possession from their
tenant; that on May 12, 1971, plaintiff administratrix filed an
action, for forcible entry against them before the Municipal
Court of Barotac Nuevo, Iloilo docketed as Civil Case No. 577;
that the trial court having ruled in favor of plaintiffs on
November 4, 1972, defendants spouses appealed the said
decision to the Court of First Instance of Iloilo, where the said
appeal still pends; that defendant Rural Bank was not a
mortgagee in good faith for not having taken the necessary
precaution before accepting the subject property as collateral
for the loan granted the defendants-spouses.
In its answer of May 14,1984 4 defendant Rural Bank set up
the defense of good faith alleging that the certificate of title in
the names of the spouses Panzo was free from any lien and
that the rigid requirements for loan applications had been duly
deserved by the Bank. It further claimed that on August 11,
1973, the mortgage executed by the spouses was foreclosed
and defendant bank being the highest bidder was issued a
certificate of sale by the Provincial Sheriff of Iloilo.
Upon receipt of the answer of defendant Bank, plaintiff on July
15, 1974 moved to dismiss the case as regards defendants
spouses Panzo on the ground that the subject property having
already been sold to defendant Rural Bank, the said spouses
ceased to have any interest in the property. 5 The lower court
acting on this motion ordered the dismissal of the case on July
26, 1974 against the said defendant-spouses only. 6
After trial and submission of the respective memoranda of the
parties, the court a quo addressing itself to the only issue of
whether or not defendant Rural Bank was a mortgagee and
subsequent buyer for value and in good faith ruled in favor of
said defendant. 7
From the decision of the court a quo, petitioner appealed to
the Intermediate Appellate Court which rendered its decision,
subject of this petition, agreement in toto the decision of the
court a quo. Thus:
xxx xxx xxx
This being so, whether or not the bank inspect d
the premises or whether or not the reconstituted
title was void is indeed irrelevant in the land in
question was confiscated for non-payment of
taxes and that it was sold at public auction, for if
so, then at the time of its confiscation, in effect
the land in question lost its Identity as private
land and acquired the status of a government
land to say the least. If sold at public auction
and the buyer was Asuncion Sustiguer, then all
prior ownership there was cancelled, including
that of the original owners, (the spouses
Asuncion Sustiguer and her husband Dioscoro
Buensuceso). Record shows they were later
separated. There is therefore, no conjugal
property to speak of for the exclusive buyer of
the land at the public auction was Asuncion
Sustiguer and she alone. When this was not
redeemed by the couple as they were then
separated, Asuncion Sustiguer became the
exclusive owner of the land on the basis of the
Tax Sale pursuant to Sec. 40 Com. Act No. 470
and Velasquez vs. Coroner, 9 SCRA 986-990.
Its subsequent sale to the Panzos and later its
acquisition by the Rural Bank, the herein
defendant, is now beyond question. 8
In the petition for review before Us, herein petitioner, assigns
the following errors:
I
THE INTERMEDIATE APPELLATE COURT
COMMITTED AN ERROR OF LAW IN
HOLDING THAT THE LAND IN QUESTION
LOST ITS IdENTITY AS A PRIVATE LAND
AND ACQUIRED THE STATUS OF A
GOVERNMENT LAND, WHEN IT WAS SOLD
AT PUBLIC AUCTION FOR NON-PAYMENT
OF TAXES TO THE PROVINCE OF ILOILO,
DIVESTING THE SPOUSES BUENSUCESO
AND THEIR SUCCESSOR-IN-INTEREST,
MATIAS YUSAY, OF THE OWNERSHIP
THEREOF, WITH ASUNCION SUSTIGUER
BECOMING THE EXCLUSIVE OWNER UPON
HER REPURCHASE OF THE SAID LAND
FROM THE PROVINCE OF ILOILO.
II
THE INTERMEDIATE APPELLATE COURT
COMMITTED AN ERROR OF LAW IN NOT
HOLDING THAT THE RECONSTITUTED
TITLE IN THE NAME OF ASUNCION
SUSTIGUER IS VOID FOR WANT OF
JURISDICTION OF THE CADASTRAL COURT
IN RECONSTITUTING THE SAME.
III
THE INTERMEDIATE APPELLATE COURT
COMMITTED AN ERROR OF LAW IN NOT
HOLDING THAT SINCE ADMITTEDLY THE
SPOUSES PANZOS WERE GUILTY OF
FRAUD IN SECURING THE SAID
RECONSTITUTED TITLE IN THE NAME OF
ASUNCION SUSTIGUER FROM THE
CADASTRAL COURT, THEN THEY CAN NOT
TRANSMIT TITLE TO DEFENDANT BANK.
IV
THE INTERMEDIATE APPELLATE COURT
COMMITTED AN ERROR OF LAW IN NOT
HOLDING THAT THE PUBLIC AUCTION SALE
OF THE PROPERTY IN QUESTION IN 1955
FOR NON-PAYMENT OF TAXES IN FAVOR
OF THE PROVINCE OF ILOILO, IS NULL AND
VOID, FOR WANT OF NOTICE TO JOSE S.
YUSAY, THEN ADMINISTRATOR OF THE
ESTATE OF MATIAS YUSAY, HENCE THE
SALE OF THE PROVINCE OF ILOILO IN
FAVOR OF ASUNCION SUSTIGUER AND
FROM HER TO THE SPOUSES PANZOS,
ARE NULL AND VOID.
V
THE INTERMEDIATE APPELLATE COURT
ERRED IN NOT RESOLVING THE
FOLLOWING ERRORS OF FACT OF THE
TRIAL COURT.
(a) The lower court erred in
finding that defendant bank has
made an ocular inspection of the
property prior to the granting of
the loan in favor of the spouses
 Gaudioso Panzo and Hortencia
Buensuceso;
(b) The lower court erred in
holding that defendant bank is
not negligent in not consulting a
lawyer before granting the loan;
(c) The lower court erred in
finding plaintiff as grossly
negligent in not taking steps to
perfect its title over the property.
We affirm the dismissal by the court a quo.
The principal question in this controversy is whether or not the
respondent bank was an innocent mortgagee and subsequent
buyer for value in good faith of the property.
When the certificate of title in the name of the Panzo spouses
was submitted to private respondent bank for purposes of their
loan application, it was free from any lien and encumbrance.
The mortgage was duly constituted and registered with the
Register of Deeds on May 28,1971. The ejectment case which
was filed by petitioner against the said spouses which
petitioner claims should have put the respondent bank on its
guard was annotated at the back of the subject title only on
March 29,1973. There was therefore nothing on the face of the
title of the Panzos which would arouse the suspicion of the
respondent bank. The certificate of title was in the name of the
mortgagors when the land was mortgaged by them to
respondent bank. Such being the case, said respondent bank,
As mortgagee, had the right to rely on what appeared on the
certificate of title and, in the absence of anything to excite
suspicion, was under no obligation to look beyond the
certificate and investigate the title of the mortgagor appearing
on the face of said certificate. 9
To further determine the good faith of the mortgagee Rural
Bank, We must address ourselves to the fifth assigned error
which focuses on the alleged negligence of the respondent
bank in taking the precautionary steps in the processing of the
loan application of the Panzo spouses. The findings of the trial
court which were affirmed by the appellate court ruled out any
negligence of the Rural Bank, thus:
The preponderance of evidence favors
defendant Rural Bank. This Court is satisfied
that an ocular inspection was indeed conducted
by Gorriceta pursuant to established practice
among banks. Assuming, for the sake of
argument, that the Panzo spouses were not in
actual possession of the entire property, the fact
is that they possessed a substantial part thereof
and his possession coincided with the visit of
Gorriceta. At that particular moment, Panzo had
been working for him in the construction of the
building and weeding of the land. These man
had recognized Panzo as the owner of the land
in response to inquiries by Gorriceta to go
around the entire perimeter of the property
because there was nothing to arouse his
suspicion, what with certificate of title in the
name of the Panzos having been submitted to
him. A contrary requirement would negate the
efficacy of a torrens title. In fact, the allegations
 of plaintiff in Civil Case No. 517 (the ejectment
case filed against Gaudencio Panzo and
Hortencia Buensuceso — Annex D of the
complaint in this case), would bear out the claim
of defendant Bank that the Panzos were in
effective possession of the
10
property.
We have examined the records of this case and We find no
cogent reason to disturb the findings of the court below in this
regard. Well-settled is the rule that the findings of facts of the
Court of Appeals are generally final and conclusive upon this
Court. 11
Petitioner now claims that the negligence of respondent bank
consists in its failure to consult a lawyer before approving the
loan of the Panzo spouses. She asserts that had a lawyer
been consulted, the fact that the Panzo's title had been
derived from a reconstituted title would have surfaced. This
would have provoked an inquiry as to the status of the original
title by the lawyer and he would have found out about the
irregularity of the reconstitution proceedings consisting of the
lack of publication and notices.
We agree with the trial court that the respondent Bank was not
negligent in failing to consult a lawyer. The loan application of
the Panzos was subjected to the rigid requirements of the
bank. There was a physical inspection of the property. The
loan application passed thru the scrutiny of the Credit
Committee, the members of which are also the Directors of the
Bank. 12 The mortgage wits then duly registered with the
Register of Deeds.
The credit investigation and approval were undertaken by
responsible officers of the respondent Bank. For the bank to
consult a lawyer would not have made much difference in its
findings.
As the trial court pointed out, the most that a lawyer could
have done was to consult the records in the reconstitution
case which would not reveal anything irregular. It must be
presumed that official duty was duly and properly exercised in
the reconstitution proceedings. 13
The well-known rule in this jurisdiction is that a person dealing
with a registered land has a light to rely upon the face of the
torrens certificate of title and to dispense with the need of
inquiring her except when the party concerned has actual
knowledge of facts and circumstances that would impel a
reasonably cautious man to make inquiry. 14 It has also been
held that a bank is not required, before accepting a mortgage,
to make an investigation of the title of the property being given
as security. 15
Of course, banks are cautioned to exercise more care and
prudence in dealing even with registered lands, than private
individuals, "for their business is one affected with public
interest, keeping in trust money belonging to their depositors,
which they should guard against loss by not committing any
act of negligence which amounts to lack of good faith by which
they would be denied the protective mantle of the land
registration statute Act 496, extended only to purchasers for
value and in good faith, as well as to mortgagees of the same
character and description.16 It is for this reason that banks
before approving a loan send representatives to the premises
of the land offered as collateral and investigate who are the
true owners thereof. 17 In this regard, We believe that
respondent bank had exercised the due care demanded of it
relative to the real estate loan of the Panzos for it to be
considered an innocent mortgagee for value.
