Professional Documents
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Land Titles Cases For Finals
Land Titles Cases For Finals
G.R. No. 76265 April 22, 1992 On July 25, 1984, the Court rendered a decision in affirming the decision of the Court of
Appeals. The validity of the sale of Lucia to the INK was thereby upheld and the title of INK
VIRGINIA CALALANG, petitioner, to the subject realty (Lot 671) was validated as well.
vs.
REGISTER OF DEEDS OF QUEZON CITY, ADMINISTRATOR OF NATIONAL LAND This Supreme Court decision spawned the two (2) petitions now before us assailing the
TITLES AND DEEDS REGISTRATION ADMINISTRATION, LUCIA DE LA CRUZ, validity of Lucia dela Cruz's title over Lot 671 which in turn was sold to INK.
CONSTANCIO SIMANGAN and IGLESIA NI KRISTO, respondents.
In G.R. No. 76265, petitioner Virginia Calalang alleged that she is the registered owner of
G.R. No. 83280 April 22, 1992 a portion of Lot 671-A (subdivision plan PSD 32221) as evidenced by TCT Nos. 17556,
17564 and 17562. She allegedly came to know of INK'S claim only when a prospective
AUGUSTO M. DE LEON, JOSE M. DE CASTRO, JOSE A. PANLILEO, FELICIDAD buyer inspected the land on August 1986 and saw the "no trespassing" sign.
VERGARA VDA. DE PINEDA, FERNANDO L. VITUG I, FERNANDO M. VITUG II,
FERNANDO M. VITUG III, FAUSTINO TOBIA, ELENA M. OSTREA and FELISA C. Petitioner Calalang lost no time in inquiring into the status of the land and learned about
CRISTOBAL-GENEROSO, petitioners, the pending consulta case (LRC 1978) filed before the Administrator of the National Land
vs. Titles and Deeds Registration Administration (NLTDRA). This consulta came about when
THE HON. COURT OF APPEALS and BISHOP ERAO MANALO, respondents. the Register of Deeds doubted the registrability of the documents presented before it in the
light of his findings that the land affected was covered by two (2) sets of titles issued in the
names of different owners.
GUTIERREZ, JR., J.:
Lot 671-A is actually part of a bigger parcel known as Lot 671 which is claimed by Hence, on October 27, 1986, the petitioner file the instant Special Civil Action
respondent Iglesia ni Kristo (INK), which bought said property from Lucia dela Cruz in for Certiorari and Prohibition in G.R. No. 76265 against the Administrator of the NLTDRA,
1975. Dela Cruz was adjudged the rightful owner of Lot 671 in the case of dela Cruz the Register of Deeds of Quezon City and private respondents Lucia dela Cruz,
v. dela Cruz (130 SCRA 666 [1984]). INK began fencing the whole area and placed the Constancio Simangan and Iglesia ni Kristo. Lucia dela Cruz and Constancio Simangan
following sign "NO TRESPASSING IGLESIA NI KRISTO PROPERTY SUPREME were impleaded as they were predecessors-in-interest of INK.
COURT CASE NO. 61969, July 25, 1984."
INK and the Administrator filed their comments on January 5, 1987 and June 29, 1987
Briefly, the dela Cruz v. dela Cruz case is an action for reconveyance founded on breach respectively. For failure to locate Constancio Simangan's whereabouts despite diligent
of trust filed by Augustina dela Cruz, et al. against Lucia dela Cruz and INK. Augustina and efforts and considering further that INK is the indispensable party and the one interested in
her co-plaintiffs charged that the parcel of land purchased by the INK from Lucia dela Cruz upholding the validity of the reconstituted title of respondent Lucia dela Cruz, the petitioner
was actually a part of their inheritance share in the estate of their late grandfather, moved to drop him as respondent. This was granted by the Court in a resolution dated
Policarpio dela Cruz but which, in breach of trust known to the INK, Lucia sold to the latter. April 13, 1988. (Rollo, p. 189)
Augustina's suit was originally decided in her favor by the trial court. On appeal to the Taking the cue from the Administrator that present certificates of title must be cancelled to
Court of Appeals, the judgment was reversed and the questioned sale by Lucia dela Cruz avoid duplication, the Register of Deeds, instead of filing its comment initiated cancellation
to the INK was upheld. Consequently, Augustina went to the Supreme Court on a petition proceedings of more than 100 titles, against 81 defendants which included herein
for review on certiorari, docketed as G. R. No. 61969. petitioner on the basis of this Court's declaration in the case of dela Cruz that the
reconstituted title of respondent Lucia dela Cruz is the valid title. This petition was filed by
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
the Office of the Solicitor-General (OSG) on January 5, 1987 with the Regional Trial Court 2ND DIVISION
of Quezon City docketed as Civil Case No. Q-49900. G. R. NO. L 61969
JULY 25, 1984
Consequently, the petitioner moved to dismiss on the ground that the complaint was
premature and maliciously filed with knowledge of the instant petition with this Court. INK, INK also destroyed the concrete/hollow block fence surrounding the lot of petitioner de
on the other hand, filed a Motion to Intervene in said case. Claiming ownership over Lot Castro and started the construction of housing structures therein. At the same time, it
671, it prayed for damages against some of the defendants namely Augusto de Leon, Jose commenced the delivery of construction materials to the former premises of petitioner
M. Panlilio and Felicidad Vda. de Pineda who filed an injunction suit against it (Civil Case Panlilio to erect a permanent structures of strong materials on it.
No. Q-45767) with the Regional Trial Court (RTC) of Quezon City on September 12, 1985.
Thus, on August 22, 1985, the petitioners filed with the RTC-Branch 101 a petition for
Despite opposition of the petitioner to respondent INK's Motion to Intervene, presiding injunction with damages. This case was docketed an Civil Case No. 45767. Later, this
Judge Benigno T. Dayaw granted the motion of INK and denied petitioner's Motion to petition was amended to include Elena Ostrea and Feliza C. Cristobal-Generoso as
Dismiss on the ground that the issues raised in the instant petition (G. R. No. 76265) will additional petitioners.
not substantially affect said civil case. The subsequent motion for reconsideration filed by
the petitioner was likewise denied considering that no restraining order has been issued August 25, 1985, presiding Judge Santiago issued a restraining order and set the case for
(Rollo, pp. 198-216). hearing the writ for preliminary injunction on September 5, 1985.
However, instead of filing an answer to the complaint in Civil Case No. Q-49900, the
The September 5 hearing was however, reset to September 19, 1985 with respondent
petitioners filed on July 15, 1988 a supplemental petition before this Court to include as Erao Manalo volunteering to maintain the status quo until then or until the matter had
additional respondent, the Honorable Judge Benigno T. Dayaw and petitioner's children been resolved by the trial court.
who were named as defendants in said Civil Case, as additional petitioners. At the same
time the petitioner prayed for a restraining order (Rollo, p.197).
On September 19, by agreement of the parties and in open court, the Judge issued an
order, granting the parties' motion to enter into a stipulation of facts instead of going on
To this supplemental petition, the OSG in behalf of the Republic filed its comment pursuant with the hearing and to maintain the status quo.
to the Court's resolution granting the petitioner's motion for leave to include additional
parties and to admit supplemental petition (Rollo, p. 228).
In the course of the exchange of pleadings between the parties, the trial judge issued an
Order on December 6, 1985 denying the petitioners' prayer for the issuance of a writ of
In the meantime, fire gutted the records of the Register of Deeds in Quezon City, so preliminary injunction on the grounds that:
respondent Judge required the parties to agree to a stipulation of facts instead of trial.
On April 9, 1986, the Court of Appeals promulgated a Decision with the following Although other minor issues are involved in these consolidated cases, the principal and
dispositive portion: crucial issue that alone needs to be resolved is the applicability of this Court's decision in
the dela Cruz case to these cases now before us.
WHEREFORE, the petition is given due course and is hereby
RESOLVED by setting aside the Order dated December 6, 1985 in Civil The petitioners argue that the dela Cruz case could not be applied to them since they were
Case No. Q-45767 and directing that the application for preliminary not parties in that case nor were they ever notified of such case pending between the
injunctive relief therein be properly heard and evidence for or against parties. The petitioners explained that the de la Cruz case was a case among the heirs of
the same be adduced in due course. (Rollo, p. 39) Policarpio de la Cruz. Since they acquired their properties from an entirely different person,
Amando Clemente and not from any of the heirs of Policarpio de la Cruz, they could not be
On February 12, 1987, respondent INK filed with the lower court a motion to dismiss the considered privies to any of them.
petitioners' complaint for injunction on the ground that it does not state a cause of action.
In denying applicability, however, the petitioners assail the Court's ruling that "the
On August 7, 1987, the lower court issued an Order with the following dispositive portion: reconstituted title of Lucia dela Cruz over Lot 671 (TCT No. RT 58) was valid. As the
registered and rightful owner, Lucia dela Cruz had the perfect and legal right to sell,
assign, and convert the property to respondent INK who as purchaser for value in good
WHEREFORE, premises considered, finding respondent's Motion to faith holds the same free from all encumbrances except those noted in said certificate."
Dismiss justified, the instant petition is hereby DISMISSED, with costs
against petitioners. (Rollo, p. 48)
With this Court's ruling promulgated in 1984, it is our considered view that the petitioner
can not raise anew the question of ownership of Lucia dela Cruz over Lot 671 which had
Seeking relief from the dismissal, the petitioners filed the two pleadings, to wit: been determined by the Court of Appeals and affirmed by the Supreme Court in the dela
Cruz case. Well-settled is the rule enunciated in Church Assistance Program,
1) "Motion for Reconsideration Ad Cautelam" dated September 18, Inc. v. Sibulo, 171 SCRA 408 [1989] that:
1987 filed with the RTC, NCR, Branch 101 Quezon City; and
When a right or fact has been judicially tried and determined by a court
2) "Omnibus Motion Incident to Execution of the Decision dated April 9, of competent jurisdiction, so long as it remains unreversed, it should be
1986" dated September 29, 1987 filed with the Court of Appeals. conclusive upon the parties and those in privity with them in law or
estate.
On December 10, 1987, the Court of Appeals denied petitioners' Omnibus Motion. The
petitioners' motion for reconsideration was likewise denied in a resolution by the RTC The Court's ruling has long been final and the issue on ownership of Lot 671 finally
dated May 4, 1988. disposed of several years ago. This declaration must be respected and followed in the
instant case applying the principle of res judicata or, otherwise, the rule on conclusiveness
of judgment. The less familiar concept or less terminological usage of res judicata as a rule
Hence, the instant petition with the following assignment of errors. on conclusiveness of judgment refers to the situation where the judgment in the prior
action operates as an estoppel only as to the matters actually determined therein or which
THE HONORABLE COURT OF APPEALS, IN ITS DECEMBER 10, were necessarily included therein (De la Cruz v. Court of Appeals, 187 SCRA 165 [1990]).
1987 RESOLUTION, ERRED IN HOLDING THAT THE ORDERS OF
DECEMBER 12, 1986 AND AUGUST 7, 1986 RELATE TO Inevitably, the dela Cruz ruling should be applied to the present petitions since the facts on
INCIDENTS IN CIVIL CASE NO. 45767 TOTALLY ALIEN TO THE which such decision was predicated continue to be the facts of the case before us now
SUBJECT MATTER OF CA-G.R. SP NO. 08146. (See Rivas v. SEC, 190 SCRA 295 [1990]). Even the petitioners substantially adopt the
same findings of facts in their pleadings. The factual inquiry with regards to the history of
THE HONORABLE COURT OF APPEALS ERRED IN VALIDATING Lot 671 has already been laid to rest and may no longer be disturbed. We quote:
THE ORDER OF AUGUST 7, 1986. (Rollo, p. 16)
The undisputed facts indicate that the parcel of land in question is Lot
In a resolution dated August 30, 1989, G.R. No. 83280 was consolidated with G.R. No. 671 of the Piedad Estate, GLRO Rec. No. 5975, with an area of 184,
76265. 268 square meters, more or less, situated in Barrio Culiat, Quezon
City; that the totality of the Piedad Estate consists of a vast tract of
land, registered on March 12, 1912, in the name of the Philippine
Government, under Original Certificate of Title (OCT) No. 614 of the
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Register of Deeds of the Province of Rizal; that when the Piedad Estate Quezon City Registry, from the latter Registry assigned to this TCT a
was subdivided (with Lot No. 671 as one of the resulting parcels) new number, RT-52; that this same Lot (No. 671) was later subdivided
whoever was in possession of a particular lot was given priority and/or into two lots, each with a title:
preference in the acquisition thereof provided that the price and the
cost of titling would be paid; that upon such payment, the government (a) Lot No. 671-A (TCT No. 16212)
would issue the corresponding certificate of title; that Policarpio dela
Cruz and his wife Luciana Rafael were originally in possession of the
land; that they had three children, namely (b) Lot No. 671-B (TCT No. 16213)
(1) Maximo de la Cruz (married to Feliza Yabut); both in the names of Eugenia de la Paz and Dorotea de la Cruz; that
the second lot (lot No. 671-B, with an area of 103,108 square
meters) was sold on December 17, 1952 to one Narcisa Vda. de
(2) Filomeno de la Cruz (married to Narcisa Santiago); and
Leon (to whom TCT No. 2009 was later issued); that on May 6,
1964, Narcisa Vda. de Leon transferred the same Lot 671-B to Nieves
(3) defendant-appellant Lucia de la Cruz (a widow); Paz Eraa (who was later issued in her own name TCT No. 79971).
that the plaintiffs-appellees herein are the descendants of the two sons The undisputed facts further show that in 1971, Nieves Paz Eraa filed
(Maximo and Filomeno) of Policarpio; that on April 25, 1940, Lot before the Court of First instance of Quezon City Civil Case No. 16125
No. 671 was segregated from the totality of the Piedad Estate, covered for 'quieting of title' against Lucia de la Cruz, et al., praying that TCT
by OCT No. 614 and a separate title was issued in the name of No. RT-58, (the reconstituted title of Lucia de la Cruz), as well as all
titles derived therefrom, be declared null and void; that the case ended
"Eugenia de la Paz, soltera" and "Dorotea de la Cruz, viuda" with the parties submitting a compromise agreement with Lucia de la
Cruz, among other things, paying plaintiff Eraa the amount of
P250,000.00 to cover the acquisitive cost of the 103,108 square meters
(this was Transfer Certificate of Title (TCT) No. 40355 of the Register of of land included in the certificate of title of defendant Lucia de la Cruz;
Deeds for the Province of Rizal); that on November 29, 1941, a deed of that on July 17, 1975, Lucia de la Cruz sold a portion of Lot No. 671-
sale over Lot No. 671 was executed by Eugenia de la Paz and Dorotea C (one of the three portions to which the lot included in RT-58 had been
de la Cruz (the registered owners) in favor of defendant-appellant Lucia subdivided, and which portion was covered by TCT No.
de la Cruz; that said deed of sale was registered with the office of the 168322), consisting of 103,108 square meters to defendant-appellant
Register of Deeds on July 17, 1943 and the corresponding certificate of Iglesia Ni Cristo, for the amount of P2,108,850.00; that this sale was
title was issued to Lucia de la Cruz; that in 1971, Lucia de la Cruz later registered in the Registry of Deeds of Quezon City, with a new
obtained from the land registration court a reconstituted title (TCT No. title, TCT No. 209554 being issued in the name of the Iglesia Ni Cristo;
RT-59 over Lot No. 671), the transfer certificate of title previously that another deed of absolute sale was executed for the remaining
issued to her in 1943 having been lost; that subsequently, Lot No. 671 84,356 square meters in favor also of the Iglesia and said sale was
(this time, already covered by TCT No. RT-58) was subdivided into annotated on TCT No. 168322. In view of said sales and the fact that
three (3) lots, each of which was issued a separate title, as follows: registration of the involved parcels is now in the name (separately) of
Lucia de la Cruz and the Iglesia Ni Cristo, the present action for
(a) Lot No. 671-A containing an area of 30,000 square meters and reconveyance with damages was instituted. (Emphasis supplied)
covered by TCT No. 168320;
Apparently, there is no mention of Amando Clemente in the above recital of facts. A closer
(b) Lot No. 671-B, containing an area of 4,268 square meters and perusal of the records in G. R. 76265 would, however, reveal that TCT No. 16212 was
covered by TCT No. 168321; and issued for Lot 671-A in the name of Amando Clemente on August 9, 1951 per report of the
Acting Administrator of the NLTDRA (Rollo, p. 92). Amando Clemente's TCT No. 16212
emanated from TCT No. 40355 in the name of Eugenia de la Paz and Dorotea dela Cruz.
(c) Lot No. 671-C, containing an area of 150,000 square meters and Thus, Amando Clemente's predecessors-in-interest are Eugenia dela Paz and Dorotea
covered by TCT No. 168322; dela Cruz whom the Court found to have lost their rights over Lot 671 by virtue of the sale
made to Lucia dela Cruz.
that meanwhile TCT No. 40355 (already previously issued to and in the
names of Eugenia de la Paz and Dorotea de la Cruz) continued to
exist; that when the title was transferred from the Rizal Registry to the
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
The Register of Deeds correctly observed that this is a clear case where there is a Likewise, the INK was also issued a Torrens Title over Lot 671 as a result of the sale made
duplication or overlapping of titles issued to different names over the same land which to it by the rightful owner, Lucia dela Cruz in 1975. Under the Torrens System of
thereby compelled him to file the consulta case with the NLTDRA: registration, the Torrens Title became indefeasible and incontrovertible one year from its
final decree (Tirado v. Sevilla, 188 SCRA 321 [1990]). A Torrens Title is generally a
(1) Lucia dela Cruz's reconstituted title (RT-58) which was divided into 3 Lots, Lot 671-A, conclusive evidence of the ownership of the land referred to therein. (Ching v. Court of
Lot 671-B and Lot 671-C and was subsequently sold to INK; Appeals, 181 SCRA 9 [1990]) It is, therefore, too late in the day for the petitioners to
reopen or question the legality of INK's title over Lot 671 at this time.
(2) Eugenia dela Paz and Dorotea dela Cruz's reconstituted title (RT-52) which was
divided into 2 lots, Lot 671-A and Lot 671-B. The petitioners also contend that what INK purchased from Lucia dela Cruz in 1975 was
Lot 671-C-4 LRC 322534 which corresponds roughly to Lot 671-B (Psd-32221) and did not
affect Lot 671-A of Amando Clemente at all. This is, however, belied by the fact that the
Notwithstanding, it is undisputed that Lot 671 was sold to Lucia dela Cruz by Eugenia dela sale made by Dorotea dela Cruz to Lucia dela Cruz (as indicated in Entry No. 258) was Lot
Paz and Dorotea dela Cruz as evidenced by Entry No. 258, page 7, Vol. 7, Primary Entry 671 which was later on conveyed to INK.
Book of the Registry of Deeds of Manila. (de la Cruz v. de la Cruz, supra, pp. 697-698)
This is a finding which can not be disturbed.
In challenging the validity of the reconstitution of Lucia dela Cruz's title, the petitioners are
not alleging fraud, collusion and illegality in the procurement of the certificate of title of
We need not emphasize the fact that the Supreme Court by tradition Lucia dela Cruz. It must be recalled that G.R. No. 76265 stemmed merely from
and in our system of judicial administration, has the last word on what a consulta case with the National Land Titles and Deeds Administration. Undeniably, the
the law is. It is the final arbiter of any justiciable controversy. There is arguments and issues raised by the petitioner require adjudication of facts which, under
only one Supreme Court from whose decisions all other courts should the circumstances of this case, we are not prepared to do as this Court is not a trier of
take their bearings. Consequently, we cannot and should not review a facts. Moreover, the present petition is not the proper remedy in challenging the validity of
case already passed upon by the Highest Tribunal. It is only proper to certificates of titles since the judicial action required is a direct and not a collateral attack.
allow the case to take its rest. (Church assistance Program, Inc. v. (Natalia Realty Corp. v. Vallez, 173 SCRA 534 [1989]).
Sibulo, supra.).
The Court had this to say:
The sale of the land to Lucia dela Cruz and the subsequent registration thereof in the
Primary Book of the Registry of Deeds, Manila constitutes constructive notice to the whole
world. (Heirs of Maria Marasigan v. Intermediate Appellate Court, 152 SCRA 253 [1987]; We note with approval the lower court's patient explanation that, inter
People v. Reyes, 175 SCRA 597 [1988]) alia the certificate of title issued in the name of the plaintiff in
accordance with the Land Registration Act (Act No. 496) is indefeasible
after the expiration of one year from the entry of the decree of
Since it is the act of registration which transfers ownership of the land sold (Government registration. Under Section 38 thereof, a petition for review of the
Service Insurance System v. Court of Appeals, 169 SCRA 244 [1989]). Lot 671 was decree must be presented within one year after its entry as described
already owned by Lucia dela Cruz as early as 1943. Amando Clemente's alleged title and defined in Section 40 of the same. After the lapse of one year, the
meanwhile which was issued on August 9, 1951 was very much later. Thus, the decree of registration becomes incontrovertible and is binding upon and
petitioners, who merely stepped into the shoes of Amando Clemente cannot claim a better conclusive against all persons whether or not they were notified of or
right over said land. "Prior est temporae, prior est in jura" (he who is first in time is participated in the registration proceedings. . . .
preferred in right) (Garcia v. Court of Appeals, 95 SCRA 380 [1980]). The fact that Amando
Clemente possessed a certificate of title does not necessarily make him the true owner.
And not being the owner, he cannot transmit any right to nor transfer any title or interest Even assuming arguendo that said titles may still be challenged, the
over the land conveyed (Beaterio del Santisimo Rosario de Molo v. Court of Appeals, 137 present case does not provide the vehicle for that remedy since the
SCRA 459 [1985]; Treasurer of the Phil. v. Court of Appeals, 153 SCRA 359 [1987]). judicial action required is a direct, and not a collateral attack. In fact,
under the existing law, Section 48 of the Property Registration Decree
expressly provides that a certificate of title cannot be subject to
Moreover, the petition for reconstitution of title by Lucia dela Cruz which the court held to collateral attack and can be altered, modified or cancelled only in a
be valid was a proceeding in rem. It is well established that in rem proceedings such as direct proceeding in accordance with law. (at p. 542)
land registration constitute constructive notice to the whole world. The petitioners cannot
now claim that they were not notified of the reconstitution proceedings over said lot. Under
the facts of the case, the title in the name of Lucia dela Cruz (TCT No. RT 58) has become In our capacity as the court of last resort, the petitioners try to convince us to look or
indefeasible and incontrovertible. inquire into the validity of the reconstitution proceedings initiated by Lucia dela Cruz,
contending that the implementation of de la Cruz ruling would deprive them of their
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
properties without due process of law. We have looked long and hard into the records of G.R. Nos. L-21703-04 August 31, 1966
the case but the facts and circumstances plus law and jurisprudence on the matter do not
warrant such action from the Court. INK's title over Lot 671 which necessarily included Lot MATEO H. REYES and JUAN H. REYES, petitioners and appellants,
671-A had already become incontrovertible and indefeasible. To reopen or to question the
vs.
legality of INK's title would defeat the purpose of our Torrens system which seeks to insure MATEO RAVAL REYES, respondent and appellee.
stability by quieting titled lands and putting to a stop forever any question of the legality of
the registration in the certificate or questions which may arise therefrom. (de la Cruz v. de
la Cruz, supra.) In fairness to INK, as registered owner it is entitled to rest secure in its Harold M. Hernando for petitioners and appellants.
land title. Rafael Ruiz for respondent and appellee.
In view of all the foregoing, it would be for the public interest and the maintenance of the REYES, J.B.L., J.:
integrity and stability of the Torrens system of land registration that all transfer certificates
of title derived from the reconstituted title of Eugenia dela Paz and Dorotea dela Cruz be Direct appeal on pure question of law from an order of the Court of First Instance of Ilocos
annulled in order to prevent the proliferation of derivative titles which are null and void. The Norte, in its Cadastral Cases Nos. 31, L. R. C. Rec. No. 1188, and 42, L. R. C. Rec. No.
legality or validity of INK's title over Lot 671 has been settled. The Court has spoken and it 1994, denying petitioners' motion to compel respondent to surrender their owners'
has done so with finality, logically and rightly so as to assure stability in legal relations and duplicates of Original Certificates of Title Nos. 22161 and 8066, as well as from a
avoid confusion. (see Ver v. Quetulio, 163 SCRA 80 [1988]) subsequent order of the same court, refusing, upon petitioners' motion, to reconsider the
first order of denial.
WHEREFORE, the petitions in G. R. Nos. 76265 and 83280 are hereby DISMISSED for
lack of merit. The undisputed facts are: three brothers, Mateo H., Juan H., and Francisco H., all
surnamed Reyes, are the registered owners of several parcels of land, to wit; Lots Nos.
SO ORDERED. 15891, 15896, 15902 and 15912, of the Laoag (Ilocos Norte) Cadastre, embraced in and
covered by Original Certificate of Title No. 22161, and also Lots Nos. 20481 and 20484, of
the same cadastral survey, embraced in and covered by Original Certificate of Title No.
8066, both of the Registry of Deeds of Ilocos Norte. These titles were issued pursuant to a
decree of registration, dated 31 May 1940.
On 17 July 1962, petitioners Mateo H. Reyes and Juan H. Reyes filed, in the above stated
cadastral cases, a motion for issuance of writs of possession over all the lots covered by
both Certificates of Title above referred to.
Respondent Mateo Raval Reyes opposed the motion, admitting that he is only in
possession of the lots covered by Original Certificate of Title No. 22161, but denying that
he possesses the lots covered by Original Certificate of Title No. 8066; however, he
claimed that he has been in, and is entitled to, the possession thereof (i.e., Lots Nos.
20481 and 20484), having acquired by way of absolute sale (not recorded) from
petitioners' brother, Francisco H. Reyes, the latter's undivided one-third (1/3) share,
interest and participation to these disputed lots.
After due hearing of this appellant, the court a quo issued, on 20 December 1962, the writ
of possession with respect to Lot Nos. 15891 and 15896, which writ was, upon petitioners'
motion for reconsideration, amended, on 7 January 1963, to include all the other lots
covered by both titles.
Respondent did not appeal from this order amending the writ of possession.
recover the products of the disputed lots, or their value, and moral damages against The sole issue to be resolved in the instant appeal is: who between petitioners-appellants
respondent Mateo Raval Reyes, as defendant. This case was docketed as its Civil Case or respondent-appellee has a better right to the possession or custody of the disputed
No. 3659. owners' duplicates of certificates of title.
Defendant therein (now respondent M. Raval Reyes) answered the complaint and pleaded While we agree with the court a quo that the disputed lots are subjects of litigation in Civil
a counterclaim for partition of all the disputed lots, alleging the same ground he had Case No. 3659, it appearing that respondent, as defendant therein, had presented a
heretofore raised in his answer and/or opposition to the motion for issuance of writ of counterclaim for partition of the lots covered by the titles, we see no valid and plausible
possession, i.e., he is their (plaintiffs') co-owner, he having bought from plaintiffs' brother, reason to justify, on this ground, the withholding from the registered owners, such as the
Francisco H. Reyes, the latter's undivided one-third (1/3) share, interest and participation petitioners-appellants herein, the custody and possession of the owners' duplicates of
to these disputed lots. certificates of title. In a decided case, this Court has already held that the owner of the land
in whose favor and in whose name said land is registered and inscribed in the certificate of
Pending trial on this ordinary civil case (No. 3659), petitioners presented, on 25 February title has a more preferential right to the possession of the owners' duplicate than one
1963, in the cadastral cases aforementioned, a motion to compel respondent Mateo Raval whose name does not appear in the certificate and has yet to establish his right to the
Reyes to surrender and deliver to them the owners' duplicates of Original Certificates of possession thereto. Thus, this Court said:
Title Nos. 22161 and 8066. Respondent opposed this motion.
Como acertadamente dijo el Juzgado, lo unico que se suscita es si Ana Umbao
The court a quo denied petitioners' motion, on the ground that the parcels of land covered de Carpio tiene derecho a la possession del duplicado para el dueno del
by both titles are subjects of litigation in Civil Case No. 3659 and the same has not yet Certificado de Titulo Original No. 698, con preferencia a la opositora-apelante. A
been decided on the merits by it. Petitioners subjected the foregoing order to a motion for nuestro juicio, la solucion es clara e ineludible. Hallandose admitido que el
reconsideration, but without success; hence, the present appeal. decreto final que se dicto en el expediente catastral en 28 de mayo de 1936, en
relacion con el lote No. 778, fue a favor de Ana Umbao y que el duplicado para
el dueo del Certificado de Titulo Original No. 698 se expidio por el Registrador
Petitioners-appellants dispute the above ruling of the trial court contending that, since the de Titulos a favor de la misma es obvious que quien tiene derecho a poseer el
subject matter of Civil Case No. 3659 are not the lots covered by the titles in question but certificado de titulo es ella y no la apelante (art. 41 de la Ley No. 496, tal como
their products or value, and moral damages, these lots are not in litigation in this ordinary ha sido reformado).
civil case; and that since respondent had already raised the issue of ownership and
possession of these lots in his opposition to the (petitioners') motion for issuance of writ of
Alega la apelante que ella tiene tanto derecho como la apelada a poseer el titulo
possession and, despite this opposition, the court a quo granted the writ, without any
appeal being taken, respondent is barred and estopped from raising the same issue in the porque el terreno a que se refiere es de la propiedad de las tres hermanas. La
pretension no es meritoria Segun el articulo 41 de la Ley No. 496, conforme ha
ordinary civil case, under the principle of res judicata.1wph1.t
sido enmendado, el duplicado para el dueno debe expedirse por el Registrador a
nombre de la persona a cuyo favor se ha decretado el terreno y dispone,
On the other hand, respondent-appellee maintains that, having pleaded a counterclaim for ademas, que dicho duplicado debe entregarsele al dueo inscrito. Si la apelante
partition of the lots in question in said Civil Case No. 3659, the trial court correctly held that cree que tiene derecho a participar en el lote No. 778, como coheredera, debe
these lots are subjects of litigation in this ordinary civil case. He also maintains that ejercitar una accion independiente, encaminada a obtener su participacion. (El
petitioners not having impleaded their brother, Francisco H. Reyes, or his heirs, as parties Director de Terrenos contra Abacahin 72 Phil. 326).
in their motion for issuance of writ of execution, and because these heirs have not
intervened in this particular incident, the writ of possession issued by the trial court is, at
most, valid only with respect to their (petitioners) undivided two-thirds (2/3) share and It being undisputed that respondent had already availed of an independent civil action to
participation in these disputed lots; hence, he concludes that he is not barred and recover his alleged co-owner's share in the disputed lots by filing a counterclaim for
estopped from raising the issue of ownership and possession of the undivided one-third partition in said Civil Case No. 3659, his rights appear to be amply protected; and
considering that he may also avail of, to better protect his rights thereto, the provision on
(1/3) share and participation of petitioners' brother, Francisco H. Reyes, which share
respondent allegedly bought from the latter. notice of lis pendens under Section 24, Rule 14, of the Revised Rules of Court, for the
purpose of recording the fact that the lots covered by the titles in question are litigated in
said Civil Case No. 3659, we again see no justifiable reason for respondent to retain the
In their reply brief, petitioners-appellants refute the latter argument of respondent-appellee custody of the owners' duplicates of certificates of titles.
by showing that they had previously obtained special authority from the heirs of their
deceased brother to represent them in the proceedings had in the court below.
In view of the above considerations, we deem it unnecessary to pass on the merits of the
second contention of petitioners-appellants.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Wherefore, the orders appealed from should be, as they are hereby, reversed; and, in As to [Respondent] Romana de Vera:
accordance with this opinion, respondent Mateo Raval Reyes is hereby ordered to deliver
to petitioners the owners' duplicates of Original Certificates of Title No. 22161 and 8066. 1. P300,000.00 plus 6% per annum as actual damages;
With costs against respondent-appellee, Mateo Raval Reyes.
2. P50,000.00 as moral damages;
3. P50,000.00 as exemplary damages;
4. P30,000.00 as attorneys fees; and
5. Cost of suit.
[G.R. No. 154409. June 21, 2004]
As to [Petitioner-]Spouses [Noel and Julie] Abrigo:
PANGANIBAN, J.:
The Facts
Between two buyers of the same immovable property registered under
the Torrens system, the law gives ownership priority to (1) the first registrant in good faith;
(2) then, the first possessor in good faith; and (3) finally, the buyer who in good faith
presents the oldest title. This provision, however, does not apply if the property is not Quoting the trial court, the CA narrated the facts as follows:
registered under the Torrens system.
As culled from the records, the following are the pertinent antecedents amply summarized
by the trial court:
The Case
On May 27, 1993, Gloria Villafania sold a house and lot located at Banaoang, Mangaldan,
Pangasinan and covered by Tax Declaration No. 1406 to Rosenda Tigno-Salazar and
Rosita Cave-Go. The said sale became a subject of a suit for annulment of documents
Before us is a Petition for Review[1] under Rule 45 of the Rules of Court, seeking to between the vendor and the vendees.
set aside the March 21, 2002 Amended Decision[2] and the July 22, 2002 Resolution[3] of
the Court of Appeals (CA) in CA-GR CV No. 62391. The Amended Decision disposed as
follows: On December 7, 1993, the Regional Trial Court, Branch 40 of Dagupan City rendered
judgment approving the Compromise Agreement submitted by the parties. In the said
Decision, Gloria Villafania was given one year from the date of the Compromise
WHEREFORE, the dispositive part of the original DECISION of this case, promulgated on Agreement to buy back the house and lot, and failure to do so would mean that the
November 19, 2001, is SET ASIDE and another one is entered AFFIRMING in part previous sale in favor of Rosenda Tigno-Salazar and Rosita Cave-Go shall remain valid
and REVERSING in part the judgment appealed from, as follows: and binding and the plaintiff shall voluntarily vacate the premises without need of any
demand. Gloria Villafania failed to buy back the house and lot, so the [vendees] declared
1. Declaring [Respondent] Romana de Vera the rightful owner and with better the lot in their name.
right to possess the property in question, being an innocent purchaser
for value therefor; Unknown, however to Rosenda Tigno-Salazar and Rosita Cave-Go, Gloria Villafania
obtained a free patent over the parcel of land involved [on March 15, 1988 as evidenced
2. Declaring Gloria Villafania [liable] to pay the following to [Respondent] by OCT No. P-30522]. The said free patent was later on cancelled by TCT No. 212598
Romana de Vera and to [Petitioner-]Spouses [Noel and Julie] Abrigo, to on April 11, 1996.
wit:
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
On October 16, 1997, Rosenda Tigno-Salazar and Rosita Cave-Go, sold the house and lot Petitioners raise for our consideration the issues below:
to the herein [Petitioner-Spouses Noel and Julie Abrigo].
1. Whether or not the deed of sale executed by Gloria Villafania in favor of
On October 23, 1997, Gloria Villafania sold the same house and lot to Romana de Vera x x [R]espondent Romana de Vera is valid.
x. Romana de Vera registered the sale and as a consequence, TCT No. 22515 was issued
in her name.
2. Whether or not the [R]espondent Romana de Vera is a purchaser for value in
good faith.
On November 12, 1997, Romana de Vera filed an action for Forcible Entry and Damages
against [Spouses Noel and Julie Abrigo] before the Municipal Trial Court of Mangaldan, 3. Who between the petitioners and respondent has a better title over the property
Pangasinan docketed as Civil Case No. 1452. On February 25, 1998, the parties therein
in question.[10]
submitted a Motion for Dismissal in view of their agreement in the instant case that neither
of them can physically take possession of the property in question until the instant case is
terminated. Hence the ejectment case was dismissed.[5] In the main, the issues boil down to who between petitioner-spouses and respondent
has a better right to the property.
Thus, on November 21, 1997, [petitioners] filed the instant case [with
the Regional Trial Court of Dagupan City] for the annulment of documents, injunction,
preliminary injunction, restraining order and damages [against respondent and Gloria The Courts Ruling
Villafania].
After the trial on the merits, the lower court rendered the assailed Decision dated January The Petition is bereft of merit.
4, 1999, awarding the properties to [petitioners] as well as damages. Moreover, x x x
Gloria Villafania was ordered to pay [petitioners and private respondent] damages and
attorneys fees.
Main Issue:
Not contented with the assailed Decision, both parties [appealed to the CA].[6] Better Right over the Property
Petitioners contend that Gloria Villafania could not have transferred the property to
Ruling of the Court of Appeals Respondent De Vera because it no longer belonged to her. [11] They further claim that the
sale could not be validated, since respondent was not a purchaser in good faith and for
value.[12]
In its original Decision promulgated on November 19, 2001, the CA held that a void
title could not give rise to a valid one and hence dismissed the appeal of Private
Respondent Romana de Vera.[7] Since Gloria Villafania had already transferred ownership
to Rosenda Tigno-Salazar and Rosita Cave-Go, the subsequent sale to De Vera was Law on Double Sale
deemed void.
The CA also dismissed the appeal of Petitioner-Spouses Abrigo and found no The present case involves what in legal contemplation was a double sale. On May
sufficient basis to award them moral and exemplary damages and attorneys fees. 27, 1993, Gloria Villafania first sold the disputed property to Rosenda Tigno-Salazar and
Rosita Cave-Go, from whom petitioners, in turn, derived their right. Subsequently,
On reconsideration, the CA issued its March 21, 2002 Amended Decision, finding on October 23, 1997, a second sale was executed by Villafania with Respondent Romana
Respondent De Vera to be a purchaser in good faith and for value. The appellate court de Vera.
ruled that she had relied in good faith on the Torrens title of her vendor and must thus be
protected.[8] Article 1544 of the Civil Code states the law on double sale thus:
[9]
Hence, this Petition.
Art. 1544. If the same thing should have been sold to different vendees, the ownership
shall be transferred to the person who may have first taken possession thereof in good
faith, if it should be movable property.
Issues
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Should it be immovable property, the ownership shall belong to the person acquiring it who was registered under Act 3344. For the same reason, inasmuch as the registration of the
in good faith first recorded it in the Registry of Property. sale to Respondent De Vera under the Torrens system was done in good faith, this sale
must be upheld over the sale registered under Act 3344 to Petitioner-Spouses Abrigo.
Should there be no inscription, the ownership shall pertain to the person who in good faith Radiowealth Finance Co. v. Palileo[25] explained the difference in the rules of
was first in the possession; and, in the absence thereof, to the person who presents the registration under Act 3344 and those under the Torrens system in this wise:
oldest title, provided there is good faith.
Under Act No. 3344, registration of instruments affecting unregistered lands is without
Otherwise stated, the law provides that a double sale of immovables transfers prejudice to a third party with a better right. The aforequoted phrase has been held by this
ownership to (1) the first registrant in good faith; (2) then, the first possessor in good faith; Court to mean that the mere registration of a sale in ones favor does not give him any right
and (3) finally, the buyer who in good faith presents the oldest title. [13] There is no over the land if the vendor was not anymore the owner of the land having previously sold
ambiguity in the application of this law with respect to lands registered under the same to somebody else even if the earlier sale was unrecorded.
the Torrens system.
This principle is in full accord with Section 51 of PD 1529 [14] which provides that no The case of Carumba vs. Court of Appeals[26] is a case in point. It was held therein that
deed, mortgage, lease or other voluntary instrument -- except a will -- purporting to convey Article 1544 of the Civil Code has no application to land not registered under Act No.
or affect registered land shall take effect as a conveyance or bind the land until its 496. Like in the case at bar, Carumba dealt with a double sale of the same unregistered
registration.[15] Thus, if the sale is not registered, it is binding only between the seller and land. The first sale was made by the original owners and was unrecorded while the second
the buyer but it does not affect innocent third persons. [16] was an execution sale that resulted from a complaint for a sum of money filed against the
said original owners. Applying [Section 33], Rule 39 of the Revised Rules of Court,[27] this
In the instant case, both Petitioners Abrigo and respondent registered the sale of the Court held that Article 1544 of the Civil Code cannot be invoked to benefit the purchaser at
property. Since neither petitioners nor their predecessors (Tigno-Salazar and Cave-Go) the execution sale though the latter was a buyer in good faith and even if this second sale
knew that the property was covered by the Torrens system, they registered their respective was registered.It was explained that this is because the purchaser of unregistered land at
sales under Act 3344.[17] For her part, respondent registered the transaction under a sheriffs execution sale only steps into the shoes of the judgment debtor, and merely
the Torrens system[18] because, during the sale, Villafania had presented the transfer acquires the latters interest in the property sold as of the time the property was levied
certificate of title (TCT) covering the property. [19] upon.
Respondent De Vera contends that her registration under the Torrens system should
prevail over that of petitioners who recorded theirs under Act 3344. De Vera relies on the Applying this principle, x x x the execution sale of unregistered land in favor of petitioner is
following insight of Justice Edgardo L. Paras: of no effect because the land no longer belonged to the judgment debtor as of the time of
the said execution sale.[28]
x x x If the land is registered under the Land Registration Act (and has therefore a Torrens
Title), and it is sold but the subsequent sale is registered not under the Land Registration Petitioners cannot validly argue that they were fraudulently misled into believing that
Act but under Act 3344, as amended, such sale is not considered REGISTERED, as the the property was unregistered. A Torrens title, once registered, serves as a notice to the
term is used under Art. 1544 x x x.[20] whole world.[29] All persons must take notice, and no one can plead ignorance of the
registration.[30]
We agree with respondent. It is undisputed that Villafania had been issued a free
patent registered as Original Certificate of Title (OCT) No. P-30522.[21] The OCT was later
cancelled by Transfer Certificate of Title (TCT) No. 212598, also in Villafanias name.[22] As
Good-Faith Requirement
a consequence of the sale, TCT No. 212598 was subsequently cancelled and TCT No.
22515 thereafter issued to respondent.
Soriano v. Heirs of Magali[23] held that registration must be done in the proper registry We have consistently held that Article 1544 requires the second buyer to acquire the
in order to bind the land. Since the property in dispute in the present case was already immovable in good faith and to register it in good faith.[31] Mere registration of title is not
registered under the Torrens system, petitioners registration of the sale under Act 3344 enough; good faith must concur with the registration. [32] We explained the rationale
was not effective for purposes of Article 1544 of the Civil Code. in Uraca v. Court of Appeals,[33] which we quote:
More recently, in Naawan Community Rural Bank v. Court of Appeals,[24] the Court
upheld the right of a party who had registered the sale of land under the Property Under the foregoing, the prior registration of the disputed property by the second buyer
Registration Decree, as opposed to another who had registered a deed of final does not by itself confer ownership or a better right over the property. Article 1544 requires
conveyance under Act 3344. In that case, the priority in time principle was not applied, that such registration must be coupled with good faith.Jurisprudence teaches us that (t)he
because the land was already covered by the Torrens system at the time the conveyance governing principle is primus tempore, potior jure (first in time, stronger in
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
right). Knowledge gained by the first buyer of the second sale cannot defeat the first be inapplicable to execution sales of unregistered land, since the purchaser merely steps
buyers rights except where the second buyer registers in good faith the second into the shoes of the debtor and acquires the latter's interest as of the time the property is
sale ahead of the first, as provided by the Civil Code. Such knowledge of the first buyer sold (Carumba vs. Court of Appeals, 31 SCRA 558; see also Fabian vs. Smith, Bell & Co.,
does not bar her from availing of her rights under the law, among them, to register first her 8 Phil. 496) or when there is only one sale (Remalante vs. Tibe, 158 SCRA
purchase as against the second buyer. But in converso, knowledge gained by the second 138).[39] (Emphasis supplied)
buyer of the first sale defeats his rights even if he is first to register the second sale, since
such knowledge taints his prior registration with bad faith. This is the price exacted by Santiago was subsequently applied in Bayoca v. Nogales,[40] which held:
Article 1544 of the Civil Code for the second buyer being able to displace the first buyer;
that before the second buyer can obtain priority over the first, he must show that he acted
in good faith throughout (i.e. in ignorance of the first sale and of the first buyers rights) ---- Verily, there is absence of prior registration in good faith by petitioners of the second sale
from the time of acquisition until the title is transferred to him by registration, or failing in their favor. As stated in the Santiago case, registration by the first buyer under Act No.
registration, by delivery of possession. [34] (Italics supplied) 3344 can have the effect of constructive notice to the second buyer that can defeat his
right as such buyer. On account of the undisputed fact of registration under Act No. 3344
by [the first buyers], necessarily, there is absent good faith in the registration of the sale by
Equally important, under Section 44 of PD 1529, every registered owner receiving a the [second buyers] for which they had been issued certificates of title in their names.
certificate of title pursuant to a decree of registration, and every subsequent purchaser of x x x.[41]
registered land taking such certificate for value and in good faith shall hold the same free
from all encumbrances, except those noted and enumerated in the certificate. [35] Thus, a
person dealing with registered land is not required to go behind the registry to determine Santiago and Bayoca are not in point. In Santiago, the first buyers registered the sale
the condition of the property, since such condition is noted on the face of the register or under the Torrens system, as can be inferred from the issuance of the TCT in their
certificate of title.[36] Following this principle, this Court has consistently held as regards names.[42] There was no registration under Act 3344. In Bayoca, when the first buyer
registered land that a purchaser in good faith acquires a good title as against all the registered the sale under Act 3344, the property was still unregistered land. [43] Such
transferees thereof whose rights are not recorded in the Registry of Deeds at the time of registration was therefore considered effectual.
the sale.[37]
Furthermore, Revilla and Taguba, which are cited in Santiago, are not on all fours
Citing Santiago v. Court of Appeals,[38] petitioners contend that their prior registration with the present case. In Revilla, the first buyer did not register the sale. [44] In Taguba,
under Act 3344 is constructive notice to respondent and negates her good faith at the time registration was not an issue.[45]
she registered the sale. Santiagoaffirmed the following commentary of Justice Jose C.
Vitug: As can be gathered from the foregoing, constructive notice to the second buyer
through registration under Act 3344 does not apply if the property is registered under
the Torrens system, as in this case.
The governing principle is prius tempore, potior jure (first in time, stronger in right).
Knowledge by the first buyer of the second sale cannot defeat the first buyer's rights We quote below the additional commentary of Justice Vitug, which was omitted
except when the second buyer first registers in good faith the second sale (Olivares vs. in Santiago. This omission was evidently the reason why petitioner misunderstood the
Gonzales, 159 SCRA 33). Conversely, knowledge gained by the second buyer of the first context of the citation therein:
sale defeats his rights even if he is first to register, since such knowledge taints his
registration with bad faith (see also Astorga vs. Court of Appeals, G.R. No 58530, 26 "The registration contemplated under Art. 1544 has been held to refer to registration under
December 1984) In Cruz vs. Cabana (G.R. No. 56232, 22 June 1984; 129 SCRA 656), it Act 496 Land Registration Act (now PD 1529) which considers the act of registration as the
was held that it is essential, to merit the protection of Art. 1544, second paragraph, that the operative act that binds the land (see Mediante vs. Rosabal, 1 O.G. [12] 900, Garcia vs.
second realty buyer must act in good faith in registering his deed of sale (citing Carbonell Rosabal, 73 Phil 694). On lands covered by the Torrens System, the purchaser acquires
vs. Court of Appeals, 69 SCRA 99, Crisostomo vs. CA, G.R. 95843, 02 September 1992). such rights and interest as they appear in the certificate of title, unaffected by any prior lien
or encumbrance not noted therein. The purchaser is not required to explore farther than
xxxxxxxxx what the Torrens title, upon its face, indicates. The only exception is where the purchaser
has actual knowledge of a flaw or defect in the title of the seller or of such liens or
encumbrances which, as to him, is equivalent to registration (see Sec. 39, Act
Registration of the second buyer under Act 3344, providing for the registration of all
496; Bernales vs. IAC, G.R. 75336, 18 October 1988; Hernandez vs. Sales, 69 Phil
instruments on land neither covered by the Spanish Mortgage Law nor the Torrens System
744; Tajonera vs. Court of Appeals, L-26677, 27 March 1981),"[46]
(Act 496), cannot improve his standing since Act 3344 itself expresses that registration
thereunder would not prejudice prior rights in good faith (see Carumba vs. Court of
Appeals, 31 SCRA 558). Registration, however, by the first buyer under Act 3344 can
have the effect of constructive notice to the second buyer that can defeat his right Respondent
as such buyer in good faith (see Arts. 708-709, Civil Code; see also Revilla vs. in Good Faith
Galindez, 107 Phil. 480; Taguba vs. Peralta, 132 SCRA 700). Art. 1544 has been held to
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
The Court of Appeals examined the facts to determine whether respondent was an REPUBLIC OF THE PHILIPPINES, G.R. No. 185091
innocent purchaser for value.[47] After its factual findings revealed that Respondent De REPRESENTED BY THE
Vera was in good faith, it explained thus: DEPARTMENT OF EDUCATION
DIVISION OF LIPA CITY (FOR
x x x. Gloria Villafania, [Respondent] De Veras vendor, appears to be the registered PANINSINGIN PRIMARY SCHOOL),
owner. The subject land was, and still is, registered in the name of Gloria Villafania. There Petitioner, Present:
is nothing in her certificate of title and in the circumstances of the transaction or sale which CARPIO, J., Chairperson,
warrant [Respondent] De Vera in supposing that she need[ed] to look beyond the title. She - versus - ABAD,
had no notice of the earlier sale of the land to [petitioners]. She ascertained and verified VILLARAMA, JR.,*
that her vendor was the sole owner and in possession of the subject property by examining PEREZ,** and
her vendors title in the Registry of Deeds and actually going to the premises. There is no MENDOZA, JJ.
evidence in the record showing that when she bought the land on October 23, 1997, she PRIMO MENDOZA and
MARIA LUCERO, Promulgated:
knew or had the slightest notice that the same was under litigation in Civil Case No. D-
10638 of the Regional Trial Court of Dagupan City, Branch 40, between Gloria Villafania Respondents.
August 8, 2010
and [Petitioners] Abrigo. She was not even a party to said case. In sum, she testified
clearly and positively, without any contrary evidence presented by the [petitioners], that
she did not know anything about the earlier sale and claim of the spouses Abrigo, until x --------------------------------------------------------------------------------------- x
after she had bought the same, and only then when she bought the same, and only then
when she brought an ejectment case with the x x x Municipal Court of Mangaldan, known DECISION
as Civil Case No. 1452. To the [Respondent] De Vera, the only legal truth upon which she
had to rely was that the land is registered in the name of Gloria Villafania, her vendor, and
that her title under the law, is absolute and indefeasible. x x x.[48] ABAD, J.:
We find no reason to disturb these findings, which petitioners have not This case is about the propriety of filing an ejectment suit against the
rebutted. Spouses Abrigo base their position only on the general averment that respondent
Government for its failure to acquire ownership of a privately owned property that it had
should have been more vigilant prior to consummating the sale. They argue that had she
inspected the property, she would have found petitioners to be in possession. [49] long used as a school site and to pay just compensation for it.
This argument is contradicted, however, by the spouses own admission that the
parents and the sister of Villafania were still the actual occupants in October 1997, when
Respondent De Vera purchased the property.[50] The family members may reasonably be
assumed to be Villafanias agents, who had not been shown to have notified respondent of The Facts and the Case
the first sale when she conducted an ocular inspection. Thus, good faith on respondents
part stands.
WHEREFORE, the Petition is DENIED and the assailed Decision AFFIRMED. Costs Paninsingin Primary School (PPS) is a public school operated
against petitioners.
by petitioner Republic of the Philippines (the Republic) through the Department of
SO ORDERED.
Education. PPS has been using 1,149 square meters of land in Lipa City, Batangas since
1957 for its school. But the property, a portion of Lots 1923 and 1925, were registered in
the name of respondents Primo and Maria Mendoza (the Mendozas) under Transfer
On March 27, 1962 the Mendozas caused Lots 1923 and 1925 to be
On July 13, 1999 the MTCC rendered a decision, dismissing the complaint on
Lot 1 292 square meters in favor of Claudia Dimayuga
Lot 2 292 square meters in favor of the Mendozas ground of the Republics immunity from suit.[7] The Mendozas appealed to the Regional
Lot 3 543 square meters in favor of Gervacio Ronquillo; and
Lot 4 1,149 square meters in favor of the City Government of Lipa[2] Trial Court (RTC) of Lipa Citywhich ruled that the Republics consent was not necessary
since the action before the MTCC was not against it.[8]
As a result of subdivision, the Register of Deeds partially cancelled TCT T-11410 In light of the RTCs decision, the Mendozas filed with the MTCC a motion to
and issued new titles for Lots 1 and 3 in favor of Dimayuga and Ronquillo, respectively. Lot render judgment in the case before it.[9] The MTCC denied the motion, however, saying
2 remained in the name of the Mendozas but no new title was issued in the name of the that jurisdiction over the case had passed to the RTC upon appeal. [10] Later, the RTC
City Government of Lipa for Lot 4.[3] Meantime, PPS remained in possession of the remanded the case back to the MTCC,[11] which then dismissed the case for insufficiency
property. of evidence.[12] Consequently, the Mendozas once again appealed to the RTC in Civil Case
The Republic claimed that, while no title was issued in the name of the City 2001-0236.
Government of Lipa, the Mendozas had relinquished to it their right over the school lot as
evidenced by the consolidation and subdivision plan. Further, the property had long been On June 27, 2006 the RTC found in favor of the Mendozas and ordered PPS to
tax-declared in the name of the City Government and PPS built significant, permanent vacate the property. It held that the Mendozas had the better right of possession since they
improvements on the same. These improvements had also been tax-declared.[4] were its registered owners. PPS, on the other hand, could not produce any document to
prove the transfer of ownership of the land in its favor. [13] PPS moved for reconsideration,
The Mendozas claim, on the other hand, that although PPS sought permission from them but the RTC denied it.
to use the property as a school site, they never relinquished their right to it. They allowed
PPS to occupy the property since they had no need for it at that time. Thus, it has The Republic, through the Office of the Solicitor General (OSG), appealed the
remained registered in their name under the original title, TCT T-11410, which had only RTC decision to the Court of Appeals (CA) in CA-G.R. SP 96604 on the grounds that: (1)
been partially cancelled. the Mendozas were barred by laches from recovering possession of the school lot; (2)
sufficient evidence showed that the Mendozas relinquished ownership of the subject lot to
On November 6, 1998 the Mendozas wrote PPS, demanding that it vacate the the City Government of Lipa City for use as school; and (3) Lot 4, Pcs-5019 has long been
disputed property.[5] When PPS declined to do so, on January 12, 1999 the Mendozas filed declared in the name of the City Government since 1957 for taxation purposes. [14]
a complaint with the Municipal Trial Court in Cities (MTCC) of Lipa City in Civil Case 0002-
99 against PPS for unlawful detainer with application for temporary restraining order and In a decision dated February 26, 2008, the CA affirmed the RTC
[15]
writ of preliminary injunction.[6] decision. Upholding the Torrens system, it emphasized the indefeasibility of
the Mendozas registered title and the imprescriptible nature of their right to eject any
person occupying the property. The CA held that, this being the case, the Republics
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
possession of the property through PPS should be deemed merely a tolerated one that Republic itself admits that no new title was issued to it or to any of its subdivisions for the
could not ripen into ownership. portion that PPS had been occupying since 1957. [19]
documentary evidence to prove the transfer of the property in favor of the That the City Government of Lipa tax-declared the property and its improvements
government. Moreover, even assuming that the Mendozas relinquished their right to the in its name cannot defeat the Mendozas title. This Court has allowed tax declarations to
property in 1957 in the governments favor, the latter never took steps to have the title to stand as proof of ownership only in the absence of a certificate of title. [20] Otherwise, they
the property issued in its name or have its right as owner annotated on have little evidentiary weight as proof of ownership. [21]
the Mendozas title. The CA held that, by its omissions, the Republic may be held in
estoppel to claim that the Mendozas were barred by laches from bringing its action. The CA erred, however, in ordering the eviction of PPS from the property that it
With the denial of its motion for reconsideration, the Republic has taken recourse had held as government school site for more than 50 years. The evidence on record
to this Court via petition for review on certiorari under Rule 45. shows that the Mendozas intended to cede the property to the City Government of Lipa
permanently. In fact, they allowed the city to declare the property in its name for tax
The Issue Presented purposes. And when they sought in 1962 to have the bigger lot subdivided into four,
The issue in this case is whether or not the CA erred in holding that the Mendozas earmarked Lot 4, containing 1,149 square meters, for the City Government
the Mendozas were entitled to evict the Republic from the subject property that it had used of Lipa. Under the circumstances, it may be assumed that the Mendozas agreed to
for a public school. transfer ownership of the land to the government, whether to the City Government of Lipa
The Courts Ruling or to the Republic, way back but never got around to do so and the Republic itself
A decree of registration is conclusive upon all persons, including the Government altogether forgot about it. Consequently, the Republic should be deemed entitled to
of the Republic and all its branches, whether or not mentioned by name in the application possession pending the Mendozas formal transfer of ownership to it upon payment of just
[16]
for registration or its notice. Indeed, title to the land, once registered, is compensation.
imprescriptible.[17] No one may acquire it from the registered owner by adverse, open, and The Court holds that, where the owner agrees voluntarily to the taking of his
[18]
notorious possession. Thus, to a registered owner under the Torrens system, the right to property by the government for public use, he thereby waives his right to the institution of a
recover possession of the registered property is equally imprescriptible since possession is formal expropriation proceeding covering such property. Further, as the Court also held
a mere consequence of ownership. in Eusebio v. Luis,[22] the failure for a long time of the owner to question the lack of
expropriation proceedings covering a property that the government had taken constitutes a
Here, the existence and genuineness of the Mendozas title over the property has waiver of his right to gain back possession. The Mendozas remedy is an action for the
not been disputed. While the consolidation and subdivision plan of Lots 1923 and 1925 payment of just compensation, not ejectment.
shows that a 1,149 square meter lot had been designated to the City Government, the
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Since the MTCC did not have jurisdiction either to evict the Republic from the On May 21, 1952, Gregorio Dy Tam instituted Special Proceeding No. 1537 of said court,
entitled In the matter of the Intestate Estate of the Deceased Rafael Litam. The petition
land it had taken for public use or to hear and adjudicate the Mendozas right to just therein filed, dated April 24, 1952, states that Petitioner is the son of Rafael Litam, who
died in Manila on January 10, 1951; chan roblesvirtualawlibrarythat the deceased was
compensation for it, the CA should have ordered the complaint for unlawful detainer survived by:chanroblesvirtuallawlibrary
dismissed without prejudice to their filing a proper action for recovery of such Li Hong Hap 40 years
Li Ho 37 years
compensation.
Gregorio Dy Tam 33 years
Henry Litam alias Dy Bun Pho 29 years
WHEREFORE, the Court partially GRANTS the petition, REVERSES the
Beatriz Lee Tam alias Lee Giak Ian 27 years
February 26, 2008 decision and the October 20, 2008 resolution of the Court of Appeals in
Elisa Lee Tam alias Lee Giok Bee 25 years
CA-G.R. 96604, and ORDERSthe dismissal of respondents Primo and Maria Mendozas William Litam alias Li Bun Hua 23 years
action for eviction before the Municipal Trial Court in Cities of Lipa City in Civil Case 0002- Luis Litam alias Li Bun Lin 22 years
99 without prejudice to their filing an action for payment of just compensation against the that the foregoing children of the decedent by a marriage celebrated in China in 1911 with
Sia Khin, now deceased; chan roblesvirtualawlibrarythat after the death of Rafael
Republic of the Philippines or, when appropriate, against the City of Lipa. Litam, Petitioner and his co-heirs came to know that the decedent had, during the
subsistence of said marriage with Sia Khin, contracted in 1922 in the
Philippines cralaw another marriage with Marcosa Rivera, Filipino citizen; chan
roblesvirtualawlibrarythat the decedent left as his property among others, his one-half
(1/2) share valued at P65,000 in the purported conjugal properties between him and
Marcosa Rivera, which cralaw partnership consisted of the following real property
SO ORDERED. acquired during the marriage between him and Marcosa Rivera, to
wit:chanroblesvirtuallawlibrary
(1) Three (3) parcels of land covered by Transfer Certificate of Title No. 1228 of the
Registry of Deeds of the province of Pampanga:chanroblesvirtuallawlibrary
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
(2) One (1) parcel of land covered by Transfer Certificate of Title No. 26011 of the (5) 1 parcel of land (plan psu-93067, swo-16049) situated in Barrio of Quibadia,
Registry of Deeds of the province of Bulacan. Municipality of Obando, Province of Bulacan, covered by Transfer Certificate of Title No.
26011 of the Registry of Deeds for the Province of Bulacan, issued on April 9, 1943;
and that the decedent had left neither a will nor debt. Petitioner prayed, therefore, that,
after appropriate proceedings, letters of administration be issued to Marcosa Rivera, the Other properties are located in Bataan province.
surviving spouse of the decedent. Soon thereafter, Marcosa Rivera filed a counter-
petition:chanroblesvirtuallawlibrary (1) substantially denying the alleged marriage of the All properties total an assessed value of approximately P150,000.00.
decedent to Sia Khin, as well as the alleged filiation of the persons named in the In said complaint, Plaintiffs prayed that the judgment be
petition; chan roblesvirtualawlibrary(2) asserting that the properties described herein are rendered:chanroblesvirtuallawlibrary
her paraphernal properties, and that the decedent had left unpaid debts, and certain
properties in Bulan and Casiguran, Sorsogon, and in Virac, Catanduanes, apart from (1) declaring the aforesaid properties as belonging to the conjugal partnership or tenancy
shares of stock in a private corporation known by the name of Litam Co., Inc.; chan in common which existed between the deceased Rafael Litam and the incompetent
roblesvirtualawlibraryand (3) praying that her nephew, Arminio Rivera, be appointed Marcosa Rivera;
administrator of the intestate estate of the deceased.
(2) ordering the Defendants to deliver the aforesaid properties to the administration of the
In due course, the court granted this petition and letters of administration were issued to estate of the deceased Rafael Litam (Rule 75, section 2, Rules of Court);
Arminio Rivera, who assumed his duties as such, and, later, submitted an inventory of the
(3) ordering the said Defendants further to render an accounting of the fruits they
alleged estate of Rafael Litam. Inasmuch as said inventory did not include the properties
collected from the aforesaid properties and to deliver the same to the administration of the
mentioned in the petition, dated April 24, 1952, of Gregorio Dy Tam, the latter filed, on
estate of the deceased Rafael Litam;
November 29, 1952, a motion for the removal of Rivera as administrator of the
aforementioned estate. This led to a number of incidents hinging on the question whether (4) ordering the said Defendants to pay the administration of the estate of the deceased
said properties belong in common to the decedent and Marcosa Rivera or to the latter Rafael Litam damages in double the value of the fruits mentioned in the preceding
exclusively. paragraph which they embezzled; chan roblesvirtualawlibraryand
Meanwhile, Remedios R. Espiritu was appointed, in Special Proceeding No. 1709 of the (5) ordering the Defendants to pay the costs. The Plaintiffs further pray for such other
Court of First Instance of Rizal, guardian of Marcosa Rivera, who had been declared remedy as the Court may deem just and equitable in the premises.
incompetent. Thereafter, or on April 20, 1953, Gregorio Dy Tam and his alleged brothers
and sisters aforementioned, filed the complaint in Civil Case No. 2071 of the same court, In her answer to the complaint, Marcosa Rivera reiterated, in effect, the allegations in her
against Remedios R. Espiritu, as guardian of Marcosa Rivera, and Arminio Rivera. In said counter-petition, dated July 12, 1952, in Special Proceeding No. 1537, and set up some
complaint, Plaintiffs therein reproduced substantially the allegations made in the affirmative and special defenses, as well as a counter-claim for attorneys fees and
aforementioned petition of Gregorio Dy Tam dated April 24. 1952, except that the damages in the aggregate sum of P110,000.00.
properties acquired during the existence of marriage between Rafael Litam and Marcosa Owning to the identity of the issue raised in said Civil Case No. 2071 and in the
Rivera and/or with their joint efforts during the time that they lived as husband and wife aforementioned incidents in Special Proceeding No. 1537, both were jointly heard. Later
were said to be more than those specified in said petition, on, the court rendered a decision.
namely:chanroblesvirtuallawlibrary
(1) Dismissing Civil Case No. 2071, with costs against the Plaintiffs;
(1) 3 parcels of land situated in the Municipality of Macabebe, Province of Pampanga,
covered by Transfer Certificate of Title No. 1228 of the Registry of Deeds for the Province (2) Sentencing the Plaintiff in Civil Case No. 2071, under the Defendants counterclaim,
of Pampanga, issued on July 29, 1947; to pay jointly and severally each of the Defendants the sum of P5,000.00 as actual
damages and P25,000.00 as moral damages;
(2) 2 Parcels of land, together with all buildings and improvements thereon except those
expressly noted in the title as belonging to other persons, situated in the Municipality of (3) Declaring that the properties in question, namely:chanroblesvirtuallawlibrary the
Navotas, Province of Rizal, covered by Transfer Certificate of Title No. 35836 of the fishponds, consisting of three parcels, situated in Macabebe, Pampanga, with Transfer
Registry of Deeds for the Province of Rizal, issued on October 4, 1938; certificate of Title No. 1228 of the land records of Pampanga, one-half undivided portion of
the fishponds, consisting of two parcels, situated in Navotas, Rizal, covered by Transfer
(3) 1 parcel of land situated in the Municipality of Malabon, Province of Rizal, covered by Certificate of Title No. 35836, the parcel of land with the improvements thereon situated in
Transfer Certificate of Title No. 23248 of the Registry of Deeds for the Province of Rizal, Malabon, Rizal, covered by Transfer Certificate of Title No. 23248, both of the land records
issued on June 12, 1933; of Rizal, and the fishponds, consisting of two parcels, situated in Obando, Bulacan,
(4) 1 parcel of land situated in Barrio of Kay-Badia, Municipality of Obando, Province of covered by Transfer Certificates of Title Nos. 21809 and 26011, both of the land records of
Bulacan, covered by Transfer Certificate of Title No. 21809 of the Registry of Deeds for the Bulacan, are the exclusive, separate and paraphernal properties of Marcosa Rivera; chan
Province of Bulacan, issued on May 25, 1939; roblesvirtualawlibraryand
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
(4) Declaring that the Plaintiffs in Civil Case No. 2071 (who are the same persons alleged Rafael Litam of the latters supposed marriage with Sia Khin. His testimony is
to be children of Rafael Litam in the petition, dated April 24, 1952, filed by the Petitioner in uncorroborated. The court noticed that the said witness was only 22 years old when he
Sp. Proc. No. 1537) are not the children of the deceased Rafael Litam, and that his only testified, and it appears in the petition filed by the Petitioner in Sp. Proc. No. 1537 that said
heir is his surviving wife, Marcosa Rivera. witness is the youngest of all the alleged eight children of Rafael Litam. The Court is at a
loss to understand why one or some of the older alleged children of Rafael Litam were not
The two (2) Cases are now before us on appeal taken by the Petitioner in Special presented as witnesses in view of the unreliable testimony of Luis Litam, and considering
Proceeding No. 1537 and the Plaintiffs in Civil Case No. 2071. The issues for that older persons are better qualified to testify on the matters sought to be proved which
determination are:chanroblesvirtuallawlibrary (1) Are Appellants the legitimate children of allegedly happened a long time ago.
Rafael Litam? (2) Is Marcosa Rivera the exclusive owner of the properties in question, or
do the same constitute a common property of her and the decedent? The birth certificate presented by the Plaintiff in Civil Case No. 2071 and Petitioner in Sp.
Proc. No. 1537 cannot be given even little consideration, because the name of the father
The first issue hinges on whether Rafael Litam and Sia Khin were married in 1911, and of the children appearing therein is not Rafael Litam, but different persons. It is very
whether Rafael Litam is the father of Appellants herein. In this connection, the lower court significant to note that the names of the father of the persons appearing in said birth
had the following to say:chanroblesvirtuallawlibrary certificates are Dy Tham, Li Tam, Lee Tham, Rafael Dy Tam, and that said persons were
cralaw the evidence weikhs very heavily in favor of the theory of the Defendants in Civil born in different places, some in Amoy, China, another Fukien, China, and the other in
Case No. 2071 to the effect that the said deceased Rafael Litam was not married to Sia Limtao, China. It also appears in said birth certificates that the childrens mothers named
Khin and that Plaintiffs, are not the children of the said decedent. The Plaintiffs in Civil therein are different, some being Sia Khim, others Sia Quien, the other Sia Khun, and still
Case No. 2071 and the Petitioner in Sp. Proc. No. 1537 have utterly failed to prove their another Sia Kian. These documents do not establish the identity of the deceased Rafael
alleged status as children of Rafael Litam by a marriage with Sia Khin. Litam and the persons named therein as father. Besides, it does not appear in the said
certificates of birth that Rafael Litam had in any manner intervened in the preparation and
It appears from the evidence presented by the Defendants in civil Case No. 2071 and the filing thereof.
administrator and the counter-Petitioner in Sp. Proc. No. 1537 that there was no such
marriage between the deceased Rafael Litam and Sia Khin and that the Plaintiffs named in The other documentary evidence presented by the said Plaintiffs and Petitioner are
Civil Case No. 2071 are not children of said deceased. The various official and public entirely immaterial and highly insufficient to prove the alleged marriage between the
documents executed by Rafael Litam himself convincingly show that he had not contracted deceased Rafael Litam and Sia Khin and the alleged statue of the Plaintiffs as children of
any marriage with any person other than Marcosa Rivera, and that he had no child. In the said decedent.
marriage certificate, (Exhibit 55) it was clearly stated that he was single when he married It is, therefore, the finding of this Court that the Plaintiffs named in Civil Case No. 2071 are
Marcosa Rivera on June 10, 1922. In the sworn application for alien certificate of not heirs of the said decedent, his only heir being his surviving wife, Marcosa Rivera.
registration dated July 7, 1950 (Exhibit 1), Rafael Litam unequivocably declared under oath (Emphasis ours.)
that he had no child. In the several other documents executed by him and presented in
evidence, (Exhibits 19, 21, 22, 23, 46 and 46-A) Rafael Litam had consistently referred to The findings of fact thus made in the decision appealed from are borne out by the records
Marcosa Rivera alone as his wife; chan roblesvirtualawlibraryhe had never mentioned of and the conclusion drawn from said facts is, to our mind, substantially correct.
Sia Khin as his wife, or of his alleged children.
Appellants evidence on this point consists of the testimony of Appellant Li Bun Lin, who
The witnesses presented by the Defendants in Civil Case No. 2071 and the administrator said that he is, also known as Luis Litam; chan roblesvirtualawlibrarythat his co-
and counter Petitioner in Sp. Proc. No. 1537 positively testified to the effect that they know Appellants are his brothers and sisters; chan roblesvirtualawlibrarythat their parents are
that Rafael Litam did not have any child, nor was he married with Sia Khin. An impartial the decedent and Sia Khin, who were married in China in 1911; chan
and disinterested witness, Felipe Cruz, likewise testified that he has known Rafael Litam roblesvirtualawlibraryand that Sia Khin died in Manila during the Japanese occupation. He
even before his marriage with Marcosa Rivera and that said Rafael Litam did not have any likewise, identified several pictures, marked Exhibits I to S, which were claimed to be
child. family portraits, but the lower court rejected their admission in evidence. Although we
agree with herein Appellants that this was an error, it is clear to us that said pictures and
On the other hand, the Plaintiffs in Civil Case No. 2071 and the Petitioner in Sp. Proc. No. the testimony of Luis Litam, as well as the other evidence adverted to in the above-quoted
1537 presented in support of their theory the testimony of their lone witness, Luis Litam, portion of the decision appealed from, are far from sufficient to outweigh, or even offset,
and certain documentary evidence. It is noteworthy that the said Plaintiffs and the evidence in favor of the Appellees.
said Petitioner did not present in evidence the marriage certificate of Rafael Litam and Sia
Khin, which in the opinion of the Court, is the competent and best evidence of the alleged It should be noted that the decedent had admittedly married Marcosa Rivera in 1922. In
marriage between them. No explanation has been given for the non-presentation of said the very petition of Appellant Gregorio Dy Tam, in Special Proceeding No. 1537, dated
marriage certificate, nor has there been any showing of its loss. Neither have April 24, 1952, he alleged that Marcosa Rivera is the surviving spouse of the decedent. In
said Plaintiffs and said Petitioner presented any competent secondary evidence of the their complaint in Civil Case No. 2071, Appellants specifically admitted and averred the
supposed marriage. existence of the marriage between said Rafael Litam and Marcosa Rivera which would
have been void ab initio, and, hence, inexistent legally, if Appellants pretense were true or
The testimony of the lone witness, Luis Litam, cannot be given any credence and value at they believed it to be so and that they had lived as husband and wife. Again, although
all. His testimony is mostly hearsay, as according to him, he was merely informed by
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Gregorio Dy Tam, asserted, in his aforementioned petition, that he and his co-heirs came Rafael Litam, also under oath, acknowledge the fact that the sums of P13,000.00 and
to know about the marriage of the decedent and Marcosa Rivera after the death of Rafael P10,000.00 loaned by Marcosa Rivera to the spouses Catalino Pascual and Juliana
Litam, the very testimony of Li Bun Lin, as witness for the Appellants, show, beyond Pascual, and to Juliana Pascual, respectively, are the separate and exclusive money of
doubt, that said Appellants knew, during the lifetime of Rafael Litam that he and Marcosa Marcosa Rivera, in which money Rafael Litam had no interest whatsoever. In Exhibit 19,
Rivera were living in Malabon, Rizal, openly and publicly, as husband and wife, and same Rafael Litam acknowledged the fact that he had obtained, before the outbreak of the
regarded her as his lawful wife. Indeed, in the course of his testimony, said Li Bun Lin second world war, from Marcosa Rivera the sum of P135,000.00 which belongs
alluded to her as his mother. In other words, aside from the circumstance that the exclusively to the latter, and that after the liberation, or more specifically, on January 4,
wedding and marital life of Marcosa Rivera and Rafael Litam is undisputed, it is, also, an 1946, he stole from Marcosa Rivera the further sum of P62,000.00, also belonging
established fact that they had the general reputation of being legally married and were so exclusively to the latter, which amounts, totalling P197,000.00, exclusive of interests, have
regarded by the community and by Appellants herein, during the lifetime of Rafael Litam. not, according to the evidence, been paid to her up to the present. In Exhibits 46 and 46-A,
it was acknowledged by Rafael Litam that he had not given any money to his wife,
Upon the other hand, Appellants maintain, in effect, that Rafael Litam was guilty of the Marcosa Rivera, and that they have actually adopted a system of separation of property,
crime of bigamy; chan roblesvirtualawlibrarythat he had, likewise, willfully and maliciously each of them not having any interest or participation whatsoever in the property of the
falsified public and official documents; chan roblesvirtualawlibraryand that, other. These declarations and admission of fact made by Rafael Litam against his interest
although Appellants and Sia Khin were living in Manila and Marcosa Rivera are binding upon him, his heirs and successors in interests and third persons as well.
whom Appellants knew resided only a few kilometers away, in Malabon, Rizal where (Secs. 7 & 29, Rule 123, Rules of Court).
Rafael Litam returned daily, after attending to his business in Manila, the decedent had
succeeded, for about thirty (30) years, in keeping each party in complete ignorance of the The finding of this Court that the properties in question are paraphernal properties of
nature of his alleged relations with the other. Apart from the highly improbable nature of Marcosa Rivera, having been bought by her with her separate and exclusive money, is
the last part of Appellants pretense, it is obvious that the same cannot be sustained unless further strengthened by the fact that, as it is clearly disclosed by the evidence when
the evidence in support thereof is of the strongest possible kind, not only because it entails Marcosa Rivera married Rafael Litam in 1922, she was already rich, she having already
the commission by Rafael Litam of grave criminal offenses which are derogatory to his earned and saved money as consignataria while she was still single. It also appears that
honor, but, also, because death has sealed his lips, thus depriving him of the most she was born of a rich family, her father, Eduardo Rivera, being the owner of fishponds,
effective means of defense. The proof for Appellants herein does not satisfy such commercial and residential lands and buildings, (Exhibits 5 to 18, inclusive), with an
requirement. assessed value of around P150,000.00 (Exhibits 25 and 42, inclusive), now worth
approximately a million pesos, and most of which properties as may be seen from the
As regards the title to the properties in dispute, the evidence thereon was analyzed by the certificates of title were acquired by him way back in the years 1916 and 1919. When
lower court in the following language:chanroblesvirtuallawlibrary Eduardo Rivera died on February 5, 1942, his cash and jewelry were inherited by his
It has been established by the evidence that the properties in question were bought by eldest daughter, Rafaela Rivera, and when the latter died single on July 2, 1943, Marcosa
Marcosa Rivera with her separate and exclusive money. The fishponds situated in Rivera inherited her cash amounting to P150,000.00, Philippine currency, and and her
Obando, Bulacan, covered by Transfer Certificate of Title Nos. 21809 and 26011, the one- pieces of jewelry. It is with this amount and with the proceeds of the sale of some of said
half (1/2) undivided portion of the fishponds situated in Navotas, Rizal with Transfer pieces of jewelry that Marcosa Rivera purchased the fishponds in question, situated in
Certificate of Title No. 35836, and the property situated in Hulong-Duhat, Malabon, Rizal, Macabebe, Pampanga.
with Transfer Certificate of Title No. 23248 were all purchased by Marcosa Rivera with the On the other hand, it appears from the evidence that when Rafael Litam was on June 10,
money she earned and accumulated while she was still single; chan 1922, married to Marcosa Rivera, he was poor. He had to borrow from Marcosa Rivera,
roblesvirtualawlibrarywhile the fishponds situated in Macabebe, Pampanga with Transfer the sum of P135,000.00 belonging exclusively to her before the outbreak of the war, and to
Certificate of Title No. 1228 were purchased by her with the money she inherited from her steal from her further sum of P62,000.00 after the liberation (Exhibit 10). The said amounts
late sister, Rafaela Rivera and with the money she received from the proceeds of the sale totalling P197,000.00, exclusive of the stipulated interests, according to the evidence, have
of the pieces of jewelry she inherited from her father Eduardo Rivera and her sister not been paid to Marcosa Rivera up to the present. Rafael Litam did not contribute any
Rafaela Rivera. The properties in question, having been bought by Marcosa Rivera, amount of money or labor to the properties in question, as he and Marcosa Rivera
although during her marriage with Rafael Litam, with her exclusive and separate money, maintained an absolute separation of property (Exhibits 46 and 46-A). Besides, during his
said properties are undeniably her paraphernal properties. (Art. 1396, Spanish Civil Code, lifetime he used to go his office in Manila everyday.
which is the same as Art. 148 of the Civil Code of the Phil.)
Another circumstance which clearly proves that the properties in question belong
Great importance should be given to the documentary evidence, exclusively to Marcosa Rivera is the established fact that before she became incompetent
vis:chanroblesvirtuallawlibrary Exhibits 21, 22, 23, 19, 46 and 46-A, presented by sometime in the early part of the year, 1953, she had been administering said properties,
the Defendants, in Civil Case No. 2071 and the administrator and counter- Petitioner in Sp. to the exclusion of Rafael Litam. In fact, as may be seen from the very documentary
Proc. No. 1537, which prove beyond peradventure of any doubt that the properties in evidence (Exhibit EE, same as Nxh. 50) presented by the Plaintiffs in Civil Case No. 2071
question are the paraphernal properties of Marcosa Rivera. In Exhibit 21, Rafael Litam themselves and Petitioner in Sp. Proc. No. 1537, she alone leased the properties in
unequivocably declared under his oath that the money paid by Marcosa Rivera for the question, situated in Macabebe, Pampanga, and the corresponding lease contract, dated
fishponds in Obando, Bulacan was her exclusive and separate money which was earned July 13, 1948 was signed by her as lessor and by Rafael Suarez, Jr. as lessees.
by her while she was still single. In Exhibits 22 and 23, both dated June 16, 1947, same
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Furthermore, the properties in question have been declared in the name of Marcosa agricultural lands, except by succession. Apart from being based, solely, upon a surmise,
Rivera alone, and she alone pays the real estate taxes due thereon. (Exhibits 43, 44 & 45.) without any evidentiary support, this pretense is refuted by the fact that said residential
property in Hulong-Duhat, Malabon, Rizal, was acquired on April 12, 1933, or prior to the
Further strong proofs that the properties in question are the paraphernal properties of adoption of our Constitution (see Exhibits Z and AA). Her transactions subsequently
Marcosa Rivera, are the very Torrens Titles covering said properties. All the said thereto, merely followed, therefore, the pattern of her activities before the drafting of said
properties are registered in the name of Marcosa Rivera, married to Rafael Litam. This fundamental law.
circumstance indicates that the properties in question belong to the registered owner,
Marcosa Rivera, as her paraphernal properties, for if they were conjugal, the titles covering This notwithstanding, we do not believe that Appellants should be sentenced to pay
the same should have been issued in the names of Rafael Litam and Marcosa Rivera. The damages. The petition of Gregorio Dy Tam in Special Proceeding No. 1537 and the
words married to Rafael Litam written after the name of Marcosa Rivera, in each of the complaint in Civil Case No. 2071 contain nothing derogatory to the good name or
above mentioned titles are merely descriptive of the civil status of Marcosa Rivera, the reputation of the herein Appellees. On the contrary, it may be surmised from said
registered owner of the properties covered by said titles. pleadings that Marcosa Rivera had no knowledge of the alleged previous marriage of the
decedent to Sia Khin. Moreover, the records do not show that Appellants have acted in
On the other hand, the evidence presented by the Plaintiffs in Civil Case No. 2071 bad faith.
and Petitioner in Sp. Proc. No. 1537 in support of their contention that the properties in
question are conjugal is, in the mind of the Court, very weak, unreliable, and mostly Likewise, we are of the opinion that the lower court should not have declared, in the
incompetent, and cannot overcome the clear, convincing and almost conclusive proofs decision appealed from, that Marcosa Rivera is the only heir of the decedent, for such
presented by the opposite party. Scant or no consideration at all could be given by the declaration is improper in Civil Case No. 2071, it being within the exclusive competence of
Court to the immaterial, incompetent and unbelievable testimonies of the witnesses the court in Special Proceeding No. 1537, in which it is not as yet, in issue, and, will not be,
presented by the said Plaintiffs and Petitioners. The disputable presumption of law that the ordinarily, in issue until the presentation of the project of partition.
properties acquired during the marriage are conjugal properties, upon which legal
presumption said Plaintiffs and Petitioner mainly rely has been decisively overcome by the Wherefore, with the elimination of the award for damages in favor of the herein Appellees,
overwhelming preponderance of evidence adduced in these cases that the properties in and of said declaration of heirship, the decision appealed from is hereby affirmed in all
question are the paraphernal properties of Marcosa Rivera. (Emphasis ours.) other respects, with costs against the Appellants. It is SO ORDERED.
Appellants counsel assail the decision appealed from upon the ground that the lower court
had been partial to the Appellees and had not accorded to the Appellants a fair and just
hearing.
As above pointed out, His Honor the trial Judge could have been, and should have been,
more liberal in the reception of evidence. Appellants witnesses (Li Bun Lin, Dominador
Gadi, Benigno Musni and Rafael B. Suarez) should have been allowed to testify on the
alleged title of Rafael Litam to certain properties and on his alleged reasons for the
language used in the public and official documents relied upon by the Appellees. However,
it is apparent to us that said evidence cannot affect the decision in these cases.
The evidenciary value of the testimony of said witnesses would have depended mainly
upon their individual appraisal of certain facts, upon their respective inferences therefrom
and their biases or view points, and upon a number of other factors affecting their
credibility. At best, said testimony could not possibly prevail over the repeated admissions
made by the decedent against his own interest in Exhibits 19, 21, 22, 23, 46 and 46-A
(adverted to in the abovequoted portion of the decision appealed from), which admissions
are corroborated by the fact that the deceased father of Marcosa Rivera was well to
do; chan roblesvirtualawlibrarythat aside from her share in his estate, she had, likewise,
inherited from a sister who died single and without issue; chan roblesvirtualawlibrarythat
the lands in dispute were registered, and some were, also, leased, in her name, instead of
hers and that of the decedent; chan roblesvirtualawlibraryand that the latter lived in her
house in Malabon, Rizal.
Appellants contend that the transactions covered by said Exhibits 19, 21 to 23 and 46 and
46-A, as well as by the other deeds referred to in the decision appealed from, were caused
to be made in the name of Marcosa Rivera, to the exclusion of her husband, in order to
evade the constitutional provision disqualifying foreigners from the acquisition of private
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
G.R. No. 184148 June 9, 2014 issued Transfer Certificate of Title (TCT) No. 283321 in the name of Nora B. Calalang-
Parulan. On December 27, 1989,7 Pedro Calalang died.
NORA B. CALALANG-PARULAN and ELVIRA B. CALALANG, Petitioners,
vs. The respondents assailed the validity of TCT No. 283321 on two grounds. First, the
ROSARIO CALALANG-GARCIA, LEONORA CALALANG-SABILE, and CARLITO S. respondents argued that the sale of the land was void because Pedro Calalang failed to
CALALANG, Respondents. obtain the consent of the respondents who were co-owners of the same. As compulsory
heirs upon the death of Encarnacion Silverio, the respondents claimed that they acquired
successional rights over the land. Thus, in alienating the land without their consent, Pedro
DECISION
Calalang allegedly deprived them of their pro indiviso share in the property. Second, the
respondents claimed that the sale was absolutely simulated as Nora B. Calalang-Parulan
VILLARAMA, JR., J.: did not have the capacity to pay for the consideration stated in the Deed of Sale.
Before us is a petition for review on certiorari assailing the Decision 1 dated December 21, In their Answer,8 the petitioners argued that the parcel of land was acquired during the
2007 and Resolution2dated July 25, 2008 of the Thirteenth Division of the Court of Appeals second marriage of Pedro Calalang with Elvira B. Calalang. They stressed that OCT No.
(CA) in CA-G.R. CV No. 72531. The CA modified the Decision3 dated July 10, 2001 of the P-2871 itself stated that it was issued in the name of "Pedro Calalang, married to Elvira
Regional Trial Court (RTC), Branch 21, of Malolos, Bulacan, in Civil Case No. 370-M-91. Berba [Calalang]." Thus, the property belonged to the conjugal partnership of the spouses
Pedro Calalang and Elvira B. Calalang. The petitioners likewise denied the allegation that
The facts, as culled from the records, follow: the sale of the land was absolutely simulated as Nora B. Calalang-Parulan was gainfully
employed in Spain at the time of the sale. Moreover, they alleged that the respondents did
not have a valid cause of action against them and that their cause of action, if any, was
In a Complaint4 for Annulment of Sale and Reconveyance of Property filed with the RTC of already barred by laches, estoppel and prescription. By way of counterclaim, the
Malolos, Bulacan on June 10, 1991, the respondents Rosario Calalang-Garcia, Leonora petitioners also sought the payment to them of moral and exemplary damages plus costs
Calalang-Sabile, and Carlito S. Calalang asserted their ownership over a certain parcel of of suit for the filing of the clearly unfounded suit.
land against the petitioners Nora B. Calalang-Parulan and Elvira B. Calalang. The said lot
with an area of 1,266 square meters and specifically identified as Lot 1132, Cad. 333,
Bigaa Cadastre situated in Brgy. Burol 2nd, Municipality of Balagtas, Province of Bulacan, On July 10, 2001, the trial court rendered decision in favor of the respondents. The
was allegedly acquired by the respondents from their mother Encarnacion Silverio, through dispositive portion of the RTC decision reads as follows:
succession as the latters compulsory heirs.