If anyone can be faulted for being negligent, it is the petitioner
herself and her predecessors-in-interest. In the complaint,
petitioner alleged that the subject property was sold verbally to
Matias Yusay by the original owners, the spouses
Buensuceso, in November, 1934 (under paragraph 5 of the
same complaint, it was alleged to have been bought by Yusay
in 1948). From that time to the filing of the ejectment case in
May 1971, or a period of almost 37 years, petitioner and her
predecessors did not take any step to perfect their title over
the property. There was not even a tax declaration over the
subject property of Matias Yusay or his successors-in-interest.
When the land was sold at public auction to the Province of
Iloilo in 1955 for
non-payment of taxes, petitioner's brother Jose Yusay, the
administrator of the Yusay estate did not do anything to
redeem the property. Petitioner alleged that the reason why
she and her predecessors had not been paying the taxes was
their mistaken belief that Lot 2161, the subject property, was
Lot 2159, an adjacent lot, 18 the taxes of which were being paid
by her. She further claims that they were not given any notice
of the public auction sale. So it was only in 1971, at the time of
the filing of their ejectment case against the Panzos that
petitioner came to know of said public auction.
Noteworthy is the case of Paguio vs. Ruiz, 19 where this Court
upheld the city treasurer's 1947 tax sale of the delinquent
property despite non-delivery of the treasurer's notices of sale
to the registered owner who was already deceased. We ruled
—
Yet it was her gross negligence which brought
about the appellee's predicament. Knowing her
property to be subject to tax, she neglected to
pay her obligation. Vigorous in her protest that
she was not given opportunity to protect her
rights, she at least neglected to put the
Government in a position to allow her that
opportunity. And this, notwithstanding the
categorical mandate of Section 2482 of the
Revised Administrative Code, which she was
presumed to know, and which makes it the duty
of each person acquiring real estate in the City
to make a new declaration thereof, with the
advertence that failure to do so shall make the
assessment in the name of the previous owner
valid and binding on all persons interested and
for all purposes, as though the same had been
assessed in the name of the actual owner.
Apart from this, the subject property was not even included in
the project of partition and even the re-amended project of
partition over the estate of Matias Yusay after he died in 1948.
What is revealing is that it took them almost 37 years to
discover that there was such a discrepancy.
The law helps the vigilant but not those who sleep on their
rights. For time is a means of destroying obligations and
actions, because time runs against the slothful and
contemners of their own rights. 20 By their inexplicable inaction
for such a long period of time, they are now barred by laches
to lay claim over the property. 21
Moreover, there are several inconsistencies in the evidence of
petitioner ranging from the date of the alleged verbal sale in
favor of Matias Yusay as stated in the complaint 22 to the
testimonies of her witnesses, particularly her tenant Elias
Daguino as to his possession of subject property. 23 Indeed,
the validity of petitioner's claim appears to be questionable.
Respondent bank is no doubt an innocent mortgagee for value
but is it a subsequent purchaser in good faith and for value?
It will be remembered that at the time of the purchase of the
subject property at the foreclosure sale on August 11, 1973,
the notice of lis pendens had already been inscribed in the title
of the Panzos, subject of the mortgage.
It is true that the notice of lis pendens is an announcement to
the whole world that a particular real property is in litigation,
and serves as a warning that one who acquires an interest
over said property does so at his own risk, so that he gambles
on the results of the litigation over said property. 24
However, it has also been held that any subsequent lien or
encumbrance annotated at the back of the certificate of title
cannot in any way prejudice the mortgage previously
registered, and the lots subject thereto pass to the purchaser
at the public auction sale free from any lien or encumbrance.
Otherwise, the value of the mortgage could be easily
destroyed by a subsequent record of an adverse claim, for no
one would purchase at a foreclosure sale if bound by the
posterior claim. 25
In the case of Gomes vs. Government of the Philippine
Islands 26 this Court ruled:
The appealed judgment was finally based on
the fact that both the plaintiff and the intervenor
had succeeded in having notices of lis
pendens noted in transfer certificate of title No.
25909. It seems that it is desired to attribute to
these notations a legal effect similar to a lien.
This is not, however, the effect of a notice of lis
pendens under sections 79 of Act No. 496, and
401 of the Code of Civil Procedure. The
notation of the plaintiffs notice produced no
effect whatsoever against the Government's
mortgage not only because the latter was prior
to the former but also because once the
mortgage is declared valid and effective by final
judgment, the plaintiff can no longer enforce
any preferential right. ... We hold, therefore, that
the notices of lis pendens and the attachment
did not constitute justifiable or lawful cause to
prevent the execution of the judgment of
foreclosure of mortgage obtained by the
Government.
A person who takes a mortgage in good faith and for a
valuable consideration, the record showing a clear title in the
mortgagor will be protected against any equitable titles to the
premises or equitable claims on the title, in favor of their
persons, of which he had no notice, actual or constructive and
that protection extends to a purchaser at a Sheriff s sale under
proceedings on the mortgage although such purchaser had
notice of the alleged equity. 27
In the case at bar, it is the respondent bank, the mortgagee
itself, which purchased the subject property in the foreclosure
sale. Being an innocent mortgagee with a superior lien over
that of petitioner, its right to a foreclosure of the property is
reserved. 28 The notice of lis pendens which antedated the
foreclosure and sale at public auction of subject property could
not affect the rights of the respondent bank because the
foreclosure sale retroacts to the date of registration of the
mortgage. 29 Its character of being an innocent mortgagee
continues up to the date of actual foreclosure and sale at
public auction.
At any rate, even if the pending litigation between petitioner
and the Panzos be finally decided in favor of the former, it will
have no effect on the ownership rights of the respondent bank
over the subject property since a forcible entry suit is not
conclusive as to ownership but only as to possession. 30
Petitioner, in the rest of the assigned errors, persists in
questioning the validity of the titles of the respondent bank's
predecessors-in-interest, not only the title of its immediate
transferor, the Panzo spouses but even that of Asuncion
Sustiguer, seeking a declaration of their nullity.
Furthermore, petitioner contends that notwithstanding the
good faith of the respondent bank, its title over the subject
property is fatally defective since the title of its predecessors
are null and void.
Respondent Bank, however, maintains that the arguments of
petitioner constitute a collateral attack on said titles. We find
merit in this contention.
Asuncion Sustiguer from whom the Panzo spouses obtained
their title was never made a party to the proceedings. Her title
was acquired from the Province of Iloilo which in turn acquired
the property way back in 1955 at a sale at public auction. As to
the Panzo spouses, they were originally defendants in this
case but on petitioner's motion, they were dropped from the
complaint even before they had the opportunity to file their
answer. Thus, the case proceeded against the respondent
bank alone.
It is well-settled that a Torrens Title cannot be collaterally
attacked. The issue on the validity of the title can only be
raised in an action expressly instituted for that
purpose. 31
A Torrens Title can be attacked only for fraud within one year
after the date of the issuance of the decree of registration.
Such attack must be direct and not by collateral proceeding.
The title represented by the certificate cannot be changed,
altered, modified, enlarged or diminished in a collateral
proceeding. 32
After one year from the date of the degree, the sole remedy of
the landowner whose property has been wrongfully or
erroneously registered in another's name is not to set aside
the decree, but, respecting the decree as incontrovertible and
no longer open to review, to bring an ordinary action in the
ordinary court of justice for reconveyance or, if the property
has passed into the hands of an innocent purchaser for value,
for damages. 33
The title of Asuncion Sustiguer was obtained on February 26,
1971 while that of the Panzos on March 3, 1971. The
complaint in this acto, was filed only on April 18, 1974, clearly
more than one year from the date of the decree of registration.
The disputed titles by then had become indefeasible. Since the
property had already been acquired by respondent bank at the
foreclosure sale, as an innocent purchaser for value, an action
for reconveyance cannot prosper. The only remedy of
petitioner is an action for damages against the person whom
she claims procured the wrongful registration in his name. 34
Nevertheless, even assuming that the validity of the titles of
Asuncion Sustiguer and the Panzo spouses may be
questioned in these proceedings and such titles may be
declared null and void, it will still be of no moment in this case.
Where the torrens title of the land was in the name of the
mortgagor and later given as security for a bank loan, the
subsequent declaration of said title as null and void is not a
ground for nullifying the mortgage right of the bank, which had
acted in good faith. 35 Being thus an innocent mortgagee for
value, its right or lien upon the land mortgaged must be
respected and protected, even if the mortgagors obtained their
title thereto thru fraud. 36
WHEREFORE, the decision of respondent Intermediate
Appellate Court of November 15, 1983 agreement in totowith
costs the decision of the Court of First Instance of Iloilo dated
July 16, 1975 is hereby AFFIRMED without pronouncement as
to costs.
SO ORDERED.
Teehankee, C.J., Narvasa, Cruz and Paras, JJ., concur.
ESTATE OF THE LATE G.R. No. 168661
JESUS S. YUJUICO, represented
by ADMINISTRATORS
BENEDICTO V. YUJUICO and Present:
EDILBERTO V. YUJUICO; and
AUGUSTO Y. CARPIO, QUISUMBING, J., Chairperson,
Petitioners, CARPIO MORALES,
TINGA,
VELASCO, JR., and
- versus - NACHURA,* JJ.
REPUBLIC OF THE PHILIPPINES Promulgated:
and the COURT OF APPEALS,
Respondents. October 26, 2007
x----------------------------------------------------------------------------------
-------x
DECISION
VELASCO, JR., J.:
In 1973, Fermina Castro filed an application for the registration
and confirmation of her title over a parcel of land with an area
of 17,343 square meters covered by plan (LRC) Psu-964
located in the Municipality of Paraaque, Province of Rizal (now
Paraaque City), in the Pasig-Rizal Court of First Instance
(CFI), Branch 22. The application was docketed LRC Case
No. N-8239. The application was opposed by the Office of the
Solicitor General (OSG) on behalf of the Director of Lands,
and by Mercedes Dizon, a private party. Both oppositions were
stricken from the records since the opposition of Dizon was
filed after the expiration of the period given by the court, and
the opposition of the Director of Lands was filed after the entry
of the order of general default. After considering the evidence,
the trial court rendered its April 26, 1974 Decision. The
dispositive portion reads:

____________________________
* As per September 3, 2007 raffle.
WHEREFORE, the Court hereby declares the
applicant, Fermina Castro, of legal age, single,
Filipino and a resident of 1515 F. Agoncillo St.,
Corner J. Escoda St., Ermita, Manila, the true
and absolute owner of the land applied for
situated in the Municipality of Paraaque,
Province of Rizal, with an area of 17,343 square
meters and covered by plan (LRC) Psu-964 and
orders the registration of said parcel of land in
her name with her aforementioned personal
circumstances.
Once this decision becomes final and
executory, let the corresponding order for the
issuance of the decree be issued.
SO ORDERED.[1]
The Director of Lands and Mercedes Dizon did not appeal
from the adverse decision of the Pasig-Rizal CFI. Thus, the
order for the issuance of a decree of registration became final,
and Decree No. N-150912 was issued by the Land
Registration Commission (LRC).[2] Original Certificate of Title
(OCT) No. 10215 was issued in the name of Fermina Castro
by the Register of Deeds for the Province of Rizal on May 29,
1974.[3]
The land was then sold to Jesus S. Yujuico, and OCT
No. 10215 was cancelled. On May 31, 1974,[4] Transfer
Certificate of Title (TCT) No. 445863 was issued in Yujuicos
name, who subdivided the land into two lots. TCT No.
446386[5] over Lot 1 was issued in his name, while TCT No. S-
29361[6] over Lot 2 was issued in the name of petitioner
Augusto Y. Carpio.
Annotations at the back of TCT No. 446386 show that Yujuico
had, at one time or another, mortgaged the lot to the Philippine
Investments System Organization (PISO) and Citibank,
N.A. Annotations in the title of petitioner Carpio reveal the lot
was mortgaged in favor of Private Development Corporation
(PDC), Rizal Commercial Banking Corporation (RCBC) and
then Philippine Commercial and Industrial Bank (PCIB) and
the Development Bank of the Philippines (DBP) to secure
various loans.
Sometime in 1977, Presidential Decree No. (PD) 1085
entitled Conveying the Land Reclaimed in the Foreshore and
Offshore of the Manila Bay (The Manila-Cavite Coastal Road
Project) as Property of the Public Estates Authority as well as
Rights and Interests with Assumptions of Obligations in the
Reclamation Contract Covering Areas of the Manila Bay
between the Republic of the Philippines and the Construction
and Development Corporation of the Philippines (1977) was
issued. Land reclaimed in the foreshore and offshore areas
of Manila Bay became the properties of the Public Estates
Authority (PEA), a government corporation that undertook the
reclamation of lands or the acquisition of reclaimed
lands. On January 13, 1989, OCT No. SP 02 was issued in
favor of PEA. The PEA also acquired ownership of other
parcels of land along the Manila Bay coast, some of which
were subsequently sold to the Manila Bay Development
Corporation (MBDC), which in turn leased portions to Uniwide
Holdings, Inc.[7]
The PEA undertook the construction of the Manila Coastal
Road. As this was being planned, Yujuico and Carpio
discovered that a verification survey they commissioned
showed that the road directly overlapped their property, and
that they owned a portion of the land sold by the PEA to the
MBDC.
On July 24, 1996, Yujuico and Carpio filed before the
Paraaque City Regional Trial Court (RTC), a complaint for the
Removal of Cloud and Annulment of Title with Damages
docketed as Civil Case No. 96-0317 against the PEA. On May
15, 1998 the parties entered into a compromise agreement
approved by the trial court in a Resolution dated May 18,
1998. On June 17, 1998, the parties executed a Deed of
Exchange of Real Property, pursuant to the compromise
agreement, where the PEA property with an area of 1.4007
hectares would be conveyed to Jesus Yujuico and petitioner
Carpio in exchange for their property with a combined area of
1.7343 hectares.
On July 31, 1998, the incumbent PEA General Manager,
Carlos P. Doble, informed the OSG that the new PEA board
and management had reviewed the compromise agreement
and had decided to defer its implementation and hold it in
abeyance following the view of the former PEA General
Manager, Atty. Arsenio Yulo, Jr., that the compromise
agreement did not reflect a condition of the previous PEA
Board, requiring the approval of the Office of the
President.The new PEA management then filed a petition for
relief from the resolution approving the compromise
agreement on the ground of mistake and excusable
negligence.
The petition was dismissed by the trial court on the
ground that it was filed out of time and that the allegation of
mistake and excusable negligence lacked basis.
The PEA fared no better in the Court of Appeals (CA),
as the petition was dismissed for failure to pay the required
docket fees and for lack of merit.
The matter was raised to the Supreme Court in Public
Estates Authority v. Yujuico[8] but PEAs petition was denied,
upholding the trial courts dismissal of the petition for relief for
having been filed out of time. The allegation of fraud in the
titling of the subject property in the name of Fermina Castro
was not taken up by the Court.
On June 8, 2001, in a Complaint for Annulment and
Cancellation of Decree No. N-150912 and its Derivative Titles,
entitled Republic of the Philippines v. Fermina Castro, Jesus
S. Yujuico, August Y. Carpio and the Registry of Deeds of
Paraaque City docketed as Civil Case No. 01-0222, filed with
the Paraaque City RTC, respondent Republic of the
Philippines, through the OSG, alleged that when the land
registered to Castro was surveyed by Engr. H. Obreto on
August 3, 1972 and subsequently approved by the LRC on
April 23, 1973, the land was still a portion of Manila Bay as
evidenced by Namria Hydrographic Map No. 4243, Surveys to
1980; 1st Ed/. January 9/61: Revised 80-11-2; that Roman
Mataverde, the then OIC of the Surveys Division, Bureau of
Lands, informed the OIC of the Legal Division that [w]hen
projected on Cadastral Maps CM 14 deg. 13 N-120 deg, 59E,
Sec.2-A of Paraaque Cadastre (Cad. 299), (LRC) Psu-964
falls inside Manila Bay, outside Cad. 299; that then Acting
Regional Lands Director Narciso V. Villapando issued a
Report dated November 15, 1973 stating that plan (LRC) Psu-
964 is a portion of Manila Bay; that then Officer-in-Charge,
Assistant Director of Lands, Ernesto C. Mendiola, submitted
his Comment and Recommendation re: Application for
Registration of Title of FERMINA CASTRO, LRC Case No. N-
8239, dated Dec. 1, 1977, praying that the instant registration
case be dismissed; and that Fermina Castro had no
registrable rights over the property.
More significantly, respondent Republic argued that, first,
since the subject land was still underwater, it could not be
registered in the name of Fermina Castro.Second, the land
registration court did not have jurisdiction to adjudicate
inalienable lands, thus the decision adjudicating the subject
parcel of land to Fermina Castro was void. And third, the titles
of Yujuico and Carpio, being derived from a void title, were
likewise void.[9]
On September 13, 2001, Yujuico and Carpio filed a
Motion to Dismiss (With Cancellation of Notice of Lis
Pendens),[10] on the grounds that: (1) the cause of action was
barred by prior judgment; (2) the claim had been waived,
abandoned, or otherwise extinguished; (3) a condition
precedent for the filing of the complaint was not complied with;
and (4) the complaint was not verified and the certification
against forum shopping was not duly executed by the plaintiff
or principal party.
On November 27, 2001, respondent Republic filed an
Opposition[11] to the motion to dismiss to which defendants
filed a Reply[12] on January 14, 2002, reiterating the grounds
for the motion to dismiss.
In the August 7, 2002 Order of the RTC,[13] Civil Case
No. 01-0222 was dismissed. The trial court stated that the
matter had already been decided in LRC Case No. N-8239,
and that after 28 years without being contested, the case had
already become final and executory. The trial court also found
that the OSG had participated in the LRC case, and could have
questioned the validity of the decision but did not. Civil Case
No. 01-0222 was thus found barred by prior judgment.
On appeal to the CA, in CA-G.R. CV No. 76212,
respondent Republic alleged that the trial court erred in
disregarding that appellant had evidence to prove that the
subject parcel of land used to be foreshore land of the Manila
Bay and that the trial court erred in dismissing Civil Case No.
01-0222 on the ground of res judicata.[14]
The CA observed that shores are properties of the public
domain intended for public use and, therefore, not registrable
and their inclusion in a certificate of title does not convert the
same into properties of private ownership or confer title upon
the registrant.
Further, according to the appellate court res
judicata does not apply to lands of public domain, nor does
possession of the land automatically divest the land of its
public character.
The appellate court explained that rulings of the
Supreme Court have made exceptions in cases where the
findings of the Director of Lands and the Department of
Environment and Natural Resources (DENR) were conflicting
as to the true nature of the land in as much as reversion efforts
pertaining foreshore lands are embued with public interest.
The dispositive portion of the CA decision reads,
WHEREFORE, premises considered, the
present appeal is hereby GRANTED. The
appealed Order dated August 7, 2002 of the
 trial court in Civil Case No. 01-0222 is hereby A. IN THE FIRESTONE CASE, THE
REVERSED and SET ASIDE. The case is HONORABLE COURT APPLIED
hereby REMANDED to said court for further THE PRINCIPLE OF RES
proceedings and a full-blown trial on the merits JUDICATA NOTWITHSTANDING
with utmost dispatch.[15] ALLEGATIONS OF LACK OF
JURISDICTION OF A LAND
Hence, this petition. REGISTRATION COURT,
FORECLOSING ANY FURTHER
The Issues ATTEMPT BY RESPONDENT
THEREIN, AS IN THE INSTANT
Petitioners now raise the following issues before this Court: CASE, TO RESURRECT A LONG-
SETTLED JUDICIAL
DETERMINATION OF
THE COURT OF APPEALS COMMITTED REGISTRABILITY OF A PARCEL
REVERSIBLE ERROR AND DECIDED A OF LAND BASED ON THE SHEER
QUESTION OF SUBSTANCE IN A WAY NOT ALLEGATION THAT THE SAME IS
IN ACCORDANCE WITH LAW AND THE PART OF THE PUBLIC DOMAIN.
APPLICABLE DECISIONS OF THE
HONORABLE COURT AND HAS DEPARTED B. THE LAND REGISTRATION
FROM THE ACCEPTED AND USUAL COURT HAD JURISDICTION TO
COURSE OF JUDICIAL PROCEEDINGS DETERMINE WHETHER
NECESSITATING THE HONORABLE THE SUBJECT LAND WAS PART
COURTS EXERCISE OF ITS POWER OF OF THE PUBLIC DOMAIN.
SUPERVISION CONSIDERING THAT:
C. RESPONDENTS REVERSION
I. THE REVERSAL BY THE CASE SEEKS TO RETRY THE
COURT OF APPEALS OF THE TRIAL VERY SAME FACTUAL ISSUES
COURTS APPLICATION OF THE PRINCIPLE THAT HAVE ALREADY BEEN
OF RES JUDICATA IN THE INSTANT CASE IS JUDICIALLY DETERMINED OVER
BASED ON ITS ERRONEOUS ASSUMPTION THIRTY (30) YEARS AGO.
THAT THE SUBJECT LAND IS OF PUBLIC
DOMAIN, ALLEGEDLY PART D. THE JURISPRUDENTIAL BASES
OF MANILA BAY. APPLIED BY THE COURT OF
APPEALS IN ITS QUESTIONED
 DECISION ARE MISPLACED, THE HONORABLE COURT IN
CONSIDERING THAT THEY ARE THE PEA CASE.