WHEREFORE, judgment is hereby rendered in favor of the plaintiffs and against the
According to the respondents, their father, Pedro Calalang contracted two marriages defendants in the following manner:
during his lifetime. The first marriage was with their mother Encarnacion Silverio. During
the subsistence of this marriage, their parents acquired the above-mentioned parcel of 1. Ordering the defendants to reconvey in favor of the plaintiffs, their rightful
land from their maternal grandmother Francisca Silverio. Despite enjoying continuous share to three-fourth (3/4) of one-half (1/2) or a total of 474.75 square meters at
possession of the land, however, their parents failed to register the same. On June 7, 158.25 square meters for each of the three plaintiffs, namely: Rosario, Leonora,
1942, the first marriage was dissolved with the death of Encarnacion Silverio. and Juanito all surname[d] Calalang, of the real property covered by TCT No.
283321 of the Registry of Deeds of Bulacan corresponding to their shares in the
On November 6, 1967, Pedro Calalang entered into a second marriage with Elvira B. conjugal estate of the late Encarnacion S. Calalang [sic];
Calalang who then gave birth to Nora B. Calalang-Parulan and Rolando Calalang.
According to the respondents, it was only during this time that Pedro Calalang filed an 2. Ordering defendants to pay plaintiffs the amount of 50,000.00 for moral
application for free patent over the parcel of land with the Bureau of Lands. Pedro damages; 50,000.00 for attorneys fees and another 50,000.00 for litigation
Calalang committed fraud in such application by claiming sole and exclusive ownership expenses.
over the land since 1935 and concealing the fact that he had three children with his first
spouse. As a result, on September 22, 1974, the Register of Deeds of Bulacan issued
Original Certificate of Title (OCT) No. P-28715 in favor of Pedro Calalang only. 3. Dismissing the defendants counterclaims.
On February 17, 1984, Pedro Calalang sold the said parcel of land to Nora B. Calalang- With costs against the defendants.
Parulan as evidenced by a Deed of Sale6 executed by both Pedro Calalang and Elvira B.
Calalang. Accordingly, the Register of Deeds of Bulacan cancelled OCT No. P-2871 and SO ORDERED.9
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
The trial court declared that the parcel of land was jointly acquired by the spouses Pedro The CA reversed the factual findings of the trial court and held that Pedro Calalang was
Calalang and Encarnacion Silverio from the parents of the latter. Thus, it was part of the the sole and exclusive owner of the subject parcel of land. Firstly, it held that there was
conjugal property of the first marriage of Pedro Calalang. When this marriage was insufficient evidence to prove that the disputed property was indeed jointly acquired from
dissolved upon the death of Encarnacion Silverio on June 7, 1942,the corresponding the parents of Encarnacion Silverio during the first marriage. Secondly, the CA upheld the
shares to the disputed property were acquired by the heirs of the decedent according to indefeasibility of OCT No. P-2871. It held that although the free patent was issued in the
the laws of succession. In particular, the trial court allocated half of the disputed property to name of "Pedro Calalang, married to Elvira Berba [Calalang]" this phrase was merely
Pedro Calalang as his share in the conjugal partnership and allocated the other half to the descriptive of the civil status of Pedro Calalang at the time of the registration of the
three respondents and Pedro Calalang to be divided equally among them. The trial court disputed property. Thus, contrary to the ruling of the trial court, upon the death of
then ordered all of Pedros share to be given to Nora B. Calalang-Parulan on account of Encarnacion Silverio on June 7, 1942, the respondents did not acquire any successional
the sale. The trial court also ruled that because the application for free patent filed by rights to the parcel of land which was exclusively owned by Pedro Calalang. However,
Pedro Calalang was attended by fraud and misrepresentation, Pedro Calalang should be applying the rules of succession, Pedros heirs namely, Rosario Calalang-Garcia, Leonora
considered as a trustee of an implied trust. Calalang-Sabile, Carlito Calalang, Nora B. Calalang-Parulan, Elvira B. Calalang, and
Rolando Calalang, succeeded Pedro to the land in equal shares upon his death. Thus, the
Aggrieved by the adverse ruling, the petitioners appealed the case to the CA which CA ordered the petitioners to reconvey in favor of the respondents their rightful shares to
the land. The CA ruled that the sale by Pedro Calalang to Nora B. Calalang-Parulan was
rendered the assailed Decision on December 21, 2007. The dispositive portion of the CA
decision reads, fraudulent and fictitious as the vendee was in bad faith and the respondents were
unlawfully deprived of their pro indiviso shares over the disputed property. As regards the
issue of prescription, the CA ruled that the prescriptive period for reconveyance of
WHEREFORE, in light of the foregoing premises, the Decision dated July 10, 2001of the fraudulently registered real property is ten years. Since the property was registered in the
Regional Trial Court of Malolos, Bulacan is hereby MODIFIED to read as follows: name of Nora in1984 and the action for reconveyance was filed in 1991, the action has not
yet prescribed.
"WHEREFORE, judgment is hereby rendered in favor of the plaintiffs, and against the
defendants in the following manner: On January 23, 2008, petitioners filed their Motion for Reconsideration. The CA, however,
denied their motion in its Resolution dated July 25, 2008.
1. Ordering the defendants to reconvey in favor of the plaintiffs, their rightful
share to the property owned by their common father Pedro Calalang, equivalent Hence, this petition raising the sole issue:
to one half(1/2) portion of the whole area or 633 square meters to be divided
equally by the three plaintiffs, namely:
Whether or not the court a quo gravely erred in rendering its December 21, 2007 Decision
modifying the July 10, 2001 Decision of the trial court, and in issuing its July 25, 2008
Rosario, Leonora and Carlito, all surnamed Calalang, each getting an Resolution denying petitioners Motion for Reconsideration dated January 23, 2008. 11
area of 211 square meters of the property covered by TCT No.
2883321 of the Registry of Deeds of Bulacan corresponding to their
shares in the property of their late father Pedro Calalang; Essentially, the only issue in this case is whether Pedro Calalang was the exclusive owner
of the disputed property prior to its transfer to his daughter Nora B. Calalang-Parulan.
the jurisdiction of this Court to resolve in a petition for review on certiorari. 12 However, a A plain reading of the above provision would clearly reveal that the phrase "Pedro
recognized exception to the rule is when the RTC and CA have conflicting findings of fact Calalang, married to Elvira Berba [Calalang]" merely describes the civil status and
as in this case.13 Here, while the trial court ruled that the disputed property belonged to the identifies the spouse of the registered owner Pedro Calalang. Evidently, this does not
conjugal partnership of the first marriage of Pedro Calalang with Encarnacion Silverio, the mean that the property is conjugal. In Litam v. Rivera, 15 we declared:
court a quo declared that the evidence proved the sole and exclusive ownership of the
disputed property of Pedro Calalang. Further strong proofs that the properties in question are the paraphernal properties of
Marcosa Rivera, are the very Torrens Titles covering said properties. All the said
We have carefully reviewed the records of this case and sustain the finding of the CA that properties are registered in the name of "Marcosa Rivera, married to Rafael Litam." This
Pedro Calalang is the sole and exclusive owner of the disputed property. circumstance indicates that the properties in question belong to the registered owner,
Marcosa Rivera, as her paraphernal properties, for if they were conjugal, the titles covering
The trial court ruled that the respondents were able to establish that Lot 1132, Cad. 333 the same should have been issued in the names of Rafael Litam and Marcosa Rivera. The
originated from the parents of Encarnacion, and therefore said property "either became words "married to Rafael Litam" written after the name of Marcosa Rivera, in each of the
property of Encarnacion in her own right or jointly with her husband Pedro Calalang in above mentioned titles are merely descriptive of the civil status of Marcosa Rivera, the
1936." In so ruling, the trial court relied on the testimony of Rosario Calalang-Garcia that registered owner of the properties covered by said titles.
her parents built a nipa house on the subject lot and lived there before and after World War
II. The trial court further noted that Rosarios testimony was corroborated by her cousin It must likewise be noted that in his application for free patent, 16 applicant Pedro Calalang
and adjacent neighbor Manolo Calalang.14 averred that the land was first occupied and cultivated by him since 1935 and that he had
planted mango trees, coconut plants, caimito trees, banana plants and seasonal crops and
However, as correctly pointed out by the CA, a close perusal of the records of this case built his house on the subject lot. But he applied for free patent only in 1974 and was
would show that the records are bereft of any concrete proof to show that the subject issued a free patent while already married to Elvira B. Calalang. Thus, having possessed
the subject land in the manner and for the period required by law after the dissolution of
property indeed belonged to respondents maternal grandparents. The evidence
respondents adduced merely consisted of testimonial evidence such as the declaration of the first marriage and before the second marriage, the subject property ipso jure became
private property and formed part of Pedro Calalangs exclusive property.17 It was therefore
Rosario Calalang-Garcia that they have been staying on the property as far as she can
remember and that the property was acquired by her parents through purchase from her excluded from the conjugal partnership of gains of the second marriage. 18
maternal grandparents. However, she was unable to produce any document to evidence
the said sale, nor was she able to present any documentary evidence such as the tax As the sole and exclusive owner, Pedro Calalang had the right to convey his property in
declaration issued in the name of either of her parents. Moreover, we note that the free favor of Nora B. Calalang-Parulan by executing a Deed of Sale on February 17, 1984. The
patent was issued solely in the name of Pedro Calalang and that it was issued more than CA therefore erred in ruling that Pedro Calalang deprived his heirs of their respective
30 years after the death of Encarnacion and the dissolution of the conjugal partnership of shares over the disputed property when he alienated the same.
gains of the first marriage. Thus, we cannot subscribe to respondents submission that the
subject property originally belonged to the parents of Encarnacion and was acquired by It is hornbook doctrine that successional rights are vested only at the time of death. Article
Pedro Calalang and Encarnacion. 777 of the New Civil Code provides that "[t]he rights to the succession are transmitted from
the moment of the death of the decedent." In Butte v. Manuel Uy and Sons, Inc., 19 we
We likewise cannot sustain the argument of the petitioners that the disputed property proclaimed the fundamental tenets of succession:
belongs to the conjugal partnership of the second marriage of Pedro Calalang with Elvira
B. Calalang on the ground that the title was issued in the name of "Pedro Calalang, The principle of transmission as of the time of the predecessor's death is basic in our Civil
married to Elvira Berba [Calalang]." Code, and is supported by other related articles. Thus, the capacity of the heir is
determined as of the time the decedent died (Art. 1034); the legitime is to be computed as
The contents of a certificate of title are enumerated by Section 45 of Presidential Decree of the same moment (Art. 908), and so is the in officiousness of the donation inter vivas
No. 1529, otherwise known as the Property Registration Decree: (Art. 771). Similarly, the legacies of credit and remission are valid only in the amount due
and outstanding at the death of the testator (Art. 935), and the fruits accruing after that
SEC. 45. Statement of personal circumstances in the certificate. Every certificate of title instant are deemed to pertain to the legatee (Art. 948).
shall set forth the full names of all persons whose interests make up the full ownership in
the whole land, including their civil status, and the names of their respective spouses, if Thus, it is only upon the death of Pedro Calalang on December 27, 1989 that his heirs
married, as well as their citizenship, residence and postal address. If the property covered acquired their respective inheritances, entitling them to their pro indiviso shares to his
belongs to the conjugal partnership, it shall be issued in the names of both whole estate. At the time of the sale of the disputed property, the rights to the succession
spouses.1wphi1 were not yet bestowed upon the heirs of Pedro Calalang. And absent clear and convincing
evidence that the sale was fraudulent or not duly supported by valuable consideration (in
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
effect an in officious donation inter vivas), the respondents have no right to question the G.R. No. 159310 February 24, 2009
sale of the disputed property on the ground that their father deprived them of their
respective shares. Well to remember, fraud must be established by clear and convincing CAMILO F. BORROMEO, Petitioner,
evidence. Mere preponderance of evidence is not even adequate to prove fraud. 20 The
vs.
Complaint for Annulment of Sale and Reconveyance of Property must therefore be ANTONIETTA O. DESCALLAR, Respondent.
dismissed.
DECISION
WHEREFORE, the petition for review on certiorari is GRANTED. The Decision dated
December 21, 2007 and Resolution dated July 25, 2008 of the Thirteenth Division of the
Court of Appeals in CA-G.R. CV No. 72531 are REVERSED and SET ASIDE. Civil Case PUNO, C.J.:
No. 370-M-91, or the Complaint for Annulment of Sale and Reconveyance of Property filed
by the respondents with the Regional Trial Court, Branch 21 of Malolos, Bulacan, on June What are the rights of an alien (and his successor-in-interest) who acquired real properties
10, 1991, is hereby DISMISSED for lack of merit. in the country as against his former Filipina girlfriend in whose sole name the properties
were registered under the Torrens system?
No pronouncement as to costs.
The facts are as follows:
SO ORDERED.
Wilhelm Jambrich, an Austrian, arrived in the Philippines in 1983 after he was assigned by
his employer, Simmering-Graz Panker A.G., an Austrian company, to work at a project in
Mindoro. In 1984, he transferred to Cebu and worked at the Naga II Project of the National
Power Corporation. There, he met respondent Antonietta Opalla-Descallar, a separated
mother of two boys who was working as a waitress at St. Moritz Hotel. Jambrich
befriended respondent and asked her to tutor him in English. In dire need of additional
income to support her children, respondent agreed. The tutorials were held in Antoniettas
residence at a squatters area in Gorordo Avenue.
Jambrich and respondent fell in love and decided to live together in a rented house in
Hernan Cortes, Mandaue City. Later, they transferred to their own house and lots at Agro-
Macro Subdivision, Cabancalan, Mandaue City. In the Contracts to Sell dated November
18, 19851 and March 10, 19862 covering the properties, Jambrich and respondent were
referred to as the buyers. A Deed of Absolute Sale dated November 16, 1987 3 was
likewise issued in their favor. However, when the Deed of Absolute Sale was presented for
registration before the Register of Deeds, registration was refused on the ground that
Jambrich was an alien and could not acquire alienable lands of the public domain.
Consequently, Jambrichs name was erased from the document. But it could be noted that
his signature remained on the left hand margin of page 1, beside respondents signature
as buyer on page 3, and at the bottom of page 4 which is the last page. Transfer
Certificate of Title (TCT) Nos. 24790, 24791 and 24792 over the properties were issued in
respondents name alone.
Jambrich also formally adopted respondents two sons in Sp. Proc. No. 39-MAN,4 and per
Decision of the Regional Trial Court of Mandaue City dated May 5, 1988. 5
However, the idyll lasted only until April 1991. By then, respondent found a new boyfriend
while Jambrich began to live with another woman in Danao City. Jambrich supported
respondents sons for only two months after the break up.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Jambrich met petitioner Camilo F. Borromeo sometime in 1986. Petitioner was engaged in In fact, this miserable financial situation of hers and her two children . . . are all stated and
the real estate business. He also built and repaired speedboats as a hobby. In 1989, reflected in the Child Study Report dated April 20, 1983 (Exhs. "G" and "G-1") which facts
Jambrich purchased an engine and some accessories for his boat from petitioner, for she supplied to the Social Worker who prepared the same when she was personally
which he became indebted to the latter for about 150,000.00. To pay for his debt, he sold interviewed by her in connection with the adoption of her two children by Wilhelm
his rights and interests in the Agro-Macro properties to petitioner for 250,000, as Jambrich. So that, if such facts were not true because these are now denied by her . . .
evidenced by a "Deed of Absolute Sale/Assignment." 6 On July 26, 1991, when petitioner and if it was also true that during this time she was already earning as much as 8,000.00
sought to register the deed of assignment, he discovered that titles to the three lots have to 9,000.00 as profit per month from her copra business, it would be highly unbelievable
been transferred in the name of respondent, and that the subject property has already and impossible for her to be living only in such a miserable condition since it is the
been mortgaged. observation of this Court that she is not only an extravagant but also an expensive person
and not thrifty as she wanted to impress this Court in order to have a big saving as clearly
On August 2, 1991, petitioner filed a complaint against respondent for recovery of real shown by her actuation when she was already cohabiting and living with Jambrich that
property before the Regional Trial Court of Mandaue City. Petitioner alleged that the according to her . . . the allowance given . . . by him in the amount of $500.00 a month is
not enough to maintain the education and maintenance of her children. 8
Contracts to Sell dated November 18, 1985 and March 10, 1986 and the Deed of Absolute
Sale dated November 16, 1987 over the properties which identified both Jambrich and
respondent as buyers do not reflect the true agreement of the parties since respondent did This being the case, it is highly improbable and impossible that she could acquire the
not pay a single centavo of the purchase price and was not in fact a buyer; that it was properties under litigation or could contribute any amount for their acquisition which
Jambrich alone who paid for the properties using his exclusive funds; that Jambrich was according to her is worth more than 700,000.00 when while she was working as [a]
the real and absolute owner of the properties; and, that petitioner acquired absolute waitress at St. Moritz Hotel earning 1,000.00 a month as salary and tips of more or less
ownership by virtue of the Deed of Absolute Sale/Assignment dated July 11, 1991 which 2,000.00 she could not even provide [for] the daily needs of her family so much so that it
Jambrich executed in his favor. is safe to conclude that she was really in financial distress when she met and accepted the
offer of Jambrich to come and live with him because that was a big financial opportunity for
In her Answer, respondent belied the allegation that she did not pay a single centavo of the her and her children who were already abandoned by her husband. 9
purchase price. On the contrary, she claimed that she "solely and exclusively used her
own personal funds to defray and pay for the purchase price of the subject lots in xxx
question," and that Jambrich, being an alien, was prohibited to acquire or own real
property in the Philippines. The only probable and possible reason why her name appeared and was included in [the
contracts to sell dated November 18, 1985 and March 10, 1986 and finally, the deed of
At the trial, respondent presented evidence showing her alleged financial capacity to buy absolute sale dated November 16, 1987] as buyer is because as observed by the Court,
the disputed property with money from a supposed copra business. Petitioner, in turn, she being a scheming and exploitive woman, she has taken advantage of the goodness of
presented Jambrich as his witness and documentary evidence showing the substantial Jambrich who at that time was still bewitched by her beauty, sweetness, and good attitude
salaries which Jambrich received while still employed by the Austrian company, shown by her to him since he could still very well provide for everything she needs, he
Simmering-Graz Panker A.G. being earning (sic) much yet at that time. In fact, as observed by this Court, the acquisition
of these properties under litigation was at the time when their relationship was still going
In its decision, the court a quo found smoothly and harmoniously.10 [Emphasis supplied.]
Evidence on hand clearly show that at the time of the purchase and acquisition of [the] The dispositive portion of the Decision states:
properties under litigation that Wilhelm Jambrich was still working and earning much. This
fact of Jambrich earning much is not only supported by documentary evidence but also by WHEREFORE, . . . Decision is hereby rendered in favor of the plaintiff and against the
the admission made by the defendant Antoniet[t]a Opalla. So that, Jambrichs financial defendant Antoniet[t]a Opalla by:
capacity to acquire and purchase the properties . . . is not disputed.7
1) Declaring plaintiff as the owner in fee simple over the residential house of
xxx strong materials and three parcels of land designated as Lot Nos. 1, 3 and 5
which are covered by TCT Nos. 24790, 24791 and 24792 issued by the Register
On the other hand, evidence . . . clearly show that before defendant met Jambrich of Deeds of Mandaue City;
sometime in the latter part of 1984, she was only working as a waitress at the St. Moritz
Hotel with an income of 1,000.00 a month and was . . . renting and living only in . . . [a] 2) Declaring as null and void TCT Nos. 24790, 24791 and 24792 issued in the
room at . . . [a] squatter area at Gorordo Ave., Cebu City; that Jambrich took pity of her name of defendant Antoniet[t]a Descallar by the Register of Deeds of Mandaue
and the situation of her children that he offered her a better life which she readily accepted. City;
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
3) Ordering the Register of Deeds of Mandaue City to cancel TCT Nos. 24790, III. THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED IN REVERSING THE
24791 and 24792 in the name of defendant Antoniet[t]a Descallar and to issue WELL-REASONED DECISION OF THE TRIAL COURT AND IN IMPOSING DOUBLE
new ones in the name of plaintiff Camilo F. Borromeo; COSTS AGAINST HEREIN PETITIONER (THEN, PLAINTIFF-APPELLEE).14
4) Declaring the contracts now marked as Exhibits "I," "K" and "L" as avoided First, who purchased the subject properties?
insofar as they appear to convey rights and interests over the properties in
question to the defendant Antoniet[t]a Descallar; The evidence clearly shows, as pointed out by the trial court, who between respondent and
Jambrich possesses the financial capacity to acquire the properties in dispute. At the time
5) Ordering the defendant to pay plaintiff attorneys fees in the amount of of the acquisition of the properties in 1985 to 1986, Jambrich was gainfully employed at
25,000.00 and litigation expenses in the amount of 10,000.00; and, Simmering-Graz Panker A.G., an Austrian company. He was earning an estimated
monthly salary of 50,000.00. Then, Jambrich was assigned to Syria for almost one year
where his monthly salary was approximately 90,000.00.
6) To pay the costs.11
Respondent appealed to the Court of Appeals. In a Decision dated April 10, 2002, 12 the On the other hand, respondent was employed as a waitress from 1984 to 1985 with a
appellate court reversed the decision of the trial court. In ruling for the respondent, the monthly salary of not more than 1,000.00. In 1986, when the parcels of land were
acquired, she was unemployed, as admitted by her during the pre-trial conference. Her
Court of Appeals held:
allegations of income from a copra business were unsubstantiated. The supposed copra
business was actually the business of her mother and their family, with ten siblings. She
We disagree with the lower courts conclusion. The circumstances involved in the case has no license to sell copra, and had not filed any income tax return. All the motorized
cited by the lower court and similar cases decided on by the Supreme Court which upheld bancas of her mother were lost to fire, and the last one left standing was already scrap.
the validity of the title of the subsequent Filipino purchasers are absent in the case at bar. Further, the Child Study Report15 submitted by the Department of Social Welfare and
It should be noted that in said cases, the title to the subject property has been issued in the Development (DSWD) in the adoption proceedings of respondents two sons by Jambrich
name of the alien transferee (Godinez et al., vs. Fong Pak Luen et al., 120 SCRA 223 disclosed that:
citing Krivenko vs. Register of Deeds of Manila, 79 Phils. 461; United Church Board for
World Ministries vs. Sebastian, 159 SCRA 446, citing the case of Sarsosa Vda. De
Barsobia vs. Cuenco, 113 SCRA 547; Tejido vs. Zamacoma, 138 SCRA 78). In the case at Antonietta tried all types of job to support the children until she was accepted as a waitress
bar, the title of the subject property is not in the name of Jambrich but in the name of at St. Moritz Restaurant in 1984. At first she had no problem with money because most of
defendant-appellant. Thus, Jambrich could not have transferred a property he has no title the customers of St. Moritz are (sic) foreigners and they gave good tips but towards the
thereto.13 end of 1984 there were no more foreigners coming because of the situation in the
Philippines at that time. Her financial problem started then. She was even renting a small
room in a squatters area in Gorordo Ave., Cebu City. It was during her time of great
Petitioners motion for reconsideration was denied. financial distress that she met Wilhelm Jambrich who later offered her a decent place for
herself and her children.16
Hence, this petition for review.
The DSWD Home Study Report17 further disclosed that:
Petitioner assigns the following errors:
[Jambrich] was then at the Restaurant of St. Moritz when he saw Antonietta Descallar, one
I. THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED IN DISREGARDING of the waitresses of the said Restaurants. He made friends with the girl and asked her to
RESPONDENTS JUDICIAL ADMISSION AND OTHER OVERWHELMING EVIDENCE tutor him in [the] English language. Antonietta accepted the offer because she was in need
ESTABLISHING JAMBRICHS PARTICIPATION, INTEREST AND OWNERSHIP OF THE of additional income to support [her] 2 young children who were abandoned by their father.
PROPERTIES IN QUESTION AS FOUND BY THE HONORABLE TRIAL COURT. Their session was agreed to be scheduled every afternoon at the residence of Antonietta
in the squatters area in Gorordo Avenue, Cebu City. The Austrian was observing the
situation of the family particularly the children who were malnourished. After a few months
II. THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED IN HOLDING THAT sessions, Mr. Jambrich offered to transfer the family into a decent place. He told Antonietta
JAMBRICH HAS NO TITLE TO THE PROPERTIES IN QUESTION AND MAY NOT that the place is not good for the children. Antonietta who was miserable and financially
THEREFORE TRANSFER AND ASSIGN ANY RIGHTS AND INTERESTS IN FAVOR OF distressed at that time accepted the offer for the sake of the children. 18
PETITIONER.
Further, the following additional pieces of evidence point to Jambrich as the source of fund
used to purchase the three parcels of land, and to construct the house thereon:
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
(1) Respondent Descallar herself affirmed under oath, during her re-direct implies that the title is quiet,23and that it is perfect, absolute and indefeasible.24 However,
examination and during the proceedings for the adoption of her minor children, there are well-defined exceptions to this rule, as when the transferee is not a holder in
that Jambrich was the owner of the properties in question, but that his name was good faith and did not acquire the subject properties for a valuable consideration.25 This is
deleted in the Deed of Absolute Sale because of legal constraints. Nonetheless, the situation in the instant case. Respondent did not contribute a single centavo in the
his signature remained in the deed of sale, where he signed as buyer. acquisition of the properties. She had no income of her own at that time, nor did she have
any savings. She and her two sons were then fully supported by Jambrich.
(2) The money used to pay the subject parcels of land in installments was in
postdated checks issued by Jambrich. Respondent has never opened any Respondent argued that aliens are prohibited from acquiring private land. This is embodied
account with any bank. Receipts of the installment payments were also in the in Section 7, Article XII of the 1987 Constitution,26 which is basically a reproduction of
name of Jambrich and respondent. Section 5, Article XIII of the 1935 Constitution, 27 and Section 14, Article XIV of the 1973
Constitution.28 The capacity to acquire private land is dependent on the capacity "to
(3) In 1986-1987, respondent lived in Syria with Jambrich and her two children acquire or hold lands of the public domain." Private land may be transferred only to
for ten months, where she was completely under the support of Jambrich. individuals or entities "qualified to acquire or hold lands of the public domain." Only Filipino
citizens or corporations at least 60% of the capital of which is owned by Filipinos are
qualified to acquire or hold lands of the public domain. Thus, as the rule now stands, the
(4) Jambrich executed a Last Will and Testament, where he, as owner, fundamental law explicitly prohibits non-Filipinos from acquiring or holding title to private
bequeathed the subject properties to respondent. lands, except only by way of legal succession or if the acquisition was made by a former
natural-born citizen.29
Thus, Jambrich has all authority to transfer all his rights, interests and participation over
the subject properties to petitioner by virtue of the Deed of Assignment he executed on Therefore, in the instant case, the transfer of land from Agro-Macro Development
July 11, 1991. Corporation to Jambrich, who is an Austrian, would have been declared invalid if
challenged, had not Jambrich conveyed the properties to petitioner who is a Filipino
Well-settled is the rule that this Court is not a trier of facts. The findings of fact of the trial citizen. In United Church Board for World Ministries v. Sebastian, 30 the Court reiterated the
court are accorded great weight and respect, if not finality by this Court, subject to a consistent ruling in a number of cases31 that if land is invalidly transferred to an alien who
number of exceptions. In the instant case, we find no reason to disturb the factual findings subsequently becomes a Filipino citizen or transfers it to a Filipino, the flaw in the original
of the trial court. Even the appellate court did not controvert the factual findings of the trial transaction is considered cured and the title of the transferee is rendered valid. Applying
court. They differed only in their conclusions of law. United Church Board for World Ministries, the trial court ruled in favor of petitioner, viz.:
Further, the fact that the disputed properties were acquired during the couples [W]hile the acquisition and the purchase of (sic) Wilhelm Jambrich of the properties under
cohabitation also does not help respondent. The rule that co-ownership applies to a man litigation [were] void ab initio since [they were] contrary to the Constitution of the
and a woman living exclusively with each other as husband and wife without the benefit of Philippines, he being a foreigner, yet, the acquisition of these properties by plaintiff who is
marriage, but are otherwise capacitated to marry each other, does not apply. 19 In the a Filipino citizen from him, has cured the flaw in the original transaction and the title of the
instant case, respondent was still legally married to another when she and Jambrich lived transferee is valid.
together. In such an adulterous relationship, no co-ownership exists between the parties. It
is necessary for each of the partners to prove his or her actual contribution to the The trial court upheld the sale by Jambrich in favor of petitioner and ordered the
acquisition of property in order to be able to lay claim to any portion of it. Presumptions of cancellation of the TCTs in the name of respondent. It declared petitioner as owner in fee
co-ownership and equal contribution do not apply. 20 simple of the residential house of strong materials and three parcels of land designated as
Lot Nos. 1, 3 and 5, and ordered the Register of Deeds of Mandaue City to issue new
Second, we dispose of the issue of registration of the properties in the name of respondent certificates of title in his name. The trial court likewise ordered respondent to pay petitioner
alone. Having found that the true buyer of the disputed house and lots was the Austrian 25,000 as attorneys fees and 10,000 as litigation expenses, as well as the costs of suit.
Wilhelm Jambrich, what now is the effect of registration of the properties in the name of
respondent? We affirm the Regional Trial Court.
It is settled that registration is not a mode of acquiring ownership. 21 It is only a means of The rationale behind the Courts ruling in United Church Board for World Ministries, as
confirming the fact of its existence with notice to the world at large. 22 Certificates of title are reiterated in subsequent cases,32 is this since the ban on aliens is intended to preserve
not a source of right. The mere possession of a title does not make one the true owner of the nations land for future generations of Filipinos, that aim is achieved by making lawful
the property. Thus, the mere fact that respondent has the titles of the disputed properties the acquisition of real estate by aliens who became Filipino citizens by naturalization or
in her name does not necessarily, conclusively and absolutely make her the owner. The those transfers made by aliens to Filipino citizens. As the property in dispute is already in
rule on indefeasibility of title likewise does not apply to respondent. A certificate of title
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Land Titles and Deeds (Finals) 2017
the hands of a qualified person, a Filipino citizen, there would be no more public policy to G.R. No. 202932 October 23, 2013
be protected. The objective of the constitutional provision to keep our lands in Filipino
hands has been achieved. EDILBERTO U. VENTURA JR., Petitioner,
vs.
IN VIEW WHEREOF, the petition is GRANTED. The Decision of the Court of Appeals in SPOUSES PAULINO and EVANGELINE ABUDA, Respondents.
C.A. G.R. CV No. 42929 dated April 10, 2002 and its Resolution dated July 8, 2003 are
REVERSED and SET ASIDE. The Decision of the Regional Trial Court of Mandaue City in CARPIO, J.:
Civil Case No. MAN-1148 is REINSTATED.
The Case
SO ORDERED.
This petition for review on certiorari seeks to annul the Decision1 dated 9 March 2012 of
the Court of Appeals (CA) in CA-G.R. CV No. 92330 and the Resolution2 dated 3 August
2012 denying the motion for reconsideration. The Decision and Resolution dismissed the
Appeal dated 23 October 2009 and affirmed with modification the Decision 3 dated 24
November 2008 of the Regional Trial Court of Manila, Branch 32 (RTC-Manila).
The Facts
Socorro Torres (Socorro) and Esteban Abletes (Esteban) were married on 9 June 1980.
Although Socorro and Esteban never had common children, both of them had children
from prior marriages: Esteban had a daughter named Evangeline Abuda (Evangeline), and
Socorro had a son, who was the father of Edilberto U. Ventura, Jr. (Edilberto), the
petitioner in this case.
Evidence shows that Socorro had a prior subsisting marriage to Crispin Roxas (Crispin)
when she married Esteban. Socorro married Crispin on 18 April 1952. This marriage was
not annulled, and Crispin was alive at the time of Socorros marriage to Esteban.
Estebans prior marriage, on the other hand, was dissolved by virtue of his wifes death in
1960. According to Edilberto, sometime in 1968, Esteban purchased a portion of a lot
situated at 2492 State Alley, Bonifacio Street, Vitas, Tondo, Manila (Vitas property). The
remaining portion was thereafter purchased by Evangeline on her fathers behalf sometime
in 1970.4 The Vitas property was covered by Transfer Certificate of Title No. 141782, dated
11 December 1980, issued to "Esteban Abletes, of legal age, Filipino, married to Socorro
Torres."5
Edilberto also claimed that starting 1978, Evangeline and Esteban operated small
business establishments located at 903 and 905 Delpan Street, Tondo, Manila (Delpan
property).6
On 6 September 1997, Esteban sold the Vitas and Delpan properties to Evangeline and
her husband, Paulino Abuda (Paulino).7 According to Edilberto:
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Land Titles and Deeds (Finals) 2017
when Esteban was diagnosed with colon cancer sometime in 1993, he decided to sell the Jurisprudence under the Civil Code states that no judicial decree is necessary in order to
Delpan and Vitas properties to Evangeline. Evangeline continued paying the amortizations establish the nullity of a marriage. x x x
on the two (2) properties situated in Delpan Street. The amortizations, together with the
amount of Two Hundred Thousand Pesos (Php 200,000.00), which Esteban requested as
Under ordinary circumstances, the effect of a void marriage, so far as concerns the
advance payment, were considered part of the purchase price of the Delpan properties. conferring of legal rights upon the parties, is as though no marriage had ever taken place.
Evangeline likewise gave her father Fifty Thousand Pesos (Php 50,000.00) for the And therefore, being good for no legal purpose, its invalidity can be maintained in any
purchase of the Vitas properties and she shouldered his medical expenses. 8 proceeding in which [the] fact of marriage may be material, either direct or collateral, in any
civil court between any parties at any time, whether before or after the death of either or
Esteban passed away on 11 September 1997, while Socorro passed away on 31 July both the husband and the wife, and upon mere proof of the facts rendering such marriage
1999. void, it will be disregarded or treated as non-existent by the courts.13
Sometime in 2000, Leonora Urquila (Leonora), the mother of Edilberto, discovered the According to the RTC-Manila, the Vitas and Delpan properties are not conjugal, and are
sale. Thus, Edilberto, represented by Leonora, filed a Petition for Annulment of Deeds of governed by Articles 144 and 485 of the Civil Code, to wit:
Sale before the RTC-Manila. Edilberto alleged that the sale of the properties was
fraudulent because Estebans signature on the deeds of sale was forged. Respondents, on Art. 144. When a man and a woman live together as husband and wife, but they are not
the other hand, argued that because of Socorros prior marriage to Crispin, her subsequent married, or their marriage is void from the beginning, the property acquired by either or
marriage to Esteban was null and void. Thus, neither Socorro nor her heirs can claim any both of them through their work or industry or their wages and salaries shall be governed
right or interest over the properties purchased by Esteban and respondents. 9 by the rules on co-ownership.
The Ruling of the RTC-Manila Art. 485. The share of the co-owners, in the benefits as well as in the charges, shall be
proportional to their respective interests. Any stipulation in a contract to the contrary shall
The RTC-Manila dismissed the petition for lack of merit. be void.
The RTC-Manila ruled that the marriage between Socorro and Esteban was void from the The portions belonging to the co-owners in the co-ownership shall be presumed equal,
beginning.10 Article 83 of the Civil Code, which was the governing law at the time Esteban unless the contrary is proved.
and Socorro were married, provides:
The RTC-Manila then determined the respective shares of Socorro and Esteban in the
Art. 83. Any marriage subsequently contracted by any person during the lifetime of the first properties. It found that:
spouse of such person shall be illegal and void from its performance unless:
with respect to the property located at 2492 State Alley, Bonifacio St. Vitas, Tondo, Manila
1. The first marriage was annulled or dissolved; or covered by TCT No. 141782, formerly Marcos Road, Magsaysay Village, Tondo, Manila,
[Evangeline] declared that part of it was first acquired by her father Esteban Abletes
2. The first spouse had been absent for seven consecutive years at the time of sometime in 1968 when he purchased the right of Ampiano Caballegan. Then, in 1970,
she x x x bought the right to one-half of the remaining property occupied by Ampiano
the second marriage without the spouse present having news of the absentee
being alive, or if the absentee, though he has been absent for less than seven Caballegan. However, during the survey of the National Housing Authority, she allowed the
whole lot to be registered in her fathers name. As proof thereof, she presented Exhibits "8"
years, is generally considered as dead and believed to be so by the spouse
present at the time of contracting such subsequent marriage, or if the absentee is to "11" x x x. These documents prove that that she has been an occupant of the said
presumed dead according to articles 390 and 391. The marriage so contracted property in Vitas, Tondo even before her father and Socorro Torres got married in June,
shall be valid in any of the three cases until declared null and void. 1980.14
During trial, Edilberto offered the testimony of Socorros daughter-in-law Conchita Ventura Anent the parcels of land and improvements thereon 903 and 905 Del Pan Street, Tondo,
(Conchita). In her first affidavit, Conchita claimed that Crispin, who was a seaman, had Manila, x x x Evangeline professed that in 1978, before her father met Socorro Torres and
been missing and unheard from for 35 years. However, Conchita recanted her earlier before the construction of the BLISS Project thereat, her father [already had] a bodega of
testimony and executed an Affidavit of Retraction. 11 canvas (lona) and a sewing machine to sew the canvas being sold at 903 Del Pan Street,
Tondo Manila. In 1978, she was also operating Vangies Canvas Store at 905 Del Pan
Street, Tondo, Manila, which was evidenced by Certificate of Registration of Business
The RTC-Manila ruled that the lack of a judicial decree of nullity does not affect the status Name issued in her favor on 09 November 1998 x x x. When the BLISS project was
of the union. It applied our ruling in Nial v. Badayog: 12 constructed in 1980, the property became known as Units D-9 and D-10. At first, her father
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
[paid] for the amortizations for these two (2) parcels of land but when he got sick with colon Hence, this petition.
cancer in 1993, he asked respondents to continue paying for the amortizations x x x.
[Evangeline] paid a total of 195,259.52 for Unit D-9 as shown by the 37 pieces of receipts The Ruling of this Court
x x x and the aggregate amount of 188,596.09 for Unit D-10, as evidenced by 36 receipts
x x x.15
We deny the petition.
The RTC-Manila concluded that Socorro did not contribute any funds for the acquisition of
the properties. Hence, she cannot be considered a co-owner, and her heirs cannot claim Edilberto admitted that in unions between a man and a woman who are incapacitated to
any rights over the Vitas and Delpan properties. 16 marry each other, the ownership over the properties acquired during the subsistence of
that relationship shall be based on the actual contribution of the parties. He even quoted
our ruling in Borromeo v. Descallar24 in his petition:
Aggrieved, Edilberto filed an appeal before the CA.
It is necessary for each of the partners to prove his or her actual contribution to the
The Ruling of the CA acquisition of property in order to be able to lay claim to any portion of it. Presumptions of
co-ownership and equal contribution do not apply. 25
In its Decision17 dated 9 March 2012, the CA sustained the decision of the RTC-Manila.
The dispositive portion of the CA Decision reads: This is a reiteration of Article 148 of the Family Code, which the CA applied in the assailed
decision:
WHEREFORE, the Appeal is hereby DENIED and the challenged Decision of the court a
quo STANDS. SO ORDERED.18 Art 148. In cases of cohabitation [wherein the parties are incapacitated to marry each
other], only the properties acquired by both of the parties through their actual joint
The CA ruled, however, that the RTC-Manila should have applied Article 148 of the Family contribution of money, property, or industry shall be owned by them in common in
Code, and not Articles 144 and 485 of the Civil Code. Article 148 of the Family Code states proportion to their respective contributions. In the absence of proof to the contrary, their
that in unions between a man and a woman who are incapacitated to marry each other: contributions and corresponding shares are presumed to be equal. The same rule and
presumption shall apply to joint deposits of money and evidences of credit.
x x x only the properties acquired by both of the parties through their actual joint
contribution of money, property, or industry shall be owned by them in common in If one of the parties is validly married to another, his or her share in the co-ownership shall
proportion to their respective contributions. In the absence of proof to the contrary, their accrue to the absolute community or conjugal partnership existing in such valid marriage. If
contributions and corresponding shares are presumed to be equal. The same rule and the party who acted in bad faith is not validly married to another, his or her share shall be
presumption shall apply to joint deposits of money and evidences of credit. forfeited in the manner provided in the last paragraph of the preceding Article.
If one of the parties is validly married to another, his or her share in the co-ownership shall The foregoing rules on forfeiture shall likewise apply even if both parties are in bad faith.
accrue to the absolute community or conjugal partnership existing in such valid marriage. If
the party who acted in bad faith is not validly married to another, his or her share shall be Applying the foregoing provision, the Vitas and Delpan properties can be considered
forfeited in the manner provided in the last paragraph of the preceding Article. common property if: (1) these were acquired during the cohabitation of Esteban and
Socorro; and (2) there is evidence that the properties were acquired through the parties
The foregoing rules on forfeiture shall likewise apply even if both parties are in bad faith. actual joint contribution of money, property, or industry.
The CA applied our ruling in Saguid v. Court of Appeals, 19 and held that the foregoing Edilberto argues that the certificate of title covering the Vitas property shows that the
provision applies "even if the cohabitation or the acquisition of the property occurred before parcel of land is co-owned by Esteban and Socorro because: (1) the Transfer Certificate of
the effectivity of the Family Code."20 The CA found that Edilberto failed to prove that Title was issued on 11 December 1980, or several months after the parties were married;
Socorro contributed to the purchase of the Vitas and Delpan properties. Edilberto was and (2) title to the land was issued to "Esteban Abletes, of legal age, married to Socorro
unable to provide any documentation evidencing Socorros alleged contribution. 21 Torres."26
On 2 April 2012, Edilberto filed a Motion for Reconsideration, 22 which was denied by the We disagree. The title itself shows that the Vitas property is owned by Esteban
CA in its Resolution dated 3 August 2012.23 alone.1wphi1 The phrase "married to Socorro Torres" is merely descriptive of his civil
status, and does not show that Socorro co-owned the property. 27The evidence on record
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Land Titles and Deeds (Finals) 2017
also shows that Esteban acquired ownership over the Vitas property prior to his marriage G.R. No. 198356, April 20, 2015
to Socorro, even if the certificate of title was issued after the celebration of the marriage.
Registration under the Torrens title system merely confirms, and does not vest title. This ESPERANZA SUPAPO AND THE HEIRS OF ROMEO SUPAPO, NAMELY:
was admitted by Edilberto on page 9 of his petition wherein he quotes an excerpt of our
ESPERANZA, REX EDWARD, RONALD TROY, ROMEO, JR., SHEILA LORENCE, ALL
ruling in Borromeo: SURNAMED SUPAPO, AND SHERYL FORTUNE SUPAPO-
SANDIGAN, Petitioners, v. SPOUSES ROBERTO AND SUSAN DE JESUS, MACARIO
Registration is not a mode of acquiring ownership. It is only a means of confirming the fact BERNARDO, AND THOSE PERSONS CLAIMING RIGHTS UNDER THEM, Respondent.
of its existence with notice to the world at large. Certificates of title are not a source of
right. The mere possession of a title does not make one the true owner of the property. DECISION
Thus, the mere fact that respondent has the titles of the disputed properties in her name
does not necessarily, conclusively and absolutely make her the owner. The rule on
indefeasibility of title likewise does not apply to respondent. A certificate of title implies that BRION, J.:
the title is quiet, and that it is perfect, absolute and indefeasible. However, there are well-
defined exceptions to this rule, as when the transferee is not a holder in good faith and did We resolve the petition for review on certiorari1 filed by petitioners Esperanza Supapo and
not acquire the subject properties for a valuable consideration. Romeo Supapo2 (Spouses Supapo) to assail the February 25, 2011 decision3 and August
25, 2011 resolution4 of the Court of Appeals (CA) in CA-G.R. SP No. 111674.
Edilberto claims that Esteban s actual contribution to the purchase of the Delpan property
was not sufficiently proven since Evangeline shouldered some of the Factual Antecedents
amortizations.28 Thus, the law presumes that Esteban and Socorro jointly contributed to
the acquisition of the Del pan property. The Spouses Supapo filed a complaint5 for accion publiciana against Roberto and Susan
de Jesus (Spouses de Jesus), Macario Bernardo (Macario), and persons claiming rights
We cannot sustain Edilberto s claim. Both the RTC-Manila and the CA found that the under them (collectively, the respondents), with the Metropolitan Trial Court (MeTC) of
Delpan property was acquired prior to the marriage of Esteban and Caloocan City.
Socorro.29 Furthermore, even if payment of the purchase price of the Delpan property was
made by Evangeline, such payment was made on behalf of her father. Article 1238 of the The complaint sought to compel the respondents to vacate a piece of land located in
Civil Code provides: Novaliches, Quezon City, described as Lot 40, Block 5 (subject lot). The subject lot is
covered by Transfer Certificate of Title (TCT) No. C-284416 registered and titled under the
Spouses Supapo's names. The land has an assessed value of thirty-nine thousand nine
Art. 1238. Payment made by a third person who does not intend to be reimbursed by the hundred eighty pesos (39,980.00) as shown in the Declaration of Real Property Value (tax
debtor is deemed to be a donation, which requires the debtor s consent. But the payment declaration) issued by the Office of the City Assessor of Caloocan. 7
is in any case valid as to the creditor who has accepted it.
The Spouses Supapo did not reside on the subject lot. They also did not employ an
Thus, it is clear that Evangeline paid on behalf of her father, and the parties intended that overseer but they made sure to visit at least twice a year. 8 During one of their visits in
the Delpan property would be owned by and registered under the name of Esteban. 1992, they saw two (2) houses built on the subject lot. The houses were built without their
knowledge and permission. They later learned that the Spouses de Jesus occupied one
house while Macario occupied the other one. 9
During trial, the Abuda spouses presented receipts evidencing payments of the
amortizations for the Delpan property.1wphi1 On the other hand, Edilberto failed to show The Spouses Supapo demanded from the respondents the immediate surrender of the
any evidence showing Socorro s alleged monetary contributions. As correctly pointed out subject lot by bringing the dispute before the appropriate Lupong Tagapamayapa.
by the CA: The Lupon issued a Katibayan Upang Makadulog sa Hukuman (certificate to file action) for
failure of the parties to settle amicably. 10
settled is the rule that in civil cases x x x the burden of proof rests upon the party who, as
determined by the pleadings or the nature of the case, asserts the affirmative of an issue. x The Spouses Supapo then filed a criminal case11 against the respondents for violation of
x x. Here it is Appellant who is duty bound to prove the allegations in the complaint which Presidential Decree No. 772 or the Anti-Squatting Law.12 The trial court convicted the
undoubtedly, he miserably failed to do so. 30 respondents. The dispositive portion of the decision reads:
WHEREFORE, the petition is DENIED. The Decision dated 9 March 2012 of the Court of WHEREFORE, in view of all the foregoing, this Court finds accused ROBERTO DE
Appeals in CA-G.R. CV No. 92330 is AFFIRMED. SO ORDERED. JESUS, SUSAN DE JESUS and MACARIO BERNARDO, GUILTY beyond reasonable
doubt for Violation of Presidential Decree No. 772, and each accused is hereby ordered to
pay a fine of ONE THOUSAND PESOS (P1,000.00), and to vacate the subject
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Land Titles and Deeds (Finals) 2017
SO ORDERED.13 (Emphasis supplied.) The RTC granted the petition for certiorari on two grounds, viz.: (i) the action has
prescribed; and (ii) accion publiciana falls within the exclusive jurisdiction of the RTC.
The respondents appealed their conviction to the CA. 14 While the appeal was pending,
Congress enacted Republic Act (RA) No. 8368, otherwise known as "An Act Repealing It held that in cases where the only issue involved is possession, the MeTC has jurisdiction
Presidential Decree No. 772," which resulted to the dismissal of the criminal case. 15 if the action for forcible entry or unlawful detainer is filed within one (1) year from the time
to demand to vacate was made. Otherwise, the complaint for recovery of possession
On April 30, 1999, the CA's dismissal of the criminal case became final. 16 should be filed before the RTC.
Notwithstanding the dismissal, the Spouses Supapo moved for the execution of the The dispositive portion of the RTC decision reads:
respondents' civil liability, praying that the latter vacate the subject lot. The Regional Trial
Court (RTC) granted the motion and issued the writ of execution. The respondents moved WHEREFORE, premises considered, the instant petition is hereby GRANTED.
for the quashal of the writ but the RTC denied the same. The RTC also denied the
respondents' motion for reconsideration. The Orders dated October 24, 2008 and February 23, 2009 are hereby
declared NULL and VOID.
The respondents thus filed with the CA a petition for certiorari to challenge the RTC's
orders denying the quashal of the writ and the respondent's motion for The Public Respondent is hereby directed to DISMISS Civil Case No. 08-29245 for lack of
reconsideration.17 The CA granted the petition and held that with the repeal of the Anti- jurisdiction.
Squatting Law, the respondents' criminal and civil liabilities were extinguished. 18 The
dispositive portion of the decision reads: SO ORDERED.26
WHEREFORE, premises considered, the petition for certiorari with prayer for injunction In their motion for reconsideration,27 the Spouses Supapo emphasized that the court's
is GRANTED. The orders dated June 5, 2003 and July 24, 2003 of Branch 131 of the jurisdiction over an action involving title to or possession of land is determined by its
Regional Trial Court of Caloocan City in Criminal Case No. C-45610 assessed value; that the RTC does not have an exclusive jurisdiction on all complaints
are REVERSED and SET ASIDE. Said court is hereby permanently ENJOINED from for accion publiciana; and that the assessed value of the subject lot falls within MeTC's
further executing or implementing its decision dated March 18, 1996. jurisdiction.
The CA, however, underscored that the repeal of the Anti-Squatting Law does not mean It held that although the MeTC had jurisdiction based on the assessed value of the subject
that people now have unbridled license to illegally occupy lands they do not own, and that lot, the Spouses Supapos' cause of action had already prescribed, the action having been
it was not intended to compromise the property rights of legitimate landowners. 19 In cases filed beyond the ten (l0)-year prescriptive period under Article 555 of the Civil Code. 28 As it
of violation of their property rights, the CA noted that recourse may be had in court by filing was not proven when the actual demand to vacate was made, the RTC ruled that the
the proper action for recovery of possession. reckoning period by which the ejectment suit should have been filed is counted from the
time the certificate to file action was issued. The certificate to file action was issued on
The Spouses Supapo thus filed the complaint for action publiciana.20 November 25, 1992, while the complaint for accion publiciana was filed only on March 7,
2008, or more than ten (10) years thereafter.
After filing their Answer,21 the respondents moved to set their affirmative defenses for
preliminary hearing22 and argued that: (1) there is another action pending between the Dissatisfied with the RTC ruling, the Spouses Supapo appealed to the CA.29
same parties; (2) the complaint for accion publiciana is barred by statute of limitations; and
(3) the Spouses Supapo's cause of action is barred by prior judgment. The CA Ruling30
The MeTC Ruling23 The CA dismissed the appeal and held that the complaint for accion publiciana should
have been lodged before the RTC and that the period to file the action had prescribed.
The MeTC denied the motion to set the affirmative defenses for preliminary hearing. It
ruled that the arguments advanced by the respondents are evidentiary in nature, which at The dispositive portion of the CA decision reads:
best can be utilized in the course of the trial. The MeTC likewise denied the respondents'
motion for reconsideration. WHEREFORE, the appeal is DENIED. The Decision dated June 30, 2009 and Order dated
October 19, 2009 are AFFIRMED.
From the MeTC's ruling, the respondents filed a petition for certiorari with the RTC.24
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Land Titles and Deeds (Finals) 2017
possession only, not ownership. However, where the parties raise the issue of ownership,
SO ORDERED the courts may pass upon the issue to determine who between the parties has the right to
possess the property.35
The Spouses Supapo moved31 but failed32 to secure a reconsideration of the CA decision;
hence, they came to us through the present petition. This adjudication is not a final determination of the issue of ownership; it is only for the
purpose of resolving the issue of possession, where the issue of ownership is inseparably
The Petition linked to the issue of possession. The adjudication of the issue of ownership, being
provisional, is not a bar to an action between the same parties involving title to the
In seeking reversal of the CA's ruling, the Spouses Supapo essentially argue that: property. The adjudication, in short, is not conclusive on the issue of ownership.36
Thus, while we will dissect the Spouses Supapo's claim of ownership over the subject
(1) the MeTC exercises exclusive original jurisdiction over accion publiciana where
property, we will only do so to determine if they or the respondents should have the right of
the assessed value of the property does not exceed P20,000.00, or P50,000.00 if
possession.
the property is located in Metro Manila; and that
(2) prescription had not yet set in because their cause of action is imprescriptible
Having thus determined that the dispute involves possession over a real property, we now
under the Torrens system.
resolve which court has the jurisdiction to hear the case.
The Respondents' Case33
Under Batas Pambansa Bilang 129,37 the jurisdiction of the RTC over actions involving title
to or possession of real property is plenary. 38
The respondents argue that the complaint for accion publiciana was (1) filed in the wrong
court; (2) barred by prescription; and (3) barred by res judicata.
RA No. 7691,39 however, divested the RTC of a portion of its jurisdiction and granted the
Metropolitan Trial Courts, Municipal Trial Courts and Municipal Circuit Trial Courts the
Issues exclusive and original jurisdiction to hear actions where the assessed value of the property
does not exceed Twenty Thousand Pesos (P20,000.00), or Fifty Thousand Pesos
The issues for resolution are: (P50,000.00), if the property is located in Metro Manila.
I. Whether the MeTC properly acquired jurisdiction; Section 1 of RA No. 7691 states:
II. Whether the cause of action has prescribed; and
III. Whether the complaint for accion publiciana is barred by res judicata. Section 1. Section 19 of Batas Pambansa Blg. 129, otherwise known as the "Judiciary
Reorganization Act of 1980," is hereby amended to read as follows:
Section. 19. Jurisdiction in civil cases. - Regional Trial Courts shall exercise exclusive
Our Ruling original jurisdiction:
The petition is meritorious. (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
We hold that: (1) the MeTC properly acquired jurisdiction; (2) the cause of action has not thousand pesos (P20,000.00) or, for civil actions in Metro Manila, where such value
prescribed; and (3) the complaint is not barred by res judicata. exceeds Fifty thousand pesos (P50,000.00) x x x. (Emphasis supplied.)
pesos (P50,000.00) exclusive of interest, damages of whatever kind, attorney's fees, possession has lasted longer than one year. But the real right of possession is not
litigation expenses and costs x x x. (Emphasis supplied.) lost till after the lapse of ten years. (Emphasis supplied.)
In view of these amendments, jurisdiction over actions involving title to or possession of The respondents point out that the Spouses Supapo filed the complaint for accion
real property is now determined by its assessed value.40 The assessed value of real publiciana on March 7, 2008 or more than ten (10) years after the certificate to file action
property is its fair market value multiplied by the assessment level. It is synonymous to was issued on November 25, 1992. The respondents contend that the Spouses Supapo
taxable value.41 may no longer recover possession of the subject property, the complaint having been filed
beyond the period provided by law.
In Quinagoran v. Court of Appeals,42 we explained:
Further, while the respondents concede that the Spouses Supapo hold a TCT over the
[D]oes the RTC have jurisdiction over all cases of recovery of possession regardless of the subject property, and assuming a Torrens title is imprescriptible and indefeasible, they
value of the property involved? posit that the latter have lost their right to recover possession because of laches.
The answer is no. The doctrine on which the RTC anchored its denial of petitioner's Motion On their part, the Spouses Supapo admit that they filed the complaint for accion
to Dismiss, as affirmed by the CA that all cases of recovery of possession or accion publiciana more than ten (10) years after the certificate to file action was issued.
publiciana lies with the regional trial courts regardless of the value of the property no Nonetheless, they argue that their cause of action is imprescriptible since the subject
longer holds true. As tilings now stand, a distinction must be made between those property is registered and titled under the Torrens system.
properties the assessed value of which is below P20,000.00, if outside Metro Manila;
and P50,000.00, if within.43 (Emphasis supplied.) We rule that the Spouses Supapo's position is legally correct.
In this regard, the complaint must allege the assessed value of the real property subject of At the core of this controversy is a parcel of land registered under the Torrens system. The
the complaint or the interest thereon to determine which court has jurisdiction over the Spouses Supapo acquired the TCT on the subject lot in 1979. 46 Interestingly, the
action. This is required because the nature of the action and the court with original and respondents do not challenge the existence, authenticity and genuineness of the
exclusive jurisdiction over the same is determined by the material allegations of the Supapo's TCT.47
complaint, the type of relief prayed for by the plaintiff, and the law in effect when the action
is filed, irrespective of whether the plaintiffs are entitled to some or all of the claims In defense, the respondents rest their entire case on the fact that they have allegedly been
asserted therein.44 in actual, public, peaceful and uninterrupted possession of the subject property in the
concept of an owner since 1992. The respondents contend that they built their houses on
In the present case, the Spouses Supapo alleged that the assessed value of the subject the subject lot in good faith. Having possessed the subject lot for more than ten (10) years,
lot, located in Metro Manila, is P39,980.00. This is proven by the tax declaration 45 issued they claim that they can no longer be disturbed in their possession. 48
by the Office of the City Assessor of Caloocan. The respondents do not deny the
genuineness and authenticity of this tax declaration. Under the undisputed facts of this case, we find that the respondents' contentions have no
legal basis.
Given that the Spouses Supapo duly complied with the jurisdictional requirements, we hold
that the MeTC of Caloocan properly acquired jurisdiction over the complaint for accion In a long line of cases, we have consistently ruled that lands covered by a title cannot
publiciana. be acquired by prescription or adverse possession. We have also held that a claim of
acquisitive prescription is baseless when the land involved is a registered land because of
The cause of action Article 112649 of the Civil Code in relation to Act 496 [now, Section 47 of Presidential
has not prescribed Decree (PD) No. 152950].51
The respondents argue that the complaint for accion publiciana is dismissible for being The Spouses Supapo (as holders of the TCT) enjoy a panoply of benefits under the
filed out of time. Torrens system. The most essential insofar as the present case is concerned is Section 47
of PD No. 1529 which states:
They invoke Article 555 of the Civil Code, which states: Art. 555. A possessor may lose his
possession: Section 47. Registered land not subject to prescriptions. No title to registered land in
derogation of the title of the registered owner shall be acquired by prescription or adverse
possession.
xxxx
In addition to the imprescriptibility, the person who holds a Torrens Title over a land is also
(4) By the possession of another, subject to the provisions of Article 537, if the new
entitled to the possession thereof.52 The right to possess and occupy the land is an
attribute and a logical consequence of ownership. 53 Corollary to this rule is the right of the
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
holder of the Torrens Title to eject any person illegally occupying their property. Again, this The action is not barred
right is imprescriptible.54 by prior judgment
In Bishop v. CA,55 we held that even if it be supposed that the holders of the Torrens Title As a last-ditch effort to save their case, the respondents invoke res judicata. They contend
were aware of the other persons' occupation of the property, regardless of the length of that the decision of the CA in CA-G.R. SP No. 78649 barred the filing of the action
that possession, the lawful owners have a right to demand the return of their property at publiciana.
any time as long as the possession was unauthorized or merely tolerated, if at all. 56
To recall, CA-G.R. SP No. 78649 is the petition for certiorari filed by the respondents to
Even if the defendant attacks the Torrens Title because of a purported sale or transfer of challenge the RTC's issuance of the writ enforcing their civil liability (i.e., to vacate the
the property, we still rule in favor of the holder of the Torrens Title if the defendant cannot subject property) arising from their conviction under the Anti-Squatting Law. The CA
adduce, in addition to the deed of sale, a duly-registered certificate of title proving the granted the petition and permanently enjoined the execution of the respondents' conviction
alleged transfer or sale. because their criminal liability had been extinguished by the repeal of the law under which
they were tried and convicted. It follows that their civil liability arising from the crime had
A case in point is Umpoc v. Mercado57 in which we gave greater probative weight to the also been erased.
plaintiffs TCT vis-a-vis the contested unregistered deed of sale of the defendants. Unlike
the defendants in Umpoc, however, the respondents did not adduce a single evidence to The respondents' reliance on the principle of res judicata is misplaced.
refute the Spouses Supapo's TCT. With more reason therefore that we uphold the
indefeasibility and imprescriptibility of the Spouses Supapo's title. Res judicata embraces two concepts: (1) bar by prior judgment as enunciated in Rule 39,
Section 47(b) of the Rules of Civil Procedure; and (2) conclusiveness of judgment in Rule
By respecting the imprescriptibility and indefeasibility of the Spouses Supapo's TCT, this 39, Section 47(c).62
Court merely recognizes the value of the Torrens System in ensuring the stability of real
estate transactions and integrity of land registration. "Bar by prior judgment" means that when a right or fact had already been judicially tried on
the merits and determined by a court of competent jurisdiction, the final judgment or order
We reiterate for the record the policy behind the Torrens System, viz.: shall be conclusive upon the parties and those in privity with them and constitutes an
absolute bar to subsequent actions involving the same claim, demand or cause of action.63
The Government has adopted the Torrens system due to its being the most effective
measure to guarantee the integrity of land titles and to protect their indefeasibility once the The requisites64 for res judicata under the concept of bar by prior judgment are:
claim of ownership is established and recognized. If a person purchases a piece of land on
the assurance that the seller's title thereto is valid, he should not run the risk of being told (1) The former judgment or order must be final;
later that his acquisition was ineffectual after all, which will not only be unfair to him as the
purchaser, but will also erode public confidence in the system and will force land (2) It must be a judgment on the merits;
transactions to be attended by complicated and not necessarily conclusive investigations
and proof of ownership. The further consequence will be that land conflicts can be even (3) It must have been rendered by a court having jurisdiction over the subject matter and
more abrasive, if not even violent.58 the parties; and
With respect to the respondents' defense59 of laches, suffice it to say that the same is (4) There must be between the first and second actions, identity of parties, subject
evidentiary in nature and cannot be established by mere allegations in the pleadings. 60 In matter, and cause of action.
other words, the party alleging laches must adduce in court evidence proving such
allegation. This Court not being a trier of facts cannot rule on this issue; especially so since Res judicata is not present in this case.
the lower courts did not pass upon the same.
While requisites one to three may be present, it is obvious that the there is no identity of
Thus, without solid evidentiary basis, laches cannot be a valid ground to deny the Spouses subject matter, parties and causes of action between the criminal case prosecuted under
Supapo's petition.61 On the contrary, the facts as culled from the records show the clear the Anti-Squatting Law and the civil action for the recovery of the subject property.
intent of the Spouses Supapo to exercise their right over and recover possession of the
subject lot, viz.: (1) they brought the dispute to the appropriate Lupon; (2) they initiated the First, there is no identity of parties. The criminal complaint, although initiated by the
criminal complaint for squatting; and (3) finally, they filed the action publiciana. To our Spouses Supapo, was prosecuted in the name of the people of the Philippines. The accion
mind, these acts negate the allegation of laches. publiciana, on the other hand, was filed by and in the name of the Spouses Supapo.
With these as premises, we cannot but rule that the Spouses Supapo's right to recover Second, there is no identity of subject matter. The criminal case involves the
possession of the subject lot is not barred by prescription. prosecution of a crime under the Anti-Squatting Law while the accion publiciana is an
action to recover possession of the subject property.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Under this particular concept of res judicata, any right, fact, or matter in issue directly TORRES, JR., J.:
adjudicated or necessarily involved in the determination of an action before a competent
court in which judgment is rendered on the merits is conclusively settled by the judgment Assailed in this Petition for Review on Certiorari is the Decision[1] of the respondent
therein and cannot again be litigated between the parties and their privies, whether or not Court of Appeals dated January 7, 1993 in CA-G.R. No. 22407-CV, the dispositive portion
the claim, demand, purpose, or subject matter of the two actions is the same. 66 of which reads:
As already explained, there is no identity of parties between the criminal complaint under
the Anti-Squatting law and the civil action for accion publiciana. For this reason alone, WHEREFORE, the decision of the lower court is hereby REVERSED and judgment is
"collusiveness of judgment" does not apply. hereby entered ordering defendants Felicidad Vda. de Cabrera and Marykane Cabrera to
vacate the portion of Lot 2238 occupied by them and surrender possession thereof to
Even if we assume, for the sake of argument, that there is identity of parties, plaintiff.
"conclusiveness of judgment" still does not apply because there is no identity of issues.
The issue in the criminal case is whether the respondents (accused therein) committed the SO ORDERED.
crime alleged in the information, while the only issue in accion publiciana is whether the
Spouses Supapo have a better right than the respondents to possess and occupy the
subject property. Reversed by the foregoing pronouncements was the decision [2] of the Regional Trial
Court, Branch 7, Baganga, Davao Oriental in Civil Case No. 379, an action for Quieting of
For all these reasons, the defense of res judicata is baseless. Title to Real Property, Damages with Preliminary Injunction. The trial courts disposition
reads:
Final Note
WHEREFORE, the plaintiff is hereby ordered:
As a final note, we stress that our ruling in this case is limited only to the issue of
determining who between the parties has a better right to possession. This adjudication is
(a) to execute a reconveyance within thirty (30) days after this decision shall have become
not a final and binding determination of the issue of ownership. As such, this is not a bar
final and executory in favor of defendant Felicidad Vda. De Cabrera corresponding only to
for the parties or even third persons to file an action for the determination of the issue of
that portion of Lot No. 2239 actually and physically possessed and occupied by the
ownership.
defendant as seen from the sketch plan of Engr. Enecio Magno (Exh. 2) and pinpointed
and identified during the ocular investigation as to its extent and boundaries of the said
WHEREFORE, premises considered, we GRANT the petition, and
portion bought by defendants Felicidad Vda. De Cabrera from Felicidad Teokemian;
consequently REVERSE and SET ASIDE the February 25, 2011 decision and August 25,
2011 resolution of the Court of Appeals in CA-G.R. SP No. 111674.
(b) To reimburse defendants for litigation expenses and attorneys fees in the amount
SO ORDERED. of P7,000.00; and
SO ORDERED.
On January 16, 1950, a Deed of Sale (Exh. B) was executed by Daniel Teokemian and a) After due notice and hearing, a Writ of Preliminary Mandatory Injunction be issued
Albertana Teokemian in favor of Andres Orais over a parcel of unregistered land situated restraining the defendants from further dispossessing the plaintiff of the land in question;
at Abejod, Cateel, Davao Oriental with an area described as 7.3720 hectares. The
property was owned in common by Daniel and Albertana and their sister Felicidad
b) Ordering the defendants to pay jointly the plaintiff the amount of not less than Sixteen
Teokemian, having inherited the same from their late father, Domingo Thousand Two Hundred (P16,200) as total value of the rice produced from the riceland in
Teokemian. However, the Deed of Sale was not signed by Felicidad, although her name question, and the amount of Twenty One Thousand Six Hundred (P21,600.00) Pesos as
was printed therein as one of the vendors. On January 26, 1950, the parcel of land was the total proceeds of the nuts of the coconut land in question;
surveyed in the name of Virgilia Orais, daughter of the vendee Andres Orais, and
denominated as Lot No. 2239, PLS-287, Cateel Cadastre. As surveyed, the property had
an area of 11.1000 hectares. c) The Defendants be ordered to pay the plaintiff the amount of Twenty Thousand
(P20,000.00) Pesos and Ten Thousand (P10,000.00) Pesos as litigation expenses;
On June 24, 1957, Virgilia Orais was issued Free Patent No. V-79089. Original Certificate
of Title No. P-10908 was issued in her name (Exh. A). d) The defendants be ordered to pay Six Thousand (P6,000.00) Pesos for attorneys fees;
Four Hundred (P400.00) Pesos as expenses for every appearance in Court;
On July 27, 1972, Alberto (sic. Albertana) Teokemian executed a Deed of Absolute Sale
conveying to Elano Cabrera, husband of Felicidad Cabrera, ONE HALF PORTION OF e) The document of sale executed by Felicidad Teokemian and the Tax Declarations
LOT NO. 2239, Cad-287, eastern portion, containing an area of FIFTY FIVE THOUSAND issued to the late Elano Cabrera and Felicidad Vda. De Cabrera and the subsequent Tax
FIVE HUNDRED TEN (55,510) SQUARE METERS, more or less (Exh. 3), which portion Declaration creating a cloud of doubt on the title, possession, rights and interest be
supposedly corresponded to the one-third share in Lot 2239 of Felicidad Teokemian who declared null and void for being fraudulent and without any legal basis and inexistent; and
was not a party to the Deed of Sale earlier executed by her brother and sister in favor of
Andres Orais, Virgilia Orais predecessor-in-interest. It was explained by Felicidad Cabrera f) Such other reliefs and remedies which this Honorable Court may deem just, proper, and
that the Deed of Sale was signed by Albertana Teokemian, not by Felicidad Teokemian, equitable in the premises.
because the whole of Lot 2239 was adjudicated to Albertana in a decision of a cadastral
court dated June 8, 1965 as evidenced by a Certification of an officer-in-charge of the
Office of the Clerk of Court, RTC, Br. 7, Baganga, Davao Oriental (Exh. 4). Felicidad In their answer with counterclaim (pp.10-18, Records), defendants alleged that they
Cabrera and her husband immediately took possession of the western portion of Lot 2239. acquired a portion of Lot 2239 in good faith and for value; that said portion was owned by
Felicidad Teokemian who was not a party to the Deed of Sale executed by Daniel and
Albertana Teokemian on January 16, 1950 in favor of Andres Orais over Lot 2239; that not
In 1974 and 1978, Virgilia Orais brothers, Rodolfo and Jimmy Orais went to Cateel, Davao having signed the Deed of Sale, Felicidad Teokemians one-third share in Lot 2239 could
Oriental and confronted the Cabreras of the latters alleged encroachment and illegal not have been legally conveyed to Andres Orais; that Virgilia Orais (successor-in-interest
occupation of their sisters land, but no concrete action on the matter was pursued by of Andres Orais) committed fraud in including the portion owned by Felicidad Teokemian in
Virgilia Orais until February 11, 1988 when she filed Civil Case No. 379 against Felicidad her applying for free patent over Lot 2239 is concerned pursuant to Art. 1456 of the Civil
Cabrera, now a widow, and her daughter Marykane Cabrera for Quieting of Title to Real Code; and that plaintiff is guilty of laches for not initiating an action against defendants to
Property, Damages with Preliminary Mandatory Injunction. recover the western portion of Lot 2239 despite plaintiffs knowledge of defendants
acquisition thereof in 1972, as in fact it was only in 1988 when the complaint for quieting of
The complaint, which was amended on June 22, 1988 by including Felicidad Teokemian title was filed in court.
as party defendant (pp. 42-47, Records), alleged that sometime in 1972 and 1973 the late
Elano Cabrera and defendant Felicidad Cabrera, knowing that Lot 2239 was already Defendants prayed, thus:
registered in the name of the plaintiff, prepared a document of sale and had Felicidad
Teokemian sign it conveying a portion of said lot to them as described in the Sketch Map
(Annex D of the Complaint), after which they entered and possessed said portion and WHEREFORE, this Honorable Court, after due notice and hearing on the merits of this
enjoyed the fruits thereon. Plaintiff further averred that by reason of the document of sale case; to issue order or orders;
and the declaration of the property involved in the name of defendant Felicidad Vda. De
Cabrera, there created a cloud of doubt on the formers title on said property. 1. Finding the defendants as the rightful, lawful, and legal owner of that portion which was
sold to them by Felicidad Teokemian and which was included in the title of plaintiff;
Plaintiff prayed as follows:
2. To find that the plaintiff did not own the said portion and that they have personal
WHEREFORE, premises considered, plaintiff through the undersigned counsel respectfully knowledge of the same when the plaintiff filed and secured the title under the
prays this Honorable Court that: Administrative Proceeding;
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
3. Finding that the plaintiff is only holding the title to that portion only in an implied trust in We disagree with the lower courts ruling that plaintiff is barred from bringing an action for
favor of the real owner; recovery of ownership. Parenthetically, while the complaint filed by plaintiff is designated
as one for quieting of title, the allegations therein show that it is actually for recovery of
ownership/possession.
4. Finding the plaintiff legally obligated to cause the segregation of the portion at their
expense and deliver formally the said portion to the real owners, the defendants.
First. The Deed of Absolute Sale dated May 27, 1972 (Exh. 3) executed by Albertana
5. To order the plaintiff to execute, prepare and or make any instrument or document to Teokemian in favor of Elcano Cabrera over the portion of 55,510 square meters of Lot
2238 which allegedly pertained to the one-third interest of Felicidad Teokemian did not
finally vest in the Defendants absolute, clear and flawless title or ownership over the
portion which the plaintiff holds title in trust in defendants favor. convey any title to Elcano Cabrera, assuming that Felicidad Teokemian still owned a one-
third portion of Lot 2238 which was already registered in plaintiffs name, considering that
Albertana did not have any authority from Felicidad Teokemian to effect such
6. To Order the Plaintiff to pay actual damages in the sum of P2,000.00 as litigation conveyance. Consequently, defendants Felicidad vda. De Cabrera and Marykane Cabrera
expense and Attorneys fees in the sum of P5,000.00 in favor of defendants; had acquired no title upon which to anchor their claim of ownership over the one-third
portion. Such being the case, plaintiffs cannot be barred by laches from instituting the
7. To direct the plaintiff to account for the share of the real owner of the portion of land action to quiet title against defendants
illegally cultivated and planted by plaintiff to rice in favor of FELICIDAD TEOKEMIAN to be
paid thru the Defendants who are the owners, which consisted in ONE THIRD OF THE xxx
RICE HARVEST every year since the year 1950 to 1972 when the portion was sold and
cultivated by defendant based on the computation of income by the plaintiff in Paragraph
16, a paragraph in the Second Cause of Action of the complaint; Second. There was no allegation, much less proof, that Lot 2239 had been partitioned
among the co-owners Daniel, Albertana, and Felicidad, all surnamed Teokemian, before
the land was sold to Andres Orais in 1950 when the same was still unregistered. This
and to grant the defendants such other reliefs and remedies proper and equitable in the being the case, and assuming that Felicidad Teokemian had retained ownership over an
premises.[3] undivided one-third portion of Lot 2239 despite its being titled in plaintiffs name in 1958,
Felicidad Teokemian could only dispose her undivided interest, not a definite portion
On April 27, 1989, the lower court rendered judgment in favor of defendants and described in the Deed of Sale executed on July 27, 1972 (Exh. 3) as eastern part. Worse,
against the plaintiff, ruling that the latter can no longer recover the western portion of Lot the supposed vendee, Elcano Cabrera, and her successors-in-interest, defendants
2239 conveyed in 1972 by Felicidad Teokemian in favor of the late Elano Cabrera and Felicidad vda. de Cabrera and Marykane Cabrera, occupied the western portion of Lot
Felicidad Cabrera due to laches. In support of its findings, the trial court referred to the 2239, not the eastern portion which was the subject of the sale. Their occupation of a
Courts pronouncements in Lola vs. Court of Appeals,[4] where it was held that although the definite portion of an undivided property, without any color of title, could not have ripened
defense of prescription is unavailing to the petitioners, because, admittedly, the title to the into ownership on the principle of laches.
subject lot was still registered in the name of the respondent, still the petitioners have
acquired title to it by virtue of the equitable principle of laches due to the respondents Third. As testified to by Jimmy Orais, plaintiffs brother, it was only in 1974 when plaintiff
failure to assert her claim and ownership for thirty-two years; and in Republic vs. Court of came to know that her property was occupied by Elcano Cabrera. According to Jimmy, he
Appeals[5] that, while it is true that by themselves tax receipts and declaration of ownership and his elder brother Dr. Rodolfo Orais went to the house of Elcano Cabrera three times in
for taxation purposes are not incontrovertible evidence of ownership, they become strong 1974 and in 1979 complaining of the latters occupancy of their sisters property. Jimmy
evidence of ownership acquired by prescription when accompanied by proof of actual further declared that after Elcano Cabrera was shown plaintiffs title to the property, Elcano
possession of the property; and in Miguel vs. Catalino,[6] that even granting appellants Cabrera proposed a relocation survey of the area to determine whether the premises
proposition that no prescription lies against their fathers recorded title, their passivity and occupied by him were included in the plaintiffs title (T.S.N. pp. 39-44, January 3, 1989). It
inaction for more than thirty four years justifies the defendant appellee in setting up the appears, however, that nothing came out of the proposal to conduct a relocation
equitable defense of laches in his own behalf. survey. From the time plaintiff became aware of Cabreras possession of the western
portion of Lot 2239, which was in 1974, up to the time she instituted the action for quieting
The respondent Court of Appeals reversed such findings upon appeal. of title in 1988, only fourteen (14) years had elapsed. This case, therefore, has no
Even as the appellate court observed that the registration made by the plaintiffs was congruency with those cases where the Supreme Court ruled that the registered owner is
fraudulent insofar as it involved the one-third interest of Felicidad Teokemian, which was barred by laches from recovering his property. Thus, in Lola vs. Court of Appeals (145
not included in the sale executed by them and Albertana and Daniel Teokemian, it SCRA 439), the petitioners acquired title to the land owned by respondent by virtue of the
nevertheless upheld its effects, on the justification that the defendants action for equitable principles of laches due, according to the Supreme Court, to respondents failure
reconveyance based on an implied trust had already been barred by to assert her claims and ownership for thirty-two (32) years. In Miguel vs. Catalino (26
prescription. Furthermore, the action of the plaintiffs is not barred by laches, as was held SCRA 234), the Supreme Court said that appellants passivity and inaction for more than
by the lower court. Said the appellate court: 34 years (1928-1962) justifies the defendant-appellee in setting up the equitable defense
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
of laches in his behalf. In Mejia vs. Gampomana (100 Phil 277), it was held that the original RESPONDENT COURT OF APPEALS ERRED IN HOLDING THAT LACHES DOES NOT
owners right to recover back the possession of the property and title thereto from the APPLY BECAUSE WHAT WAS SOLD TO THE CABRERAS WAS A DEFINITE PORTION
defendant has by the long period of 37 years and by the patentees inaction and neglect OF THE COMMUNITY PROPERTY BEFORE PARTITION, HENCE, VOID AND THAT
been converted into a stale demand. ALBERTANA TEOKEMIAN WHO SIGNED THE DOCUMENT OF SALE IN FAVOR OF
THE CABRERAS HAD NO AUTHORITY FROM HER SISTER-CO-OWNER FELICIDAD
Laches, in a general sense, is failure or neglect, for an unreasonable and unexplained TEOKEMIAN TO EXECUTE THE DEED OF CONVEYANCE.[8]
length of time, to do that which, by the exercise of due diligence, could or should have
been done earlier; it is negligence or omission to assert a right within a reasonable time, The bone of the petitioners contention rests on the alleged waiver of the plaintiff to
warranting a presumption that the party entitled to assert it (Tijam vs. Sibonghanoy, 32 recover any interest she had in the one-third portion of the property inherited by Daniel,
SCRA 29). Since imprescriptibility is one of the basic features of a Torrens title, it is not an Albertana and Felicidad Teokemian from their late father, Domingo, due to the long period
ordinary delay in asserting ones right that will give rise to the application of the principle of of time which lapsed from the time the plaintiffs title was registered until the action for
laches, otherwise, registered title can easily be defeated by prescription. This is precisely quieting of title was instituted.
the reason why, in the cases cited, the delay or inaction by the registered owners in
asserting their rights was considered unreasonable and unexplained because it took them We find merit in the petition.
from 32 to 37 years to do so. In contrast, the delay in the case at bar was only fourteen
At the outset, it must be observed that the Certificate of Title of the plaintiff, which
years.
was derived from Free Patent No. V-79089, issued in the name of Virgilia Orais, leaves
much to be desired in propriety, considering that the Deed of Sale executed by Daniel and
While possession of defendants Felicidad vda. De Cabrera and Marykane Cabrera could Albertana Teokemian, on one hand and Andres Orais on the other, did not bear the
not have ripened into ownership as already discussed, they are possessors in good faith of signature of Felicidad Teokemian, and therefore, did not cover the latters share.
the portion occupied by them and, therefore, entitled to the benefits accorded by the Civil
Code as such.[7] It was the respondent appellate court which observed that the registration of the
plaintiffs title over the subject property was fraudulent insofar as it involved the one-third
interest of Felicidad Teokemian who did not sign the Deed of Sale in favor of plaintiffs
Sisters Felicidad vda. de Cabrera and Marykane Cabrera, together with Felicidad predecessor-in-interest and, therefore, the latter held that portion as a trustee of an implied
Teokemian are now before the Court as Petitioners in this Petition for Review on Certiorari, trust for the benefit of Felicidad, pursuant to Art. 1456 of the Civil Code. [9] Needless to
seeking relief from the respondent courts decision, assigning as errors the following: state, these conclusions, being matters of fact, are entitled to our full affirmation, since they
A are congruent with the findings of the trial court, thus:
RESPONDENT COURT OF APPEALS ERRED IN RULING THAT PRIVATE It would seem from the facts of the case that the basis of the right of plaintiff over the land
RESPONDENTS COMPLAINT FILED IN 1988 FOR QUIETING OF TITLE WHICH in litigation specifically Lot No. 2239 now titled in the name of the plaintiff, located at
ACTUALLY IS ONE FOR RECOVERY OF OWNERSHIP AND POSSESSION AS FOUND Buayahon, Abejod, Cateel, Davao Oriental, proceeded from the Deed of Sale executed by
BY RESPONDENT COURT IS NOT BARRED BY LACHES BECAUSE: Daniel Teokemian and Albertana Teokemian on January 16, 1950 acknowledged before
Judge Proserador Danao as Notary Ex Oficio. Taking a hard look over the aforesaid deed
of sale (Exh. B) the said document apparently included the third heir of Domingo
1. A PERIOD OF 30 YEARS HAD ELAPSED FROM 1958 WHEN TORRENS TITLE WAS Teokemian Felicidad Teokemian because her name was typewritten together with her
ISSUED TO PRIVATE RESPONDENT TO 1988 WHEN HER COMPLAINT BELOW WAS sister Albertana and brother Daniel all surnamed Teokemian in the said document. Again
FILED DURING WHICH PERIOD OF TIME THE PROPERTY HAS BEEN IN OPEN, this fact will come to mind that the vendee Andres Orais was anticipating at the time
CONTINUOUS AND ADVERSE POSSESSION OF THE ORIGINAL OWNER, FELICIDAD Felicidad Teokemian will also sell her share in this portion of land (Lot No. 2239) which at
TEOKEMIAN, FROM 1958, OR EVEN EARLIER IN 1941 WHEN SHE INHERITED THE the time of the sale it was still unregistered land. The non-signing of Felicidad Teokemian
PROPERTY, TO 1972 WHEN SHE SOLD IT TO THE CABRERAS WHO CONTINUED over her typewritten name in this deed of sale (Exh. B) will attest to the fact that she did
THE PRIOR POSSESSION UNTIL 1988 WHEN PRIVATE RESPONDENTS COMPLAINT not sell her share in the lot in question. After this sale the vendee Andres Orais through his
WAS FILED. encargado Melecio Capilitan and later Servillano Abarca immediately took possession of
the two third portion of said parcel of land respecting the third portion owned by Felicidad
2. ASSUMING ARGUENDO RESPONDENT COURTS HOLDING THAT ONLY 14 YEARS HAD Teokemian.[10]
ELAPSED COUNTED FROM 1974 WHEN CABRERAS POSSESSION WAS
QUESTIONED BY PRIVATE RESPONDENTS BROTHERS, STILL THAT PERIOD However, the appellate court stated further that nonetheless, the plaintiffs attempt to
CONSTITUTES LACHES. recover the property is justified because defendant Felicidad Teokemians own action for
reconveyance has already been barred by prescription, [11] which is the same as stating that
B the very tardiness of the plaintiffs in pursuing the present action for reconveyance of the
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
subject property has rendered the defendants defense nugatory, and has made the acquire Certificate of Title covering the properties inherited by the Teokemians, and
fortress of the plaintiffs case impregnable. apparently including that portion belonging to Felicidad Teokemian. In the meantime,
defendant Felicidad vda. De Cabrera and her late husband have been actively in
This conclusion is incorrect. As can be discerned from the established facts, the possession of the same, tilling it, and constructing an irrigation system thereon. This must
Certificates of Title of the vendees Orais are, to say the least, irregular, and were issued in surely constitute such tardiness on the part of the plaintiff constituting the basis for laches.
a calculated move to deprive Felicidad Teokemian of her dominical rights over the property
reserved to her by descent. Plaintiff could not have registered the part reserved to Laches has been defined as the failure or neglect, for an unreasonable and
Felicidad Teokemian, as this was not among those ceded in the Deed of Sale between unexplained length of time, to do that which by exercising due diligence could or should
Daniel/Albertana Teokemian and Andres Orais. It must be remembered that registration have been done earlier; it is negligence or omission to assert a right within a reasonable
does not vest title, it is merely evidence of such title over a particular property. time, warranting a presumption that the party entitled to assert it either has abandoned it or
(Embrado vs. Court of Appeals)[12] declined to assert it.[17] The defense of laches is an equitable one and does not concern
itself with the character of the defendants title, but only with whether or not by reason of
The defense of indefeasibility of the Torrens Title does not extend to a transferee plaintiffs long inaction or inexcusable neglect, he should be barred from asserting his claim
who takes the certificate of title with notice of a flaw in his title. (Anonuevo vs. Court of at all, because to allow him to do so would be inequitable and unjust to defendant. Laches
Appeals)[13] The principle of indefeasibility of title is unavailing where there was fraud that is not concerned merely with lapse of time, unlike prescription. While the latter deals with
attended the issuance of the free patents and titles. (Meneses vs. Court of Appeals) [14] the fact of delay, laches deals with the effect of unreasonable delay. [18]
Be that as it may, that the right of the defendants for reconveyance of the subject This Court emphasized in Mejia de Lucas vs. Gampona,[19] the reason upon which
property arising from an implied trust under Article 1456 of the Civil Code is material to the the rule is based is not alone the lapse of time during which the neglect to enforce the right
instant case, such remedy has not yet lapsed, as erroneously submitted by the plaintiffs, has existed, but the changes of condition which may have arisen during the period in
and, is thus, a bar to the plaintiffs action. In the case of Heirs of Jose Olviga vs. Court of which there has been neglect. In other words, where a court finds that the position of the
Appeals,[15] we observed that an action for reconveyance of a parcel of land based on parties has to change, that equitable relief cannot be afforded without doing injustice, or
implied or constructive trust prescribes in ten years, the point of reference being the date that the intervening rights of third persons may be destroyed or seriously impaired, it will
of registration of the deed or the date of the issuance of the certificate of title over the not exert its equitable powers in order to save one from the consequences of his own
property, but this rule applies only when the plaintiff or the person enforcing the trust is not neglect.
in possession of the property, since if a person claiming to be the owner thereof is in actual
possession of the property, as the defendant is in the instant case, the right to seek In our jurisdiction, it is an enshrined rule that even a registered owner of property
reconveyance, which in effect seeks to quiet title to the property, does not prescribe. The may be barred from recovering possession of property by virtue of laches. Under the Land
reason for this is that one who is in actual possession of a piece of land claiming to be the Registration Act (now the Property Registration Decree), no title to registered land in
owner thereof may wait until his possession is disturbed or his title is attacked before derogation to that of the registered owner shall be acquired by prescription or adverse
taking steps to vindicate his right, the reason for the rule being, that his undisturbed possession. The same is not true with regard to Laches.[20] As we have stated earlier in
possession gives him a continuing right to seek the aid of a court of equity to ascertain and Mejia de Lucas vs. Gamponia, while the defendant may not be considered as having
determine the nature of the adverse claim of a third party and its effect on his own title, acquired title by virtue of his and his predecessors long continued possession (37 years)
which right can be claimed only by one who is in possession. the original owners right to recover back the possession of the property and the title
thereto from the defendant has, by the latters long period of possession and by patentees
As it is, before the period of prescription may start, it must be shown that (a) the inaction and neglect, been converted into a stale demand.
trustee has performed unequivocal acts of repudiation amounting to an ouster of the cestui
que trust; (b) such positive acts of repudiation have been made known to the cestui que The argument that laches does not apply because what was sold to the Cabreras
trust; and, (c) the evidence thereon is clear and positive. [16] was a definite portion of the community property, and, therefore, void, is likewise
untenable.