ALL PREDICATED ON THE
ERRONEOUS PREMISE THAT IT IV. EQUITABLE CONSIDERATIONS
IS UNDISPUTED THAT MANDATE THE APPLICATION OF THE
THE SUBJECT LAND IS PART OF RULE ON ORDINARY ESTOPPEL AND
THE PUBLIC DOMAIN. LACHES IN THE INSTANT CASE
AGAINST RESPONDENT.
II. RESPONDENT IS BARRED BY
JURISDICTIONAL ESTOPPEL AND V. RESPONDENT CANNOT BE GIVEN
LACHES FROM QUESTIONING SPECIAL CONSIDERATION AND
THE JURISDICTION OF THE LAND EXCUSED FOR TRANSGRESSING
REGISTRATION COURT. RULES OF PROCEDURE.[16]

III. RELIANCE BY THE COURT OF

APPEALS ON THE ISOLATED
PRONOUNCEMENT OF THE Essentially, the issues boil down to three: (1) Is a
HONORABLE COURT IN THE PEA CASE reversion suit proper in this case? (2) Is the present petition
IS UNWARRANTED AND MISLEADING estopped by laches? (3) Did the CA erroneously apply the
CONSIDERING THAT THE MATTER principle of res judicata?
OF WHETHER RES JUDICATA APPLIES
WITH RESPECT TO THE LAND An action for reversion seeks to restore public land
REGISTRATION COURTS DECISION IN fraudulently awarded and disposed of to private individuals or
1974 WAS NOT IN ISSUE IN SAID CASE. corporations to the mass of public domain.[17] This remedy is
provided under Commonwealth Act (CA) No. 141 (Public Land
A. THE INSTANT REVERSION Act) which became effective on December 1, 1936. Said law
CASE IS NOT THE PROPER recognized the power of the state to recover lands of public
RECOURSE. domain. Section 124 of CA No. 141 reads:

B. THE VALIDITY OF THE COURT- SEC. 124. Any acquisition, conveyance,

APPROVED COMPROMISE alienation, transfer, or other contract made or
AGREEMENT 15 MAY 1998 HAS executed in violation of any of the provisions of
ALREADY BEEN AFFIRMED BY Sections one hundred and eighteen, one
hundred and twenty, one hundred and twenty
 one, one hundred and twenty-two, and one
hundred twenty-three of this Act shall be
unlawful and null and void from its execution
and shall produce the effect of annulling and
cancelling the grant, title, patent, or permit
originally issued, recognized or confirmed,
actually or presumptively, and cause the
reversion of the property and its
improvements to the State. (Emphasis
supplied.)
Pursuant to Section 124 of the Public Land Act,
reversion suits are proper in the following instances, to wit:
1. Alienations of land acquired under free patent or
homestead provisions in violation of Section
118, CA No. 141;
2. Conveyances made by non-Christians in violation of
Section 120, CA No. 141; and
3. Alienations of lands acquired under CA No. 141 in
favor of persons not qualified under Sections
121, 122, and 123 of CA No. 141.
From the foregoing, an action for reversion to cancel
titles derived from homestead patents or free patents based on
transfers and conveyances in violation of CA No. 141 is filed
by the OSG pursuant to its authority under the Administrative
Code with the RTC. It is clear therefore that reversion suits
were originally utilized to annul titles or patents
administratively issued by the Director of the Land
Management Bureau or the Secretary of the DENR.
While CA No. 141 did not specify whether judicial
confirmation of titles by a land registration court can be subject
of a reversion suit, the government availed of such remedy by
filing actions with the RTC to cancel titles and decrees granted
in land registration applications.
The situation changed on August 14, 1981 upon
effectivity of Batas Pambansa (BP) Blg. 129 which gave the
Intermediate Appellate Court the exclusive original jurisdiction
over actions for annulment of judgments of RTCs.
When the 1997 Rules of Civil Procedure became
effective on July 1, 1997, it incorporated Rule 47 on annulment
of judgments or final orders and resolutions of the RTCs. The
two grounds for annulment under Sec. 2, Rule 47 are extrinsic
fraud and lack of jurisdiction. If based on extrinsic fraud, the
action must be filed within four (4) years from its discovery,
and if based on lack of jurisdiction, before it is barred by
laches or estoppel as provided by Section 3, Rule 47. Thus,
effective July 1, 1997, any action for reversion of public land
instituted by the Government was already covered by Rule 47.
The instant Civil Case No. 01-0222 for annulment and
cancellation of Decree No. N-150912 and its derivative titles
was filed on June 8, 2001 with the Paraaque City RTC. It is
clear therefore that the reversion suit was erroneously
instituted in the Paraaque RTC and should have been
dismissed for lack of jurisdiction. The proper court is the CA
which is the body mandated by BP Blg. 129 and prescribed by
Rule 47 to handle annulment of judgments of RTCs.
 In Collado v. Court of Appeals,[18] the government,
represented by the Solicitor General pursuant to Section 9(2)
of BP Blg. 129, filed a petition for annulment of judgment with
the CA. Similarly in the case of Republic v. Court of
Appeals,[19] the Solicitor General correctly filed the annulment
of judgment with the said appellate court.
This was not done in this case. The Republic misfiled
the reversion suit with the Paraaque RTC. It should have been
filed with the CA as required by Rule 47. Evidently, the
Paraaque RTC had no jurisdiction over the instant reversion
case.
Assuming that the Paraaque RTC has jurisdiction over
the reversion case, still the lapse of almost three decades in
filing the instant case, the inexplicable lack of action of the
Republic and the injury this would cause constrain us to rule
for petitioners. While it may be true that estoppel does not
operate against the state or its agents,[20] deviations have been
allowed. In Manila Lodge No. 761 v. Court of Appeals, we
said:
Estoppels against the public are little
favored. They should not be invoked except in
rare and unusual circumstances, and may not
be invoked where they would operate to defeat
the effective operation of a policy adopted to
protect the public. They must be applied with
circumspection and should be applied only in
those special cases where the interests of
justice clearly require it. Nevertheless, the
government must not be allowed to deal
dishonorably or capriciously with its
citizens, and must not play an ignoble part
or do a shabby thing; and subject to
limitations x x x, the doctrine of equitable
estoppel may be invoked against public
authorities as well as against private
individuals.[21] (Emphasis supplied.)
Equitable estoppel may be invoked against public
authorities when as in this case, the lot was already alienated
to innocent buyers for value and the government did not
undertake any act to contest the title for an unreasonable
length of time.
In Republic v. Court of Appeals, where the title of an
innocent purchaser for value who relied on the clean
certificates of the title was sought to be cancelled and the
excess land to be reverted to the Government, we ruled that
[i]t is only fair and reasonable to apply the equitable
principle of estoppel by laches against the government to
avoid an injustice to innocent purchasers for
value (emphasis supplied).[22] We explained:
Likewise time-settled is the doctrine that
where innocent third persons, relying on the
correctness of the certificate of title, acquire
rights over the property, courts cannot disregard
such rights and order the cancellation of the
certificate. Such cancellation would impair
public confidence in the certificate of title, for
everyone dealing with property registered under
the Torrens system would have to inquire in
every instance whether the title has been
regularly issued or not. This would be contrary
to the very purpose of the law, which is to
stabilize land titles. Verily, all persons dealing
with registered land may safely rely on the
correctness of the certificate of title issued
therefore, and the law or the courts do not
oblige them to go behind the certificate in order
to investigate again the true condition of the
property. They are only charged with notice of
the liens and encumbrances on the property
that are noted on the certificate.[23]
xxxx
But in the interest of justice and equity,
neither may the titleholder be made to bear the
unfavorable effect of the mistake or negligence
of the States agents, in the absence of proof of
his complicity in a fraud or of manifest damage
to third persons. First, the real purpose of
the Torrens system is to quiet title to land to put
a stop forever to any question as to the legality
of the title, except claims that were noted in the
certificate at the time of the registration or that
may arise subsequent thereto.Second, as we
discussed earlier, estoppel by laches now bars
petitioner from questioning private respondents
titles to the subdivision lots. Third, it was never
proven that Private Respondent St. Jude was a
party to the fraud that led to the increase in the
area of the property after its subdivision. Finally,
because petitioner even failed to give sufficient
proof of any error that might have been
committed by its agents who had surveyed the
property, the presumption of regularity in the
performance of their functions must be
respected. Otherwise, the integrity of
the Torrens system, which petitioner
purportedly aims to protect by filing this case,
shall forever be sullied by the ineptitude and
inefficiency of land registration officials, who are
ordinarily presumed to have regularly performed
their duties.[24]
Republic v. Court of Appeals is reinforced by our ruling
in Republic v. Umali,[25] where, in a reversion case, we held
that even if the original grantee of a patent and title has
obtained the same through fraud, reversion will no longer
prosper as the land had become private land and the
fraudulent acquisition cannot affect the titles of innocent
purchasers for value.
Considering that innocent purchaser for value Yujuico
bought the lot in 1974, and more than 27 years had elapsed
before the action for reversion was filed, then said action is
now barred by laches.
While the general rule is that an action to recover lands
of public domain is imprescriptible, said right can be barred by
laches or estoppel. Section 32 of PD 1592 recognized the
rights of an innocent purchaser for value over and above the
interests of the government. Section 32 provides:
SEC. 32. Review of decree of
registration; Innocent purchaser for value.The
decree of registration shall not be reopened or
revised by reason of absence, minority, or other
disability of any person adversely affected
 thereby, nor by any proceeding in any court for
reversing judgments, subject, however, to the
right of any person, including the
government and the branches thereof,
deprived of land or of any estate or interest
therein by such adjudication or confirmation
of title obtained by actual fraud, to file in the
proper Court of First Instance a petition for
reopening and review of the decree of
registration not later than one year from and
after the date of the entry of such decree of
registration, but in no case shall such
petition be entertained by the court where
an innocent purchaser for value has
acquired the land or an interest therein,
whose rights may be prejudiced. Whenever
the phrase innocent purchaser for value or an
equivalent phrase occurs in this Decree, it shall
be deemed to include an innocent lessee,
mortgagee, or other encumbrances for
value. (Emphasis supplied.)
In this petition, the LRC (now LRA), on May 30, 1974,
issued Decree No. N-150912 in favor of Fermina Castro and
OCT No. 10215 was issued by the Rizal Registrar of Deeds
on May 29, 1974. OCT No. 10215 does not show any
annotation, lien, or encumbrance on its face. Relying on the
clean title, Yujuico bought the same in good faith and for value
from her. He was issued TCT No. 445863 on May 31,
1974. There is no allegation that Yujuico was a buyer in bad
faith, nor did he acquire the land fraudulently. He thus had the
protection of the Torrens System that every subsequent
purchaser of registered land taking a certificate of title for
value and in good faith shall hold the same free from all
encumbrances except those noted on the certificate and any
of the x x x encumbrances which may be subsisting.[26] The
same legal shield redounds to his successors-in-interest, the
Yujuicos and Carpio, more particularly the latter since Carpio
bought the lot from Jesus Y. Yujuico for value and in good
faith.
Likewise protected are the rights of innocent
mortgagees for value, the PISO, Citibank, N.A., PDC, RCBC,
PCIB, and DBP. Even if the mortgagors title was proved
fraudulent and the title declared null and void, such declaration
cannot nullify the mortgage rights of a mortgagee in good
faith.[27]
All told, a reversion suit will no longer be allowed at this
stage.
More on the issue of laches. Laches is the failure or
neglect, for an unreasonable and unexplained length of time,
to do that which by exercising due diligence could or should
have been done earlier. It is negligence or omission to assert a
right within a reasonable time, warranting a presumption that
the party entitled thereto has either abandoned or declined to
assert it.[28]
When respondent government filed the reversion case
in 2001, 27 years had already elapsed from the time the late
Jesus Yujuico purchased the land from the original owner
Castro. After the issuance of OCT No. 10215 to Castro, no
further action was taken by the government to question the
issuance of the title to Castro until the case of Public Estates
Authority, brought up in the oral argument before this Court
on September 6, 2000.[29] We then held that allegation of fraud
in the issuance of the title was not proper for consideration and
determination at that stage of the case.
From the undisputed facts of the case, it is easily
revealed that respondent Republic took its sweet time to nullify
Castros title, notwithstanding the easy access to ample
remedies which were readily available after OCT No. 10215
was registered in the name of Castro. First, it could have
appealed to the CA when the Pasig-Rizal CFI rendered a
decision ordering the registration of title in the name of
applicant Castro on April 26, 1974. Had it done so, it could
have elevated the matter to this Court if the appellate court
affirms the decision of the land registration court. Second,
when the entry of Decree No. N-150912 was made on May 29,
1974 by the Rizal Register of Deeds, the Republic had one (1)
year from said date or up to May 28, 1975 to file a petition for
the reopening and review of Decree No. N-150912 with the
Rizal CFI (now RTC) on the ground of actual fraud under
section 32 of PD 1592. Again, respondent Republic did not
avail of such remedy. Third, when Jesus Yujuico filed a
complaint for Removal of Cloud and Annulment of Title with
Damages against PEA before the Paraaque RTC in Civil Case
No. 96-0317, respondent could have persevered to question
and nullify Castros title. Instead, PEA undertook a compromise
agreement on which the May 18, 1998 Resolution[30] was
issued. PEA in effect admitted that the disputed land was
owned by the predecessors-in-interest of petitioners and their
title legal and valid; and impliedly waived its right to contest the
validity of said title; respondent Republic even filed the petition
for relief from judgment beyond the time frames allowed by the
rules, a fact even acknowledged by this Court in Public
Estates Authority. Lastly, respondent only filed the reversion
suit on June 8, 2001 after the passage of 27 years from the
date the decree of registration was issued to Fermina Castro.
Such a Rip Van Winkle, coupled with the signing of the
settlement with PEA, understandably misled petitioners to
believe that the government no longer had any right or interest
in the disputed lot to the extent that the two lots were even
mortgaged to several banks including a government financing
institution.Any nullification of title at this stage would unsettle
and prejudice the rights and obligations of innocent parties. All
told, we are constrained to conclude that laches had set in.
Even granting arguendo that respondent Republic is
not precluded by laches from challenging the title of petitioners
in the case at bar, still we find that the instant action for
reversion is already barred by res judicata.
Petitioners relying on Firestone Ceramics, Inc. v. Court
of Appeals[31] as a precedent to the case at bar contend that
the instant reversion suit is now barred by res judicata.
We agree with petitioners.
The doctrine on precedents is expressed in the latin
maximStare decisis et non quieta movere. Follow past
precedents and do not disturb what has been settled.[32] In
order however that a case can be considered as a precedent
to another case which is pending consideration, the facts of
the first case should be similar or analogous to the second
case.
A perusal of the facts of the Firestone case and those
of the case at bar reveals that the facts in the two (2) cases
are parallel. First, in Firestone and in this case, the claimants
filed land registration applications with the CFI; both claimants
obtained decrees for registration of lots applied for and were
issued OCTs. Second, in Firestone, the Republic filed a
reversion case alleging that the land covered by the OCT was
still inalienable forest land at the time of the application and
hence the Land Registration Court did not acquire jurisdiction
to adjudicate the property to the claimant. In the instant case,
respondent Republic contend that the land applied for by
Yujuico was within Manila Bay at the time of application and
therefore the CFI had no jurisdiction over the subject matter of
the complaint. Third, in Firestone, the validity of the title of the
claimant was favorably ruled upon by this Court in G.R. No.
109490 entitled Patrocinio E. Margolles v. CA. In the case at
bar, the validity of the compromise agreement involving the
disputed lot was in effect upheld when this Court in Public
Estates Authority v. Yujuico dismissed the petition of PEA
seeking to reinstate the petition for relief from the May 18,
1998 Resolution approving said compromise agreement. With
the dismissal of the petition, the May 18, 1998 Resolution
became final and executory and herein respondent Republic
through PEA was deemed to have recognized Castros title
over the disputed land as legal and valid. In Romero v.
Tan,[33] we ruled that a judicial compromise has the effect
of res judicata. We also made clear that a judgment based on
a compromise agreement is a judgment on the merits, wherein
the parties have validly entered into stipulations and the
evidence was duly considered by the trial court that approved
the agreement. In the instant case, the May 18, 1998
Resolution approving the compromise agreement confirmed
the favorable decision directing the registration of the lot to
Castros name in LRC Case No. N-8239. Similarly,
in Firestone, the Margolles case confirmed the decision
rendered in favor of Gana in Land Registration Case No. 672
ordering the issuance of the decree to said applicant. Fourth,
in Firestone, the Supreme Court relied on the letter of then
Solicitor General Francisco Chavez that the evidence of the
Bureau of Lands and the LRC was not sufficient to support an
action for cancellation of OCT No. 4216. In the instant case,
both the Solicitor General and the Government Corporate
Counsel opined that the Yujuico land was not under water and
that there appears to be no sufficient basis for the Government
to institute the action for annulment. Fifth, in Firestone, we
ruled that the Margolles case had long become final, thus
the validity of OCT No. 4216 should no longer be disturbed
and should be applied in the instant case (reversion suit)
based on the principle of res judicata or, otherwise, the rule on
conclusiveness of judgment.[34]
Clearly from the above, Firestone is a precedent
case. The Public Estates Authority had become final and thus
the validity of OCT No. 10215 issued to Castro could no longer
be questioned.
While we said in Public Estates Authority that the court
does not foreclose the right of the Republic from pursuing the
proper recourse in a separate proceedings as it may deem
warranted, the statement was obiter dictum since the inquiry
on whether or not the disputed land was still under water at the
time of its registration was a non-issue in the said case.
Even granting for the sake of argument
that Firestone is not squarely applicable, still we find the
reversion suit already barred by res judicata.
For res judicata to serve as an absolute bar to a
subsequent action, the following requisites must concur: (1)
there must be a final judgment or order; (2) the court rendering
it must have jurisdiction over the subject matter and the
parties; (3) it must be a judgment or order on the merits; and
(4) there must be between the two cases, identity of parties,
subject matter and causes of action.[35]
There is no question as to the first, third and last
requisites. The threshold question pertains to the second
requisite, whether or not the then Pasig-Rizal CFI, Branch 22
had jurisdiction over the subject matter in LRC Case No. N-
8239. In Civil Case No. 01-0222, the Paraaque City RTC,
Branch 257 held that the CFI had jurisdiction. The CA
reversed the decision of the Paraaque City RTC based on the
assertion of respondent Republic that the Pasig-Rizal CFI had
no jurisdiction over the subject matter, and that there was a
need to determine the character of the land in question.
The Paraaque City RTC Order dismissing the case
for res judicata must be upheld.
The CA, in rejecting the dismissal of the reversion case
by the Paraaque RTC, relied on two cases,
namely: Municipality of Antipolo v. Zapanta[36] and Republic v.
Vda. De Castillo.[37]
In Municipality of Antipolo, we held that the land
registration court had no jurisdiction to entertain any land
registration application if the land was public property, thus:
Since the Land Registration Court had no
jurisdiction to entertain the application for
registration of public property of ANTIPOLO, its
Decision adjudicating the DISPUTED
PROPERTY as of private ownership is null and
void. It never attained finality, and can be
attacked at any time. It was not a bar to the
action brought by ANTIPOLO for its annulment
by reason of res judicata.
[x x x] the want of jurisdiction by a court
over the subject matter renders the
judgment void and a mere nullity, and
considering that a void judgment is in
legal effect no judgment, by which no
rights are divested, from which no rights
can be obtained, which neither binds nor
bars any one, and under which all acts
performed and all claims flowing out of
are void, and considering, further, that
the decision, for want of jurisdiction of
the court, is not a decision in
contemplation of law, and hence, can
never become executory, it follows that
such a void judgment cannot constitute
a bar to another case by reason of res
judicata.
xxxx
It follows that if a person obtains a title
under the Public Land Act which
includes, by oversight, lands which
cannot be registered under the Torrens
System, or when the Director of Lands
did not have jurisdiction over the same
because it is a public forest, the grantee
does not, by virtue of the said certificate
of title alone, become the owner of the
land illegally included (Republic vs.
Animas, 56 SCRA 499, 503; Ledesma
vs. Municipality of Iloilo, 49 Phil. 769).
[x x x x]

Under these circumstances, the
certificate of title may be ordered
cancelled (Republic vs. Animas, et
al., supra), and the cancellation maybe
pursued through an ordinary action
therefore. This action cannot be barred
by the prior judgment of the land
registration court, since the said court
had no jurisdiction over the subject
matter. And if there was no such
jurisdiction, then the principle of res
judicata does not apply. [x x x] Certainly,
one of the essential requisites, i.e.,
jurisdiction over the subject matter, is
absent in this case. (Italics supplied).[38]
The plain import of Municipality of Antipolo is that a land
registration court, the RTC at present, has no jurisdiction over
the subject matter of the application which respondent
Republic claims is public land. This ruling needs elucidation.
Firmly entrenched is the principle that jurisdiction over
the subject matter is conferred by law.[39] Consequently, the
proper CFI (now the RTC) under Section 14 of PD
1529[40] (Property Registration Decree) has jurisdiction over
applications for registration of title to land.