In the case at bar, the defendant Felicidad Teokemian, and thereafter, the Cabreras,
were in actual possession of the property since it was left to Felicidad Teokemian by her Under Article 493 of the Civil Code:
father in 1941, which possession had not been interrupted, despite the sale of the two-third
portion thereof to the plaintiff in 1950, and the latters procurement of a Certificate of Title
Each co-owner shall have the full ownership of his part and of the fruits and benefits
over the subject property in 1957. Until the institution of the present action in 1988, pertaining thereto, and even he may therefore alienate, assign or mortgage it, and even
plaintiffs, likewise, have not displayed any unequivocal act of repudiation, which could be substitute another person in its enjoyment, except when personal rights are involved. But
considered as an assertion of adverse interest from the defendants, which satisfies the the effect of the alienation or the mortgage, with respect to the co-owners, shall be limited
above-quoted requisites. Thus, it cannot be argued that the right of reconveyance on the to the portion which may be allotted to him in the division upon the termination of the co-
part of the defendants, and its use as defense in the present suit, has been lost by
ownership.
prescription.
On the other hand, the action for reconveyance (quieting of title) of the plaintiff was In Go Ong vs. Court of Appeals,[21] this Court ruled that the heirs, as co-owners, shall
instituted only in 1988, that is, thirty years from the time the plaintiffs husband was able to each have the full ownership of his part and the fruits and benefits pertaining to it. An heir
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
may, therefore, alienate, assign or mortgage it, and even substitute another person in its ESTRELLA TIONGCO YARED G.R. No. 161360
enjoyment, except when the personal rights are involved. But the effect of the alienation or (Deceased) substituted by CARMEN M.
mortgage, with respect to the co-owners, shall be limited to the portion which may be TIONGCO a.k.a. CARMEN MATILDE B. Present:
allotted to him in the division upon the termination of the co-ownership. TIONGCO,
Petitioner, CORONA, C.J.,
Undisputed is the fact that since the sale of the two-third portion of the subject Chairperson,
property to the plaintiff, the latter had allowed Felicidad Teokemian to occupy that one-third LEONARDO-DE CASTRO,
portion allotted to her. There has, therefore, been a partial partition, where the transferees - versus - BERSAMIN,
of an undivided portion of the land allowed a co-owner of the property to occupy a definite DEL CASTILLO, and
portion thereof and has not disturbed the same, for a period too long to be ignored--the VILLARAMA, JR., JJ.
possessor is in a better condition or right (Potior est conditio possidentis).
JOSE B. TIONGCO and ANTONIO G. Promulgated:
Clearly, the plaintiff in this instance is barred from asserting her alleged right over the
DORONILA, JR.,
portion subject matter in the instant case on the ground that their right has been lost by
Respondents. October 19, 2011
laches. In Bailon-Casilao vs. Court of Appeals, we ruled that:
x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x
As early as 1923, this Court has ruled that even if a co-owner sells the whole property as
his, the sale will affect only his own share but not those of the other co-owners who did not DECISION
consent to the sale (Punzalan vs. Boon Liat, 44 Phil 320 [1923]). This is because under the
aforementioned codal provision, the sale or other dispostion affects only his undivided VILLARAMA, JR., J.:
share and the transferee gets only what would correspond to his grantor in the partition of
the things owned in common (Ramirez vs. Bautista, 14 Phil 528 [1909]). xxx For Article
494 of the Civil Code explicitly declares: No prescription shall lie in favor of a co-owner or
co-heir so long as he expressly or impliedly recognizes the co-ownership.[22] Before us on appeal by way of a petition for review on certiorari under Rule 45 is
the Court of Appeals (CA) August 28, 2003 Decision [1] which dismissed petitioner Estrella
IN VIEW WHEREOF, the petition is hereby GRANTED. The decision of the Court of
Appeals dated January 7, 1993 is hereby SET ASIDE. The decision of the trial court dated Tiongco Yareds appeal and affirmed the Decision[2] of the Regional Trial Court (RTC),
April 27, 1989 is hereby REINSTATED in toto.
Branch 26, of Iloilo City, dismissing petitioners complaint for annulment of affidavit of
SO ORDERED.
adjudication, deeds of sale and Transfer Certificates of Title (TCTs), reconveyance and
damages. Also assailed is the appellate courts November 27, 2003 Resolution[3] denying
petitioners motion for reconsideration.
Matilde, Jose, Vicente, and Felipe, all surnamed Tiongco, were born to Atanacio
and Maria Luis Tiongco. Together they were known as the Heirs of Maria Luis de Tiongco.
The present dispute involves three parcels of land namely, Lots 3244, 3246 and
1404, all located in Iloilo City. Lots 3244 and 1404 used to be covered by Original
Certificates of Title (OCTs) Nos. 484 and 1482, respectively, in the names of Matilde (wife
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
of Vicente Rodriguez), Jose (married to Carmen Sonora), Vicente (married to Ursula Based on the records with the Register of Deeds, it also appears that on May 10,
Casador), and Felipe (married to Sabina Montelibano), each in undivided share, while Lot 1974, the same day when the TCTs covering Lots 3244 and 1404 were issued, respondent
3246 used to be covered by OCT No. 368 in the name of Heirs of Maria Luis de Tiongco. [4] Jose sold the said lots to Catalino Torre. TCT Nos. T-37195 and T-37193 were thus
cancelled and TCT Nos. T-37196 and T-37194 were issued in the name of Catalino
While all of the Heirs of Maria Luis de Tiongco have died, they were survived by Torre.[12]
their children and descendants. Among the legitimate children of Jose were petitioner and
Carmelo Tiongco, the father of respondent Jose B. Tiongco. [5] Similarly, the records of the Register of Deeds showed that Lot 3246 was
likewise disposed of by respondent Jose. On March 30, 1979, or barely two days after
Sometime in 1965, petitioner built her house on Lot 1404[6] and sustained herself obtaining TCT No. T-4665, respondent Jose sold Lot 3246 to respondent Antonio G.
by collecting rentals from the tenants of Lots 3244 and 3246. In 1968, petitioner, as one of Doronila, Jr. who was issued TCT No. T-4666 which cancelled TCT No. T-4665. Catalino
the heirs of Jose, filed an adverse claim affecting all the rights, interest and participation of Torre also sold Lots 3244 and 1404 on the same date to Doronila who was issued the
her deceased father on the disputed lots, but the adverse claim was annotated only on corresponding new TCTs.[13] However, just a few days later, or on April 2, 1979, Doronila
OCT No. 484 and OCT No. 1482, respectively covering Lots 3244 and 1404. [7] sold Lot 1404 back to respondent Jose. Lots 3244 and 3246 were also sold back to
respondent on January 17, 1980.[14]
In 1983, respondent Jose prohibited petitioner from collecting rentals from the
tenants of Lots 3244 and 3246. In December 1983, respondent Jose filed a suit for On October 2, 1990, petitioner filed a complaint before the court a quo against
recovery of possession with preliminary injunction against several tenants of Lots 3244 her nephew respondent Jose and respondent Antonio G. Doronila, Jr. Petitioner argued
and 3246 wherein he obtained a judgment in his favor.[8] Respondent Jose also filed a that respondent Jose knowingly and wilfully made untruthful statements in the Affidavit of
case for unlawful detainer with damages against petitioner as she was staying Adjudication because he knew that there were still other living heirs entitled to the said
on Lot 1404. While the RTC, Branch 33, of Iloilo City ruled in respondent Joses favor, the properties.[15] Petitioner claimed that the affidavit was null and void ab initio and as such, it
CA reversed the RTCs decision and ruled in favor of petitioner. [9] As such, respondent did not transmit or convey any right of the original owners of the properties. Any transfer
Jose never took possession of the properties. whatsoever is perforce likewise null and void. [16] Moreover, the petitioner averred that since
respondent Jose executed said documents through fraud, bad faith, illegal manipulation
In 1988, when petitioner inquired at the Office of the Register of Deeds of Iloilo and misrepresentation, Lots 3244 and 1404 should be reconveyed to its original registered
City, she discovered that respondent Jose had already executed an Affidavit of owners and Lot 3246 to the heirs of Maria Luis de Tiongco subject to subsequent partition
Adjudication[10] dated April 17, 1974, declaring that he is the only surviving heir of the among the heirs.[17] Petitioner also posited that granting for the sake of argument that the
registered owners and adjudicating unto himself Lots 3244, 3246 and 1404. Consequently, affidavit of adjudication was simply voidable, respondent Jose became a trustee by
the OCTs of the aforementioned lots were cancelled, and in place thereof, the Register of constructive trust of the property for the benefit of the petitioner. [18]
Deeds of Iloilo City issued TCT No. T-37195 for Lot 3244, TCT No. T-4665 for Lot 3246,
and TCT No. T-37193 for Lot 1404, all in the name of respondent Jose. [11]
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Respondent Jose, for his part, argued that the petitioners father, Jose, was not Petitioner raised the following arguments in the petition, to wit:
an heir of Maria Luis de Tiongco but an heir of Maria Cresencia de Loiz y Gonzalez vda.
A. THE HONORABLE COURT OF APPEALS ERRED IN
De Tiongco. Respondent Jose claimed that he was the only legitimate son and that while it AFFIRMING THE LOWER COURT THAT THE AFFIDAVIT
OF ADJUDICATION EXECUTED BY RESPONDENT JOSE
was true that he has two other siblings, he refused to acknowledge them because they are B. TIONGCO, WHO IS A LAWYER AND IS AWARE OF ITS
NULLITY, IS MERELY VOIDABLE; ON THE CONTRARY,
illegitimate.[19] Respondent Jose denied that the series of sales of the properties was
SAID DOCUMENT IS A COMPLETE NULLITY BECAUSE
fraudulent. He claimed that Lot 3244 was bought by the City of Iloilo from its own auction RESPONDENT JOSE B. TIONGCO HAS MALICIOUSLY
AND IN BAD FAITH ADJUDICATED IN FAVOR OF HIMSELF
sale for tax delinquency and was merely resold to him. Respondent Jose averred that he THE PROPERTIES IN QUESTION OVER WHICH HE, AS A
LAWYER, KNOWS HE HAS NO RIGHTS WHATSOEVER
has been paying real property taxes on the said properties for more than ten (10) years AND HE ALSO KNOWS HAS BEEN IN POSSESSION OF
and that petitioner collected rentals from Lots 3244 and 3246 only because he allowed THE PETITIONER AND HER PREDECESSORS-IN-
INTEREST UNTIL THE PRESENT.
her.[20]
B. THE HONORABLE COURT OF APPEALS ERRED IN
AFFIRMING THE DISMISSAL OF PETITIONERS
COMPLAINT BY THE LOWER COURT ON THE GROUND
After trial, the Iloilo City RTC ruled in favor of respondent Jose. The court a
OF PRESCRIPTION BECAUSE THE RESPONDENT JOSE
quo ruled that prescription has set in since the complaint was filed only on October 2, B. TIONGCOS AFFIDAVIT OF ADJUDICATION, BEING A
TOTAL NULLITY, THE ACTION TO DECLARE SUCH
1990 or some sixteen (16) years after respondent Jose caused to be registered the NULLITY AND OF THOSE SUBSEQUENT TRANSACTIONS
ARISING FROM SAID ADJUDICATION DOES NOT
affidavit of adjudication on May 10, 1974.[21] PRESCRIBE, ESPECIALLY BECAUSE IN THIS CASE THE
PETITIONER AND HER PREDECESSORS-IN-
INTEREST HAVE ALWAYS BEEN IN POSSESSION OF THE
Aggrieved, petitioner appealed to the CA[22] which, however, sustained the trial LOTS IN QUESTION AND RESPONDENT JOSE B.
TIONGCO HAS NEVER BEEN IN POSSESSION
courts ruling. The CA agreed with the trial court that an action for reconveyance can THEREOF.[24]
indeed be barred by prescription. According to the CA, when an action for reconveyance is
C. FURTHER, EVEN IF ARGUENDO, THE AFFIDAVIT OF
based on fraud, it must be filed within four years from discovery of the fraud, and such ADJUDICATION IS VOIDABLE, THE HONORABLE COURT
OF APPEALS STILL ERRED IN AFFIRMING THE
discovery is deemed to have taken place from the issuance of the original certificate of DISMISSAL OF THE COMPLAINT BY THE LOWER COURT
ON THE GROUND OF PRESCRIPTION BECAUSE THE
title. On the other hand, an action for reconveyance based on an implied or constructive
RESPONDENT, JOSE B. TIONGCO, BEING A LAWYER
trust prescribes in ten (10) years from the date of issuance of the original certificate of title AND BEING AWARE OF PETITIONERS OWNERSHIP OF
THE LOTS IN QUESTION, THE SAID AFFIDAVIT OF
or transfer certificate of title. For the rule is that the registration of an instrument in the ADJUDICATION MAKES THE RESPONDENT AN IMPLIED
TRUSTEE THEREOF FOR THE PETITIONER AND THE
Office of the Register of Deeds constitutes constructive notice to the whole world and ACTION FOR RECONVEYANCE BASED ON TRUST DOES
therefore the discovery of fraud is deemed to have taken place at the time of NOT PRESCRIBE SO LONG AS THE BENEFICIARY LIKE
THE PETITIONER HAS BEEN IN ACTUAL PHYSICAL
registration.[23] POSSESSION OF THE PROPERTY SUBJECT THEREOF,
AS HELD IN THE CASE OF VDA. DE CABRERA VS.
COURT OF APPEALS (267 SCRA 339).[25]
Petitioner filed a motion for reconsideration of the above ruling, but the CA as
aforesaid, denied petitioners motion. Hence, the present petition for review on certiorari.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
The only issue in this case is who has a better right over the properties. remains in possession of the subject land, the action for reconveyance becomes in effect
The Court reiterated such rule in the case of Vda. de Cabrera v. Court of
The Court agrees with the CAs disquisition that an action for reconveyance can
Appeals,[32] wherein we ruled that the imprescriptibility of an action for reconveyance
indeed be barred by prescription. In a long line of cases decided by this Court, we ruled
based on implied or constructive trust applies only when the plaintiff or the person
that an action for reconveyance based on implied or constructive trust must perforce
enforcing the trust is not in possession of the property. In effect, the action for
prescribe in ten (10) years from the issuance of the Torrens title over the property.[26]
reconveyance is an action to quiet the property title, which does not prescribe.
In this case, petitioners possession was disturbed in 1983 when respondent And while it is settled that every person dealing with a property registered under
[35]
Jose filed a case for recovery of possession. The RTC of Iloilo City ruled in the Torrens title need not inquire further but only has to rely on the title, this rule has an
respondent Joses favor but the CA on November 28, 1991, during the pendency of the exception. The exception is when the party has actual knowledge of facts and
[36]
present controversy with the court a quo, ruled in favor of petitioner. Petitioner never circumstances that would impel a reasonably cautious man to make such inquiry or when
lost possession of the said properties, and as such, she is in a position to file the the purchaser has some knowledge of a defect or the lack of title in his vendor or of
complaint with the court a quo to protect her rights and clear whatever doubts has been sufficient facts to induce a reasonably prudent man to inquire into the status of the title of
cast on her title by the issuance of TCTs in respondent Joses name. the property in litigation. The presence of anything which excites or arouses suspicion
should then prompt the vendee to look beyond the certificate and investigate the title of the
The Court further observes that the circuitous sale transactions of these vendor appearing on the face of said certificate. One who falls within the exception can
properties from respondent Jose to Catalino Torre, then to Antonio Doronila, Jr., and back neither be denominated an innocent purchaser for value nor a purchaser in good faith and
again to respondent Jose were quite unusual. However, this successive transfers of title hence does not merit the protection of the law. [39]
from one hand to another could not cleanse the illegality of respondent Joses act of
adjudicating to himself all of the disputed properties so as to entitle him to the protection of In this case, when the subject properties were sold to Catalino Torre and
the law as a buyer in good faith. Respondent Jose himself admitted that there exists other subsequently to Doronila, respondent Jose was not in possession of the said properties.
heirs of the registered owners in the OCTs. Even the RTC found that [t]hese allegations Such fact should have put the vendees on guard and should have inquired on the interest
contained in the Affidavit of Adjudication executed by defendant Jose B. Tiongco are false of the respondent Jose regarding the subject properties. [40] But regardless of such defect
because defendant Jose B. Tiongco is not the only surviving heir of Jose Tiongco, Matilde on transfer to third persons, the properties again reverted back to respondent Jose.
Tiongco, Vicente Tiongco and Felipe Tiongco as the latters have other children and Respondent Jose cannot claim lack of knowledge of the defects surrounding the
grandchildren who are also their surviving heirs. [37] cancellation of the OCTs over the properties and benefit from his fraudulent actions. The
subsequent sale of the properties to Catalino Torre and Doronila will not cure the nullity of
In the case of Sandoval v. Court of Appeals,[38] the Court defined an innocent the certificates of title obtained by respondent Jose on the basis of the false and fraudulent
purchaser for value as one who buys property of another, without notice that some other Affidavit of Adjudication.
person has a right to, or interest in, such property and pays a full and fair price for the
same, at the time of such purchase, or before he has notice of the claim or interest of WHEREFORE, the petition for review on certiorari is GRANTED. The August 28,
some other persons in the property. He is one who buys the property with the belief that 2003 Decision and November 27, 2003 Resolution of the Court of Appeals in CA-G.R. CV
the person from whom he receives the thing was the owner and could convey title to the No. 44794 are hereby REVERSED and SET ASIDE. The Register of Deeds of Iloilo City is
property. A purchaser can not close his eyes to facts which should put a reasonable man ordered to RESTORE Original Certificates of Title Nos. 484, 1482, and 368, respectively
SO ORDERED. DECISION
GARCIA, J.:
Under consideration is this petition for review under Rule 45 of the Rules of Court to nullify
and set aside the following issuances of the Court of Appeals (CA) in CA-G.R. CV No.
64548, to wit:
2. Resolution2 dated January 23, 2002, denying the petitioners motion for
reconsideration.
The petition embodies an alternative prayer for this Court to remand the case to the trial
court for the presentation of an expert witness.
The facts:
On September 19, 1996, in the RTC of Tagbilaran City, a Complaint for Declaration of
Nullity of Deed of Sale, Cancellation of TCT No. (8585) T-4767 and all Subsequent
Documents and Damages3 was filed by the petitioners against respondents Carmelita
Loquellano Vda. de Mende, the Heirs of Evans B. Mende, and the Register of Deeds of the
City of Tagbilaran. Thereat docketed as Civil Case No. 5970 and raffled to Branch 47 of
the court, the Complaint alleges that petitioners Procopio Tapuroc and all the successors-
in-interest of deceased co-owner Antonia Ebe are the co-owners, co-heirs and/or
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
descendants of the original owners of a parcel of land with an area of 5,795 square As stated at the outset hereof, the appellate court, in its Decision 6 of September 21, 2001,
meters, more or less, situated in the Barrio (now District) of Booy, Tagbilaran, Bohol and dismissed the petitioners appeal and affirmed that of the trial court. Their motion for
previously covered by TCT No. 3444; that sometime in 1992, when the petitioners decided reconsideration having been denied by the CA in its Resolution 7 of January 23, 2002, the
to partition the subject property, they discovered from the Office of the City Assessor that petitioners are now with this Court via the instant recourse on their main submission that -
the title covering the land was already in the name of a certain Evans Mende by virtue of a
Deed of Sale purportedly executed in favor of the latter by their predecessors-in-interest on THE HONORABLE COURT OF APPEALS COMMITTED REVERSIBLE ERROR WHEN IT
December 30, 1967; that said Deed of Sale is a forged document because the alleged DISMISSED THE APPEAL OF THE PETITIONERS DESPITE SUFFICIENCY OF
vendors therein, who were Procopio Tapuroc and the predecessors-in-interest of the other SUPPORTING EVIDENCE TO WARRANT A FAVORABLE JUDGMENT ON THE PART
petitioners, did not sign the conveying deed nor receive any consideration therefor; and OF THE PETITIONERS,
that one of the alleged vendors, Antonia Ebe, had already passed away in 1960, or long
before the purported Deed of Sale was said to have been executed in 1967. Petitioners, as
plaintiffs, thus pray for the nullification of the same Deed of Sale, the cancellation of the and presenting for our resolution the following issues:
title issued pursuant thereto in the name of Evans Mende and the restoration of the
previous title in their names, plus damages. I
In their Answer,4 the respondent Mendes, as defendants, denied the material allegations of WHETHER OR NOT THE DEED OF SALE ALLEGEDLY EXECUTED ON DECEMBER
the Complaint and averred that the late Evans Mende, husband of respondent Carmelita 30, 1967 BETWEEN THE PETITIONERS PREDECESSORS-IN-INTEREST AND THE
Loquellano Vda. de Mende and father of the herein co-respondents, bought the subject RESPONDENTS IS VALID.
parcel of land from its previous owners on December 12, 1967 as evidenced by a Deed of
Sale duly notarized by Atty. Rodolfo Yap. They further assert that they had been in open,
continuous, and peaceful possession of the land in question from the time of said sale, and II
had been religiously paying the realty taxes due thereon. By way of affirmative defense,
the respondents assert that petitioners cause of action, if any, had already prescribed in WHETHER OR NOT THE COURT OF APPEALS HAS CONTRADICTED ITSELF AND
view of the unreasonable delay in filing the suit in court, let alone the fact that their ARRIVED AT A CONCLUSION CONTRARY TO THE RECORDS, LAW AND THE
(respondents) title has become indefeasible. APPLICABLE JURISPRUDENCE.
On June 7, 1999, after due proceedings, the trial court came out with its decision 5 finding The recourse must fail.
that the evidence adduced by the plaintiffs (now petitioners) was insufficient to establish
their claim that the questioned Deed of Sale was a forgery. The court explained that
despite the opportunity given them, the plaintiffs failed to present a handwriting expert to As it is, the petitioners call for a review of the facts of the case. This is evident from the
determine whether the said Deed of Sale was indeed a forged instrument, adding that pleadings they filed with this Court. In their main petition8 and Memorandum,9 the
laches had already set in because of plaintiffs inaction and neglect in questioning the petitioners emphatically state:
supposed forged character of the document after the lapse of more than twenty-nine (29)
years from the time of its execution. Accordingly, the trial court rendered judgment The issue in the case at bar boils down to whether or not the signatures of the petitioners
dismissing the Complaint, thus: predecessors-in-interest and Procopio Tapuroc (the only surviving vendor to the alleged
deed of sale) were forged; and if they were, is the declaration of nullity of the said deed of
WHEREFORE, PREMISES CONSIDERED, judgment is hereby rendered DISMISSING sale dated December 13, 1967 is proper (sic).
the complaint for lack of merit. No compensation for damages, moral, exemplary and
litigation expenses is awarded for failure of plaintiffs (sic) to prove by preponderance of Clearly, the foregoing statement calls for a determination of the truth or falsehood of an
evidence the existence of malice or bad faith in filing the instant case. alleged fact, a matter not for this Court to resolve. Well-settled is the rule that factual
questions may not be raised in a petition for review on certiorari. Section 1 of Rule 45 of
SO ORDERED. the Revised Rules of Court is explicit. It reads:
From the adverse decision of the trial court, the petitioners went on appeal to the CA in SECTION 1. Filing of petition with Supreme Court. A party desiring to appeal by certiorari
CA-G.R. CV No. 64548, faulting the court of origin in ruling that they failed to present from a judgment or final order or resolution of the Court of Appeals, the Sandiganbayan,
convincing evidence to prove the fact of forgery in the execution of the assailed Deed of the Regional Trial Court or other courts whenever authorized by law, may file with the
Sale. They likewise faulted the lower court in denying their motion to have the original copy Supreme Court a verified petition for review on certiorari. The petition shall raise only
of the Deed of Sale in dispute and their own Special Power of Attorney containing the questions of law which must be distinctly set forth. (Emphasis supplied)
genuine signatures of their predecessors-in-interest, be examined by a handwriting expert.
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Land Titles and Deeds (Finals) 2017
Evident it is from the above that the function of the Court in petitions for review on certiorari petitioners failed to present an expert witness, only themselves ought to be blamed. For,
is limited to reviewing errors of law that may have been committed by the lower courts. as the trial court itself pointed out in its decision:
And, as a matter of sound practice and procedure, the Court defers and accords finality to
the factual findings of trial courts, more so when, as here, such findings are undisturbed by
x x x. Plaintiffs, despite the opportunity given them by this Court, failed to present a
the appellate court. This factual determination, as a matter of long and sound appellate handwriting expert to determine whether there was indeed forgery in the execution of the
practice, deserves great weight and shall not be disturbed on appeal, save only for the subject Deed of Sale. In the absence of the testimony of the handwriting expert, the
most compelling reasons,10 such as when that determination is clearly without evidentiary allegations of forgery by the plaintiffs is merely self-serving. Unfortunately, this Court is not
support or when grave abuse of discretion has been committed. 11 This is as it should be in the position to assess or evaluate the differences and similarities in the questioned
since the Court, in petitions for review of CA decisions under Rule 45 of the Rules of Court, signatures, much less, categorically state whether or not forgery exists. Neither could this
usually limits its inquiry only to questions of law. Stated otherwise, it is not the function of court rely on the observation of the plaintiffs as to the alleged "glaring differences and
the Court to analyze and weigh all over again the evidence or premises supportive of the dissimilarities" of the questioned signatures. (Underscoring ours)
factual holdings of lower courts.12 The Court refrains from further scrutiny of factual
findings of trial courts, more so when those findings are affirmed by the CA, as here. To do
otherwise would defeat the very essence of Rule 45 and would convert the Court into a Moreover, the technical procedure utilized by handwriting experts, while usually helpful in
trier of facts, which it is not meant to be.13 the examination of forged documents, is not mandatory or indispensable to the
examination or comparison of handwritings.[16]
What is more, it appears undisputed that the assailed Deed of Sale is a public document,
having been duly notarized by a certain Atty. Rodolfo Yap who, unfortunately, had already In Jimenez v. Commission on Ecumenical Mission and Relations of the United
passed away. Being a notarial instrument, the deed in question is a public document and Presbyterian Church in the USA,[17]the Court identified and explained the factors involved
as such enjoys the presumption of regularity in its execution. To overthrow that in the examination and comparison of handwritings:
presumption, sufficient, clear and convincing evidence is required, otherwise the document
should be upheld.14 xxx [T]he authenticity of a questioned signature cannot be determined solely upon its
general characteristics, similarities or dissimilarities with the genuine signature.
Petitioners maintain, however, that by merely examining the signatures in the questioned Dissimilarities as regards spontaneity, rhythm, pressure of the pen, loops in the strokes,
Deed of Sale and the genuine signatures of their predecessors-in-interest in their Special signs of stops, shades, etc., that may be found between the questioned signatures and the
Power of Attorney, the glaring dissimilarities between the two sets of signatures are genuine one are not decisive on the question of the formers authenticity. The result of
immediately evident to support their claim of forgery. examinations of questioned handwriting, even with the benefit of aid of experts and
scientific instruments, is, at best, inconclusive. There are other factors that must be taken
into consideration. The position of the writer, the condition of the surface on which the
We are not convinced.
paper where the questioned signature is written is placed, his state of mind, feelings and
nerves, and the kind of pen and/or paper used, play an important role on the general
As a rule, forgery cannot be presumed. It must be proved by clear, positive and convincing appearance of the signature. Unless, therefore, there is, in a given case, absolute
evidence. Mere allegation of forgery is not evidence and the burden of proof lies on the absence, or manifest dearth, of direct or circumstantial competent evidence on the
party alleging it.15 Here, the petitioners failed to discharge their burden. character of the questioned handwriting, much weight should not be given to characteristic
similarities, or dissimilarities, between that questioned handwriting and an authentic one.
As it were, the petitioners merely alleged that they filed two motions before the trial court to
have the original copy of the documents in the Office of the Register of Deeds of And to determine forgery, the Court in Cesar v. Sandiganbayan18 (quoting Osborn, The
Tagbilaran City be examined by handwriting experts but their motions were ignored by the Problem of Proof) wrote:
trial court. They then harp on the excuse that they could not be expected to prove forgery if
the trial court denied them the opportunity to do so. The process of identification, therefore, must include the determination of the extent, kind,
and significance of this resemblance as well as of the variation. It then becomes necessary
We are not persuaded. to determine whether the variation is due to the operation of a different personality, or is
only the expected and inevitable variation found in the genuine writing of the same writer. It
The trial court correctly ruled that the parties themselves dictate the course and flow of the is also necessary to decide whether the resemblance is the result of a more or less skillful
presentation of evidence, as well as the witnesses for each side. Considering that the case imitation, or is the habitual and characteristic resemblance which naturally appears in a
before it is civil, not criminal, the lower court certainly cannot, on its own, issue an order genuine handwriting. When these two questions are correctly answered the whole problem
requiring a handwriting expert to appear before it and compare the documents presented of identification is solved.
by the parties. It behooves upon the parties themselves to call forth their own set of
witnesses and present their own evidence to bolster their respective claims. If the
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
In the present case, all that the petitioners had to offer by way of evidence on the issue of property for a considerable period of time. With the Mendes possession in this case
forgery was their bare denial that their predecessors-in-interest signed the subject Deed of having been in the concept of an owner and the land itself registered in their names for
Sale. Such denial will not suffice to overcome the presumption of regularity of notarized more than thirty (30) years now, their title thereto had become indefeasible and their
documents, to overthrow which, the countervailing evidence must be clear, convincing and possession could no longer be disturbed. The petitioners failure to take the necessary
more than merely preponderant.19 steps to assert their alleged right for at least twenty-nine (29) years from date of
registration of title is fatal to their cause of action on the ground of laches.
Moreover, and as aptly pointed out by the lower court in its decision of June 7, 1999:
As a final note, we emphasize that a Torrens title cannot be collaterally attacked. The
However, even if it were true that the signature of Antonia Ebe is forged, it cannot brush question on the validity of a Torrens title, whether fraudulently issued or not, can be raised
aside the fact that all the heirs of Antonia Ebe, namely: Celedonia Putong, Eufemio only in an action expressly instituted for that purpose. The title represented by the
Putong, Gregorio Putong and Mariano Putong all signed in the Deed of Absolute Sale. As certificate cannot be changed, altered, modified, enlarged, diminished, or cancelled in a
earlier discussed their signatures cannot be said to have been forged as evidence collateral proceeding. The action for the declaration of nullity of deed of sale commenced
presented to prove the same is found to be insufficient. Henceforth, all the rightful heirs by the petitioners in the RTC of Tagbilaran City is not the direct proceeding required by law
who could question the subject sale are themselves signatories of the supposed to attack a Torrens certificate of title.
questionable transaction.
WHEREFORE, the instant petition is DENIED and the challenged decision of the CA is
Meanwhile, granting that Procopio Tapurocs signature found on Exh. C is indeed a AFFIRMED.
forgery, he testified in open court that he discovered the sale and the fact of Mendes
possession of the subject land in 1967 yet and did not do anything about it. No pronouncement as to costs.
At the other end of the spectrum, the respondents presented sufficient proof of their claim SO ORDERED.
of ownership over the property in dispute. The respondent Mendes maintain that they had
been in continuous, peaceful and open possession of the property since 1967, the year of
the alleged sale, or for more than thirty (30) years now. No less than the petitioners
themselves acknowledged this in their pleadings 20 before this Court. And beginning the
year 1968, the respondents have been religiously paying the realty taxes due on the same
property. Likewise, when TCT No. 3444 was lost, respondent Carmelita Loquellano Vda.
de Mende filed a petition for judicial reconstitution to secure a second owners copy of the
lost title. Said petition went through the proper procedure and thereafter Carmelita was
issued a second owners copy of TCT No. 3444 which was later changed to TCT No.
(8585) T-4767.
All told, we find that the petitioners, who initiated in the court of origin the basic complaint
in this case, have not sufficiently met the burden of proof to sustain their cause.
Additionally, we agree with the CA in ruling that laches had barred the petitioners:
xxx The records show that they [petitioners] did not institute any action against the order of
the then Court of First Instance, 14th Judiciary District. Their inaction and failure to assert
any right, if any, over the disputed lot, bars them from recovering the same as said failure
clearly asserts to laches.
Not to be overlooked is the fact that the petitioners filed their complaint of declaration of
nullity only after twenty-nine (29) years from the execution of the alleged forged deed of
sale. In the meanwhile, title to the property had already been in the name of respondent
Mendes since 1967. The Mendes had been in open, continuous and peaceful possession
of the subject land, and had been religiously paying the realty taxes due thereon. These
are hard facts that ought not to be disregarded. The Court, in a long line of cases, 21 has
uniformly held in favor of the registered owner who had been in possession of a disputed
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Land Titles and Deeds (Finals) 2017
repeated demands, failed and refused to vacate the premises and to pay the rentals
[1]
This petition for review on certiorari assails the Decision of the Court of Appeals in CA- thereof.[6]
G.R. SP No. 91442 dated June 27, 2006, which set aside the Decision of the Regional
Trial Court (RTC) of Makati City, Branch 134, in Civil Case No. 03-517, and reinstated the In their Answer, respondents claimed ownership over the subject property by
Decision of the Metropolitan Trial Court (MTC) of Makati City, Branch 63, in Civil Case No. succession. They alleged that while petitioner is the registered owner of the property,
75717, dismissing the complaint for ejectment; as well as the Resolution denying the however, she is not the lawful owner thereof because the June 14, 1984 Deed of Absolute
motion for reconsideration. Sale was simulated and void. As in Civil Case No. 01-1641 now pending before the RTC of
Makati City, Branch 141, which they filed to assail the validity of the said sale, respondents
Juanito Rodriguez owned a five-door apartment located at San Jose Street, Guadalupe maintain that petitioner exerted undue influence over their father, who at that time was
[2]
Nuevo, Makati City, and covered by TCT No. 144865. On October 27, 1983, Juanito seriously ill, to agree to the sale of the property for only P20,000.00 after knowing that only
executed a Huling Habilin at Testamento giving petitioner Cresenciana Tubo Rodriguez, two apartments were given to her in the Huling Habilin at Testamento. Further, she had no
his live-in partner, apartments D and E, and his children Benjamin Rodriguez (the cause of action against them for being a party to the August 23, 1990 Partition Agreement
deceased husband of respondent Evangeline Rodriguez), apartment A, respondent wherein they recognized each other as co-owners and partitioned the property in
[3]
Buenaventura Rodriguez, apartment B, and respondent Belen Rodriguez, apartment C. accordance with the provision of the last will and testament. [7]
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Land Titles and Deeds (Finals) 2017
On February 26, 2002, the MTC rendered a judgment in favor of the respondents and held Aggrieved, respondents filed a petition for review before the Court of Appeals
that the deed of sale was simulated otherwise petitioner would not have entered into the which reversed and set aside the decision of the RTC and reinstated the decision of the
Partition Agreement, which legally conferred upon each heir exclusive ownership over their MTC. It held that the MTC correctly received evidence on ownership since the question of
respective shares, thus: possession could not be resolved without deciding the issue of ownership. Further,
the Huling Habilin at Testamento transmitted ownership of the specific apartments not only
WHEREFORE, the Complaint is DISMISSED. Plaintiff is
ordered to pay attorneys fees of P10,000.00 and the costs of suit in to the respondents but also to the petitioner; and pursuant thereto, the parties executed
favor of defendants.
the Partition Agreement in accordance with the wishes of the testator, thus:
SO ORDERED.[8]
title is existing and valid. This is true also with respect to the deed of sale. The present
The motion for reconsideration was denied hence, petitioner filed the present petition for
action, which involves only the issue of physical or material possession, is not the proper
review raising the following errors:
action to challenge it. Further, the MTC erred when it relied heavily on the Huling Habilin at
Testamento, which was not probated hence has no effect and no right can be claimed I.
therein. The Partition Agreement which was allegedly entered into pursuant to the Huling THE COURT OF APPEALS COMMITTED A REVERSIBLE ERROR OF
LAW AND GRAVE ABUSE OF DISCRETION IN REVERSING AND
Habilin at Testamento should not also be considered. Thus: SETTING ASIDE THE DECISION OF THE REGIONAL TRIAL COURT
AND REINSTATING THE DECISION OF THE METROPOLITAN TRIAL
COURT DISMISSING PETITIONERS COMPLAINT FOR UNLAWFUL
WHEREFORE, premises considered, the decision rendered by the DETAINER.
Metropolitan Trial Court, Branch 63, Makati City, is hereby ordered
REVERSED AND SET ASIDE. Consequently, judgment is hereby II.
rendered ordering the defendants and all persons claiming rights under
them to vacate the premises and surrender the possession thereof to THE COURT OF APPEALS COMMITTED A REVERSIBLE ERROR OF
the plaintiff. Defendants are likewise ordered to pay jointly and severally LAW AND GRAVE ABUSE OF DISCRETION IN DECLARING THAT
the plaintiff an amount of P5,000.00 a month per unit beginning 13 THE PROPERTY, A PARCEL OF LAND UPON WHICH A FIVE-UNIT
August 2001 until they finally vacate the premises and the costs of this APARTMENT STANDS, BECAME THE SUBJECT OF JUANITO
suit. RODRIGUEZS HULING HABILIN AT TESTAMENTO WHEREIN THE
PROPERTY WAS DISTRIBUTED TO HIS HEIRS (HEREIN
SO ORDERED.[9] RESPONDENTS) INCLUDING THE RESPONDENT (PETITIONER
HEREIN).[11]
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Land Titles and Deeds (Finals) 2017
Petitioner alleges that as the registered owner of the subject property, she enjoys summary proceeding intended to provide an expeditious means of protecting actual
the right of possession thereof and that question of ownership cannot be raised in an possession or right to possession of property, the question of title is not involved[14] and
ejectment case unless it is intertwined with the issue of possession. While the court may should be raised by the affected party in an appropriate action in the proper court. [15]
look into the evidence of title or ownership and possession de jure to determine the nature
of possession, it cannot resolve the issue of ownership because the resolution of said However, when the issue of ownership is raised the court is not ousted of its
issue would effect an adjudication on ownership which is not proper in the summary action jurisdiction. Section 16 of Rule 70 of the Rules of Court provides:
for unlawful detainer. Petitioner insists that the Court of Appeals erred in ruling that
SEC 16. Resolving defense of ownership. When the
the Huling Habilin at Testamento transmitted ownership of the specific apartments defendant raises the defense of ownership in his pleadings and the
question of possession cannot be resolved without deciding the issue of
disregarding the fact that the same is not probated yet and that the testator changed or ownership, the issue of ownership shall be resolved only to determine
the issue of possession.
revoked his will by selling the property to petitioner prior to his death.
Contrarily, respondents pray that the instant petition for review be dismissed since the Thus, all that the trial court can do is to make an initial determination of who is the owner of
resolution of the question of ownership by the MTC and the Court of Appeals was the property so that it can resolve who is entitled to its possession absent other evidence
provisional only to resolve the issue of possession. Petitioner can always avail of legal to resolve ownership.[16]But this adjudication is only provisional and does not bar or
remedies to have the issue of ownership passed upon by the proper court. Aware of the prejudice an action between the same parties involving title to the property. [17]
Civil Case No. 01-1641 to assail the validity of the deed of sale of the property and the In the case at bar, petitioners cause of action for unlawful detainer was based on
registration thereof in petitioners name. her alleged ownership of land covered by TCT No. 150431 and that she merely tolerated
The petition has merit. persons without her consent, their possession as well as those persons claiming right
under them became unlawful upon their refusal to vacate the premises and to pay the
An action for unlawful detainer exists when a person unlawfully withholds possession of rent. On the other hand, respondents assailed petitioners title by claiming that the deed of
any land or building against or from a lessor, vendor, vendee or other persons, after the sale upon which it was based was simulated and void. They insisted that they were co-
expiration or termination of the right to hold possession, by virtue of any contract, express owners thus, they have the right to possess the said property. To prove their claim, they
or implied.[12] The sole issue to be resolved is the question as to who is entitled to the
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Land Titles and Deeds (Finals) 2017
presented the Huling Habilin at Testamento of Juanito Rodriguez and the Partition that can be resolved only in Civil Case No. 01-1641, an action instituted by the
The lower courts considered the following documentary evidence in arriving at We are, thus, left with the deed of sale and the certificate of title over the property to
their respective decisions, albeit the RTC decision contradicts that of the MTC and Court of consider.
1983; 2) Deed of Sale of the property executed by Juanito Rodriguez and the petitioner on We agree with the RTC that a certificate of title is a conclusive evidence of
June 14, 1984; 3) TCT No. 150431 in the name of the petitioner; and 4) the August 23, ownership of the land described therein; the validity of which shall not be subject to a
1990 Partition Agreement executed by both the respondents and the petitioner. collateral attack, especially in an ejectment case which is summary in nature.
Based on the foregoing documentary evidence, we find that there is In Ross Rica Sales Center, Inc. v. Ong,[19] the Court held that:
have no legal effect since the will has not been probated. Before any will can have force or In Apostol v. Court of Appeals, this Court had the occasion to
clarify this:
validity it must be probated. This cannot be dispensed with and is a matter of public
. . . Under Section 48 of Presidential
policy.[18] Article 838 of the Civil Code mandates that [n]o will shall pass either real or Decree No. 1529, a certificate of title shall not be
subject to collateral attack. It cannot be altered,
personal property unless it is proved and allowed in accordance with the Rules of modified or cancelled, except in a direct proceeding
for that purpose in accordance with law. The issue
Court. As the will was not probated, the Partition Agreement which was executed pursuant of the validity of the title of the respondents can only
be assailed in an action expressly instituted for that
thereto can not be given effect. Thus, the fact that petitioner was a party to said agreement purpose. Whether or not the petitioners have the
right to claim ownership over the property is beyond
becomes immaterial in the determination of the issue of possession.
the power of the court a quo to determine in an
action for unlawful detainer.
Moreover, at the time the deed of sale was executed in favor of the petitioner,
Further, in Co v. Militar,[20] it was held that:
Juanito Rodriguez remained the owner thereof since ownership would only pass to his
heirs at the time of his death. Thus, as owner of the property, he had the absolute right to
[T]he Torrens System was adopted in this country because it was
believed to be the most effective measure to guarantee the integrity of
dispose of it during his lifetime. Now, whether or not the disposition was valid is an issue
land titles and to protect their indefeasibility once the claim of
ownership is established and recognized.
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Land Titles and Deeds (Finals) 2017
conclusive as to the issue of ownership, which is the subject matter of Civil Case No. 01- Promulgated:
1641. Our ruling that petitioner has a better right of possession was arrived at on the basis January 18, 2012
of evidence without prejudice to the eventual outcome of the annulment case, where the
issue as to who has title to the property in question is fully threshed out. As the law now
stands, in an ejectment suit, the question of ownership may be provisionally ruled upon for
DECISION
WHEREFORE, in view of the foregoing, the Decision of the Court of Appeals in CA-G.R. SERENO, J.:
SP No. 91442 dated June 27, 2006 is REVERSED and SET ASIDE. The Decision of
the Regional Trial Court ofMakati City, Branch 134, in Civil Case No. 03-517, reversing the This Petition for Review on Certiorari under Rule 45 of the Rules of Court assails the
Decision of the Metropolitan Trial Court (MTC) of Makati City, Branch 63, in Civil Case No. Decision[1] dated 08 January 2008 of the Court of Appeals (CA) in CA-G.R. SP No. 90645,
75717, is REINSTATED. which affirmed the Decision of the Regional Trial Court (RTC) of Laoag City and its
Resolution[2] dated 15 July 2008 denying the Motion for Reconsideration. The RTC, in the
SO ORDERED. exercise of its appellate jurisdiction, affirmed the Decision of the Municipal Trial Court
(MTC) of Laoag City, which had dismissed the unlawful detainer case filed by herein
petitioner.
Ruben C. Corpuz (Ruben) filed a complaint for ejectment against merely allowed by Francisco Corpuz to occupy the
Spouses Hilarion and Justa Agustin on the allegation that he is the subject properties, being his relatives, and
registered owner of two parcels of land located in Santa considering further the length of time that the
Joaquina, Laoag City covered by TCT No. 12980 issued on defendants have been in possession, as owners, of
October 29, 1976 by the Laoag City Register of Deeds and with Lot No. 20 and the 9,657 sq. m. portion of Lot No.
technical descriptions as follows: 11711, and have been continuously exercising their
rights of ownership thereon, this court is of the view
1) A parcel of land (Lot No. 20 of the Cadastral Survey and holds, in so far as this case is concerned, that
of Laoag), with improvements thereon, situated in the defendants are the ones entitled to the
the barrio of Santa Joaquina, Municipality of Laoag. possession of Lot No. 20 and the 9,657 sq. m.
Bounded x x x containing an area of five thousand portion of Lot No. 11711.
seven hundred and fifty nine (5,759) square meters
more or less x x x. WHEREFORE, premises considered, this
case, is hereby dismissed.
2) A parcel of land (Lot No. 11711 of the Cadastral
Survey of Laoag), with the improvements thereon, SO ORDERED.
situated in the barrio of Santa
Joaquina, Municipality of Laoag. Bounded x x x, On appeal, Branch XVI, Regional Trial Court of Laoag City affirmed
containing an area of twenty thousand seven said dismissal, the dispositive portion of said decision states:
hundred and forty five (20,745) square meters, more
or less x x x. WHEREFORE, premises considered, the Appeal is
hereby DISMISSED for lack of merit and the
Aforesaid parcels of land were formerly owned by Elias Duldulao in JUDGMENT of the Municipal Trial Court in Cities,
whose name Original Certificate of Title No. O-1717 was issued. Branch 01, Laoag City is hereby AFFIRMED, with
Duldulao sold said properties on August 27, 1951 to Francisco D. costs against the plaintiff-appellant.
Corpuz, father of Ruben C. Corpuz. The elder Corpuz allowed
spouses Agustin to occupy subject properties, the latter being SO ORDERED.[3]
relatives.
Ruben alleged further that he has the better right to possess the MTC, by instituting an appeal with the CA. On 08 January 2008, the appellate court
subject property having acquired the same from his father,
Francisco, who executed a Deed of Quitclaim in his favor on March through its Fourteenth Division dismissed his appeal. [4] It noted that his father engaged in
15, 1971.
a double sale when he conveyed the disputed properties to petitioner and respondents.
Spouses Agustin, in their Answer, interposed the defense that on
June 5, 1971 Francisco Corpuz, Ruben's father, disposed of The Quitclaim executed by the elder Corpuz in favor of petitioner was dated 15 March
subject property by executing a Deed of Absolute Sale in their favor
1971, while the Deed of Sale with respondents was later, on 15 June 1971; both
for a consideration of Eleven Thousand One Hundred Fifty Pesos
(P11,150.00).
documents were notarized shortly after their execution. [5] The Quitclaim, which was
The Municipal Trial Court found for the spouses Agustin and subsequently inscribed at the back of Original Certificate of Title (OCT) No. O-1717 on 29
dismissed the complaint.
October 1976,[6] resulted in the issuance of Transfer Certificate of Title (TCT) No. T-12980
In sum, considering the evidence of the defendants
which shows that they entered into and occupied Lot in the name of petitioner. The Deed of Sale executed with respondents was, however, not
No. 20 and the 9,657 sq. m. portion of Lot No.
11711 as buyers or owners, disproving the annotated at the back of OCT No. O-1717 and remained unregistered.[7]
allegation of the plaintiff that defendants were
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Land Titles and Deeds (Finals) 2017
and respondents. Due to this conveyance by the elder Corpuz to respondents, the latter's II. THE HONORABLE COURT OF APPEALS SERIOUSLY
ERRED IN THE APPRECIATION OF THE ALLEGED SALE IN
possession thereof was in the nature of ownership. Thus, in the context of an unlawful FAVOR OF RESPONDENTS TO RULE THAT THEY HAVE
BETTER RIGHT TO POSSESSION.
detainer case instituted by petitioner against respondents, the appellate court concluded
III. THE HONORABLE COURT OF APPEALS SERIOUSLY
that respondents possession of the property was not by mere tolerance of its former ERRED IN FAILING TO CONSIDER THE CASE OF JACINTO CO
VS. MILITAR, ET AL. (421 SCRA 455) WHICH IS SIMILAR TO
owner petitioner's father but was in the exercise of ownership. [8] THE INSTANT CASE.
initiate any action to annul it and oust respondents from the subject properties. [9] The
Petitioner presents to this Court for resolution the core issue of his Petition: who between
appellate court rejected his contention that, as registered owner of the disputed properties,
the parties has the right to possession of the disputed properties -- petitioner, who is the
he had a better right to possession thereof, compared to the unregistered Deed of Sale
registered owner under TCT No. T-12980; or respondents, who have a notarized yet
relied upon by respondents in their defense of the same properties. The CA ruled that the
unregistered Deed of Absolute Sale over the same properties?
inaction on his part despite knowledge of the sale in 1973 was equivalent to registration of
grounds for forcible entry or unlawful detainer; hence the complaint for ejectment must We DENY the Petition.
[11]
fail. The dispositive portion of the assailed Decision reads: Although this case does not present a novel question of law, there is a need to discuss the
WHEREFORE, in view of the foregoing, the instant petition is hereby nature of an ejectment case for the recovery of physical possession in relation to
DISMISSED. The decision of Branch
XVI, Regional Trial Court of Laoag City in Civil Case No. 13293-16 is the Torrens system. A resolution of the issue would be relevant to the determination of
hereby AFFIRMED.
who has the better right to possession in this unlawful detainer case.
SO ORDERED.[12]
One of the three kinds of action for the recovery of possession of real property is accion
interdictal, or an ejectment proceeding ... which may be either that for forcible entry
The Issues
(detentacion) or unlawful detainer (desahucio), which is a summary action for the recovery
Petitioner assigns the following errors in this Petition for Review on Certiorari:
of physical possession where the dispossession has not lasted for more than one year,
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Land Titles and Deeds (Finals) 2017
and should be brought in the proper inferior court. [14] In ejectment proceedings, the courts and not by mere tolerance of the elder Corpuz. In fact, they have been in continuous, open
resolve the basic question of who is entitled to physical possession of the premises, and notorious possession of the property for more than 30 years up to this day.
Where the parties to an ejectment case raise the issue of ownership, the courts issues identical to those of the instant case. The petitioner therein filed an unlawful
may pass upon that issue to determine who between the parties has the better right to detainer case against the respondents over a disputed property. He had a Torrens title
possess the property. However, where the issue of ownership is inseparably linked to that thereto, while the respondents as actual occupants of the property claimed ownership
of possession, adjudication of the ownership issue is not final and binding, but only for the thereof based on their unregistered Deeds of Sale. The principal issue was who between
purpose of resolving the issue of possession. The adjudication of the issue of ownership is the two parties had the better right to possess the subject property.
only provisional, and not a bar to an action between the same parties involving title to the
This Court resolved the issue by upholding the title holder as the one who had
property.[16]
the better right to possession of the disputed property based on the following justification:
In the instant case, the position of respondents is that they are occupying the disputed We have, time and again, held that the only issue for resolution in an
unlawful detainer case is physical or material possession of the
properties as owners, having acquired these from petitioner's father through a Deed of property involved, independent of any claim of ownership by any of the
party litigants. Moreover, an ejectment suit is summary in nature and is
Absolute Sale executed in 1971. Respondents believe that they cannot be dispossessed of not susceptible to circumvention by the simple expedient of asserting
ownership over the property.
the disputed properties, since they are the owners and are in actual possession thereof up
In forcible entry and unlawful detainer cases, even if the
to this date. Petitioner, however, rebuts this claim of ownership, contending that he has defendant raises the question of ownership in his pleadings and the
question of possession cannot be resolved without deciding the issue
registered the disputed properties in his name and has been issued a land title under of ownership, the lower courts and the Court of Appeals, nonetheless,
have the undoubted competence to provisionally resolve the issue of
the Torrens system. He asserts that, having registered the properties in his name, he is the ownership for the sole purpose of determining the issue of Possession.
recognized owner and consequently has the better right to possession. Such decision, however, does not bind the title or affect the
ownership of the land nor is conclusive of the facts therein found in a
case between the same parties upon a different cause of action
Indeed, a title issued under the Torrens system is entitled to all the attributes of property involving possession.
ownership, which necessarily includes possession. [17] Petitioner is correct that as In the instant case, the evidence showed that as between the
parties, it is the petitioner who has a Torrens Title to the property.
a Torrens title holder over the subject properties, he is the rightful owner and is entitled to Respondents merely showed their unregistered deeds of sale in
support of their claims. The Metropolitan Trial Court correctly relied on
possession thereof. However, the lower courts and the appellate court consistently found the transfer certificate of title in the name of petitioner.
that possession of the disputed properties by respondents was in the nature of ownership, In Tenio-Obsequio v. Court of Appeals, it was held that the
Torrens System was adopted in this country because it was believed to
be the most effective measure to guarantee the integrity of land titles
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
and to protect their indefeasibility once the claim of ownership is In the present case, petitioner opted to file an ejectment case
established and recognized. against respondents. Ejectment casesforcible entry and unlawful
detainerare summary proceedings designed to provide expeditious
It is settled that a Torrens Certificate of title is indefeasible means to protect actual possession or the right to possession of the
and binding upon the whole world unless and until it has been nullified property involved. The only question that the courts resolve in
by a court of competent jurisdiction. Under existing statutory and ejectment proceedings is: who is entitled to the physical possession of
decisional law, the power to pass upon the validity of such certificate of the premises, that is, to the possession de facto and not to the
title at the first instance properly belongs to the Regional Trial Courts in possession de jure. It does not even matter if a partys title to the
a direct proceeding for cancellation of title. property is questionable. For this reason, an ejectment case will not
necessarily be decided in favor of one who has presented proof
As the registered owner, petitioner had a right to the of ownership of the subject property. Key jurisdictional facts
possession of the property, which is one of the attributes of his constitutive of the particular ejectment case filed must be averred in
ownership. Respondents' argument that petitioner is not an innocent the complaint and sufficiently proven.
purchaser for value and was guilty of bad faith in having the subject
The statements in the complaint that respondents possession
land registered in his name is a collateral attack on the title of
of the building was by mere tolerance of petitioner clearly make out a
petitioner, which is not allowed. A certificate of title cannot be subject
case for unlawful detainer. Unlawful detainer involves the persons
to a collateral attack and can be altered, modified or cancelled only in a
withholding from another of the possession of the real property to
direct proceeding in accordance with law. [19]
which the latter is entitled, after the expiration or termination of the
formers right to hold possession under the contract, either expressed
or implied.
The pronouncement in Co v. Militar was later reiterated in Spouses Pascual v. A requisite for a valid cause of action in an unlawful detainer
[20] [21]
case is that possession must be originally lawful, and such possession
Spouses Coronel and in Spouses Barias v. Heirs of Bartolome Boneo, et al., wherein must have turned unlawful only upon the expiration of the right to
possess. It must be shown that the possession was initially lawful;
we consistently held the age-old rule that the person who has a Torrens Title over a land hence, the basis of such lawful possession must be established. If, as
in this case, the claim is that such possession is by mere tolerance of
is entitled to possession thereof.[22] the plaintiff, the acts of tolerance must be proved. (Emphasis supplied.)
However, we cannot lose sight of the fact that the present petitioner has instituted an
In this case, petitioner has not proven that respondents continued possession of
unlawful detainer case against respondents. It is an established fact that for more than
the subject properties was by mere tolerance of his father, except by a mere allegation
three decades, the latter have been in continuous possession of the subject property,
thereof. In fact, petitioner has not established when respondents possession of the
which, as such, is in the concept of ownership and not by mere tolerance of petitioners
properties became unlawful a requisite for a valid cause of action in an unlawful detainer
father. Under these circumstances, petitioner cannot simply oust respondents from
case.
possession through the summary procedure of an ejectment proceeding.
are summary in nature. The complaint must show enough on its face to
give the court jurisdiction without resort to parol evidence. We concur in the appellate courts findings that petitioners father engaged in a
Unlawful detainer is an action to recover possession of real double sale of the disputed properties. The records of the case show that it took petitioner
property from one who illegally withholds possession after the
expiration or termination of his right to hold possession under any more or less five years from 1971 when he acquired the property from his father to 1976
contract, express or implied. The possession of the defendant in
unlawful detainer is originally legal but became illegal due to the when petitioner registered the conveyance and caused the issuance of the land title
expiration or termination of the right to possess.
registered in his name under the Torrens system. Respondents, on the other hand,
An unlawful detainer proceeding is summary in nature,
jurisdiction of which lies in the proper municipal trial court or continued their possession of the properties, but without bothering to register them or to
metropolitan trial court. The action must be brought within one year
from the date of last demand and the issue in said case is the right to initiate any action to fortify their ownership.
physical possession.
... ... ... We cannot, however, sustain the appellate courts conclusion that petitioner's
In Cabrera v. Getaruela, the Court held that a complaint sufficiently
alleges a cause of action for unlawful detainer if it recites the following: failure to initiate any action to annul the sale to respondents and oust them from the
(1) initially, possession of property by the defendant was by disputed properties had the effect of registration of respondents unregistered Deed of
contract with or by tolerance of the plaintiff; [25]
Absolute Sale. We held thus in Ruiz, Sr. v. Court of Appeals :
(2) eventually, such possession became illegal upon notice
by plaintiff to defendant of the termination of the latters (But) where a party has knowledge of a prior existing interest
right of possession; which is unregistered at that time he acquired a right to the same
land, his knowledge of that prior unregistered interest has the
(3) thereafter, the defendant remained in possession of the effect of registration as to him. Knowledge of an unregistered sale is
property and deprived the plaintiff of the enjoyment equivalent to registration. As held in Fernandez v. Court of
thereof; and Appeals [189 SCRA 780 (1990)],
(4) within one year from the last demand on defendant to Section 50 of Act No. 496 (now Sec. 51 of
vacate the property, the plaintiff instituted the complaint P.D. 1529), provides that the registration of the deed
for ejectment. is the operative act to bind or affect the land insofar
as third persons are concerned. But where the party
has knowledge of a prior existing interest which is
unregistered at the time he acquired a right to the
Based on the above, it is obvious that petitioner has not complied with the same land, his knowledge of that prior unregistered
interest has the effect of registration as to him. The
requirements sufficient to warrant the success of his unlawful detainer Complaint against Torrens system cannot be used as a shield for the
commission of fraud (Gustillo v. Maravilla, 48 Phil.
respondents. The lower courts and the CA have consistently upheld the entitlement of 442). [Emphasis supplied.]
respondents to continued possession of the subject properties, since their possession has
been established as one in the concept of ownership. Thus, the courts correctly dismissed In this case, the Quitclaim executed by the elder Corpuz in favor of petitioner
the unlawful detainer case of petitioner. was executed ahead of the Deed of Sale of respondents. Thus, the sale of the subject
We resolve the petition for review on certiorari filed by petitioner Teresa Tuazon
It is settled in jurisprudence that a Torrens certificate of title cannot be the (Teresa) to challenge the October 28, 2009 Decision and February 11, 2010 Resolution of
the Court of Appeals in CA-G.R. SP No. 107937, penned by Associate Justice Marlene
subject of collateral attack.[27] Such attack must be direct and not by a collateral Gonzales-Sison with Associate Justices Andres B. Reyes, Jr. and Vicente S.E. Veloso,
concurring.
proceeding.[28] It is a well-established doctrine that the title represented by the certificate
The Facts
cannot be changed, altered, modified, enlarged, or diminished in a collateral
During their lifetime, spouses Melencio Diaz and Dolores Gulay (Dolores) owned Lot 103
proceeding.[29] Considering that this is an unlawful detainer case wherein the sole issue to of the Santa Rosa Estate, Barangay Aplaya, Sta. Rosa, Laguna, consisting of 499 square
meters (Lot 103). They had three daughters named Maria, Paciencia, and Esperanza.
be decided is possession de facto rather than possession de jure, a collateral attack by Melencio and Maria predeceased Dolores. On May 28, 1955, Dolores, Paciencia, and
Esperanza adjudicated Lot 103 to Dolores through a Deed of Extrajudicial Settlement.
herein respondents on petitioner's title is proscribed. Maria's children who were still minors at that time were not included in the settlement.
On March 17, 1956, Dolores sold Lot 103 to Isabel Torres through a Bilihang
Our ruling in the present case is only to resolve the issue of who has the better Tuluyan (Deed of Absolute Sale). Subsequently, Isabel Torres sold Lot 103 to Teresa on
September 29, 1973.
right to possession in relation to the issue of disputed ownership of the subject properties.
On October 12, 1973, Maria's children, namely Gloria, Angel, Felix, and Flaviano, all
Questions as to the validity of petitioner's Torrens title can be ventilated in a proper suit surnamed Isagon, executed a Deed of Conformity. In this instrument, they honored the
Deed of Extrajudicial Settlement executed by their grandmother and aunts, subject to the
instituted to directly attack its validity, an issue that we cannot resolve definitively in this condition that they would get one-sixth of Lot 103 as their share.
unlawful detainer case.
Gloria, Felix, and Flaviano also sold their.shares to Teresa. On the other hand, Angel
mortgaged his share to Teresa on October 20, 1975, through a Kasulatan ng Sanglaan.
His share consisted of 20.75 square meters which was one-fourth of the one-sixth share in
WHEREFORE, in view of the foregoing, we deny the instant Petition for lack of the property. Angel Isagon thereafter refused and failed to redeem the mortgaged
property.
merit. The Decisions of the Court of Appeals in CA-G.R. SP No. 90645 (dated January 08,
Teresa has been paying the real estate taxes due on Lot 103 since 1974 up to the present.
2008), of the Regional Trial Court of Laoag City in Civil Case No. 3111-13293-65, as well Lot 103 is covered by an undated and reconstituted Transfer Certificate of Title (TCT)
No. (N.A.) RT-1925 issued in Teresa's name.
as of the Municipal Trial Court of Laoag City in Civil Case No. 3111 -- all dismissing the
Sometime in 1972, the petitioner's brother, Antonio Tuazon (Antonio), allowed Spouses
unlawful detainer case of petitioner are AFFIRMED.
Angel and Marcosa Isagon (respondents) to build a small hut on a portion of Lot 103
without Teresa's knowledge. The respondents and their children were then living by the
seashore and Antonio feared that their house could be swept away by the floods during a
We make no pronouncements as to attorney's fees for lack of evidence. SO typhoon.
ORDERED.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
In 2000, the respondents started to construct a house on the disputed property despite She adds that the only issue in an unlawful detainer case is the physical possession of the
Teresa's protest. For years, however, Teresa tolerated their possession and use of the property. As the registered owner, she has the right to enjoy all the rights of an owner
contested area. under Articles 428 and 429 of the Civil Code, including actual possession.
In 2007, Teresa filed a complaint against the respondents before the Lupon Our Ruling
Tagapamayapa of Barangay Aplaya. The parties failed to reach any amicable settlement.
On January 24, 2007, Teresa sent a final demand letter to respondents to vacate and to We grant the petition.
pay rental fees. The respondents did not reply.
The sole issue here is who has the better right of physical possession between the
On September 11, 2007, Teresa filed a complaint for unlawful detainer against the registered owner as shown in the certificate of title and the mortgagor as shown in
respondents before the Municipal Trial Court in Cities (MTCC), City of Sta. Rosa, Laguna. the Kasulatan ng Sanglaan.
She prayed that the respondents be ordered to vacate the subject property and to pay
compensation for its use and occupancy. While the CA is correct that a mortgage does not transfer ownership, the indefeasibility of
a Torrens title should have been given primary consideration.
In their answer, the respondents alleged that they were occupying the subject property as
owners. They also alleged that Teresa fraudulently obtained TCT No. (N.A.) RT-1925. An action for unlawful detainer is summary in nature and cannot be delayed by a mere
assertion of ownership as a defense.1 When the parties to an ejectment case raise the
The MTCC and RTC Rulings issue of ownership, the court may pass upon that issue only if needed to determine who
between the parties has a better right to possess the property.2 Furthermore, the
The MTCC, in its judgment on January 25, 2008, decided in favor of Teresa and ordered adjudication on the issue of ownership is only provisional, 3 and subject to a separate
the respondents to vacate the subject property and to pay reasonable rent and attorney's proceeding that the parties may initiate to settle the issue of ownership.
fees. The MTCC held that Teresa was the owner of the property as shown by TCT No.
(N.A.) RT-1925, and as owner, she was entitled to enjoy the right of possession over the A person who possesses a title issued under the Torrens system is entitled to all the
subject property. It added that a property registered under the Torrens system could not be attributes of ownership including possession. 4 A certificate of title cannot be subject to a
collaterally attacked in an action for unlawful retainer. collateral attack in an action for unlawful detainer. A collateral attack is made when, in an
action to obtain a different relief, the validity of a certificate of title is questioned. 5
On appeal, the Regional Trial Court (RTC) in Bifian, Laguna, affirmed in toto the decision
of the MTCC. The RTC denied the respondents' motion for reconsideration. In the present case, the respondents alleged in their answer that the certificate of title
issued in the name of Teresa was fraudulently obtained. This defense constitutes a
The CA Ruling collateral attack on the title and should not therefore be entertained. To directly assail the
validity of TCT No. (N.A.) RT-1925, a direct action for reconveyance must be filed. 6
The respondents appealed the RTC's ruling to the CA. In the present case, based on the certificate of title, Teresa is the owner of the subject
property and is entitled to its physical possession.
In its October 28, 2009 Decision, the CA reversed the RTC's ruling. The CA noted that
Angel Isagon executed a real estate mortgage in favor of Teresa over a portion of Lot 103 WHEREFORE, we hereby GRANT the petition for review on certiorari. The Decision dated
but had failed to redeem it. Citing Article 2088 of the Civil Code, the CA concluded that October 28, 2009, and the Resolution dated February 11, 2010, of the Court of Appeals in
Teresa was a mere mortgagee and had no right to eject the respondents. Instead of CA-G.R. SP No. 107937 are hereby REVERSED and SET ASIDE. The decision dated
foreclosing the property, Teresa filed this action for unlawful detainer. The CA added that a October 15, 2008, of Branch 25 of the Regional Trial Court, Bian, Laguna, in Civil Case
mortgage was not an instrument that transferred ownership; thus, the disputed property No. B-7472, is hereby REINSTATED.
still belonged to the respondents.
SO ORDERED.
The Petition
Teresa's present petition for review on certiorari argues that she is the registered owner,
not a mere mortgagee, of the property as shown by TCT No. (N.A.) RT-1925. Section 51 of
Presidential Decree No. 1929 expressly states that registration is the operative act that
conveys registered land. Thus, the TCT is the best proof of ownership.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
UDK No. 7671 June 23, 1988 whether the certificate of sale could be registered using the old Entry No. 8191 made in
1980 notwithstanding the fact that the original copies of the reconstituted certificates of title
DEVELOPMENT BANK OF THE PHILIPPINES, registrant-appellant, were issued only on June 19, 1984; and (b) if the first query was answered affirmatively,
whether he could sign the proposed annotation, having assumed his duties only in July
vs.
THE ACTING REGISTER DEEDS OF NUEVA ECIJA, respondent-appellee. 1982.5
The resolution on the consulta held that Entry No. 8191 had been rendered "... ineffective
due to the impossibility of accomplishing registration at the time the document was entered
because of the non-availability of the certificate (sic) of title involved. For said certificate of
NARVASA, J.: sale to be admitted for registration, there is a need for it to be re-entered now that the titles
have been reconstituted upon payment of new entry fees," and by-passed the second
This case, rather cut-and-dried as far as factual background is concerned, turns upon a query as having been rendered moot and academic by the answer to the first. 6
determination of the true meaning and intendment of Section 56 of Presidential Decree No.
1529, 1 which in part reads: Unwilling to accept that result, the DBP appealed the resolution to the Court of Appeals
(then the Intermediate Appellate Court) 7 which, after reviewing the record, certified the
Sec. 56. Primary Entry Book; fees, certified copies. Each Register of appeal to this Court as involving a question purely of law. 8
Deeds shall keep a primary entry book in which, upon payment of the
entry fee, he shall enter, in the order of their reception, all instruments The appealed resolution appears to be based upon a reading of the cited Section 56 of PD
including copies of writs and processes filed with him relating to No. 1529, and particularly of the provision therein referring to the Register's act of making
registered land. He shall, as a preliminary process in registration, note a primary entry as " ... a preliminary process in registration ...," as depriving of any effect a
in such book the date, hour and minute of reception of all instruments, primary entry without a corresponding annotation thereof on the certificate of title to which
in the order in which they were received. They shall be regarded as the instrument subject of said entry refers.
registered from the time so noted, and the memorandum of each
instrument, when made on the certificate of title to which it refers, shall
bear the same date: Provided, that the national government as well as That view fails to find support from a consideration of entire context of said Section 56
the provincial and city governments shall be exempt from the payment which in another part also provides that the instrument subject of a primary entry "... shall
of such fees in advance in order to be entitled to entry and registration. be regarded as registered from the time so noted ...," and, at the very least, gives such
entry from the moment of its making the effect of putting the whole world on notice of the
existence the instrument on entered. Such effect (of registration) clearly attaches to the
xxx xxx xxx mere making of the entry without regard to the subsequent step of annotating a
memorandum of the instrument subject of the entry on the certificate of title to which it
The facts are few and undisputed. On June 13, 1980, the Development Bank of the refers. Indeed, said Section, in also providing that the annotation, "... when made ... shall
Philippines (hereafter, DBP) presented for registration to the Register of Deeds of Nueva bear the same date ..." as the entry, may be said to contemplate unspecified intervals of
Ecija, Cabanatuan City, a sheriff's certificate of sale in its favor of two parcels of land time occurring between the making of a primary entry and that of the corresponding
covered by Transfer Certificates of Title Nos. NT-149033 and NT-149034, both in the annotation on the certificate of title without robbing the entry of the effect of being
names of the spouses Andres Bautista and Marcelina Calison, which said institution had equivalent to registration. Neither, therefore, is the implication in the appealed resolution
acquired as the highest bidder at an extrajudicial foreclosure sale. The transaction was that annotation must annotation entry immediately or in short order justified by the
entered as Entry No. 8191 in the Registry's Primary Entry Book and DBP paid the requisite language of Section 56.
registration fees on the same day. Annotation of the sale on the covering certificates of title
could not, however be effected because the originals of those certificates were found to be Furthermore, it is amply clear that the four-year hiatus between primary entry and
missing from the files of the Registry, where they were supposed to be kept, and could not proposed annotation in this case has not been of DBP's making. Though it was under no
be located. 2 On the advice of the Register of Deeds, DBP instituted proceedings in the necessity to present the owner's duplicates of the certificates of title affected for purposes
Court of First Instance of Nueva Ecija to reconstitute said certificates, and reconstitution of primary entry, since the transaction sought to be recorded was an involuntary
was ordered by that court in a decision rendered on June 15, 1982. 3 For reasons not transaction, 9 and the record is silent as to whether it presented them or not, there is
apparent on the record, the certificates of title were reconstituted only on June 19,1984. 4 nonetheless every probability that it did so. It was the mortgagee of the lands covered by
those titles and it is usual in mortgage transactions that the owner's duplicates of the
On June 25, 1984, DBP sought annotation on the reconstituted titles of the certificate of encumbered titles are yielded into the custody of the mortgage until the mortgage is
sale subject of Entry No. 8191 on the basis of that same four-year-old entry. The Acting discharged. Moreover, the certificates of title were reconstituted from the owner's
Register of Deeds, being in doubt of the proper action to take on the solicitation, took the duplicates, 10 and again it is to be presumed that said duplicates were presented by DBP,
matter to the Commissioner of Land Registration by consulta raising two questions: (a) the petitioner in the reconstitution proceedings.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
It is, furthermore, admitted that the requisite registration fees were fully paid and that the The decision in Villasor also quoted with approval the following excerpt from an earlier
certificate of sale was registrable on its face. 11 DBP, therefore, complied with all that was case, Philippine National Bank vs. Fernandez. 16
required of it for purposes of both primary entry and annotation of the certificate of sale. It
cannot be blamed that annotation could not be made contemporaneously with the entry
Coming now to the second ground on which the appellant bases his
because the originals of the subject certificates of title were missing and could not be claims, we find that when Simona Fausa executed the document,
found, since it had nothing to do with their safekeeping. If anyone was responsible for Exhibit 3, on October 17, 1928, conveying her interest in the land to the
failure of annotation, it was the Register of Deeds who was chargeable with the keeping appellant, her interest therein had already been attached by the
and custody of those documents. provincial sheriff and also by him at public auction to the Philippine
National Bank, and the certificate of sale filed in the office of the
It does not, therefore, make sense to require DBP to repeat the process of primary entry, register of deeds in accordance with the law (sections 429 and 450 of
paying anew the entry fees as the appealed resolution disposes, in order to procure the Code of Civil Procedure). It was not necessary for the sheriff to
annotation which through no fault on its part, had to be deferred until the originals of the present the owner's duplicate of the certificate of title when he filed
certificates of title were found or reconstituted. That it is hardly just or equitable to do so notice of attachment with the register of deeds, nor was it necessary for
also seems to have occurred to the Solicitor General, who dilutes his argument in support the Philippine National Bank to present the owner's duplicate when the
of the appealed resolution with the suggestion that "... the making of a new entry ... would bank filed its certificate of sale for registration (sections 71 and 72 of
be the more orderly procedure," and that DBP should not be made to pay filing fees Act No. 496).
anew.12
Later cases appear to have applied the Aballe ruling that entry in the day book, even
Jurisprudence on the subject, while it has not been entirely consistent, is not wanting. without the corresponding annotation on the certificate of title, is equivalent to, or produces
In Government vs. Aballe, 13this Court ruled that " ... (a)lthough a notice of attachment has the effect of, registration to voluntary transactions, provided the requisite fees are paid and
not been noted on the certificate of title, its notation in the book of entry of the register of the owner's duplicates of the certificates of title affected are presented. Thus, in Levin vs.
deeds produces all the effects which the law gives to its registration or inscription." Bass, et al., 17 it was held:
Seemingly, that ruling was abandoned in the wartime case of Basa vs. De la
Rama, 14 where it was held that the entry of an instrument in the primary entry book ... Under the Torrens system the act of registration is the operative act
produces no legal effect unless a memorandum thereof is noted on the certificate of to convey and affect the land. Do the entry in the day book of a deed of
title. Villasor vs. Camon, 15 however, clarified that Aballe was never really abandoned or sale which was presented and filed together with owner's duplicate
reversed insofar as it applied to involuntary transactions. Said the Court in that case, which certificate of title which the office of the Registrar of Deeds and full
involved a voluntary transactions a deed of assignment of rights in a parcel of land and payment of registration fees constitute a complete act of registration
its improvements: which operates to convey and affect the land? In voluntary registration,
such as a sale, mortgage, lease and the like, if the owner's duplicate
The appellant cannot invoke in support of her contention, the ruling laid certificate be not surrendered and presented or if no payment of
down in the case of Government of the Philippine Islands vs. Aballe, 60 registration fees be made within 15 days, entry in the day book of the
Phil., 986, which was followed in Director of Lands vs. Abad, 61 Phil. deed of sale does not operate to convey and affect the land sold. In
479, to the effect that an attachment entered upon the entry book is involuntary registration, such as an attachment, levy upon execution, lis
duly registered although the duplicate certificate is not presented at the pendens and the like entry thereof in the day book is a sufficient notice
time of registration to the register of deeds. Appellant cannot invoked to all persons of such adverse claim. ... The pronouncement of the
said ruling, not because it has been abandoned by the Supreme Court court below is to the effect that an innocent purchaser for value has no
during the Japanese occupation in the case of Bass VS. De la Rama, et right to the property because he is not a holder of a certificate of title to
al., ... in which it was said that "we are constrained to abandon the such property acquired by him for value and in good faith. It amounts to
ruling in said two cases,"- it was not abandoned for the decision was holding that for failure of the Registrar of Deeds to comply and perform
concurred by only two justices or less than a majority, and said his duty, an innocent purchaser for value loses that character-he is not
statement was not necessary or an obiter dictum and against the law, an "innocent holder for value of a certificate of title." ... Neither violence
as correctly stated by the two associate justices who dissented and to, nor stretching of the meaning of, the law would be done, if we
only concurred in the result, but because said ruling, subsisting and in should hold that an innocent purchaser for value of registered land
force, does not support appellant's contention, for it is only applicable to becomes the registered owner and in contemplation of law the holder of
registration of involuntary instruments, such as attachment, or other a certificate thereof the moment he presents the owner's duplicate
liens and adverse claims of any description. This ruling is correct or in certificate of title to the property sold and pays the full amount of
conformity with the provisions of section 72 of Act No. 496, which do registration fees, because what remains to be done lies not within his
not require the production by the registrant of the duplicate certificate of power to perform. The Registrar of Deeds is in duty bound to perform it.
the land to be affected, ... (emphasis supplied) We believe that is a reasonable and practical interpretation of the law
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
under considerations-a construction which would lead to no The qualms implicit in the query of the respondent (and present appellee) register of deeds
inconsistency and injustice. (emphasis supplied) about making annotation of an entry effected before he assumed that office are more
imagined than real. He would only be making a memorandum of an instrument and of its
entry based on or reciting details which are already of indubitable record and, pursuant to
A similar ruling was made in Potenciano vs. Dineros, et al., 18 concerning land a deed of
sale of which was entered in the day book upon payment of the corresponding fees and the express command of the law, giving said memorandum the same date as the entry. No
presentation of the owner's duplicate of the covering certificate of title, on November 4, part of that function is exclusive to the incumbent of the office at the time entry was made
1944. However, due to the confusion arising from the bombing of Manila (this having or is forbidden to any of his successors.
happened during the final months of the Japanese Occupation), the papers presented by
the registrant were either lost or destroyed, no certificate of title was issued to him and as WHEREFORE, the appealed resolution of the Acting Commissioner of Land Registration is
far as the records of the Register of Deeds showed, the property remained in the name of SET ASIDE. The respondent-appellee Register of Deeds of Nueva Ecija, or his successor,
the vendor. Another party later sued the vendor, obtained judgment against him and is ordered to annotate on the originals of the reconstituted Transfer Certificates of Title
purchased the property on execution sale. In affirming judgment annulling the execution Nos. NT-149033 and NT-149034 of his Registry a memorandum of the certificate of sale in
sale in an action brought by the original purchaser, this Court held: favor of appellant Development Bank of the Philippines as entered under Entry No. 8191
dated June 13, 1980 of the Primary Entry (Day) Book of said Registry. No pronouncement
The judgment creditor contends that entry of the deed in the day book as to costs.
is not sufficient registration. Both upon law and authority this contention
must be rejected. Section 56 of the Land Registration Act says that SO ORDERED.
deeds relating to registered land shall, upon payment of the filing fees,
be entered in the entry book also called day book in the same
section with notation of the year, month, day, hour, and minute of
their reception and that "they shall be regarded as registered from the
moment so noted." And applying this provision in the cases of Levin vs.
Bass, etc., G.R. Nos. L-4340 to 4346, decided on May 28, 1952, this
Court held that "an innocent purchaser for value of registered land
becomes the registered owner and in contemplation of law the holder of
a certificate thereof the moment he presents and files a duly notarized
and lawful deed of sale and the same is entered on the day book and at
the same time he surrenders or presents the owner's duplicate
certificate of title to the property sold and pays the full amount of
registration fees, because what remains to be done lies not within his
power to perform."
Current doctrine thus seems to be that entry alone produces the effect of registration,
whether the transaction entered is a voluntary or an involuntary one, so long as the
registrant has complied with all that is required of him for purposes of entry and annotation,
and nothing more remains to be done but a duty incumbent solely on the register of deeds.
Therefore, without necessarily holding that annotation of a primary entry on the original of
the certificate of title may be deferred indefinitely without prejudice to the legal effect of
said entry, the Court rules that in the particular situation here obtaining, annotation of the
disputed entry on the reconstituted originals of the certificates of title to which it refers is
entirely proper and justified. To hold said entry "ineffective," as does the appealed
resolution, amounts to declaring that it did not, and does not, protect the registrant (DBP)
from claims arising, or transactions made, thereafter which are adverse to or in derogation
of the rights created or conveyed by the transaction thus entered. That, surely, is a result
that is neither just nor can, by any reasonable interpretation of Section 56 of PD 1529, be
asserted as warranted by its terms.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Petitioner, Present:
On April 19, 1983, spouses Augusto and Luz Basa loaned from NHA the amount
PUNO, C.J.,
of P556,827.10 secured by a real estate mortgage over their properties covered by
Chairperson,
Transfer Certificates of Title (TCTs) Nos. 287008 and 285413, located at No. 30 San
*
CARPIO, Antonio St., San Francisco del Monte, Quezon City.[2] Spouses Basa did not pay the loan
- versus -
LEONARDO-DE CASTRO, despite repeated demands. To collect its credit, the NHA, on August 9, 1990, filed a
BERSAMIN, and verified petition for extrajudicial foreclosure of mortgage before the Sheriffs Office
burned down when a fire gutted the City Hall of Quezon City on June 11, 1988.[5]
DECISION
On April 16, 1992, the redemption period expired, [6] without respondents having redeemed
the properties. Shortly thereafter, on April 24, 1992, NHA executed an Affidavit of
LEONARDO-DE CASTRO, J.: Consolidation of Ownership[7]over the foreclosed properties, and the same was inscribed
by the Register of Deeds on the certificates of title in the hand of NHA under Entry No.
6572/T-287008-PR-29207.[8]
This Petition for Review on Certiorari under Rule 45 of the Rules of Court seeks
to set aside the Amended Decision[1] of the Court of Appeals dated November 27,
2000 and its Resolution dated July 19, 2001 denying the motion for reconsideration of the
On June 18, 1992, NHA filed a petition for the issuance of a Writ of Possession. The said registrar.[17] Since the sheriffs certificate was only inscribed on the owners duplicate
petition was granted by the Regional Trial Court (RTC) in an Order [9] dated August 4, 1992. certificate of title, and not on the certificate of title in the possession of the Register of
Deeds, then there was no effective registration and the one-year redemption period had
not even begun to run. Thus, respondents asked the RTC, among others, to declare the
A Writ of Possession[10] was issued on March 9, 1993 by the RTC, ordering spouses foreclosure sale null and void, to allow the respondents to redeem the mortgaged
Augusto and Luz Basa to vacate the subject lots. The writ, however, remained properties in the amount of P21,160.00, and to cancel the Writ of Possession dated March
unserved. This compelled NHA to move for the issuance of an alias writ of possession 9, 1993.
NHA opposed respondents petition for intervention.[18] It countered that the extrajudicial
Before the RTC could resolve the motion for the issuance of an alias writ of possession, foreclosure sale was conducted validly and made in accordance with Act No. 3135 as
respondents spouses Basa and Eduardo Basa, on June 2, 1993, filed a Motion for Leave evidenced by the publication of the Notice of Sheriffs Sale in the Manila Times in its issues
to Intervene and Petition in Intervention (with Prayer for Temporary Restraining Order dated July 14, 21 and 28, 1990.[19] NHA also said that respondents had been furnished
and/or Writ of Preliminary Injunction).[11] Respondents anchored said petition for with a copy of the Notice of Sheriffs Sale as shown at the bottom portion of said
intervention on Section 8[12] of Act No. 3135, as amended, which gives the notice.[20] NHA maintained that respondents right of redemption had long expired on April
debtor/mortgagor the remedy to petition that the sale be set aside and the writ of 15, 1992 since the certificate of sale was inscribed on their TCT Nos. 285413 and 287008
possession be cancelled. In the said petition for intervention, respondents averred that the a year earlier, or on April 16, 1991. It pointed out that the RTC, via its Order dated August
extrajudicial foreclosure of the subject properties was a nullity since notices were not 4, 1992, had already ruled that respondents right of redemption was already gone without
posted and published, written notices of foreclosure were not given to them, and notices of them exercising said right.Since said order had already attained finality, the ruling therein
sale were not tendered to the occupants of the sold properties, thereby denying them the could no longer be disturbed.
assuming arguendo that the foreclosure sale were valid, they were still entitled to redeem
the same since the one-year redemption period from the registration of the sheriffs On January 2, 1995, the RTC issued the first assailed Order [21] with the following
certificate of foreclosure sale had not yet prescribed. [14] Citing Bernardez v. directives: 1) granting the issuance of the alias writ of possession which allowed NHA to
Reyes[15] and Bass v. De la Rama,[16]respondents theorized that the instrument is deemed take possession of the subject properties; 2) admitting the Petition in Intervention and
registered only upon actual inscription on the certificate of title in the custody of the civil treating the same as the petition to set aside sale mentioned in [Sec. 8] of Act No. 3155;
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
and 3) granting the issuance of a Writ of Preliminary Injunction in favor of respondents that argued that respondents should have assailed the foreclosure sale during the hearing in
ordered NHA to refrain from selling or disposing of the contested properties. The pertinent the petition for the issuance of a Writ of Possession, and not during the hearing in the
portion of the order reads: petition for the issuance of an alias writ of possession since the petition referred to in
Section 8 of Act No. 3135 pertains to the original petition for the issuance of the Writ of
Possession and not the Motion for the Issuance of an Alias Writ of Possession. NHA
After examining the record and following precedents x x x this Court
hereby orders: stressed that another reason why the petition for intervention should be denied was the
finality of the Order dated August 4, 1992 declaring respondents right of redemption barred
by prescription. Lastly, NHA asserted that the writ of possession was issued as a matter of
1. The issuance of an alias writ of possession;
course upon filing of the proper motion and thereby, the court was bereft of discretion.
2. Admission of the Petition in Intervention, treating the same In the second assailed Order[24] dated September 4, 1995, the RTC denied NHAs motion
as the petition to set aside sale, etc., mentioned in [Sec. 8] of Act No.
for reconsideration reasoning that the admission of the intervention was sanctioned by
3155;
Section 8 of Act No. 3135. As to the grant of preliminary injunction, the RTC made the
justification that if the NHA was not restrained, the judgment which may be favorable to
3. The issuance of a writ of preliminary injunction, after a
BOND in the amount of P20,000.00 had been duly filed by intervenors, respondents would be ineffectual. The order partly provides:
ordering movant National Housing Authority, its agents and/or any other
person acting under its command, to desist and refrain from selling or in
any manner from disposing of the subject properties covered by TCT
Nos. 287008 and 285413 and located at No. 30, San Antonio Street, The motion is without merit. The admission of the intervention is
San Francisco del Monte, Quezon City, pending the termination of this sanctioned by Sec. 8 of Act No. 3135. And, because, otherwise or if no
proceeding and/or unless a contrary order is issued by this Court; preliminary injunction is issued, the movant NHA may, before final
judgment, do or continue the doing of the act with the intervenor asks
the court to restrain, and thus make ineffectual the final judgment
rendered afterwards which may grant the relief sought by the
4. Setting the hearing of the petition in intervention (to set intervenor.
aside) on March 17, 1995, at 8:30 a.m.[22]
NHA filed a motion for reconsideration[23] assailing the RTCs Order insofar as it admitted
respondents motion for intervention and issued a writ of preliminary injunction. NHA
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Land Titles and Deeds (Finals) 2017
Undaunted, NHA filed on November 24, 1995, a special civil action for certiorari and sale is to question the validity of the sale through a petition to set aside the sale and to
prohibition before the Court of Appeals. cancel the writ of possession, a summary procedure provided for under Section 112 of the
Land Registration Act. It also observed that the grant of the preliminary injunction by the
RTC was uncalled for as it would effectively defeat the right of NHA to possession, the
The Court of Appeals rendered a Decision[26] dated February 24, 2000, in favor of the latter having been entitled by virtue of the grant of the alias writ of possession.
NHA. It declared null and void the assailed orders of the RTC dated January 2,
Respondents filed a motion for reconsideration. [28] They alleged that since they raised the
1995 and September 4, 1995, to the extent that the said orders admitted the petition in
issue that their right of redemption had not prescribed, said fact should have changed the
intervention and granted the issuance of the preliminary injunction; but it upheld the grant
whole scenario such that the issuance of a writ of possession ceased to be summary in
of the alias writ of possession, thus:
nature and was no longer ministerial. Respondents then concluded that their right to
redeem the properties against NHAs right to the writ of possession must be threshed out in
WHEREFORE, the petition is GRANTED, and the assailed a hearing of the case on its merits.
order of January 2, 1995 is declared NULL AND VOID except for the
portion directing the issuance of an alias writ of possession. Likewise
declared NULL AND VOID is the second assailed order of September
4, 1995 denying the petitioners motion for reconsideration. Let an alias
writ of possession be issued and executed/implemented by the public With regard to the RTC Order dated August 4, 1992 granting the writ of possession which,
respondent without further delay.[27]
according to the NHA, became final and executory, respondents argued that said order did
not constitute res judicataso as to bar the filing of the petition for intervention since the said
order was not a judgment on the merits that could attain finality.
The Court of Appeals defended its affirmation of the RTCs grant of the alias writ of
possession in NHAs favor by saying that it was a necessary consequence after the earlier
writ was left unserved to the party.It further explained that NHA was entitled to the writ of
Also, respondents would like the Court of Appeals to treat the petition for intervention not
possession as a matter of course after the lapse of the redemption period.
only as an opposition to the issuance of the alias writ of possession, but also as a proper
remedy under Section 8 of Act No. 3135, as amended, in view of the various issues raised.
As to the RTCs admission of respondents petition for intervention, the appellate court
opined that it was improperly and erroneously made. The Court of Appeals believed that
the only recourse available to a mortgagor, in this case the respondents, in a foreclosure
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Land Titles and Deeds (Finals) 2017
On November 27, 2000, the Court of Appeals, in its Amended Decision, reconsidered its In its memorandum, NHA tendered the following issues:
earlier stance. It declared that the period of redemption had not expired as the certificate of
sale had not been registered or annotated in the original copies of the titles supposedly
1. WHETHER OR NOT THE ANNOTATION OF THE SHERIFFS
kept with the Register of Deeds since said titles were earlier razed by fire. Taking its cue CERTIFICATE OF SALE IN THE PRIMARY ENTRY BOOK
OF THE REGISTER OF DEEDS AND ON THE OWNERS
from Bass v. De la Rama where the Court purportedly made a ruling that entry of a
DUPLICATE TITLE IS SUFFICIENT COMPLIANCE WITH
document, such as sale of real property, in the entry book is insufficient to treat such THE REQUIREMENT OF LAW ON REGISTRATION.
document as registered, unless the same had been annotated on the certificate of title; the
Court of Appeals went on to say that the entry of the certificate of sale in the owners 2. WHETHER OR NOT THE CASE OF BASS VS. DE LA RAMA HAS
BEEN SUPERSEDED.[31]
duplicate of the titles could not have been sufficient to register the same since anyone who
would wish to check with the Register of Deeds would not see any annotation. Thus, entry
made on the owners duplicate of the titles cannot be considered notice that would bind the
Respondents, on the other hand, offered the following as issues:
whole world. Having been deprived of their right of redemption, the Court of Appeals
deemed it proper to allow respondents to intervene. The dispositive part of the amended
I
decision decrees:
Unfazed, NHA filed a motion for reconsideration, which the Court of Appeals denied in II
ACCORDINGLY, the Motion for Reconsideration dated February 24, WHETHER OR NOT THE INSTANT PETITION COMPLIES WITH THE
2000 is DENIED for lack of merit.[30] REQUIREMENTS OF RULE 45 OF THE RULES OF COURT.[32]
On the procedural aspect, respondents question NHAs alleged failure to include in its NHA faults the Court of Appeals reliance on Bass v. De la Rama since the ruling therein
petition copies of material portions of the record such as pleadings filed in the RTC and the stating that entry and annotation of a sale instrument on the owners duplicate copy only as
Court of Appeals as required under Section 4, Rule 45 of the Rules of Court. Respondents insufficient registration, was already abandoned in Development Bank of the Philippines v.
also pointed out the purported defective verification of NHA in view of the fact that it merely Acting Register of Deeds of Nueva Ecija, where it was allegedly ruled that the primary
stated that the one verifying had read the allegations of the petition and that the same entry alone of the transaction produces the effect of registration so long as the registrant
were true and correct to the best of his knowledge. According to respondents, such has complied with all that is required of him for purposes of entry and annotation.
declarations were not in accordance with the rules which require that a verified pleading
In contrast, respondents submit that annotation of the sheriffs certificate of sale on the
must state that the affiant had read the pleading and that the allegations therein were true
owners copy is inadequate to propel the running of the redemption period. They firmly
and correct based on his personal knowledge and not only to the best of his knowledge.
believe that for the sale instrument to be considered as registered, the inscription must be
As to the merits, NHA stresses that the annotation and entry in the owners made on the reconstituted titles.
duplicate certificate of titles of the sheriffs certificate of sale are sufficient compliance with
the requirement of law on registration. To support this, NHA refers to Land Registration
Administration Circular No. 3 dated December 6, 1988, entitled Entry and Provisional Respondents disagree with NHAs opinion that Bass v. De la Rama was superceded
Registration of Instruments Pending Reconstitution of Title which allegedly authorized all by Development Bank of the Philippines v. Acting Register of Deeds of Nueva Ecija. They
Registers of Deeds to accept for entry and provisional registration instruments affecting are of the persuasion that the ruling in DBP pertains exclusively to the unique factual
lost or destroyed certificates of title pending reconstitution of the original. The legality and milieu and the issues attendant therein, but not to the instant case where Bass purportedly
validity of the disputed registration on its duplicate copies of the sheriffs certificate of sale, applies. Respondents also assail NHAs citation of Sta. Ignacia Rural Bank, Inc. v. Court of
NHA insists, are backed by this Courts ruling in Development Bank of the Philippines v. Appeals.[34] According to them, said case finds no application to the instant controversy
Acting Register of Deeds of Nueva Ecija,[33] where purportedly, this Court made a because the issue involved in the former was whether the redemption period should be
favorable interpretation of Section 56 of Presidential Decree No. 1529. NHA says that the reckoned from the date of the auction sale or the registration of the certificate of sale,
inscription of the sheriffs certificate of sale only to the owners duplicate copies, but not to which ostensibly is not the bone of contention in this case.
those in the custody of the register of deeds is justified as the latter were burned
down. Thus, it could not be blamed for the non-registration of the sale in the original
copies. Ascribing NHAs inaction to have the burned titles reconstituted, respondents assert that
such neglect should not be used as a justification for the non-inscription in the original titles
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
of the certificate of sale.Additionally, respondents insist that the question of whether the In its petition, NHA attached the February 24, 2000 Decision, the November 27,
redemption period should be reckoned from the inscription on the owners duplicate copies 2000 Amended Decision, and the July 19, 2001 Resolution all of the Court of Appeals;
is a factual and legal issue that is appropriately adjudicated in a hearing on the merits of copies of the transfer certificates of title of the disputed properties; and the June 13,
their petition in intervention, and not in the instant special civil action for certiorari and 1994 Order of the Quezon City RTC ordering the reconstitution of the said titles. This Court
prohibition which is limited in scope, namely, whether the RTC committed grave abuse of finds that NHA substantially complied with the requirements under Section 4 of Rule
discretion amounting to lack of jurisdiction in admitting their petition in intervention. 45. The same conclusion was arrived at by this Court in Development Bank of the
Philippines v. Family Foods Manufacturing Co., Ltd.[36] when it was faced with the same
Respondents reiterate that the issuance of the writ of possession prayed for by NHA
before the RTC is no longer ministerial since it raised the issue of whether their period of
As held by this Court in Air Philippines Corporation v. Zamora:
redemption has already expired.They cite Barican v. Intermediate Appellate Court[35] as the
SEC. 4. Contents of petition. The petition shall be filed in Third, a petition lacking an essential
eighteen (18) copies, with the original copy intended for the court being pleading or part of the case record may still be given
indicated as such by the petitioner, and shall x x x (d) be accompanied due course or reinstated (if earlier dismissed) upon
by a clearly legible duplicate original, or a certified true copy of the showing that petitioner later submitted the
judgment or final order or resolution certified by the clerk of court of the documents required, or that it will serve the higher
court a quo and the requisite number of plain copies thereof, and such interest of justice that the case be decided on the
material portions of the record as would support the petition; x x x. merits.
We must stress that cases should be determined on the the allegations of a pleading are true and correct; are not speculative or merely imagined;
merits, after all parties have been given full opportunity to ventilate their
and have been made in good faith. [37] To achieve this purpose, the verification of a
causes and defenses, rather than on technicalities or procedural
imperfections. In that way, the ends of justice would be served better. pleading is made through an affidavit or sworn statement confirming that the affiant has
Rules of procedure are mere tools designed to expedite the decision or
resolution of cases and other matters pending in court. A strict and rigid read the pleading whose allegations are true and correct of the affiant's personal
application of rules, resulting in technicalities that tend to frustrate
rather than promote substantial justice, must be avoided. In fact, knowledge or based on authentic records. [38]
Section 6 of Rule 1 states that the Rules shall be liberally construed in
order to promote their objective of ensuring the just, speedy and
inexpensive disposition of every action and proceeding.
Contrary to respondents assertion, NHAs verification conforms to the rule. Section 4, Rule
7 of the Rules of Court states: 3. I have read the allegations contained therein and that the
same are true and correct to the best of my own personal knowledge. [39]
confirmed that he had read the allegations in the petition which were true and correct
A pleading is verified by an affidavit that the affiant has read the
pleading and that the allegations therein are true and correct of his based on his personal knowledge.The addition of the words to the best before the phrase
personal knowledge or based on authentic records. of my personal knowledge did not violate the requirement under Section 4 of Rule 7, it
being sufficient that the affiant declared that the allegations in the petition are true and
A pleading required to be verified which contains a verification based correct based on his personal knowledge.
on information and belief, or upon knowledge, information and belief, or
lacks a proper verification, shall be treated as an unsigned pleading.
Now, as to the merits of the case. The main issue before us is whether the
annotation of the sheriffs certificate of sale on the owners duplicate certificate of titles is
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Land Titles and Deeds (Finals) 2017
sufficient registration considering that the inscription on the original certificates could not Deeds who was chargeable with the keeping and custody of those documents. [42] To
be made as the same got burned. buttress its conclusion, the Court reviewed the relevant jurisprudence starting from
1934. The Court noted that before the Second World War, particularly in Government of
Jurisprudence is replete with analogous cases. Of foremost importance is Development
the Philippine Islands v. Aballe,[43] the prevailing doctrine was an inscription in the book of
[40]
Bank of the Philippines v. Acting Register of Deeds of Nueva Ecija where the Court
entry even without the notation on the certificate of title was considered as satisfactory and
listed cases where the transaction or instrument was annotated not on the original
produced all the effects which the law gave to its registration. During the war, however, the
certificate but somewhere else. In that case, DBP, following the extrajudicial foreclosure
Court observed that there was apparent departure from said ruling since in Bass v. De la
sale where it emerged as the highest bidder, registered with the Register of Deeds the
Rama, the holding was that entry of an instrument in the primary entry book does not
sheriffs certificate of sale in its favor. After it had paid the required fees, said transaction
confer any legal effect without a memorandum thereof inscribed on the certificate of
was entered in the primary entry book. However, the annotation of the said transaction to
title.[44] DBP noted that Bass v. De la Rama, however, survived only for a little while since
the originals of the certificates of title could not be done because the same titles were
later cases appear to have applied the Aballe ruling that entry in the day book, even
missing from the files of the Registry. This prompted DBP to commence reconstitution
without the corresponding annotation on the certificate of title, is equivalent to, or produces
proceedings of the lost titles. Four years had passed before the missing certificates of title
the effect of, registration to voluntary transactions, provided the requisite fees are paid and
were reconstituted. When DBP sought the inscription of the four-year old sale transaction
the owners duplicates of the certificates of title affected are presented.[45]
on the reconstituted titles, the Acting Register of Deeds, being in doubt of the proper action
to take, referred the matter to the Commissioner of the Land Registration Authority These later cases are Levin v. Bass[46] and Potenciano v. Dineros,[47] both of which involve
by consulta, the latter resolved against the annotation of the sale transaction and opined the issue of whether entry in the day book of a deed of sale, payment of the fees, and
that said entry was ineffective due to the impossibility of accomplishing registration at the presentation of the owners duplicate certificate of title constitute a complete act of
time the document was entered because of the non-availability of the certificate (sic) of title registration.[48]
involved.[41] In other words, annotation on the primary book was deemed insufficient
registration. The Court disagreed with this posture. Considering that DBP had paid all the
fees and complied with all the requirements for purposes of both primary entry and Simply, respondents resort to Bass v. De la Rama is futile as the same was abandoned by
annotation of the certificate of sale, the Court declared that mere entry in the primary book the later cases, i.e., Bass, Potenciano and DBP.
was considered sufficient registration since [DBP] cannot be blamed that annotation could
not be made contemporaneously with the entry because the originals of the subject
certificates of title were missing and could not be found, since it had nothing to do with
their safekeeping. If anyone was responsible for failure of annotation, it was the Register of
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Land Titles and Deeds (Finals) 2017
In the recent case of Autocorp Group v. Court of Appeals,[49] the respondent was awarded Indeed, the prevailing rule is that there is effective registration once the registrant has
the foreclosed parcels of land. A sheriffs certificate of sale was thereafter issued in its fulfilled all that is needed of him for purposes of entry and annotation, so that what is left to
favor. Thereafter, petitioners in that case filed a complaint before the RTC with a prayer for be accomplished lies solely on the register of deeds. The Court thus once held:
the issuance of an ex parte TRO aimed at preventing the Register of Deeds from
registering the said certificate of sale in the name of the respondent and from taking
Current doctrine thus seems to be that entry alone produces the effect
possession of the subject properties.[50] Before the RTC could issue a TRO, respondent of registration, whether the transaction entered is a voluntary or an
involuntary one, so long as the registrant has complied with all that is
presented the sheriffs certificate of sale to the Register of Deeds who entered the same
required of him for purposes of entry and annotation, and nothing more
certificate in the primary book, even if the registration fee was paid only the following remains to be done but a duty incumbent solely on the register of
deeds.[52]
day. Four days after, the RTC issued a TRO directing the Register of Deeds to refrain from
registering the said sheriffs certificate of sale. A preliminary injunction was thereafter
issued as the TRO was about to expire. The preliminary injunction was questioned by
therein respondent. One of the main issues raised there was whether the entry of the
In the case under consideration, NHA presented the sheriffs certificate of sale to the
certificate of sale in the primary book was equivalent to registration such that the TRO and
Register of Deeds and the same was entered as Entry No. 2873 and said entry was further
the preliminary injunction issues would not lie anymore as the act sought to be restrained
annotated in the owners transfer certificate of title. [53] A year later and after the mortgagors
had become an accomplished act. The Court held that the TRO and the preliminary
did not redeem the said properties, respondents filed with the Register of Deeds an
injunction had already become moot and academic by the earlier entry of the certificate of
Affidavit of Consolidation of Ownership[54]after which the same instrument was presumably
sale in the primary entry book which was tantamount to registration, thus:
entered into in the day book as the same was annotated in the owners duplicate
copy.[55] Just like in DBP, Levin, Potenciano and Autocorp, NHA followed the procedure in
In fine, petitioners prayer for the issuance of a writ of order to have its sheriffs certificate of sale annotated in the transfer certificates of
injunction, to prevent the register of deeds from registering the subject title. There would be, therefore, no reason not to apply the ruling in said cases to this
certificate of sale, had been rendered moot and academic by the
valid entry of the instrument in the primary entry book. Such entry one. It was not NHAs fault that the certificate of sale was not annotated on the transfer
is equivalent to registration. Injunction would not lie anymore, as the
act sought to be enjoined had already become a fait accompli or an certificates of title which were supposed to be in the custody of the Registrar, since the
accomplished act.[51]
same were burned. Neither could NHA be blamed for the fact that there were no
reconstituted titles available during the time of inscription as it had taken the necessary
steps in having the same reconstituted as early as July 15, 1988.[56] NHA did everything
obtaining, annotation of the disputed entry on the reconstituted originals of the certificates
of title to which it refers is entirely proper and justified, this does not mean, as respondents xxxx
insist, that the ruling therein applies exclusively to the factual milieu and the issue
obtaining in said case, and not to similar cases. There is nothing in the subject declaration
Like in DBP v. Acting Register of Deeds of Nueva Ecija, the instrument
that categorically states its pro hac vice character. For in truth, what the said statement involved in the case at bar, is a sheriffs certificate of sale, We hold now,
as we held therein, that the registrant is under no necessity to present
really conveys is that the current doctrine that entry in the primary book produces the effect the owners duplicates of the certificates of title affected, for purposes of
primary entry, as the transaction sought to be recorded is an
of registration can be applied in the situation obtaining in that case since the registrant involuntary transaction.
therein complied with all that was required of it, hence, it was fairly reasonable that its acts
be given the effect of registration, just as the Court did in the past cases. In fact the Court
xxxx
there continued with this pronouncement:
absent any statement thereof to such effect, contravenes the principle of stare
decisis which urges that courts are to apply principles declared in prior decisions that are
applied, thereby demonstrating that the said ruling in DBP may be applied to other cases
reckoned from the date of registration of the certificate of sale. [61] It must be noted that Considering that the foreclosure sale and its subsequent registration with the Register of
on April 16, 1991, the sheriffs certificate of sale was registered and annotated only on the Deeds were done validly, there is no reason for the non-issuance of the writ of
owners duplicate copies of the titles and on April 16, 1992, the redemption period expired, possession. A writ of possession is an order directing the sheriff to place a person in
without respondents having redeemed the properties. In fact, on April 24, 1992, NHA possession of a real or personal property, such as when a property is extrajudicially
executed an Affidavit of Consolidation of Ownership. Clearly, respondents have lost their foreclosed.[67] Section 7 of Act No. 3135 provides for the rule in the issuance of the writ of
opportunity to redeem the properties in question. possession involving extrajudicial foreclosure sales of real estate mortgage, to wit:
foreclosure sale is a futile attempt to salvage its statutory right to redeem their foreclosed
This provision of law authorizes the purchaser in a foreclosure sale to apply for a
properties, which right had long been lost by inaction.
writ of possession during the redemption period by filing an ex parte motion under oath for
property with Torrens title.[68] Upon the filing of such motion and the approval of the
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Land Titles and Deeds (Finals) 2017
corresponding bond, the law also in express terms directs the court to issue the order for a
writ of possession.[69] In Cometa, which actually involved execution of judgment for the
prevailing party in a damages suit, the subject properties were sold at
the public auction at an unusually lower price, while in Barican, the
The time-honored precept is that after the consolidation of titles in the buyers name, for
mortgagee bank took five years from the time of foreclosure before
failure of the mortgagor to redeem, the writ of possession becomes a matter of right. [70] Its filing the petition for the issuance of writ of possession. We have
considered these equitable and peculiar circumstances
issuance to a purchaser in an extrajudicial foreclosure is merely a ministerial in Cometa and Barican to justify the relaxation of the otherwise
absolute rule. None of these exceptional circumstances, however,
function.[71] The writ of possession issues as a matter of course upon the filing of the
attended herein so as to place the instant case in the same stature as
proper motion and the approval of the corresponding bond. The judge issuing the writ that of Cometa and Barican. Instead, the ruling in Vaca v. Court of
Appeals is on all fours with the present petition. In Vaca, there is no
following these express provisions of law neither exercises his official discretion nor dispute that the property was not redeemed within one year from the
registration of the extrajudicial foreclosure sale; thus, the mortgagee
judgment.[72] As such, the court granting the writ cannot be charged with having acted bank acquired an absolute right, as purchaser, to the issuance of the
without jurisdiction or with grave abuse of discretion. [73] To accentuate the writs ministerial writ of possession. Similarly, UOB, as the purchaser at the auction sale
in the instant case, is entitled as a matter of right, to the issuance of the
character, the Court disallowed injunction to prohibit its issuance despite a pending action writ of possession.
Believing that the instant case does not come within the penumbra of the foregoing rule, away from the established rule.
respondents resort to the ruling in Barican v. Intermediate Appellate Court. [75] Unfortunately
In fine, this Court finds that the Court of Appeals committed reversible error in
for them, the instant case does not even come close to the cited case. There, the Court
ruling that the annotation of NHAs sheriffs certificate of sale on the duplicate certificates of
deemed it inequitable to issue a writ of possession in favor of the purchaser in the auction
title was not effective registration and in holding that respondents redemption period had
sale considering that the property involved was already in the possession of a third person
not expired.
by virtue of a deed of sale with assumption of mortgage even before the purchaser could
register the sheriffs certificate of sale. Also, the auction buyer therein unreasonably WHEREFORE, premises considered, the instant petition is
deferred to exercise its right to acquire possession over the property. These circumstances hereby GRANTED. The Amended Decision of the Court of Appeals dated November 27,
are not present in the instant case. 2000 is SET ASIDE
SO ORDERED.
Moreover, in Fernandez v. Espinoza,[76] the Court refused to apply the ruling
Court,[78] two cases which are exemptions to the stated rule, reasoning that:
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Chairperson,
LEONARDO-DE CASTRO,
On June 3, 2004, petitioner Durawood Construction and Lumber Supply, Inc.
BERSAMIN,
(Durawood) filed an action for sum of money plus damages with a prayer for the issuance
- versus - DEL CASTILLO, and
of a writ of preliminary attachment against LBB Construction and Development Corporation
VILLARAMA, JR., JJ.
(LBB Construction) and its president Leticia Barber (Barber) before the Regional Trial Court
(RTC) of Antipolo. In said suit, which was docketed as Civil Case No. 04-7240, Durawood
Promulgated: prayed for the sum of P665,385.50 as payment for construction materials delivered to LBB
Construction.
Respondent.
x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x On June 14, 2004, the RTC issued an Order granting Durawoods prayer for the
issuance of a writ of attachment. On June 16, 2004, the corresponding writ was issued.
DECISION
On June 17, 2004, Sheriff Rolando C. Leyva (Sheriff Leyva) levied on a 344-
square meter parcel of land in Richdale Subdivision, Antipolo City covered by Transfer
LEONARDO-DE CASTRO, J.: Certificate of Title (TCT) No. R-17571 in the name of LBB Construction. A Notice of Levy
TCT No. R-17571. Candice claimed therein that she is a co-owner of the property covered
by TCT No. R-17571. She alleged that LBB Construction had sold the property to her and 2. Ordering the defendants to pay plaintiff twenty-five
percent (25%) of the amount due to the plaintiff by way of
her siblings, Michael Angelo S. Bona, Diane Sheila S. Bona, Glenda May S. Bona and
attorneys fees; and
Johann Louie Sebastian S. Bona, through a Deed of Absolute Sale dated June 2,
2004.Candice asserted that the sale is the subject of Entry No. 30549 dated June 16,
3. To pay the costs of suit.[4]
2004 in the books of the Registry of Deeds of Antipolo City, while the levy on
attachment is only Entry No. 30590 dated June 17, 2004. What was attached to the
Motion was a copy of TCT No. R-17571, and not a title in Candice and her co-owners
The Decision became final and executory. On September 12, 2005, Durawood
names.
filed a Motion for the Issuance of a Writ of Execution. On November 15, 2005, the RTC
issued a Writ of Execution. It was when this Writ was about to be enforced that Durawood
discovered the cancellation of TCT No. R-17571 and the issuance of TCT No. R-22522 in
On August 11, 2004, the RTC issued an Order granting Candices Motion to the name of Candice and her siblings.
Intervene.
It would appear from the records that on June 16, 2004, the supposed Register of
LBB Construction and Barber filed their Answer in Civil Case No. 04-7240, but Deeds of Antipolo City, Atty. Randy A. Rutaquio (Atty. Rutaquio), cancelled TCT No. R-
failed to attend the scheduled hearings, including the pre-trial. Consequently, Durawood 17571 and issued TCT No. R-22522 in the name of Candice and her co-owners. The
was allowed to present its evidence ex parte. parties, however, do not dispute that said cancellation of the old TCT and issuance of the
new one was antedated, since Atty. Rutaquio was still the Register of Deeds of Malabon
On July 21, 2005, the RTC rendered its Decision [3] in Civil Case No. 04-7240 in
on said date.[5] According to a certification of the Land Registration Authority, [6] it was a
favor of Durawood. The dispositive portion of the Decision reads:
certain Atty. Edgar D. Santos (Atty. Santos) who was the Acting Register of Deeds of
WHEREFORE, in view of the foregoing consideration,
judgment is rendered in favor of the plaintiff and against the Antipolo City on June 16, 2004.
defendants, viz:
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Primary Entry Book prior to the Levy on Attachment. The two transactions were assigned to
different examiners and it just so happened that the examiner to whom the levy on
6. While the Deed of Sale annotated in TCT No. R-17571
appears to have been made on June 16, 2004, the fact of its inscription attachment was assigned was able to inscribe the memorandum ahead of the sale,
was made after that of the levy on attachment as it obviously appears
although the inscription of the sale was entered ahead of the levy. The levy on attachment
below and next to it.
was not inscribed on TCT No. R-22522 because allegedly the sale should have priority and
preference. The cancellation of TCT No. R-17571 and the issuance of TCT No. R-22522
7. The records of this case reveal that in the Third Party Claim
filed by Candice Bona sometime in July 2004, there was never any was already completed when he took over the position of Atty. Santos as Acting Register of
mention of any recording about a Deed of Absolute Sale in the
Deeds and was therefore already clothed with the authority to issue and sign TCT No. R-
Memorandum of Encumbrances in TCT No. R-17571. It is difficult to
comprehend that Atty. Hernando U. Salvador, Bonas lawyer, would 22522.
miss mentioning that a Deed of Absolute Sale was inscribed ahead of
the notice of levy on attachment if ever such sale was made on June
16, 2004. Atty. Rutaquio also submitted a letter dated June 25, 2004 from Atty. Santos to
consulting the latter as regards the registration of the Deed of Absolute Sale and the Notice
8. Thus, under the circumstances, plaintiff corporation cannot
help speculate that [the] Deed of Sale between LBB Construction and of Levy on Attachment.[9] In said letter received by the LRA on July 1, 2004, Atty. Santos
the Bonas was made to appear to have been recorded a day before the
attachment. stated that he had not acted on the Deed of Absolute Sale since the required registration
fees were not paid therefor.[10] Administrator Ulep was able to reply to said letter on
October 6, 2004, when Atty. Rutaquio was already the Acting Register of
9. While the Notice of Levy on Attachment was inscribed in
TCT No. R-17571 ahead and before of the Deed of Sale between LBB Deeds.Administrator Ulep stated that since the Deed of Sale was considered registered on
Construction Co., Inc. and the Bonas, the said notice was not carried
over in TCT No. R-22522 despite the fact that there was no order
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
June 16, 2004, the same shall take precedence over the Notice of Levy on Attachment
registered on June 17, 2004.[11] Candice filed a Motion for Reconsideration of the above Order. In the meantime,
on March 13, 2006, Sheriff Leyva issued a Notice of Sheriffs Sale setting the sale of the
Acting on the Motion to Reinstate Notice of Levy on Attachment in TCT No. R-
property covered by TCT No. R-22522 at public auction on April 11, 2006 at 10:00 a.m.,
22522 and Cite Atty. Randy A. Rutaquio for Contempt, the RTC issued an Order [12] dated
pursuant to the November 15, 2005 Writ of Execution. Candice filed an Urgent Ex-Parte
March 2, 2006, ruling in favor of Durawood. The RTC gave great weight to the certification
Motion to Order the Branch Sheriff to Desist from the Sale of Intervenors Property for Being
by LRA Human Resource Management Officer IV Loreto I. Orense that Atty. Santos was
Premature, which was granted by the RTC in an Order dated March 29, 2006.
the Acting Register of Deeds from June 1-30, 2004, and held that this proves the fact that
Atty. Santos was the only person authorized to sign and approve all the transactions with On March 8, 2006, the new Acting Register of Deeds Jose S. Loriega, Jr.
the Registry of Deeds of Antipolo City at the time. Moreover, according to the RTC, the complied with the March 6, 2006 Order of the RTC by reinstating in TCT No. R-22522 the
alienation of LBB Construction in favor of the Bonas without leaving sufficient property to Notice of Levy on Attachment in favor of Durawood.
[13]
pay its obligation is considered by law in fraud of creditor under Articles 1381 and
On April 7, 2006, the RTC issued an Order denying Candices Motion for
1387[14] of the Civil Code.
Reconsideration. In said Order, the RTC highlighted its observation that in TCT No. R-
17571, the inscription of the levy on attachment by Atty. Santos dated June 17, 2004 was
in page A (the dorsal portion) of the title, while the supposedly earlier inscription of the
The RTC did not rule on Durawoods prayer to cite Atty. Rutaquio for
Deed of Sale by Atty. Rutaquio dated June 16, 2004 was found in page B (a separate
contempt. The dispositive portion of the March 2, 2006 Order reads:
page) of the title. The RTC found this fact, as well as the above-mentioned certification that
Atty. Santos was the Acting Register of Deeds of Antipolo City from June 1 to 30, 2004,
WHEREFORE, premises considered, the instant motion to sufficient proof of the irregularity of the June 16, 2004 inscription of the Deed of Sale.
reinstate notice of levy on attachment in TCT No. R-22522 now in the
name of the intervenors is hereby GRANTED its non-inscription therein
On April 11, 2006, Sheriff Leyva sold the subject property at public auction
having been made without order of this Court.
for P1,259,727.90 with Durawood being the lone bidder, and issued the corresponding
Certificate of Sale. The sale was inscribed in TCT No. R-22522 on the same date.[16]
The Register of Deeds of Antipolo City is directed to reinstate
the notice of levy on attachment in TCT No. R-22522 in the names of
intervenors immediately upon receipt of this Order.[15]
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
number, the date and the name of the former Register of Deeds,
Candice filed with the Court of Appeals a Petition for Certiorari and Prohibition already typewritten thereon but which, for some reasons, cannot
anymore be signed by the former official. In such cases and to resolve
assailing the March 2, 2006 and April 7, 2006 Orders of the RTC.
this problem, the present Register of Deeds may, without changing or
altering the transcriptions and inscriptions, affix his signature below the
On April 18, 2007, the Court of Appeals rendered the assailed Decision in favor of name of the former Register of Deeds but placing the actual date and
time of signing enclosed in parenthesis below his signature.[17]
Candice. According to the Court of Appeals, the sequence of presentation of the entries in
the TCT cannot control the determination of the rights of the claimants over a disputed The Court of Appeals accepted Atty. Rutaquios manifestation that he signed TCT
property. It is the registration in the Primary Entry Book (also referred to in other cases as No. R-22522 subsequent to June 16, 2004, on a date when he was already the Acting
the day book) that establishes the order of reception of instruments affecting registered Register of Deeds of Antipolo City.Since the entry in the Primary Entry Book was made at
land. As explained by Atty. Rutaquio, the entry in the day book is only the preliminary step the time of the incumbency of Atty. Santos, the name of the latter still appears on the
in the registration. The inscription of the levy on attachment on TCT No. R-17571 (which document. According to the Court of Appeals, Candice cannot be made to suffer for the
was made before the inscription of the Deed of Sale on said title) retroacts to the date of failure of Atty. Rutaquio to affix the date when he signed the document. Furthermore, a
entry in the Primary Entry Book, which is June 17, 2004. However, the inscription of the certificate of title, once registered, cannot be impugned, altered, changed, modified,
Deed of Sale on TCT No. R-17571, although made after the inscription of the levy on enlarged or diminished except in a direct proceeding permitted by law. Finally, an action for
attachment, retroacts to the earlier date of entry in the Primary Entry Book, which is June rescission of contracts entered into in fraud of creditors cannot be instituted except when
16, 2004. the party suffering damage has no other legal means to obtain reparation for the same. [18]
and Deeds Registration Administration (NALTDRA; now the Land Registration Authority
Durawood filed a Motion for Reconsideration, but the same was denied by the
[LRA]) Circular No. 94 on Certificates of title and documents left unsigned by former
Court of Appeals in its Resolution dated September 18, 2007.
Register of Deeds, which provides:
Durawood filed the instant Petition for Review, with the following Assignment of
Errors:
It has been brought to the attention of this Registration that, in
some Registries, there are certificates of title with the full transcriptions
and inscriptions, including the volume and page numbers, the title
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
I.
All these allegations are specific matters to be resolved by this Court in
determining the overriding issue of the case at bar: whether the Court of Appeals correctly
THE COURT OF APPEALS IGNORED THE FACT THAT NON-
granted Candices Petition for Certiorariand Prohibition on its finding that the RTC
PAYMENT OF THE REQUIRED REGISTRATION FEES BY CANDICE
S. BONA AND HER SIBLINGS DID NOT COMPLETE THE committed grave abuse of discretion in issuing its March 2, 2006 and April 7, 2006
REGISTRATION OF THE DEED OF ABSOLUTE SALE ON JUNE 16,
2004. Orders. In other words, the main issue to be determined by this Court is whether or not
there was grave abuse of discretion in the RTCs order to reinstate the notice of levy on
attachment in TCT No. R-22522. Grave abuse of discretion signifies such capricious and
II.
whimsical exercise of judgment that is equivalent to lack of jurisdiction. The abuse of
III.
The Court of Appeals, in considering the date of entry in the day book of the
Registry of Deeds as controlling over the presentation of the entries in TCT No. R-17571,
THE COURT OF APPEALS GRAVELY ERRED WHEN IT FAILED TO
relied on Section 56 of Presidential Decree No. 1529 which provides that:
CONSIDER THAT THE ENTRIES IN TCT NO. R-17571 (THE
PREDECESSOR OF TCT NO. R-22522) ARE EVIDENCES OF THE SEC. 56. Primary Entry Book; fees; certified copies. Each
FACTS STATED THEREIN. Register of Deeds shall keep a primary entry book in which, upon
payment of the entry fee, he shall enter, in the order of their reception,
all instruments including copies of writs and processes filed with him
relating to registered land. He shall, as a preliminary process in
IV.
registration, note in such book the date, hour and minute of reception of
all instruments, in the order in which they were received. They shall be
regarded as registered from the time so noted, and
THE COURT OF APPEALS OVERLOOKED THE FACT THAT THE the memorandum of each instrument, when made on the
REAL PROPERTY COVERED BY TCT NO. R-17571 AND certificate of title to which it refers, shall bear the same date:
SUBSEQUENTLY BY TCT NO. R-22522 HAS ALREADY BEEN Provided, that the national government as well as the provincial and city
ATTACHED BUT WAS UNILATERALLY RELEASED FROM THE governments shall be exempt from the payment of such fees in
COURTS JURISDICTION BY A USURPER.[20] advance in order to be entitled to entry and registration. (Emphasis
supplied.)
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
The consequence of the highlighted portion of the above section is two-fold: (1) in However, a close reading of the above-mentioned cases reveals that for the entry
determining the date in which an instrument is considered registered, the reckoning point is of instruments in the Primary Entry Book to be equivalent to registration, certain
the time of the reception of such instrument as noted in the Primary Entry Book; and (2) requirements have to be met. Thus, we held in Levin that:
when the memorandum of the instrument is later made on the certificate of title to which it Do the entry in the day book of a deed of sale which was presented and
filed together with the owner's duplicate certificate of title with the office
refers, such memorandum shall bear the same date as that of the reception of the
of the Registrar of Deeds and full payment of registration fees
instrument as noted in the Primary Entry Book. Pursuant to the second consequence constitute a complete act of registration which operates to convey and
affect the land? In voluntary registration, such as a sale, mortgage,
stated above, the Court of Appeals held that Atty. Rutaquio correctly placed the date of lease and the like, if the owner's duplicate certificate be not
surrendered and presented or if no payment of registration fees be
entry in the Primary Entry Book as the date of the memorandum of the registration of the made within 15 days, entry in the day book of the deed of sale
deed of sale in TCT No. R-17571. does not operate to convey and affect the land sold. x x x.[28]
Levin, which was decided in 1952, applied Section 56 of the Land Registration
annotated on TCT No. R-17571 earlier than the Deed of Sale. As discussed in the above-
mentioned cases, the annotation in the certificate of title is not determinative of the
This provision is the precursor of the aforequoted Section 56 of Presidential compared the date when the required fees were paid with the therein assailed writ of
Decree No. 1529, which seems to have dispensed with the provision nullifying the preliminary injunction:
In Development Bank of the Philippines v. Acting Register of Deeds of Nueva First. The objection as to the payment of the requisite fees is
unavailing. There is no question that the fees were
Ecija,[30] this Court applied the provisions of Presidential Decree No. 1529 and modified the
paid, albeit belatedly. Respondent bank presented the certificate of sale
doctrine as follows: to the Office of the Register of Deeds of Cebu City for registration
on January 21, 1999 at 4:30 p.m. As the cashier had already left, the
Current doctrine thus seems to be that entry alone produces Office could not receive the payment for entry and registration fees, but
the effect of registration, whether the transaction entered is a voluntary still, the certificate of sale was entered in the primary entry book. The
or an involuntary one, so long as the registrant has complied with following day, respondent bank paid the requisite entry and registration
all that is required of him for purposes of entry and annotation, fees. Given the peculiar facts of the case, we agree with the Court of
and nothing more remains to be done but a duty incumbent solely Appeals that the payment of respondent bank must be deemed to be
on the register of deeds.[31] substantial compliance with the law; and, the entry of the instrument the
day before, should not be invalidated. In any case, even if we consider
the entry to have been made on January 22, the important fact is that
This pronouncement, which was reiterated in National Housing Authority v. Basa, the entry in the primary entry book was done prior to the issuance of
the writ of injunction [on February 15, 1999; TRO issued on January
Jr.,[32] shows that for the entry to be considered to have the effect of registration, there is
25, 1999] by the trial court.[34] (Emphases supplied.)
still a need to comply with all that is required for entry and registration, including the
payment of the prescribed fees. Thus, in Autocorp Group v. Court of Appeals,[33] this Court
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
paid the reason for which the same was not immediately acted
Records in the case at bar reveal that as of June 25, 2004, the date of the letter upon by the undersigned.[35]
of Atty. Santos seeking the opinion of the LRA as regards the registration of the Deed of
Sale and the Notice of Levy on Attachment, the required registration fees for the Deed of
25 June 2004 Since there was still no compliance of all that is required x x x for purposes of
[received by the LRA: July 01, entry and annotation[36] of the Deed of Sale as of June 25, 2004, we are constrained to rule
2004] that the registration of the Notice of Levy on Attachment on June 17, 2004 should take
precedence over the former. Considering that the Notice of Levy on Attachment was
HON. BENEDICTO B. ULEP deemed registered earlier than the Deed of Sale, the TCT issued pursuant to the latter
This Authority
In view of the foregoing, we find that the RTC was, in fact, acting properly when it
ordered the reinstatement of the Notice of Levy on Attachment in TCT No. R-22522. Since
Sir: the RTC cannot be considered as to have acted in grave abuse of its discretion in issuing
such Order, the Petition for Certiorari assailing the same should have been dismissed.
G.R. No. 199180, July 27, 2016 209894.10At about the same time, Thelma saw an announcement that a new Orani
Common Terminal would be built on Lot 398-A. As she has not yet entered into any
THELMA RODRIGUEZ, JOINED BY HER HUSBAND, Petitioners, v. SPOUSES JAIME agreement regarding the utilization of said lot, Thelma filed a Complaint for
Injunction docketed as Civil Case No. 7394 against then incumbent mayor Efren Pascual,
SIOSON AND ARMI SIOSON, ET AL., Respondents.
Jr. (Mayor Pascual), and the Municipality under claim of ownership. To support her claim,
Thelma incorporated in her complaint a copy of an undated and unnotarized deed of
DECISION absolute sale allegedly executed by Neri in her favor.11chanrobleslaw
REYES, J.: In their joint verified answer, Mayor Pascual and the Municipality acknowledged that
Thelma became the owner of Lot 398-A by way of purchase from Neri.12chanrobleslaw
Before the Court is a petition for review1 under Rule 45 of the Rules of Court assailing the In 2002, Neri executed an affidavit claiming that the owner's copies of TCT No. T-209894
Decision2dated May 26, 2011 and Resolution3 dated October 21, 2011 of the Court of (covering Lot 398-A) and TCT No. T-209895 (covering Lot 398-B) were lost, which was
Appeals (CA) in CA-G.R. CV No. 94867, which nullified the Joint Decision 4 dated August annotated on the original copy of TCT No. T-209894 on May 8, 2002.13 Two days after, or
13, 2009 of the Regional Trial Court (RTC) of Bataan, Branch 3. on May 10, 2002, Neri caused the cancellation of Thelma's adverse claim.14 Neri also
caused the reconstitution of new owner's copies of TCT Nos. T-209894 and T-
The Facts 209895.15 Thereafter, new copies of TCT Nos. T-209894 and T-209895 were issued, and
Neri then sold Lot 398-A to Spouses Jaime and Armi Sioson, Spouses Joan and Joseph
This petition is the aftermath of a series of sales transactions entered into by Neri delos Camacho, and Agnes Samonte (respondents) - in a deed of sale dated November 27,
Reyes (Neri) over a portion of a property formerly identified as Lot 398, with an area of 2002. A special power of attorney was executed by Violeta delos Reyes (Violeta) in favor
22,398 square meters, covered by Transfer Certificate of Title (TCT) No. T-86275 and of Neri for the purpose. Consequently, TCT No. T-209894 was cancelled, and TCT No. T-
registered in the name of "Neri delos Reyes, married to Violeta Lacuata."5chanrobleslaw 226775 was thus issued in the respondents' names. 16chanrobleslaw
Sometime in 1997, the Municipality of Orani, Bataan (Municipality) purchased from Neri an Upon the issuance of TCT No. T-226775, the respondents declared Lot 398-A for tax
area of about 1.7 hectare of Lot 398, to be used for the extension of the Municipality's purposes and paid them accordingly. They sought to take actual possession thereof by
public market. Among other things, it was agreed that upon full payment of the purchase filling it; however, after they filled said lot with about 40 truckloads of soil/fillings, Thelma
price, Neri will surrender the mother title to the Municipality for subdivision of the property sent two armed blue guards who entered the premises and set up a tent therein. The
on the condition that Neri will equitably share in the expense thereof. 6chanrobleslaw respondents brought the matter to the attention of barangay authorities who referred them
to the municipal mayor. As the municipal mayor did not take any action, the respondents
Lot 398 was subsequently subdivided into 5 lots: Lot 398-A, Lot 398-B, Lot 398-C, Lot 398- filed a forcible entry case against Thelma before the Municipal Circuit Trial Court of Orani-
D, and Lot 398-E. Lots 398-C and 398-D pertain to the portions that were sold to the Samal, Bataan, docketed as Civil Case No. 843. The said ejectment case is still
Municipality, while Lot 398-E is a road lot. Consequently, only Lots 398-A and 398-B were pending.17chanrobleslaw
left as the remaining portions over which Neri retained absolute title. TCT Nos. T-209894
and T-209895 were then respectively issued over Lots 398-A and 398-B and were both After Thelma learned of the second sale of Lot 398-A, she filed against the respondents a
registered in the name of "Neri delos Reyes, married to Violeta Lacuata." The owner's complaint for the Declaration of Nullity of the Second Sale and TCT No. T-226775 on
duplicate copies of TCT Nos. T-209894 and T-209895, however, were retained by the February 11, 2003, docketed as Civil Case No. 7664. In support of her claim, Thelma
Municipality pending Neri's payment of his share in the expenses incurred for the once again presented a deed of absolute sale executed by Neri in her favor. This time, the
subdivision of Lot 398. These were placed under the custody of the Municipal Treasurer, deed of sale she presented was duly signed by her and Neri, witnessed, notarized and
where they continue to remain.7chanrobleslaw dated April 10, 1997.18chanrobleslaw
Neri, however, alleged that then Municipal Mayor Mario Zuiga suggested that he sell Lot The respondents countered that they are innocent purchasers for value having bought Lot
398-A to his aunt, petitioner Thelma Rodriguez (Thelma). The Municipality would then 398-A at the time when Thelma's adverse claim was already cancelled. While they admit
expropriate the same from Thelma. Neri agreed to the suggestion. 8chanrobleslaw Thelma's possession of the subject property, they, however, qualify that possession is
being contested in a separate action for forcible entry. 19chanrobleslaw
After agreeing to the amount of P1,243,000.00 as the selling price, Thelma, on March 20,
1997, issued a check for said amount payable to Neri. When it fell due, no sufficient funds The respondents also filed a verified answer-in-intervention in Civil Case No. 7394
were available to cover the check. Consequently, it was agreed that Thelma would pay the (injunction case) contending that they are the present registered owners of Lot 398-A, and
purchase price in installments from March 20, 1997 to September 4, 1997. Thelma, as such, Thelma is not entitled to any relief.20chanrobleslaw
however, was only able to pay P442,293.50.9chanrobleslaw
Ruling of the RTC
On November 12, 2001, Thelma caused the annotation of an adverse claim on TCT No. T-
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
WHEREFORE, the instant Appeal is GRANTED. The Joint Decision dated August 13,
The RTC jointly heard Civil Case No. 7394 and Civil Case No. 7664 and after trial, 2009 and the Order dated January 13, 2010 of the [RTC] of Bataan are hereby
rendered judgment in favor of Thelma. The dispositive portion of the Joint Decision 21 dated declared NULL and VOID insofar as it (1) granted permanent injunction in favor of
August 13, 2009 reads:ChanRoblesVirtualawlibrary [Thelma] in Civil Case No. 7394 against [the respondents];T2) declared null and void the
WHEREFORE, judgment is hereby rendered declaring that:ChanRoblesVirtualawlibrary deed of sale between [Neri] and [the respondents] in Civil Case No. 7664; (3) declared null
1) [Thelma] is entitled to the relief of permanent injunction prayed for in Civil Case No. and void the [TCT] No. T-226775; (4) ordered the cancellation of [TCT] No. T-226775 and
7394 against the respondents. Insofar as defendants [Mayor Pascual] and the reinstatement of [TCT] No. T-209894 in the name of [Neri], married to [Violeta]; and (5)
[Municipality] are concerned, not only did they acknowledge expressly the ownership of ordered the payment of attorney's fees.
[Thelma] of Lot 398-A, they have disowned the commission of any act in derogation of
[Thelma's] right of ownership of the lot and did not contest anymore the action of [Thelma] Consequently, the following are hereby declared VALID: (1) the Deed of Sale between
in said case; [Neri] and [the respondents]; and (2) the [TCT] No. T-226775 in the names of [the
respondents].
2) Insofar as Civil Case No. 7664 is concerned, the second deed of sale entered into by
[Neri] with the [respondents] is hereby declared null and void, and [TCT] No. T-226775 of This Decision is without prejudice to any right which [Thelma] may have against [Neri] for
the Registry of Deeds of Bataan which was issued by defendant Register of Deeds the refund of the amount of Four Hundred Forty-Two Thousand Two Hundred Ninety-
pursuant to said second deed of sale is likewise declared null and void, and accordingly, Three and 50/100 Pesos (P442,293.50).
the Register of Deeds for the Province of Bataan is ordered to cancel said certificate of title
and to reinstate [TCT] No. T-209894 in the name of [Neri], married to [Violeta]; The Complaints in Civil Cases Nos. 7394 and 7664 are hereby DISMISSED.
3) The new owner's copy of [TCT] No. T-209894 is hereby declared null and void as the SO ORDERED.27 (Emphasis in the original)
original owner's copy is not lost but actually exists and is presently in the custody of the Contrary to the findings of the RTC, the CA found that the contract between Neri and
Municipal Treasurer of Orani, Bataan. In consequence, defendant Register of Deeds of Thelma was a mere contract to sell and not a contract of sale; hence, there was no
Bataan is directed to cancel said new owner's copy of [TCT] No. T-209894; double sale of Lot 93 8-A. According to the CA, the question of whether or not the
and cralawlawlibrary respondents are buyers in good faith is unavailing since the concept of a "buyer in good
faith" finds relevance only in cases of double sale. The CA further stated that even if it is
4) [The respondents] are hereby ordered to jointly and severally pay to [Thelma] attorney's assumed that the contract between Neri and Thelma was an absolute contract of sale, the
fees in the amount of Twenty[-]Five Thousand Pesos (P25,000.00). same is nonetheless void for lack of consent of Neri's wife, Violeta, insofar as the object of
All counterclaims of [the respondents] are denied for lack of basis in fact and in law. the transaction is a conjugal property.
No pronouncement as to costs. Thelma moved for reconsideration of the CA decision, which was denied for lack of merit in
Resolution28 dated October 21, 2011.
SO ORDERED.22chanroblesvirtuallawlibrary
The RTC concluded that by Neri's admission that he sold the subject lot to Thelma for a Hence this petition.
consideration of P1,243,000.00, and his acknowledgement receipt of P442,293.50 as
partial payment from the latter, the transaction between Thelma and Neri should be Thelma argues that there was double sale and the CA erred in reversing the RTC decision:
regarded as an executed contract of sale. Hence, Lot 398-A was subjected to a double (1) by interpreting the sale between Thelma and Neri as a mere contract to sell; (2) by
sale when Neri sold the same property to the respondents. 23 The RTC further ruled that declaring the deed of sale in favor of Thelma as null and void due to lack of Violeta's
the contract of sale between Neri and the respondents is null and void because it was consent or conformity; and (3) by declaring the respondents as buyers in good faith
transacted and executed at the time when Neri was no longer the owner of Lot 398-A. It despite prior registration of Thelma's notice of adverse claim in TCT No. T-209894, and
was legally inexistent for lack of object certain. Thereupon, the fact that the respondents her actual possession of the subject property. 29chanrobleslaw
were able to register their acquisition first is of no moment. Registration does not legitimize
a void contract and thus, TCT No. T-226775 should be cancelled.24chanrobleslaw Ruling of the Court
The respondents moved for reconsideration but it was denied by the RTC per The resolution of this case basically rests on the determination of whether the transaction
Order25cralawred dated January 13, 2010. Hence, they elevated their case to the CA. between Neri and Thelma is a contract of sale or a contract to sell. The rule on double
sale, as provided in Article 1544 of the Civil Code,30 does not apply to a case where there
Ruling of the CA was a sale to one party of the land itself while the other contract was a mere promise to
sell the land or at most an actual assignment of the right to repurchase the same
On May 26, 2011, the CA promulgated the assailed Decision, 26 with the following land.31chanrobleslaw
dispositive portion:ChanRoblesVirtualawlibrary
Both the RTC and the CA concur in the finding that Neri agreed to sell Lot 398-A to
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Thelma for an agreed price of P1,243,000.00. The RTC, however, concluded that by Neri's thereof to the prospective buyer, binds himself to sell the property exclusively to the
admission that he sold the subject lot to Thelma for a consideration of P1,243,000.00, and prospective buyer upon fulfillment of the condition agreed upon, i.e., the full payment of the
that he acknowledged receipt of P442,293.50 as partial payment from the latter, the purchase price."38 As stated by the Court, the agreement to execute a deed of sale upon
transaction between Thelma and Neri should be regarded as an executed contract of sale, full payment of the purchase price "shows that the vendors reserved title to the subject
and not a merely executory one. The RTC likewise took into consideration Thelma's property until full payment of the purchase price." 39chanrobleslaw
alleged possession of the property and Neri's failure to rescind the contract as indicative of
the nature of their agreement as one of sale. 32chanrobleslaw It was likewise established that Thelma was not able to pay the full purchase price, and
that she was only able to pay P442,293.50 of the agreed selling price of P1,243,000.00.
On the other hand, the CA ruled that "the contract between Thelma and Neri was a mere The RTC, in fact, made the following findings: (1) the consideration for Lot 398-A was
contract to sell, the transfer of ownership over Lot 398-A being conditioned on Thelma's full P1,243,000.00; (2) Thelma issued a check on March 20, 1997 for said amount, payable to
payment of the purchase price."33 As regards the existence of the two contracts of sale, the Neri; (3) the agreement was that the check would only be held by Neri for safekeeping as it
CA concluded that Thelma admitted on trial that the first deed of sale was only meant to be was yet unsure if there was ample funds to cover the check; (4) the check was not covered
an acknowledgment receipt for the down payment she made on the subject lot, and the by sufficient funds when presented for payment, so Thelma subsequently paid Neri in
second deed of sale was allegedly executed after Thelma pays in full the purchase price of installments starting from March 20, 1997 to September 4, 1997; and (5) Neri
the lot. acknowledged receipt from Thelma the total amount of P442,293.50. 40chanrobleslaw
A review of this case shows that the CA ruled in accord with existing jurisprudence. To bolster her claim, Thelma insists that she now holds title over the subject property after
Neri allegedly delivered the subject lot to her right after the execution of the sale. 41 There
"The real character of the contract is not the title given, but the intention of the parties." 34 In is, however, nothing on record to support this claim aside from her bare assertions. There
this case, there exist two deeds of absolute sale. Though identically worded, the first was no testimony or any proof on her part showing when and how she took possession of
contract was undated, not notarized, signed only by Neri, and was presented in Civil Case the property. At best, what is extant from the records is that Thelma paid taxes on the
No. 7394 for Injunction,35 while the second deed was dated April 10, 1997, notarized on property for the years 2000 and 2001, which was three years after the alleged sale. "But
September 5, 1997, signed by both Neri and Thelma, and was presented in Civil Case No. tax declarations, by themselves, are not conclusive evidence of ownership of real
7664 for Declaration of Nullity of Deed of Sale and Title.36chanrobleslaw property."42 Aside from this, the tax receipts showed that the property was still declared in
the name of Neri.43chanrobleslaw
In determining the nature of the agreement between Thelma and Neri, the CA took note of
these two documents, and, coupled with Thelma's own admissions, correctly found that it Moreover, the alleged delivery of the property, even if true, is irrelevant considering that in
was a mere contract to sell. According to the CA:ChanRoblesVirtualawlibrary a contract to sell, ownership is retained by the registered owner in spite of the partial
During trial, Thelma explained the apparent disparity between the two (2) "deeds of payment of the purchase price and delivery of possession of the property. Thus, in Roque
absolute sale" by testifying that the undated and unnotarized deed of sale served only as a v. Aguado,44 the Court ruled that since the petitioners have not paid the final installment of
"receipt" which was signed by Neri when the latter received the downpayment for the lot. the purchase price, the condition which would have triggered the parties' obligation to enter
The dated and notarized deed of sale, on the other hand, was signed by both Thelma and into and thereby perfect a contract of sale cannot be deemed to have been fulfilled;
Neri upon Thelma's alleged full payment of the purchase price: consequently, they "cannot validly claim ownership over the subject portion even if
they had made an initial payment and even took possession of the
chanRoblesvirtualLawlibraryx x x x same."45chanrobleslaw
Second, the execution of the "deed of absolute sale" dated August 10, 1997 and the Accordingly, the CA did not commit any reversible error in concluding that "the contract
transfer and delivery of the title to Thelma's name covering Lot No. 398-A were conditioned between Thelma and Neri was a mere contract to sell, the transfer of ownership over Lot
upon full payment of the purchase price. 398-A being conditioned on Thelma's full payment of the purchase price. Having failed to
pay the purchase price in full, Thelma cannot claim ownership over Lot 398-A and Neri is
Thelma testified that the "deed of absolute sale" dated August 10, 1997 and which was not legally proscribed from alienating the same lot to other buyers." 46chanrobleslaw
attached to Thelma's complaint in Civil Case No. 7664 was signed by her, Neri and their
witnesses only upon full payment of the purchase price. Thelma further testified that she Finally, while the CA correctly ruled that the agreement was a contract to sell, the Court,
and Neri agreed to place the amount of the purchase price on the deed of absolute sale however, does not share its position that the subject property is a conjugal property, and
only at the time when Thelma had fully paid the same: x x x37 (Italics ours and emphasis as such, the absence of Violeta's consent should be held as among the factors which
deleted) could have adversely affected the validity of the purported contract of sale between Neri
Despite the denomination of their agreement as one of sale, the circumstances tend to and Thelma. This is due to the following reasons: first, the subject property, Lot 398-A, is
show that Neri agreed to sell the subject property to Thelma on the condition that title and registered in the name of "Neri delos Reyes, married to Violeta Lacuata," and so was its
ownership would pass or be transferred upon the full payment of the purchase price. This mother lot, Lot 398. In Metropolitan Bank and Trust Company v. Tan,47 it was held that
is the very nature of a contract to sell, which is a "bilateral contract whereby the such form of registration is determinative of the property's nature as paraphemal. That the
prospective seller, while expressly reserving the ownership of the property despite delivery only import of the title is that Neri is the owner of the subject property, it being registered in
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Land Titles and Deeds (Finals) 2017
his name alone, and that he is married to Violeta; and second, the record is bereft of proof
that said property was acquired during Neri and Violeta's marriage - such that, the
presumption under Article 116 of the Family Code that properties acquired during the CECILIA AMODIA VDA. DE MELENCION, VENERANDA AMODIA, FELIPE
marriage are presumed to be conjugal cannot apply. AMODIA, EUTIQUIO AMODIA and GO KIM CHUAN, G.R. No. 148846
Petitioners,
WHEREFORE, the petition is DENIED for lack of merit. Accordingly, the Decision dated
May 26, 2011 and Resolution dated October 21, 2011 of the Court of Appeals in CA-G.R.
CV No. 94867 are AFFIRMED.
- versus -
SO ORDERED.
x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - x
DECISION
NACHURA, J.:
Before this Court is a Petition for Review on Certiorari[1] under Rule 45 of the Rules of Civil
Procedure seeking the reversal of the Court of Appeals (CA) Decision[2] dated March 30,
2001 and praying that the Decision[3] of the Regional Trial Court (RTC) of Lapu-Lapu City,
The Facts
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Chuan for and in consideration of P70,000.00. The lost title covering the subject property
The subject property is a 30,351 square meter parcel of land (subject property) particularly
was reconstituted pursuant to Republic Act (RA) No. 26. [14] A reconstituted title particularly
denominated as Lot No. 3368, located at Suba-basbas, Marigondon, Lapu-Lapu
designated as Original Certificate of Title (OCT) No. RO-2899 was issued in the name of
City, Cebu, and part of a total area of 30,777 square meters covered by Transfer
Esteban Bonghanoy[15] and, subsequently, a derivative title (TCT No. 20626) was issued in
Certificate of Title (TCT) No. 20626[4] (entire property) in the name of the late petitioner Go
the name of Go Kim Chuan on December 1, 1989. Thereafter, Go Kim Chuan exercised
Kim Chuan (Go Kim Chuan).[5]
control and dominion over the subject property in an adverse and continuous manner and
Juana Bonghanoy-Amodia,[7] mother of the late Leoncia Amodia and petitioners Cecilia On February 14, 1990, AZNAR wrote a letter[16] to petitioners Amodias asking the latter to
Amodia Vda. de Melencion, Veneranda Amodia, Felipe Amodia, and Eutiquio withdraw and/or nullify the sale entered into between them and Go Kim Chuan. On the
Amodia[8] (the Amodias). The entire property was brought under the operation of the same date, a Notice of Adverse Claim[17] was annotated by AZNAR on TCT No. 20626.
Torrens System.[9] However, the title thereto was lost during the Second World War. Because petitioners did not heed AZNAR's demand, on April 25, 1990, AZNAR filed a case
against petitioners Amodias and Go Kim Chuan for Annulment of Sale and Cancellation of
On July 10, 1964, the Amodias allegedly executed an Extra-Judicial Partition of Real TCT No. 20626[18] alleging that the sale to Go Kim Chuan was an invalid second sale of
Estate with Deed of Absolute Sale[10] whereby they extra-judicially settled the estate of the subject property which had earlier been sold to it. Petitioners Amodias denied that they
Esteban Bonghanoy and conveyed the subject property to respondent Aznar Brothers executed the Extra-Judicial Partition of Real Estate with Deed of Absolute Sale in favor of
Realty Company (AZNAR) for a consideration of P10,200.00. On August 10, 1964, the AZNAR, claiming that their purported signatures thereon were forged. [19] Trial on the merits
said Extra-Judicial Partition of Real Estate with Deed of Absolute Sale was registered ensued.
under Act 3344[11] as there was no title on file at the Register of Deeds of Lapu-Lapu The RTC's Decision
City (Register of Deeds). Thereafter, AZNAR made some improvements and constructed a On February 18, 1993, the RTC dismissed AZNAR's complaint and declared Go Kim
beach house thereon. Chuan as the real owner of the subject property. The RTC ratiocinated that the signatures
of the Amodias in the Extra-Judicial Partition of Real Estate with Deed of Absolute Sale
On February 18, 1989, petitioners Cecilia Amodia Vda. de Melencion, Veneranda Amodia, executed in favor of AZNAR were found by the document examiner of the Philippine
Felipe Amodia and Eutiquio Amodia[12] (petitioners Amodias) executed a Deed of Extra- Constabulary (PC) Crime Laboratory to be forged, thus, the said deed did not convey
Judicial Settlement with Absolute Sale,[13]conveying the subject property in favor of Go Kim anything in favor of AZNAR. Moreover, the subject property had been brought under the
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
No costs.
On March 30, 2001, the CA rendered a Decision holding that the Extra-Judicial Partition of
SO ORDERED.[21]
Real Estate with Deed of Absolute Sale executed by the Amodias in favor of AZNAR was
registered ahead of the Deed of Extra-Judicial Settlement with Absolute Sale in favor of Go
Petitioners filed a Motion for Reconsideration[22] which the CA denied in its
Kim Chuan, thus, pursuant to Article 1544 of the New Civil Code, the former deed should
Resolution[23] dated June 5, 2001.
be given preference over the latter; that AZNAR's adverse claim was annotated earlier
than the execution of the Deed of Extra-Judicial Settlement with Absolute Sale in favor of
Hence, this Petition based on the following grounds:
Go Kim Chuan; hence, the latter should have respected said adverse claim and should
I
have made inquiries as to possible defects that may exist in the title over the subject
Lot 3368 was already a registered land under Act 496, thus, the
property; and that in the absence of a final determination by a court of proper jurisdiction registration by respondent of the Deed of Sale in 1964 under Act
3344 produces no legal effect whatsoever;
on the alleged forged signatures of the Amodias in the Extra-Judicial Partition of Real
Estate with Deed of Absolute Sale, the finding of the document examiner was insufficient II
for the RTC to rule in favor of the petitioners. Even assuming arguendo that the lot in question was duly registered
under Act 3344 as an unregistered land, it is without prejudice to
better rights and the provision of Article 1544 of the New Civil Code
would be inapplicable;
The CA disposed of the case in this wise:
WHEREFORE, premises considered, the assailed decision III
dated February 18, 1993 of the Regional Trial Court of Lapu-Lapu City,
Branch 27, in Civil Case No. 2254-L is hereby REVERSED and SET The Honorable Court of Appeals erred in holding that an adverse
ASIDE and a new one is hereby entered as follows: claim was already existing at the time the subject land was sold to
petitioner Go Kim Chuan; on the contrary, the latter had purchased
(1) Declaring plaintiff-appellant Aznar Brothers the said land in good faith and for value, without notice of any fact
Realty Company as the real owner of the land that would reasonably impel a closer inquiry as to the possibility of a
in question; defect in the vendor's title; and
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Land Titles and Deeds (Finals) 2017
IV they were parties before the RTC and CA. The counsel also manifested that he was only
The Court of Appeals has misapplied the case of Heirs of Severa representing the Heirs of Go Kim Chuan in this case. Lastly, he claimed that other than the
Gregorio v. CA, 300 SCRA 565, cited in support of its ruling that the
court a quo committed error in appreciating the testimony of an expert substitution of the original petitioners, both the Original Petition and Amended Petition
witness as to the forgery of the first Deed of Sale. [24]
uniformly raised the same issues and should be given due course in the greater interest of
In its Comment[25] dated September 18, 2001, AZNAR argued, among others, that the justice and that the instant Motion was not interposed for delay.
In their Reply[27] dated October 22, 2001, petitioners contended that April Socorro Go is consent.
one of the legitimate children and an heir of the late Go Kim Chuan and, as such, she has
In their Reply,[32] the Heirs of Go Kim Chuan, through counsel, claimed that petitioners
personal knowledge of the truth of the facts alleged in the Petition. Petitioners submitted
Amodias were excluded from the Amended Petition because they can no longer be located
that they substantially complied with the Rules of Court by attaching the required
despite diligent efforts exerted by counsel. The counsel claims that after the rendition of
Verification and Certification of Non-Forum Shopping and since the same are required
the assailed CA Decision, he sent several letters to petitioners Amodias but they did not
simply to facilitate and promote the orderly administration of justice, compliance therewith
reply; hence, the Heirs of Go Kim Chuan, left with no choice, filed the instant case before
should not be imposed with absolute literalness.
this Court on their own.
On December 19, 2001, petitioners, through counsel, filed a Motion [28] for Leave to Admit
The Court issued a Resolution[33] dated September 16, 2002 giving due course to the
[29]
Amended Petition for Review on Certiorari (Amended Petition). Petitioners manifested
Petition and requiring the parties to submit their respective Memoranda.
that they were seeking to correct a defect in the designation of parties and prayed that the
Heirs of Go Kim Chuan, namely, Estrella S. Go, Sonia Beth Go-Reynes, Daryl Go, and In their Memorandum,[34] petitioners Heirs of Go Kim Chuan reiterate the same issues
April Socorro Go be impleaded as petitioners instead of the earlier designated petitioners, raised in the Original Petition and the Amended Petition. They argue that Act 3344 only
Cecilia Amodia Vda. de Melencion, Veneranda Amodia, Felipe Amodia, Eutiquio Amodia, refers to transactions affecting lands or interests therein not previously registered under
and Go Kim Chuan. Counsel for petitioners admitted that he inadvertently included the the Spanish Mortgage Law or under the Torrens system; that if AZNAR could not have
petitioners Amodias in the initial Petition for Review on Certiorari (Original Petition), as registered the sale in 1964 under Act 496 because the title over the subject property was
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
lost, AZNAR should have availed itself of the remedy of reconstitution; that registration vendors' power to convey; that with respect to the issue of forgery, the finding of the
under Act 3344 is without legal effect and could not operate as constructive notice to document examiner is not conclusive; and that such issue was belied by petitioner
petitioners and third persons, hence, may not be used as basis for the application of Art. Veneranda Amodia herself when she declared that the negotiated sale in 1964 between
1544 of the New Civil Code; that the Notice of Adverse Claim of AZNAR was annotated on AZNAR and the Amodias was not consummated because the latter did not receive the full
TCT No. 20626 only on February 14, 1990 after the execution of the Deed of Extra-Judicial consideration for the subject property.
Settlement with Absolute Sale in favor of Go Kim Chuan on February 18, 1989, hence, the Before resolving the main issues raised, the Court shall first deal with an apparent
CA erred when it held that Go Kim Chuan was not a buyer in good faith for supposedly procedural lapse in this case.
having knowledge of such adverse claim; and that the doctrine laid down in Heirs of
Counsel for petitioners filed a Motion for Leave to Admit Amended Petition for Review
Severa Gregorio v. CA[35] is inapplicable since it referred to a case wherein the original
on Certiorari in order to implead the Heirs of the late Go Kim Chuan as the new petitioners
copy of the document under review was not produced in evidence while in the instant
and to delete the names of petitioners Amodias because they could no longer be located.
case, the original copy of the Extra-Judicial Partition of Real Estate with Deed of Absolute
Said petitioners sought the relaxation of the rules so that in the interest of justice, the case
Sale executed by the Amodias in favor of AZNAR was presented before the trial court
can be decided on the merits. AZNAR opposes the Amended Petition because it was
judge.
allegedly filed to cure a fatal defect in the original petition non-compliance with the rules
dismissible because the Verification and Certification of Non-Forum Shopping thereof were In this regard, the case of Iglesia ni Cristo v. Ponferrada[37] is instructive, viz.:
not signed by all the petitioners. AZNAR further claims that the Amended Petition was filed The purpose of verification is simply to secure an assurance that the
allegations of the petition (or complaint) have been made in good
in order to cure a fatal defect which should not be countenanced by this Court. AZNAR faith; or are true and correct, not merely speculative. This requirement
is simply a condition affecting the form of pleadings, and
also contends that Go Kim Chuan was a buyer in bad faith as he had prior constructive noncompliance therewith does not necessarily render it fatally
defective. Indeed, verification is only a formal, not a jurisdictional
notice that the subject property was sold to AZNAR because the sale was registered with requirement.
the Register of Deeds under Act 3344; that the 1964 sale was registered under Act 3344 The issue in the present case is not the lack of verification but the
sufficiency of one executed by only one of plaintiffs. This Court held
because the subject property was not actually covered by a Torrens title at the time; that in Ateneo de Naga University v. Manalo, that the verification
requirement is deemed substantially complied with when, as in the
there was no other mode of registration except under Act 3344; that Go Kim Chuan had to
present case, only one of the heirs-plaintiffs, who has sufficient
knowledge and belief to swear to the truth of the allegations in the
wait for the reconstitution of the lost title, hence, it could not be said that he examined any
petition (complaint), signed the verification attached to it. Such
verification is deemed sufficient assurance that the matters alleged in
certificate of title and could feign ignorance of the sale in favor of AZNAR; that the second
the petition have been made in good faith or are true and correct, not
sale did not transfer the subject property to Go Kim Chuan since it was no longer within the merely speculative.
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Land Titles and Deeds (Finals) 2017
Thus, we held in Iglesia ni Cristo that the commonality of interest is material and crucial to Forgery cannot be presumed. It must be proved by clear, positive and convincing evidence
relaxation of the Rules. and the burden of proof rests on the party alleging forgery. Handwriting experts are usually
denial of substantial justice, because it cannot be denied that the ends of justice are better
The RTC's finding with respect to the issue of forgery reads:
served when cases are determined on the merits after all parties are given full opportunity
After a thorough study of the pleadings and evidence of the parties, the
to ventilate their causes and defenses rather than on technicality or some procedural court finds that preponderance of evidence heavily tilts in favor of the
defendants. The document relied upon by the plaintiff in its claim of
imperfections.[38] ownership over the land in question, the extrajudicial partition and sale,
has been found by the document examiner of the PC Crime Laboratory
to be a forgery. Being a forgery, said document conveyed nothing in
The Issues favor of the plaintiff. Hence, plaintiff's claim of ownership over the same
has no more leg to stand on. x x x[40]
We now proceed to the merits of the case. From the issues raised, there are ultimately two
questions that require resolution: While it is true that the original document was produced before the RTC, the finding of
forgery relies wholly on the testimony of the document examiner. It falls short of the
required independent examination to be conducted by the trial court judge. Other than the
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Land Titles and Deeds (Finals) 2017
statement of the document examiner, the RTC decision contains no other basis to support In the case at bench, it is uncontroverted that the subject property was under the operation
its conclusion of the Torrens System even before the respective conveyances to AZNAR and Go Kim
of the existence of forgery. Accordingly, the CA was correct in rejecting the RTCs finding Chuan were made. AZNAR knew of this, and admits this as fact. Yet, despite this
and in applying the doctrine laid down in the case of Heirs of Severa Gregorio v. CA. knowledge, AZNAR registered the sale in its favor under Act 3344 on the contention that at
the time of sale, there was no title on file. We are not persuaded by such a lame excuse.
Act 3344 provides for the system of recording of transactions or claims over unregistered
Without doubt, we have here a case of double sale of registered land. Apropos is Article real estate[45] without prejudice to a third party with a better right. [46] But if the land is
1544 of the New Civil Code which provides: registered under the Land Registration Act (and therefore has a Torrens Title), and it is
sold and the sale is registered not under the Land Registration Act but under Act 3344, as
ART. 1544. If the same thing should have been sold to
different vendees, the ownership shall be transferred to the person who amended, such sale is not considered registered, as the term is used under Art. 1544 of
may have first taken possession thereof in good faith, if it should be
movable property. the New Civil Code.[47]
Should there be no inscription, the ownership shall pertain to favor of AZNAR was registered under Act No. 3344 and not under Act No. 496, the said
the person who in good faith was first in the possession; and, in the
absence thereof, to the person who presents the oldest title, provided document is deemed not registered.[48] Rather, it was the sale in favor of Go Kim Chuan
there is good faith.
which was registered under Act No. 496.
We have already ruled that the registration contemplated in this provision refers to AZNAR insists that since there was no Torrens title on file in 1964, insofar as the vendors,
registration under the Torrens System, which considers the act of registration as the AZNAR, and the Register of Deeds are concerned, the subject property was unregistered
operative act[41] that gives validity to the transfer or creates a lien upon the land. [42] This at the time. The contention is untenable. The fact that the certificate of title over the
rule precisely applies to cases involving conflicting rights over registered property and registered land is lost does not convert it into unregistered land. After all, a certificate of
those of innocent transferees who relied on the clean title of the properties.[43] Thus, we title is merely an evidence of ownership or title over the particular property described
held that registration must be done in the proper registry in order to bind the same. [44] therein.[49] This Court agrees with the petitioners that AZNAR should have availed itself of
the legal remedy of reconstitution of the lost certificate of title, instead of registration under
Act 3344. We note that in Aznar Brothers Realty Company v. Aying,[50]AZNAR, beset with
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Land Titles and Deeds (Finals) 2017
the similar problem of a lost certificate of title over a registered land, sought the the CA declared that Go Kim Chuan was not a buyer in good faith, because he should
reconstitution thereof. It is unfortunate that, in the instant case, despite the sale of the have respected such adverse claim or, at least, inquired into the validity thereof.
subject property way back in 1964 and the existence of the remedy of reconstitution at that
We do not agree.
time, AZNAR opted to register the same under the improper registry (Act 3344) and
allowed such status to lie undisturbed. From 1964 to 1989, AZNAR did not bother to have While factual issues are not within the province of this Court, as it is not a trier of facts and
the lost title reconstituted or even have the subject property declared under its name for is not required to examine the oral and documentary evidence de novo, this Court has the
taxation purposes. Vigilantibus, non dormientibus, jura subveniunt. Laws must come to the authority to review and, in proper cases, reverse the factual findings of lower courts in the
assistance of the vigilant, not of the sleepy. [51] following instances: (a) when the findings of fact of the trial court are in conflict with those
of the appellate court; (b) when the judgment of the appellate court is based on a
Although it is obvious that Go Kim Chuan registered the sale in his favor under Act 496 misapprehension of facts; and, (c) when the appellate court manifestly overlooked certain
while AZNAR did not, we still cannot make an outright award of the subject property to the relevant facts which, if properly considered, would justify a different conclusion.[53]
petitioners solely on that basis. For the law is clear:mere registration of title is not The instant case falls squarely within the foregoing exceptions.
with a piece of real property that someone claims an interest therein or that there is a right
Thus, to be able to enjoy priority status, the second purchaser must be in good faith, i.e.,
superior to that of the titled owner. [54] However, as pointed out by petitioners and as
he must have no knowledge of the previous alienation of the property by the vendor to
admitted by AZNAR, the Notice of Adverse Claim was annotated on TCT No. 20626 only
another. Notably, what is important for this purpose is not whether the second buyer is a
on February 4, 1990, after the lost certificate of title was reconstituted and after the
buyer in good faith, but whether he registers the second sale in good faith, meaning, he
issuance of said TCT in the name of Go Kim Chuan on December 1, 1989. It is, therefore,
does so without knowledge of any defect in the title over the property sold. [52]
absurd to say that Go Kim Chuan should be bound by
an adverse claim which was not previously annotated on the lost title or on the new one, or
To fully resolve the second question, therefore, it is imperative that we determine whether
be shackled by a claim which he did not have any knowledge of.
Go Kim Chuan was a registrant in good faith.
Citing Santiago v. Court of Appeals,[55] AZNAR contends that even if the adverse claim
The CA found that AZNAR registered its Notice of Adverse Claim ahead of the Deed of was annotated on TCT No. 20626 only on February 4, 1990, the prior registration of the
Extra-Judicial Settlement with Absolute Sale in favor of Go Kim Chuan. Because of this, sale in its favor under Act 3344 served as constructive notice to Go Kim Chuan and thus
negates the latter's claim of good faith, since the Court held in that case, Registration,
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
however, by the first buyer under Act 3344 can have the effect of constructive notice to the Finally, it is worth stressing that the Torrens system was adopted in this country because it
second buyer that can defeat his right as such buyer in good faith. was believed to be the most effective measure to guarantee the integrity of land titles and
to insure their indefeasibility once the claim of ownership is established and recognized. If
AZNAR's reliance on Santiago is misplaced. In Santiago, the first buyers registered the
a person purchases a piece of land on the assurance that the seller's title thereto is valid,
sale under the Torrens System, as can be inferred from the issuance of the TCT in their
he should not run the risk of losing his acquisition. If this were permitted, public confidence
names. There was no registration under Act 3344.Conversely, in the instant case, AZNAR
in the system would be eroded and land transactions would have to be attended by
registered the sale in its favor under Act 3344 despite its full knowledge that the subject
complicated and not necessarily conclusive investigations and proof of ownership. [59]
property is under the operation of the Torrens System. To repeat, there can be no
constructive notice to the second buyer through registration under Act 3344 if the property
WHEREFORE, the instant petition for review is GRANTED. The Decision of the Court of
is registered under the Torrens system.[56]
Appeals in CA-G.R. CV No. 51814 is REVERSED and SET ASIDE. The Decision of
Moreover, before buying the subject property, Go Kim Chuan made verifications with the the Regional Trial Court of Lapu-Lapu City, Branch 27, in Civil Case No. 2254-L,
Office of the City Assessor of Lapu-Lapu City and the Register of Deeds. He likewise is REINSTATED. No costs.
visited the premises of the subject property and found that nobody interposed any adverse
claim against the Amodias. After he decided to buy the subject property, he paid all taxes SO ORDERED.
in arrears, caused the publication of the Deed of Extra-Judicial Settlement with Absolute
Sale in a newspaper of general circulation, caused the reconstitution of the lost certificate
of title and caused the issuance of the assailed TCT in his name. [57] Given these
We also note that AZNAR's complaint for cancellation of title contains no allegation that the
(second) purchaser was aware of defects in his title. In the absence of such an allegation
and proof of bad faith, it would be grossly inappropriate for this Court to render judgment
against the purchaser who had already acquired title not only because of lack of evidence,
but also because of the indefeasibility and conclusiveness of such title. [58]
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Land Titles and Deeds (Finals) 2017
G.R. No. 149238 November 22, 2007 portion of the jurisdiction of Cainta, Rizal. He argued that Original Certificate of Title No.
108 (OCT No. 108) in respondents names, insofar as it included Lot No. 11703, CAD 688-
SIXTO ANTONIO, petitioner, D, is, therefore, null and void because it was obtained through fraudulent
misrepresentations and machinations.
vs.
SPS. SOFRONIO SANTOS & AURORA SANTOS, SPS. LUIS LIBERATO & ANGELINA
LIBERATO and SPS. MARIO CRUZ & VICTORIA CRUZ, respondents. In their Answer4 dated July 26, 1989, respondents averred that OCT No. 108 was duly
issued to them by the Register of Deeds for Metro Manila, District II, on May 20, 1977.
They alleged that prior to the issuance of OCT No. 108, they, as registered owners, had
RESOLUTION
always been in peaceful possession of the property and at no time had Antonio possessed
the property, nor did he ever make any claim against the said property.
QUISUMBING, J.:
The RTC of Antipolo, Rizal, Branch 72, in a Decision dated October 7, 1997 dismissed the
This is an appeal from the Decision1 dated July 31, 2001 of the Court of Appeals in CA- complaint and ordered Antonio to pay respondents moral damages and attorneys fees.
G.R. CV No. 58246, affirming, with modification, the Decision2 dated October 7, 1997 of The dispositive portion of the decision reads:
Branch 72, Regional Trial Court (RTC) in Antipolo, Rizal in Civil Case No. 1261-A. The
RTC had dismissed the complaint for Reconveyance, Annulment of Title and Damages
WHEREFORE, premises considered, judgment is hereby rendered DISMISSING
filed by petitioner Sixto Antonio against respondents.
the instant complaint, and orders plaintiff as follows:
In his complaint,3 Antonio alleged that he is the absolute owner of a 13,159-square meter SO ORDERED.5
parcel of land denominated as Lot No. 11703, CAD 688-D, Cainta-Taytay Cadastre,
situated in Barangay San Juan, Cainta, Rizal. He averred that, as evidenced by certificates The Court of Appeals in a Decision dated July 31, 2001 affirmed with modification the
of payment of realty taxes for the years 1918 and 1919, the property was previously owned abovementioned decision by deleting the award of moral damages and attorneys fees.
by his father and that in 1984, he filed before Branch 71, RTC, Antipolo, Rizal, an The dispositive portion of the decision of the Court of Appeals states:
application for the registration of two parcels of land, one of which was Lot No. 11703,
CAD 688-D, situated in Barangay San Juan, Cainta, Rizal. His application was docketed WHEREFORE, with modification deleting [or] setting aside the award for moral
as Land Registration Case No. 142-A (LRC No. 142-A). damages and attorneys fees, the decision appealed from is AFFIRMED with
costs against the plaintiff-appellant.
Although the RTC, Branch 71, declared him the true and absolute owner in fee simple of
the two parcels of land he applied for, it set aside its decision with respect to Lot No. SO ORDERED.6
11703, CAD 688-D in an Order dated August 21, 1986, to avoid duplication of issuance of
titles.
Hence, the instant petition, raising the following issues:
Antonio said that after investigation, he discovered that Lot No. 11703, CAD 688-D was
already titled in the name of respondents. He then filed the complaint for Reconveyance, I.
Annulment of Title and Damages against respondents, averring that respondents
committed fraud in their application for titling because they made it appear in their THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED IN NOT
application for registration that the subject property was located in Pinagbuhatan, Pasig, HOLDING THAT THE DECISION IN LAND REGISTRATION CASE NO. 142-A,
Rizal, when in fact, the property is located in Barangay San Juan, Cainta, Rizal. He added, LRC RECORD NO. 58707, REGIONAL TRIAL COURT OF ANTIPOLO CITY,
respondents also made it appear in their application for registration that the subject BRANCH 71, IS SUFFICIENT BASIS OF PETITIONERS CLAIM OF RIGHT OF
property is bound on the North East by the Pasig River when in fact it is bound on the OWNERSHIP OVER THE PROPERTY SUBJECT OF ACTION FOR
North East by the Tapayan River. Furthermore, the Pasig River does not traverse any RECONVEYANCE.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
II. After serious consideration, we find that petitioners arguments lack merit.
THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED IN TREATING On the first issue, petitioner argues that in LRC No. 142-A, the RTC of Antipolo, Branch
PETITIONERS ACTION FOR RECONVEYANCE AS ONE FOR TITLING OF A 71, rendered a Decision on January 7, 1986 adjudicating ownership of two lots, including
PARCEL OF LAND. Lot No. 11703, CAD 688-D, in his favor. He adds that on February 19, 1986, after said
decision has become final and executory, the said RTC issued a certification for issuance
III. of decree, directing the Land Registration Commission to issue the corresponding decree
of registration. Hence, he argues, his right of ownership over the land has already been
fully established, but no certificate of title was issued to him only because the property was
THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED IN NOT already registered in the name of respondents.
HOLDING THAT RESPONDENTS HAVE FRAUDULENTLY REGISTERED AND
TITLED SUBJECT PROPERTY IN THEIR NAMES.
But we agree with respondents that petitioner cannot rely on the decision in LRC No. 142-
A. As pointed out by the Court of Appeals, even if a title had been issued to petitioner
IV. based on said decision, his title would be of a later date than the title of respondents,
hence inefficacious and ineffective. This Court has ruled that, when two certificates of title
THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED IN HOLDING are issued to different persons covering the same land in whole or in part, the earlier in
THAT RESPONDENTS MOTHER ACQUIRED SUBJECT PROPERTY FROM date must prevail; and in case of successive registrations where more than one certificate
HER FATHER, GAVINO SANTOS, WHICH THE LATTER ALLEGEDLY is issued over the same land, the person holding a prior certificate is entitled to the land as
PURCHASED FROM LADISLAO RIVERA. against a person who relies on a subsequent certificate. 9
V. On the second issue, petitioner contends that it is very apparent the RTC and Court of
Appeals had the notion that his case a quo was not an action for reconveyance, but rather
an application for registration of land where the applicant and oppositor had to prove their
THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED IN AFFIRMING respective registrable titles. This, he adds, could be gleaned from the RTCs findings that
THE DECISION OF THE COURT A QUO DISMISSING PETITIONERS ACTION "the claim of plaintiff on the basis of said documents cannot prevail over the adverse,
FOR RECONVEYANCE.7 public, open, peaceful and continuous possession by the defendants over the subject
property," and that "it was indubitably shown that the defendants have occupied said
Simply put, the issues raised are: (1) Did the Court of Appeals err in not holding that the property since time immemorial while plaintiff has never at anytime taken possession of
decision in LRC No. 142-A was sufficient basis of petitioners claim of ownership over the said property."
subject property? (2) Did the Court of Appeals and RTC erroneously treat petitioners
action for reconveyance as one for titling of a parcel of land? (3) Did respondents We find petitioners contentions unconvincing. For an action for reconveyance based on
fraudulently title the subject property in their names? (4) Did the Court of Appeals err in fraud to prosper, this Court has held that the party seeking reconveyance must prove by
finding that respondents mother acquired the subject property from her father, Gavino clear and convincing evidence his title to the property and the fact of fraud. 10 The RTC, in
Santos, who purchased it from Ladislao Rivera? and (5) Did the Court of Appeals err in making the abovementioned findings, was not treating petitioners action for reconveyance
affirming the decision of the RTC dismissing petitioners action for reconveyance? as one for titling of property. But it was weighing whether petitioner has, by clear and
convincing evidence, proven his title to the property. Moreover, the RTC, in its decision,
Petitioner argues that the Court of Appeals erred in not holding that the decision in LRC discussed the merits of petitioners ground for his action for reconveyance, i.e. whether or
No. 142-A is sufficient basis for his claim of ownership over the property; in treating his not respondents committed fraud in titling the subject property in their names. The RTC
action for reconveyance as one for titling; in not holding that respondents had fraudulently held that as shown by public records in the custody of the RTC, Pasig City and the Land
registered the property in their names; and in holding that respondents mother had Registration Authority, petitioners claim that the property was fraudulently titled in the
acquired the subject property from her father, Gavino Santos, who allegedly bought the names of respondents is baseless. Thus, petitioners contention that the RTC and the
property from Ladislao Rivera. Court of Appeals treated his action for reconveyance as one for titling of property lacks any
persuasive basis.