Section 14 of PD 1592 provides:
SEC. 14. Who may apply.The following
persons may file in the proper Court of First
Instance an application for registration of
title to land, whether personally or through
their duly authorized representatives:
(1) Those who by themselves or through their
predecessors-in-interest have been in open,
continuous, exclusive and notorious possession
and occupation of alienable and disposable
lands of the public domain under a bona
fide claim of ownership since June 12, 1945, or
earlier. (Emphasis supplied.)
Conformably, the Pasig-Rizal CFI, Branch XXII has jurisdiction
over the subject matter of the land registration case filed by
Fermina Castro, petitioners predecessor-in-interest, since
jurisdiction over the subject matter is determined by the
allegations of the initiatory pleadingthe application.[41] Settled is
the rule that the authority to decide a case and not the
decision rendered therein is what makes up jurisdiction. When
there is jurisdiction, the decision of all questions arising in the
case is but an exercise of jurisdiction.[42]
In our view, it was imprecise to state in Municipality
of Antipolo that the Land Registration Court [has] no
jurisdiction to entertain the application for registration of
public property x x x for such court precisely has the
jurisdiction to entertain land registration applications since that
is conferred by PD 1529. The applicant in a land registration
case usually claims the land subject matter of the application
as his/her private property, as in the case of the application of
Castro. Thus, the conclusion of the CA that the Pasig-Rizal
CFI has no jurisdiction over the subject matter of the
application of Castro has no legal mooring. The land
registration court initially has jurisdiction over the land applied
for at the time of the filing of the application. After trial, the
court, in the exercise of its jurisdiction, can determine whether
the title to the land applied for is registrable and can be
confirmed. In the event that the subject matter of the
application turns out to be inalienable public land, then it has
no jurisdiction to order the registration of the land and perforce
must dismiss the application.
Based on our ruling in Antipolo, the threshold question
is whether the land covered by the titles of petitioners is under
water and forms part of ManilaBay at the time of the land
registration application in 1974. If the land was
within Manila Bay, then res judicata does not apply. Otherwise,
the decision of the land registration court is a bar to the instant
reversion suit.
After a scrutiny of the case records and pleadings of
the parties in LRC Case No. N-8239 and in the instant petition,
we rule that the land of Fermina Castro is registrable and not
part of Manila Bay at the time of the filing of the land
registration application.
The trial courts Decision in 1974 easily reveals the
basis for its conclusion that the subject matter was a dry land,
thus:
On February 1, 1974, the applicant
presented her evidence before the Deputy Clerk
of this Court and among the evidence
presented by her were certain documents which
were marked as Exhibits D to J, inclusive. The
applicant testified in her behalf and substantially
declared that: she was 62 years old, single,
housekeeper and residing at 1550 J. Escoda,
Ermita, Manila; that she was born on June 3,
1911; that she first came to know of the land
applied for which is situated in the Municipality
of Paraaque, province of Rizal, with an area of
17,343 square meters and covered by plan
(LRC) Psu-964 while she was still ten (10)
years old or sometime in 1921; that when she
first came to know of the land applied for, the
person who was in possession and owner of
said land was her father, Catalino Castro; that
during that time her father used to plant on said
land various crops like pechay, mustard,
eggplant, etc.; that during that time, her father
built a house on said land which was used by
her father and the other members of the family,
including the applicant, as their residential
house; that the land applied for was inherited by
her father from her grandfather Sergio Castro;
that Catalino Castro continuously possessed
and owned the land in question from 1921 up to
the time of his death in 1952; and that during
that period of time nobody ever disturbed the
possession and ownership of her father over
the said parcel of land; that after the death of
her father in 1952 she left the place and
transferred her place of residence but she had
also occasions to visit said land twice or thrice a
week and sometimes once a week; that after
she left the land in question in 1952, she still
continued possessing said land, through her
caretaker Eliseo Salonga; that her possession
over the land in question from the time she
inherited it up to the time of the filing of the
application has been continuous, public,
adverse against the whole world and in the
concept of an owner; that it was never
encumbered, mortgaged, or disposed of by her
father during his lifetime and neither did she
ever encumber or sell the same; that it was
declared for taxation purposes by her father
when he was still alive and her father also paid
the real estate taxes due to the government
although the receipt evidencing the payment of
said real estate taxes for the property applied
for have been lost and could no longer be found
inspite of diligent effort exerted to locate the
same.
The other witness presented by the
applicant was Emiliano de Leon, who declared
that he was 70 years old, married, farmer and
residing at San Jose, Baliwag, Bulacan; that he
knew Catalino Castro, the father of the
applicant because said Catalino Castro was his
neighbor in Tambo, Paraaque, Rizal, he had a
house erected on the land of Catalino Castro;
that he was born in 1903 and he first came to
know of the land in question when in 1918 when
he was about 18 years old; that the area of the
land owned and possessed by Catalino Castro
where he constructed a residential house has
an area of more than one and one-half (1 )
hectares; that the possession of Catalino Castro
over the land in question was peaceful,
continuous, notorious, adverse against the
whole world and in the concept of an owner;
that during the time that Catalino Castro was in
possession of the land applied for he planted on
said parcel of land mango, coconut and
banana, etc.; that Catalino Castro continuously
possessed and owned said parcel of land up to
the year 1952 when he died; that during the
time that Catalino Castro was in possession of
said land, nobody ever laid claim over the said
property; that said land is not within any military
or naval reservation; that upon the death of
Catalino Castro, the applicant took possession
of the land applied for and that up to the present
the applicant is in possession of said land; that
he resided in the land in question from 1918 up
to the time he transferred his place of residence
in Baliwag, Bulacan in the year 1958.
On February 11, 1974, the Court,
pursuant to the provision of Presidential Decree
No. 230 issued by his Excellency, Ferdinand E.
Marcos dated July 9, 1973 held in abeyance the
rendition of a decision in this case and directed
the applicant to submit a white print copy of
plan (LRC) Psu-964 to the Director of lands who
was directed by the Court to submit his
comment and recommendation thereon.
The property in question is declared for
taxation purposes under Tax Declaration No.
51842 (Exhibit G) and real estate taxes due
thereon have been paid up to the year 1973
(Exhibit H).
In compliance with the Order of this Court
February 11, 1974, the Director of Lands,
thru Special Attorney Saturnino A. Pacubas,
submitted a report to this Court dated April
25, 1974, stating among other things, that
upon ocular inspection conducted by Land
Inspector Adelino G. Gorospe and the
subsequent joint ocular inspection
conducted by Geodetic Engineer Manuel A.
Cervantes and Administrative Assistant
Lazaro G. Berania, it was established that
the parcel of land covered by plan (LRC)
Psu-964 no longer forms part of the Manila
Bay but is definitely solid and dry land.
In this connection, it should be noted
that Administrative Assistant Lazaro G. Berania
and Geodetic Engineer Manuel A. Cervantes, in
their report dated March 22, 1974 have also
stated that the land applied for cannot be
reached by water even in the highest tide
and that the said land is occupied by
squatter families who have erected
makeshift shanties and a basketball court
which only prove that the same is dry and
solid land away from the shores of Manila
Bay.
Furthermore, Land Inspector Adelino G.
Gorospe in his letter-report dated November 28,
1973 has also stated that there is a house of
pre-war vintage owned by the applicant on the
land in question which in effect corroborates the
testimony of the applicant and her witness that
they have lived on the land in question even
prior to the outbreak of the second world war
and that the applicant has been in possession
of the land in question long time ago.[43]
To counter the evidence of applicant Castro, and
bolster its claim that she has no valid title, respondent
Republic relies on the July 18, 1973 Office Memorandum[44] of
Roman Mataverde, OIC, Surveys Division, to the OIC, Legal
Division, of the Bureau of Lands, stating that when projected
on cadastral maps CM 14 13N - 120 59 E., Sec. 3-D and CM
14 30N - 120 59E., Sec. 2-A of Paranaque [sic] Cadastre
(Cad-299), (LRC) Psu-964 falls inside Manila Bay, outside
Cad-299.[45]
The same conclusion was adopted in a November 15,
1973 letter of Narciso Villapando, Acting Regional Lands
Director to the Chief, Legal Division, Bureau of Lands and in
the Comment and Recommendation of Ernesto C. Mendiola,
Assistant Director, also of the Bureau of Lands.
Respondent likewise cites Namria Hydrographic Map
No. 4243 Revised 80-11-2 to support its position that Castros
lot is a portion of Manila Bay.
The burden of proving these averments falls to the
shoulders of respondent Republic. The difficulty is locating the
witnesses of the government. Roman Mataverde, then OIC of
the Surveys Division retired from the government service in
1982. He should by this time be in his 90s. Moreover, Asst.
Regional Director Narciso Villapando and Asst. Director
Ernesto C. Mendiola are no longer connected with the Bureau
of Lands since 1986.
 Assuming that OIC Roman Mataverde, Asst. Regional
Director Narciso Villapando and Assistant Director Ernesto C.
Mendiola are still available as witnesses, the projections made
on the cadastral maps of the then Bureau of Lands cannot
prevail over the results of the two ocular inspections by several
Bureau of Lands officials that the disputed lot is definitely dry
and solid land and not part of Manila Bay. Special Attorney
Saturnino A. Pacubas, Land Inspector Adelino G. Gorospe,
Geodetic Engineer Manuel A. Cervantes and Administrative
Asst. Lazaro A. Berana, all officials of the Bureau of Lands,
were positive that the disputed land is solid and dry land and
no longer forms part of Manila Bay. Evidence gathered from
the ocular inspection is considered direct and firsthand
information entitled to great weight and credit while the
Mataverde and Villapando reports are evidence weak in
probative value, being merely based on theoretical projections
in the cadastral map or table surveys.[46] Said projections must
be confirmed by the actual inspection and verification survey
by the land inspectors and geodetic engineers of the Bureau of
Lands. Unfortunately for respondent Republic, the bureau land
inspectors attested and affirmed that the disputed land is
already dry land and not within Manila Bay.
On the other hand, the Namria Hydrographic Map No.
4243 does not reveal what portion of Manila Bay was Castros
lot located in 1974. Moreover, a hydrographic map is not the
best evidence to show the nature and location of the lot
subject of a land registration application. It is derived from a
hydrographic survey which is mainly used for navigation
purposes, thus:
Surveys whose principal purpose is the
determination of data relating to bodies of
water. A hydrographic survey may consist of the
determination of one or several of the following
classes of data: depth water; configuration and
nature of the bottom; directions and force of
currents; heights and times of tides and water
stages; and location of fixed objects for survey
and navigation purposes.[47]
Juxtaposed with finding of the ocular inspection by
Bureau of Lands Special Attorney Pacubas and others that
Castros lot is dry land in 1974, Namria Hydrographic Map No.
4243 is therefore inferior evidence and lacking in probative
force.