Respondents, on the other hand, in their Comments, 8 contend that they have proved they
have a better title to the property. They argue that petitioners attempt to register Lot No. On the third and fourth issues, we find them to be factual issues, hence beyond our
11703, CAD 688-D in his name is tainted with fraud, and that petitioner had failed to jurisdiction to resolve. In a petition for review under Rule 45 of the 1997 Rules of Civil
adduce any evidence of fraud on their part. They assert that their documentary and Procedure, this Courts power of review is limited to questions of law only. 11
testimonial evidence which were unrebutted by petitioner show original ownership of the
land by Ladislao Rivera from whom their grandfather bought the property.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Note, however, should be taken of the established doctrine that an action for G.R. No. 196577 February 25, 2013
reconveyance resulting from fraud prescribes four years from the discovery of the fraud.
Such discovery is deemed to have taken place upon the issuance of the certificate of title LAND BANK OF THE PHILIPPINES, Petitioner,
over the property. Registration of real property is considered a constructive notice to all
vs.
persons, thus, the four-year period shall be counted therefrom.12 It appears that OCT No. BARBARA SAMPAGA POBLETE, Respondent.
108 was issued to respondents by the Register of Deeds for Metro Manila on May 20,
1977. From the time of registration of the land in the name of respondents on May 20,
1977 to the filing of the complaint on September 19, 1988, more than four years had DECISION
already elapsed. Hence, it cannot be denied that petitioners action had already
prescribed. CARPIO, J.:
Based on the foregoing considerations, we find that the Court of Appeals did not err in The Case
affirming the decision of the RTC dismissing petitioners action for reconveyance.
This Petition for Review on Certiorari 1 seeks to reverse the Court of Appeals'
Finally, concerning the deletion of moral damages and attorneys fees, we agree with the Decision2 dated 28 September 20 I 0 and its Resolution3 dated 19 April 2011 in C A-G.R.
ruling of the Court of Appeals that here an award of moral damages is not warranted since CV No. 91666. The Court of Appeals (C A) affirmed in toto the Decision4 of the Regional
the record is bereft of any proof that Antonio acted maliciously or in bad faith in filing the Trial Court (RTC) of San Jose, Occidental Mindoro, Branch 46, in Civil Case No. R-1331.
action.13 Neither should attorneys fees be awarded. The accepted rule is that the reason
for the award of attorneys fees must be stated in the text of the trial courts decision;
otherwise, if it is stated only in the dispositive portion of the decision, the same must be The Facts
disallowed.14 In this case, we find that the trial courts decision failed to show the reason
for the award of attorneys fees, hence it was properly deleted by the appellate court. The facts, as culled from the records, are as follows:
WHEREFORE, the petition is DENIED for lack of merit. The assailed Decision dated July Petitioner Land Bank of the Philippines (Land Bank) is a banking institution organized and
31, 2001 of the Court of Appeals in CA-G.R. CV No. 58246 is AFFIRMED. No existing under Philippine laws. Respondent Barbara Sampaga Poblete (Poblete) is the
pronouncement as to costs. registered owner of a parcel of land, known as Lot No. 29, with an area of 455 square
meters, located in Buenavista, Sablayan, Occidental Mindoro, under Original Certificate of
SO ORDERED. Title (OCT) No. P-12026. In October 1997, Poblete obtained a 300,000.00 loan from
Kabalikat ng Pamayanan ng Nagnanais Tumulong at Yumaman Multi-Purpose
Cooperative (Kapantay). Poblete mortgaged Lot No. 29 to Kapantay to guarantee payment
of the loan. Kapantay, in turn, used OCT No. P-12026 as collateral under its Loan Account
No. 97-CC-013 with Land Bank-Sablayan Branch.
In November 1998, Poblete decided to sell Lot No. 29 to pay her loan. She instructed her
son-in-law Domingo Balen (Balen) to look for a buyer. Balen referred Angelito Joseph
Maniego (Maniego) to Poblete. According to Poblete, Maniego agreed to buy Lot No. 29
for 900,000.00, but Maniego suggested that a deed of absolute sale for 300,000.00 be
executed instead to reduce the taxes. Thus, Poblete executed the Deed of Absolute Sale
dated 9 November 1998 (Deed dated 9 November 1998) with 300,000.00 as
consideration.5 In the Deed dated 9 November 1998, Poblete described herself as a
"widow." Poblete, then, asked Balen to deliver the Deed dated 9 November 1998 to
Maniego and to receive the payment in her behalf. Balen testified that he delivered the
Deed dated 9 November 1998 to Maniego. However, Balen stated that he did not receive
from Maniego the agreed purchase price. Maniego told Balen that he would pay the
amount upon his return from the United States. In an Affidavit dated 19 November 1998,
Poblete stated that she agreed to have the payment deposited in her Land Bank Savings
Account.6
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Based on a Certification issued by Land Bank-Sablayan Branch Department Manager WHEREFORE, by preponderance of evidence, judgment is hereby rendered in favor of the
Marcelino Pulayan on 20 August 1999, 7 Maniego paid Kapantays Loan Account No. 97- plaintiff and against the defendants, as follows:
CC-013 for 448,202.08. On 8 June 2000, Maniego applied for a loan of 1,000,000.00
with Land Bank, using OCT No. P 12026 as collateral. Land Bank alleged that as a
1. Declaring the Deed of Sale dated August 11, 2000 over O.C.T. No. P-12026,
condition for the approval of the loan, the title of the collateral should first be transferred to as null and void;
Maniego.
2. Declaring Transfer of Certificate of Title No. T-20151 as null and void, it having
On 14 August 2000, pursuant to a Deed of Absolute Sale dated 11 August 2000 (Deed
been issued on the basis of a spurious and forged document;
dated 11 August 2000),8the Register of Deeds of Occidental Mindoro issued Transfer
Certificate of Title (TCT) No. T-20151 in Maniegos name. On 15 August 2000, Maniego
and Land Bank executed a Credit Line Agreement and a Real Estate Mortgage over TCT 3. The preliminary [i]njunction issued directing the defendants to refrain from
No. T- 20151. On the same day, Land Bank released the 1,000,000.00 loan proceeds to proceedings [sic] with the auction sale of the plaintiffs properties, dated February
Maniego. Subsequently, Maniego failed to pay the loan with Land Bank. On 4 November 10, 2002, is hereby made permanent;
2002, Land Bank filed an Application for Extra-judicial Foreclosure of Real Estate
Mortgage stating that Maniegos total indebtedness amounted to 1,154,388.88. 4. Ordering defendant Angelito Joseph Maniego to return to the plaintiff O.C.T.
No. P-12026; and
On 2 December 2002, Poblete filed a Complaint for Nullification of the Deed dated 11
August 2000 and TCT No. T-20151, Reconveyance of Title and Damages with Prayer for 5. Ordering defendant Angelito Joseph Maniego to pay plaintiff the amount of
Temporary Restraining Order and/or Issuance of Writ of Preliminary Injunction. Named 50,000.00, as and for reasonable attorneys fees.
defendants were Maniego, Land Bank, the Register of Deeds of Occidental Mindoro and
Elsa Z. Aguirre in her capacity as Acting Clerk of Court of RTC San Jose, Occidental
Mindoro. In her Complaint, Poblete alleged that despite her demands on Maniego, she did Judgment is furthermore rendered on the cross-claim of defendant Land Bank of the
not receive the consideration of 900,000.00 for Lot No. 29. She claimed that without her Philippines against defendant Angelito Joseph Maniego, as follows:
knowledge, Maniego used the Deed dated 9 November 1998 to acquire OCT No. P-12026
from Kapantay. Upon her verification with the Register of Deeds, the Deed dated 11 A. Ordering defendant Angelito Joseph Maniego to pay his co-defendant [L]and
August 2000 was used to obtain TCT No. T-20151. Poblete claimed that the Deed dated Bank of the Philippines his loan with a principal of 1,000,000.00, plus interests,
11 August 2000 bearing her and her deceased husbands, Primo Poblete, supposed penalties and other charges thereon; and
signatures was a forgery as their signatures were forged. As proof of the forgery, Poblete
presented the Death Certificate dated 27 April 1996 of her husband and Report No. 294-
502 of the Technical Services Department of the National Bureau of Investigation showing B. Ordering defendant Angelito Joseph Maniego to pay the costs of this suit.
that the signatures in the Deed dated 11 August 2000 were forgeries. Accordingly, Poblete
also filed a case for estafa through falsification of public document against Maniego and SO ORDERED.9
sought injunction of the impending foreclosure proceeding.
The RTC ruled that the sale between Poblete and Maniego was a nullity. The RTC found
On 7 January 2003, Land Bank filed its Answer with Compulsory Counterclaim and Cross- that the agreed consideration was 900,000.00 and Maniego failed to pay the
claim. Land Bank claimed that it is a mortgagee in good faith and it observed due diligence consideration. Furthermore, the signatures of Poblete and her deceased husband were
prior to approving the loan by verifying Maniegos title with the Office of the Register of proven to be forgeries. The RTC also ruled that Land Bank was not a mortgagee in good
Deeds. Land Bank likewise interposed a cross-claim against Maniego for the payment of faith because it failed to exercise the diligence required of banking institutions. The RTC
the loan, with interest, penalties and other charges. Maniego, on the other hand, explained that had Land Bank exercised due diligence, it would have known before
separately filed his Answer. Maniego denied the allegations of Poblete and claimed that it approving the loan that the sale between Poblete and Maniego had not been
was Poblete who forged the Deed dated 11 August 2000. He also alleged that he paid the consummated. Nevertheless, the RTC granted Land Banks cross-claim against Maniego.
consideration of the sale to Poblete and even her loans from Kapantay and Land Bank.
In an Order dated 17 March 2008, the RTC denied the Motion for Reconsideration filed by
The Ruling of the Regional Trial Court Land Bank for want of merit. Thereafter, Land Bank and Maniego separately challenged
the RTCs Decision before the CA.
On 28 December 2007, the RTC of San Jose, Occidental Mindoro, Branch 46, rendered a
Decision in favor of Poblete, the dispositive portion of which reads: The Ruling of the Court of Appeals
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
On 28 September 2010, the CA promulgated its Decision affirming in toto the Decision of consideration for the sale. Since the issue on the genuineness of the Deed dated 11
the RTC.10 Both Land Bank and Maniego filed their Motions for Reconsideration but the August 2000 is essentially a question of fact, we are not dutybound to analyze and weigh
CA denied both motions on 19 April 2011.11 the evidence again.16
In a Resolution dated 13 July 2011,12 the Second Division of this Court denied the Petition It is a well-entrenched rule, as aptly applied by the CA, that a forged or fraudulent deed is
for Review on Certiorari filed by Maniego. This Resolution became final and executory on a nullity and conveys no title.17 Moreover, where the deed of sale states that the purchase
19 January 2012. price has been paid but in fact has never been paid, the deed of sale is void ab initio for
lack of consideration.18 Since the Deed dated 11 August 2000 is void, the corresponding
On the other hand, Land Bank filed this petition. TCT No. T-20151 issued pursuant to the same deed is likewise void. In Yu Bun Guan v.
Ong,19the Court ruled that there was no legal basis for the issuance of the certificate of title
and the CA correctly cancelled the same when the deed of absolute sale was completely
The Issues simulated, void and without effect. In Erea v. Querrer-Kauffman,20 the Court held that
when the instrument presented for registration is forged, even if accompanied by the
Land Bank seeks a reversal and raises the following issues for resolution: owners duplicate certificate of title, the registered owner does not thereby lose his title,
and neither does the mortgagee acquire any right or title to the property. In such a case,
the mortgagee under the forged instrument is not a mortgagee protected by law. 21
1. THE COURT OF APPEALS (FORMER SPECIAL ELEVENTH DIVISION)
ERRED IN UPHOLDING THE FINDING OF THE TRIAL COURT DECLARING
TCT NO. T-20151 AS NULL AND VOID. THE COURT OF APPEALS The issue on the nullity of Maniegos title had already been foreclosed when this Court
MISCONSTRUED AND MISAPPRECIATED THE EVIDENCE AND THE LAW IN denied Maniegos petition for review in the Resolution dated 13 July 2011, which became
NOT FINDING TCT NO. T-20151 REGISTERED IN THE NAME OF ANGELITO final and executory on 19 January 2012.22 It is settled that a decision that has acquired
JOSEPH MANIEGO AS VALID. finality becomes immutable and unalterable and may no longer be modified in any respect,
even if the modification is meant to correct erroneous conclusions of fact or law and
whether it will be made by the court that rendered it or by the highest court of the
2. THE COURT OF APPEALS (FORMER SPECIAL ELEVENTH DIVISION) land.23 This is without prejudice, however, to the right of Maniego to recover from Poblete
MISCONSTRUED THE EVIDENCE AND THE LAW IN NOT FINDING LAND what he paid to Kapantay for the account of Poblete, otherwise there will be unjust
BANK A MORTGAGEE IN GOOD FAITH. enrichment by Poblete.
3. THE COURT OF APPEALS (FORMER SPECIAL ELEVENTH DIVISION) Since TCT No. T-20151 has been declared void by final judgment, the Real Estate
MISCONSTRUED THE EVIDENCE AND THE LAW IN NOT FINDING THE Mortgage constituted over it is also void. In a real estate mortgage contract, it is essential
RESPONDENT AND ANGELITO JOSEPH MANIEGO AS IN PARI DELICTO. that the mortgagor be the absolute owner of the property to be mortgaged; otherwise, the
mortgage is void.24
4. THE COURT OF APPEALS (FORMER SPECIAL ELEVENTH DIVISION)
ERRED IN NOT APPLYING THE PRINCIPLE OF ESTOPPEL OR LACHES ON Land Bank insists that it is a mortgagee in good faith since it verified Maniegos title, did a
RESPONDENT IN THAT THE PROXIMATE CAUSE OF HER LOSS WAS HER credit investigation, and inspected Lot No. 29. The issue of being a mortgagee in good
NEGLIGENCE TO SAFEGUARD HER RIGHTS OVER THE SUBJECT faith is a factual matter, which cannot be raised in this petition.25 However, to settle the
PROPERTY, THEREBY ENABLING ANGELITO JOSEPH MANIEGO TO issue, we carefully examined the records to determine whether or not Land Bank is a
MORTGAGE THE SAME WITH LAND BANK.13 mortgagee in good faith.1wphi1
The Ruling of the Court There is indeed a situation where, despite the fact that the mortgagor is not the owner of
the mortgaged property, his title being fraudulent, the mortgage contract and any
We do not find merit in the petition. foreclosure sale arising therefrom are given effect by reason of public policy. 26 This is the
doctrine of "the mortgagee in good faith" based on the rule that buyers or mortgagees
dealing with property covered by a Torrens Certificate of Title are not required to go
A petition for review under Rule 45 of the Rules of Court specifically provides that only beyond what appears on the face of the title. 27 However, it has been consistently held that
questions of law may be raised, subject to exceptional circumstances14 which are not this rule does not apply to banks, which are required to observe a higher standard of
present in this case. Hence, factual findings of the trial court, especially if affirmed by the diligence.28 A bank whose business is impressed with public interest is expected to
CA, are binding on us.15 In this case, both the RTC and the CA found that the signatures of exercise more care and prudence in its dealings than a private individual, even in cases
Poblete and her deceased husband in the Deed dated 11 August 2000 were forged by involving registered lands.29 A bank cannot assume that, simply because the title offered
Maniego. In addition, the evidence is preponderant that Maniego did not pay the
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Land Titles and Deeds (Finals) 2017
as security is on its face free of any encumbrances or lien, it is relieved of the responsibility On the allegation that Poblete is in pari delicto with Maniego, we find the principle
of taking further steps to verify the title and inspect the properties to be mortgaged. 30 inapplicable. The pari delicto rule provides that "when two parties are equally at fault, the
law leaves them as they are and denies recovery by either one of them." 40 We adopt the
factual finding of the RTC and the CA that only Maniego is at fault.
Applying the same principles, we do not find Land Bank to be a mortgagee in good faith.
Finally, on the issues of estoppel and laches, such were not raised before the trial
Good faith, or the lack of it, is a question of intention. 31 In ascertaining intention, courts are
necessarily controlled by the evidence as to the conduct and outward acts by which alone court.1wphi1 I fence, we cannot rule upon the same. It is settled that an issue which was
neither alleged in the complaint nor raised during the trial cannot be raised for the tirst time
the inward motive may, with safety, be determined. 32
on appeal, as such a recourse would be offensive to the basic rules of t}1ir play, justice
and due process, since the opposing party would be deprived of the opp01iunity to
Based on the evidence, Land Bank processed Maniegos loan application upon his introduce evidence rebutting such new issue. 41
presentation of OCT No. P-12026, which was still under the name of Poblete. Land Bank
even ignored the fact that Kapantay previously used Pobletes title as collateral in its loan
account with Land Bank.33 In Bank of Commerce v. San Pablo, Jr.,34 we held that when WHEREFORE, we DENY the petition. We AFFIRM the 28 September 2010 Decision and
the 19 April 2011 Resolution of the Court of Appeals in CA-Ci.R. CV No. 91666. The
"the person applying for the loan is other than the registered owner of the real property
being mortgaged, [such fact] should have already raised a red flag and which should have injunction against the foreclosure proceeding, issued by the Regional Trial Court of San
induced the Bank x x x to make inquiries into and confirm x x x [the] authority to mortgage Jose, Occidental Mindoro, Branch 46, is made permanent. Costs against Land Bank.
x x x. A person who deliberately ignores a significant fact that could create suspicion in an
otherwise reasonable person is not an innocent purchaser for value." SO ORDERED.
The records do not even show that Land Bank investigated and inspected the property to
ascertain its actual occupants. Land Bank merely mentioned that it inspected Lot No. 29 to
appraise the value of the property. We take judicial notice of the standard practice of
banks, before approving a loan, to send representatives to the premises of the land offered
as collateral to investigate its real owners. 35 In Prudential Bank v. Kim Hyeun Soon,36 the
Court held that the bank failed to exercise due diligence although its representative
conducted an ocular inspection, because the representative concentrated only on the
appraisal of the property and failed to inquire as to who were the then occupants of the
property.
Land Bank claims that it conditioned the approval of the loan upon the transfer of title to
Maniego, but admits processing the loan based on Maniegos assurances that title would
soon be his.37 Thus, only one day after Maniego obtained TCT No. T-20151 under his
name, Land Bank and Maniego executed a Credit Line Agreement and a Real Estate
Mortgage. Because of Land Banks haste in granting the loan, it appears that Maniegos
loan was already completely processed while the collateral was still in the name of
Poblete. This is also supported by the testimony of Land Bank Customer Assistant
Andresito Osano.38
Where the mortgagee acted with haste in granting the mortgage loan and did not ascertain
the ownership of the land being mortgaged, as well as the authority of the supposed agent
executing the mortgage, it cannot be considered an innocent mortgagee. 39
Since Land Bank is not a mortgagee in good faith, it is not entitled to protection. The
injunction against the foreclosure proceeding in the present case should be made
permanent. Since Lot No. 29 has not been transferred to a third person who is an innocent
purchaser for value, ownership of the lot remains with Poblete. This is without prejudice to
the right of either party to proceed against Maniego.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
[G.R. No. 94457. October 16, 1997] on the part of petitioners counsel who failed to file an answer and, later, a petition for relief
from judgment by default. Upon notice of the Court of Appeals decision, Atty. Coronel
again neglected to protect his clients interest by failing to file a motion for reconsideration
or to appeal therefrom until said decision became final on December 21, 1989.
VICTORIA LEGARDA, petitioner, vs. THE HONORABLE COURT OF APPEALS, NEW Sometime in March 1990, Legarda learned of the adverse decision of the Court of
CATHAY HOUSE, INC., THE HONORABLE REGIONAL TRIAL COURT OF Appeals dated November 29, 1989, not from Atty. Coronel but from his secretary. She then
QUEZON CITY, BRANCH 94, respondents. hired a new counsel for the purpose of elevating her case to this Court. The new lawyer
filed a petition for certiorari praying for the annulment of the decision of the trial and
RESOLUTION appellate courts and of the sheriffs sale, alleging, among other things, that Legarda lost in
the courts below because her previous lawyer was grossly negligent and inefficient, whose
ROMERO, J.: omissions cannot possibly bind her because this amounted to a violation of her right to due
process of law. She, therefore, asked Cathay (not Cabrera) to reconvey the subject
property to her.
For our resolution is the motion for reconsideration of the March 18, 1991, decision of
the Courts's First Division, filed by private respondents New Cathay House, Inc. On March 18, 1991, a decision[4] was rendered in this case by Mr. Justice Gancayco,
(Cathay). A brief narration of facts is in order. ruling, inter alia, as follows: (a) granting the petition; (b) nullifying the trial courts decision
dated March 25, 1985, the Court of Appeals decision dated November 29, 1989, the
The parties hereto entered into a lease agreement over a certain Quezon City Sheriffs Certificate of Sale dated June 27, 1985, of the property in question, and the
property owned by petitioner Victoria Legarda. For some reason or another, she refused to subsequent final deed of sale covering the same property; and (c) ordering Cathay to
sign the contract although respondent lessee, Cathay, made a deposit and a down reconvey said property to Legarda, and the Register of Deeds to cancel the registration of
payment of rentals, prompting the latter to file before the Regional Trial Court of Quezon said property in the name of Cathay (not Cabrera) and to issue a new one in Legardas
City, Branch 94 a complaint[1] against the former for specific performance with preliminary name.
injunction and damages. The court a quo issued the injunction. In the meantime, Legardas
counsel, noted lawyer Dean Antonio Coronel, requested a 10-day extension of time to file The Court then declared that Atty. Coronel committed, not just ordinary or simple
an answer which the court granted. Atty. Coronel, however, failed to file an answer within negligence, but reckless, inexcusable and gross negligence, which deprived his client of
the extended period. His client was eventually declared in default, Cathay was allowed to her property without due process of law. His acts, or the lack of it, should not be allowed to
present evidence ex-parte, and on March 25, 1985, a judgment by default was reached by bind Legarda who has been consigned to penury because her lawyer appeared to have
the trial court ordering Legarda to execute the lease contract in favor of, and to pay abandoned her case not once but repeatedly. Thus, the Court ruled against tolerating such
damages to, Cathay. unjust enrichment of Cathay at Legardas expense, and noted that counsels lack of
devotion to duty is so gross and palpable that this Court must come to the aid of his
On April 9, 1985, a copy of said decision was served on Atty. Coronel but he took no distraught client.
action until the judgment became final and executory. A month later, the trial court issued a
writ of execution and a public auction was held where Cathays manager, Roberto V. Aggrieved by this development, Cathay filed the instant motion for reconsideration,
Cabrera, Jr., as highest bidder, was awarded the property for P376,500.00 in satisfaction alleging, inter alia, that reconveyance is not possible because the subject property had
of the judgment debt. Consequently, a Certificate of Sale was issued by the sheriff on June already been sold by its owner, Cabrera, even prior to the promulgation of said decision.
27, 1985. Upon failure of Legarda to redeem her property within the one-year redemption
period, a Final Deed of Sale was issued by the sheriff on July 8, 1986, which was By virtue of the Gancayco decision, Cathay was duty bound to return the subject
registered by Cabrera with the Register of Deeds three days later. Hence, Legardas property to Legarda. The impossibility of this directive is immediately apparent, for two
Transfer Certificate of Title (TCT) No. 270814 was cancelled with the issuance of TCT No. reasons: First, Cathay neither possessed nor owned the property so it is in no position to
350892 in the name of Cabrera. reconvey the same; second, even if it did, ownership over the property had already been
validly transferred to innocent third parties at the time of promulgation of said judgment.
Despite the lapse of over a year since the judgment by default became final and
executory, Atty. Coronel made no move on behalf of his client. He did not even inform her There is no question that the highest bidder at the public auction was Cathays
of all these developments. When Legarda did learn of the adverse decision, she manager. It has not been shown nor even alleged, however, that Roberto Cabrera had all
nevertheless did not lose faith in her counsel [2] and prevailed upon him to seek appropriate the time been acting for or in behalf of Cathay. For all intents and purposes, Cabrera was
relief. Thus, on October 23, 1986, he filed a petition for annulment of judgment with prayer simply a vendee whose payment effectively extinguished Legardas liability to Cathay as
for the issuance of a writ of preliminary mandatory injunction before the Court of Appeals. [3] the judgment creditor. No proof was ever presented which would reveal that the sale
occurred only on paper, with Cabrera acting as a mere conduit for Cathay. What is clear
On November 29, 1989, the appellate court rendered a decision affirming the March from the records is that the auction sale was conducted regularly, that a certificate of sale
25, 1985, decision of the trial court, dismissing the petition for annulment of judgment, and and, subsequently, a final deed of sale were issued to Cabrera which allowed him to
holding Legarda bound by the negligence of her counsel. It considered her allegation of consolidate his ownership over the subject property, register it and obtain a title in his own
fraud by Cathay to be improbable, and added that there was pure and simple negligence name, and sell it to Nancy Saw, an innocent purchaser for value, at a premium
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
price. Nothing on record would demonstrate that Cathay was the beneficiary of the sale damages was established.[11] It was a payment in the sense that Cathay had to resort to a
between Cabrera and Saw. Cabrera himself maintained that he was acting in his private court-supervised auction sale in order to execute the judgment. [12] With the fulfillment of the
(as distinct from his corporate) capacity[5] when he participated in the bidding. judgment debtors obligation, nothing else was required to be done.
Since the decision of the Court of Appeals gained finality on December 21, 1989, the Under the Gancayco ruling, the order of reconveyance was premised on the alleged
subject property has been sold and ownership thereof transferred no less than three gross negligence of Legardas counsel which should not be allowed to bind her as she was
times, viz.: (a) from Cabrera to Nancy Saw on March 21, 1990, four months after the deprived of her property without due process of law.
decision of the Court of Appeals became final and executory and one year before the
promulgation of the March 18, 1991, decision under reconsideration; (b) from Nancy Saw It is, however, basic that as long as a party was given the opportunity to defend her
to Lily Tanlo Sy Chua on August 7, 1990, more than one year before the Court issued a interests in due course, she cannot be said to have been denied due process of law, for
temporary restraining order in connection with this case; and (c) from the spouses Victor this opportunity to be heard is the very essence of due process. The chronology of events
and Lily Sy Chua to Janet Chong Luminlun on April 3, 1992. With these transfers, shows that the case took its regular course in the trial and appellate courts but Legardas
Cabreras TCT No. 350892 gave way to Saws TCT No. 31672, then to Chuas TCT No. counsel failed to act as any ordinary counsel should have acted, his negligence every step
31673, and finally to Luminluns TCT No. 99143, all issued by the Register of Deeds of of the way amounting to abandonment, in the words of the Gancayco decision. Yet, it
Quezon City on April 3, 1990, August 8, 1990, and November 24, 1993, respectively. cannot be denied that the proceedings which led to the filing of this case were not attended
by any irregularity. The judgment by default was valid, so was the ensuing sale at public
We do not have to belabor the fact that all the successors-in-interest of Cabrera to auction. If Cabrera was adjudged highest bidder in said auction sale, it was not through
the subject lot were transferees for value and in good faith, having relied as they did on the any machination on his part. All of his actuations that led to the final registration of the title
clean titles of their predecessors. The successive owners were each armed with their own in his name were aboveboard, untainted by any irregularity.
indefeasible titles which automatically brought them under the aegis of the Torrens
System. As the Court declared in Sandoval v. Court of Appeals, [6] (i)t is settled doctrine The fact that Cabrera is an officer of Cathay does not make him a purchaser in bad
that one who deals with property registered under the Torrens system need not go beyond faith. His act in representing the company was never questioned nor disputed by
the same, but only has to rely on the title. He is charged with notice only of such burdens Legarda. And while it is true that he won in the bidding, it is likewise true that said bidding
and claims as are annotated on the title.[7] In the case at bar, it is not disputed that no was conducted by the book. There is no call to be alarmed that an official of the company
notice of lis pendens was ever annotated on any of the titles of the subsequent emerges as the winning bidder since in some cases, the judgment creditor himself
owners. And even if there were such a notice, it would not have created a lien over the personally participates in the bidding.
property because the main office of a lien is to warn prospective buyers that the property
There is no gainsaying that Legarda is the judgment debtor here. Her property was
they intend to purchase is the subject of a pending litigation. Therefore, since the property
sold at public auction to satisfy the judgment debt. She cannot claim that she was illegally
is already in the hands of Luminlun, an innocent purchaser for value, it can no longer be
deprived of her property because such deprivation was done in accordance with the rules
returned to its original owner by Cabrera, much less by Cathay itself.
on execution of judgments. Whether the money used to pay for said property came from
Another point to consider, though not raised as an issue in this case, is the fact that the judgment creditor or its representative is not relevant. What is important is that it was
Cabrera was impleaded as a party-respondent only on August 12, 1991, after the purchased for value. Cabrera parted with real money at the auction. In his Sheriffs
promulgation of the Gancayco decision.[8] The dispositive portion itself ordered Cathay, Certificate of Sale dated June 27, 1985, [13] Deputy Sheriff Angelito R. Mendoza
instead of Cabrera to reconvey the property to Legarda. Cabrera was never a party to this certified, inter alia, that the highest bidder paid to the Deputy Sheriff the said amount
case, either as plaintiff-appellee below or as respondent in the present action. Neither did of P376,500.00, the sale price of the levied property. If this does not constitute payment,
he ever act as Cathays representative. As we held in the recent case of National Power what then is it? Had there been no real purchase and payment below, the subject property
Corporation v. NLRC, et al.,[9] (j)urisdiction over a party is acquired by his voluntary would never have been awarded to Cabrera and registered in his name, and the judgment
appearance or submission to the court or by the coercive process issued by the court to debt would never have been satisfied. Thus, to require either Cathay or Cabrera to
him, generally by service of summons.[10] In other words, until Cabrera was impleaded as reconvey the property would be an unlawful intrusion into the lawful exercise of his
party respondent and ordered to file a comment in the August 12, 1991, resolution, the proprietary rights over the land in question, an act which would constitute an actual denial
Court never obtained jurisdiction over him, and to command his principal to reconvey a of property without due process of law.
piece of property which used to be HIS would not only be inappropriate but would also
It may be true that the subject lot could have fetched a higher price during the public
constitute a real deprivation of ones property without due process of law.
auction, as Legarda claims, but the fail to betray any hint of a bid higher than Cabreras
Assuming arguendo that reconveyance is possible, that Cathay and Cabrera are one which was bypassed in his favor. Certainly, he could not help it if his bid of
and the same and that Cabreras payment redounded to the benefit of his principal, only P376,500.00 was the highest. Moreover, in spite of this allegedly low selling price,
reconveyance, under the facts and evidence obtaining in this case, would still not address Legarda still failed to redeem her property within the one-year redemption period. She
the issues raised herein could not feign ignorance of said sale on account of her counsels failure to so inform her,
because such auction sales comply with requirements of notice and publication under the
The application of the sale price to Legardas judgment debt constituted a payment Rules of Court. In the absence of any clear and convincing proof that such requirements
which extinguished her liability to Cathay as the party in whose favor the obligation to pay were not followed, the presumption of regularity stands. Legarda also claims that she was
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
in the United States during the redemption period, but she admits that she left the lease agreement was resolved. Consequently, the right of Cathay to be vindicated for such
Philippines only on July 13, 1985, or sixteen days after the auction sale of June 27, breach and the liability incurred by Legarda in the process were determined.
1985. Finally, she admits that her mother Ligaya represented her during her absence. [14] In
short, she was not totally in the dark as to the fate of her property and she could have This judgment became final when she failed to avail of remedies available to her,
exercised her right of redemption if she chose to, but she did not. such as filing a motion for reconsideration or appealing the case. At the time, the issues
raised in the complaint had already been determined and disposed of by the trial
Neither Cathay nor Cabrera should be made to suffer for the gross negligence of court.[19] This is the stage of finality which judgments must at one point or another reach. In
Legardas counsel. If she may be said to be innocent because she was ignorant of the acts our jurisdiction, a judgment becomes ipso facto final when no appeal is perfected or the
of negligence of her counsel, with more reason are respondents truly innocent. As reglementary period to appeal therefrom expires. The necessity of giving finality to
between two parties who may lose due to the negligence or incompetence of the counsel judgments that are not void is self-evident. The interests of society impose it. The opposite
of one, the party who was responsible for making it happen should suffer the view might make litigations more unendurable than the wrongs (they are) intended to
consequences. This reflects the basic common law maxim, so succinctly stated by Justice redress. It would create doubt, real or imaginary, and controversy would constantly arise
J.B.L. Reyes, that . . . (B)etween two innocent parties, the one who made it possible for the as to what the judgment or order was. Public policy and sound practice demand that, at the
wrong to be done should be the one to bear the resulting loss. [15] In this case, it was not risk of occasional errors, judgments of courts should become final at some definite date
respondents, Legarda, who misjudged and hired the services of the lawyer who practically fixed by law. The very object for which courts were instituted was to put an end to
abandoned her case and who continued to retain him even after his proven apathy and controversies.[20] When judgments of lower courts gain finality, they, too, become
negligence. inviolable, impervious to modification. They may, then, no longer be reviewed, or in any
way modified directly or indirectly, by a higher court, not even by the Supreme Court. [21] In
The Gancayco decision makes much of the fact that Legarda is now consigned to other words, once a judgment becomes final, the only errors that may be corrected are
penury and, therefore, this Court must come to the aid of the distraught client. It must be those which are clerical.[22]
remembered that this Court renders decisions, not on the basis of emotions but on its
sound judgment, applying the relevant, appropriate law. Much as it may pity Legarda, or From the foregoing precedents, it is readily apparent that the real issue that must be
any losing litigant for that matter, it cannot play the role of a knight in shining armor coming resolved in this motion for reconsideration is the alleged illegality of the final judgments of
to the aid of someone, who through her weakness, ignorance or misjudgment may have the trial and appellate courts.
been bested in a legal joust which complied with all the rules of legal proceedings.
Void judgments may be classified into two groups: those rendered by a court without
In Vales v. Villa,[16] this Court warned against the danger of jumping to the aid of a jurisdiction to do so and those obtained by fraud or collusion. [23] This case must be tested
litigant who commits serious error of judgment resulting in his own loss: in light of the guidelines governing the latter class of judgments. In this regard, an action to
annul a judgment on the ground of fraud will not lie unless the fraud is extrinsic or collateral
x x x Courts operate not because one person has been defeated or overcome by another, and facts upon which it is based (have) not been controverted or resolved in the case
but because he has been defeated or overcome illegally. Men may do foolish things, make where (the) judgment was rendered.[24]Where is the fraud in the case at bar? Was Legarda
ridiculous contracts, use miserable judgment, and lose money by them - indeed, all they unlawfully barred from the proceedings below? Did her counsel sell her out to the
have in the world; but not for that alone can the law intervene and restore. There must be, opponent?
in addition, a violation of law, the commission of what the law knows as an actionable It must be noted that, aside from the fact that no extrinsic fraud attended the trial and
wrong, before the courts are authorized to lay hold of the situation and remedy it." resolution of this case, the jurisdiction of the court a quo over the parties and the subject
matter was never raised as an issue by Legarda. Such being the case, the decision of the
Respondents should not be penalized for Legardas mistake. If the subject property trial court cannot be nullified. Errors of judgment, if any, can only be reviewed on appeal,
was at all sold, it was only after the decisions of the trial and appellate courts had gained failing which the decision becomes final and executory, valid and binding upon the parties
finality. These twin judgments, which were nullified by the Gancayco decision, should be in the case and their successors in interest. [25]
respected and allowed to stand by this Court for having become final and executory.
At this juncture, it must be pointed out that while Legarda went to the Court of
A judgment may be broadly defined as the decision or sentence of the law given by a Appeals claiming precisely that the trial courts decision was fraudulently obtained, she
court or other tribunal as the result of proceedings instituted therein. [17] It is a judicial act grounded her petition before the Supreme Court upon her estranged counsels
which settles the issues, fixes the rights and liabilities of the parties, and determines the negligence. This could only imply that at the time she filed her petition for annulment of
proceeding, and it is regarded as the sentence of the law pronounced by the court on the judgment, she entertained no notion that Atty. Coronel was being remiss in his duties. It
action or question before it.[18] was only after the appellate courts decision had become final and executory, a writ of
execution issued, the property auctioned off then sold to an innocent purchasers for value,
In the case at bar, the trial courts judgment was based on Cathays evidence after that she began to protest the alleged negligence of her attorney. In most cases, this would
Legarda was declared in default. Damages were duly awarded to Cathay, not whimsically, have been dismissed outright for being dilatory and appearing as an act of desperation on
but upon proof of its entitlement thereto. The issue of whether the plaintiff (Cathay) the part of a vanquished litigant. The Gancayco ruling, unfortunately, ruled otherwise.
deserved to recover damages because of the defendants (Legardas) refusal to honor their
Fortunately, we now have an opportunity to rectify a grave error of the past.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
WHEREFORE, the Motion for Reconsideration of respondent New Cathay House, on certiorari,4 seeking to reverse the portion of the CA Decision declaring Cagayan Capital
Inc. is hereby GRANTED. Consequently, the decision dated March 18, 1991, of the Courts College (the College) as a buyer in good faith. The other petition, G.R. Nos. 194314-15, is
First Division is VACATED and SET ASIDE. A new judgment is hereby entered one for certiorari5 filed by Dante D. Nacalaban, Helen N. Maandig, and Susan N. Siao as
DISMISSING the instant petition for review and AFFIRMING the November 29, 1989, heirs of Baldomera D. Vda. De Nacalaban (Nacalaban, et al.). It seeks to annul the CA
decision of the Court of Appeals in CA-G.R. No. SP-10487. Costs against petitioner Decision and Resolution which sustained the action for reconveyance filed by Gabutan, et
Victoria Legarda. al.
SO ORDERED.
The Antecedents
Before us are consolidated petitions questioning the Court of Appeals' (CA) In its Answer with Affirmative Defenses,26 the College claimed that it is a buyer in good
Decision1 dated December 11, 2008 and Resolution2 dated August 17, 2010 in CA-G.R. faith and for value, having "made exhaustive investigations and verifications from all
CV No. 68960-MIN and CA-G.R. SP No. 53598-MIN.3 In G.R. Nos. 185857-58, the heirs of reliable sources" that Melecia and her heirs were staying in the property by mere
Trifonia D. Gabutan and Tirso Dalondonan, Buna D. Actub, Felisia Trocio and Crisanta D. tolerance.27 It alleged that: (1) in the tax declaration28 of the residential house, Melecia
Ubaub (Gabutan, et al.) filed a partial appeal by way of a petition for review admitted that the lot owner is Godofredo;29 (2) the occupancy permit of Melecia was issued
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
only after Godofredo issued a certification30 to the effect that Melecia was allowed to WHEREFORE, judgment is hereby rendered, and this Court hereby:
occupy a portion of the property;31 and (3) the Extrajudicial Settlement with Sale was
published in three consecutive issues of Mindanao Post, a newspaper of general 1. Declares that the Spouses Godofredo and Baldomera Nacalaban held the land
circulation.32chanrobleslaw
covered by Transfer Certificate of Title No. T-2259 issued in the name of
Godofredo Nacalaban married to Baldomera Dalondonan issued on January 13,
In their Answer with Counterclaim,33 Nacalaban, et al. denied the allegations of 1959 in trust for Melecia Vda. de Dalondonan with the Spouses as the trustees
Gabutan, et al. They claimed to have acquired the property by intestate succession from and Melecia Vda. de Dalondonan as the cestui que trust;
their parents, who in their lifetime, exercised unequivocal and absolute ownership over the
property.34 Nacalaban, et al. also set up the defenses of laches and prescription, and
asserted that the action for reconveyance was improper because the property had already 2. Declares that upon the death of Melecia Vda. de Dalondonan on August 20,
been sold to an innocent purchaser for value. 35chanrobleslaw 1997, the ownership and beneficial interest of the foregoing Land passed to the
plaintiffs and individual defendants by operation of law as legal heirs of Melecia
On September 10, 1997, the College filed a separate Complaint for Unlawful Detainer and Vda. de Dalondonan;
Damages36with the Municipal Trial Court in Cities (MTCC) against Trifonia, Mary Jane,
Allan, Evelyn and Nicolas Dailo (Heirs of Melecia). In their Answer with Affirmative and/or 3. Nullifies the Extrajudicial Settlement of Estate of Deceased Person with Sale
Negative Defenses with Compulsory Counterclaim, 37 the Heirs of Melecia claimed that executed by the individual defendants on July 30, 1996 and known as Doc. No.
they own and possess the property in co-ownership with Nacalaban, et al. and Gabutan, et 326; Page No. 67; Book No. XX; Series of 1996 in the Notarial Register of Notary
al. because it was purchased by Melecia, their common predecessor. 38 They also claimed Public Victoriano M. Jacot with respect to the Extrajudicial settlement by the
that the house in which they reside was constructed at her expense.39 The College had individual defendants of the land referred to above;
prior knowledge of this co-ownership, and hence, was a purchaser in bad faith.40 The Heirs
of Melecia also raised the defense of forum-shopping in view of the pendency of the action 4. Declares that defendant Cagayan Capitol College was a buyer in good faith and
for reconveyance.41 They then concluded that in view of the issues and the value of the for value of the land referred to above, and, accordingly, declares that said
property, as well, the MTCC had no jurisdiction over the case. 42chanrobleslaw defendant now owns the land;
The MTCC found it had jurisdiction to hear the case and ruled in favor of the 5. Orders defendant Cagayan Capitol College to inform this Court in writing within
College:43chanrobleslaw thirty (30) days from receipt of this decision the amount of the purchase price of
the land referred to above bought by it from the individual defendants the amount
WHEREFORE, JUDGMENT is hereby rendered ordering each of the defendants to: of which should approximate the prevailing market value of the land at the time of
the purchase;
chanRoblesvirtualLawlibrarya.) Immediately vacate the property of the plaintiff;
b.) Pay the plaintiff the monthly use compensation for the continued use of the property at 6. Orders the individual defendants namely, Dante D. Nacalaban, Helen N.
the rate of P500.00 per month from MAY 5, 1997 until the property is actually vacated; Maandig, and Susan N. Siao, jointly and severally, to deliver and turn over to the
c.) Pay the plaintiff Attorney's fees amounting to P5,000.00 per defendant; plaintiffs, within thirty (30) days from receipt of this decision, plaintiffs' shares of
d.) Pay for litigation expenses at the rate of P1,000.00 per defendant. the proceeds of the sale of the land referred to above the amount of which is
equivalent to live-sixth (5/6) of said proceeds with the remaining one-sixth (1/6) to
SO ORDERED.44chanroblesvirtuallawlibrary be retained by the individual defendants as their share by virtue of their being the
On appeal, the Regional Trial Court (RTC) affirmed the MTCC's Decision46 in all respects, legal heirs of Baldomera D. Nacalaban;
except that the Heirs of Melecia were given 30 days from notice to vacate the
property.47 They filed a motion for reconsideration, but it was denied. 49 Thus, the Heirs of
Melecia filed a petition for review50 before the CA, docketed as CA-G.R. SP No. SO ORDERED.55chanroblesvirtuallawlibrary
53598.51chanrobleslaw
Both parties filed separate appeals from this Decision before the CA. 57 In a
Meanwhile, in the reconveyance case, the RTC rendered a Decision in favor of 52 Resolution58 dated October 7, 2004, the CA consolidated both appeals.
Gabutan, et al. The RTC found the testimonies of their witnesses credible, in that the
money of Melecia was used in buying the property but the name of Godofredo was used The C A rendered its Decision59 on December 11, 2008 dismissing the consolidated
when the title was obtained because Godofredo lived in Cagayan de Oro City while appeals and affirming in toto the RTC Decisions in the unlawful detainer case and the
Melecia lived in Bornay, Gitagum, Misamis Oriental. 53Thus, the RTC held that a trust was action for reconveyance. The CA held that: (1) the defense of co-ownership based on an
established by operation of law pursuant to Article 1448 of the Civil Code. 54 The dispositive implied trust by a defendant in an unlawful detainer case shall not divest the MTCC of
portion of the RTC's Decision reads: jurisdiction over the case;60 (2) the dead man's statute does not apply because Gabutan, et
al.'s counsel did not interpose any objection when the testimony of Crisanta Ubaub was
chanRoblesvirtualLawlibrary offered and Gabutan, et al.'s counsel even examined her;61 (3) Nacalaban, et al.'s claim
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
that Gabutan, et al.'s witnesses are not competent to testify on matters which took place remedy
before the death of Godofredo and Melecia is without merit because Gabutan, et al. have
not specified these witnesses and such hearsay evidence alluded to; 62 (4) the parole Pursuant to Section 1, Rule 45 of the Rules of Court, 78 the proper remedy to obtain a
evidence rule does not apply because Melecia and Nacalaban, et al. were not parties to reversal of judgment on the merits, final order or resolution is an appeal. The Resolution
the Deed of Conditional Sale;63 (5) the action for reconveyance has not yet prescribed dated August 17, 2010 of the CA, which affirmed its Decision dated December 11, 2008,
because Gabutan, et al. are in possession of the property;64 and (6) the College is a buyer was a final resolution that disposed of the appeal by Nacalaban, et al. and left nothing
in good faith.65chanrobleslaw more to be done by the CA in respect to the said case. Thus, Nacalaban, et al. should
have filed an appeal in the form of a petition for review on certiorari and not a petition
Nacalaban, et al. filed their motion for reconsideration of the CA Decision, but it was for certiorari under Rule 65, which is a special civil action.
denied in a Resolution66 dated August 17, 2010. Hence, they filed the present petition
for certiorari67 under Rule 65, where they allege that: (1) the action for reconveyance Rule 65 is a limited form of review and is a remedy of last recourse. This extraordinary
already expired;68 (2) for an action for reconveyance to prosper, the property should not action lies only where there is no appeal nor plain, speedy and adequate remedy in the
have passed into the hands of another who bought the property in good faith and for ordinary course of law.79 In Malayang Manggagawa ng Stayfast Phils., Inc. v. National
value;69 and (3) the title of Godofredo under TCT No. T-2259 which was issued on January Labor Relations Comission,80 we held that appeal would still be the proper remedy from a
13, 1959 could not be attacked collaterally. 70chanrobleslaw judgment on the merits, final order or resolution even if the error ascribed to the court
rendering the judgment is its lack of jurisdiction over the subject matter, or the exercise of
On the other hand, Gabutan, et al. filed the present petition for review on certiorari 71 under power in excess thereof, or grave abuse of discretion in the findings of fact or of law set
Rule 45, seeking a partial appeal of the CA Decision. In their petition, Gabutan, et al. out in the decision, order or resolution. The existence and availability of the right of appeal
allege that the College is not a buyer in good faith because it did not buy the property from prohibits the resort to certiorari because one of the requirements for the latter remedy is
the registered owner.72 Since Godofredo was the registered owner of the property and not that there should be no appeal.81 We have always declared that a petition for certiorari is
Nacalaban, et al., the College should have exercised a higher degree of prudence in not a substitute for an appeal where the latter remedy is available but was lost through
establishing their capacity to sell it. 73 Further, despite knowing that other persons fault or negligence.82chanrobleslaw
possessed the property, the College did not inquire with Gabutan, et al. the nature of their
stay on the property.74 Under Section 1, paragraph 2, Rule 74 of the Rules of Court, the Here, Nacalaban, et al. received the assailed Resolution dated August 17, 2010 on
publication of the Extrajudicial Settlement with Sale was also without prejudice to claims of September 7, 2010.83 Under the Rules of Court, they had 15 days or until September 22,
other persons who had no notice or participation thereof. 75 Finally, Gabutan, et al. argue 2010 to file an appeal before us. Nacalaban, et al. allowed this period to lapse without
that they cannot be ejected from the property because there is no evidence to show that doing so and, instead, filed a petition for certiorari on November 5, 2010. 84 Being the
their stay was by mere tolerance, and that Melecia was a builder in good wrong remedy, the petition of Nacalaban, et al. is, therefore, dismissible. Although there
faith.76chanrobleslaw are exceptions85 to this general rule, none applies in this case.
Considering that the petitions assail the same CA Decision and involve the same parties, In spite of the consolidation we have ordered, we cannot treat the petition of Nacalaban, et
we issued a Resolution77 dated December 13, 2010 consolidating them. al. as one under Rule 45. We have the discretion to treat a Rule 65 petition for certiorari as
a Rule 45 petition for review on certiorari if (1) the petition is filed within the reglementary
The Issues period for filing a petition for review; (2) when errors of judgment are averred; and (3) when
there is sufficient reason to justify the relaxation of the rules. 86 The first and third requisites
are absent in this case. To reiterate, the petition was filed beyond the 15-day reglementary
The issues for resolution are: period of filing a petition for review on certiorari. As will be discussed, we also find no
compelling reason to relax the rules.
chanRoblesvirtualLawlibrary
II. The action for reconveyance
filed by Gabutan, et al.
1. Whether the petition for certiorari of Nacalaban, et al. shall prosper; is proper
2. Whether the action for reconveyance was proper; and
3. Whether the College is a buyer in good faith.
a. An implied resulting trust was
created between Melecia and
Godofredo
Our Ruling
I. The petition for certiorari of We stress at the outset that the question of existence of an implied trust is factual, hence,
Nacalaban, et al. is a wrong ordinarily outside the purview of Rule 45. 87 The resolution of factual issues is the function
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
of the lower courts whose findings, when aptly supported by evidence, bind us. This is provide the details of the sale, specifically with regard to how Godofredo could have been
especially true when the CA affirms the lower court's findings, as in this case. While we, able to afford the purchase price himself, which would have directly refuted the allegation
under established exceptional circumstances, had deviated from this rule, we do not find that Melecia's money was used in the purchase. As the RTC aptly observed, if Godofredo
this case to be under any of the exceptions.88 Even if we were to disregard these really bought the property with his own money, it was surprising that Baldomera did not
established doctrinal rules, we would still affirm the assailed CA rulings. transfer the title of the property to her name when Godofredo died in 1974. Baldomera did
not do so until her death in 1994 despite being pressed by her siblings to partition the
Article 1448 of the Civil Code provides in part that there is an implied trust when property is property. The RTC correctly deduced that this only meant that Baldomera acknowledged
sold, and the legal estate is granted to one party but the price is paid by another for the that the property belongs to Melecia. 103chanrobleslaw
purpose of having the beneficial interest of the property. The former is the trustee, while
the latter is the beneficiary. The trust created here, which is also referred to as a purchase Having established the creation of an implied resulting trust, the action for reconveyance
money resulting trust,89 occurs when there is (1) an actual payment of money, property or filed by Gabutan, et al., the heirs of Melecia in whose benefit the trust was created, is
services, or an equivalent, constituting valuable consideration; (2) and such consideration proper. An action for reconveyance is a legal and equitable remedy granted to the rightful
must be furnished by the alleged beneficiary of a resulting trust.90 These two elements are landowner, whose land was wrongfully or erroneously registered in the name of another, to
present here. compel the registered owner to transfer or reconvey the land to him. 104 It will not amount to
a collateral attack on the title, contrary to the allegation of Nacalaban, et al.105 We
Gabutan, et al., through the testimonies of Felisia, Crisanta, and Trifonia, established that explained in Hortiznela v. Tagufa:106chanrobleslaw
Melecia's money was used in buying the property, but its title was placed in Godofredo's
name. She purchased the property because Felisia wanted to build a pharmacy on it. 91 On x x x As a matter of fact, an action for reconveyance is a recognized remedy, an action in
one occasion in Melecia's house, and when the entire family was present, Melecia gave personam, available to a person whose property has been wrongfully registered under the
Godofredo the money to purchase the property. 92 Melecia entrusted the money to Torrens system in another's name. In an action for reconveyance, the decree is not sought
Godofredo because he was in Cagayan de Oro, and per Melecia's instruction, the deed of to be set aside. It does not seek to set aside the decree but, respecting it as
sale covering the property was placed in his name. 93 It was allegedly her practice to buy incontrovertible and no longer open to review, seeks to transfer or reconvey the land from
properties and place them in her children's name, but it was understood that she and her the registered owner to the rightful owner. Reconveyance is always available as long as
children co-own the properties.94chanrobleslaw the property has not passed to an innocent third person for value.
Melecia built a residential building on the property, where her daughter Crisanta and some There is no quibble that a certificate of title, like in the case at bench, can only be
of her grandchildren resided.95 Godofredo also thereafter built a house on the property. questioned through a direct proceeding. The MCTC and the CA, however, failed to take
Twice, he also mortgaged the property to secure loans. Melecia allowed him to do so into account that in a complaint for reconveyance, the decree of registration is respected
because she trusted him.96After Godofredo's death, and when Baldomera fell ill, there as incontrovertible and is not being questioned. What is being sought is the transfer of the
were family discussions to transfer the title in Melecia's name so Melecia's children can property wrongfully or erroneously registered in another's name to its rightful owner or to
divide it together with the rest of Melecia's properties. The plans, however, always fell the one with a better right. If the registration of the land is fraudulent, the person in whose
through.97chanrobleslaw name the land is registered holds it as a mere trustee, and the real owner is entitled to file
an action for reconveyance of the property.107chanroblesvirtuallawlibrary
Both the RTC and CA found credence on these pieces of testimonial evidence that an
implied resulting trust exists. Reliance on these testimonies will not violate the parol The fact that the property was already titled in Godofredo's name, and later transferred to
evidence rule, as Nacalaban, et al. once raised. In Tong v. Go Tiat Kun,98 we ruled that the College, is not a hindrance to an action for reconveyance based on an implied trust.
since an implied trust is neither dependent upon an express agreement nor required to be The title did not operate to vest ownership upon the property in favor of the College. As
evidenced by writing, Article 1457 of our Civil Code authorizes the admission of parol held in Naval v. Court of Appeals:108chanrobleslaw
evidence to prove their existence. What is crucial is the intention to create a trust. 99 We
cautioned, however, that the parol evidence that is required to establish the existence of
xxx Registration of a piece of land under the Torrens System does not create or vest title,
an implied trust necessarily has to be trustworthy and it cannot rest on loose, equivocal or
because it is not a mode of acquiring ownership. A certificate of title is merely an evidence
indefinite declarations.100 The testimonies of Felisia, Crisanta, and Trifonia satisfy these
of ownership or title over the particular property described therein. It cannot be used to
requirements. They are consistent and agree in all material points in reference to the
protect a usurper from the true owner; nor can it be used as a shield for the commission of
circumstances behind the arrangement between Melecia and Godofredo. We agree with
fraud; neither does it permit one to enrich himself at the expense of others. Its issuance in
the RTC when it said that this arrangement among family members is not unusual,
favor of a particular person does not foreclose the possibility that the real property may be
especially in the 1950s.101chanrobleslaw
co-owned with persons not named in the certificate, or that it may be held in trust for
another person by the registered owner.109
Nacalaban, et al., on the other hand, denied the arrangement between Melecia and
Godofredo, and maintained that it was really the latter who purchased the property from its
Moreover, the body of the Complaint filed by Gabutan, et al. shows that it is not only for the
original owners, as evidenced by their possession of the Deed of Conditional Sale and the
reconveyance of the property but also for the annulment of TCT No. T-111846 issued in
title being in Godofredo's name.102 It is telling, however, that Nacalaban, et al. failed to
the name of the College.110 Gabutan, et al. questioned the validity of the sale to the
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
College and claimed co-ownership over the property. Thus, we can rule on the validity of grounded on the following: (i) Gabutan, et al.'s claim was never annotated on Godofredo's
TCT No. T-111846 since the Complaint is a direct attack on the title of the College. title; (ii) the Extrajudicial Settlement with Sale was duly published and the College was able
to effect the transfer of the title in its name; (iii) Baldomera issued a certification in favor of
Melecia allowing her to occupy a portion of the lot; and (iv) the tax declaration showed that
b. The action for reconveyance is imprescriptible
because the plaintiffs are in possession of Melecia owned only the building on the land owned by Godofredo.119chanrobleslaw
the property
The RTC reiterated the rule that the buyer of a land registered under the Torrens System
may rely upon the face of the certificate of title and does not have to look beyond it. 120 The
An action for reconveyance based on an implied or a constructive trust prescribes 10 years CA, on the other hand, held that when taken together, these facts would reasonably
from the alleged fraudulent registration or date of issuance of the certificate of title over the constitute enough reason for the College or any buyer to conclude that the property is free
property. However, an action for reconveyance based on implied or constructive trust is from any adverse claim, thereby making any further investigation unnecessary. Absent any
imprescriptible if the plaintiff or the person enforcing the trust is in possession of the showing that the College knew of the actual arrangement between Godofredo and
property. In effect, the action for reconveyance is an action to quiet the property title, which Melecia, it must be deemed a buyer in good faith. 121chanrobleslaw
does not prescribe.111 The reason is that the one who is in actual possession of the land
claiming to be its owner may wait until his possession is disturbed or his title is attacked Gabutan, et al. alleged that the lower courts erred in ruling that the College is a buyer in
before taking steps to vindicate his right. His undisturbed possession gives him a good faith, raising the following: (1) Nacalaban, et al. are not the registered owners of the
continuing right to seek the aid of a court of equity to ascertain and determine the nature of property; Godofredo is the registered owner who died on January 7, 1974; 122 (2) not being
the adverse claim of a third party and its effect on his own title, which right can be claimed the registered owners, the College, as buyer, is expected to examine not only the
only by one who is in possession.112chanrobleslaw certificate of title but all factual circumstances necessary for him to determine if there are
any flaws in the title of the transferor, or in his capacity to transfer the property; 123 and (3)
The fact of actual possession of Gabutan, et al. of the property, during the lifetime of the College knew that other persons possessed the property so it should have first
Melecia and even after her death, is an undisputed and established fact. The College has established the capacity of the Nacalaban children to sell the property. 124chanrobleslaw
even filed an ejectment case against the Heirs of Melecia for this reason. 113 Thus, their
complaint for reconveyance is imprescriptible. It follows, with more reason, that Gabutan, Whether one is a buyer in good faith and whether due diligence and prudence were
et al. cannot be held guilty of laches as the said doctrine, which is one in equity, cannot be exercised are questions of fact.125 As we have already mentioned, only questions of law
set up to resist the enforcement of an imprescriptible legal right. 114chanrobleslaw may be raised in a petition for review on certiorari under Rule 45 of the Rules of Court. We
see an exception, however, to this general rule relative to the finding that the College is a
III.The property shall be reconveyed to the estate of Melecia buyer in good faith. We hold that the RTC's finding that the College is a buyer in good faith,
The Extrajudicial Settlement with Sale executed which finding was upheld by the CA, was based on an obvious misapprehension of facts
between Nacalaban, et al. and the College is void and was clearly not supported by law and jurisprudence.
Having established the creation of an implied resulting trust between Melecia and
Godofredo, the law thereby creates the obligation of the trustee to reconvey the property In Bautista v. Silva,126 we reiterated the requisites for one to be considered a purchaser in
and its title in favor of the true owner. 115 The true owner, Melecia, died in 1997 and was good faith:
succeeded by her children and grandchildren. The property, therefore, must be
reconveyed to her estate. chanRoblesvirtualLawlibrary
A buyer for value in good Faith is one who buys property of another, without notice that
The execution of the Extrajudicial Settlement with Sale between Godofredo's heirs and the some other person has a right to, or interest in, such property and pays full and fair price
College will not defeat the legal obligation to reconvey the property because at the time of for the same, at the time of such purchase, or before he has notice of the claim or interest
its execution in 1996, Melecia was still alive. Hence, Nacalaban, et al. did not have the of some other persons in the property. He buys the property with the welt-founded belief
right or authority to sell the property. Nemo dat quod non habet. One can sell only what that the person from whom he receives the thing had title to the property and capacity to
one owns or is authorized to sell, and the buyer can acquire no more right than what the convey it.
seller can transfer legally.116 Nacalaban, et al. cannot find refuge in their argument that the
property was registered in their father's name and that after his death, his rights passed to To prove good faith, a buyer of registered and titled land need only show that he relied on
them as his legal heirs. To repeat, title to property does not vest ownership but is a mere the face of the title to the property. He need not prove that he made further inquiry for he is
proof that such property has been registered. 117chanrobleslaw not obliged to explore beyond the four corners of the title. Such degree of proof of good
faith, however, is sufficient only when the following
The College is a buyer in bad faith conditions concur: first, the seller is the registered owner of the land; second, the
latter is in possession thereof; and third, at the time of the sale, the buyer was not
Despite the finding that the property was owned by Melecia and upon her death, by her aware of any claim or interest of some other person in the property, or of any defect
heirs, the lower courts still sustained the ownership of the College of the property on the or restriction in the title of the seller or in his capacity to convey title to the property.
ground that it is an innocent purchaser for value. 118 The lower courts' findings are
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Absent one or two of the foregoing conditions, then the law itself puts the buyer on notice
and obliges the latter to exercise a higher degree of diligence by scrutinizing the certificate Although the College in its Answer alleged that it made an exhaustive investigation and
of title and examining all factual circumstances in order to determine the seller's title and verification from all reliable sources and found that the possession of Melecia and her heirs
capacity to transfer any interest in the property. Under such circumstance, it is no longer was merely tolerated,135 it failed to specify who or what these sources were. There is no
sufficient for said buyer to merely show that he relied on the face of the title; he must now evidence that the College did inquire from Melecia or her heirs themselves, who were
also show that he exercised reasonable precaution by inquiring beyond the title. Failure to occupying the property, the nature and authority of their possession. It is not far-fetched to
exercise such degree of precaution makes him a buyer in bad faith.127 (Emphasis conclude, therefore, that the College merely relied on the representations of the sellers
supplied.) and the documents they presented. In this regard, the College is not a buyer in good faith.
Thus, the College, which has the burden to prove the status of being a purchaser in good The "honesty of intention" which constitutes good faith implies a freedom from
faith, is required to prove the concurrence of the above conditions. This onus knowledge of circumstances which ought to put a person on inquiry.136 If the land
probandi cannot be discharged by mere invocation of the legal presumption of good purchased is in the possession of a person other than the vendor, the purchaser must be
faith.128 We find that the College failed to discharge this burden. wary and must investigate the rights of the actual possessor. 137 Without such inquiry, the
purchaser cannot be said to be in good faith and cannot have any right over the
Firstly, as correctly pointed out by Gabutan, et al., Nacalaban, et al. are not the registered property.138chanrobleslaw
owners of the property, but Godofredo. In Bautista v. Court of Appeals,129 we held:
We are aware that in the ejectment case, the MTCC and RTC ruled in favor of the College.
chanRoblesvirtualLawlibrary We emphasize, though, that the ruling on the College's better right of possession was
However, it is important to note that petitioners did not buy the land from the registered without prejudice to the eventual outcome of the reconveyance case where the issue of
owner, Dionisio Santiago. They bought it from his heirs, Maria dcla Cruz and Jose ownership was fully threshed out. We have held that the sole issue for resolution in an
Santiago. unlawful detainer case is physical or material possession of the property involved,
independent of any claim of ownership by any of the parties. When the defendant,
Where a purchaser buys from one who is not the registered owner himself, the law however, raises the defense of ownership in his pleadings and the question of possession
requires a higher degree of prudence even if the land object of the transaction is cannot be resolved without deciding the issue of ownership, the issue of ownership shall
registered. One who buys from one who is not the registered owner is expected to be resolved only to determine the issue of possession. 139 Thus, the ruling on the ejectment
examine not only the certificate of title but all factual circumstances necessary for him to case is not conclusive as to the issue of ownership. 140chanrobleslaw
determine if there are any flaws in the title of the transferor, or in his capacity to transfer
the land.130 WHEREFORE, in view of the foregoing, the petition for certiorari in G.R. Nos. 194314-14
is DENIED and the petition for review on certiorari in G.R. Nos. 185857-58 is GRANTED.
Secondly, the College was aware that aside from Nacalaban, et al., the Heirs of Melecia, The Decision of the Court of Appeals dated December 11, 2008 and its Resolution dated
were also in possession of the property. The College cited the tax declaration which bore August 17, 2010 are AFFIRMED with the following MODIFICATIONS:
an annotation that Melecia owned a residential building and Godofredo owned the
lot.131 Also, apart from filing an ejectment case against the Heirs of Melecia, the College
1. Cagayan Capitol College is hereby declared a buyer in bad faith, who has no
retained part of the purchase price for the demolition of Melecia's building as right to possession and ownership of the property;
well.132chanrobleslaw
In Occea v. Esponilla,133 we held that petitioner-spouses were not purchasers in good 2. Nacalaban, et al. are ordered to return the purchase price paid on the property to
faith when they merely relied on the representation of the seller regarding the nature of the College, plus interest at the rate of six percent (6%) per annum computed
possession of the occupants of the land: from July 23, 1997141 until the date of finality of this judgment. The total amount
shall thereafter earn interest at the rate of six percent (6%) per annum from the
chanRoblesvirtualLawlibrary finality of judgment until its satisfaction;142 and
In the case at bar, we find that petitioner-spouses failed to prove good faith in their
purchase and registration of the land, x x x At the trial, Tomas Occena admitted that he 3. The Register of Deeds is ordered to cancel TCT No. T-l 11846 in the name of the
found houses built on the land during its ocular inspection prior to his purchase. He relied College.
on the representation of vendor Arnold that these houses were owned by squatters
and that he was merely tolerating their presence on the land. Tomas should have 4. The property should be reconveyed to the Estate of the late Melecia Dalondonan
verified from the occupants of the land the nature and authority of their possession with the institution of the proper proceedings for its partition and titling.
instead of merely relying on the representation of the vendor that they were
squatters, having seen for himself that the land was occupied by persons other than
the vendor who was not in possession of the land at that time, x x x134 (Emphasis
SO ORDERED.
supplied.)
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
G.R. No. 195825 February 27, 2013 City. The RTC granted Sys petition on August 26, 1997. 7 The Registry of Deeds of
Quezon City then issued a new owners duplicate copy of TCT No. N-165606, which was
SPOUSES ALFONSO AND MARIA ANGELES CUSI, Petitioners, later cancelled by virtue of the deed of absolute sale dated July 14, 1997, and in its stead
the Registry of Deeds of Quezon City issued TCT No. 186142 in Sys name. 8
vs.
LILIA V. DOMINGO, Respondent.
Sy subsequently subdivided the property into two, and sold each half by way of contract to
x-----------------------x sell to Spouses Edgardo and Ramona Liza De Vera and to Spouses Alfonso and Maria
Angeles Cusi. The existence of the individual contracts to sell was annotated on the dorsal
portion of Sys TCT No. 186142 as Entry No. PE-8907/N-186142,9 stating that the
G.R. No. 195871 consideration of the sale was 1,000,000.00 for each set of buyers, or for a total of
2,000,000.00 for the entire property that had an actual worth of not less than
RAMONA LIZA L. DE VERA, Petitioner, 14,000,000.00. TCT No. 186142 in the name of Sy was then cancelled by virtue of the
vs deeds of sale executed between Sy and Spouses De Vera, and between Sy and Spouses
LILIA V. DOMINGO AND SPOUSES RADELIA AND ALFRED SY, Respondents. Cusi, to whom were respectively issued TCT No. 18956810 and TCT No. 189569.11 All the
while, the transactions between Sy and the De Veras, and between Sy and the Cusis were
unknown to Domingo, whose TCT No. N-165606 remained in her undisturbed
DECISION possession.12
BERSAMIN, J.: It turned out that the construction activities taking place on the property that Domingo
learned about were upon the initiative of the De Veras in the exercise of their dominical
Under the Torrens system of land registration, the registered owner of realty cannot be and possessory rights.
deprived of her property through fraud, unless a transferee acquires the property as an
innocent purchaser for value. A transferee who acquires the property covered by a Domingo commenced this action against Sy and her spouse, the De Veras and the Cusis
reissued owner's copy of the certificate of title without taking the ordinary precautions of in the RTC, the complaint being docketed as Civil Case No. Q-99-39312 and entitled Lilia
honest persons in doing business and examining the records of the proper Registry of V. Domingo v. Spouses Radelia and Alfred Sy, Spouses Alfonso G. and Maria Angeles S.
Deeds, or who fails to pay the full market value of the property is not considered an Cusi, Spouses Edgardo M. and Ramona Liza L. De Vera, BPI Family Savings Bank and
innocent purchaser for value. The Register of Deeds of Quezon City, seeking the annulment or cancellation of titles,
injunction and damages. Domingo applied for the issuance of a writ of preliminary
Under review in these consolidated appeals is the Decision promulgated on July 16, prohibitory and mandatory injunction, and a temporary restraining order (TRO). 13 The RTC
2010,1 whereby the Court of Appeals (CA) in CA-G.R. CV No. 90452 affirmed the revised granted Domingos application for the TRO enjoining the defendants from proceeding with
decision rendered on March 1, 2007 by the Regional Trial Court in Quezon City (RTC) the construction activities on the property. The RTC later granted her application for the
against the petitioners and their seller.2 writ of preliminary injunction.
The property in dispute was a vacant unfenced lot situated in White Plains, Quezon City On September 30, 2003, the RTC rendered a decision,14 disposing:
and covered by Transfer Certificate of Title (TCT) No. N-165606 issued in the name of
respondent Lilia V. Domingo by the Registry of Deeds of Quezon City. It had an area of WHEREFORE, in view of all the foregoing judgment is hereby rendered:
658 square meters.3 In July 1999, Domingo learned that construction activities were being
undertaken on her property without her consent. She soon unearthed the series of
anomalous transactions affecting her property. (a) declaring the sale between Lilia V. Domingo and Radella Sy void and of (sic)
effect;
On July 18, 1997, one Radelia Sy (Sy),4 representing herself as the owner of the property,
petitioned the RTC for the issuance of a new owners copy of Domingos TCT No. N- (b) declaring the Sps. Edgardo and Ramona Liza De Vera and Sps. Alfonso and
165606, appending to her petition a deed of absolute sale dated July 14, 1997 purportedly Maria Angeles Cusi to be purchasers in good faith and for value;
executed in her favor by Domingo;5 and an affidavit of loss dated July 17, 1997,6 whereby
she claimed that her bag containing the owners copy of TCT No. N-165606 had been (c) lifting the writ of preliminary injunction;
snatched from her on July 13, 1997 while she was at the SM City in North EDSA, Quezon
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
(d) finding defendant Radella Sy liable to the plaintiff Lilia Domingo liable (sic) for (f) Finding defendant Radelia Sy liable to the plaintiff Lilia V. Domingo liable (sic)
damages, as follows: for damages, as follows:
1. Fourteen Million Pesos (14,000,000.00) representing the value of 1. One Million Pesos (1,000,000.00) representing moral damages;
the property covered by TCT No. 165606 plus legal rate of interest until
fully paid;
2. Five Hundred Thousand Pesos (500,000.00) representing
exemplary damages;
2. One Million Pesos (1,000,000.00) representing moral damages;
3. Five Hundred Thousand Pesos (500,000.00) representing
3. Five Hundred Thousand Pesos (500,000.00) representing attorneys fees;
exemplary damages;
4. Two Hundred Thousand Pesos (200,000.00) representing litigation
4. Five Hundred Thousand Pesos (500,000.00) representing expenses; and,
attorneys fees;
5. Costs of suit.
5. Two Hundred Thousand Pesos (200,000.00) representing litigation
expenses; and
This Decision is without prejudice to whatever civil action for recovery and damages, the
defendants Sps. De Vera and Sps. Cusi may have against defendant Spouses Radelia
6. Costs of Suit. and Alfred Sy.
IT IS SO ORDERED. SO ORDERED.
Acting on the motions for reconsideration separately filed by Sy and Domingo, 15 the RTC Ruling of the CA
reconsidered and set aside its September 30, 2003 decision, and allowed the presentation
of rebuttal and sur-rebuttal evidence. On appeal, the assignment of errors each set of appellants made was as follows:
On March 1, 2007, the RTC rendered a new decision, 16 ruling: Spouses Cusi
WHEREFORE, in view of the foregoing, Judgment is hereby rendered: a) THE REGIONAL TRIAL COURT GRAVELY ERRED IN FINDING THAT
DEFENDANTS SPOUSES ALFONSO AND MARIA ANGELES CUSI ARE NOT
(a) Declaring the sale between Lilia Domingo and Radelia Sy void and of no PURCHASERS IN GOOD FAITH AND FOR VALUE.
effect;
b) THE REGIONAL TRIAL COURT GRAVELY ERRED IN FAILING TO
(b) Declaring the Sps. Edgardo and Ramona Liza De Vera and Sps. Alfonso and RESOLVE THE ISSUE OF WHETHER OR NOT CODEFENDANTS SPOUSES
Maria Angeles Cusi not purchasers in good faith and for value; RADELIA SY AND ALFRED SY ARE LIABLE FOR SPOUSES CUSIS CROSS-
CLAIM.
(c) TCT Nos. 189568 and 189569 are hereby cancelled and declared Null and
Void Ab Initio; c) THE REGIONAL TRIAL COURT ERRED IN FAILING TO AWARD DAMAGES
AND ATTORNEYS FEES TO DEFENDANTS SPOUSES CUSI. 17
(d) Directing the Register of Deeds of Quezon City to annotate this Order on TCT
No. 189568 and 189569; Spouses Sy
(e) TCT No. 165606 in the name of Lilia Domingo is hereby revalidated; and, a) THE TRIAL COURT A QUO ERRED IN HOLDING THAT THE SALE
BETWEEN LILIA DOMINGO AND RADELIA SY VOID AND OF NO EFFECT
AND WAS PROCURRED (sic) THROUGH FRAUDULENT MEANS.
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Land Titles and Deeds (Finals) 2017
b) THAT THE HONORABLE COURT ERRED IN AWARDING ACTUAL MORAL status of purchasers in good faith and for value by reason of their being aware of Sys TCT
DAMAGES, EXEMPLARY DAMAGES AND ATTORNEYS FEES AND No. 186142 being a reconstituted owners copy, thereby requiring them to conduct an
LITIGATION EXPENSES THE SAME BEING NULL AND VOID FOR BEING inquiry or investigation into the status of the title of Sy in the property, and not simply rely
CONTRARY TO LAW. on the face of Sys TCT No. 186142; and that the Cusis and De Veras were also aware of
other facts that should further put them on guard, particularly the several nearly
c) THAT THE SAID DECISION IS CONTRARY TO LAW AND simultaneous transactions respecting the property, and the undervaluation of the purchase
JURISPRUDENCE AND IS NOT SUPPORTED BY EVIDENCE, AS THE SAME price from 7,000,000.00/half to only 1,000,000.00/half to enable Sy to pay a lesser
CONTAIN SERIOUS REVERSIBLE ERRORS WHEN THE COURT A QUO capital gains tax.
DECLARED THAT TCT NOS. 189568 AND 189569 CANCELLED AND
DECLARED NULL AND VOID AB INITIO. The CA later on denied the motions for reconsideration. 21
II
As stated, the CA promulgated its decision on July 16, 2010, affirming the RTC with
modification of the damages to be paid by the Sys to Domingo, viz:
WHETHER OR NOT THE PETITIONERS ARE BUYERS IN GOOD FAITH AND
FOR VALUE.
WHEREFORE, premises considered, the instant appeal is denied. Accordingly, the
Decision dated March 1, 2007 of the Regional Trial Court is hereby AFFIRMED with the
modification on the award of damages to be paid by defendants-appellants Spouses III
Radelia and Alfred Sy in favor of the plaintiff-appellee Lilia V. Domingo, to wit;
GRANTING, WITHOUT ADMITTING, THAT THE DECISION OF THE
1. 500,000.00 by way of moral damages; HONORABLE COURT OF APPEALS IS CORRECT WITH RESPECT TO THE
SECOND ISSUE, WHETHER OR NOT PETITIONERS ARE ENTITLED TO
REIMBURSEMENT OF ALL THE PAYMENTS MADE BY PETITIONERS TO
2. 200,000.00 by way of exemplary damages; THEIR CODEFENDANTS SPOUSES ALFRED AND RADELIA SY IN ADDITION
TO DAMAGES AND ATTORNEYS FEES.
3. 100,000.00 as attorneys fees and litigation expenses.
In G.R. No. 195871, De Vera asserts that the primordial issue is whether or not she was
SO ORDERED.20 an innocent purchaser for value and in good faith.
The CA held that the sale of the property from Domingo to Sy was null and void and Ruling of the Court
conveyed no title to the latter for being effected by forging the signature of Domingo; that
Sy thereby acquired no right in the property that she could convey to the Cusis and De The petitions for review are bereft of merit.
Veras as her buyers; that although acknowledging that a purchaser could rely on what
appeared on the face of the certificate of title, the Cusis and De Veras did not have the
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Land Titles and Deeds (Finals) 2017
Firstly, now beyond dispute is the nullity of the transfer of Domingos property to Sy necessitates an analysis of evidence of a persons conduct. 29 That renders the
because both lower courts united in so finding. The unanimity in findings of both the RTC determination of intent as a factual issue, 30 something that the Court does not normally
and the CA on this all-important aspect of the case is now conclusive on the Court in view involve itself in because of its not being a trier of facts. Indeed, as a rule, the review
of their consistency thereon as well as by reason of such findings being fully supported by function of the Court is limited to a review of the law involved.
preponderant evidence. We consider to be significant that the Sys no longer came to the
Court for further review, thereby rendering the judgment of the CA on the issue of nullity But the Court now delves into the facts relating to the issue of innocence of the petitioners
final and immutable as to them. in their purchase of the property, considering that the RTC, through its original decision, at
first regarded them to have been innocent purchasers who were not aware of any flaw or
Secondly, the Cusis and De Vera commonly contend that the CA gravely erred in not defect in Sys title based on the fact that the property had been unfenced and vacant. The
considering them to be purchasers in good faith and for value. They argue that Sys TCT RTC also regarded the petitioners making of reasonable verifications as their exercise of
No. 186142 was free of any liens or encumbrances that could have excited their suspicion; the due diligence required of an ordinary buyer. 31 The RTC later completely turned around
and that they nonetheless even went beyond the task of examining the face of Sys TCT through another decision, however, and it was such decision that the CA affirmed subject
No. 186142, recounting every single detail of their quest to ascertain the validity of Sys to the modifications of the damages granted to Domingo.
title, but did not find anything by which to doubt her title.
There is no question that the petitioners exerted some effort as buyers to determine
The Court concurs with the finding by the CA that the Cusis and De Vera were not whether the property did rightfully belong to Sy. For one, they did not find any
purchasers for value and in good faith. The records simply do not support their common encumbrance, like a notice of lis pendens, being annotated on the TCT of Sy.
contention in that respect. Nonetheless, their observance of a certain degree of diligence within the context of the
principles underlying the Torrens system
Under the Torrens system of land registration,24 the State is required to maintain a register
of landholdings that guarantees indefeasible title to those included in the register. The was not their only barometer under the law and jurisprudence by which to gauge the
system has been instituted to combat the problems of uncertainty, complexity and cost validity of their acquisition of title. As the purchasers of the property, they also came under
associated with old title systems that depended upon proof of an unbroken chain of title the clear obligation to purchase the property not only in good faith but also for value.
back to a good root of title. The State issues an official certificate of title to attest to the fact
that the person named is the owner of the property described therein, subject to such liens
Therein lay the problem. The petitioners were shown to have been deficient in their
and encumbrances as thereon noted or what the law warrants or reserves. 25 vigilance as buyers of the property. It was not enough for them to show that the property
was unfenced and vacant; otherwise, it would be too easy for any registered owner to lose
One of the guiding tenets underlying the Torrens system is the curtain principle, in that one her property, including its possession, through illegal occupation. Nor was it safe for them
does not need to go behind the certificate of title because it contains all the information to simply rely on the face of Sys TCT No. 186142 in view of the fact that they were aware
about the title of its holder. This principle dispenses with the need of proving ownership by that her TCT was derived from a duplicate owners copy reissued by virtue of the loss of
long complicated documents kept by the registered owner, which may be necessary under the original duplicate owners copy. That circumstance should have already alerted them to
a private conveyancing system, and assures that all the necessary information regarding the need to inquire beyond the face of Sys TCT No. 186142. There were other
ownership is on the certificate of title. Consequently, the avowed objective of the Torrens circumstances, like the almost simultaneous transactions affecting the property within a
system is to obviate possible conflicts of title by giving the public the right to rely upon the short span of time, as well as the gross undervaluation of the property in the deeds of sale,
face of the Torrens certificate and, as a rule, to dispense with the necessity of inquiring ostensibly at the behest of Sy to minimize her liabilities for the capital gains tax, that also
further; on the part of the registered owner, the system gives him complete peace of mind excited suspicion, and required them to be extra-cautious in dealing with Sy on the
that he would be secured in his ownership as long as he has not voluntarily disposed of property.
any right over the covered land.26
To the Court, the CAs treatment of Sys TCT No. 186142 as similar to a reconstituted copy
The Philippines adopted the Torrens system through Act No. 496,27 also known as of a Torrens certificate of title was not unwarranted. In doing so, the CA cited the ruling
the Land Registration Act, which was approved on November 6, 1902 and took effect on in Barstowe Philippines Corporation v. Republic,32 where the Court, quoting from
February 1, 1903. In this jurisdiction, therefore, "a person dealing in registered land has the precedents, opined that "the nature of a reconstituted Transfer Certificate of Title of
right to rely on the Torrens certificate of title and to dispense with the need of inquiring registered land is similar to that of a second Owners Duplicate Transfer Certificate of
further, except when the party has actual knowledge of facts and circumstances that would Title," in that "both are issued, after the proper proceedings, on the representation of the
impel a reasonably cautious man to make such inquiry". 28 registered owner that the original of the said TCT or the original of the Owners Duplicate
TCT, respectively, was lost and could not be located or found despite diligent efforts
To obtain a grasp of whether a person has actual knowledge of facts and circumstances exerted for that purpose;"33 and that both were "subsequent copies of the originals
thereof," a fact that a "cursory examination of these subsequent copies would show" and
that would impel a reasonably cautious man to make such inquiry, an internal matter,
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Land Titles and Deeds (Finals) 2017
"put on notice of such fact [anyone dealing with such copies who is] thus warned to be the Registry of Deeds of Quezon City; that Sy filed the petition for the issuance of the
extracareful."34 duplicate owners copy of Domingos TCT No. 165606; that the RTC granted her petition
on August 26, 1997; and that on October 31, 1997, a real estate mortgage was executed
in favor of one Emma Turingan, with the mortgage being annotated on TCT No. 165606 on
Verily, the Court has treated a reissued duplicate owners copy of a TCT as merely a
reconstituted certificate of title. In Garcia v. Court of Appeals,35 a case with striking November 10, 1997.
similarities to this one, an impostor succeeded in tricking a court of law into granting his
petition for the issuance of a duplicate owners copy of the supposedly lost TCT. The Being the buyers of the registered realty, the Cusis and the De Veras were aware of the
impostor then had the TCT cancelled by presenting a purported deed of sale between him aforementioned several almost simultaneous transactions affecting the property. Their
and the registered owners, both of whom had already been dead for some time, and awareness, if it was not actual, was at least presumed, and ought to have put them on
another TCT was then issued in the impostors own name. This issuance in the impostors their guard, for, as the CA pointed out, the RTC observed that "[t]hese almost
own name was followed by the issuance of yet another TCT in favor of a third party, simultaneous transactions, particularly the date of the alleged loss of the TCT No. 165606
supposedly the buyer of the impostor. In turn, the impostors transferee (already the and the purported Deed of Sale, suffice[d] to arouse suspicion on [the part of] any person
registered owner in his own name) mortgaged the property to Spouses Miguel and Adela dealing with the subject property."37 Simple prudence would then have impelled them as
Lazaro, who then caused the annotation of the mortgage on the TCT. All the while, honest persons to make deeper inquiries to clear the suspiciousness haunting Sys title.
the original duplicate owners copy of the TCT remained in the hands of an heir of the But they still went on with their respective purchase of the property without making the
deceased registered owners with his co-heirs knowledge and consent. deeper inquiries. In that regard, they were not acting in good faith.
The inevitable litigation ensued, and ultimately ended up with the Court.1wphi1 The Another circumstance indicating that the Cusis and the De Veras were not innocent
Lazaros, as the mortgagees, claimed good faith, and urged the Court to find in their favor. purchasers for value was the gross undervaluation of the property in the deeds of sale at
But the Court rebuffed their urging, holding instead that they did not deal on the property in the measly price of 1,000,000.00 for each half when the true market value was then in
good faith because: (a) "the title of the property mortgaged to the Lazaros was a second the aggregate of at least 14,000,000.00 for the entire property. Even if the undervaluation
owners duplicate TCT, which is, in effect a reconstituted title. This circumstance should was to accommodate the request of Sy to enable her to minimize her liabilities for the
have alerted them to make the necessary investigation, but they did not;" and (b) their capital gains tax, their acquiescence to the fraud perpetrated against the Government, no
argument, that "because the TCT of the property on which their mortgage lien was less, still rendered them as parties to the wrongdoing. They were not any less guilty at all.
annotated did not contain the annotation: "Reconstituted title," the treatment of the In the ultimate analysis, their supposed passivity respecting the arrangement to perpetrate
reissued duplicate owners copy of the TCT as akin to a reconstituted title did not apply, the fraud was not even plausible, because they knew as the buyers that they were not
had no merit considering that: "The nature of a reconstituted Transfer Certificate of Title of personally liable for the capital gains taxes and thus had nothing to gain by their
registered land is similar to that of a second Owner's Duplicate Transfer Certificate of Title. acquiescence. There was simply no acceptable reason for them to have acquiesced to the
Both are issued, after the proper proceedings, on the representation of the registered fraud, or for them not to have rightfully insisted on the declaration of the full value of the
owner that the original of the said TCT or the original of the Owner's Duplicate TCT, realty in their deeds of sale. By letting their respective deeds of sale reflect the grossly
respectively, was lost and could not be located or found despite diligent efforts exerted for inadequate price, they should suffer the consequences, including the inference of their bad
that purpose. Both, therefore, are subsequent copies of the originals thereof. A cursory faith in transacting the sales in their favor.
examination of these subsequent copies would show that they are not the originals.
Anyone dealing with such copies are put on notice of such fact and thus warned to be
De Vera particularly insists that she and her late husband did not have any hand in the
extra-careful. This warning the mortgagees Lazaros did not heed, or they just ignored it." 36 undervaluation; and that Sy, having prepared the deed of sale, should alone be held
responsible for the undervaluation that had inured only to her benefit as the seller.
The fraud committed in Garcia paralleled the fraud committed here.1wphi1 The registered However, such insistence was rendered of no consequence herein by the fact that neither
owner of the property was Domingo, who remained in the custody of her TCT all along; the she nor her late husband had seen fit to rectify the undervaluation. It is notable that the De
impostor was Sy, who succeeded in obtaining a duplicate owners copy; and the Cusis and Veras were contracting parties who appeared to have transacted with full freedom from
the De Veras were similarly situated as the Spouses Lazaro, the mortgagees in Garcia. undue influence from Sy or anyone else.
The Cusis and the De Veras did not investigate beyond the face of Sys TCT No. 186142,
despite the certificate derived from the reissued duplicate owners copy being akin to a Although the petitioners argue that the actual consideration of the sale was nearly
reconstituted TCT. Thereby, they denied themselves the innocence and good faith they 7,000,000.00 for each half of the property, the Court rejects their argument as devoid of
supposedly clothed themselves with when they dealt with Sy on the property. factual basis, for they did not adduce evidence of the actual payment of that amount to Sy.
Accordingly, the recitals of the deeds of sale were controlling on the consideration of the
The records also show that the forged deed of sale from Domingo to Sy appeared to be sales.
executed on July 14, 1997; that the affidavit of loss by which Sy would later on support her
petition for the issuance of the duplicate owners copy of Domingos TCT No. 165606 was
executed on July 17, 1997, the very same day in which Sy registered the affidavit of loss in
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Good faith is the honest intention to abstain from taking unconscientious advantage of G.R. No. 192669 April 21, 2014
another. It means the "freedom from knowledge and circumstances which ought to put a
person on inquiry."38 RAUL SABERON, JOAN F. SABERON and JACQUELINE SABERON, Petitioners,
vs.
Given this notion of good faith, therefore, a purchaser in good faith is one who buys the OSCAR VENTANILLA, JR., and CARMEN GLORIA D. VENTANILLA, Respondents.
property of another without notice that some other person has a right to, or interest in, such
property and pays full and fair price for the same. 38 As an examination of the records RESOLUTION
shows, the petitioners were not innocent purchasers in good faith and for value. Their
failure to investigate Sy's title despite the nearly simultaneous transactions on the property
that ought to have put them on inquiry manifested their awareness of the flaw in Sy's title. MENDOZA, J.:
That they did not also appear to have paid the full price for their share of the property
evinced their not having paid true value. 39 For resolution of the Court is a motion for reconsideration of the Court's January 19, 2011
Resolution1 which denied the petition of Raul F. Saberon, Jr., Joan F. Saberon and
Resultantly, the Court affirms the lower courts, and restores to Domingo her rights of Jacqueline F. Saberon (Saberons). In effect, it affirmed the March 12, 2010 Decision 2 and
dominion over the propetiy. the June 18, 2010 Resolution3 of the Court of Appeals (CA) in CA-G.R. CV No. 85520,
holding that the June 21, 2005 Decision of the Regional Trial Court, Branch 80, Quezon
City (RTC) in Civil Case No. 96-26486, was correct in, among others, ordering the
WHEREFORE, the Court AFFIRMS the decision of the Court of Appeals promulgated on cancellation of Transfer Certificate of Title (TCT) Nos. 55396 and 55397 in the name of the
July 16, 201 0; and ORDERS the petitioners to pay the costs of suit.
Saberons and Samuel Marquez (Marquez).
SO ORDERED.
This case is an offshoot of two (2) cases involving the same property, docketed as G.R.
No. 82978 and G.R. No. 107282, which had been decided by the Court with finality on
November 22, 1990 and March 16, 1994, respectively.
Antecedent Facts
In the earlier cases, Manila Remnant Co., Inc. (MRCI) was the petitioner, being the owner
of several parcels of land situated in Quezon City, constituting the subdivision known as
Capitol Homes Subdivision Nos. I and II. On July 25, 1972, MRCI entered into a contract
with A.U. Valencia & Co. Inc. (AUVC) entitled "Confirmation of Land Development and
Sales Contract," whereby for a consideration, including sales commission and
management fee, the latter was to develop the aforesaid subdivision with authority to
manage the sales thereof; execute contracts to sell to lot buyers; and issue official
receipts. At that time, the president of AUVC, was Artemio U. Valencia (Valencia).
On March 3, 1970, MRCI and AUVC executed two (2) contracts to sell covering Lots 1 and
2 of Block 17, in favor of Oscar C. Ventanilla, Jr. and Carmen Gloria D. Ventanilla
(Ventanillas), for the combined contract price of 66,571.00 payable monthly for ten (10)
years. The Ventanillas paid the down payment as stipulated in the two (2) contracts.
On March 13, 1970, Valencia, holding out himself as president of MRCI, and without the
knowledge of the Ventanillas, resold the same property to Carlos Crisostomo
(Crisostomo), without any consideration. Valencia transmitted the fictitious contract with
Crisostomo to MRCI while he kept the contracts to sell with the Ventanillas in his private
office files. All the amounts paid by the latter were deposited in Valencias bank account
and remitted to MRCI as payments of Crisostomo. The Ventanillas continued to pay the
monthly installment.
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Land Titles and Deeds (Finals) 2017
Thereafter, MRCI terminated its business relationship with AUVC on account of MRCI then filed before this Court a petition for certiorari docketed as G.R. No. 82978, to
irregularities discovered in its collection and remittances. Consequently, Valencia was review the decision of the CA upholding the solidary liability of MRCI, AUVC and
removed as president by the Board of Directors of MRCI. He then stopped transmitting the Crisostomo for the payment of moral and exemplary damages and attorney's fees to the
Ventanillas monthly installments which at that time, already amounted to 17,925.40 for Ventanillas.
Lot 1 and 18,141.95 for Lot 2 (appearing in MRCIs records as credited under the name
of Crisostomo). On November 22, 1990, this Court affirmed the decision of the CA and declared the
judgment of the CFI Quezon City immediately executory.
On June 8, 1973, AUVC sued MRCI to impugn the abrogation of their agency agreement
before the Court of First Instance, Branch 19, Manila (CFI Manila), which eventually Encouraged by the seeming triumph of their cause, the Ventanillas moved for the issuance
ordered all lot buyers to deposit their monthly amortizations with the court. On July 17, of a writ of execution in Civil Case No. 26411. The writ was issued on May 3, 1991, and
1973, AUVC informed the Ventanillas that it was still authorized by the trial court to collect served upon MRCI on May 9, 1991. A notice of levy was annotated in the titles of MRCI on
the monthly amortizations and requested them to continue remitting their payment, with the May 31, 1991.
assurance that said payments would be deposited later in court.
In a manifestation and motion, however, MRCI alleged that the subject properties could not
For AUVCs failure to forward its collections to the trial court as ordered, MRCI caused the longer be delivered to the Ventanillas because they had already been sold to Samuel
publication of a notice cancelling the contracts to sell of some lot buyers including those of Marquez (Marquez) on February 7, 1990, while its petition was pending before this Court.
Crisostomo in whose name the payments of the Ventanillas had been credited. Nevertheless, MRCI offered to reimburse the amount paid by the Ventanillas, including
legal interest plus damages. MRCI also prayed that its tender of payment be accepted and
It was not until March 1978 when the Ventanillas discovered Valencias deception. that all garnishments on their accounts lifted.
Believing that they had already remitted the total amount of 73,122.35 for the two lots,
the Ventanillas offered to pay the balance to MRCI. To their shock, their names as lot The Ventanillas accepted the amount of 210,000.00 as damages and attorneys fees but
buyers did not appear in MRCIs records. Instead, MRCI showed them a copy of the rejected the reimbursement offered by MRCI in lieu of the execution of the absolute deed
contract to sell signed by Valencia, in favor of Crisostomo. MRCI refused the Ventanillas of sale. They contended that the alleged sale to Marquez was void, fraudulent, and in
offer to pay for the remainder of the contract price. contempt of court and that no claim of ownership over the properties in question had ever
been made by Marquez.
Aggrieved, the Ventanillas commenced an action for specific performance, annulment of
deeds and damages against MRCI, AUVC, and Crisostomo with the Court of First On July 19, 1991, the CFI Quezon City ordered that the garnishment made by the Sheriff
Instance, Branch 17-B, Quezon City (CFI Quezon City) docketed as Civil Case No. 26411, upon the bank account of MRCI could be lifted only upon the deposit to the Court of the
where Crisostomo was declared in default for his failure to file an answer. amount of 500,000.00 in cash.
On November 17, 1980, the CFI Quezon City rendered a decision declaring the contracts MRCI then moved for reconsideration praying that it be ordered to reimburse the
to sell in favor of the Ventanillas as valid and subsisting, and annulling the contract to sell Ventanillas in the amount of 263,074.10 and that the garnishment of its bank deposit be
in favor of Crisostomo. It ordered the MRCI to execute an absolute deed of sale in favor of lifted. This plea was denied twice by the trial court prompting MRCI to file another petition
the Ventanillas, free from all liens and encumbrances. Damages and attorney's fees in the for certiorari with the CA, which ruled that the contract to sell in favor of Marquez did not
total amount of 210,000.00 were also awarded to the Ventanillas for which the MRCI,
constitute a legal impediment to the immediate execution of the judgment. Furthermore, it
AUVC, and Crisostomo were held solidarily liable. The CFI Quezon City ruled further that if held that the cash bond fixed by the trial court for the lifting of the garnishment was fair and
for any reason the transfer of the lots could not be effected, MRCI, AUVC and Crisostomo
reasonable because the value of the lot in question had considerably increased.
would be solidarily liable to the Ventanillas for the reimbursement of the sum of
73,122.35, representing the amount they paid for the two (2) lots, and the legal interest
thereon from March 1970, plus the decreed damages and attorney's fees. Valencia was The 1994 Case
also held liable to MRCI for moral and exemplary damages and attorney's fees.
From the CA, the case was elevated to this Court as G.R. No. 107282 where MRCI argued
On separate appeals filed by AUVC and MRCI, the CA sustained the CFI Quezon Citys that the sale of the properties to Marquez was valid because at the time of the sale, the
decision in toto. issue of the validity of the sale to the Ventanillas had not yet been resolved. Further, there
was no specific injunction against it re-selling the property. As a buyer in good faith,
Marquez had a right to rely on the recitals in the certificate of title. The subject matter of
The 1990 Case the controversy having been passed to an innocent purchaser for value, the execution of
the absolute deed of sale in favor of the Ventanillas could not be ordered by the trial court.
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Land Titles and Deeds (Finals) 2017
The Ventanillas countered that the validity of the sale to them had already been eventually sold the same property to the Saberons, which conveyance was registered in
established even while the previous petition was still awaiting resolution. The petition only July 1992. ROD Cleofe opined that a judicial order for the cancellation of the titles in the
questioned the solidary liability of MRCI to the Ventanillas. Hence, the portion of the name of the Saberons was essential before he complied with the writ of execution in Civil
decision ordering MRCI to execute an absolute deed of sale in their favor had already Case No. 26411. Apparently, the notice of levy, through inadvertence, was not carried over
become final and executory when MRCI failed to appeal it to the Court. Thus, an order to the title issued to Marquez, the same being a junior encumbrance which was entered
enjoining MRCI from reselling the property in litigation was unnecessary. Besides, the after the contract to sell to Marquez had already been annotated.
unusual lack of interest, on the part of Marquez, to protect and assert his right over the
disputed property was, to the Ventanillas, a clear indication that the alleged sale to him Civil Case No. Q-96-26486
was merely a ploy of MRCI to evade the execution of the absolute deed of sale in their
favor.
Once again, the Ventanillas were constrained to go to court to seek the annulment of the
deed of sale executed between MRCI and Marquez as well as the deed of sale between
On March 16, 1994, the Court settled the controversy in this wise: Marquez and the Saberons, as the fruits of void conveyances. The case was docketed as
Civil Case No. Q-96-26486 with the Regional Trial Court, Branch 80, Quezon City (RTC).
The validity of the contract to sell in favor of the Ventanilla spouses is not disputed by the
parties. Even in the previous petition, the recognition of that contract was not assigned as During the trial, all the defendants, including Edgar Krohn Jr. (Krohn) as President of
error of either the trial court or appellate court. The fact that the MRCI did not question the MRCI, and Bede Tabalingcos (Tabalingcos) as its legal counsel, filed their respective
legality of the award for damages to the Ventanillas also shows that it even then already answers, except Marquez who was declared in default.
acknowledged the validity of the contract to sell in favor of the private respondents.
On June 21, 2005, the RTC rendered its decision, the dispositive portion of which reads:
On top of all this, there are other circumstances that cast suspicion on the validity, not to
say the very existence, of the contract with Marquez.
Wherefore, premises considered, judgment is hereby rendered in favour of plaintiffs, the
spouses Oscar and Carmen Ventanilla, and against defendants MRCI, Krohn,
First, the contract to sell in favor of Marquez was entered into after the lapse of almost ten Tabalingcos, Marquez and Saberon, as follows:
years from the rendition of the judgment of the trial court upholding the sale to the
Ventanillas.
(1) Declaring the Transfer Certificated of Title Nos. 55396 and 55397 in the name
of Samuel Marquez, and Transfer Certificates of Title Nos. 63140 and 63141 in
Second, the petitioner did not invoke the contract with Marquez during the hearing on the the names of Raul, Jr., Joan and Jacqueline Saberon as null and void;
motion for the issuance of the writ of execution filed by the private respondents. It
disclosed the contract only after the writ of execution had been served upon it.
(2) Ordering defendant MRCI to receive payment of the balance of the purchase
price to be paid by the plaintiffs and to execute a Deed of Absolute Sale in favour
Third, in its manifestation and motion dated December 21, 1990, the petitioner said it was of the plaintiffs, and in case of failure thereof, ordering plaintiffs to consign the
ready to deliver the titles to the Ventanillas provided that their counterclaims against
amount with this Court;
private respondents were paid or offset first. There was no mention of the contract to sell
with Marquez on February 7, 1990.
(3) Ordering the Register of Deeds to cancel the titles in the name of Marquez
and the Saberons, and to issue new certificates of title in the name of the
Fourth, Marquez has not intervened in any of these proceedings to assert and protect his
spouses Ventanillas upon registration of the Deed of Absolute Sale in favour of
rights to the subject property as an alleged purchaser in good faith. the plaintiffs or proof of their consignment;
At any rate, even if it be assumed that the contract to sell in favor of Marquez is valid, it (4) Ordering defendant MRCI, Krohn, Tabalingcos and Marquez to pay plaintiffs,
cannot prevail over the final and executory judgment ordering MRCI to execute an
jointly and severally, the sums of:
absolute deed of sale in favor of the Ventanillas. No less importantly, the records do not
show that Marquez has already paid the supposed balance amounting to 616,000.00 of
the original price of over 800,000.00. (Emphasis supplied) a. 100,000.00, as moral damages; and
As it turned out, the execution of the judgment in favor of the Ventanillas was yet far from b. 50,000.00, as attorneys fees.
fruition. Samuel Cleofe, Register of Deeds for Quezon City (ROD Cleofe) revealed to
them, that on March 11, 1992, MRCI registered a deed of absolute sale to Marquez who
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
(5) Ordering defendant MRCI, Krohn, Tabalingcos and Marquez to pay was considered as sufficient notice to all persons that the land was already subject to
defendants Saberon, jointly and severally, the sum of 7,118,155.88 attachment. Resultantly, attachment was duly perfected and bound the land.
representing the value of the properties in dispute and the value of the
improvements introduced by defendants Saberon; and
The Present Petition
stipulated on the contracts to sell, thus preventing the obligatory force of the contract from The question of utmost relevance to this case, then, is this: whether or not the registration
taking effect. of the notice of levy had produced constructive notice that would bind third persons despite
the failure of the ROD-QC to annotate the same in the certificates of title?
On October 4, 2010, the Court required the Ventanillas to file their comment to the
petition.6 On January 19, 2011, the Court resolved to deny the Saberons petition for failure In answering these questions, the Court is beckoned to rule on two conflicting rights over
to sufficiently show any reversible error in the assailed judgment by the CA. 7 In its June 15, the subject properties: the right of the Ventanillas to acquire the title to the registered land
2011 Resolution,8 the Court required the Ventanillas to comment on the motion for from the moment of inscription of the notice of levy on the day book (or entry book), on one
reconsideration filed by the Saberons. hand; and the right of the Saberons to rely on what appears on the certificate of title for
purposes of voluntary dealings with the same parcel of land, on the other.
Resolution of the Court
The Saberons maintain that they had no notice of any defect, irregularity or encumbrance
in the titles of the property they purchased. In its decision, however, the RTC pointed out
At first glance, it would seem that the case involves convoluted issues brought about by
the number of times the Ventanillas were impelled by circumstances to seek judicial action. that their suspicion should have been aroused by the circumstance that Marquez, who was
not engaged in the buy-and-sell business and had the property for only a few months,
Nonetheless, the antecedents would readily reveal that the essential facts are not
disputed: 1) that the subject properties have indeed been the objects of various transfers would offer the same for sale. Although the RTC found that the Saberons may not be
effected by MRCI leading to the current controversy between the Saberons and the considered as innocent purchasers for value because of this circumstance, it, nonetheless,
Ventanillas; and 2) that prior to the sale to the Saberons, a notice of levy as an ruled that they, who might well be unwilling victims of the fraudulent scheme employed by
encumbrance was already in existence. MRCI and Marquez, were entitled to actual and compensatory damages.
Sections 51 and 52 of P.D. No. 1529 explain the purpose and effects of registering both To this latter finding, the Court agrees. The Saberons could not be said to have authored
voluntary and involuntary instruments, to wit: the entanglement they found themselves in. No fault can be attributed to them for relying
on the face of the title presented by Marquez. This is bolstered by the fact that the RTC
decision shows no categorical finding that the Saberons purchase of the lots from
Section 51. Conveyance and other dealings by registered owner. An owner of registered Marquez was tainted with bad faith. That the Saberons should have harbored doubts
land may convey, mortgage, lease, charge or otherwise deal with the same in accordance against Marquez is too high a standard to impose on a buyer of titled land. This is in
with existing laws. He may use such forms of deeds, mortgages, leases or other voluntary consonance to the rule that the one who deals with property registered under the Torrens
instruments as are sufficient in law. But no deed, mortgage, lease, or other voluntary system is charged with notice only of such burdens and claims as are annotated on the
instrument, except a will purporting to convey or affect registered land shall take effect as a title.9 "All persons dealing with property covered by Torrens certificate of title are not
conveyance or bind the land, but shall operate only as a contract between the parties and required to explore further than what the Torrens title upon its face indicates in quest for
as evidence of authority to the Register of Deeds to make registration. any hidden defect or inchoate right that may subsequently defeat his right
thereto."10 These rules remain as essential features of the Torrens system. The present
The act of registration shall be the operative act to convey or affect the land insofar as third case does not entail a modification or overturning of these principles.
persons are concerned, and in all cases under this Decree, the registration shall be made
in the office of the Register of Deeds for the province or city where the land lies. Be that as it may, no fault can likewise be imputed to the Ventanillas.
Section 52. Constructive notice upon registration. Every conveyance, mortgage, lease, In ultimately ruling for the Ventanillas, the courts a quo focused on the superiority of their
lien, attachment, order, judgment, instrument or entry affecting registered land shall, if notice of levy and the constructive notice against the whole world which it had produced
registered, filed or entered in the office of the Register of Deeds for the province or city and which effectively bound third persons including the Saberons.
where the land to which it relates lies, be constructive notice to all persons from the time of
such registering, filing or entering.
It has already been established in the two previous cases decided by the Court that the
contracts to sell executed in favor of the Ventanillas are valid and subsisting. Clearly, it has
These provisions encapsulate the rule that documents, like the certificates of title do not been acknowledged, even by MRCI, as can be seen in the latters own choice to only
effect a conveyance of or encumbrances on a parcel of land. Registration is the operative question their solidary liability in the 1990 case and its failure to assign the same as an
act that conveys ownership or affects the land insofar as third persons are concerned. By error in the 1994 case. In the same vein, the issue on Marquezs title had already been
virtue of registration, a constructive notice to the whole world of such voluntary or passed upon and settled in the 1994 case. That he purchased the lots prior to the
involuntary instrument or court writ or processes, is thereby created. annotation of the notice of levy in MRCIs title was of no moment. In fact, the Court
explicitly declared that MRCIs transaction with Marquez "cannot prevail over the final and
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
executory judgment ordering MRCI to execute an absolute deed of sale in favor of the Additionally, Section 59 of P.D. No. 1529 provides that, "[i]f, at the time of the transfer,
Ventanillas." subsisting encumbrances or annotations appear in the registration book, they shall be
carried over and stated in the new certificate or certificates, except so far as they may be
simultaneously released or discharged." This provision undoubtedly speaks of the
These favorable findings prompted the Ventanillas to register the notice of levy on the
properties. The records show that on the strength of a final and executory decision by the ministerial duty on the part of the Register of Deeds to carry over existing encumbrances
Court, they successfully obtained a writ of execution from the RTC and a notice of levy to the certificates of title.
was then entered, albeit on the primary entry book only. The contract to sell to Marquez
was registered on May 21, 1991, while the notice of levy was issued ten (10) days later, or From the foregoing, ROD Cleofes theory that a deed of sale, as a mere conclusion of a
on May 31, 1991. In February 1992, MRCI executed the Deed of Sale with Marquez, under contract to sell, turns into a senior encumbrance which may surpass a notice of levy, has
whose name the clean titles, sans the notice of levy, were issued. A year later, or on no leg to stand on. It was, in fact, properly rejected by the courts a quo. Verily, the
March 11, 1992, MRCI registered the deed of sale to Marquez who later sold the same controversy at hand arose not from the Ventanillas fault, but from ROD Cleofes misplaced
property to the Saberons. understanding of his duty under the law.
This complex situation could have been avoided if it were not for the failure of ROD Cleofe Surely, the Ventanillas had every right to presume that the Register of Deeds would carry
to carry over the notice of levy to Marquezs title, serving as a senior encumbrance that over the notice of levy to subsequent titles covering the subject properties. The notice was
might have dissuaded the Saberons from purchasing the properties. registered precisely to bind the properties and to serve as caution to third persons who
might potentially deal with the property under the custody of the law. In DBP v. Acting
The Court agrees with the position of the RTC in rejecting ROD Cleofes theory. Register of Deeds of Nueva Ecija,16 the Court ruled that entry alone produced the effect of
registration, whether the transaction entered was a voluntary or involuntary one, so long as
the registrant had complied with all that was required of him for purposes of entry and
Distinctions between a contract to sell and a contract of sale are well-established in annotation, and nothing more remained to be done but a duty incumbent solely on the
urisprudence.1wphi1 In a contract of sale, the title to the property passes to the vendee Register of Deeds.
upon the delivery of the thing sold; in a contract to sell, ownership is, by agreement,
reserved in the vendor and is not to pass to the vendee until full payment of the purchase
price. Otherwise stated, in a contract of sale, the vendor loses ownership over the property While the Court is not unmindful that a buyer is charged with notice only of such burdens
and claims as are annotated on the title, the RTC and the CA are both correct in applying
and cannot recover it until and unless the contract is resolved or rescinded; whereas, in a
contract to sell, title is retained by the vendor until full payment of the price. In the latter the rule as to the effects of involuntary registration. In cases of voluntary registration of
documents, an innocent purchaser for value of registered land becomes the registered
contract, payment of the price is a positive suspensive condition, failure of which is not a
breach but an event that prevents the obligation of the vendor to convey title from owner, and, in contemplation of law the holder of a certificate of title, the moment he
presents and files a duly notarized and valid deed of sale and the same is entered in the
becoming effective.11
day book and at the same time he surrenders or presents the owner's duplicate certificate
of title covering the land sold and pays the registration fees, because what remains to be
It is undeniable, therefore, that no title was transferred to Marquez upon the annotation of done lies not within his power to perform. The Register of Deeds is duty bound to perform
the contract to sell on MRCIs title. As correctly found by the trial court, the contract to sell it.17 In cases of involuntary registration, an entry thereof in the day book is a sufficient
cannot be substituted by the Deed of Absolute Sale as a "mere conclusion" of the previous notice to all persons even if the owner's duplicate certificate of title is not presented to the
contract since the owners of the properties under the two instruments are different. 12 register of deeds. Therefore, in the registration of an attachment, levy upon execution,
notice of lis pendens, and the like, the entry thereof in the day book is a sufficient notice to
Considering that the deed of sale in favor of Marquez was of later registration, the notice of all persons of such adverse claim.18
levy should have been carried over to the title as a senior encumbrance.
This rule was reiterated in the more recent case of Armed Forces and Police Mutual
Corollary to this is the rule that a levy of a judgment debtor creates a lien, which nothing Benefit Association, Inc., v. Santiago,19 as relied upon by the CA. In AFP, the Notice of
can subsequently destroy except the very dissolution of the attachment of the levy Levy was presented for registration in the Registry of Deeds of Pasig City. The Notice was
itself.13 Prior registration of the lien creates a preference, since the act of registration is the entered in the Primary Entry Book, but was not annotated on the TCT because the original
operative act to convey and affect the land. 14 Jurisprudence dictates that the said lien copy of the said title on file in the Registry of Deeds was not available at that time. Six (6)
continues until the debt is paid, or the sale is had under an execution issued on the days after the presentation of the Notice of Levy, the Deed of Absolute Sale involving the
judgment or until the judgment is satisfied, or the attachment is discharged or vacated in same parcel of land was presented for registration and likewise entered. The deed of sale
the same manner provided by law. Under no law, not even P.D. No. 1529, is it stated that was examined by the same employee who examined the notice of levy, but she failed to
an attachment shall be discharged upon sale of the property other than under execution. 15 notice that the title subject of the sale was the same title which was the subject of the
notice of levy earlier presented. Unaware of the previous presentation of the notice of levy,
the Register of Deeds issued a certificate of title in the name of the vendee on the basis of
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
the deed of sale. The Register of Deeds in AFP immediately requested the vendee to the previous decisions discussed herein already sealed the validity of the contract to sell
surrender the documents in light of the mistake discovered so that he could take issued to the Ventanillas decades ago. As found by the RTC, it was MRCIs obstinate
appropriate rectification or correction. Settling the issue on whether the notice of levy could refusal to accept their tender of payment, not to mention the devious transfer of the
be annotated in the certificate of title, the Court ruled in the affirmative on the ground that property, which caused the decade-long delay of the execution of the deed of sale in their
the preference created by the levy on attachment was not diminished by the subsequent favor. This is a finding that the Court, which is not a trier of facts, will have to respect.
registration of the prior sale. Superiority and preference in rights were given to the
registration of the levy on attachment; although the notice of attachment had not been In the same vein, the attribution of laches against the Ventanillas is flawed. Their failure to
noted on the certificate of title, its notation in the book of entry of the Register of Deeds learn about the structures being built on the subject lands and the payment of real property
produced all the effects which the law gave to its registration or inscription, to wit: taxes by the Saberons is not sufficient justification to withhold the declaration of their
ownership over it. Against a different factual milieu, laches may be said to have set it but
Under the rule of notice, it is presumed that the purchaser has examined every not so in this case. While the Ventanillas may have been unaware that improvements were
instrument of record affecting the title. Such presumption is irrebuttable. He is charged with being erected over the lots, this obliviousness can, by no means, be treated as a lack of
notice of every fact shown by the record and is presumed to know every fact shown by the vigilance on their part. It bears stressing that the Ventanillas are now of advanced age and
record and to know every fact which an examination of the record would have disclosed. retired as university professors. Considering the length of litigation which they had to
This presumption cannot be overcome by proof of innocence or good faith. Otherwise, the endure in order to assert their right over the property which they have painstakingly paid
very purpose and object of the law requiring a record would be destroyed. Such for decades ago, to hold now that they have been remiss in the protection of their rights
presumption cannot be defeated by proof of want of knowledge of what the record contains would be the height of impropriety, if not injustice. To exact from them an obligation to visit
any more than one may be permitted to show that he was ignorant of the provisions of the the land in litigation every so often, lest they be held to have slept on their rights, is
law. The rule that all persons must take notice of the facts which the public record contains iniquitous and unreasonable. All told, the Ventanillas remain as innocent victims of
is a rule of law. The rule must be absolute; any variation would lead to endless confusion deception.
and useless litigation. For these reasons, a declaration from the court that respondent was
in bad faith is not necessary in order that the notice of levy on attachment may be The Court deems it significant to note that the amount of 7,118,115.88 awarded to the
annotated on TCT No. PT-94912. Saberons by the RTC is to be satisfied by MRCI, Krohn, Tabalingcos, and Marquez, who
have not been impleaded as parties to the present petition, thus, rendering the said award
The fact that the notice of levy on attachment was not annotated on the original title on file final and executory. The said amount, however, is separate and distinct from those
in the Registry of Deeds, which resulted in its non-annotation on the title TCT No. PT- provided under Article 44821 in relation to Article 54622 of the Civil Code. In the petition, the
94912, should not prejudice petitioner. As long as the requisites required by law in order to Saberons invoked the said provisions, claiming that they are entitled to reimbursement of
effect attachment are complied with and the appropriate fees duly paid, attachment is duly all the expenses incurred in the introduction of improvements on the subject lands
perfected. The attachment already binds the land. This is because what remains to be amounting to 23,058,822.79.
done lies not within the petitioners power to perform but is a duty incumbent solely on the
Register of Deeds. (Emphasis supplied) The Court finds the Saberons to be builders in good faith.
In the case at bench, the notice of levy covering the subject property was annotated in the No less than the court a quo observed that "no actual evidence that the Saberons
entry book of the ROD QC prior to the issuance of a TCT in the name of the Saberons. connived with the MRCI and Marquez to have the titles registered in their names to the
Clearly, the Ventanillas levy was placed on record prior to the sale. This shows the prejudice of the (Ventanillas)" and that what was obvious was that "the Saberons dealt with
superiority and preference in rights of the Ventanillas over the property as against the
clean certificates of titles." Also quite telling on this point is the finding that MRCI, Krohn,
Saberons. In AFP, the Court upheld the registration of the levy on attachment in the Tabalingcos, and Marquez are liable to the Saberons. The RTC reasoned out in the
primary entry book as a senior encumbrance despite the mistake of the ROD, the Court
following wise:
must, a fortiori, sustain the notice of levy registered by the Ventanillas notwithstanding the
nonfeasance of ROD Cleofe. Again, the prevailing rule is that there is effective registration
once the registrant has fulfilled all that is needed of him for purposes of entry and This Court is not convinced, however that defendants Saberon took part in the fraudulent
annotation, so that what is left to be accomplished lies solely on the Register of Deeds. 20 scheme employed by the other defendants against the plaintiffs. Although they may not be
considered as innocent purchasers for value shown in the discussion above, this Court is
not ready to conclude that the Saberons joined the other defendants in their efforts to
Suffice it to say, no bad faith can be ascribed to the parties alike. Nevertheless, the equal frustrate plaintiffs rights over the disputed properties. On the contrary, they may be
footing of the parties necessarily tilts in favor of the superiority of the Ventanillas notice of considered victims of the same fraudulent employed by defendants MRCI and Marquez,
levy, as discussed. and thus can rightfully claim damages from the same. 23
The Court also sees no reason to dwell in the contention that the rights or interests of the
Ventanillas in the subject properties never ripened into ownership. It bears stressing that
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Consequently, Article 448 in relation to Article 546 of the Civil Code will apply.1wphi1 The [G.R. No. 128354. April 26, 2005]
provisions respectively read:
Article 448. The owner of the land on which anything has been built, sow or planted in
good faith, shall have the right to appropriate, as his own the works, sowing, or planting, HOME BANKERS SAVINGS & TRUST CO., petitioner, vs. THE HONORABLE COURT
after payment of the indemnity provided for in Article 546 and 548, or to oblige the one who OF APPEALS, PABLO N. AREVALO, FRANCISCO A. UY, SPOUSES
built or planted to pay the price of the land, and the one who sowed, the proper rent. LEANDRO A. SORIANO, JR. and LILIAN SORIANO, ALFREDO LIM and
However, the builder or planter cannot be obliged to buy the land and if its value is FELISA CHI LIM/ALFREDO LIM, respondents.
considerably more than that of the building or trees. In such case, he shall pay reasonable
rent, if the owner of the land does not choose to appropriate the building or trees after
proper indemnity. The parties shall agree upon the terms of the lease and in case DECISION
disagreement, the court shall fix the terms thereof.
AUSTRIA-MARTINEZ, J.:
Article 546. Necessary expenses shall be refunded to every possessor; but only the
Before us is a petition for review on certiorari under Rule 45 of the Rules of Court
possessor in good faith may retain the thing until he has been reimbursed therefore.
seeking to annul the Decision[1] of the Court of Appeals (CA) dated November 28, 1996 in
CA-G.R. SP No. 40892 and its Resolution dated February 19, 1997 denying petitioners
Useful expenses shall be refunded only to the possessor in good faith with the same right motion for reconsideration.
of retention, the person who has defeated him in the possession having the option of
refunding the amount of the expenses or of paying the increase in value which the thing Each of private respondents entered into separate contracts to sell with
may have acquired by reason thereof. TransAmerican Sales and Exposition (TransAmerican) through the latters Owner/General
Manager, Engr. Jesus Garcia, involving certain portions of land covered by Transfer
Certificate of Title (TCT) No. 19155, located at No. 45 Gen. Lim Street, Heroes Hill,
Thus, the two options available to the Ventanillas: 1) they may exercise the right to Quezon City, together with one unit three-storey townhouse to be built on each portion, as
appropriate after payment of indemnity representing the value of the improvements follows:
introduced and the necessary and useful expenses defrayed on the subject lots; or 2) they
may forego payment of the said indemnity and instead, oblige the Saberons to pay the
price of the land. Respondent Pablo N. Arevalo purchased the portion of land denominated as Unit No.
5[2] for the amount of P750,000.00 on August 21, 1988 and had already fully paid the
purchase price on September 3, 1988;
Should the Ventanillas elect to appropriate the improvements, the trial court is ordered to
determine the value of the improvements and the necessary and useful expenses after
hearing and reception of evidence. Should the Ventanillas, however, pursue the option to Respondent Alfredo Lim purchased the portion of land denominated as Unit No. 1[3] for the
oblige the Saberons to pay the "price of the land," the trial court is ordered to determine amount of P800,000.00 on December 22, 1988 and fully paid the same upon execution of
said price to be paid to the V entanillas. the agreement on the same day;
WHEREFORE, the Motion for Reconsideration is PARTIALLY GRANTED. The appealed Respondent Francisco A. Uy purchased the portion of land denominated as Unit No. 6 [4] on
March 12, 2010 Decision and the June 18, 2010 Resolution of the Court of Appeals in CA- October 29, 1988 in the amount of P800,000.00 payable in installments and had allegedly
G.R. CV No. 85520 are AFFIRMED with modification in that the Ventanillas are given a made a total payment of P581,507.41. He ordered to stop the payment of all [postdated]
period of sixty ( 60) days from finality of this Resolution to decide whether to pay the checks from September 1990 to November 1995 on the ground of non-completion of his
Saberons the value of the improvements and the necessary and useful expenses defrayed unit and had later learned of the foreclosure of the property;
on the 2 lots or to oblige the Saberons to pay them the "price" of said lots. Depending on
the option exercised by the Ventanillas, the case is hereby remanded to the court of origin Respondent spouses Leandro A. Soriano, Jr. and Lilian Soriano purchased the portion of
for further proceedings as to the determination of reimbursement due to the petitioners or land denominated as Unit No. 3[5] on February 15, 1990 in the amount of P1,600,000.00
of the "price" of the subject lots due to the Ventanillas. and had allegedly made a payment of P669,960.00. They had stopped paying because of
non-completion of the project and had later learned of the foreclosure of the property;
SO ORDERED.
Respondents Alfredo Lim and Santos Lim purchased the portion of land denominated as
Unit No. 7[6] for P700,000.00 on October 1988 and had been fully paid as of March 18,
1989; Santos Lim subsequently sold and assigned his share of the property to private
respondent Felisa Chi Lim on May 12, 1989.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
It is stipulated in their respective contracts that their individual townhouses will be fully 1. Declaring the mortgage executed by and between respondents Engr. Jesus
completed and constructed as per plans and specifications and the respective titles thereto Garcia/TransAmerican Sales and Exposition and Home Bankers Savings and Trust
shall be delivered and transferred to private respondents free from all liens and Company (formerly Home Savings Bank and Trust Company) to be unenforceable as
encumbrances upon their full payment of the purchase price. However, despite repeated against all the complainants;
demands, Garcia/TransAmerican failed to comply with their undertakings.
On May 30, 1989, Engr. Garcia and his wife Lorelie Garcia obtained from petitioner 2. Ordering the Register of Deeds of Quezon City to cancel the annotations of the
Home Bankers Savings and Trust Company (formerly Home Savings Bank and Trust mortgage indebtedness between respondents Engr. Jesus Garcia and Home Bankers
Company) a loan in the amount of P4,000,000.00 and without the prior approval of the Savings and Trust Company (formerly Home Savings Bank and Trust Company);
Housing and Land Use Regulatory Board (HLURB), the spouses mortgaged[7] eight lots
covered by TCT Nos. 3349 to 3356 as collateral. Petitioner registered its mortgage on 3. Ordering, likewise the Register of Deeds of Quezon City to cancel the annotation of the
these titles without any other encumbrance or lien annotated therein. The proceeds of the Certificate of Sale in favor of the respondent Home Bankers Savings and Trust Company
loan were intended for the development of the lots into an eight-unit townhouse project. on the following Transfer Certificates of Title to wit:
However, five out of these eight titles turned out to be private respondents townhouses
subject of the contracts to sell with Garcia/TransAmerican.
1) TCT No. 3350
When the loan became due, Garcia failed to pay his obligation to petitioner. 2) TCT No. 3351
Consequently, petitioner instituted an extrajudicial foreclosure [8] on the subject lots and 3) TCT No. 3352
being the highest bidder in the public auction, a certificate of sale [9] in its favor was issued 4) TCT No. 3354
by the sheriff on February 26, 1990. Subsequently, the sheriffs certificate of sale was 5) TCT No. 3356
registered and annotated on the titles of the subject lots in the Register of Deeds of
Quezon City. 4. Ordering respondent Home Bankers Savings and Trust Company (formerly Home
Savings Bank and Trust Company) to:
On November 8, 1990, private respondents filed a complaint with the Office of
Appeals, Adjudication and Legal Affairs (OAALA), HLURB, against Garcia/TransAmerican
as seller/developer of the property and petitioner, as indispensable party, for non-delivery 4.1. AS TO THE FIRST CAUSE OF ACTION
of titles and non-completion of the subdivision project.[10] They prayed for the completion of
the units, annulment of the mortgage in favor of petitioner, release of the mortgage on the Deliver to Complainant Pablo N. Arevalo TCT No. 3352
lots with fully paid owners and delivery of their titles, and for petitioner to compute free from all liens and encumbrances.
individual loan values of amortizing respondents and to accept payments from them and 4.2. AS TO THE SECOND CAUSE OF ACTION
damages.
Deliver to Complainant Alfredo Lim TCT No. 3356 free
Petitioner filed its Answer contending that private respondents have no cause of from all liens and encumbrances.
action against it; that at the time of the loan application and execution of the promissory
note and real estate mortgage by Garcia, there were no known individual buyers of the 4.3. AS TO THE THIRD CAUSE OF ACTION
subject land nor annotation of any contracts, liens or encumbrances of third persons on the
titles of the subject lots; that the loan was granted and released without notifying HLURB To compute and/or determine the loan value of
as it was not necessary. complainant Francisco A. Uy who was not able to
complete or make full payment and to accept payment
Private respondents filed their Reply and a motion for the judgment on the pleadings. and/or receive amortization from said complainant
Petitioner did not file a rejoinder. Private respondents filed a manifestation reiterating for a Francisco A. Uy and upon full payment to deliver TCT
judgment on their pleadings and asked that the reliefs prayed for be rendered as far as No. 3351 free from all liens and encumbrances.
petitioner was concerned. Upon motion of private respondents, the case against
Garcia/TransAmerican was archived for failure to serve summons on him/it despite efforts 4.4. AS TO THE FOURTH CAUSE OF ACTION
to locate his whereabouts or its office. The case was then considered submitted for
decision. To compute and/or determine the loan value of
Complainant Spouses Leandro A. Soriano, Jr. and Lilian
On August 16, 1991, OAALA rendered its Decision, [11] the dispositive portion of Soriano who were not able to complete or make full
which reads: payment and to accept and/or receive amortization from
said Complainants Soriano and upon full payment to
deliver TCT No. 3354 free from all liens and
WHEREFORE, Judgment is hereby rendered as follows:
encumbrances.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
4.5. AS TO THE FIFTH CAUSE OF ACTION C. IN THE EVENT THAT THE DECISION OF THE RESPONDENT COURT
FINDING THE REAL ESTATE MORTGAGE IN FAVOR OF HOME AS
Deliver to complainant Alfredo Lim and Felisa Chi Lim INVALID AND UNENFORCEABLE AGAINST RESPONDENTS IS
TCT No. 3350 free from all liens and encumbrances. UPHELD, THE UNREGISTERED CONTRACTS TO SELL IN FAVOR OF
RESPONDENTS SHOULD ALSO BE HELD VALID ONLY AS TO THE
without prejudice to its right to require respondent Engr. Jesus Garcia/TransAmerican to PARTIES THERETO BUT UNENFORCEABLE AGAINST PETITIONER.
constitute new collaterals in lieu of the said titles sufficient in value to cover the mortgage
obligation.[12] Private respondents filed their Comment and petitioner filed its Reply thereto.
In a Resolution dated February 23, 2004, we gave due course to the petition and
Petitioner filed an appeal with the Board of Commissioners of the HLURB which required the parties to submit their respective memoranda which they complied with.
dismissed the same in a decision dated June 15, 1992. [13] Petitioner then elevated the
case to the Office of the President which rendered a decision dated June 30, The petition is devoid of merit.
1995[14] dismissing the appeal and affirming the June 15, 1992 decision of the HLURB. Notably, the issues raised are mere rehash of the issues already passed upon by the
Petitioners motion for reconsideration was also denied in a Resolution dated May 7, HLURB, the Office of the President and the CA which we uphold as we find no reversible
1996.[15] errors committed.
Petitioner filed a petition for review with the CA which, in the herein assailed decision Petitioner claims that HLURB has no power to declare the mortgage contract over
dated November 28, 1996, denied the petition and affirmed the decision of the Office of the real property executed between a real estate developer and petitioner, a banking
President. The CA applied the case of Union Bank of the Philippines vs. HLURB, et institution, void or unenforceable, as it is properly within the jurisdiction of the Regional
al.,[16] where it was held that the act of a subdivision developer of mortgaging the Trial Court. Petitioner asserts that being a mortgagee of the subject lots and a purchaser in
subdivision without the knowledge and consent of a unit buyer and without the approval of good faith, it is not a project owner, developer, or dealer contemplated under P.D. No.
the National Housing Authority (NHA, now HLURB) is violative of Section 18 of P.D. No. 1344, the law which expanded the jurisdiction of the NHA; and that since there is no seller-
957 thus, falling under the exclusive jurisdiction of HLURB. buyer relationship existing between it and private respondents, HLURB has no jurisdiction
The CA upheld the findings of the OAALA, HLURB that private respondents had to rule on the validity of the mortgage and to annul foreclosure proceedings.
already entered into separate contracts to sell with TransAmerican as early as 1988 while The argument is untenable.
it was only in 1989 that spouses Garcia applied for a loan with petitioner and executed a
mortgage contract over the subject lots; that the proceeds of the loan were purposely The CA did not err in affirming the decision of the Office of the President that HLURB
intended for the development of a property which was the same property subject of the has jurisdiction to declare invalid the mortgage contract executed between
contracts to sell; that despite the contracts to sell, Garcia/TransAmerican did not apprise Garcia/TransAmerican and petitioner over the subject lots insofar as private respondents
petitioner of the existence of these contracts nor did petitioner exhaust any effort to inquire are concerned. It correctly relied on Union Bank of the Philippines vs. HLURB, et
into their existence since petitioner merely relied on the purported clean reconstituted titles al.[18] where we squarely ruled on the question of HLURBs jurisdiction to hear and decide a
in the name of Garcia; that the mortgage of the subject lots without the consent of the condominium buyers complaint for: (a) annulment of a real estate mortgage constituted by
buyers and the authorization of the HLURB is a clear violation of P.D. No. 957; that the the project owner without the consent of the buyer and without the prior written approval of
mortgage contract is void and unenforceable against private respondents. the NHA; (b) annulment of the foreclosure sale; and (c) annulment of the condominium
certificate of title that was issued to the highest bidder at the foreclosure sale, thus:
Petitioners motion for reconsideration was denied by the CA in its Resolution dated
February 19, 1997.[17]
. . . The issue in HLURB Case No. REM-062689-4077 is the validity of the real estate
Petitioner is now before us raising the following grounds in support of its petition: mortgage of Davids condominium unit that FRDC executed in favor of the Union Bank and
Far East Bank without prior approval of the National Housing Authority and the legality of
A. THE OFFICE OF THE PRESIDENT ERRED IN RULING THAT THE HLURB the title which the mortgage banks acquired as highest bidder therefore in the extrajudicial
HAS JURISDICTION TO NULLIFY OR DECLARE UNENFORCEABLE foreclosure sale. The applicable provisions of P.D. No. 957, otherwise known as The
THE REAL ESTATE MORTGAGE VALIDLY CONSTITUTED BY THE Subdivision and Condominium Buyers Protective Decree are quoted hereunder as follows:
OWNER.
B. ASSUMING ARGUENDO THAT THE HLURB HAS JURISDICTION, Sec. 3. NATIONAL HOUSING AUTHORITY. The National Housing Authority shall have
RESPONDENT COURT MANIFESTLY ERRED IN FINDING THE REAL exclusive jurisdiction to regulate the real estate trade and business in accordance with the
ESTATE MORTGAGE IN FAVOR OF HOME AS INVALID AND provisions of this Decree.
UNENFORCEABLE AGAINST RESPONDENTS.
Section 18. Mortgages No mortgage on any unit or lot shall be made by the owner or
developer without prior written approval of the authority. Such approval shall not be
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
granted unless it is shown that the proceeds of the mortgage loan shall be used for the Executive Order No. 90 dated December 17, 1986 changed the name of the Human
development of the condominium or subdivision project and effective measures have been Settlements Regulatory Commission to Housing and Land Use Regulatory Board
provided to ensure such utilization. The loan value of each lot or unit covered by the (HLURB).
mortgage shall be determined and the buyer thereof if any shall be notified before the
release of the loan. The buyer may, at his option, pay his installment for the lot or unit Clearly, FRDCs act of mortgaging the condominium project to Bancom and FEBTC,
directly to the mortgagee who shall apply the payments to the corresponding mortgage without the knowledge and consent of David as buyer of a unit therein, and without the
indebtedness secured by the particular lot or unit being paid for, with a view to enabling approval of the NHA (now HLURB) as required by P.D. No. 957, was not only an unsound
said buyer to obtain title over the lot or unit promptly after full payment thereof. real estate business practice but also highly prejudicial to the buyer. David, who has a
cause of action for annulment of the mortgage, the mortgage foreclosure sale, and the
P.D. No. 1344 of April 2, 1978 expanded the jurisdiction of the National Housing Authority condominium certificate of title that was issued to the UBP and FEBTC as the highest
to include the following: bidders at the sale. The case falls within the exclusive jurisdiction of the NHA (now
HLURB) as provided in P.D. No. 957 of 1976 and P.D. No. 1344 of 1978.
Sec. 1. In the exercise of its function to regulate the real estate trade and business and in
addition to its powers provided for in Presidential Decree No. 957, the National Housing ...
Authority shall have exclusive jurisdiction to hear and decide cases of the following nature:
We hold that the jurisdiction of the HLURB to regulate the real estate trade is broad
A. Unsound real estate business practices; enough to include jurisdiction over complaints for specific performance of the sale, or
annulment of the mortgage, of a condominium unit, with damages. [19]
B. Claims involving refund and any other claims filed by subdivision
lot or condominium unit buyer against the project owner,
developer, dealer, broker or salesman; and Petitioner avers that the Union Bank ruling is not applicable in its case, since it had
no knowledge of any buyer of the subject lots at the time the mortgage was constituted;
C. Cases involving specific performance of contractual and statutory that there was no construction in the subject lots at the time petitioner accepted the same
obligations filed by buyers of subdivision lot or as collateral; that the title to the subject property was still in the process of being
condominium unit against the owner, developer, broker reconstituted and the loan was in fact meant for the development of the subject lots into an
or salesman. eight-unit townhouse project.
We are not persuaded.
On February 7, 1981, Executive Order No. 648 transferred the regulatory and quasi-
judicial functions of the NHA to the Human Settlements Regulatory Commission. Contrary to petitioners claim that there were no buyers of the subject lots at the time
of the constitution of the mortgage, records show that private respondents Arevalo, Uy,
Alfredo Lim and Santos Lim had entered into contracts to sell with Garcia/TransAmerican
Sec. 8. TRANSFER OF FUNCTIONS. The regulatory functions of the National Housing
Authority pursuant to Presidential Decree Nos. 957, 1216, 1344 and other related laws are as early as 1988 for their respective lots. In fact, they, except for Uy, had already fully paid
their townhouse units in 1988 without the certificates of title being delivered to them.
hereby transferred to the Commission, together with such applicable personnel,
appropriation, records, equipment and property necessary for the enforcement and Garcia mortgaged the subject lots without their knowledge and consent.
implementation of such functions. Among these regulatory functions are: While private respondents spouses Soriano bought the subject lots after the
constitution of the mortgage in favor of petitioner, the subject lots are, as early as 1988,
1. Regulation of the real estate trade and business: subdivision lots which as defined under Section 2(e) of P.D. No. 957 to mean any of the
lots, whether residential, commercial, industrial, or recreational in a subdivision
... project[20] are entitled to the protection of P.D. No. 957.
7. Approval of mortgage on any subdivision lot or Under Section 18 of P.D. No. 957, it is provided that no mortgage on any unit or lot
condominium unit made by the owner or developer; shall be made by the owner or developer without prior written approval of the authority.
Such approval shall not be granted unless it is shown that the proceeds of the mortgage
... loan shall be used for the development of the condominium or subdivision project and
11. Hear and decide cases on unsound real estate business effective measures have been provided to ensure such utilization. As in the Union Bank,
practices; claims involving refund filed against project the mortgage was constituted on the subject lots in favor of petitioner without the prior
owners, developers, dealers, brokers, or salesmen; and written approval from the HLURB, thus HLURB has jurisdiction to rule on the validity of the
cases of specific performance. mortgage.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Notwithstanding that petitioner became the owner of the subject lots by being the who had fully paid the purchase price of the units are but the necessary consequences of
highest bidder in the extrajudicial foreclosure sale, it must be remembered that it was first the invalidity of the mortgage for the protection of private respondents.
a mortgagee of the same. Since the lot was mortgaged in violation of Section 18 of P.D.
No. 957, HLURB has jurisdiction to declare the mortgage void insofar as private Anent the second issue, petitioner contends that since the titles on their face were
respondents are concerned and to annul the foreclosure sale. In Far East Bank and Trust free from any claims, liens and encumbrances at the time of the mortgage, it is not obliged
Co. vs. Marquez,[21] we held that Section 18 of P.D. No. 957 is a prohibitory law, and acts under the law to go beyond the certificates of title registered under the Torrens system and
committed contrary to it are void. We said: had every reason to rely on the correctness and validity of those titles.
property was already the subject of any other contract involving buyers or potential buyers. registered owner, for annulment of mortgage and cancellation of title against the
In granting the loan, petitioner bank should not have been content merely with a clean title, mortgagee, China Bank. We found therein that even without the mortgagor, the true
considering the presence of circumstances indicating the need for a thorough investigation Mercedes Oliver can prove in her complaint that she is the real person referred in the title
of the existence of buyers like respondent. Having been wanting in care and prudence, the and she is not the same person using the name who entered into a deed of mortgage with
latter cannot be deemed to be an innocent mortgagee. the mortgagee, China Bank.
In the present case, private respondents, in their complaint, alleged that the
Petitioner cannot claim to be a mortgagee in good faith. Indeed it was negligent, as found mortgage was constituted without the prior written approval of the HLURB which is in
by the Office of the President and by the CA. Petitioner should not have relied only on the violation of Section 18 of P.D. No. 957. Petitioners admission that it granted and released
representation of the mortgagor that the latter had secured all requisite permits and the loan without notifying the HLURB because of its belief that it was not necessary to do
licenses from the government agencies concerned. The former should have required the so, is fatal to petitioners defense. As a consequence thereof, the mortgage constituted in
submission of certified true copies of those documents and verified their authenticity favor of petitioner can be declared invalid as against private respondents even without the
through its own independent effort. presence of Garcia/TransAmerican. It is worthy to mention that the assailed decision was
rendered merely against petitioner and had not made any pronouncement as to
Having been negligent in finding out what respondents rights were over the lot, petitioner Garcia/TransAmericans liability to private respondents for the non-completion of the
must be deemed to possess constructive knowledge of those rights. projects; or to herein petitioner, as mortgagee.
The present case merely involves the liability of petitioner bank to private
As to the third issue, petitioner contends that private respondents were negligent in respondents as buyers of the lots and townhouse units.
failing to register their contracts to sell in accordance with Section 17 of P.D. No. 957; that
private respondents unregistered contracts to sell are binding only on them and WHEREFORE, the petition is DISMISSED for lack of merit.
Garcia/TransAmerican but not on petitioner which had no actual or constructive notice of
the sale at the time the mortgage was constituted. SO ORDERED.
We disagree.
Section 17 of P.D. No. 957[28] provides that the seller shall register the contracts to
sell with the Register of Deeds of Quezon City. Thus, it is Garcias responsibility as seller to
register the contracts and petitioner should not blame private respondents for not doing so.
As we have said earlier, considering petitioners negligence in ascertaining the existence or
absence of authority from HLURB for Garcia/TransAmerican to mortgage the subject lots,
petitioner cannot claim to be an innocent purchaser for value and in good faith. Petitioner
is bound by private respondents contracts to sell executed with Garcia/TransAmerican.
The last paragraph of Section 18 of P.D. No. 957 provides that respondents who
have not yet paid in full have the option to pay their installment for the lot directly to the
mortgagee (petitioner) who is required to apply such payments to the corresponding
mortgage indebtedness secured by the particular lot or unit being paid for, with a view to
enabling said buyer to obtain title over the lot or unit promptly after full payment thereof.
Thus, petitioner is obliged to accept the payment of remaining unpaid amortizations,
without prejudice to petitioner banks seeking relief against the subdivision developer. [29]
Notably, although no issue was taken on the fact that the case against
Garcia/TransAmerican, the developer/seller and mortgagor of the subject lots, was
archived for failure to serve summons on him/it as his whereabouts or the office could not
be located, it must be stated that Garcia/TransAmerican is not an indispensable party
since a final determination on the validity of the mortgage over the subject lots can be
rendered against petitioner. Thus, the absence of Garcia/TransAmerican did not hamper
the OAALA from resolving the dispute between private respondents and petitioner.
In China Bank vs. Oliver,[30] we held that the mortgagor, who allegedly
misrepresented herself to be Mercedes M. Oliver, the registered owner of TCT No. S-
50195, is not an indispensable party in a case filed by a person claiming to be the true
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Conformably with Section 8, Rule 39, 1997 Rules of Civil Procedure, execution
in this case can only be implemented as far as what has been decreed in the
COL. FRANCISCO DELA MERCED, G.R. No. 167140 decision dated September 11, 2001, qualified by the Order of this Court dated
substituted by his heirs namely, LUIS January 20, 2003 with respect [to] the payment of attorneys fees.
CESAR DELA MERCED, BLANQUITA
DELA MERCED nee MACATANGAY, and In view thereof, plaintiffs motion for supplemental writ of execution is DENIED.
MARIA OLIVIA M. PAREDES, Present:
SO ORDERED.[4]
CORONA, C.J., Chairperson,
Petitioners, LEONARDO-DE CASTRO,
BERSAMIN,
The September 11, 2001 Decision referred to in the assailed Order was rendered by this Court in
- versus - DEL CASTILLO, and
G.R. No. 140398, entitled Col. Francisco Dela Merced, substituted by his heirs, namely, BLANQUITA
VILLARAMA, JR., JJ.
GOVERNMENT SERVICE INSURANCE E. DELA MERCED, LUIS CESAR DELA MERCED, BLANQUITA E. DELA MERCED (nee
SYSTEM (GSIS) and Spouses VICTOR and
MACATANGAY), and MARIA OLIVIA M. PAREDES, v. GOVERNMENT SERVICE INSURANCE
MILAGROS MANLONGAT,
Promulgated:
SYSTEM (GSIS) and SPOUSES VICTOR and MILAGROS MANLONGAT.[5] The fallo of the said
Respondents. November 23, 2011
x-------------------------------------------------------------------x Decision reads:
DECISION WHEREFORE, in view of the foregoing, the petition is GRANTED. The decision
of the Court of Appeals is REVERSED AND SET ASIDE. The decision of
the Regional Trial Court of Pasig City, Branch 160, in Civil Case Nos. 51410
and 51470, is REINSTATED. The foreclosure sale of Lot Nos. 6, 7, 8 and 10 of
DEL CASTILLO, J.: Block 2 and Lot 8 of Block 8 of the property originally covered by TCT 26105,
and the subsequent certificates of titles issued to GSIS as well as TCT No. PT-
94007 in the name of Elizabeth Manlongat, are declared NULL AND
A transferee pendente lite of registered land, whose title bears a notice of a pending litigation involving VOID. The Register of Deeds of Pasig City is ordered to CANCEL all present
certificates of title in the name of GSIS and Elizabeth Manlongat covering the
his transferors title to the said land, is bound by the outcome of the litigation, whether it be for or above-mentioned properties, and to ISSUE new certificates of title over the
same in the name of petitioners as co-owners thereof. Respondents GSIS and
against his transferor. Given this principle, the modification of the final decision against the transferor spouses Victor and Milagros Manlongat are ORDERED to pay, jointly and
severally, attorneys fees in the increased amount of P50,000.00, and to pay the
in order to include the transferee pendente lite does not violate the doctrine of immutability of final costs.
judgments. His inclusion does not add to or change the judgment; it is only a legal consequence of SO ORDERED.[6]
the established doctrine that a final judgment binds the privy of a litigating party.
G.R. No. 140398 has long attained finality[7] but could not be executed because of the objections
Before the Court is a Petition for Review[1] assailing the validity of the February 9, 2005 Order[2] of raised by the Register of Deeds (RD) and respondent Government Service Insurance System
Branch 160 of the Regional Trial Court (RTC) of Pasig City. The said Order denied petitioners motion (GSIS). These objections, which the trial court found insurmountable in its assailed February 9, 2005
for supplemental writ of execution:[3] Order, are now presented to us for resolution.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Factual antecedents After a protracted litigation, the case reached this Court as G.R. No. 140398. On September 11,
2001, a Decision[16] was rendered in petitioners favor. The Court nullified GSISs foreclosure of the
This case involves five registered parcels of land located within the Antonio Subdivision, Pasig City subject properties because these lots were never part of its mortgage agreement with the Zulueta
Lots 6, 7, 8, and 10 of Block 2 and Lot 8 of Block 8 (subject properties). These lots were originally spouses. The dispositive portion of said Decision reads:
owned by, and titled in the name of, Jose C. Zulueta (Zulueta), as evidenced by Transfer Certificate of
WHEREFORE, in view of the foregoing, the petition is GRANTED. The decision
Title (TCT) No. 26105.[8] TCT No. 26105 contains several lots, other than the subject properties, of the Court of Appeals is REVERSED AND SET ASIDE. The decision of
the Regional Trial Court of Pasig City, Branch 160, in Civil Case Nos. 51410
within the Antonio Subdivision. and 51470, is REINSTATED. The foreclosure sale of Lot Nos. 6, 7, 8 and 10 of
Block 2 and Lot 8 of Block 8 of the property originally covered by TCT 26105,
and the subsequent certificates of titles issued to GSIS as well as TCT No. PT-
94007 in the name of Elizabeth Manlongat, are declared NULL AND VOID.
Later, the Zulueta spouses mortgaged[9] several lots contained in TCT No. 26105 to the GSIS, which The Register of Deeds of Pasig City is ordered to CANCEL all present
certificates of title in the name of GSIS and Elizabeth Manlongat covering the
eventually foreclosed on the mortgaged properties, including the subject properties. Upon above-mentioned properties, and to ISSUE new certificates of tile over the
same in the name of petitioners as co-owners thereof. Respondents GSIS and
consolidation of GSISs ownership, TCT No. 26105 in Zuluetas name was cancelled, and TCT No. spouses Victor and Milagros Manlongat are ORDERED to pay, jointly and
severally, attorneys fees in the increased amount of P50,000.00, and to pay the
23554[10] was issued in GSISs name.[11] costs.[17]
a complaint[12] praying for the nullity of the GSIS foreclosure on the subject properties (Lots 6, 7, 8,
Pursuant to the finality of the above Decision, petitioners filed a Motion for Execution[19] with Branch
and 10 of Block 2 and Lot 8 of Block 8) on the ground that he, not the Zuluetas, was the owner of
160 of the RTC of Pasig City.
these lots at the time of the foreclosure. Dela Merced also impleaded Victor and Milagros
Manlongat,[13] who were claiming Lot 6, Block 2 by virtue of a sale executed by the GSIS in their
First obstacle:
GSISs alleged exemption from execution
daughters (Elizabeth Manlongat) favor.[14] Dela Merced argued that, due to the nullity of GSISs
foreclosure over the subject properties, it had no ownership right that could be transferred to Elizabeth
GSIS opposed the motion for execution, citing as basis Section 39 of Republic Act No. 8291 (RA
Manlongat.
8291), also known as the GSIS Act of 1997. The said provision allegedly exempts GSIS funds and
properties from attachment, garnishment, execution, levy and other court processes.[20]
Dela Merced caused the annotation of lis pendens[15] on GSISs TCT No. 23554 on September 21,
1984 in order to protect his interests in the subject properties. Dela Merced died in 1988 and was
On January 20, 2003, the trial court granted petitioners motion for execution; but held in abeyance the
substituted by his heirs, the petitioners in the instant case.
execution of the award of attorneys fees, pending clarification before the higher courts of the issue of
GSISs exemption under Section 39 of RA 8291. The said Order is reproduced below:
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
petitioner GSIS may have on the subject properties were non-existent from the
very beginning. Verily, the court a quowas right then in issuing the writ of
Acting on the Motion for Execution filed by the plaintiff herein together with the execution dated 24 July 2003 and that petitioner GSIS claim that it should be
opposition of defendant GSIS, and considering that the judgment has already exempted from execution has no basis in fact and in law.[28]
become final and executory, the same is hereby Granted.
xxxx
As prayed for, let a writ of execution issue to enforce the judgment of this court.
We lay stress that the pronouncement made in the abovementioned SC circular
However, with respect to the payment of attorneys fees in the increased amount and in the case of Commissioner of Public Highways vs. San Diego, cited in the
of P50,000.00 which has to be paid jointly and severally by the GSIS and Sps. Armovit case find no application in the case at bar. It must be noted that the
Manlongat, the same is held in abeyance as far as GSIS is concerned pending properties referred to therein are those owned by government which could not
clarification by the GSIS before the Supreme Court on the issue of whether its be seized under writ of execution to satisfy such judgment because to do so,
funds and assets are exempt from execution pursuant to Section 39, R.A. 8291, there is a necessity for the corresponding appropriation of public funds by
otherwise known as the GSIS Act of 1997. Congress before the same could be disbursed. In this instant case, it has
already been settled that the herein properties involved are not owned by
SO ORDERED.[21] petitioner GSIS; hence, there is no prohibition that the same could be executed
and that there is no public funds involved which require the corresponding
A writ of execution was issued on July 24, 2003.[22] appropriation thereof. x x x[29]
Eventually, GSIS filed with the Court of Appeals (CA) a petition for certiorari and prohibition against xxxx
the trial courts implementation of the writ of execution against it.[23] The petition, docketed as CA-G.R. In fine, the execution of the subject properties is proper for to assert otherwise,
would be depriving private respondents dela Merced and Paredes of their
SP No. 87821, presented the issue whether the trial judge gravely abused her discretion in ordering properties without due process of law as it had been clearly established on
record that they really owned the subject properties.To sustain petitioner GSIS
execution against GSIS funds and properties despite their alleged express and absolute exemption view that it should be exempt from execution would be putting the subject
properties beyond the reach of the rightful owners thereof x x x. Likewise, to
from execution, garnishment, and other court processes under Section 39 of RA 8291.[24] uphold petitioner GSIS theory would inevitably lead to a disastrous
consequence and lend imprimatur to deprivation of property without due
process of law. Additionally, to grant petitioner GSIS prayer that the subject
properties be exempt from execution without any factual and legal basis thereof
In its October 28, 2005 Decision, the CA dismissed GSISs petition and held that execution may be
would resultantly remain the same in the custody or control of petitioner GSIS
which unjustly enriches itself at the expense of private respondents dela Merced
enforced against it.[25] The ratio of the appellate court is reproduced in part:
and Paredes and who the latter could be deprived of the beneficial
use/ownership thereof when in the very first place they were able to establish
the ownership thereof. Every person who through an act or performance by
Public respondent court presided by Hon. Amelia A. Fabros did not commit
another, or any other means, acquires or comes into possession of something
grave abuse of discretion when it issued the Writ of Execution dated 24 July
2003. It must be considered that the properties which (Lots 6, 7, 8, and 10 of at the expense of the latter without just or legal ground, shall return the same to
him.[30]
Block 2 and Lot 8 of Block 8 of Antonio Subdivision) were the subject of the writ
of execution in the instant case are not the properties of petitioner GSIS. In the
xxxx
court a quos Decision dated October 23, 1987 and reiterated in the Honorable
Supreme Courts Decision dated September 11, 2001, it declared inter alia that
WHEREFORE, premises considered, the instant PETITION FOR
the certificates of title issued to petitioner GSIS pertaining to Lot Nos. 6, 7, 8, and
CERTIORARI and PROHIBITION is hereby DISMISSED. Accordingly, the Writ
10 of Block 2 and Lot 8 of Block 8 are null and void and further directed inter
of Execution dated 24 July 2003 and the Order dated 16 September 2004 both
alia the Register of Deeds of Pasig City to cancel all the present certificates of
rendered by the Regional Trial Court of Pasig City, Branch 160 stand.
title in the name of petitioner GSIS. x x x[26]
SO ORDERED. [31]
xxxx
[P]etitioner GSIS has no interest over the subject properties and x x x had never
validly acquired ownership thereof. x x x[27] Therefore, any and all [rights] that
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Land Titles and Deeds (Finals) 2017
GSISs motion for reconsideration of the above Decision was denied in the June 30, 2006 Resolution these two lots. The RD thus suggested that the parties provide him with these relevant information
of the appellate court.[32] GSIS appealed the CA Decision to this Court[33] but the petition was denied in before he can proceed.
a Resolution dated February 12, 2007,[34]which denial was entered in the Book of Judgments on
October 2, 2007.[35] In order to address these difficulties, petitioners filed before the trial court a Motion for Supplemental
Second obstacle:
Alleged inadequacy of the fallo Writ of Execution.[39] They prayed for a supplemental writ ordering the RD to cancel the titles over Lots
7 and 8 of Block 2 in GSISs name or in the name of other subsequent transferees; and directing the
After the resolution of the issue of GSISs exemption, petitioners encountered more problems with the GSIS and the Bureau of Lands to supply the RD with the technical descriptions of Lot 10, Block 2,
execution of the September 11, 2001 Decision in G.R. No. 140398. According to the RD of Pasig and Lot 8, Block 8.[40]
City, Policarpio Espenesin, he could not enforce the Decision in G.R. No. 140398 as worded.
The order to cancel the titles of GSIS over Lots 7 and 8 of Block 2 allegedly could not be enforced GSIS opposed the issuance of a supplemental writ of execution.[41]
because GSIS no longer had title over these two lots. GSIS had already conveyed these lots in 1985
and 1988 to Diogenes Bartolome (Lot 8) and Antonio Dimaguila [Dimaguila] (Lot 7), respectively. At On February 9, 2005, Judge Amelia A. Fabros issued the assailed order denying petitioners motion
present, Lot 7 of Block 2 is titled in Dimaguilas name (TCT No. PT-67466)[36] while Lot 8 of Block 2 is for supplemental writ of execution.
titled in the name of Bartolomes assignee, Zenaida Victorino [Victorino] (TCT No. 53031).[37] While
both titles contain notices of lis pendens carried over from GSISs title,[38] the RD claimed that the writ Respondents arguments
of execution must first be modified to include the cancellation of derivative titles of the GSIS title.
The Manlongats could not be served with copies of the Courts resolutions; hence the Court
The RD also found difficulty in implementing the order to cancel GSISs titles over Lot 10 of Block 2 dispensed with their comment.[42]
and Lot 8 of Block 8 and to issue new ones in petitioners name because no such individual titles exist
in his records. The RD posited that these two lots must still be included in GSISs mother title, TCT GSIS argues that petitioners motion was properly denied because it seeks
No. 23554. The RD opined that he cannot cancel GSISs mother title, even if it contains Lot 10 of to modify a final and executory Decision. The September 11, 2001 Decision in G.R. No. 140398 only
Block 2 and Lot 8 of Block 8 because it would affect other lots that might still be included therein. ordered the cancellation of GSISs titles over the subject properties. It did not order the cancellation of
all derivative titles of GSISs transferees; nor did it order the GSIS to perform acts such as providing
The RD further lamented that assuming he could cancel GSISs mother title with respect to Lot 10 of the RD with the technical descriptions for Lot 10, Block 2 and Lot 8, Block 8. GSIS maintains that a
Block 2 and Lot 8 of Block 8, there is still no way that he could issue new titles over these lots in supplemental writ that includes such additional orders is null and void for non-conformity with the
petitioners name. This is because his office has no information regarding the technical descriptions for judgment.
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Land Titles and Deeds (Finals) 2017
Further, GSIS argues that the inclusion of derivative titles in the September 11, 2001 Decision in G.R. Petitioners maintain that execution of the Decision in G.R. No. 140398 should not be confined to the
No. 140398 would deprive the holders of these derivative titles their day in court. GSIS opines that the literal terms contained only in the fallo or the dispositive portion.[46]
holders of the derivative titles are not bound by the judgment against GSIS because these holders
are strangers to the action between GSIS and petitioners. As regards GSISs alleged exemption, petitioners posit that the GSIS can no longer raise the issue of
exemption from execution given that the CA had already rendered its Decision on that question in
Lastly, GSIS again raises its earlier argument that the September 11, 2001 Decision in G.R. No. CA-G.R. SP No. 87821. The said Decision was affirmed by this Court in G.R. No. 173391 through
140398 cannot be enforced because of GSISs exemption from court processes under RA 8291. our February 12, 2007 Resolution[47] and entry of judgment in that case was made on October 2,
2007.[48]
Petitioners counter that the September 11, 2001 Decision in G.R. No. 140398 can be enforced Can GSIS still raise the issue of exemption?
against GSISs transferees pendente lite because these transferees were given notice of the Whether a final and executory judgment against GSIS and Manlongat can be enforced against their
successors-in-interest or holders of derivative titles
pendency of the case by virtue of the notice of lis pendens that had been inscribed on GSISs TCT
Whether an order to cancel title to a particular property includes an order to provide technical
No. 23554 as early as September 21, 1984. In fact, when TCT No. 23554 was cancelled with respect descriptions and segregate it from its mother title
to Lots 7 and 8 of Block 2 in order to issue new titles in Dimaguilas and Victorinos names, this notice
was carried over to their respective titles. Moreover, the conveyance of these lots to Victorino and Our Ruling
Dimaguila transpired in 1985 and 1988, respectively; clearly during the pendency of the case and with On the issue of GSISs exemption
notice of the questions surrounding GSISs ownership over these properties.
The issue of GSISs alleged exemption under RA 8291 had been finally decided against GSIS in G.R.
As transferees pendente lite, Dimaguilas and Victorinos titles are proper subjects of writs of execution No. 173391, when this Court denied GSISs petition for review. The denial rendered the CA Decision
[43]
even if they were not actual parties to the case. Petitioners cite Voluntad v. Spouses Dizon as their in CA-G.R. SP No. 87821 final and executory. GSISs attempt to resurrect the same issue by
authority.[44] interjecting the same in this proceeding is barred by the principle of law of the case, which states
that determinations of questions of law will generally be held to govern a case throughout all its
With regard to the issuance of new titles for Lot 10, Block 2 and Lot 8, Block 8, petitioners argue that subsequent stages where such determination has already been made on a prior appeal to a court of
GSIS can be compelled to provide the RD with their respective technical descriptions. This power is last resort.[49] The Decision in G.R. No. 173391 allowing the execution of the judgment against GSIS
granted to the courts under Section 10, Rule 39 of the Rules of Court.[45] is the law of the case and controls the proceedings below which are already in the execution stage.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
subject to whatever rights GSIS might have in the subject properties, which (as it turns out) is none at
Enforcement of judgment against
transferees pendente lite all. What Dimaguila and Victorino possess are derivative titles of the GSISs title over Lots 7 and 8 of
Block 2, which this Court has finally adjudicated to be null and void. Given the legal maxim that a
A notice of lis pendens is an announcement to the whole world that a particular real property is in spring cannot rise higher than its source, it follows that Dimaguilas and Victorinos titles, or any other
litigation, serving as a warning that one who acquires an interest over said property does so at his title over the subject properties that are derived from TCT No. 23554 of the GSIS, are likewise null
own risk, or that he gambles on the result of the litigation over the said property.[50] The effect of the and void. As explained by this Court in another case, the title obtained by the transferee pendente
annotation of lis pendens on future transactions over the subject property is discussed by an authority lite affords him no special protection; he cannot invoke the rights of a purchaser in good faith and
on land titles and registration: cannot acquire better rights than those of his predecessor-in-interest.[55]
involving GSISs ownership over the subject properties, and were bound by the outcome of the Admittedly, during the pendency of the case, respondents timely registered a
notice of lis pendens to warn the whole world that the property was the subject
litigation. When a transferee pendente lite takes property with notice of lis pendens, such transferee of a pending litigation.
undertakes to respect the outcome of the litigation. As held in Selph v. Vda. de Aguilar,[53] an order to Lis pendens, which literally means pending suit, refers to the jurisdiction, power
or control which a court acquires over property involved in a suit, pending the
cancel the transferors title may be enforced against his transferee, whose title is expressly subject to continuance of the action, and until final judgment. Founded upon public policy
and necessity, lis pendens is intended to keep the properties in litigation within
the outcome of the litigation by the fact of the annotation of lis pendens. the power of the court until the litigation is terminated, and to prevent the defeat
of the judgment or decree by subsequent alienation. x x x
The filing of a notice of lis pendens has a twofold effect: (1) to keep the subject
The existence of these entries on Dimaguilas and Victorinos titles bars any defense of good matter of the litigation within the power of the court until the entry of the final
judgment to prevent the defeat of the final judgment by successive alienations;
faith[54] against petitioners and effectively makes Dimaguila and Victorino mere privies of GSIS and and (2) to bind a purchaser, bona fide or not, of the land subject of the litigation
to the judgment or decree that the court will promulgate subsequently.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
This registration, therefore, gives the court clear authority to cancel the title of the therefrom. To effectuate such segregation, the RD needed the technical descriptions of the two lots
spouses Vaca, since the sale of the subject property was made after the notice
of lis pendens. x x x[59] and the mother title. Thus, petitioners ask that the GSIS be compelled to surrender its title over, as
well as the technical descriptions of, Lot 10, Block 2 and Lot 8, Block 8.
Upon Associated Banks MR, the spouses Vaca filed a motion to intervene arguing that they had a GSIS refused to turn over the needed documents and information, claiming that these acts go
real interest in assailing the July 14, 2008 Decision, which ordered the cancellation of their title. The beyond what were ordered in the Decision in G.R. No. 140398. GSISs protestations ring hollow.
Court denied the intervention. It was held that the interests of the spouses Vaca in the subject
property were properly represented in the action by their transferor/vendor Associated Bank, which The order contained in the Decision in G.R. No. 140398 is for the RD to cancel GSISs titles over Lot
was already a party thereto. As transferees pendente lite, the spouses Vaca stand exactly in the 10, Block 2 and Lot 8, Block 8, inter alia. Whether these titles are individual or contained in a mother
shoes of their predecessor-in-interest, Associated Bank.[60] title is of no consequence. The RD has to cause their cancellation. If the cancellation can only be
The Court cannot accept GSISs theory that the dispositive portion of the Decision in G.R. No. 140398 carried out by requiring GSIS or the Bureau of Lands to provide the necessary information, then they
is enforceable only against GSISs title because it does not contain the phrase and all its derivative can be compelled to do so. Otherwise, the Courts decision would be rendered inefficacious,
titles. GSISs narrow interpretation would render nugatory the principle that a final judgment against a and GSIS would retain ostensible ownership over the lots by the simple expedience that they are
party is binding on his privies and successors-in-interest. We cannot sustain this included in a mother title, instead of individual titles. That result is manifestly contrary to the Courts
interpretation. In Cabresos v. Judge Tiro,[61] the Court upheld the respondent judges issuance of an ruling and would subvert the very purpose of bringing this case for a complete resolution.
alias writ of execution against the successors-in-interest of the losing litigant despite the fact that these A similar predicament was ruled upon by the Court in Republic Surety and Insurance Co., Inc. v.
successors-in-interest were not mentioned in the judgment and were never parties to the case. The Intermediate Appellate Court.[62] In that case, the Court declared that Republic Mines had no right to
Court explained that an action is binding on the privies of the litigants even if such privies are not the property involved but during the execution, the RD refused to cancel the TCT in Republic Mines
literally parties to the action. Their inclusion in the writ of execution does not vary or exceed the terms name on the ground that the dispositive portion of the trial courts Decision did not order the RD to
of the judgment. In the same way, the inclusion of the derivative titles in the writ of execution will not cancel the title and to revive the old title in favor of the victorious party. The Court held that the missing
alter the Decision in G.R. No. 140398 ordering the cancellation of GSISs title. order to cancel and revive should be deemed implied in the trial courts decision. Speaking through
Cancellation of title
What is involved here is not what is ordinarily regarded as a clerical error in the
dispositive part of the decision of the Court of First Instance, which type of error
is perhaps best typified by an error in arithmetical computation. At the same
The RD claimed that it cannot execute the order to cancel the GSISs titles over Lot 10, Block 2 time, what is involved here is not a correction of an erroneous judgment or
dispositive portion of a judgment. What we believe is involved here is in the
and Lot 8, Block 8 because it has no record of GSISs title over these two lots. The RD theorized that nature of an inadvertent omission on the part of the Court of First Instance x x x,
of what might be described as a logical follow-through of something set forth
these lots are included in a mother title in GSISs possession and would still have to be segregated both in the body of the decision and in the dispositive portion thereof: the
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
xxxx WHEREFORE, the petition is GRANTED. The February 9, 2005 Order of Branch 160 of
the Regional Trial Court of Pasig City is REVERSED and SET ASIDE. The September 11, 2001
There are powerful considerations of an equitable nature which impel us to the
conclusions we reach here. Substantial justice cannot be served if
Decision in G.R. No. 140398 is clarified to read as follows:
the petitioner Republic Mines, having absolutely no right, legal or equitable, to
the property involved, its claim thereto being based upon a transaction which
was not only simulated but also immoral and unconscionable, should be WHEREFORE, in view of the foregoing, the petition is GRANTED. The decision
allowed to retain the Transfer Certificate of Title in its name. The petitioner would
of the Court of Appeals is REVERSED AND SET ASIDE.
thereby be in a position to inflict infinite mischief upon the respondent-spouses
The decision of the Regional Trial Court of Pasig City, Branch 160, in Civil Case
whom they deprived for 15 years of the possession of the property of which they
Nos. 51410 and 51470, is REINSTATED. The foreclosure sale of Lot Nos. 6, 7,
were and are lawful owners, and whom they compelled to litigate for 15 years to
8 and 10 of Block 2 and Lot 8 of Block 8 of the property originally covered by
recover their own property. The judicial process as we know it and as
TCT No. 26105, and the subsequent certificates of titles issued to GSIS as well
administered by this Court cannot permit such a situation to subsist. It cannot be
as TCT No. PT-94007 in the name of Elizabeth Manlongat, and their
an adequate remedy for the respondent-spouses to have to start once more in respective derivative titles are declared NULL AND VOID.
the Court of First Instance, to ask that court to clarify its own judgment, a
process which could be prolonged by the filing of petitions for review in the Court The Register of Deeds of Pasig City is ordered to CANCEL all present
of Appeals and eventually in this Court once more. Public policy of the most
certificates of title covering the above-mentioned properties, whether
fundamental and insistent kind requires that litigation must at last come to an contained in individual titles or in a mother title, in the name of GSIS and
end if it is not to become more pernicious and unbearable than the very injustice
Elizabeth Manlongat, or in the name of their privies, successors-in-interest
or wrong sought to be corrected thereby. That public policy demands that we
or transferees pendente lite, and to ISSUE new certificates of title over the
cut this knot here and now.[64]
same in the name of petitioners as co-owners thereof.
GSIS and the Bureau of Lands are ordered to supply the necessary
When a judgment calls for the issuance of a new title in favor of the winning party (as in the instant
documents and information for the proper enforcement of the above
orders.
case), it logically follows that the judgment also requires the losing party to surrender its title for
cancellation. It is the only sensible way by which the decision may be enforced. To this end, Respondents GSIS and spouses Victor and Milagros Manlongat are
ORDERED to pay, jointly and severally, attorneys fees in the increased amount
petitioners can obtain a court order requiring the registered owner to surrender the same and directing of P50,000.00, and to pay the costs.
SO ORDERED.
the entry of a new certificate of title in petitioners favor.[65] The trial court should have granted
The trial court is ordered to ISSUE the writ of execution in accordance with the above clarified
petitioners motion for supplemental writ of execution as it had authority to issue the necessary orders
dispositive portion.
to aid the execution of the final judgment.[66]
GSIS is seriously warned not to further delay the execution of this case.
SO ORDERED.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
G.R. No. 204280, November 09, 2016 Bernardo testified that when he went abroad on October 19, 1997, he left the owner's copy
of the TCT of the subject property to Jovannie as they intended to sell the subject
EVELYN V. RUIZ, Petitioner, v. BERNARDO F. DIMAILIG, Respondent. property.10 However, on January 26, 1998, a REM was executed on the subject property.
Bernardo argued that his alleged signature appearing therein was merely forged11 as he
was still abroad at that time. When he learned in September or November 1998 that Editha
DECISION mortgaged the subject property, he personally told Evelyn that the REM was fake and
demanded the return of his title. Not heeding his request, he filed a complaint for estafa
DEL CASTILLO, J.: through falsification of public document against Editha and Evelyn. The criminal case
against Evelyn was dismissed12 while Editha was found guilty as charged. 13
This Petition for Review on Certiorari assails the October 22, 2012 Decision1 of the Court
of Appeals (CA) in CA-GR. CV No. 95046 which reversed and set aside the November Jovannie also took the witness stand. He testified that sometime in December 1997,
26,2009 Decision2 and the March 19, 2010 Order3 of the Regional Trial Court (RTC) of Editha convinced him to surrender the owner's copy of TCT No. T-361747 which she
Cavite City, Branch 16 in Civil Case No. N-7573. The CA declared void the Real Estate would show her buyer.14Subsequently, however, Editha informed him that she misplaced
Mortgage (REM) constituted on the property covered by Transfer Certificate of title (TCT) the title. Hence, he executed in August 199815 an affidavit of loss and registered it with the
No. T-361747. Register of Deeds (RD).16 In September 1998, Editha finally admitted that the title was not
lost but was in Evelyn's possession because of the REM. 17 Upon learning this, Jovannie
inquired from Evelyn if Editha mortgaged Bernardo's property to her. Purportedly, Evelyn
Factual Antecedents confirmed said mortgage and told him that she would not return the owner's copy of TCT
No. T-361747 unless Editha pay the loan,18 Jovannie also alleged that he told Evelyn that
Respondent Bernardo F. Dimailig (Bernardo) was the registered owner of a parcel of land Bernardo's alleged signature in the REM was not genuine since he was abroad at the time
covered by TCT No. T-361747 located in Alapan, Imus, Cavite. 4 In October 1997, he of its execution.19
entrusted the owner's copy of the said TCT to his brother, Jovannie, 5 who in turn gave the
title to Editha Sanggalang (Editha), a broker, for its intended sale. However, in January On the other hand, Evelyn maintained that she was a mortgagee in good faith. She
1998, the property was mortgaged to Evelyn V. Ruiz (Evelyn) as evidenced by a Deed of testified that sales agents - Editha, Corazon Encarnacion, and a certain Parani, - and a
REM6 without Bernardo's knowledge and consent. Hence, Bernardo instituted this suit for person introducing himself as ''Bernardo" mortgaged the subject property to her for
annulment of the Deed of REM.7 P300,000.00 payable within a period of three months. 20 She asserted that even after the
expiration of said period, "Bernardo" failed to pay the loan. 21
In her Answer,8 Evelyn contended that she met Jovannie when she inspected the subject
property and assured her that Bernardo owned the property and his title thereto was Evelyn narrated that before accepting the mortgage of the subject property, she, the sales
genuine. She further claimed that Jovannie mortgaged the property to her. She also agents, her aunt, and Bernardo," visited the property. She pointed out that her
insisted that as a mortgagee in good faith and for value, the REM cannot be annulled and companions inspected it while she stayed in the vehicle as she was still recuperating from
that she had the right to keep the owner's copy of TCT No. T-361747 until the loan was an operation.22 She admitted that she neither verified from the neighborhood the owner of
fully paid to her. the property nor approached the occupant thereof. 23
During pre-trial the parties arrived at the following stipulations:9 Moreover, Evelyn asserted that when the Deed of REM was executed, the person who
introduced himself as Bernardo presented a community tax certificate and his picture as
1. That x x x it was not [Bernardo] who signed as mortgagor in the subject Deed of Real proof of identity.24 She admitted that she did not ask for any identification card from
Estate Mortgage. "Bernardo."25cralawred
2. That there was a demand letter sent to [Evelyn] x x x to cause a release of mortgage on Contrary to the allegation in her Answer that Jovannie mortgaged the property, Evelyn
the subject property. clarified that she met Jovannie for the first time when he went to her house and told her
that Bernardo could not have mortgaged the property to her as he was abroad. 26
3. The x x x controversy [was referred] to the Barangay for conciliation and mediation.
Corazon Abella Ruiz (Corazon), the sister-in-law of Evelyn, was presented to corroborate
her testimony. Corazon averred that in January 1998, she accompanied Evelyn and
[4.] That Jovannie x x x is the brother of [Bernardo].chanroblesvirtuallawlibrary several others in inspecting the subject property. 27 The day after the inspection, Evelyn
and "Bernardo'' executed the Deed of REM in the office of a certain Atty. Ignacio; Evelyn
Thereafter, trial on the merits ensued.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
handed P300,000.00 to Editha, not to "Bernardo;"28 in turn, Editha handed to Evelyn the purported owner was present during the inspection of the property, and during the
owner's copy of TCT No. T-361747.29 execution of the REM.