Moreover, the reliability and veracity of the July 18,
1973 report of Roman Mataverde based on the alleged
projection on cadastral maps and the Villapando report dated
November 15, 1973 are put to serious doubt in the face of the
opinion dated October 13, 1997 of the Government Corporate
Counsel, the lawyer of the PEA, which upheld the validity of
the titles of petitioners, thus:
We maintain to agree with the findings
of the court that the property of Fermina Castro
was registrable land, as based on the two (2)
ocular inspections conducted on March 22,
1974 by Lands Administrative Assistant Lazaro
G. Berania and Lands Geodetic Engr. Manuel
Cervantes, finding the same no longer forms
part of Manila Bay but is definitely solid land
which cannot be reached by water even in the
highest of tides. This Berania-Cervantes
report based on ocular inspections literally
overturned the findings and
recommendations of Land Director Narciso
V. Villapando dated November 15, 1973, and
that of Director Ernesto C. Mendiola dated
December 1, 1977, and the fact that the
Villapando-Mendiola reports were merely
based on projections in the cadastral map or
table surveys.
xxxx
A. The Legal prognosis of the case is not
promising in favor of PEA.
4.1 LRC Case No. N-8239 has already
become final and executory and OCT No.
10215 was already issued in favor of Fermina
Castro. Any and all attempts to question its
validity can only be entertained in a quo
warranto proceedings (sic), assuming that there
are legal grounds (not factual grounds) to
support its nullification. Subjecting it to a
collateral attack is not allowed under the
Torrens Title System. In Calalang vs. Register
of Deeds of Quezon City, 208 SCRA 215, the
Supreme Court held that the present petition is
not the proper remedy in challenging the validity
of certificates of titles since the judicial action
required is a direct and not a collateral attack
(refer also to: Toyota Motor Philippine
Corporation vs. CA, 216 SCRA 236).
4.2 OCT No. 10215 in favor of Fermina
Castro was issued pursuant to a cadastral
proceeding, hence is a rem proceedings which
is translated as a constructive notice to the
whole world, as held in Adez Realty
Incorporated vs. CA, 212 SCRA 623.
4.3 From the cursory and intent reading
of the decision of Judge Sison in LRC Case No.
N-8239, we cannot find any iota of fraud having
been committed by the court and the parties. In
fact, due process was observed when the Office
of the Solicitor General represented ably the
Bureau of Lands. In Balangcad vs. Justices of
the Court of Appeals, 206 SCRA 169, the
Supreme Court held that title to registered
property becomes indefeasible after one-year
from date of registration except where there is
actual fraud in which case it may be challenged
in a direct proceeding within that period. This is
also the ruling in Bishop vs. CA, 208 SCRA
636, that to sustain an action for annulment of a
torrens certificate for being void ab initio, it must
be shown that the registration court had not
acquired jurisdiction over the case and there
was actual fraud in securing the title.
4.4 As to priority of torrens title, PEA has
no defense, assuming that both PEA and
Yujuico titles are valid, as held in Metropolitan
 Waterworks and Sewerage System vs. CA, 215
SCRA 783, where two (2) certificates purport to
include the same land, the earlier in date
prevails.
4.5 The documents so far submitted
by the parties to the court indicate that the
mother title of the Yujuico land when
registered in 1974 was not underwater. This
was shown in the two (2) ocular inspections
conducted by the officials of the Land
Bureau.
4.6 The provision of P.D. 239 that no
decree of registration may be issued by the
court unless upon approval and
recommendation of the Bureau of Lands was
substantially complied with in the Report of
Lands Special Attorney Saturnino Pacubas,
submitted to the court.[48]
Even the counsel of respondent Republic, the OSG,
arrived at the conclusion that there is no sufficient legal basis
for said respondent to institute action to annul the titles of
petitioners, thus:
It may be stated at the outset that a
petition for annulment of certificate of title or
reconveyance of land may be based on fraud
which attended the issuance of the decree of
registration and the corresponding certificate of
title.
Based on the decision in the LRC Case
No. N-8239 involving the petition for registration
and confirmation of title filed by Fermina Castro,
there is no showing that fraud attended the
issuance of OCT No. 10215. it appears that the
evidence presented by Fermina Castro was
sufficient for the trial court to grant her petition.
The testimony of Fermina Castro, which
was corroborated by Emiliano de Leon, that she
and her predecessors-in-interest had been in
possession of the land for more than thirty (30)
years sufficiently established her vested right
over the property initially covered by OCT No.
10215. The report dated April 25, 1974 which
was submitted to the trial court by the Director
of Lands through Special Attorney Saturnino
Pacubas showed that the parcel of land was
solid and dry land when Fermina Castros
application for registration of title was filed. It
was based on the ocular inspection conducted
by Land Inspector Adelino Gorospe and the
joint circular inspection conducted by Geodetic
Engineer Manuel A. Cervantes and
Administrative Assistant Lazaro Berania
on November 28, 1973 and March 22,
1974 respectively.
 The aforesaid report must be requested
unless there is a concrete proof that there was
an irregularity in the issuance thereof. In the
absence of evidence to the contrary, the ocular
inspection of the parcel of land, which was
made the basis of said report, is presumed to
be in order.
Based on the available records, there
appears to be no sufficient basis for the
Government to institute an action for the
annulment of OCT No. 10215 and its
derivative titles. It is opined that a petition
for cancellation/annulment of Decree No. N-
150912 and OCT No. 10215 and all its
derivative titles will not prosper unless there
is convincing evidence to negate the report
of the then Land Management Bureau
through Special Attorney Pacubas. Should
the Government pursue the filing of such an
action, the possibility of winning the case is
remote.[49]
More so, respondent Government, through its counsel,
admits that the land applied by Fermina Castro in 1973 was
solid and dry land, negating the nebulous allegation that said
land is underwater. The only conclusion that can be derived
from the admissions of the Solicitor General and Government
Corporate Counsel is that the land subject of the titles of
petitioners is alienable land beyond the reach of the reversion
suit of the state.
Notably, the land in question has been the subject of a
compromise agreement upheld by this Court in Public Estates
Authority.[50] In that compromise agreement, among other
provisions, it was held that the property covered by TCT Nos.
446386 and S-29361, the land subject of the instant case,
would be exchanged for PEA property. The fact that PEA
signed the May 15, 1998 Compromise Agreement is already a
clear admission that it recognized petitioners as true and legal
owners of the land subject of this controversy.
Moreover, PEA has waived its right to contest the
legality and validity of Castros title. Such waiver is clearly
within the powers of PEA since it was created by PD 1084 as
a body corporate which shall have the attribute of perpetual
succession and possessed of the powers of the corporations,
to be exercised in conformity with the provisions of this Charter
[PD 1084].[51] It has the power to enter into, make, perform and
carry out contracts of every class and description, including
loan agreements, mortgages and other types of security
arrangements, necessary or incidental to the realization of its
purposes with any person, firm or corporation, private or
public, and with any foreign government or entity.[52] It also has
the power to sue and be sued in its corporate name.[53]Thus,
the Compromise Agreement and the Deed of Exchange of
Real Property signed by PEA with the petitioners are legal,
valid and binding on PEA. In the Compromise Agreement, it is
provided that it settles in full all the claims/counterclaims of the
parties against each other.[54] The waiver by PEA of its right to
question petitioners title is fortified by the manifestation by
PEA in the Joint Motion for Judgment based on Compromise
Agreement that
4. The parties herein hereto waive and
abandon any and all other claims and
 counterclaims which they may have against
each other arising from this case or related
thereto.[55]
Thus, there was a valid waiver of the right of
respondent Republic through PEA to challenge petitioners
titles.
The recognition of petitioners legal ownership of the
land is further bolstered by the categorical and unequivocal
acknowledgment made by PEA in its September 30, 2003
letter where it stated that: Your ownership thereof was
acknowledged by PEA when it did not object to your
membership in the CBP-IA Association, in which an owner of a
piece of land in CBP-IA automatically becomes a member
thereof.[56] Section 26, Rule 130 provides that the act,
declaration or omission of a party as to a relevant fact may be
given in evidence against him. The admissions of PEA which
is the real party-in-interest in this case on the nature of
the land of Fermina Castro are valid and binding on
respondent Republic. Respondents claim that the disputed
land is underwater falls flat in the face of the admissions of
PEA against its interests. Hence, res judicata now effectively
precludes the relitigation of the issue of registrability of
petitioners lot.
In sum, the Court finds that the reversion case should
be dismissed for lack of jurisdiction on the part of the
Paraaque RTC. Even if we treat said case as a petition for
annulment of judgment under Rule 47 of the 1997 Rules of
Civil Procedure, the dismissal of the case nevertheless has to
be upheld because it is already barred by laches. Even if
laches is disregarded, still the suit is already precluded by res
judicata in view of the peculiar facts and circumstances
obtaining therein.
WHEREFORE, premises considered, the petition
is GRANTED. The Decision of the Court of Appeals in CA-
G.R. CV No. 76212 is REVERSED andSET ASIDE, and
the August 7, 2002 Order of the Paraaque City RTC, Branch
257 in Civil Case No. 01-0222 entitled Republic of
the Philippines v. Fermina Castro, et al. dismissing the
complaint is AFFIRMED.
G.R. No. L-36507 June 14, 1974
ANTONIO PIÑERO, JR., EMMA BERNAD (assisted by her
husband Norberto Bernad) and FORTUNATO
PIÑERO, petitioners-appellees,
vs.
THE DIRECTOR OF LANDS, SEGUNDO M. REYES, in his
capacity as the Provincial Land Officer of Zamboanga del
Norte, MARIANO D. PALERMO, in his capacity as Deputy
Public Lands Inspector, NICANOR ALASAAS, EUSEBIO
CAMANSI and TOMAS SUMALPONG, respondents. THE
DIRECTOR OF LANDS, SEGUNDO M. REYES, in his
capacity as the Provincial Land Officer of Zamboanga del
Norte and MARIANO D. PALERMO, in his capacity as
Deputy Public Lands Inspector, respondents-appellants.
Porferio E. Mah for petitioners-appellees.
Officer of the Solicitor General Arturo A. Alafriz, Assistant
Solicitor General Pacifico P. de Castro and Solicitor Francisco
J. Bautista for respondents-appellants.
BARREDO, J.:p
Appeal by the Solicitor General from the decision of the Court
of First Instance of Zamboanga del Norte in its Civil Case No.
1128, granting the writ of prohibition prayed for by appellees
against the appellant Director of Lands, the Provincial Land
Officer of the same province and other subordinate officials
who, by order of said director, had initiated an investigation of
alleged fraud claimed to have led to the issuance of the Free
Patents and corresponding Certificates of Title to the said
appellees.