Ruling of the Regional Trial Court In sum, the CA ruled that for being a forged instrument, the Deed of REM was a nullity,
and the owner's copy of TCT No. T-361747 must be returned to its rightful owner,
Bernardo.
On November 26, 2009, the RTC dismissed the Complaint. It held that while Bernardo was
the registered owner of the subject property, Evelyn was a mortgagee in good faith
because she was unaware that the person who represented himself as Bernardo was an Issue
impostor. It noted that Evelyn caused the verification of the title of the property with the RD
and found the same to be free from any lien or encumbrance. Evelyn also inspected the
Hence, Evelyn filed this Petition raising the sole assignment of error as
property and met Jovannie during such inspection. Finally, the RTC declared that there follows: ChanRoblesVirtualawlibrary
was no showing of any circumstance that would cause Evelyn to doubt the validity of the
title or the property covered by it. In fine, Evelyn did all that was necessary before parting
with her money and entering Into the REM. [T]he Court of Appeals erred in holding that petitioner is not a mortgagee in good faith
despite the presence of substantial evidence to support such conclusion of fact. 33
On March 19, 2010, the RTC denied Bernardo's Motion for Reconsideration. Thus, he
appealed to the CA. Petitioners Arguments
Ruling of the Court of Appeals Petitioner insists that she is a mortgagee in good faith. She claims that she was totally
unaware of the fraudulent acts employed by Editha, Jovannie, and the impostor to obtain a
loan from her. She stresses that a person dealing with a property covered by a certificate
On October 22, 2012, the CA rendered the assailed Decision reversing and setting aside of title is not required to look beyond what appears on the face of the title.
the RTC Decision. The decretal portion of the CA Decision
reads: ChanRoblesVirtualawlibrary
Respondent's Arguments
WHEREFORE, the appeal is GRANTED. The assailed dispositions of the RTC are
REVERSED and SET ASIDE. Tile complaint of Bernardo F. Dimailig is GRANTED. The Bernardo, on his end, contends that since the person who mortgaged the property was a
Deed of Real Estate Mortgage constituted on the real property covered by TCT No. T- mere impostor, then Evelyn cannot claim that she was a mortgagee in good faith. This is
361747 of the Registry of Deeds for the Province of Cavite, registered in his name, is because a mortgage is void where the mortgagor has no title at all to the property subject
DECLARED null and void. Evelyn V. Ruiz is ORDERED to reconvey or return to him the of such mortgage.
owner's duplicate copy of the said title. His claims for the payment of attorney's fees and
costs of suits are DENIED. Costs against Evelyn V. Ruiz. Bernardo asserts that there were circumstances that should have aroused suspicion on
the part of Evelyn relative to the mortgagor's title over the property. He specifies that
SO ORDERED.30 throughout the negotiation of the mortgage, Evelyn transacted only with Editha, not with
"Bernardo," despite the fact that Editha and the other real estate agents who assisted
Evelyn in the mortgage transaction were not armed with a power of attorney.
The CA held that the "innocent purchaser (mortgagor in this case) for value protected by
law is one who purchases a titled land by virtue of a deed executed by the registered
owner himself, not by a forged deed."31 Since the Deed of REM was forged, and the title to Bernardo likewise stresses that although Evelyn caused the inspection of the subject
the subject property is still in the name of the rightful owner, and the mortgagor is a property, she herself admitted that she did not alight from the vehicle during the inspection,
different person who only pretended to be the owner, then Evelyn cannot seek protection and she failed to verify the actual occupant of the property.
from the cloak of the principle of mortgagee in good faith. The CA held that in this case,
''the registered owner will not personally lose his title." 32 Our Ruling
The CA further decreed that Evelyn's claim of good faith cannot stand as she failed to The Petition is without merit.
verify the real identity of the person introduced by Editha as Bernardo. It noted that the
impostor did not even exhibit any identification card to prove his identity; and, by Evelyn's
admission, she merely relied on the representation of Editha relative to the identity of As a rule, the issue of whether a person is a mortgagee in good faith is not within the ambit
"Bernardo." It also held that Evelyn transacted only with Editha despite the fact that the of a Rule 45 Petition. The determination of presence or absence of good faith, and of
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
negligence factual matters, which are outside the scope of a petition for review Book is remarkably different from the signature on the assailed mortgage contract. The
on certiorari.34 Nevertheless, this rule allows certain exceptions including cases where the variance is obvious even to the untrained eye. This is further bolstered by Evelyn's
RTC and the CA arrived at different or conflicting factual findings, 35 as in the case at admission that Bernardo was not the one who represented himself as the registered owner
bench. As such, the Court deems it necessary to re-examine and re-evaluate the factual of the subject property and was not the one who signed the questioned contract. Thus,
findings of the CA as they differ with those of the RTC. there can be no denying the fact that the signature on the Deed of Real Estate Mortgage
was not affixed or signed by the same person. 41
No valid mortgage will arise unless the mortgagor has a valid title or ownership over the
mortgaged property. By way of exception, a mortgagee can invoke that he or she derived In fact, during pre-trial, both parties agreed that it was not Bernardo who signed as the
title even if the mortgagor's title on the property is defective, if he or she acted in good mortgagor in the Deed of REM. It was only an impostor - representing himself as Bernardo
faith. In such instance, the mortgagee must prove that no circumstance that should have - who mortgaged the property. This impostor is not only without rightful ownership on the
aroused her suspicion on the veracity of the mortgagor's title on the property was mortgaged property, he also has no Torrens title in his own name involving said property.
disregarded.36
Simply put, for being a forged instrument, the Deed of REM is a nullity and conveys no
Such doctrine of mortgagee in good faith presupposes "that the mortgagor, who is not the title.42
rightful owner of the property, has already succeeded in obtaining a Torrens title over the
property in his name and that, after obtaining the said title, he succeeds in mortgaging the Second, Evelyn cannot invoke the protection given to a mortgagee in good faith. As
property to another who relies on what appears on the said title."37 In short, the doctrine of discussed, the title to the subject property remained registered in the name of Bernardo. It
mortgagee in good faith assumes that the title to the subject property had already was not transferred to the impostor's name when Evelyn transacted with the latter. Hence,
been transferred or registered in the name of the impostor who thereafter transacts with a the principle of mortgagee in good faith finds no application; correspondingly, Evelyn
mortgagee who acted in good faith. In the case at bench, it must be emphasized that the cannot not seek refuge therefrom.
title remained to be registered in the name of Bernardo, the rightful and real owner, and
not in the name of the impostor.
Third, even assuming that the impostor has caused the property to be titled in his name as
if he had rightful ownership thereof, Evelyn would still not be deemed a mortgagee in good
The burden of proof that one is a mortgagee in good faith and for value lies with the person faith. This is because Evelyn did not take the necessary steps to determine any defect in
who claims such status. A mortgagee cannot simply ignore facts that should have put a
the title of the alleged owner of the mortgaged property. She deliberately ignored pertinent
reasonable person on guard, and thereafter claim that he or she acted in good truth under facts that should have aroused suspicion on the veracity of the title of the mortgagor
the belief that the mortgagor's title is not defective. 38 And, such good faith entails an honest
"Bernardo."43
intention to refrain from taking unconscientious advantage of another. 39
One, while ''Bernardo" introduced himself to Evelyn as the owner of the property, he did
In other words, in order for a mortgagee to invoke the doctrine of mortgagee in good faith, not present any proof of identification. To recall, he only exhibited his community tax
the impostor must have succeeded in obtaining a Torrens title in his name and thereafter
certificate and a picture when he introduced himself to Evelyn. Bernardo's" failure to
in mortgaging the property. Where the mortgagor is an impostor who only pretended to be sufficiently establish his identity should have aroused suspicion on the part of Evelyn
the registered owner, and acting on such pretense, mortgaged the property to another, the
whether the person she was transacting with is the real Bernardo or a mere impostor. She
mortgagor evidently did not succeed in having the property titled in his or her name, and should have investigated further and verified the identity of "Bernardo" but she failed to do
the mortgagee cannot rely on such pretense as what appears on the title is not the so. She even admitted that she did not at all ask for any identification card from
impostor's name but that of the registered owner. 40 "Bernardo."
In this case, Evelyn insists that she is a mortgagee in good faith and for value. Thus, she Two, Evelyn also ignored the fact that "Bernardo" did not participate in the
has the burden to prove such claim and must provide necessary evidence to support the negotiations/transactions leading to the execution of the Deed of REM. Notably, no power
same. Unfortunately, Evelyn failed to discharge her burden. of attorney was given to Editha who supposedly transacted in behalf of Bernardo. Despite
"Bernardo's" presence during the ocular inspection of the property and execution of the
First, the Deed of REM was established to be a forged instrument. As aptly discussed by mortgage contract, it was Editha who transacted with Evelyn. As gathered from the
the CA, Bernardo did not and could not have executed it as he was abroad at the time of testimony of Corazon, after the execution of the deed, Evelyn handed the loan amount of
its execution, to wit: ChanRoblesVirtualawlibrary P300,000.00 to Editha, not to "Bernardo," and it was Editha who handed to Evelyn the
owner's copy of TCT No. T-361747.
Verily, Bernardo could not have affixed his signature on the said deed on January 26, 1998
for he left the Philippines on October 19, 1997, x x x and only returned to the Philippines Three, Evelyn likewise failed to ascertain the supposed title of "Bernardo" over the
on March 21, 1998. Not only that, his signature on his Seafarer's Identification and Record property. Evelyn admitted that during the ocular inspection, she remained in the vehicle.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
She did not inquire from the subject property's occupant or from the occupants of the G.R. No. 169890 March 12, 2007
surrounding properties if they knew "Bernardo" and whether or not he owned the subject
property. FELICIANO ESGUERRA, CANUTO ESGUERRA, JUSTA ESGUERRA, ANGEL
ESGUERRA, FIDELA ESGUERRA, CLARA ESGUERRA, and PEDRO
Notably, the RTC misapprehended certain facts when it held that Evelyn inspected the ESGUERRA, Petitioners,
property and met Jovannie during the inspection. By her own account, Evelyn clarified that vs.
she met Jovannie for the first time only when the latter visited her house to inform her that VIRGINIA TRINIDAD, PRIMITIVA TRINIDAD, and THE REGISTER OF DEEDS OF
an impostor mortgaged Bernardo's property to her. MEYCAUAYAN, BULACAN, Respondents.
Four, the Court observes that Evelyn hastily granted the loan and entered into the DECISION
mortgage contract. As also testified by Corazon, a day after the supposed ocular
inspection on the property, Evelyn and "Bernardo" executed the Deed of REM even
CARPIO MORALES, J.:
without Evelyn verifying the identity of the property's occupant as well as the right of the
mortgagor, if any, over the same. Indeed, where the mortgagee acted with haste in
granting the loan, without first determining the ownership of the property being mortgaged, Involved in the present controversy are two parcels of land located in Camalig,
the mortgagee cannot be considered as an innocent mortgagee in good faith. 44 Meycauayan, Bulacan.
Thus, considering that the mortgage contract was forged as it was entered into by Evelyn Felipe Esguerra and Praxedes de Vera (Esguerra spouses) were the owners of several
with an impostor, the registered owner of the property, Bernardo, correspondingly did not parcels of land in Camalig, Meycauayan, Bulacan among them a 35,284-square meter
lose his title thereon, and Evelyn did not acquire any right or title on the property and parcel of land covered by Tax Declaration No. 10374, half of which (17,642 square meters)
cannot invoke that she is a mortgagee in good faith and for value. 45 they sold to their grandchildren, herein petitioners Feliciano, Canuto, Justa, Angel, Fidela,
Clara and Pedro, all surnamed Esguerra; and a 23,989-square meter
WHEREFORE, the Petition is DENIED. Accordingly, the October 22, 2012 Decision of the
Court of Appeals in CA-G.R. CV No. 95046 is AFFIRMED. parcel of land covered by Tax Declaration No. 12080, 23,489 square meters of which they
also sold to petitioners, and the remaining 500 square meters they sold to their other
grandchildren, the brothers Eulalio and Julian Trinidad (Trinidad brothers).
SO ORDERED.
Also sold to the Trinidad brothers were a 7,048-square meter parcel of land covered by
Tax Declaration No. 9059, a 4,618-square meter parcel of land covered by Tax Declaration
No. 12081, and a 768-square meter parcel of land covered by Tax Declaration No. 13989.
The Esguerra spouses executed the necessary Deed of Sale in favor of petitioners on
August 11, 1937,1 and that in favor of the Trinidad brothers on August 17, 1937. 2 Both
documents were executed before notary public Maximo Abao.
Eulalio Trinidad later sold his share of the land to his daughters-respondents herein, via a
notarized Kasulatan ng Bilihang Tuluyan ng Lupa3 dated October 13, 1965. A portion of
the land consisting of 1,693 square meters was later assigned Lot No. 3593 during a
cadastral survey conducted in the late 1960s.
On respondents application for registration of title, the then Court of First Instance (CFI) of
Bulacan, by Decision4of February 20, 1967, awarded Lot No. 3593 in their favor in Land
Registration Case No. N-323-V. Pursuant to the Decision, the Land Registration
Commission (LRC, now the Land Registration Authority [LRA]) issued Decree No. N-
114039 by virtue of which the Register of Deeds of Bulacan issued OCT No. 0-36315 in the
name of respondents.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Meanwhile, under a notarized Bilihan ng Lupa6 dated November 10, 1958, petitioners sold In their Comment, respondents assailed the petition as lacking verification and certification
to respondents parents Eulalio Trinidad and Damiana Rodeadilla (Trinidad spouses) a against forum shopping and failing to attach to it an affidavit of service and material
portion of about 5,000 square meters of the 23,489-square meter of land which they portions of the record in support thereof. Petitioners counter that the procedural
previously acquired from the Esguerra spouses. 7 deficiencies have been mooted by the filing of a Compliance.
During the same cadastral survey conducted in the late 1960s, it was discovered that the A check of the rollo shows that attached to the petition are an Affidavit of Service dated
about 5,000-square meter portion of petitioners parcel of land sold to the Trinidad spouses November 21, 2005 and the appellate courts Decision of February 28, 2005 and
which was assigned Lot No. 3591 actually measured 6,268 square meters. Resolution of October 3, 2005; and that on January 16, 2006 or almost three months
following the last day to file the petition, petitioners submitted, not at their own instance, 13 a
In a subsequent application for registration of title over Lot No. 3591, docketed as Land Verification and Sworn Certification on Non-Forum Shopping signed by petitioner Pedro
Registration Case No. N-335-V, the CFI, by Decision8 of August 21, 1972, awarded Lot Esguerra who cited honest and excusable mistake behind the omission to submit the
No. 3591 in favor of Eulalio Trinidad. Pursuant to the Decision, the LRC issued Decree No. same.
N-149491 by virtue of which the Register of Deeds of Bulacan issued OCT No. 0-64989 in
the name of Trinidad. This Court has strictly enforced the requirement of verification and certification, obedience
to which and to other procedural rules is needed if fair results are to be expected
Upon the death of the Trinidad spouses, Lot No. 3591 covered by OCT No. 0-6498 was therefrom.14 While exceptional cases have been considered to correct patent injustice
transmitted to respondents by succession. concomitant to a liberal application of the rules of procedure, there should be an effort on
the part of the party invoking liberality to advance a reasonable or meritorious explanation
for his failure to comply with the rules. 15 In petitioners case, no such explanation has been
Petitioners, alleging that upon verification with the LRA they discovered the issuance of the advanced.
above-stated two OCTs, filed on August 29, 1994 before the Regional Trial Court (RTC) of
Malolos, Bulacan two separate complaints for their nullification on the ground that they
were procured through fraud or misrepresentation. With regard to petitioners failure to attach material portions of the record in support of the
petition, this requirement is not a mere technicality but an essential requisite for the
determination of prima facie basis for giving due course to the petition. 16 As a rule, a
In the first complaint, docketed as Civil Case No. 737-M-94, petitioners sought the petition which lacks copies of essential pleadings and portions of the case record may be
cancellation of OCT No. 0-3631. dismissed. Much discretion is left to the reviewing court, however, to determine the
necessity for such copies as the exact nature of the pleadings and portions of the case
In the other complaint, docketed as Civil Case No. 738-M-94, petitioners sought the record which must accompany a petition is not specified. 17
cancellation of OCT No. 0-6498.
At all events, technicality aside, the petition must be denied.
Both cases were consolidated and tried before Branch 79 of the RTC which, after trial,
dismissed the cases by Joint Decision10 of May 15, 1997. It is settled that fraud is a question of fact and the circumstances constituting the same
must be alleged and proved in the court below.18
Their appeal with the Court of Appeals having been dismissed by Decision of February 28,
2005, a reconsideration of which was, by Resolution of October 3, 2005,11 denied, In the present cases, as did the trial court, the appellate court found no fraud in
petitioners filed the instant petition. respondents acquisition and registration of the land, viz:
Petitioners fault the appellate court . . . Appellant Pedro Esguerra even testified that he does not know how appellees were
able to secure a title over the lot in question and that they never sold Lot No. 3593 to
1. . . . in misappreciating the fact that the act of the respondent Eulalio Trinidad in Virginia Trinidad since it is part of the whole lot of 23,489 square meters. The said
acquiring the property from Felipe Esguerra constituted fraud. testimony is a mere conclusion on the part of appellants. On the other hand, the evidence
shows that appellees acquired title over the subject property by virtue of a deed of sale
executed by their father Eulalio Trinidad in their favor.
2. . . . in the [i]nterpretation and application of the provisions of Article 1542 of the
New Civil Code.
xxxx
3. . . . in ruling that there is prescription, res judicata, and violation of the non-
[forum] shopping.12
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
[T]hey failed to establish that appellees acquisition of the certificate of title is fraudulent. In . . . In a unit price contract, the statement of area of immovable is not conclusive and the
fact, in their two complaints, appellants acknowledged that appellees observed and took price may be reduced or increased depending on the area actually delivered. If the vendor
the initial procedural steps in the registration of the land, thus ruling out fraud in the delivers less than the area agreed upon, the vendee may oblige the vendor to deliver all
acquisition of the certificate of title. . . .19 that may be stated in the contract or demand for the proportionate reduction of the
purchase price if delivery is not possible. If the vendor delivers more than the area stated
Factual findings of the trial court, when affirmed by the Court of Appeals, are final, in the contract, the vendee has the option to accept only the amount agreed upon or to
conclusive and binding on this Court, 20 which is not a trier of facts,21 hence, bereft of accept the whole area, provided he pays for the additional area at the contract rate.
function under Rule 45 to examine and weigh the probative value of the evidence
presented,22 its jurisdiction being limited only to the review and revision of errors of xxxx
law.23 Albeit there are exceptions24 to this rule, the cases at bar do not fall thereunder,
there being no showing that the trial and appellate courts overlooked matters which, if In the case where the area of the immovable is stated in the contract based on an
considered, would alter their outcome. estimate, the actual area delivered may not measure up exactly with the area stated in the
contract. According to Article 1542 of the Civil Code, in the sale of real estate, made for a
Under the Torrens System, an OCT enjoys a presumption of validity, which correlatively lump sum and not at the rate of a certain sum for a unit of measure or number, there shall
carries a strong presumption that the provisions of the law governing the registration of be no increase or decrease of the price, although there be a greater or less areas or
land which led to its issuance have been duly followed. 25 Fraud being a serious charge, it number than that stated in the contract. . . .
must be supported by clear and convincing proof. 26 Petitioners failed to discharge the
burden of proof, however. xxxx
On the questioned interpretation and application by the appellate court of Article 1542 of Where both the area and the boundaries of the immovable are declared, the area covered
the Civil Code reading: within the boundaries of the immovable prevails over the stated area. In cases of conflict
between areas and boundaries, it is the latter which should prevail. What really defines a
In the sale of real estate, made for a lump sum and not at the rate of a certain sum for a piece of ground is not the area, calculated with more or less certainty, mentioned in its
unit of measure or number, there shall be no increase or decrease of the price, although description, but the boundaries therein laid down, as enclosing the land and indicating its
there be a greater or less areas or number than that stated in the contract. limits. In a contract of sale of land in a mass, it is well established that the specific
boundaries stated in the contract must control over any statement with respect to the area
The same rule shall be applied when two or more immovables are sold for a single price; contained within its boundaries. It is not of vital consequence that a deed or contract of
but if, besides mentioning the boundaries, which is indispensable in every conveyance of sale of land should disclose the area with mathematical accuracy. It is sufficient if its extent
real estate, its area or number should be designated in the contract, the vendor shall be is objectively indicated with sufficient precision to enable one to identify it. An error as to
bound to deliver all that is included within said boundaries, even when it exceeds the area the superficial area is immaterial. Thus, the obligation of the vendor is to deliver everything
within the boundaries, inasmuch as it is the entirety thereof that distinguishes the
or number specified in the contract; and, should he not be able to do so, he shall suffer a
reduction in the price, in proportion to what is lacking in the area or number, unless the determinate object.28 (Emphasis and underscoring supplied)
contract is rescinded because the vendee does not accede to the failure to deliver what
has been stipulated. (Emphasis and underscoring supplied), The courts below correctly characterized the sale of Lot No. 3591 as one involving a lump
sum contract. The Bilihan ng Lupa shows that the parties agreed on the purchase price of
while petitioners admittedly sold Lot No. 3591 to the Trinidad spouses, they contend that 1,000.00 on a predetermined, albeit unsurveyed, area of 5,000 square meters and not on
a particular rate per unit area. As noted by the Court of Appeals, the identity of the realty
what they sold were only 5,000 square meters and not 6,268 square meters, and thus
claim the excess of 1,268 square meters. was sufficiently described as riceland:
In sales involving real estate, the parties may choose between two types of pricing It is clear from the afore-quoted Bilihan ng Lupa that what appellants sold to Eulalio was
the "bahaging palayan." Though measured as 5,000 square meters, more or less, such
agreement: a unit price contract wherein the purchase price is determined by way of
reference to a stated rate per unit area (e.g., 1,000 per square meter), or a lump sum measurement is only an approximation, and not an exact measurement. Moreover, we
contract which states a full purchase price for an immovable the area of which may be take note of the fact that the said deed of sale mentioned the boundaries covering the
declared based on an estimate or where both the area and boundaries are stated (e.g., 1 whole area of 33,489 square meters, including the "bahaging palayan." Had appellants
million for 1,000 square meters, etc.). In Rudolf Lietz, Inc. v. Court of Appeals,27 the Court intended to sell only a portion of the "bahaging palayan," they could have stated the
discussed the distinction: specific area in the deed of sale and not the entire "bahaging palayan" . . . .29
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
In fine, under Article 1542, what is controlling is the entire land included within the Answer. Contrary to petitioners claim, however, the records reveal that respondents raised
boundaries, regardless of whether the real area should be greater or smaller than that their objection in their Amended Answers 37 filed in both cases.
recited in the deed. This is particularly true since the area of the land in OCT No. 0-6498
was described in the deed as "humigit kumulang," that is, more or less.30
IN FINE, it is a fundamental principle in land registration that a certificate of title serves as
evidence of an indefeasible and incontrovertible title to the property in favor of the person
A caveat is in order, however. The use of "more or less" or similar words in designating whose name appears therein. Such indefeasibility commences after the lapse or expiration
quantity covers only a reasonable excess or deficiency. A vendee of land sold in gross or of one year from the date of entry of the decree of registration when all persons are
with the description "more or less" with reference to its area does not thereby ipso considered to have a constructive notice of the title to the property. After the lapse of one
facto take all risk of quantity in the land.31 year, therefore, title to the property can no longer be contested. This system was so
effected in order to quiet title to land.38
Numerical data are not of course the sole gauge of unreasonableness of the excess or
deficiency in area. Courts must consider a host of other factors. In one case,32 the Court
found substantial discrepancy in area due to contemporaneous circumstances. Citing
change in the physical nature of the property, it was therein established that the excess
WHEREFORE, the petition is DENIED. The assailed Decision and Resolution of the Court
area at the southern portion was a product of reclamation, which explained why the lands of Appeals are AFFIRMED.
technical description in the deed of sale indicated the seashore as its southern boundary,
hence, the inclusion of the reclaimed area was declared unreasonable.
Costs against petitioners.
In OCT No. 0-6498, the increase by a fourth of a fraction of the area indicated in the deed
of sale cannot be considered as an unreasonable excess. Most importantly, the SO ORDERED.
circumstances attendant to the inclusion of the excess area bare nothing atypical or
significant to hint at unreasonableness. It must be noted that the land was not yet
technically surveyed at the time of the sale. As vendors who themselves executed
the Bilihan ng Lupa, petitioners may rightly be presumed to have acquired a good estimate
of the value and area of the bahaging palayan.
As for the last assigned error, the appellate court, in finding that the complaints were time-
barred, noted that when the complaints were filed in 1994, more than 27 years had
elapsed from the issuance of OCT No. 0-3631 and more than 20 years from the issuance
of OCT No. 0-6498. The prescriptive period of one (1) year had thus set in.1awphi1.nt
A word on Republic Act No. 716034 which was raised by petitioners in their petition. It
expressly requires the parties to undergo a conciliation process under the Katarungang
Pambarangay, as a precondition to filing a complaint in court, 35 non-compliance with this
condition precedent does not prevent a court of competent jurisdiction from exercising its
power of adjudication over a case unless the defendants object thereto. The objection
should be seasonably made before the court first taking cognizance of the complaint, and
must be raised in the Answer or in such other pleading allowed under the Rules of Court. 36
While petitioners admittedly failed to comply with the requirement of barangay conciliation,
they assert that respondents waived such objection when they failed to raise it in their
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
G.R. No. 148225 March 3, 2010 South : Lot 11858 & 11912
CARMEN DEL PRADO, Petitioner, containing an area of 4,000 square meters, more or less, covered by Tax Dec. No. 00787
vs. of the Cebu City Assessors Office, Cebu City." of which parcel of land we are the absolute
SPOUSES ANTONIO L. CABALLERO and LEONARDA CABALLERO, Respondents. and lawful owners.
DECISION Original Certificate of Title (OCT) No. 1305, covering Lot No. 11909, was issued only on
November 15, 1990, and entered in the "Registration Book" of the City of Cebu on
NACHURA, J.: December 19, 1990.5 Therein, the technical description of Lot No. 11909 states that said
lot measures about 14,457 square meters, more or less.6
This is a petition for review on certiorari of the decision 1 of the Court of Appeals (CA) dated
September 26, 2000 and its resolution denying the motion for reconsideration thereof. On March 20, 1991, petitioner filed in the same cadastral proceedings a "Petition for
Registration of Document Under Presidential Decree (P.D.) 1529" 7 in order that a
certificate of title be issued in her name, covering the whole Lot No. 11909. In the petition,
The facts are as follows: petitioner alleged that the tenor of the instrument of sale indicated that the sale was for a
lump sum or cuerpo cierto, in which case, the vendor was bound to deliver all that was
In a judgment rendered on February 1, 1985 in Cadastral Case No. N-6 (LRC Rec. No. N- included within said boundaries even when it exceeded the area specified in the contract.
611), Judge Juan Y. Reyes of the Regional Trial Court (RTC) of Cebu City, Branch 14, Respondents opposed, on the main ground that only 4,000 sq m of Lot No. 11909 was
adjudicated in favor of Spouses Antonio L. Caballero and Leonarda B. Caballero several sold to petitioner. They claimed that the sale was not for a cuerpo cierto. They moved for
parcels of land situated in Guba, Cebu City, one of which was Cadastral Lot No. 11909, the outright dismissal of the petition on grounds of prescription and lack of jurisdiction.
the subject of this controversy.2 On May 21, 1987, Antonio Caballero moved for the
issuance of the final decree of registration for their lots. 3 Consequently, on May 25, 1987, After trial on the merits, the court found that petitioner had established a clear and positive
the same court, through then Presiding Judge Renato C. Dacudao, ordered the National right to Lot No. 11909. The intended sale between the parties was for a lump sum, since
Land Titles and Deeds Registration Administration to issue the decree of registration and there was no evidence presented that the property was sold for a price per unit. It was
the corresponding titles of the lots in favor of the Caballeros.4 apparent that the subject matter of the sale was the parcel of land, known as Cadastral Lot
No. 11909, and not only a portion thereof.8
On June 11, 1990, respondents sold to petitioner, Carmen del Prado, Lot No. 11909 on the
basis of the tax declaration covering the property. The pertinent portion of the deed of sale Thus, on August 2, 1993, the court a quo rendered its decision with the following
reads as follows: dispositive portion:
That we, Spouses ANTONIO L. CABALLERO and LEONARDA B. CABALLERO, Filipinos, WHEREFORE, premises considered, the petition is hereby granted and judgment is
both of legal age and residents of Talamban, Cebu City, Philippines, for and in hereby rendered in favor of herein petitioner. The Register of Deeds of the City of Cebu is
consideration of the sum of FORTY THOUSAND PESOS (40,000.00), Philippine hereby ordered and directed to effect the registration in his office of the Deed of Absolute
Currency, paid by CARMEN DEL PRADO, Filipino, of legal age, single and a resident of Sale between Spouses Antonio Caballero and Leonarda Caballero and Petitioner, Carmen
Sikatuna St., Cebu City, Philippines, the receipt of which is full is hereby acknowledged, do del Prado dated June 11, 1990 covering Lot No. 11909 after payment of all fees prescribed
by these presents SELL, CEDE, TRANSFER, ASSIGN & CONVEY unto the said by law. Additionally, the Register of Deeds of the City of Cebu is hereby ordered to cancel
CARMEN DEL PRADO, her heirs, assigns and/or successors-in-interest, one (1) Original Certificate No. 1305 in the name of Antonio Caballero and Leonarda Caballero
unregistered parcel of land, situated at Guba, Cebu City, Philippines, and more particularly and the Transfer Certificate of Title be issued in the name of Petitioner Carmen del Prado
described and bounded, as follows: covering the entire parcel of land known as Cadastral Lot No. 11909.9
"A parcel of land known as Cad. Lot No. 11909, bounded as follows: An appeal was duly filed. On September 26, 2000, the CA promulgated the assailed
decision, reversing and setting aside the decision of the RTC.
North : Lot 11903
The CA no longer touched on the character of the sale, because it found that petitioner
East : Lot 11908 availed herself of an improper remedy. The "petition for registration of document" is not
one of the remedies provided under P.D. No. 1529, after the original registration has been
effected. Thus, the CA ruled that the lower court committed an error when it assumed
West : Lot 11910
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
jurisdiction over the petition, which prayed for a remedy not sanctioned under the Property "In a unit price contract, the statement of area of immovable is not conclusive and the
Registration Decree. Accordingly, the CA disposed, as follows: price may be reduced or increased depending on the area actually delivered. If the vendor
delivers less than the area agreed upon, the vendee may oblige the vendor to deliver all
that may be stated in the contract or demand for the proportionate reduction of the
IN VIEW OF ALL THE FOREGOING, the appealed decision is REVERSED and SET
ASIDE and a new one entered dismissing the petition for lack of jurisdiction. No purchase price if delivery is not possible. If the vendor delivers more than the area stated
pronouncement as to costs.10 in the contract, the vendee has the option to accept only the amount agreed upon or to
accept the whole area, provided he pays for the additional area at the contract rate.
Aggrieved, petitioner filed the instant petition, raising the following issues:
xxxx
III. WHETHER OR NOT THE COURT A QUO HAS JURISDICTION OVER THE PETITION xxxx
FOR REGISTRATION OF THE DEED OF ABSOLUTE SALE DATED 11 JUNE 1990
EXECUTED BETWEEN HEREIN PETITIONER AND RESPONDENTS[.]11
Where both the area and the boundaries of the immovable are declared, the area covered
within the boundaries of the immovable prevails over the stated area. In cases of conflict
The core issue in this case is whether or not the sale of the land was for a lump sum or between areas and boundaries, it is the latter which should prevail. What really defines a
not. piece of ground is not the area, calculated with more or less certainty, mentioned in its
description, but the boundaries therein laid down, as enclosing the land and indicating its
Petitioner asserts that the plain language of the Deed of Sale shows that it is a sale of a limits. In a contract of sale of land in a mass, it is well established that the specific
real estate for a lump sum, governed under Article 1542 of the Civil Code. 12 In the contract, boundaries stated in the contract must control over any statement with respect to the area
it was stated that the land contains an area of 4,000 sq m more or less, bounded on the contained within its boundaries. It is not of vital consequence that a deed or contract of
North by Lot No. 11903, on the East by Lot No. 11908, on the South by Lot Nos. 11858 & sale of land should disclose the area with mathematical accuracy. It is sufficient if its extent
11912, and on the West by Lot No. 11910. When the OCT was issued, the area of Lot No. is objectively indicated with sufficient precision to enable one to identify it. An error as to
11909 was declared to be 14,475 sq m, with an excess of 10,475 sq m. In accordance with the superficial area is immaterial. Thus, the obligation of the vendor is to deliver everything
Article 1542, respondents are, therefore, duty-bound to deliver the whole area within the within the boundaries, inasmuch as it is the entirety thereof that distinguishes the
boundaries stated, without any corresponding increase in the price. Thus, petitioner determinate object.14
concludes that she is entitled to have the certificate of title, covering the whole Lot No.
11909, which was originally issued in the names of respondents, transferred to her name. The Court, however, clarified that the rule laid down in Article 1542 is not hard and fast and
admits of an exception. It held:
We do not agree.
A caveat is in order, however. The use of "more or less" or similar words in designating
In Esguerra v. Trinidad,13 the Court had occasion to discuss the matter of sales involving quantity covers only a reasonable excess or deficiency. A vendee of land sold in gross or
real estates. The Courts pronouncement is quite instructive: with the description "more or less" with reference to its area does not thereby ipso facto
take all risk of quantity in the land..
In sales involving real estate, the parties may choose between two types of pricing
agreement: a unit price contract wherein the purchase price is determined by way of Numerical data are not of course the sole gauge of unreasonableness of the excess or
reference to a stated rate per unit area (e.g., 1,000 per square meter), or a lump sum deficiency in area. Courts must consider a host of other factors. In one case (see Roble v.
contract which states a full purchase price for an immovable the area of which may be Arbasa, 414 Phil. 343 [2001]), the Court found substantial discrepancy in area due to
declared based on the estimate or where both the area and boundaries are stated (e.g., contemporaneous circumstances. Citing change in the physical nature of the property, it
1 million for 1,000 square meters, etc.). In Rudolf Lietz, Inc. v. Court of Appeals (478 was therein established that the excess area at the southern portion was a product of
SCRA 451), the Court discussed the distinction: reclamation, which explained why the lands technical description in the deed of sale
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
indicated the seashore as its southern boundary, hence, the inclusion of the reclaimed WHEREFORE, the petition is DENIED.
area was declared unreasonable.15
SO ORDERED.
In the instant case, the deed of sale is not one of a unit price contract. The parties agreed
on the purchase price of 40,000.00 for a predetermined area of 4,000 sq m, more or less, G.R. No. 170540
bounded on the North by Lot No. 11903, on the East by Lot No. 11908, on the South by
Lot Nos. 11858 & 11912, and on the West by Lot No. 11910. In a contract of sale of land in
a mass, the specific boundaries stated in the contract must control over any other Present:
statement, with respect to the area contained within its boundaries. 161avvphi1
QUISUMBING,** J.,
Blacks Law Dictionary17 defines the phrase "more or less" to mean:
CARPIO, J., Chairperson,
About; substantially; or approximately; implying that both parties assume the risk of any
ordinary discrepancy. The words are intended to cover slight or unimportant inaccuracies CHICO-NAZARIO,
in quantity, Carter v. Finch, 186 Ark. 954, 57 S.W.2d 408; and are ordinarily to be EUFEMIA BALATICO VDA.
interpreted as taking care of unsubstantial differences or differences of small importance DE AGATEP,
compared to the whole number of items transferred. Petitioner, PERALTA, and
ABAD,*** JJ.
Clearly, the discrepancy of 10,475 sq m cannot be considered a slight difference in
quantity. The difference in the area is obviously sizeable and too substantial to be - versus -
overlooked. It is not a reasonable excess or deficiency that should be deemed included in
the deed of sale.
Promulgated:
ROBERTA* L.
We take exception to the avowed rule that this Court is not a trier of facts. After an RODRIGUEZ and NATALIA
October 28, 2009
assiduous scrutiny of the records, we lend credence to respondents claim that they AGUINALDO VDA. DE
intended to sell only 4,000 sq m of the whole Lot No. 11909, contrary to the findings of the LIM,
lower court. The records reveal that when the parties made an ocular inspection, petitioner Respondents.
specifically pointed to that portion of the lot, which she preferred to purchase, since there x---------------------------------------------------x
were mango trees planted and a deep well thereon. After the sale, respondents delivered
and segregated the area of 4,000 sq m in favor of petitioner by fencing off the area of
10,475 sq m belonging to them.18
DECISION
Contracts are the law between the contracting parties. Sale, by its very nature, is a
consensual contract, because it is perfected by mere consent. The essential elements of a
contract of sale are the following: (a) consent or meeting of the minds, that is, consent to
transfer ownership in exchange for the price; (b) determinate subject matter; and (c) price
certain in money or its equivalent. All these elements are present in the instant case. 19 PERALTA, J.
More importantly, we find no reversible error in the decision of the CA. Petitioners
recourse, by filing the petition for registration in the same cadastral case, was improper. It
is a fundamental principle in land registration that a certificate of title serves as evidence of
an indefeasible and incontrovertible title to the property in favor of the person whose name
appears therein. Such indefeasibility commences after one year from the date of entry of Before the Court is a petition for review on certiorari under Rule 45 of the Rules of Court
the decree of registration.20 Inasmuch as the petition for registration of document did not
interrupt the running of the period to file the appropriate petition for review and considering seeking the reversal and setting aside of the Decision [1] of the Court of Appeals (CA) dated
that the prescribed one-year period had long since expired, the decree of registration, as
well as the certificate of title issued in favor of respondents, had become incontrovertible. 21 September 9, 2005 in CA-G.R. CV No. 83163which affirmed the May 12, 2004 Decision of
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
the Regional Trial Court (RTC) of Aparri, Cagayan, Branch 8, in Civil Case No. 08-298. with barbed wire and introduced improvements thereon. Subsequently, Agatep died in
Petitioner also assails the CA Resolution[2] dated November 16, 2005 denying her motion 1978. Despite his death, his heirs, including herein petitioner, continued to possess the
The factual and procedural antecedents of the case are as follows: In July 1992, the subject lot was included among PNB's acquired assets for sale. Later on,
an invitation to bid was duly published. On April 20, 1993, the disputed parcel of land was
The present case arose from a dispute involving a parcel of land located at Zinundungan, sold to herein respondent Roberta L. Rodriguez (Rodriguez), who is the daughter of
Lasam, Cagayan with an area of 1,377 square meters and covered by Transfer Certificate respondent Lim.[8] Subsequently, TCT No. T-65894, in the name of PNB, was canceled
of Title (TCT) No. T-10759 of the Register of Deeds of the Province of Cagayan.[3] and a new title (TCT No. T-89400) was issued in the name of Rodriguez. [9]
On January 27, 1995, herein petitioner filed a Complaint [10] for reconveyance and/or
The subject property was previously owned by herein respondent Natalia Aguinaldo Vda.
damages with the RTC of Aparri, Cagayan against herein respondents.
de Lim. On July 18, 1975, Lim mortgaged the lot to the Philippine National Bank (PNB),
Tuguegarao Branch, to secure a loan of P30,000.00 which she obtained from the said
Later, the complaint was amended to implead PNB as a party-defendant.[11]
bank. The mortgage contract was duly annotated on TCT No. T-10759. Lim was not able
to pay her loan prompting PNB to foreclose the property. On April 13, 1983, the subject
On January 20, 2000, the RTC dismissed the amended complaint for failure of herein
parcel of land was sold at public auction to PNB as the highest bidder. [4] Lim failed to
petitioner (then plaintiff) to file her Pre-Trial Brief.[12] Petitioner filed a motion for
redeem the property. After the expiration of the one-year redemption period allowed by
reconsideration but the RTC denied it. Thereafter, trial ensued.
law, PNB consolidated its ownership over the disputed land. [5] As a consequence, TCT No.
T-10759 in the name of Lim was canceled and a new certificate of title (TCT No. T-65894)
On May 12, 2004, the RTC rendered judgment in favor of herein respondents. [13] The
was issued in the name of PNB on November 8, 1985.[6]
dispositive portion of the Decision reads as follows:
at the expense of petitioner and her husband by benefiting from the proceeds of the sale
IV.3. AS A NECESSARY CONSEQUENCE OF THE ERROR IV.2, THE
but failing to deliver the object of such sale. Hence, on grounds of justice and equity, RULING OF THE APPELLATE COURT THAT PNB IS A
MORTGAGEE, BUYER AND LATER SELLER IN GOOD FAITH, IS A
petitioner should be awarded an adequate compensation for the value of the loss suffered. REVERSIBLE ERROR;
On September 9, 2005, the CA rendered its Decision dismissing herein petitioner's appeal In her first assigned error, petitioner contends that Section 6, Rule 18 of the Rules of Court
for lack of merit and affirming the assailed Decision of the RTC. does not require another pre-trial, as well as the filing of another pre-trial brief, when the
Petitioner filed a motion for reconsideration, but the CA denied it in its Resolution
In Tiu v. Middleton,[17] the Court, giving emphasis on the importance of a pre-trial, held that:
Hence, the present petition with the following assignment of errors:
Pre-trial is an answer to the clarion call for the speedy disposition of
cases. Although it was discretionary under the 1940 Rules of Court, it
IV.1. IN AFFIRMING THE DECISION OF THE TRIAL COURT IN
was made mandatory under the 1964 Rules and the subsequent
DISMISSING THE AMENDED COMPLAINT AGAINST THE PNB, THE
amendments in 1997. Hailed as the most important procedural
APPELLATE COURT COMMITTED A REVERSIBLE ERROR;
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Land Titles and Deeds (Finals) 2017
innovation in Anglo-Saxon justice in the nineteenth century, pre-trial (d) The documents or exhibits to be presented,
seeks to achieve the following: stating the purpose thereof;
(a) The possibility of an amicable settlement or of a (e) A manifestation of their having availed, or their
submission to alternative modes of dispute intention to avail, themselves of discovery
resolution; procedures or referral to commissioners; and
(b) The simplification of the issues; (f) The number and names of the witnesses, and the
(c) The necessity or desirability of amendments to substance of their respective testimonies.
the pleadings;
Failure to file the pre-trial brief shall have the same effect as failure to
(d) The possibility of obtaining stipulations or appear at the pre-trial.
admissions of facts and of documents to avoid
unnecessary proof;
(e) The limitation of the number of witnesses;
(f) The advisability of a preliminary reference of The pre-trial brief serves as a guide during the pre-trial conference so as to simplify,
issues to a commissioner;
abbreviate and expedite the trial if not to dispense with it. It is a devise essential to the
(g) The propriety of rendering judgment on the
pleadings, or summary judgment, or of dismissing speedy disposition of disputes, and parties cannot brush it aside as a mere
the action should a valid ground therefor be found to
exist; technicality.[19] In addition, pre-trial rules are not to be belittled or dismissed, because their
(h) The advisability or necessity of suspending the non-observance may result in prejudice to a partys substantive rights. Like all rules, they
proceedings; and
(i) Such other matters as may aid in the prompt should be followed except only for the most persuasive of reasons when they may be
disposition of the action.[18]
relaxed to relieve a litigant of an injustice not commensurate with the degree of his
amended, provides: Petitioner posits that even if an amended complaint is filed for the purpose of impleading
another party as defendant, where no additional cause of action was alleged and the
SEC. 6. Pre-trial brief. The parties shall file with the court and serve on
the adverse party, in such manner as shall ensure their receipt thereof amount of prayer for damages in the original complaint was the same, another pre-trial is
at least three (3) days before the date of the pre-trial, their respective
pre-trial briefs which shall contain, among others: not required and a second pre-trial brief need not be filed.
(c) The issues to be tried or resolved; repleaded all the pleadings of the original defendants. Petitioner's reliance on the above-
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Land Titles and Deeds (Finals) 2017
cited cases is misplaced because, in the present case, the RTC correctly found that trial court.[23] Considering the circumstances established on record in the instant case, the
petitioner had a separate cause of action against PNB. A separate cause of action Court finds no cogent reason to set aside the order of the RTC dismissing the complaint of
necessarily means additional cause of action. Moreover, the defenses adopted by PNB are petitioner against PNB.
completely different from the defenses of Lim and Rodriguez, necessitating a separate
determination of the matters enumerated under Section 6, Rule 18 of the Rules of Court With respect to the second and third assignment of errors, petitioner argues that the CA
insofar as PNB and petitioner are concerned. On these bases, we find no error in the ruling erred in sustaining the RTC when it passed upon the merits of petitioner's cause of action
of the CA which sustained the trial court's dismissal of the amended complaint against against PNB notwithstanding the fact that the complaint against the latter was already
PNB for failure of petitioner to file her pre-trial brief. dismissed. Petitioner contends that a person who was not impleaded in a case could not
be bound by the decision rendered therein. Petitioner then proceeds to conclude that the
Corollarily, Sections 4 and 5 of the same Rule state: CA erred in sustaining the trial court's finding that PNB was a mortgagee, buyer and seller
in good faith.
Sec. 4. Appearance of parties. It shall be the duty of the parties and
their counsel to appear at the pre-trial. The non-appearance of a party
may be excused only if a valid cause is shown therefor or if a
representative shall appear in his behalf fully authorized in writing to The Court is not persuaded.
enter into an amicable settlement, to submit to alternative modes of
dispute resolution, and to enter into stipulations or admissions of facts
and of documents.
It is true that the judgment of the trial and appellate courts in the present case could not
Sec. 5. Effect of failure to appear. The failure of the plaintiff to appear
when so required pursuant to the next preceding section shall be cause bind the PNB for the latter is not a party to the case. However, this does not mean that the
for dismissal of the action. The dismissal shall be with prejudice, unless
otherwise ordered by the court. x x x trial and appellate courts are precluded from making findings which are necessary for a
just, complete and proper resolution of the issues raised in the present case. The Court
In the present case, the Court observes that in the Order of the RTC dated June 6, finds no error in the determination by the trial and appellate courts of the question of
2000,[22] the trial court noted the absence of both the petitioner and her counsel during the whether or not PNB was a mortgagee, buyer and, later on, seller in good faith as this
scheduled pre-trial conference with respect to the amended complaint impleading PNB. would bear upon the ultimate issue of whether petitioner is entitled to reconveyance.
Under the above-quoted Rules, such absence is an additional ground to dismiss the action
against PNB. Petitioner insists that PNB is not a mortgagee in good faith asserting that, if it only
exercised due diligence, it would have found out that petitioner and her husband were
Whether an order of dismissal should be maintained under the circumstances of a already in adverse possession of the subject property as early as two years before the
particular case or whether it should be set aside depends on the sound discretion of the same was sold to them. This claim, however, is contradicted by no less than petitioner's
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Land Titles and Deeds (Finals) 2017
averments in her Brief filed with the CA wherein she stated that [i]mmediately after the
sale, the land was delivered to Isaac Agatep x x x Since that time up to the present, Isaac The Court finds petitioner's arguments untenable.
Agatep and after his death, the Appellant have been in continuous, uninterrupted, adverse
and public possession of the said parcel of land. [24] The foregoing assertion only shows that The Court's ruling in Manuel R. Dulay Enterprises, Inc. v. Court of Appeals [26] is instructive,
petitioner's husband took possession of the subject lot only after the same was sold to him. to wit:
the titles thereto were in the latter's name, and they showed neither vice nor infirmity. In Paragraph 1, Article 1498 of the New Civil Code provides:
accepting the mortgage, PNB was not required to make any further investigation of the When the sale is made through a public instrument, the
execution thereof shall be equivalent to the delivery
titles to the properties being given as security, and could rely entirely on what was stated in of the thing which is the object of the contract, if
from the deed the contrary does not appear or
the aforesaid title. The public interest in upholding the indefeasibility of a certificate of title,
cannot clearly be inferred.
as evidence of the lawful ownership of the land or of any encumbrance thereon, protects a
Under the aforementioned article, the mere execution of the deed of
buyer or mortgagee who, in good faith, relies upon what appears on the face of the sale in a public document is equivalent to the delivery of the property.
Likewise, this Court had held that:
certificate of title.[25]
It is settled that the buyer in a foreclosure
sale becomes the absolute owner of the
property purchased if it is not redeemed during the
period of one year after the registration of the sale.
As such, he is entitled to the possession of the said
In her fourth assigned error, petitioner contends that PNB did not acquire ownership over
property and can demand it at any time following the
the disputed lot because the said property was not delivered to it. Petitioner asserts that consolidation of ownership in his name and the
issuance to him of a new transfer certificate of title.
the execution of a public document does not constitute sufficient delivery to PNB, The buyer can, in fact, demand possession of the
land even during the redemption period except that
considering that the subject property is in the adverse possession, under claim of he has to post a bond in accordance with Section 7
of Act No. 3133, as amended. No such bond is
ownership, of petitioner and her predecessor-in-interest. Petitioner further assails the ruling required after the redemption period if the property
is not redeemed. Possession of the land then
of the CA that PNB, who was the buyer in the foreclosure sale, became the absolute becomes an absolute right of the purchaser as
confirmed owner.
owner of the property purchased when it consolidated its ownership thereof for failure of
Therefore, prior physical delivery or possession is not legally required
the mortgagor Lim to redeem the subject property during the period of one year after the since the execution of the Deed of Sale is deemed equivalent to
delivery.[27]
registration of the sale.
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Land Titles and Deeds (Finals) 2017
by the latter. Their possession of the disputed lot could not, therefore, be considered as a
This ruling was reiterated in Spouses Sabio v. The International Corporate Bank, legal impediment which could prevent PNB from acquiring ownership and possession
rem - a lien on the property whoever its owner may be. It subsists notwithstanding a
Thus, the execution of the Deed of Sale in favor of PNB, after the expiration of the
change in ownership; in short, the personality of the owner is disregarded. Thus, all
redemption period, is deemed equivalent to delivery.
subsequent purchasers must respect the mortgage whether the transfer to them be with or
without the consent of the mortgagee, for such mortgage until discharged follows the
As to petitioner's contention that the execution of a public document in favor of PNB did not
property.[31]
constitute sufficient delivery to it because the property involved is in the actual and adverse
possession of petitioner and her husband, it must be noted that petitioner and her
Petitioner avers that she and her husband were not aware of the mortgage contract which
husband's possession of the disputed lot is derived from their right as buyers of the subject
was executed between PNB and Lim prior to the sale of the subject property by the latter
parcel of land. As buyers or transferees, petitioner and her husband simply stepped into
to her husband. The fact remains, however, that the mortgage was registered and
the shoes of Lim, who, prior to selling the subject property to them, mortgaged the same to
annotated on the certificate of title covering the subject property.
PNB. As Lim's successors-in-interest, their possession could not be said to be adverse to
that of Lim. Thus, they are also bound to recognize and respect the mortgage entered into
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Land Titles and Deeds (Finals) 2017
It is settled that registration in the public registry is notice to the whole world. [32] Every necessary implication are as much integral parts of the pre-trial order as those that are
conveyance, mortgage, lease, lien, attachment, order, judgment, instrument or entry expressly stipulated.[35] In the case before us, a cursory reading of the issues enumerated
affecting registered land shall, if registered, filed or entered in the Office of the Register of in the Pre-Trial Order of the RTC would readily show that the complete and proper
Deeds of the province or city where the land to which it relates lies, be constructive notice resolution of these issues would necessarily include all other matters pertinent to
to all persons from the time of such registering, filing or entering. [33] Under the rule of determining whether herein petitioner is the lawful owner of the subject property and is,
notice, it is presumed that the purchaser has examined every instrument of record therefore, entitled to reconveyance. It would be illogical not to touch on the question of
affecting the title. Such presumption may not be rebutted. He is charged with notice of whether the mortgage contract between Lim and PNB is binding on petitioner and her
every fact shown by the record and is presumed to know every fact shown by the record husband or whether PNB lawfully foreclosed and acquired ownership of the subject
and to know every fact which an examination of the record would have disclosed. This property because a resolution of these issues is determinative of whether there are no
presumption cannot be overcome by any claim of innocence or good faith. Otherwise, the impediments in petitioner and her husband's acquisition of ownership of the disputed lot.
very purpose and object of the law requiring a record would be destroyed. Such
presumption cannot be defeated by proof of want of knowledge of what the record contains Coming to the last assigned error, the Court agrees with the disquisition of the CA that an
any more than one may be permitted to show that he was ignorant of the provisions of the action for reconveyance is one that seeks to transfer property, wrongfully registered by
law. The rule that all persons must take notice of the facts which the public record contains another, to its rightful and legal owner. [36] From the foregoing discussions, the Court finds
is a rule of law. The rule must be absolute; any variation would lead to endless confusion no sufficient reason to depart from the findings of the RTC and the CA that, based on the
and useless litigation.[34] In the present case, since the mortgage contract was registered, evidence on record, there was no wrongful registration of the property, first in the name of
petitioner may not claim lack of knowledge thereof as a valid defense. The subsequent PNB as the purchaser when the property was auctioned and, subsequently, in the name of
sale of the property to petitioner's husband cannot defeat the rights of PNB as the respondent Rodriguez who bought the subject property when the same was offered for
mortgagee and, subsequently, the purchaser at the auction sale whose rights were derived sale by PNB. Hence, the CA did not commit error in affirming the RTC's dismissal of herein
In her fifth assignment of error, petitioner contends that the trial court deviated from the WHEREFORE, the petition is DENIED. The assailed Decision and Resolution of the Court
issues identified in the Pre-Trial Order and that the case was decided on issues different of Appeals, dated September 9, 2005 and November 16, 2005, respectively, in CA-G.R.
from those agreed upon during the pre-trial. Settled is the rule that a pre-trial order is not CV No. 83163 are AFFIRMED.
meant to be a detailed catalogue of each and every issue that is to be or may be taken up
during the trial. Issues that are impliedly included therein or may be inferable therefrom by SO ORDERED.
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Land Titles and Deeds (Finals) 2017
JOSEPH L. SY, NELSON GOLPEO and JOHN TAN, G.R. No. 154450
This is a petition for review on certiorari under Rule 45 of the Rules of Court of the
Petitioners,
Decision of the Court of Appeals (CA) dated July 23, 2002 in CA-G.R. CV No. 53314.
The case originated from an action for reconveyance of a large tract of land
- versus -
Present: in Caloocan City before the Regional Trial Court (RTC), Branch 129, Caloocan City,
entitled Nicolas Capistrano, Jr. v. Nenita F. Scott, Spouses Juanito and Josefina Jamilar,
NICOLAS CAPISTRANO, JR., substituted by JOSEFA B.
CAPISTRANO, REMEDIOS TERESITA B. CAPISTRANO and YNARES-SANTIAGO, J., Joseph L. Sy, Nelson Golpeo and John Tan, and the Register of
MARIO GREGORIO B. CAPISTRANO; NENITA F. SCOTT;
Deeds, Caloocan City. Said case was docketed as Civil Case No. C-15791.
SPS. JUANITO JAMILAR and JOSEFINA JAMILAR; SPS. Chairperson,
MARIANO GILTURA and ADELA GILTURA,
AUSTRIA-MARTINEZ, The antecedents are as follows:
Respondents.
CHICO-NAZARIO,
Sometime in 1980, Nenita Scott (Scott) approached respondent Nicolas Capistrano, Jr.
NACHURA, and
(Capistrano) and offered her services to help him sell his 13,785 square meters of land
REYES, JJ.
covered by Transfer Certificate of Title (TCT) No. 76496 of the Register of Deeds of
Caloocan City. Capistrano gave her a temporary authority to sell which expired without any
Promulgated: sale transaction being made. To his shock, he discovered later that TCT No. 76496, which
was in his name, had already been cancelled on June 24, 1992 and a new one, TCT No.
July 28, 2008 249959, issued over the same property on the same date to Josefina A. Jamilar. TCT No.
249959 likewise had already been cancelled and replaced by three (3) TCTs (Nos.
251524, 251525, and 251526), all in the names of the Jamilar spouses. TCT Nos. 251524
x------------------------------------------------------------------------------------x
and 251526 had also been cancelled and replaced by TCT Nos. 262286 and 262287
NACHURA, J.: 1. The cancellation of his TCT No. 76496 and the issuance
of TCT No. 249959 to Jamilar were based upon two (2) deeds
of sale, i.e., a Deed of Absolute Sale purportedly executed by
him in favor of Scott on March 9, 1980 and a Deed of
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Land Titles and Deeds (Finals) 2017
Absolute Sale allegedly executed by Scott in favor of Jamilar 9. Around August 18, 1992, Sy, Golpeo, and Tan filed Civil
on May 17, 1990. Case No. C-15551 against the Jamilars and another couple,
the Giltura spouses, for alleged violations of the Contract to
2. The supposed 1980 sale from him to Scott was Sell. They caused a notice of lis pendens to be annotated on
for P150,000.00; but despite the lapse of more than 10 years the three (3) TCTs in Jamilars name. Said civil case, however,
thereafter, the alleged 1990 sale from Scott to Jamilar was was not prosecuted.
also for P150,000.00.
10. On January 26, 1993, a Deed of Absolute Sale was
3. Both deeds were presented for registration simultaneously executed by the Jamilars and the Gilturas, in favor of Golpeo
on June 24, 1992. and Tan. Thus, TCT Nos. 251524 and 251526 were cancelled
and TCT Nos. 262286 and 262287 were issued to Golpeo
4. Although the deed in favor of Scott states that it was and Tan, respectively. TCT No. 251525 remained in the name
executed on March 9, 1980, the annotation thereof at the of Jamilar.[1]
back of TCT No. 76496 states that the date of the instrument
is March 9, 1990.
Thus, the action for reconveyance filed by Capistrano, alleging that his and his
5. Even if there was no direct sale from Capistrano to
Jamilar, the transfer of title was made directly to the latter. No wifes signatures on the purported deed of absolute sale in favor of Scott were forgeries;
TCT was issued in favor of Scott.
that the owners duplicate copy of TCT No. 76496 in his name had always been in his
6. The issuance of TCT No. 249959 in favor of Jamilar was possession; and that Scott, the Jamilar spouses, Golpeo, and Tan were not innocent
with the help of Joseph Sy, who provided for (sic) money for
the payment of the capital gains tax, documentary stamps, purchasers for value because they all participated in defrauding him of his
transfer fees and other expenses of registration of the deeds
property. Capistrano claimed P1,000,000.00 from all defendants as moral
of sale.
damages, P100,000.00 as exemplary damages; and P100,000.00 as attorneys fees.
7. On July 8, 1992, an Affidavit of Adverse Claim was In their Answer with Counterclaim, the Jamilar spouses denied the allegations in
annotated at the back of Jamilars TCT No. 249959 at the
instance of Sy, Golpeo, and Tan under a Contract to Sell in the complaint and claimed that Capistrano had no cause of action against them, as there
their favor by the Jamilar spouses. Said contract was
was no privity of transaction between them; the issuance of TCT No. 249959 in their
executed sometime in May, 1992 when the title to the
property was still in the name of Capistrano. names was proper, valid, and legal; and that Capistrano was in estoppel. By way of
8. Around July 28, 1992, upon request of the Jamilar counterclaim, they sought P50,000.00 as actual damages, P50,000.00 as moral
spouses, TCT No. 249959 was cancelled and three (3) new
certificates of title (TCT Nos. 251524, 251525, and 251526) damages, P50,000.00 as exemplary damages, and P50,000.00 as attorneys fees.
all in the name of Jamilar on the basis of an alleged
subdivision plan (No. Psd-13-011917) without Capistranos In their Answer, Sy, Golpeo, and Tan denied the allegations in the complaint and
knowledge and consent as registered owner. The notice of
adverse claim of Sy, Golpeo, and Tan was carried over to the alleged that Capistrano had no cause of action against them; that at the time they bought
three new titles.
the property from the Jamilars and the Gilturas as unregistered owners, there was nothing
in the certificates of title that would indicate any vice in its ownership; that a buyer in good
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Land Titles and Deeds (Finals) 2017
faith of a registered realty need not look beyond the Torrens title to search for any defect; Thereafter, trial on the merits ensued.
and that they were innocent purchasers of the land for value. As counterclaim, they
Subsequently, the trial court decided in favor of Capistrano. In its Decision
sought P500,000.00 as moral damages and P50,000.00 as attorneys fees.
dated May 7, 1996, adopting the theory of Capistrano as presented in his memorandum,
In her Answer with Cross-claim, Scott denied the allegations in the complaint and
alleged that she had no knowledge or any actual participation in the execution of the deeds 1. Declaring plaintiff herein as the absolute owner of the
parcel of land located at the Tala Estate,
of sale in her favor and the Jamilars; that she only knew of the purported conveyances
Bagumbong, Caloocan City and covered by TCT No. 76496;
when she received a copy of the complaint; that her signatures appearing in both deeds of
2. Ordering defendant Register of Deeds to cause the
sale were forgeries; that when her authority to sell the land expired, she had no other cancellation of TCT No. 251525 registered in the name of
defendant Josefina Jamilar;
dealings with it; that she never received any amount of money as alleged consideration for
the property; and that, even if she were the owner, she would never have sold it at so low
3. Ordering defendant Register of Deeds to cause the
a price.
cancellation of TCT Nos. 262286 and 262287 registered in
the names of defendants Nelson Golpeo and John B. Tan;
By way of Cross-claim against Sy, Golpeo, Tan, and the Jamilars, Scott alleged
that when she was looking for a buyer of the property, the Jamilars helped her locate the
4. Ordering defendant Register of Deeds to cause the
property, and they became conversant with the details of the ownership and other
issuance to plaintiff of three (3) new TCTs, in replacement of
particulars thereof; that only the other defendants were responsible for the seeming the aforesaid TCTs Nos. 251525, 262286 and 262287;
criminal conspiracy in defrauding Capistrano; that in the event she would be held liable to
him, her other co-defendants should be ordered to reimburse her of whatever amount she 5. Ordering all the private defendants in the above-captioned
case to pay plaintiff, jointly and severally, the reduced amount
may be made to pay Capistrano; that she was entitled to P50,000.00 as moral damages
of P400,000.00 as moral damages;
and P50,000.00 as attorneys fees from her co-defendants due to their fraudulent conduct.
Later, Sy, Golpeo, and Tan filed a third-party complaint against the Giltura 6. Ordering all the private defendants in the above-captioned
case to pay to plaintiff, jointly and severally, the reduced sum
spouses who were the Jamilars alleged co-vendors of the subject property. of P50,000.00 as exemplary damages;
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Land Titles and Deeds (Finals) 2017
therefor was considered part of the purchase price they paid for their property.
8. Ordering the dismissal of defendants Sy, Golpeo and
Tans Cross-Claim against defendant spouses Jamilar;
In their Comment, the heirs of Capistrano, who were substituted after the latters
9. Ordering the dismissal of defendants Sy, Golpeo and
Tans Third-Party Complaint against defendant spouses death, reiterated the factual circumstances which should have alerted the petitioners to
Giltura; and
conduct further investigation, thus
On appeal, the CA, in its Decision dated July 23, 2002, affirmed the Decision of the trial (b) Whether or not the owners copy of Capistranos certificate
of title had really been lost;
court with the modification that the Jamilar spouses were ordered to return to Sy, Golpeo,
(c) Whether Capistrano really sold his property to Scott and
and Tan the amount of P1,679,260.00 representing their full payment for the property, with whether Scott actually sold it to the Jamilars, which matters
legal interest thereon from the date of the filing of the complaint until full payment. were easily ascertainable as both Capistrano and Scott were
still alive and their names appear on so many documents;
Hence, this petition, with petitioners insisting that they were innocent purchasers for value (d) Why the consideration for both the March 9, 1980 sale and
the May 17, 1990 sale was the same (P150,000.00), despite
of the parcels of land covered by TCT Nos. 262286 and 262287. They claim that when the lapse of more than 10 years;
they negotiated with the Jamilars for the purchase of the property, although the title thereto
(e) Why the price was so low (P10.88 per square meter, both
was still in the name of Capistrano, the documents shown to them the court order directing in 1980 and in 1990) when the petitioners were willing to pay
and actually paid P150.00 per square meter in May 1992; and
the issuance of a new owners duplicate copy of TCT No. 76496, the new owners duplicate
(f) Whether or not both deeds of sale were authentic. [3]
copy thereof, the tax declaration, the deed of absolute sale between Capistrano and Scott,
the deed of absolute sale between Scott and Jamilar, and the real estate tax receipts there
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Land Titles and Deeds (Finals) 2017
In addition, the heirs of Capistrano pointed out that petitioners entered into By the same token, we agree with the CA when it held that the deed of sale between Scott
negotiations over the property, not with the registered owner thereof, but only with those and the Jamilars was also forged, as it noted the stark differences between the signatures
claiming ownership thereof based on questionable deeds of sale. of Scott in the deed of sale and those in her handwritten letters to Capistrano.
The petition should be denied. The arguments proffered by petitioners all pertain Second. In finding that the Jamilar spouses were not innocent purchasers for value of the
to factual issues which have already been passed upon by both the trial court and the CA. subject property, the CA properly held that they should have known that the signatures of
Scott and Capistrano were forgeries due to the patent variance of the signatures in the two
Findings of facts of the CA are final and conclusive and cannot be reviewed on appeal, as
deeds of sale shown to them by Scott, when Scott presented to them the deeds of sale,
long as they are based on substantial evidence. While, admittedly, there are exceptions to
one allegedly executed by Capistrano in her favor covering his property; and the other
this rule such as: (a) when the conclusion is a finding grounded entirely on speculations,
allegedly executed by Scott in favor of Capistrano over her property, the P40,000.00
surmises or conjectures; (b) when the inference made is manifestly mistaken, absurd or
consideration for which ostensibly constituted her initial and partial payment for the sale of
impossible; (c) when there is grave abuse of discretion; (d) when the judgment is based on
Capistranos property to her.
a misapprehension of facts; (e) when the findings of facts are conflicting; (f) when the CA,
in making its findings, went beyond the issues of the case and the same were contrary to The CA also correctly found the Gilturas not innocent purchasers for value, because they
the admissions of both the appellant and appellee. [4] Not one of these exceptional failed to check the veracity of the allegation of Jamilar that he acquired the property from
First. The CA was correct in upholding the finding of the trial court that the purported sale In ruling that Sy was not an innocent purchaser for value, we share the observation of the
of the property from Capistrano to Scott was a forgery, and resort to a handwriting expert appellate court that Sy knew that the title to the property was still in the name of
was not even necessary as the specimen signature submitted by Capistrano during trial Capistrano, but failed to verify the claim of the Jamilar spouses regarding the transfer of
showed marked variance from that found in the deed of absolute sale. The technical ownership of the property by asking for the copies of the deeds of absolute sale between
procedure utilized by handwriting experts, while usually helpful in the examination of Capistrano and Scott, and between Scott and Jamilar. Sy should have likewise inquired
forged documents, is not mandatory or indispensable to the examination or comparison of why the Gilturas had to affix their conformity to the contract to sell by asking for a copy of
handwritings.[5] the deed of sale between the Jamilars and the Gilturas. Had Sy done so, he would have
learned that the Jamilars claimed that they purchased the property from Capistrano and
We also note, as found by both the trial court and the CA, Tans testimony that he, Golpeo despite the claim that Capistrano sold his property to Scott and it was Scott who sold the
and Sy are brothers, he and Golpeo having been adopted by Sys father. Tan also testified same to the Jamilars.
that he and Golpeo were privy to the transaction between Sy and the Jamilars and the
In light of the foregoing disquisitions, based on the evidence on record, we find
Gilturas, as shown by their collective act of filing a complaint for specific performance to
no error in the findings of the CA as to warrant a discretionary judicial review by this Court.
enforce the contract to sell.
WHEREFORE, the petition is DENIED DUE COURSE for failure to establish reversible
Also noteworthy and something that would have ordinarily aroused suspicion is the fact
error on the part of the Court of Appeals. Costs against petitioners.
that even before the supposed execution of the deed of sale by Scott in favor of the
Jamilars, the latter had already caused the subdivision of the property into nine (9) lots,
Notable likewise is that the owners duplicate copy of TCT No. 76496 in the name of
Capistrano had always been in his possession since he gave Scott only a photocopy
thereof pursuant to the latters authority to look for a buyer of the property. On the other
hand, the Jamilars were able to acquire a new owners duplicate copy thereof by filing an
affidavit of loss and a petition for the issuance of another owners duplicate copy of TCT
No. 76496. The minimum requirement of a good faith buyer is that the vendee of the real
property should at least see the owners duplicate copy of the title. [6] A person who deals
with registered land through someone who is not the registered owner is expected to look
beyond the certificate of title and examine all the factual circumstances thereof in order to
determine if the vendor has the capacity to transfer any interest in the land. He has the
duty to ascertain the identity of the person with whom he is dealing and the latters legal
authority to convey.[7]
Finally, there is the questionable cancellation of the certificate of title of Capistrano which
resulted in the immediate issuance of a certificate of title in favor of the Jamilar spouses
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
DOMINGO REALTY, INC. G.R. No. 126236 On November 19, 1981, petitioner Domingo Realty filed its November 15, 1981
and AYALA STEEL
MANUFACTURING CO., INC., Complaint[3] with the Pasay City RTC against Antonio M. Acero, who conducted business
Petitioners,
Present: under the firm name A.M. Acero Trading,[4] David Victorio, John Doe, and Peter Doe, for
QUISUMBING, J., Chairperson, recovery of possession of three (3) parcels of land located in Cupang, Muntinlupa, Metro
- versus - CARPIO,
CARPIO MORALES, Manila, covered by (1) Transfer Certificate of Title (TCT) No. (75600) S-107639-Land
TINGA, and
VELASCO, JR., JJ. Records of Rizal; (2) TCT No. (67006) S-107640-Land Records of Rizal; and (3) TCT No.
COURT OF APPEALS and Promulgated: (67007) S-107643-Land Records of Rizal (the subject properties). The said lots have an
ANTONIO M. ACERO,
aggregate area of 26,705 square meters, more or less, on a portion of which Acero had
Respondents. January 26, 2007
x-----------------------------------------------------------------------------------------x
constructed a factory building for the manufacture of hollow blocks, as alleged by Domingo
DECISION
Realty.
VELASCO, JR., J.:
Good judgment comes from experience, and often experience comes On January 4, 1982, defendants Acero and Victorio filed their December 21,
from bad judgment.
Rita Mae Brown 1981 Answer[5] to the Complaint in Civil Case No. 9581-P. Acero alleged that he merely
leased the land from his co-defendant David Victorio, who, in turn, claimed to own the
The Case
property on which the hollow blocks factory of Acero stood. In the Answer, Victorio
assailed the validity of the TCTs of Domingo Realty, alleging that the said TCTs emanated
This Petition for Review on Certiorari, under Rule 45 of the Revised Rules of
from spurious deeds of sale, and claimed that he and his predecessors-in-interest had
Court, seeks the reversal of the October 31, 1995 Decision [1] of the Court of Appeals (CA)
been in possession of the property for more than 70 years.
in CA-G.R. SP No. 33407, entitled Antonio M. Acero v. Hon. Sofronio G. Sayo, et al.,
denied petitioners Motion for Reconsideration of its October 31, 1995 Decision. 1. That defendants admit and recognize the ownership of the
plaintiff over the property subject of this case, covered by TCT
No. S-107639 (75600), S-107643 (67007), and S-107640
(67006) with a total area of 26,705 square meters;
The Facts
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
6. That plaintiff acknowledges the benefit done by defendant No. Vs-13-000135. In the said Verification Survey Plan, petitioners TCTs covered the
Luis Recato Dy on the property by incurring expenses in
protecting and preserving the property by way of construction of entire land occupied by the respondents hollow block factory.[13]
perimeter fence and maintaining a caretaker therein and plaintiff
has agreed to pay Luis Recato Dy the amount of P100,000.00
upon approval of this agreement by this Honorable Court.[7]
On April 10, 1990, petitioner Ayala Steel Manufacturing Co., Inc. (Ayala Steel) filed its
March 30, 1990 Motion for Substitution alleging that it had purchased the subject lots,
Acting on the Compromise Agreement, the Pasay City RTC rendered
attaching to the motion TCT Nos. 152528, 152529, and 152530 all in its name, as proof of
the December 7, 1987 Decision which adopted the aforequoted six (6) stipulations and
purchase.[14]
approved the Compromise Agreement.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
The said motion was opposed by Acero claiming that this case has already been being occupied by respondent, which is about 2,000 square meters, more or less. He
terminated in accordance with the compromise agreement of the parties, hence, reiterated the same contentions in his December 21, 1991 Manifestation.[21]
substitution will no longer be necessary and justified under the circumstances. [15] The
motion was not resolved which explains why both transferor Domingo Realty and On January 13, 1992, respondent filed a Motion to Modify Order Dated 6 December
transferee Ayala Steel are co-petitioners in the instant petition. 91,[22] claiming that the said Order modified the Compromise Agreement considering that it
allegedly involved only 1,357 square meters and not the entire lot;[23] and if not amended,
In its December 28, 1990 Order,[16] the trial court directed Acero to conduct his own re- the Order would deviate from the principle that no man shall enrich himself at the expense
survey of the lots based on the technical description appearing in the TCTs of Domingo of the other.
Realty and to have the re-survey plans approved by the Bureau of Lands. The Order
In its January 15, 1992 Order,[24] the trial court approved the issuance of a Writ of
resulted from Aceros contention that he occupied only 2,000 square meters of petitioners
Execution to enforce the December 7, 1987 Decision. On February 3, 1992, respondent
property.
Acero subsequently filed a Motion for Reconsideration[25]of the January 15, 1992 Order
arguing that the Order was premature and that Verification Survey Plan No. Vs-13-000135
Acero employed the services of Engr. Eligio L. Cruz who came up with Verification Survey
violated the Compromise Agreement.
Plan No. Vs-13-000185. However, when the said Verification Survey Plan was presented
On January 18, 1992, the Pasay City Hall was gutted by fire, destroying the records of the
to the Bureau of Lands for approval, it was rejected because Engr. Cruz failed to comply
lower court, including those of this case. Thus, after reconstituting the records, the trial
with the requirements of the Bureau.[17]
court issued the October 6, 1992 Order,[26] reiterating its January 15, 1992 Order and
On April 8, 1991, petitioners filed a Manifestation with Motion praying for the denial of
ordering the issuance of a Writ of Execution.
respondents Motion to Nullify the Compromise Agreement and for the approval of
Verification Survey Plan No. Vs-13-000135 prepared by Engr. Lara of the Bureau of
On October 23, 1992, respondent filed a Manifestation and Compliance,[27] alleging that
Lands. The Pasay City RTC issued the December 6, 1991 Order[18] denying respondent
Verification Survey Plan No. Vs-13-000185 had been approved by the Regional Director of
Aceros Motion to Nullify the Compromise Agreement. As a consequence, petitioners filed a
the DENR; thus, he moved for the annulment of the October 6, 1992 Order granting the
Motion for Execution on December 10, 1991.[19]
Writ of Execution in favor of petitioners.
On January 6, 1992, respondent filed an undated Manifestation [20] claiming, among others,
Given the conflicting Verification Survey Plans of the parties, the trial court issued
that it was on record that the Compromise Agreement was only as to a portion of the land
the October 11, 1993 Order[28] requiring the Bureau of Lands Director to determine which
Subsequently, Regional Technical Director Eriberto V. Almazan of the Land Registration On October 31, 1995, the CA promulgated the assailed Decision, the fallo of which reads:
Authority issued the November 24, 1993 Order[29] cancelling Verification Survey Plan No.
IN VIEW OF THE FOREGOING, the petition for certiorari
Vs-13-000185, submitted by Engineer Eligio Cruz, who was hired by respondent Acero, is GRANTED and the Orders of respondent court
dated December 6, 1991, January 15, 1992, October 6, 1992,
and declared Verification Survey Plan No. Vs-13-000135, submitted by Engineer Lara of and January 12, 1994, and February 1, 1994 are SET
ASIDE. In the interest of justice, and consistent with the views
the Bureau of Lands, as the correct Plan. expressed by this Court, the Compromise Judgment dated
December 7, 1987 of respondent court is likewise SET
ASIDE. Respondent Court is likewise directed to proceed with
the hearing of Civil Case No. 9581-P on the merits and
Thereafter, petitioners filed their January 12, 1994 Ex-parte Manifestation with determine, once and for all, the respective proprietary rights of
the litigants thereto.
Motion,[30] praying for the implementation of the Writ of Execution against the disputed
SO ORDERED.[35]
lands, which was granted in the January 12, 1994 Order.[31]
In discarding the December 7, 1987 Decision based on the Compromise Agreement, the
Respondents Motion for Reconsideration[32] of the January 12, 1994 Order was denied in
appellate court ratiocinated that David Victorio, the alleged lessor of Acero, was not a party
the February 1, 1994 Order[33] of the Pasay City RTC.
to the Compromise Agreement; thus, there would always remain the probability that he
might eventually resurface and assail the Compromise Agreement, giving rise to another
Aggrieved, respondent Acero filed before the CA his February 23, 1994 Petition for
suit. Moreover, the CA found the Compromise Agreement vague, not having stipulated a
Certiorari and Mandamus with Urgent Prayer for Issuance of a Temporary Restraining
mutually agreed upon surveyor, who would survey the properties using as a basis, survey
Order,[34] under Rule 65 of the Rules of Court, against petitioners and Judge Sofronio G.
plans acceptable to both, and to thereafter submit a report to the court. [36]
Sayo as presiding judge of the lower court. In the petition, respondent sought to nullify and
set aside the RTC Orders dated December 6, 1991, January 15, 1992, October 6, 1992,
Likewise, the CA sustained Aceros belief that he would only have to vacate a portion of the
January 12, 1994, and February 1, 1994, all of which pertain to the execution of the
property he was presently occupying, which was tantamount to a mistake that served as
December 7, 1987 Decision on the Compromise Agreement. Significantly, respondent did
basis for the nullification of the Compromise Agreement entered into.
not seek the annulment of said judgment but merely reiterated the issue that under the
The Issues I.
II.
1. THE RESPONDENT COURT OF APPEALS ERRED IN
NULLIFYING AND SETTING ASIDE JUDGMENT ON WHETHER THE NON-INCLUSION OF DAVID VICTORIO
COMPROMISE AGREEMENT AND THE COMPROMISE WOULD NULLIFY THE COMPROMISE AGREEMENT;
AGREEMENT ITSELF AS WELL AS THE SUBSEQUENT
ORDERS OF THE COURT A QUO THOUGH THERE IS NO
MOTION TO SET ASIDE THE JUDGMENT ON THE
COMPROMISE AGREEMENT BEFORE THE COURT A QUO
ON THE GROUND OF FRAUD, MISTAKE OR DURESS;
2. THE RESPONDENT COURT OF APPEALS ERRED IN III.
NULLIFYING AND SETTING ASIDE THE JUDGMENT ON
COMPROMISE AGREEMENT AND THE COMPROMISE WHETHER THE JUDGMENT ON COMPROMISE
AGREEMENT ITSELF AS WELL AS THE SUBSEQUENT AGREEMENT SHOULD BE SET ASIDE ON THE GROUND OF
ORDERS OF THE COURT OF QUO [SIC] THOUGH IN THE VAGUENESS; AND
PETITION FOR CERTIORARI AND MANDAMUS BEFORE
RESPONDENT COURT OF APPEALS, PRIVATE IV.
RESPONDENT ARGUED THAT JUDGMENT ON
COMPROMISE AGREEMENT IS FINAL, EXECUTORY, WHETHER THE JUDGMENT ON COMPROMISE
IMMUTABLE AND UNALTERABLE; AGREEMENT SHOULD BE SET ASIDE ON THE GROUND OF
MISTAKE.
3. THE RESPONDENT COURT OF APPEALS ERRED IN
NULLIFYING AND SETTING ASIDE JUDGMENT ON
COMPROMISE AGREEMENT AND THE COMPROMISE
AGREEMENT ITSELF AS WELL AS THE SUBSEQUENT The Courts Ruling
ORDERS OF THE COURT A QUO BASED ON FRAUD OR
MISTAKE THOUGH SAID ISSUES WERE NOT RAISED
BEFORE THE COURT A QUO, AND NO EVIDENCE WAS
INTRODUCED TO SUBSTANTIATE FRAUD OR MISTAKE The petition is meritorious.
BEFORE THE COURT A QUO;
Code. If the contract assumes the form of a Compromise Agreement between the parties
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
in a civil case, then a judgment rendered on the basis of such covenant is final,
unappealable, and immediately executory. If one of the parties claims that his consent was If the 15-day period for taking an appeal has lapsed, then the aggrieved party can avail of
obtained through fraud, mistake, or duress, he must file a motion with the trial court that Rule 38 by filing a petition for relief from judgment which should be done within 60 days
approved the compromise agreement to reconsider the judgment and nullify or set aside after the petitioner learns of the judgment, but not more than six (6) months after such
said contract on any of the said grounds for annulment of contract within 15 days from judgment or final order was entered. Prior to the effectivity of the 1997 Rules of Civil
notice of judgment. Under Rule 37, said party can either file a motion for new trial or Procedure in 1997, if the court denies the petition under Rule 38, the remedy is to appeal
reconsideration. A party can file a motion for new trial based on fraud, accident or mistake, from the order of denial and not from the judgment since said decision has already
excusable negligence, or newly discovered evidence. become final and already unappealable.[41] However, in the appeal from said order, the
appellant may likewise assail the judgment. Under the 1997 Rules of Civil Procedure, the
On the other hand, a party may decide to seek the recall or modification of the judgment by aggrieved party can no longer appeal from the order denying the petition since this is
means of a motion for reconsideration on the ground that the decision or final order is proscribed under Section 1 of Rule 41. The remedy of the party is to file a special civil
contrary to law if the consent was procured through fraud, mistake, or duress. Thus, the action for certiorari under Rule 65 from the order rejecting the petition for relief from
motion for a new trial or motion for reconsideration is the readily available remedy for a judgment.
party to challenge a judgment if the 15-day period from receipt of judgment for taking an
appeal has not yet expired. This motion is the most plain, speedy, and adequate remedy in The records of the case reveal the following:
immediately executory, can still be annulled for vices of consent or forgery. [39] 1. December 3, 1987 the parties signed the Compromise Agreement;
Prior to the effectivity of the 1997 Rules of Civil Procedure on July 1, 1997, an order 2. December 7, 1987 a decision/judgment was rendered based on the December 3,
denying a motion for new trial or reconsideration was not appealable since the judgment in 1987 Compromise Agreement;
the case is not yet final. The remedy is to appeal from the challenged decision and the
denial of the motion for reconsideration or new trial is assigned as an error in the 3. February 2, 1988 Acero filed a Motion to Nullify the Compromise Agreement;
appeal.[40] Under the present [1997] Rules of Civil Procedure, the same rule was
maintained that the order denying said motion is still unappealable and the rule is still to 4. December 6, 1991 the trial court denied Aceros Motion to Nullify the Compromise
appeal from the judgment and not from the order rejecting the motion for Agreement;
reconsideration/new trial.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
5. December 11, 1991 defendant Acero received the December 6, 1991 Order which then Acero should have filed an appeal from the December 7, 1987 Decision and assigned
denied said motion;[42] as error the December 6, 1991 Order denying said motion pursuant to the rules existing
prior to the 1997 Rules of Civil Procedure. He failed to file such appeal but instead filed a
6. December 26, 1991 the 15-day period to appeal to the CA expired by the failure of petition for certiorari under Rule 65 with the CA on April 4, 1994. This is prejudicial to
defendant Acero to file an appeal with said appellate court; respondent Acero as the special civil action of certiorari is not the proper remedy. If the
aggrieved party does not interpose a timely appeal from the adverse decision, a special
7. January 15, 1992 the trial court issued the Order which granted petitioners motion for civil action for certiorari is not available as a substitute for a lost appeal.[43]
8. October 6, 1992 the trial court reiterated its January 15, 1992 Order directing the What respondent Acero should have done was to file a petition for relief from judgment
issuance of a Writ of Execution after the records of the case were lost in a fire that gutted when he became aware that he lost his right of appeal on December 26, 1991. Even with
the Pasay City Hall; this approach, defendant Acero was also remiss.
9. January 12, 1994 the trial court issued the Order which directed the implementation of In sum, the petition for certiorari instituted by respondent Acero with the CA is a wrong
the Writ of Execution prayed for by petitioners; remedy; a simple appeal to the CA would have sufficed. Since the certiorari action is an
improper legal action, the petition should have been rejected outright by the CA.