This appeal was certified to Us by the Court of Appeals on
February 20, 1973, the decision of the trial court being based
exclusively on a stipulation of facts as follows:
1. That Antonio Piñero, Jr., and Emma Piñero
Bernad are residents of Dipolog, Zamboanga
del Norte; while Fortunate Piñero is presently a
resident of Negros Oriental;
2. That the identities of Lots Nos. 5790, 5792
and 2532, all of Pls- 100, situated at Napuyan,
Dapitan, Zamboanga del Norte, are submitted
(sic); .
3. That Lot No. 5790, Pls - 100 is covered by
Free Patent No. V-63411 issued January 30,
1957 in favor of Antonio Piñero, Jr., and Lot No.
5792 Pls - 100 is covered by Free Patent No. V-
63420 issued on January 30, 1957 in favor of
Emma Piñero Bernad, and that Lot 2532 is
applied for by Fortunato Piñero under
Homestead Application No. V-66441 approved
as of January 2, 1953, but up to the present no
Patent has as yet been issued; .
4. That Lot 2532 was formerly part of PSU -
111118, a private survey executed by Surveyor
Calixto Sudiacal in 1939 for Fortunato Piñero
and that by subsequent survey executed by the
ECA, Psu-111118 was subdivided into smaller
lots, one of which is now Lot 2532; .
5. That pursuant to Free Patent No. V-63411,
Original Certificate of Title No. D-5349 was
issued by the Register of Deeds of Zamboanga
del Norte in favor of Antonio Piñero, Jr., on
October 17, 1957; .
6. That pursuant to Free Patent No. V-63420,
Original Certificate of Title No. P-5312 was
issued by Register of Deeds of Zamboanga del
Norte, in favor of Emma Piñero on October 17,
1957; .
7. That on August 8, 1958, the Director of
Lands issued an order directing the
investigation of the protest of Eusebio Camansi,
against the patented application of Antonio
Piñero Jr., a copy of said order being found on
page 14 of the expediente; and that on March
24, 1959 the Director of Lands thru the Chief
Legal Division directed the Provincial Land
Officer at Dipolog, to investigate the protest of
Nicanor Alasaas against the patented
application of Emma Piñero Bernad, a copy of
said order is also being on page 15 of the
expediente;
8. That as regards Lot 5790 Pls - 100 the
protest of Eusebio Camansi has been given due
course against the claim of Antonio Piñero Jr.,
which protest has been investigated and
terminated, Antonio Piñero Jr., being
represented by his counsel Atty. Jesus
Sarmiento;
9. That Nicanor Alasaas filed his protest dated
February 27, 1958 and subscribed on March
11, 1958, before Notary Public, G.R. Dalmacio,
Jr., a copy is hereto attached as Exhibit A; and
that the protest of Nicanor Alasaas has been
investigated by Atty. Mariano D. Palermo,
investigator of the Bureau of Lands, Dipolog,
Zamboanga del Norte on August 30, 1959;
10. That with respect to Lot 5792 the same has
already been investigated and regarding Lot
5790 the investigation has already been
terminated but no decision has as yet been
issued;
11. That with respect to the claim of Tomas
Sumalpong against the application of Fortunato
Piñero an investigation was conducted on
August 21, 1959 but neither Fortunato Piñero
nor counsel appeared; that when the said case
was rescheduled for October 30, 1959, Atty.
Jaime T. Hamoy counsel for Fortunato Piñero
filed a motion for postponement on the ground
that said counsel had a Criminal Case to attend
to in the Justice of the Peace Court of
Manukan, Zamboanga del Norte, after which
the hearing was rescheduled for December 28,
1959; that in said hearing counsel for Fortunato
Piñero for the first time attacked the authority of
the investigation on the alleged ground that
under the Revised Administrative Code only the
Director of Lands and Chief of Section of said
Office can order investigation of land conflicts;
that up to the present no resolution of that issue
has as yet been made; and that no written
motion bearing on the same ground interposed
before the investigator was ever raised before
the Director of Lands;
12. That pursuant to a letter of Atty. Candido
Pa. Sumalpong as counsel for Tomas
Sumalpong under date of July 28, 1959,
protesting against the above-mentioned
homestead application of Fortunato Piñero
which letter was addressed to the Director of
Lands thru the Provincial Land Officer at
Dipolog, Zamboanga del Norte, the said
Provincial Land Officer in the first indorsement
dated July 22, 1959 addressed to Deputy Public
Lands Inspector, Mariano D. Palermo, directed
the investigation of the case until the said case
is terminated for disposition under the provision
of Land Administrative Order No. 13-3 that the
said first indorsement was the sole authority for
the investigation of the claim of said Tomas
Sumalpong against the homestead application
of Fortunato Piñero that as above stated the
investigation of the claim of Tomas Sumalpong
was not terminated because counsel for
Fortunato Piñero attacked the authority for the
said investigation;
13. That in connection with the separate petition
of the respondents, Nicanor Alasaas, Eusebio
Camansi and Tomas Sumalpong against the
application of the petitioners the same
respondents were required by the Chief of the
Legal Division of the Bureau of Lands in a letter
dated September 4, 1959 to file a sworn protest
and pay the protest fee within a period of thirty
days from the receipt of the said letter,
otherwise the respondents claim will be
dismissed and disregarded without further
notice; that a copy of said letter is hereto
attached as an integral part of this stipulation of
facts as Exhibit "B"; that there is no showing
that respondents complied with the said letter
nor is there any showing that the claim of the
respondents are already dismissed (that is as of
this date); that on December 18, 1959 the
petitioners, thru counsel, filed a motion to
dismiss the alleged protest but up to the present
no resolution on has ever been made; that as
shown by this letter of September 4, 1959 which
was addressed to Antonio Mabulay, Annex "B"
respondents Tomas Sumalpong, Nicanor
Alasaas and Eusebio Camansi were not given
copy of this letter, and that the motion of
counsel for the "Dismiss the Protest" (sic) does
not show that respondents Tomas Sumalpong,
Eusebio Camansi and Nicanor Alasaas were
ever furnished a copy of said motion;
14. That the Director of Lands was actually
served with summons on January 20, 1960 as
shown by the return of the City Sheriff of
Manila, which return appears on page 25 of the
record of this case;
15. That for all matters not covered by this
stipulation of facts parties agree to ask for a
date for the reception of evidence.
We hold the appeal to be meritorious. In the light of the facts
disclosed in the foregoing stipulation, We reiterate Cebedo vs.
Director of Lands, G.R. No. L-12777, May 22, 1961, 2 SCRA
25, wherein We held that it is not only the right but the duty of
the Director of Lands to conduct the investigation of any
alleged fraud in securing a free patent and the corresponding
title to a public land and to file the corresponding court action
for the reversion of the same to the State, if the facts disclosed
in the course of such investigation should so warrant.
Consequently, prohibition cannot be issued to enjoin such an
investigation despite the existence of a Torrens title.
Indeed, it is to be clarified that Section 91 of the Public Land
Act leaves no other alternative to the Director of Lands. The
provision reads thus:
SEC. 91. The statements made in the
application shall be considered as essential
conditions and parts of any concession, title, or
permit issued on the basis of such application,
and any false statement therein or omission of
facts altering, changing, or modifying the
consideration of the facts set forth in such
statements, and any subsequent modification,
alteration, or change of the material facts set
forth in the application shall ipso facto produce
the cancellation of the concession, title, or
permit granted. It shall be the duty of the
Director of Lands, from time to time and
whenever he may deem it advisable, to make
the necessary investigations for the purpose of
ascertaining whether the material facts set out
in the application are true, or whether they
continue to exist and are maintained and
preserved in good faith, and for the purpose of
such investigation, the Director of Lands is
hereby empowered to issue subpoenas and
subpoenas duces tecum and, if necessary, to
obtain compulsory process from the courts. In
every investigation made in accordance with
this section, the existence of bad faith, fraud,
concealment, or fraudulent and illegal
modification of essential facts shall be
presumed if the grantee or possessor of the
land shall refuse or fail to obey a subpoenas or
subpoenas duces tecum lawfully issued by the
Director of Lands or his authorized delegates or
agents, or shall refuse or fail to give direct and
specific answers to pertinent questions, and on
the basis of such presumption, an order of
cancellation may issue without further
proceedings.
Underlying this section and providing its justification is the
Regalian doctrine embodied in Section 1 of Article XIII of the
Constitution of 1935, in force during the material dates of the
events herein involved, declaring that "all agricultural, timber,
and mineral lands of the public domain . . and other natural
resources of the Philippines belong to the State...." And
under Krivenko vs. Register of Deeds, 79 Phil. 461, "the scope
of this constitutional provision, according to its heading and its
language, embraces all lands of any kind of the public domain,
its purpose being to establish a permanent and fundamental
policy for the conservation and utilization of all natural
resources of the Nation." Accordingly, the right to acquire
disposable lands from the State through any of the means
provided for in the Public Land Act, Commonwealth Act 141,
must necessarily be subject to the reservation expressly made
in above quoted Section 91 to the effect that "the statements
made in the application shall be considered as essential
conditions and parts of any ... title ... issued on the basis of
such application" and that "any false statement therein or
omission of facts altering, changing or modifying the
consideration of the facts set forth in such statements, and any
subsequent modification, alteration or change of the material
facts set forth in the application shall ipso facto1produce the
cancellation of the concession, title or permit granted."
It is true that under Section 122 of the Land Registration Act, a IN VIEW OF THE FOREGOING, the decision of the trial court
Torrens title issued on the basis of a free patent or a is reversed and the writ of prohibition sought by appellees is
homestead patent is as indefeasible as one judicially secured. denied. Costs against appellees.
And in repeated previous decisions of this Court that
indefeasibility has been emphasized by Our holding that not Makalintal, C.J., Zaldivar, Castro, Fernando, Teehankee,
even the Government can file an action for annulment, but at Makasiar, Antonio, Esguerra, Fernandez, Muñoz Palma and
the same time, it has been made clear that an action for Aquino, JJ., concur.
reversion may be instituted by the Solicitor General, in the
name of the Republic of the Philippines.2 It is to the public
interest that one who succeeds in fraudulently acquiring title to
a public land should not be allowed to benefit therefrom, and
the State should, therefore, have an ever existing authority,
thru its duly authorized officers, to inquire into the
circumstances surrounding the issuance of any such title, to
the end that the Republic, thru the Solicitor General or any
other officer who may be authorized by law, may file the
corresponding action for the reversion of the land involved to
the public domain, subject thereafter to disposal to other
qualified persons in accordance with law. In other words, the
indefeasibility of a title over land previously public is not a bar
to an investigation by the Director of Lands as to how such title
has been acquired, if the purpose of such investigation is to
determine whether or not fraud had been committed in
securing such title in order that the appropriate action for
reversion may be filed by the Government.

Nothing said above, however, should be understood as

holding that the Court has found that the titles of appellees
have been in fact fraudulently secured. That matter may be
resolved only after the Director of Lands shall have finished his
investigation.