10. February 1, 1994 the trial court issued the Order which denied respondents Motion for
Reconsideration of its January 12, 1994 Order; and Assuming arguendo that a petition for certiorari with the CA is the appropriate remedy, still,
11. April 4, 1994 Acero filed with the CA a petition for certiorari in CA-G.R. SP No. 33407
entitled Antonio M. Acero v. Domingo Realty, Inc., et al. The petition before the CA was filed prior to the effectivity of the 1997 Rules of Court when
there was still no prescribed period within which to file said petition, unlike in the present
In his undated Manifestation, respondent Acero admitted having received a copy of Section 4 of Rule 65 wherein a Petition for Certiorari and Mandamus must be filed within
the December 7, 1987 Decision on December 11, 1987. However, it was only on February 60 days from notice of the judgment, final order, or resolution appealed from, or of the
2, 1988 when he filed a Motion to Nullify the Compromise Agreement which was discarded denial of the petitioners motion for new trial or reconsideration after notice of judgment.
for lack of merit by the trial court on December 6, 1991. If the Motion to Nullify the
Compromise Agreement is treated as a motion for reconsideration and/or for new trial, Section 4, Rule 65 previously read:
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Petitions for certiorari under Rules 43, 44 and 45 shall be filed compromise agreement if one of the parties in a case is not included in the settlement. The
with the Supreme Court.
only legal effect of the non-inclusion of a party in a compromise agreement is that said
party cannot be bound by the terms of the agreement. The Compromise Agreement shall
Before the 1997 Rules of Civil Procedure became effective on July 1, 1997, the yardstick however be valid and binding as to the parties who signed thereto. [47]
to determine the timeliness of a petition for certiorari under Rule 65 was the
reasonableness of the time that had elapsed from receipt of notice of the assailed order/s The issue of ownership between petitioners and David Victorio can be threshed out by the
of the trial court up to the filing of the appeal with the CA. [44] In a number of cases, the trial court in Civil Case No. 9581-P. The proper thing to do is to remand the case for
Court ruled that reasonable time can be pegged at three (3) months. [45] continuation of the proceedings between petitioners and defendant David Victorio but not
to annul the partial judgment between petitioners and respondent Acero which has been
In the present case, the Order denying the Motion to Nullify the Compromise Agreement pending execution for 20 years.
was issued on December 6, 1991. The petition for certiorari was filed on April 4, 1994. The
period of two (2) years and four (4) months cannot be considered fair and reasonable. With With regard to the third issue, petitioners assail the ruling of the CA that the Compromise
respect to the January 15, 1992 Order granting the writ of execution and the October 6, Agreement is vague as there is still a need to determine the exact metes and bounds of
1992 Order directing the issuance of the writ, it is evident that the petition before the CA the encroachment on the petitioners lot.
was filed more than three (3) months after the receipt by respondent Acero of said orders
and the filing of the petition is likewise unreasonably delayed. The object of a contract, in order to be considered as certain, need not specify
such object with absolute certainty. It is enough that the object is determinable in order for
On the second issue, petitioners assail the ruling of the appellate court that David Victorio it to be considered as certain. Article 1349 of the Civil Code provides:
Article 1349. The object of every contract must be determinate
who is claimed to be the lessor of Acero, and who is impleaded as a defendant in Civil as to its kind. The fact that the quantity is not determinate shall
not be an obstacle to the existence of the contract, provided it is
Case No. 9581-P, was not made a party to the Compromise Agreement and hence, he possible to determine the same, without the need of a new
contract between the parties.
may later assail the compromise agreement as not binding upon him, thereby giving rise to
another suit.[46]
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
the final determinant of the extent of the property of petitioners. Thus, the area of xxxx
3. That defendant Acero admits that the property he is
petitioners property is determinable based on the technical descriptions contained in the presently occupying by way of lease is encroaching on
a portion of the property of the plaintiff and assume and
TCTs. undertakes to vacate, remove and clear any and all
structures erected inside the property of the plaintiff by
himself and other third parties, duly authorized and/or who have
an existing agreement with defendant Acero, and shall deliver
Notably, the determination made by the Bureau of Landsthat Verification Survey said portion of the property of the plaintiff free and clear of any
unauthorized structures, shanties, occupants, squatters or
Plan No. Vs-13-000135 is the correct Planis controlling and shall prevail over Verification
lessees within a period of sixty (60) days from date of signing of
this compromise agreement. Should defendant Acero fail in his
Survey Plan No. Vs-13-000185 submitted by Acero. Findings of fact by administrative
obligation to vacate, remove and clear the structures erected
inside the property of the plaintiff within the period of 60 days
agencies, having acquired expertise in their field of specialization, must be given great
afore-mentioned, plaintiff shall be entitled to a writ of execution
weight by this Court.[48] Even if the exact area of encroachment is not specified in the for the immediate demolition or removal of said structure to fully
implement this agreement; and ejectment of all squatters and
agreement, it can still be determined from the technical description of the title of plaintiff occupants and lessees, including the dependents to fully
implement this agreement. (Emphasis supplied.)
which defendant Acero admitted to be correct. Thus, the object of the Compromise
Moreover, vagueness is defined in Blacks Law Dictionary as: indefinite, uncertain; not Compromise Agreement refers to the property which they are occupying. Respondents
susceptible of being understood. interpretation of paragraph 3 of the Compromise Agreement is mistaken as it is anchored
on his belief that the encroachment on the property of petitioners is only a portion and not
A perusal of the entire Compromise Agreement will negate any contention that there is the entire lot he is occupying. This is apparent from his Supplement to his Petition for
vagueness in its provisions. It must be remembered that in the interpretation of contracts, Certiorari and Mandamus where he explained:
Compromise Agreement,[50] taken together with paragraph one (1) which we quote:
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
This contention is incorrect. The agreement is clear that respondent Acero Finally, with regard to the fourth issue, petitioners question the finding of the CA that the
admitted that the property he is presently occupying by way of lease is encroaching on compromise judgment can be set aside on the ground of mistake under Article 2038 of the
a portion of the property of the plaintiff. Thus, whether it is only a portion or the entire lot Civil Code, because respondent Acero gave his consent to the Compromise Agreement in
Acero is leasing that will be affected by the agreement is of no importance. What controls good faith that he would only vacate a portion of his lot in favor of petitioner Domingo
is the encroachment on the lot of petitioner Domingo Realty regardless of whether the Realty.
entire lot or only a portion occupied by Acero will be covered by the encroachment.
We rule otherwise.
While it may be the honest belief of respondent Acero that only a portion of the lot he is
occupying encroaches on the 26,705-square meter lot of petitioner Domingo Realty and Articles 2038 and 1330 of the Civil Code allow a party to a contract, on the ground of
later, Ayala Steel, the Court finds that the true and real agreement between the parties is mistake, to nullify a compromise agreement, viz:
that any encroachment by respondent Acero on the lot of petitioners will be surrendered to
Article 2038. A compromise in which there is mistake, fraud,
the latter. This is apparent from the undertaking in paragraph 3 that defendant Acero violence, intimidation, undue influence, or falsity of documents,
is subject to the provisions of Article 1330 of this Code.
undertakes to vacate, remove and clear any and all structures erected inside the property
Article 1330. A contract where the consent is given
of the plaintiff. This prestation results from the admission against the interest of respondent through mistake, violence, intimidation, undue influence, or
fraud is voidable (emphasis supplied).
Acero that he admits and recognizes the ownership of the plaintiff (Domingo Realty) over
portion of or the entire lot claimed by defendant David Victorio. To reiterate, the word Mistake has been defined as a misunderstanding of the meaning or implication of
portion refers to petitioners lot and not that of Aceros. Contrary to the disposition of the CA, something or a wrong action or statement proceeding from a faulty judgment x x x.[52]
we rule that the terms of the Compromise Agreement are clear and leave no doubt upon
the intent of the parties that respondent Acero will vacate, remove, and clear any and all Article 1333 of the Civil Code of the Philippines however states that there is no mistake if
structures erected inside petitioners property, the ownership of which is not denied by the party alleging it knew the doubt, contingency or risk affecting the object of the contract.
him. The literal meaning of the stipulations in the Compromise Agreement will control
under Article 1370 of the Civil Code. Thus, the alleged vagueness in the object of the Under this provision of law, it is presumed that the parties to a contract know and
agreement cannot be made an excuse for its nullification. understand the import of their agreement. Thus, civil law expert Arturo M. Tolentino opined
that:
To invalidate consent, the error must be excusable. It must be
real error, and not one that could have been avoided by the
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
party alleging it. The error must arise from facts unknown to
him. He cannot allege an error which refers to a fact known to to have the said stipulation incorporated in the Compromise Agreement is negligence on
him, or which he should have known by ordinary diligent
examination of the facts. An error so patent and obvious that his part and insufficient to abrogate said agreement.
nobody could have made it, or one which could have been
avoided by ordinary prudence, cannot be invoked by the
one who made it in order to annul his contract. A mistake
that is caused by manifest negligence cannot invalidate a In Torres v. Court of Appeals,[54] which was also cited in LL and Company Development
juridical act.[53] (Emphasis supplied.)
and Agro-Industrial Corporation v. Huang Chao Chun,[55] it was held that:
Prior to the execution of the Compromise Agreement, respondent Acero was already Under Article 1315 of the Civil Code, contracts bind the parties
not only to what has been expressly stipulated, but also to all
aware of the technical description of the titled lots of petitioner Domingo Realty and more necessary consequences thereof, as follows:
so, of the boundaries and area of the lot he leased from David Victorio. Before consenting ART. 1315. Contracts are perfected by mere
consent, and from that moment the parties
to the agreement, he could have simply hired a geodetic engineer to conduct a verification are bound not only to the fulfillment of what
has been expressly stipulated but also to all
survey and determine the actual encroachment of the area he was leasing on the titled lot the consequences which, according to their
nature, may be in keeping with good faith,
of petitioner Domingo Realty. Had he undertaken such a precautionary measure, he would usage and law.
have known that the entire area he was occupying intruded into the titled lot of petitioners It is undisputed that petitioners are educated and are thus
presumed to have understood the terms of the contract they
and possibly, he would not have signed the agreement. voluntarily signed. If it was not in consonance with their
expectations, they should have objected to it and insisted on the
provisions they wanted.
In this factual milieu, respondent Acero could have easily averted the alleged mistake in Courts are not authorized to extricate parties from the
necessary consequences of their acts, and the fact that the
the contract; but through palpable neglect, he failed to undertake the measures expected contractual stipulations may turn out to be financially
disadvantageous will not relieve parties thereto of their
of a person of ordinary prudence. Without doubt, this kind of mistake cannot be resorted to obligations. They cannot now disavow the relationship formed
from such agreement due to their supposed misunderstanding
by respondent Acero as a ground to nullify an otherwise clear, legal, and valid agreement, of its terms.
even though the document may become adverse and even ruinous to his business.
The mere fact that the Compromise Agreement favors one party does not render it
Moreover, respondent failed to state in the Compromise Agreement that he intended to
invalid. We ruled in Amarante v. Court of Appeals that:
vacate only a portion of the property he was leasing. Such provision being beneficial to
Compromises are generally to be favored and cannot be set
aside if the parties acted in good faith and made reciprocal
respondent, he, in the exercise of the proper diligence required, should have made sure
concessions to each other in order to terminate a case. This
that such matter was specified in the Compromise Agreement. Respondent Aceros failure holds true even if all the gains appear to be on one side
and all the sacrifices on the other (emphasis supplied).[56]
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
the title and the accurate metes and bounds of the lot embraced in the title. It is advisable VELASCO, JR., J.:
that such parties (1) verify the origin, history, authenticity, and validity of the title with the Nature of the Case
Office of the Register of Deeds and the Land Registration Authority; (2) engage the
Before Us is a Petition for Review on Certiorari under Rule 45 assailing the Decision 1 and
services of a competent and reliable geodetic engineer to verify the boundary, metes, and Resolution of the Court of Appeals (CA), dated June 6, 2012 and October 30, 2012,
respectively, in CA-G.R. CV No. 96659 entitled Enriqueta M Locsin v. Marylou Bolos, et al.
bounds of the lot subject of said title based on the technical description in the said title and In reversing the ruling of the trial court, the CA held that respondents are innocent
purchasers in good faith and for value of the subject property.
the approved survey plan in the Land Management Bureau; (3) conduct an actual ocular
The Facts
inspection of the lot; (4) inquire from the owners and possessors of adjoining lots with
respect to the true and legal ownership of the lot in question; (5) put up signs that said lot Petitioner Enriqueta M. Locsin (Locsin) was the registered owner of a 760-sq.m. lot
covered by Transfer Certificate of Title (TCT) No. 235094, located at 49 Don Vicente St.,
is being purchased, leased, or encumbered; and (6) undertake such other measures to Don Antonio Heights Subdivision, Brgy. Holy Spirit, Capitol, Quezon City. In 1992, she filed
an ejectment case, Civil Case No. 38-6633,2 against one Billy Aceron (Aceron) before the
make the general public aware that said lot will be subject to alienation, lease, or Metropolitan Trial Court, Branch 3 8 in Quezon City (MTC) to recover possession over the
land in issue. Eventually, the two entered into a compromise agreement, which the MTC
encumbrance by the parties. Respondent Acero, for all his woes, may have a legal approved on August 6, 1993.3
recourse against lessor David Victorio who inveigled him to lease the lot which turned out Locsin later went to the United States without knowing whether Aceron has complied with
his part of the bargain under the compromise agreement. In spite of her absence,
to be owned by another.
however, she continued to pay the real property taxes on the subject lot.
In 1994, after discovering thather copy of TCT No. 235094 was missing, Locsin filed a
WHEREFORE, the petition is hereby GRANTED and the assailed Decision and petition for administrative reconstruction in order to secure a new one, TCT No. RT-97467.
Sometime in early 2002, she then requested her counsel to check the status of the subject
Resolution of the CA are REVERSED. The questioned Orders of the Pasay City RTC lot. It was then that they discovered the following:
dated December 6, 1991, January 15, 1992, October 6, 1992, January 12, 1994, and
1. One Marylou Bolos (Bolos) had TCT No. RT-97467 cancelled on February 11,
February 1, 1994, including the Decision dated December 7, 1987, are AFFIRMED. The 1999, and then secured a new one, TCT No. N-200074, in her favor by
registering a Deed of Absolute Sale dated November 3, 1979 allegedly executed
case is remanded to the Pasay RTC, Branch III for further proceedings with respect to by Locsin with the Registry of Deeds;
petitioner Domingo Realtys November 15, 1981 Complaint [57] against one of the 2. Bolos later sold the subject lot to Bernardo Hizon (Bernardo) for PhP 1.5
million, but it was titled under Carlos Hizons (Carlos) name on August 12, 1999.
defendants, David Victorio. No costs. SO ORDERED. Carlos is Bernardos son;
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
3. On October 1, 1999, Bernardo, claiming to be the owner of the property, filed a The CA, however, affirmed the RTCs finding that herein respondents are innocent
Motion for Issuance of Writ of Execution for the enforcement of the court- purchasers for value. Citing Casimiro Development Corp. v. Renato L. Mateo, 7 the
approved compromise agreement in Civil Case No. 38-6633; appellate court held that respondents, having dealt with property registered under the
Torrens System, need not go beyond the certificate of title, but only has to rely on the said
4. The property was already occupied and was, in fact, up for sale. certificate. Moreover, as the CA added, any notice of defect or flaw in the title of the vendor
should encompass facts and circumstances that would impel a reasonably prudent man to
inquire into the status of the title of the property in order to amount to bad faith.
On May 9, 2002, Locsin, through counsel, sent Carlos a letter requesting the return of the
property since her signature in the purported deed of sale in favor of Bolos was a forgery.
In a letter-reply dated May 20, 2002, Carlos denied Locsins request, claiming that he was Accordingly, the CA ruled that Locsin can no longer recover the subject lot. 8 Hence, the
unaware of any defect or flaw in Bolos title and he is, thus, an innocent purchaser for insant petition.
value and good faith. On June 13, 2002,4 Bernardo met with Locsins counsel and
discussed the possibility of a compromise. He ended the meeting with a promise to come Arguments
up with a win-win situation for his son and Locsin, a promise which turned out to be
deceitful, for, on July 15, 2002, Locsin learned that Carlos had already sold the property for
Petitioner Locsin insists that Bernardo was well aware, at the time he purchased the
PhP 1.5 million to his sister and her husband, herein respondents Lourdes and Jose subject property, of a possible defect in Bolos title since he knew that another person,
Manuel Guevara (spouses Guevara), respectively, who, as early as May 24, 2002, had a Aceron, was then occupying the lot in issue. 9 As a matter of fact, Bernardo even moved for
new certificate of title, TCT No. N-237083, issued in their names. The spouses Guevara the execution of the compromise agreement between Locsin and Aceron inCivil Case No.
then immediately mortgaged the said property to secure a PhP 2.5 million loan/credit 38-6633 in order to enforce to oust Aceron of his possession over the property. 10
facility with Damar Credit Corporation (DCC).
Thus, petitioner maintains that Bernardo, knowing as he did the incidents involving the
It was against the foregoing backdrop of events that Locsin filed an action for subject property,should have acted as a reasonably diligent buyer in verifying the
reconveyance, annulment ofTCT No. N-237083, the cancellation of the mortgage lien authenticity of Bolostitle instead of closing his eyes to the possibility of a defecttherein.
annotated thereon, and damages, against Bolos, Bernardo, Carlos, the Sps. Guevara, Essentially, petitioner argues that Bernardos stubborn refusal to make an inquiry beyond
DCC, and the Register of Deeds, Quezon City, docketed as Civil Case No. Q-02-47925, the face of Bolos title is indicative of his lack of prudence in protecting himself from
which was tried by the Regional Trial Court, Branch 77 in Quezon City (RTC). The charges
possible defects or flaws therein, and consequently bars him from interposing the
against DCC, however, weredropped on joint motion ofthe parties. This is in view of the protection accorded toan innocent purchaser for value.
cancellation of the mortgage for failure of the spouses Guevara to avail of the loan/credit
facility DCC extended in their favor.5
As regards Carlos and the Sps. Guevaras admissions and testimonies, petitioner points
out that when these are placed side-by-side with the concurrent circumstances in the case,
Ruling of the Trial Court it is readily revealed that the transfer from the former to the latter was only simulated and
intended to keep the property out of petitioners reach.
On November 19, 2010, the RTC rendered a Decision6 dismissing the complaint and
finding for respondents,as defendants thereat, holding that: (a) there is insufficient For their part, respondents maintain that they had the right to rely solely upon the face of
evidence to showthat Locsins signature in the Deed of Absolute Sale between her and Bolos clean title, considering that it was free from any lien or encumbrance. They are not
Bolos is a forgery; (b) the questioned deed is a public document, having been notarized;
even required, so they claim, to check on the validity of the sale from which they derived
thus, it has, in its favor, the presumption of regularity; (c) Locsin cannot simply rely on the their title.11 Too, respondents claim that their knowledge of Acerons possession cannot be
apparent difference of the signatures in the deed and in the documents presented by her
the basis for an allegation of bad faith, for the property was purchased on an "asis where-
to prove her allegation of forgery; (d) the transfers of title from Bolos to Carlos and from is" basis. The Issue
Carlos to the spouses Guevara are valid and regular; (e) Bernardo, Carlos, and the
spouses Guevara are all buyers in good faith. Aggrieved, petitioner appealed the case to
the CA. Considering that the finding of the CAthat Locsins signature in the Deed of Absolute Sale
in favor of Bolos was indeed bogus commands itself for concurrence, the resolution of the
present petition lies on this singular issuewhether or not respondents are innocent
Ruling of the Court of Appeals purchasers for value.12
The CA, in its assailed Decision, ruled that it was erroneous for the RTC to hold that
The Courts Ruling
Locsin failed to prove that her signature was forged. In its appreciation of the evidence, the
CA found that, indeed, Locsins signature in the Deed of Absolute Sale in favor of Bolos
differs from her signatures in the other documents offered as evidence. The petition is meritorious.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Procedural issue 2. Engaging the services of a competent and reliable geodetic engineer to verify
the boundary,metes, and bounds of the lot subject of said title based on the
As a general rule, only questions of law may be raised in a petition for review on technical description in the said title and the approved survey plan in the Land
Management Bureau;
certiorari.13 This Court is not a trier offacts; and in the exercise of the power of review, we
do not normally undertake the re-examination of the evidence presented by the contending
parties during the trial of the case.14 This rule, however, admits of exceptions.For one, the 3. Conducting an actual ocular inspection of the lot;
findings of fact of the CA will not bind the parties in cases where the inference made on the
evidence is mistaken, as here.15
4. Inquiring from the owners and possessors of adjoining lots with respect to the
true and legal ownership of the lot in question;
That being said, we now proceed to the core of the controversy.
5. Putting up of signs that said lot is being purchased, leased, or encumbered;
Precautionary measures for buyers of real property and
An innocent purchaser for value is one who buys the property of another without notice 6. Undertaking such other measures to make the general public aware that said
that some other person has a right to or interest in it, and who pays a full and fair price lot will be subject to alienation, lease, or encumbrance by the parties.
atthe time of the purchase or before receiving any notice of another persons claim. 16 As
such, a defective title or one the procurement of which is tainted with fraud and In the case at bar, Bolos certificate of title was concededly free from liens and
misrepresentationmay be the source of a completely legal and valid title, provided that encumbrances on its face. However, the failure of Carlos and the spouses Guevara to
the buyer is an innocent third person who, in good faith, relied on the correctness of the exercise the necessary level ofcaution in light of the factual milieu surrounding the
certificate of title, or an innocent purchaser for value. 17
sequence of transfers from Bolos to respondents bars the application of the mirror doctrine
and inspires the Courts concurrence withpetitioners proposition.
Complementing this is the mirror doctrine which echoes the doctrinal rule that every
person dealing with registered land may safely rely on the correctness of the certificate of Carlos is not an innocent purchaser for value
title issued therefor and is in no way obliged to go beyond the certificate to determine the
condition of the property.18 The recognized exceptions to this rule are stated as follows:
Foremost, the Court is of the view that Bernardo negotiated with Bolos for the property as
Carlos agent. This is bolstered by the fact that he was the one who arranged for the
[A] person dealing with registeredland has a right to rely on the Torrens certificate of title saleand eventual registration of the property in Carlos favor. Carlos testified during the
and to dispense with the need of inquiring further except when the party has actual
May 27, 2009 hearing:21
knowledge of facts and circumstances that would impel a reasonably cautious man to
make such inquiry or when the purchaser has knowledge of a defect or the lack of title in
his vendor or of sufficient facts to induce a reasonably prudent man to inquire into the Q: Are you privy with the negotiations between your father, Mr. Bernardo Hizon, and your
status of the title of the property in litigation. The presence of anything which excites or co-defendant, Marylou Bolos, the alleged seller?
arouses suspicion should then prompt the vendee to look beyond the certificate and
investigate the title of the vendor appearing on the face of said certificate. One who falls A: No, Maam.
within the exception can neither be denominated an innocent purchaser for value nor a
purchaser in good faith and, hence, does not merit the protection of the law. 19 (emphasis
added) Q: Do you remember having signed a Deed of Absolute Sale, dated August 12, 1999?
Thus, in Domingo Realty, Inc. v. CA,20 we emphasized the need for prospective parties to A: Yes, Maam.
a contract involving titled lands to exercise the diligence of a reasonably prudent person in
ensuring the legality of the title, and the accuracy of the metes and bounds of the lot Q: And, at that time that you have signed the Deed, was Marylou Bolos present?
embraced therein, by undertaking precautionary measures, such as:
A: No, Maam.
1. Verifying the origin, history, authenticity, and validity of the title with the Office
of the Register of Deeds and the Land Registration Authority;
Q: Who negotiated and arranged for the sale of the property between Marylou Bolos and
you? A: It was my father. (emphasis ours)
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Consistent with the rule that the principal is chargeable and bound by the knowledge of, or 1. Deed of Sale between Locsin and Bolos;
notice to, his agent received in that capacity, 22 any information available and known to
Bernardo is deemed similarly available and known to Carlos, including the following: 2. TCT No. 200074 issued in Bolos name;
1. Bernardo knew that Bolos, from whom he purchased the subject property, 3. TCT No. N-205332 in Carlos name;
never acquired possession over the lot. As a matter of fact, in his March 11, 2009
direct testimony,23 Bernardo admitted having knowledge of Acerons lot
possession as well as the compromise agreement between petitioner and 4. TCT No. N-237083 in the nameof the Sps. Guevara.
Aceron.
To bridge the gap in their documentary evidence, respondents proffer their own
2. Bolos purported Deed of Sale was executed on November 3, 1979 but the testimonies explaining the circumstances surrounding the alleged sale. 26 However, basic is
ejectment case commenced by Locsin against Aceron was in 1992, or thirteen the rule that bare and self-serving allegations, unsubstantiated by evidence, are not
(13)years after the property was supposedly transferred to Bolos. equivalent to proof under the Rules.27 As such, we cannot give credence to their
representations that the sale between them actually transpired.
3. The August 6, 1993 Judgment,24 issued by the MTC on the compromise
agreement between Locsin and Aceron, clearly stated therein that "[o]n August 2, Furthermore, and noticeably enough,the transfer from Carlos to the spouses Guevara was
1993,the parties [Aceron and Locsin] submitted to [the MTC] for approval a effected only fifteen(15) days after Locsin demanded the surrender of the property
Compromise Agreement dated July 28, 1993." It further indicated that "[Aceron] fromCarlos. Reviewing the timeline:
acknowledges [Locsins] right of possessionto [the subject property], being the
registered owner thereof." May 9, 2002: Locsins counsel sent a letter to Carlos, requesting that he return the
property to Locsin since the latters signature in the purported deed of sale between her
Having knowledge of the foregoing facts, Bernardo and Carlos, to our mind, should have and Bolos was a forgery.
been impelled to investigate the reason behind the arrangement. They should have been
pressed to inquire into the status of the title of the property in litigation in order to protect May 20, 2002:Carlos counsel replied to Locsins May 9, 2002 letter, claiming that Carlos
Carlos interest. It should have struck them as odd that it was Locsin, not Bolos, who was unaware of any defect or flaw in Bolos title, making him an innocent purchaserof the
sought the recovery of possession by commencing an ejectment case against Aceron, and subject property.
even entered into a compromiseagreement with the latter years afterthe purported sale in
Bolos favor. Instead, Bernardo and Carlos took inconsistent positions when they argued
for the validity of the transfer of the property in favor of Bolos, but in the same breath May 24, 2002: The Sps. Guevara allegedly purchased the property from Carlos.
prayed for the enforcement of the compromise agreement entered into by Locsin.
When Bernardo met with Locsinscounsel on June 13, 2002, and personally made a
At this point it is well to emphasize that entering into a compromise agreement is an act of commitment to comeup with a win-win situation for his son and Locsin, he knew fully well,
strict dominion.25 If Bolos already acquired ownership of the property as early as 1979, it too,that the property had already been purportedly transferred to his daughter and son-in-
should have been her who entered into a compromise agreement with Aceron in 1993, not law, the spouses Guevara, for he, no less, facilitated the same. This, to us, isglaring
her predecessor-in-interest, Locsin, who, theoretically, had already divested herself of evidence of bad faith and an apparent intention to mislead Locsin into believing that she
ownership thereof. could no longer recover the subject property.
The spouses Guevara are not innocent purchasers for value Also, the fact that Lourdes Guevara and Carlos are siblings, and that Carlos agent in his
dealings concerning the property is his own father, renders incredible the argument
thatLourdes had no knowledge whatsoever of Locsins claim of ownership atthe time of the
As regards the transfer of the property from Carlos to the spouses Guevara, We find the purported sale.
existence of the sale highly suspicious. For one, there is a dearth of evidence to support
the respondent spouses position that the sale was a bona fide transaction. Evenif we
repeatedly sift through the evidence on record, still we cannot findany document, contract, Indeed, the fact that the spouses Guevara never intended to be the owner in good faith
or deed evidencing the sale in favor of the spouses Guevara. The same goes for the and for value of the lot is further made manifest by their lack of interest in protecting
purported payment of the purchase price of the property in the amount of PhP 1.5 million in themselvesin the case. It does not even appear in their testimonies that they, at the very
favor of Carlos. As a matter of fact, the only documentary evidence that they presented least, intended to vigilantly protect their claim over the property and prevent Locsin take it
were as follows: away from them. What they did was to simply appoint Bernardo as their attorney-in-fact to
handle the situation and never bothered acquainting themselves with the developments in
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
the case.28 To be sure, respondent Jose Manuel Guevara was not even presented asa erase the fact that her property rights were unlawfully invaded by respondents, entitling her
witness in the case. to nominal damages.
There is also strong reason to believethat even the mortgage in favor of DCC was a mere As to the amount to be awarded, it bears stressing that the same is addressed to the
ploy tomake it appear that the Sps. Guevara exercised acts of dominion over the subject sound discretion ofthe court, taking into account the relevant circumstances. 34 Considering
property. This is so considering the proximity between the propertys registration in their the length of time petitioner was deprived of her property and the bad faith attending
names and its being subjected to the mortgage. Most telling is that the credit line secured respondents actuations in the extant case, we find the amount of seventy-five thousand
by the mortgage was never used by the spouses, resulting in the mortgages cancellation pesos (PhP 75,000) as sufficient nominal damages. Moreover, respondents should be held
and the exclusion of DCC as a party in Civil Case No. Q-02-47925.1wphi1 jointly and severally liable for the said amount, attorneys fees in the amount of an
additional seventy-fivethousand pesos (PhP 75,000), and the costs of the suit.
These circumstances, taken altogether, strongly indicate that Carlos and the spouses
Guevara failed to exercise the necessary level of caution expected of a bona fide buyer WHEREFORE, in light of the foregoing, the Petition is hereby GRANTED. The assailed
and even performed acts that are highly suspect. Consequently, this Court could not give Decision of the Court of Appeals dated June 6, 2012 in CA-G.R. CV No. 96659 affirming
respondents the protection accorded to innocent purchasers in good faith and for value. the Decision of the Regional Trial Court, Branch 77, Quezon City, in Civil Case No. Q-02-
47925; as well as its Resolution dated October 30, 2012, denying reconsideration thereof,
Locsin is entitled to nominal damages are hereby REVERSED and SET ASIDE. TCT No. N-200074 in the name of Marylou
Bolos, and the titles descending therefrom, namely, TCT Nos. N-205332 and N-237083 in
the name of Carlos Hizon, and the Spouses Jose Manuel & Lourdes Guevara,
We now delve into petitioners prayer for exemplary damages, attorneys fees, and costs of respectively, are hereby declared NULL and VOID. Respondents and all other persons
suit. Here, the Court notes that petitioner failed to specifically pray that moral damages be acting under their authority are hereby DIRECTED to surrender possession of the subject
awarded. Additionally, she never invoked any of the grounds that would have warranted property in favor of petitioner. Respondents Bernardo Hizon, Carlos Hizon, and the
the award of moral damages. As can be gleaned from the records, lacking from her spouses Jose Manuel and Lourdes Guevara shall jointly and severally pay petitioner PhP
testimony is any claim that she suffered any form of physical suffering, mental anguish, 75,000 as nominal damages, PhP 75,000 as attorney's fees, and costs of suit.
fright, serious anxiety, besmirched reputation, wounded feelings, moral shock, social
humiliation, or any other similar circumstance. 29 Thus, we are constrained to refrain from
The Register of Deeds of Quezon City is hereby ORDERED to (1) cancel TCT No. N-
awarding moral damages in favor of petitioner.
237083; (2) reinstate TCT No. RT-97467; and (3) reissue TCT No. RT-97467 in favor of
petitioner, without requiring from petitioner payment for any and all expenses in performing
In the same vein, exemplary damages cannot be awarded in favor of petitioner. Well- the three acts.
settled that this species of damages is allowed only in addition to moral damages such that
no exemplary damages can be awarded unless the claimant first establishes his clear right
to moral damages.30 Consequently, despite our finding that respondents acted in a SO ORDERED.
fraudulent manner, petitioners claim for exemplary damages is unavailing at this point.
In the case at bar, this Court recognizes that petitioner was unduly deprived of her
ownership rights overthe property, and was compelled to litigate for its recovery, for almost
ten (10) years. Clearly, this could have entitled her to actual or compensatory damages
had she quantified and proved, during trial, the amounts which could have accrued in her
favor, including commercial fruits such as reasonable rent covering the pendency of the
case. Nonetheless, petitioners failure to prove actual or compensatory damages does not
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
[G. R. No. 102377. July 5, 1996] August 3, 1982, a notice of levy on execution was issued on February 12, 1985. On
February 12, 1985, defendant sheriff Roberto Garcia of Quezon City presented said notice
of levy on execution before the Register of Deeds of Marikina and the same was annotated
at the back of TCT No. 79073 as Entry No. 123283.
ALFREDO SAJONAS and CONCHITA SAJONAS, petitioners, vs. THE COURT OF
APPEALS, DOMINGO A. PILARES, SHERIFF ROBERTO GARCIA OF When the deed of absolute sale dated September 4 1984 was registered on August 28,
QUEZON CITY and REGISTER OF DEEDS OF MARIKINA, respondents. 1985, TCT No. N-79073 was cancelled and in lieu thereof, TCT No. N-109417 was ssued
in the name of the Sajonas couple. The notice of levy on execution annotated by
defendant sheriff was carried over to the new title. On October 21, 1985, the Sajonas
DECISION couple filed a Third Party Claim with the sheriff of Quezon City, hence the auction sale of
the subject property did not push through as scheduled.
TORRES, JR., J.:
On January 10, 1986, the Sajonas spouses demanded the cancellation of the notice of
A word or group of words conveys intentions. When used truncatedly, its meaning
levy on execution upon defendant-appellant Pilares, through a letter to their lawyer, Atty.
disappears and breeds conflict. Thus, it is written - By thy words shalt thou be justified, and
Melchor Flores. Despite said demand, defendant-appellant Pilares refused to cause the
by thy words shalt thou be condemned. (Matthew, 12:37)
cancellation of said annotation. In view thereof, plaintiffs-appellees filed this complaint
Construing the new words of a statute separately is the raison detre of this appeal. dated January 11, 1986 on February 5, 1986.[1]
Essentially, the case before us is for cancellation of the inscription of a Notice of Levy
The Sajonases filed their complaint[2] in the Regional Trial Court of Rizal, Branch 71,
on Execution from a certificate of Title covering a parcel of real property. The inscription
against Domingo Pilares, the judgment creditor of the Uychocdes. The relevant portion of
was caused to be made by the private respondent on Transfer Certificate of Title No. N-
the complaint alleges:
79073 of the Register of Deeds of Marikina, issued in the name of the spouses Ernesto B.
Uychocde and Lucita Jarin, and was later carried over to and annotated on Transfer
Certificate of Title No. N-109417 of the same registry, issued in the name of the spouses 7. That at the time the notice of levy was annotated by the defendant, the Uychocde
Alfredo Sajonas and Conchita R. Sajonas, who purchased the parcel of land from the spouses, debtors of the defendant, have already transferred, conveyed and assigned all
Uychocdes, and are now the petitioners in this case. their title, rights and interests to the plaintiffs and there was no more title, rights or interests
therein which the defendant could levy upon;
The facts are not disputed, and are hereby reproduced as follows:
8. That the annotation of the levy on execution which was carried over to the title of said
On September 22, 1983, the spouses Ernesto Uychocde and Lucita Jarin agreed to sell a plaintiffs is illegal and invalid and was made in utter bad faith, in view of the existence of
parcel of residential land located in Antipolo, Rizal to the spouses Alfredo Sajonas and the Adverse Claim annotated by the plaintiffs on the corresponding title of the Uychocde
Conchita R. Sajonas on installment basis as evidenced by a Contract to Sell dated spouses;
September 22, 1983. The property was registered in the names of the Uychocde spouses
under TCT No. N-79073 of the Register of Deeds of Marikina, Rizal. On August 27, 1984,
the Sajonas couple caused the annotation of an adverse claim based on the said Contract 9. That a demand was made by the plaintiffs upon the defendant Domingo A. Pilares, to
to Sell on the title of the subject property, which was inscribed as Entry No. 116017. Upon cause the cancellation of the said notice of levy but the latter, without justifiable reason and
full payment of the purchase price, the Uychocdes executed a Deed of Sale involving the with the sole purpose of harassing and embarrassing the plaintiffs ignored and refused
property in question in favor of the Sajonas couple on September 4, 1984. The deed of plaintiffs demand;
absolute sale was registered almost a year after, or on August 28, 1985.
10. That in view of the neglect, failure and refusal of the defendant to cause the
Meanwhile, it appears that Domingo Pilares (defendant-appellant) filed Civil Case No. Q- cancellation of the notice of levy on execution, the plaintiffs were compelled to litigate and
28850 for collection of sum of money against Ernesto Uychocde. On June 25, 1980, a engage the services of the undersigned counsel, to protect their rights and interests, for
Compromise Agreement was entered into by the parties in the said case under which which they agreed to pay attorneys fees in the amount of P10,000 and appearance fees of
Ernesto Uychocde acknowledged his monetary obligation to Domingo Pilares amounting to P500 per day in court.[3]
P27,800 and agreed to pay the same in two years from June 25, 1980. When Uychocde
failed to comply with his undertaking in the compromise agreement, defendant-appellant Pilares filed his answer with compulsory counterclaim[4] on March 8, 1986, raising
Pilares moved for the issuance of a writ of execution to enforce the decision based on the special and affirmative defenses, the relevant portions of which are as follows:
compromise agreement, which the court granted in its order dated August 3,
1982. Accordingly, a writ of execution was issued on August 12, 1982 by the CFI of
10. Plaintiff has no cause of action against herein defendants;
Quezon City where the civil case was pending. Pursuant to the order of execution dated
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
11. Assuming, without however admitting that they filed an adverse claim against the xxx xxx xxx
property covered by TCT No. 79073 registered under the name of spouses Ernesto
Uychocde on August 27, 1984, the same ceases to have any legal force and effect (30) In view of the foregoing, the Court renders judgment in favor of the plaintiffs and against
days thereafter pursuant to Section 70 of P.D. 1529;
the defendant Pilares, as follows:
12. The Notice of Levy annotated at the back of TCT No. 79073 being effected pursuant to
1. Ordering the cancellation of the Notice of Levy on Execution annotated on Transfer
the Writ of Execution dated August 31, 1982, duly issued by the CFI (now RTC) of Quezon Certificate of Title No. N-109417.
City proceeding from a decision rendered in Civil Case No. 28859 in favor of herein
defendant against Ernesto Uychocde, is undoubtedly proper and appropriate because the
property is registered in the name of the judgment debtor and is not among those 2. Ordering said defendant to pay the amount of P5,000 as attorneys fees.
exempted from execution;
3. Dismissing the Counterclaim interposed by said defendant.
13. Assuming without admitting that the property subject matter of this case was in fact
sold by the registered owner in favor of the herein plaintiffs, the sale is the null and void Said defendant is likewise ordered to pay the costs.
(sic) and without any legal force and effect because it was done in fraud of a judgment
creditor, the defendant Pilares.[5]
Dissatisfied, Pilares appealed to the Court of Appeals [9], assigning errors on the part
of the lower court. The appellate court reversed the lower courts decision, and upheld the
Pilares likewise sought moral and exemplary damages in a counterclaim against the annotation of the levy on execution on the certificate of title, thus:
Sajonas spouses. The parties appeared at pre-trial proceedings on January 21,
1987,[6] after which, trial on the merits ensued.
WHEREFORE, the decision of the lower court dated February 15, 1989 is reversed and
The trial court rendered its decision on February 15, 1989.[7] It found in favor of the set aside and this complaint is dismissed.
Sajonas couple, and ordered the cancellation of the Notice of Levy from Transfer
Certificate of Title No. N-109417. Costs against the plaintiffs-appellees."[10]
The court a quo stated, thus:
The Sajonas couple are now before us, on a Petition for Review on Certiorari[11],
After going over the evidence presented by the parties, the court finds that although the praying inter alia to set aside the Court of Appeals decision, and to reinstate that of the
title of the subject matter of the Notice of Levy on Execution was still in the name of the Regional Trial Court.
Spouses Uychocde when the same was annotated on the said title, an earlier Affidavit of Private respondent filed his Comment[12] on March 5, 1992, after which, the parties
Adverse Claim was annotated on the same title by the plaintiffs who earlier bought said were ordered to file their respective Memoranda. Private respondent complied thereto on
property from the Uychocdes. April 27, 1994[13], while petitioners were able to submit their Memorandum on September
29, 1992.[14]
It is a well settled rule in this jurisdiction (Guidote vs. Maravilla, 48 Phil. 442) that actual
notice of an adverse claim is equivalent to registration and the subsequent registration of Petitioner assigns the following as errors of the appellate court, to wit:
the Notice of Levy could not have any legal effect in any respect on account of prior
I
inscription of the adverse claim annotated on the title of the Uychocdes.
THE LOWER COURT ERRED IN HOLDING THAT THE RULE ON THE 30-DAY PERIOD
xxx xxx xxx
FOR ADVERSE CLAIM UNDER SECTION 70 OF P.D. NO. 1529 IS ABSOLUTE
INASMUCH AS IT FAILED TO READ OR CONSTRUE THE PROVISION IN ITS
On the issue of whether or not plaintiffs are buyers in good faith of the property of the ENTIRETY AND TO RECONCILE THE APPARENT INCONSISTENCY WITHIN THE
spouses Uychocde even notwithstanding the claim of the defendant that said sale PROVISION IN ORDER TO GIVE EFFECT TO IT AS A WHOLE.
executed by the spouses was made in fraud of creditors, the Court finds that the evidence
in this instance is bare of any indication that said plaintiffs as purchasers had notice
II
beforehand of the claim of the defendant over said property or that the same is involved in
a litigation between said spouses and the defendant. Good faith is the opposite of fraud
and bad faith, and the existence of any bad faith must be established by competent THE LOWER COURT ERRED IN INTERPRETING SECTION 70 OF P.D. NO. 1529 IN
proof.[8] (Cai vs. Henson, 51 Phil 606) SUCH WISE ON THE GROUND THAT IT VIOLATES PETITIONERS SUBSTANTIAL
RIGHT TO DUE PROCESS.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Primarily, we are being asked to ascertain who among the parties in suit has a better execution on February 12, 1985, said adverse claim was already ineffective. It cannot be
right over the property in question. The petitioners derive their claim from the right of said that actual or prior knowledge of the existence of the adverse claim on the Uychocdes
ownership arising from a perfected contract of absolute sale between them and the title is equivalent to registration inasmuch as the adverse claim was already ineffective
registered owners of the property, such right being attested to by the notice of adverse when the notice of levy on execution was annotated. Thus, the act of defendant sheriff in
claim[15] annotated on TCT No. N-79073 as early as August 27, 1984. Private respondent annotating the notice of levy on execution was proper and justified.
on the other hand, claims the right to levy on the property, and have it sold on execution to
satisfy his judgment credit, arising from Civil Case No. Q-28850[16] against the Uychocdes, The appellate court relied on the rule of statutory construction that Section 70 is
from whose title, petitioners derived their own. specific and unambiguous and hence, needs no interpretation nor
Concededly, annotation of an adverse claim is a measure designed to protect the construction.[19] Perforce, the appellate court stated, the provision was clear enough to
interest of a person over a piece of real property where the registration of such interest or warrant immediate enforcement, and no interpretation was needed to give it force and
right is not otherwise provided for by the Land Registration Act or Act 496 (now P.D. 1529 effect. A fortiori, an adverse claim shall be effective only for a period of thirty (30) days
or the Property Registration Decree), and serves a warning to third parties dealing with from the date of its registration, after which it shall be without force and effect.Continuing,
said property that someone is claiming an interest on the same or a better right than that of the court further stated;
the registered owner thereof. Such notice is registered by filing a sworn statement with the
Register of Deeds of the province where the property is located, setting forth the basis of . . . clearly, the issue now has been reduced to one of preference- which should be
the claimed right together with other dates pertinent thereto. [17] preferred between the notice of levy on execution and the deed of absolute sale. The Deed
of Absolute Sale was executed on September 4, 1984, but was registered only on August
The registration of an adverse claim is expressly recognized under Section 70 of 28, 1985, while the notice of levy on execution was annotated six (6) months prior to the
P.D. No. 1529.* registration of the sale on February 12, 1985.
Noting the changes made in the terminology of the provisions of the law, private
respondent interpreted this to mean that a Notice of Adverse Claim remains effective only In the case of Landig vs. U.S. Commercial Co., 89 Phil 638 it was held that where a sale is
for a period of 30 days from its annotation, and does not automatically lose its force recorded later than an attachment, although the former is of an earlier date, the sale must
afterwards. Private respondent further maintains that the notice of adverse claim was give way to the attachment on the ground that the act of registration is the operative act to
annotated on August 27, 1984, hence, it will be effective only up to September 26, 1984, affect the land. A similar ruling was restated in Campillo vs. Court of Appeals (129 SCRA
after which it will no longer have any binding force and effect pursuant to Section 70 of 513).
P.D. No. 1529. Thus, the sale in favor of the petitioners by the Uychocdes was made in
order to defraud their creditor (Pilares), as the same was executed subsequent to their
xxx xxx xxx
having defaulted in the payment of their obligation based on a compromise agreement. [18]
The respondent appellate court upheld private respondents theory when it ruled: The reason for these rulings may be found in Section 51 of P.D. 1529, otherwise known as
the Property Registration Decree, which provides as follows:
The above stated conclusion of the lower court is based on the premise that the adverse
claim filed by plaintiffs-appellees is still effective despite the lapse of 30 days from the date Section 51. Conveyance and other dealings by the registered owner.- An owner of
of registration. However, under the provisions of Section 70 of P.D. 1529, an adverse claim registered land may convey, mortgage, lease, charge, or otherwise deal with the same in
shall be effective only for a period of 30 days from the date of its registration. The provision accordance with existing laws. He may use such forms of deeds, mortgages, leases or
of this Decree is clear and specific. other voluntary instruments as are sufficient in law. But no deed, mortgage, lease or other
voluntary instrument, except a will purporting to convey or affect registered land shall take
xxx xxx xxx effect as a conveyance or bind the land, but shall operate only as a contract between the
parties and as evidence of authority to the Register of Deeds to make registration.
It should be noted that the adverse claim provision in Section 110 of the Land Registration
Act (Act 496) does not provide for a period of effectivity of the annotation of an adverse The act of registration shall be the operative act to convey or affect the land in so far as
claim. P.D. No. 1529, however, now specifically provides for only 30 days. If the intention third persons are concerned, and in all cases under the Decree, the registration shall be
of the law was for the adverse claim to remain effective until cancelled by petition of the made in the office of the Register of Deeds for the province or city where the land
interested party, then the aforecited provision in P.D. No. 1529 stating the period of lies. (Italics supplied by the lower court.)
effectivity would not have been inserted in the law.
Under the Torrens system, registration is the operative act which gives validity to the
Since the adverse claim was annotated On August 27, 1984, it was effective only until transfer or creates a lien upon the land. A person dealing with registered land is not
September 26, 1984. Hence, when the defendant sheriff annotated the notice of levy on required to go behind the register to determine the condition of the property. He is only
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Land Titles and Deeds (Finals) 2017
charged with notice of the burdens on the property which are noted on the face of the his alleged right or interest, and how or under whom acquired, and a reference to the
register or certificate of title.[20] volume and page of the certificate of title of the registered owner, and a description of the
land in which the right or interest is claimed.
Although we have relied on the foregoing rule, in many cases coming before us, the
same, however, does not fit in the case at bar. While it is the act of registration which is the
operative act which conveys or affects the land insofar as third persons are concerned, it is The statement shall be signed and sworn to, and shall state the adverse claimants
likewise true, that the subsequent sale of property covered by a Certificate of Title cannot residence, and designate a place at which all notices may be served upon him. The
prevail over an adverse claim, duly sworn to and annotated on the certificate of title statement shall be entitled to registration as an adverse claim, and the court, upon a
previous to the sale.[21] While it is true that under the provisions of the Property petition of any party in interest, shall grant a speedy hearing upon the question of the
Registration Decree, deeds of conveyance of property registered under the system, or any validity of such adverse claim and shall enter such decree therein as justice and equity
interest therein only take effect as a conveyance to bind the land upon its registration, and may require. If the claim is adjudged to be invalid, the registration shall be cancelled. If in
that a purchaser is not required to explore further than what the Torrens title, upon its face, any case, the court after notice and hearing shall find that a claim thus registered was
indicates in quest for any hidden defect or inchoate right that may subsequently defeat his frivolous or vexatious, it may tax the adverse claimant double or treble the costs in its
right thereto, nonetheless, this rule is not absolute. Thus, one who buys from the discretion.
registered owner need not have to look behind the certificate of title, he is, nevertheless,
bound by the liens and encumbrances annotated thereon. One who buys without checking The validity of the above-mentioned rules on adverse claims has to be reexamined in
the vendors title takes all the risks and losses consequent to such failure. [22] the light of the changes introduced by P.D. 1529, which provides:
In PNB vs. Court of Appeals, we held that the subsequent sale of the property to the
De Castro spouses cannot prevail over the adverse claim of Perez, which was inscribed on Sec. 70 Adverse Claim- Whoever claims any part or interest in registered land adverse to
the banks certificate of title on October 6, 1958. That should have put said spouses on the registered owner, arising subsequent to the date of the original registration, may, if no
notice, and they can claim no better legal right over and above that of Perez. The TCT other provision is made in this decree for registering the same, make a statement in writing
issued in the spouses names on July, 1959 also carried the said annotation of adverse setting forth fully his alleged right or interest, and how or under whom acquired, a
claim. Consequently, they are not entitled to any interest on the price they paid for the reference to the number of certificate of title of the registered owner, the name of the
property.[23] registered owner, and a description of the land in which the right or interest is claimed.
Then again, in Gardner vs. Court of Appeals, we said that the statement of
The statement shall be signed and sworn to, and shall state the adverse claimants
respondent court in its resolution of reversal that until the validity of an adverse claim is
residence, and a place at which all notices may be served upon him. This statement shall
determined judicially, it cannot be considered a flaw in the vendors title contradicts the very
be entitled to registration as an adverse claim on the certificate of title. The adverse claim
object of adverse claims. As stated earlier, the annotation of an adverse claim is a
shall be effective for a period of thirty days from the date of registration. After the lapse of
measure designed to protect the interest of a person over a piece of real property, and
said period, the annotation of adverse claim may be cancelled upon filing of a
serves as a notice and warning to third parties dealing with said property that someone is
verified petition therefor by the party in interest: Provided, however, that after cancellation,
claiming an interest on the same or has a better right than the registered owner thereof. A
no second adverse claim based on the same ground shall be registered by the same
subsequent sale cannot prevail over the adverse claim which was previously annotated in
claimant.
the certificate of title over the property.[24]
The question may be posed, was the adverse claim inscribed in the Transfer Before the lapse of thirty days aforesaid, any party in interest may file a petition in the
Certificate of Title No. N-109417 still in force when private respondent caused the notice of Court of First Instance where the land is situated for the cancellation of the adverse claim,
levy on execution to be registered and annotated in the said title, considering that more and the court shall grant a speedy hearing upon the question of the validity of such
than thirty days had already lapsed since it was annotated? This is a decisive factor in the adverse claim, and shall render judgment as may be just and equitable. If the adverse
resolution of this instant case. claim is adjudged to be invalid, the registration thereof shall be ordered cancelled. If, in any
case, the court, after notice and hearing shall find that the adverse claim thus registered
If the adverse claim was still in effect, then respondents are charged with knowledge
was frivolous, it may fine the claimant in an amount not less than one thousand pesos, nor
of pre-existing interest over the subject property, and thus, petitioners are entitled to the
more than five thousand pesos, in its discretion. Before the lapse of thirty days, the
cancellation of the notice of levy attached to the certificate of title.
claimant may withdraw his adverse claim by filing with the Register of Deeds a sworn
For a definitive answer to this query, we refer to the law itself. Section 110 of Act 496 petition to that effect. (Italics ours)
or the Land Registration Act reads:
In construing the law aforesaid, care should be taken that every part thereof be given
Sec. 110. Whoever claims any part or interest in registered lands adverse to the registered effect and a construction that could render a provision inoperative should be avoided, and
owner, arising subsequent to the date of the original registration, may, if no other provision inconsistent provisions should be reconciled whenever possible as parts of a harmonious
is made in this Act for registering the same, make a statement in writing setting forth fully whole.[25] For taken in solitude, a word or phrase might easily convey a meaning quite
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
different from the one actually intended and evident when a word or phrase is considered be bound by such period as it would be inconsistent with the very authority vested in it. A
with those with which it is associated.[26] In ascertaining the period of effectivity of an fortiori, the limitation on the period of effectivity is immaterial in determining the validity or
inscription of adverse claim, we must read the law in its entirety. Sentence three, invalidity of an adverse claim which is the principal issue to be decided in the court
paragraph two of Section 70 of P.D. 1529 provides: hearing. It will therefore depend upon the evidence at a proper hearing for the court to
determine whether it will order the cancellation of the adverse claim or not. [30]
The adverse claim shall be effective for a period of thirty days from the date of registration. To interpret the effectivity period of the adverse claim as absolute and without
qualification limited to thirty days defeats the very purpose for which the statute provides
At first blush, the provision in question would seem to restrict the effectivity of the for the remedy of an inscription of adverse claim, as the annotation of an adverse claim is
adverse claim to thirty days. But the above provision cannot and should not be treated a measure designed to protect the interest of a person over a piece of real property where
separately, but should be read in relation to the sentence following, which reads: the registration of such interest or right is not otherwise provided for by the Land
Registration Act or Act 496 (now P.D. 1529 or the Property Registration Decree), and
serves as a warning to third parties dealing with said property that someone is claiming an
After the lapse of said period, the annotation of adverse claim may be cancelled upon filing interest or the same or a better right than the registered owner thereof.[31]
of a verified petition therefor by the party in interest.
The reason why the law provides for a hearing where the validity of the adverse
If the rationale of the law was for the adverse claim to ipso facto lose force and effect claim is to be threshed out is to afford the adverse claimant an opportunity to be heard,
after the lapse of thirty days, then it would not have been necessary to include the providing a venue where the propriety of his claimed interest can be established or
foregoing caveat to clarify and complete the rule. For then, no adverse claim need be revoked, all for the purpose of determining at last the existence of any encumbrance on
cancelled. If it has been automatically terminated by mere lapse of time, the law would not the title arising from such adverse claim. This is in line with the provision immediately
have required the party in interest to do a useless act. following:
A statutes clauses and phrases must not be taken separately, but in its relation to the
Provided, however, that after cancellation, no second adverse claim shall be registered by
statutes totality. Each statute must, in fact, be construed as to harmonize it with the pre-
the same claimant.
existing body of laws. Unless clearly repugnant, provisions of statutes must be
reconciled. The printed pages of the published Act, its history, origin, and its purposes may
be examined by the courts in their construction. [27] An eminent authority on the subject Should the adverse claimant fail to sustain his interest in the property, the adverse
matter states the rule candidly: claimant will be precluded from registering a second adverse claim based on the same
ground.
A statute is passed as a whole and not in parts or sections, and is animated by one It was held that validity or efficaciousness of the claim may only be determined by the
general purpose and intent. Consequently, each part or section should be construed in Court upon petition by an interested party, in which event, the Court shall order the
connection with every other part or section so as to produce a harmonious whole. It is not immediate hearing thereof and make the proper adjudication as justice and equity may
proper to confine its intention to the one section construed. It is always an unsafe way of warrant. And it is only when such claim is found unmeritorious that the registration of the
construing a statute or contract to divide it by a process of etymological dissection, into adverse claim may be cancelled, thereby protecting the interest of the adverse claimant
separate words, and then apply to each, thus separated from the context, some particular and giving notice and warning to third parties. [32]
meaning to be attached to any word or phrase usually to be ascertained from the
context.[28] In sum, the disputed inscription of adverse claim on the Transfer Certificate of Title
No. N-79073 was still in effect on February 12, 1985 when Quezon City Sheriff Roberto
Garcia annotated the notice of levy on execution thereto. Consequently, he is charged with
Construing the provision as a whole would reconcile the apparent inconsistency
knowledge that the property sought to be levied upon on execution was encumbered by an
between the portions of the law such that the provision on cancellation of adverse claim by
interest the same as or better than that of the registered owner thereof. Such notice of levy
verified petition would serve to qualify the provision on the effectivity period. The law, taken
cannot prevail over the existing adverse claim inscribed on the certificate of title in favor of
together, simply means that the cancellation of the adverse claim is still necessary to
the petitioners. This can be deduced from the pertinent provision of the Rules of Court, to
render it ineffective, otherwise, the inscription will remain annotated and shall continue as
wit:
a lien upon the property. For if the adverse claim has already ceased to be effective upon
the lapse of said period, its cancellation is no longer necessary and the process of
cancellation would be a useless ceremony.[29] Section 16. Effect of levy on execution as to third persons- The levy on execution shall
create a lien in favor of the judgment creditor over the right, title and interest of the
It should be noted that the law employs the phrase may be cancelled, which judgment debtor in such property at the time of the levy, subject to liens or encumbrances
obviously indicates, as inherent in its decision making power, that the court may or may then existing. (Italics supplied)
not order the cancellation of an adverse claim, notwithstanding such provision limiting the
effectivity of an adverse claim for thirty days from the date of registration. The court cannot
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
To hold otherwise would be to deprive petitioners of their property, who waited a long A purchaser in good faith and for value is one who buys property of another without
time to complete payments on their property, convinced that their interest was amply notice that some other person has a right to or interest in such property and pays a full and
protected by the inscribed adverse claim. fair price for the same, at the time of such purchase, or before he has notice of the claims
or interest of some other person in the property. [36] Good faith consists in an honest
As lucidly observed by the trial court in the challenged decision: intention to abstain from taking any unconscientious advantage of another. [37] Thus, the
claim of the private respondent that the sale executed by the spouses was made in fraud
True, the foregoing section provides that an adverse claim shall be effective for a period of of creditors has no basis in fact, there being no evidence that the petitioners had any
thirty days from the date of registration. Does this mean however, that the plaintiffs thereby knowledge or notice of the debt of the Uychocdes in favor of the private respondents, nor
lost their right over the property in question? Stated in another, did the lapse of the thirty of any claim by the latter over the Uychocdes properties or that the same was involved in
day period automatically nullify the contract to sell between the plaintiffs and the any litigation between said spouses and the private respondent. While it may be stated
Uychocdes thereby depriving the former of their vested right over the property? that good faith is presumed, conversely, bad faith must be established by competent proof
by the party alleging the same. Sans such proof, the petitioners are deemed to be
purchasers in good faith, and their interest in the subject property must not be disturbed.
It is respectfully submitted that it did not.[33]
At any rate, the Land Registration Act (Property Registration Decree) guarantees to
As to whether or not the petitioners are buyers in good faith of the subject property, every purchaser of registered land in good faith that they can take and hold the same free
the same should be made to rest on the findings of the trial court. As pointedly observed from any and all prior claims, liens and encumbrances except those set forth on the
by the appellate court, there is no question that plaintiffs-appellees were not aware of the Certificate of Title and those expressly mentioned in the ACT as having been preserved
pending case filed by Pilares against Uychocde at the time of the sale of the property by against it. Otherwise, the efficacy of the conclusiveness of the Certificate of Title which the
the latter in their favor. This was clearly elicited from the testimony of Conchita Sajonas, Torrens system seeks to insure would be futile and nugatory. [38]
wife of plaintiff, during cross-examination on April 21, 1988.[34]
ACCORDINGLY, the assailed decision of the respondent Court of Appeals dated
ATTY. REYES October 17, 1991 is hereby REVERSED and SET ASIDE. The decision of the Regional
Trial Court dated February 15, 1989 finding for the cancellation of the notice of levy on
Q - Madam Witness, when Engr. Uychocde and his wife offered to you and execution from Transfer Certificate of Title No. N-109417 is hereby REINSTATED.
your husband the property subject matter of this case, they showed you
the owners transfer certificate, is it not? The inscription of the notice of levy on execution on TCT No. N-109417 is hereby
CANCELLED.
A - Yes, sir.
Costs against private respondent.
Q - That was shown to you the very first time that this lot was offered to you for
sale? SO ORDERED.
A - Yes.
Q - After you were shown a copy of the title and after you were informed that
they are desirous in selling the same, did you and your husband decide
to buy the same?
A - No, we did not decide right after seeing the title. Of course, we visited...
Q - No, you just answer my question. You did not immediately decide?
A - Yes.
Q - When did you finally decide to buy the same?
A - After seeing the site and after verifying from the Register of Deeds in
Marikina that it is free from encumbrances, that was the time we decided.
Q - How soon after you were offered this lot did you verify the exact location
and the genuineness of the title, as soon after this was offered to you?
G.R. No. 142687 July 20, 2006 On July 13, 1992, a notice of levy with attachment on real property by virtue of a writ of
execution was annotated at the back of the certificate of title of the property in question.
SPOUSES FRANCISCO and BERNARDINA RODRIGUEZ, petitioners, The writ of execution was issued by Judge Salvador Abad Santos, Regional Trial Court of
Makati, Branch 65 in connection with Civil Case No. 88-2159 involving a claim by herein
vs.
HON. COURT OF APPEALS, SPOUSES CHRISTOPHER and MA. ANGELICA petitioners, Spouses Francisco and Bernardina Rodriguez, against respondents Calingo.
BARRAMEDA, and SPOUSES ANTONIO and MARIDEL CALINGO, respondents. Judge Abad Santos issued the writ in favor of petitioners Rodriguez. 6
On July 21, 1992, petitioners counsel, Atty. Nelson A. Loyola, sent a letter to respondents
DECISION
Barrameda inquiring about the basis of their occupation of the property in question.
PUNO, J.:
On August 21, 1992, respondents Barrameda remitted to respondents Calingo the amount
of P364,992.07 to complete the payment of the agreed purchase price. Respondents
This is a petition for review of the decision of the Court of Appeals dated September 7, Calingo acknowledged receipt of said amount and waived all their rights to the property in
1999 in CA-G.R. CV No. 48772 and its resolution dated March 31, 2000. The Court of favor of the Barrameda spouses. They also guaranteed that the property was clear and
Appeals reversed the decision of the Regional Trial Court of Makati in Civil Case No. 92- free from any liens and encumbrances, except the real estate mortgage assumed by
3524. respondents Barrameda.7
The facts show that herein respondent Spouses Antonio and Maridel Calingo (respondents On October 7, 1992, respondents Barrameda executed a joint affidavit stating that they are
Calingo) were the registered owners of a house and lot located at No. 7903 Redwood the owners of the property in question by virtue of a deed of sale with assumption of
Street, Marcelo Green Village, Paraaque, Metro Manila. The property was mortgaged to mortgage; that they registered an affidavit of adverse claim with the Register of Deeds of
the Development Bank of the Philippines, which mortgage was later absorbed by the Paraaque; that the Sheriff of the Regional Trial Court, Branch 65, Makati, Sheriff Manuel
Home Mutual Development Fund (HMDF) or Pag-ibig. C. Dolor, levied said property despite their adverse claim; and that they have acquired the
property long before the levy was made, and therefore, said levy was illegal. They served
On April 27, 1992, respondents Calingo and respondent Spouses Christopher and Ma. a copy of the affidavit on petitioners counsel, Atty. Loyola, who made a reply thereto on
Angelica Barrameda (respondents Barrameda) entered into a contract of sale with October 15, 1992.
assumption of mortgage where the former sold to the latter the property in question and
the latter assumed to pay the outstanding loan balance to the Development Bank of the In his letter to Christopher Barrameda dated October 15, 1992, Atty. Loyola pointed out
Philippines.1 Respondents Barrameda issued two checks in the amounts of P150,000.00 that the alleged deed of sale with assumption of mortgage was not registered with the
and P528,539.76, for which respondents Calingo issued a receipt dated April 24, 1992. 2 Register of Deeds and that the records of the HMDF show that the property is owned by
the Calingo spouses. He urged the Barrameda spouses to confer with the petitioners to
In a letter dated April 23, 1992, respondent Antonio S. Calingo informed HMDF/Pag-ibig amicably settle the controversy.8
about the sale of the property with assumption of mortgage. Said letter, however, together
with an affidavit by respondents Calingo, was served upon HMDF/Pag-ibig on October 2, On November 9, 1992, respondents Barrameda found a Notice of Sheriffs Sale posted on
1992.3 their front gate, announcing the auction sale of their house and lot on December 3, 1992 at
10:00 in the morning.9
On May 29, 1992, respondents Barrameda filed with the Register of Deeds of Paraaque
an affidavit of adverse claim on the property. The adverse claim was inscribed at the back On November 20, 1992, pursuant to Rule 39, Section 17 of the Revised Rules of Court,
of the certificate of title as Entry No. 3439. 4 respondents Barrameda served a Notice of Third Party Claim upon Sheriff Manuel C.
Dolor, accompanied by their affidavit of title.
On June 1, 1992, respondent Ma. Angelica Paez-Barrameda wrote HMDF, Mortgage and
Loans Division informing the office that they have purchased the subject property from the On December 2, 1992, respondents Barrameda filed with the Regional Trial Court of
Calingo spouses and that they filed a notice of adverse claim with the Register of Deeds of Makati a petition for quieting of title with prayer for preliminary injunction. The petition
Paraaque. They also sought assistance from said office as regards the procedure for the prayed, among others, that the execution sale of the property be enjoined, the notice of
full settlement of the loan arrearages and the transfer of the property in their names.5 levy and attachment inscribed on the certificate of title be cancelled, and that respondents
Barrameda be declared the lawful and sole owners of the property in question. 10
Respondents Barrameda moved into the property on June 2, 1992.
The trial court ruled in favor of herein petitioners and dismissed respondents Barramedas
petition for quieting of title. It ruled that the annotation of respondents Barramedas
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Land Titles and Deeds (Finals) 2017
adverse claim at the back of the certificate of title was insufficient to establish their claim same in accordance with existing laws. He may use such forms of deeds,
over the property. It said that respondents Barrameda, as buyers of the property, should mortgages, leases or other voluntary instruments as are sufficient in law. But no
have registered the title in their names. Furthermore, respondents Barramedas adverse deed, mortgage, lease, or other voluntary instrument, except a will
claim had lost its efficacy after the lapse of thirty days in accordance with the provisions of purporting to convey or affect registered land shall take effect as a
the Land Registration Act. The trial court also found that there was collusion between conveyance or bind the land, but shall operate only as a contract between
respondents Barrameda and respondents Calingo to transfer the property to defraud third the parties and as evidence of authority to the Register of Deeds to make
parties who may have a claim against the Calingos. 11 registration.
The Court of Appeals, however, reversed the decision of the trial court. Citing the ruling The act of registration shall be the operative act to convey or affect the land
in Sajonas v. Court of Appeals,12 the appellate court held that respondents Barramedas insofar as third persons are concerned, and in all cases under this Decree, the
adverse claim inscribed on the certificate of title was still effective at the time the property registration shall be made in the office of the Register of Deeds for the province
was levied on execution. It said: or city where the land lies. (emphasis supplied)
Therefore, the disputed inscription of adverse claim on TCT No. 83612/57286 It is admitted in this case that the deed of sale with assumption of mortgage was not
was still in effect on July 13, 1992 when the Rodriguezes caused the annotation registered, but instead, respondents Barrameda filed an affidavit of adverse claim with the
of the notice of levy on execution thereto. Consequently, they are charged with Register of Deeds. The question now is whether the adverse claim is sufficient to bind third
knowledge that the property sought to be levied upon on execution was parties such as herein petitioners.
encumbered by an interest the same as or better than that of the registered
owner thereof. Such notice of levy cannot prevail over the existing adverse claim In L.P. Leviste and Company, Inc. v. Noblejas,14 we explained when an inscription of an
inscribed on the certificate of title in favor of the Barramedas. xxx adverse claim is sufficient to affect third parties, thus:
The court held, therefore, that the notice of levy could not prevail over respondents The basis of respondent Villanuevas adverse claim was an agreement to sell
Barramedas adverse claim. executed in her favor by Garcia Realty. An agreement to sell is a voluntary
instrument as it is a wilful act of the registered owner. As such voluntary
Petitioners moved for a reconsideration of the appellate courts ruling, but the motion was instrument, Section 50 of Act No. 496 [now Presidential Decree No. 1529]
denied. expressly provides that the act of registration shall be the operative act to convey
and affect the land. And Section 55 of the same Act requires the presentation of
Hence, this petition. Petitioners essentially argue that the remedy of a petition for quieting the owners duplicate certificate of title for the registration of any deed or
of title was not available to respondents Barrameda as they did not have a valid title to the voluntary instrument. As the agreement to sell involves an interest less than an
property in question; that the affidavit of adverse claim inscribed by respondents estate in fee simple, the same should have been registered by filing it with the
Register of Deeds who, in turn, makes a brief memorandum thereof upon the
Barrameda at the back of the certificate of title was not sufficient to establish their claim to
the property; and there was collusion between respondents Barrameda and respondents original and owners duplicate certificate of title. The reason for requiring the
production of the owners duplicate certificate in the registration of a voluntary
Calingo.
instrument is that, being a wilful act of the registered owner, it is to be presumed
that he is interested in registering the instrument and would willingly surrender,
The principal issue that needs to be resolved in this case is whether respondents present or produce his duplicate certificate of title to the Register of Deeds in
Barramedas adverse claim on the property should prevail over the levy on execution order to accomplish such registration. However, where the owner refuses to
issued by another court in satisfaction of a judgment against respondents Calingo. surrender the duplicate certificate for the annotation of the voluntary
instrument, the grantee may file with the Register of Deeds a statement
We hold that it cannot. setting forth his adverse claim, as provided for in Section 110 of Act No.
496. In such a case, the annotation of the instrument upon the entry book is
sufficient to affect the real estate to which it relates, although Section 72 of Act
Respondents Barrameda anchor their claim on the property on the deed of sale with No. 496 imposes upon the Register of Deeds the duty to require the production
assumption of mortgage executed by them and respondents Calingo on April 27, 1992. by the [r]egistered owner of his duplicate certificate for the inscription of the
The Property Registration Decree13 requires that such document be registered with the adverse claim. The annotation of an adverse claim is a measure designed to
Register of Deeds in order to be binding on third persons. The law provides: protect the interest of a person over a piece of real property where the
registration of such interest or right is not otherwise provided for by the
Sec. 51. Conveyance and other dealings by registered owner. An owner of Land Registration Act, and serves as a notice and warning to third parties
registered land may convey, mortgage, lease, charge or otherwise deal with the dealing with said property that someone is claiming an interest on the
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
same or a better right than the registered owner thereof. (emphases IN VIEW WHEREOF, the petition is GRANTED. The assailed decision and resolution of
supplied) the Court of Appeals are SET ASIDE and the decision of the Regional Trial Court, Makati
in Civil Case No. 92-3524 is REINSTATED. No cost. SO ORDERED.
In the case at bar, the reason given for the non-registration of the deed of sale with
assumption of mortgage was that the owners duplicate copy of the certificate of title was in
the possession of HMDF. It was not shown, however, that either respondents Barrameda
or respondents Calingo exerted any effort to retrieve the owners duplicate copy from the
HMDF for the purpose of registering the deed of sale with assumption of mortgage. In fact,
the parties did not even seek to obtain the consent of, much less inform, the HMDF of the
sale of the property. This, despite the provision in the contract of mortgage prohibiting the G.R. No. 187824 November 17, 2010
mortgagor (respondents Calingo) from selling or disposing the property without the written
consent of the mortgagee.15 Respondents Calingo, as party to the contract of mortgage, FILINVEST DEVELOPMENT CORPORATION, Petitioner,
are charged with the knowledge of such provision and are bound to comply therewith. vs.
Apparently, there was haste in disposing the property that respondents Calingo informed GOLDEN HAVEN MEMORIAL PARK, INC., Respondent.
HMDF of the sale only on October 2, 1992 when they served a copy of their letter to said
office regarding the transfer of the property to respondents Barrameda. There was no
reason for the parties failure to seek the approval of the HMDF to the sale as it appears x - - - - - - - - - - - - - - - - - - - - - - -x
from the letter of respondent Angelica Paez-Barrameda to HMDF that they were ready to
pay in full the balance of the loan plus interest. What is more suspect is that the judgment G.R. No. 188265
against respondents Calingo ordering them to pay the petitioners the sum
of P1,159,355.90 was rendered on January 28, 1992, before the sale of the property on
GOLDEN HAVEN MEMORIAL PARK, INC. Petitioner,
April 27, 1992. We also find it unsettling that respondents Barrameda, without any
vs.
reservation or inquiry, readily remitted to respondents Calingo the full payment for the
FILINVEST DEVELOPMENT CORPORATION, Respondent.
property on August 21, 1992 despite knowledge of the levy on execution over the property
in July of the same year. Any prudent buyer of real property, before parting with his money,
is expected to first ensure that the title to the property he is about to purchase is clear and DECISION
free from any liabilities and that the sellers have the proper authority to deal on the
property. ABAD, J.:
Again, we stress that the annotation of an adverse claim is a measure designed to protect These cases are about which of two real estate developers, both buyers of the same
the interest of a person over a piece of property where the registration of such interest lands, acted in good faith and has a better title to the same.
or right is not otherwise provided for by the law on registration of real
property. Section 70 of Presidential Decree No. 1529 is clear:
The Facts and the Case
Sec. 70. Adverse claim. Whoever claims any part or interest in registered land
adverse to the registered owner, arising subsequent to the date of the original Petronila Yap (Yap), Victoriano and Policarpio Vivar (the Vivars), Benjamin Cruz (Cruz),
registration, may, if no other provision is made in this Decree for registering Juan Aquino (Aquino), Gideon Corpuz (Corpuz), and Francisco Sobremesana
the same, make a statement in writing setting forth his alleged right or interest, (Sobremesana), and some other relatives inherited a parcel of land in Las Pias City
and how or under whom acquired, a reference to the number of the certificate of covered by Transfer Certificate of Title (TCT) 67462 RT-1. Subsequently, the heirs had the
title of the registered owner, the name of the registered owner, and a description land divided into 13 lots and, in a judicial partition, the court distributed four of the lots as
of the land in which the right or interest is claimed. xxx follows: a) Lots 1 and 12 to Aquino; b) Lot 2 to Corpuz and Sobremesana; and (c) Lot 6 to
Yap, Cruz, and the Vivars. The other lots were distributed to the other heirs.
The deed of sale with assumption of mortgage executed by respondents Calingo and
Barrameda is a registrable instrument. In order to bind third parties, it must be registered On March 6, 1989 Yap, acting for herself and for Cruz and the Vivars, executed an
with the Office of the Register of Deeds. It was not shown in this case that there was agreement to sell Lot 6 in favor of Golden Haven Memorial Park, Inc. (GHM), payable in
justifiable reason why the deed could not be registered. Hence, the remedy of adverse three installments. On July 31, 1989 another heir, Aquino, acting for himself and for
claim cannot substitute for registration. Corpuz and Sobremesana, also executed an agreement to sell Lots 1, 2, and 12 in favor of
GHM, payable in the same manner. In both instances, GHM paid the first installment upon
execution of the contract.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
On August 4, 1989 GHM caused to be annotated a Notice of Adverse Claim on TCT 67462 Here, Filinvest was on notice that GHM had caused to be annotated on TCT 67462 RT-1,
RT-1. On September 20, 1989 the sellers of the four lots wrote GHM that they were still the mother title, as early as August 4, 1989 a notice of adverse claim covering Lot 6. This
working on the titling of the lots in their names and wanted to know if GHM was still notwithstanding, Filinvest still proceeded to buy Lots 1, 2, 6, and 12 on September 10,
interested in proceeding with their agreements. GHM replied in the affirmative on November 18, and December 29, 1989.
September 21, 1989 and said that it was just waiting for the sellers titles so it can pay the
second installments. Filinvest of course contends that, although the title carried a notice of adverse claim, that
notice was only with respect to seller Yaps interest in Lot 6 and it did not affect Lots 1, 2,
Sometime in August of 1989, Filinvest Development Corporation (Filinvest) applied for the 12, and the remaining interests in Lot 6. The Court disagrees.
transfer in its name of the titles over Lots 2, 4, and 5 but the Las Pias Register of Deeds
declined its application. Upon inquiry, Filinvest learned that Lot 8, a lot belonging to some The annotation of an adverse claim is intended to protect the claimants interest in the
other heir or heirs and covered by the same mother title, had been sold to Household property.1avvphi1 The notice is a warning to third parties dealing with the property that
Development Corporation (HDC), a sister company of GHM, and HDC held the owners someone claims an interest in it or asserts a better right than the registered owner. 5 Such
duplicate copy of that title. Filinvest immediately filed against HDC a petition for the notice constitutes, by operation of law, notice to the whole world.6 Here, although the
surrender and cancellation of the co-owners duplicate copy of TCT 67462 RT-1. Filinvest notice of adverse claim pertained to only one lot and Filinvest wanted to acquire interest in
alleged that it bought Lots 1, 2, 6, and 12 of the property from their respective owners as some other lots under the same title, the notice served as warning to it that one of the
evidenced by three deeds of absolute sale in its favor dated September 10, November 18, owners was engaged in double selling.
and December 29, 1989 and that Filinvest was entitled to the registrations of such sales.
What is more, upon inquiry with the Register of Deeds of Las Pias, Filinvest also learned
On January 14, 1991 GHM filed against the sellers and Filinvest a complaint for the that the heirs of Andres Aldana sold Lot 8 to HDC and turned over the co-owners
annulment of the deeds of sale issued in the latters favor before the Regional Trial Court duplicate copy of TCT 67462 RT-1 to that company which had since then kept the title.
(RTC) of Las Pias City in Civil Case 91-098. On March 16, 2006 the RTC rendered a
Filinvest (referred to below as FDC) admits this fact in its petition, 7 thus:
decision after trial, declaring the contracts to sell executed by some of the heirs in GHMs
favor valid and enforceable and the sale in favor of Filinvest null and void. Only Filinvest
appealed among the defendants. Sometime in August 1989, FDC applied with the Register of Deeds of Las Pias for the
transfer and registration of Lots 2, 4, and 5 in its name and surrendered the co-owners
duplicate copy of TCT No. (67462) RT-1 given to it by the Vivar family, but the Register of
On November 25, 2008 the Court of Appeals (CA) affirmed the RTC decision with respect Deeds of Las Pias City refused to do the transfer of title in the name of FDC and instead
to the validity of the contract to sell Lot 6 in GHMs favor. But the CA declared the
demanded from FDC to surrender as well the other co-owner's duplicate copy of TCT No.
contracts to sell Lots 1, 2, and 12 in GHMs favor void and the sale of the same lots in (67462) RT-1 which was issued to the heirs of Andres Aldana. Upon further inquiry, FDC
favor of Filinvest valid.
came to know that the heirs of Andres Aldana sold Lot 8 and delivered their co-owner's
duplicate copy of TCT No. (67462) RT-1 to Household Development Corporation, a sister
Both parties filed their petitions for review before this Court, Filinvest in G.R. 187824, and company of respondent GHMPI. FDC made representations to Household Development
GHM in G.R. 188265. Corporation for the surrender of said co-owner's duplicate copy of TCT No. (67462) RT-1
to the Register of Deeds of Las Pias City, but Household Development Corporation
The Issue Presented refused to do so.
The issue presented in these cases is whether or not the contracts to sell that the sellers Filinvests knowledge that GHM, a competitor, had bought Lot 6 in which Filinvest was
interested, that GHM had annotated an adverse claim to that Lot 6, and that GHM had
executed in GHMs favor covering the same lots sold to Filinvest are valid and enforceable.
physical possession of the title, should have put Filinvest on its toes regarding the
prospects it faced if it bought the other lots covered by the title in question. Filinvest should
The Courts Ruling have investigated the true status of Lots 1, 2, 6, and 12 by asking GHM the size and shape
of its interest in the lands covered by the same title, especially since both companies were
To prove good faith, the rule is that the buyer of registered land needs only show that he engaged in the business of developing lands. One who has knowledge of facts which
relied on the title that covers the property. But this is true only when, at the time of the sale, should have put him upon such inquiry and investigation cannot claim that he has acquired
the buyer was unaware of any adverse claim to the property. 1 Otherwise, the law requires title to the property in good faith as against the true owner of the land or of an interest in it.8
the buyer to exercise a higher degree of diligence before proceeding with his purchase. He
must examine not only the certificate of title, but also the sellers right and capacity to The Court upholds the validity of the contracts between GHM and its sellers. As the trial
transfer any interest in the property.2 In such a situation, the buyer must show that he court aptly observed, GHM entered into valid contracts with its sellers but the latter simply
exercised reasonable precaution by inquiring beyond the four corners of the title. 3 Failing in
these, he may be deemed a buyer in bad faith.4
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
and knowingly refused without just cause to honor their obligations. The sellers apparently FLOR MARTINEZ, represented by MACARIO MARTINEZ, G.R. No. 166536
had a sudden change of heart when they found out that Filinvest was willing to pay more. authorized representative and Attorney-in-Fact,
As to the award of exemplary damages, the Court sustains the CA ruling. This species of Petitioner,
damages is allowed only in addition to moral damages such that exemplary damages Present:
cannot be awarded unless the claimant first establishes a clear right to moral
damages.9 Here, since GHM failed to prove that it is entitled to moral damages, the RTCs
award of exemplary damages had no basis. But the grant of attorneys fees is proper. As
the RTC noted, this case has been pending since 1991, or for 19 years now. GHM was CARPIO,* J.,
forced to litigate and incur expenses in order to protect its rights and interests.
CORONA, J., Chairperson,
WHEREFORE, the Court GRANTS the petition in G.R. 188265 and DISMISSES the - versus -
petition in G.R. 187824. The Court likewise REVERSES and SETS ASIDE the decision of VELASCO, JR.,
the Court of Appeals dated November 25, 2008 in CA-G.R. CV 89448, and REINSTATES
the decision of the Regional Trial Court in Civil Case 91-098 dated March 16, 2006 with NACHURA, and
the MODIFICATION that the award of exemplary damages is DELETED.
PERALTA, JJ.
SO ORDERED.
February 4, 2010
x-----------------------------------------------------------------------------------------x
DECISION
PERALTA, J.:
Before us is a special civil action for certiorari under Rule 65 of the Rules of Court to annul
and set aside the Decision[1] dated August 12, 2004 and the Resolution[2] dated November
18, 2004 of the Court of Appeals (CA) in CA-G.R. CV No. 61591, which reversed and set
aside the Decision[3] dated April 15, 1998 and Order[4] dated August 11, 1998 of the
Regional Trial Court (RTC) of Pasig, Branch 267, in Special Civil Action No. 574.
Respondent Edilberto Brua was the registered owner of a parcel of land located in Deed of Sale with the Registry of Deeds of Rizal on October 24 1991, and a new TCT No.
Mandaluyong, Rizal, covered by Transfer Certificate of Title (TCT) No. 346026 of the 5204[10] was issued in the names of respondent Garcia and his wife. However, the
Registry of Deeds of Rizal, which is the subject matter of this case. The property was first annotations at the back of the previous title were carried over to the new title, to wit: Entry
mortgaged to the Government Service Insurance System (GSIS), and such mortgage was No. 56837, a Notice of Levy on Attachment and/or Levy inscribed on January 8,
annotated at the back of TCT No. 346026 as Entry No. 91370, inscribed on June 5, 1981;[11] Entry No. 2881 showing a Notice of Levy on Execution in favor of petitioner Flor
1974.[5] On February 5, 1980,respondent Brua obtained a loan from his brother-in-law, Martinez, which was inscribed on July 11, 1988; [12] Entry No. 3706, which was a Certificate
respondent Ernesto Garcia, in the amount of One Hundred Fifty Thousand Pesos of Sale in favor of petitioner inscribed on September 2, 1988; [13] Entry No. 72854, which
(P150,000.00) and, to secure the payment of said loan, respondent Brua mortgaged the was a Notice of Levy on Execution in favor of Pilipinas Bank inscribed on December 8,
subjectproperty to respondent Garcia, as evidenced by a Deed of Real Estate 1981;[14] and Entry No. 16611 inscribed on October 24, 1991, which was the cancellation
Mortgage[6] executed in respondent Garcia's favor. Since the title to the subject property of respondent Brua's mortgage with GSIS.[15]
was in the possession of the GSIS and respondent Garcia could not register the Deed of
It appeared that the annotations found at the back of the title of the subject property in
Real Estate Mortgage, he then executed an Affidavit of Adverse Claim[7] and registered it
favor of petitioner, i.e., Notice of Levy on Attachment and/or Levy, Notice of Levy on
with the Registry of Deeds of Rizal on June 23, 1980 as Entry No. 49853/T-
Execution, and Certificate of Sale, were all made in connection with petitioner's action for
346026,[8] which remained uncanceled up to this time.
Collection of Sum of Money, which she filed against respondent Brua at the RTC of Makati
Sometime in October 1991, respondent Brua requested respondent Garcia to pay the City, Branch 60, docketed as Civil Case No. 39633. In that case, a decision was rendered
former's loan with the GSIS, so that the title to the subject property would be released to in favor of petitioner, where the RTC ordered respondent Brua to pay the former the
the latter. Respondent Garcia then paid GSIS the amount of P400,000.00 and, thus, the amount of P244,594.10, representing the value of the dishonored checks plus 12% interest
title to the subject property was released to him. per annum as damages and the premium paid by petitioner for the attachment bond. The
decision became final and executory as respondent Brua failed to appeal the same, and a
notice of levy on execution was issued. A public auction was subsequently conducted,
On October 22, 1991, a Deed of Absolute Sale[9] was executed between respondents where the subject property was awarded to petitioner as the sole bidder in the amount
Garcia and Brua over the subject property, where respondent Brua sold the property in the of P10,000.00, and a Certificate of Sale was issued in her favor.
amount of P705,000.00. In the same deed, it was stated that the subject property was only
The annotation of Pilipinas Bank's Notice of Levy on Execution annotated as Entry No.
a partial payment of respondent Brua's mortgage indebtedness to respondent Garcia,
72854 on the title of the subject property was by virtue of a civil case filed by Filipinas
which he could no longer redeem from the latter. Respondent Garcia then registered the
Manufacturers Bank, now known as Pilipinas Bank, against respondent Brua.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
On February 9, 1994, respondents Garcia and Brua filed with the RTC of Pasig, Branch Brua's title on January 8, 1981 and July 8, 1998, respectively, by virtue ofpetitioner being
267, an Action to Quiet Title, initially against petitioner due to the encumbrances/liens adjudged judgment creditor by Branch 60 of RTC Makati, respondent Garcia's claim
annotated on respondent Garcia's new title. They contended that these became inferior to that of petitioner. The RTC said that respondent Garcia's inaction to
encumbrances/liens were registered subsequent to the annotation of respondent Garcia's preserve his adverse claim as a second mortgagee, which was inscribed on June 23,
adverse claim made in 1980, and prayed that these be canceled. Subsequently, the 1980, and his sudden decision to redeem and purchase the subject property from the
complaint was amended to include Pilipinas Bank as an additional defendant. Petitioner GSIS in October 1991 -- when petitioner's Notice of Levy on Attachment and/or Levy,
and Pilipinas Bank filed their respective Answers thereto. Notice of Levy on Execution and Certificate of Sale were already inscribed at the back of
respondent Brua's title -- showed bad faith on the part of respondent Garcia; that
Trial thereafter ensued.
respondent Brua did not even testify or participate in the case, except when he was
On April 15, 1998, the RTC rendered its decision dismissing respondent Garcia's action for impleaded as a plaintiff in the case. The RTC did not give credit to respondent Garcia's
quieting of title, the dispositive portion of which reads: claim that he and respondent Brua had no prior knowledge of the occurrence of a public
WHEREFORE, PREMISES CONSIDERED, the instant auction and the consequent annotation of the certificate of sale, and found respondent
complaint is hereby dismissed for lack of merit and judgment is hereby
Garcia to be a buyer in bad faith of the subject property.
rendered in favor of defendants Flor Martinez and Pilipinas Bank as
against plaintiffs Ernesto Garcia and Edilberto Brua who are further
directed to pay both defendants attorney's fees in the amount
of P50,000.00 each.
Accordingly, the judicial inscriptions particularly, Entry No. The RTC also ruled that the Notice of Levy on Execution, which was annotated on
3706/T-346026, annotation of certificate of sale and Entry No. 72854/T-
December 8, 1981 as Entry No. 72854 on respondent Brua's title arising from Civil Case
346026 are held to be valid, subsisting liens which do not constitute a
cloud on Transfer Certificate of Title No. 5204. [16] No. 7262 entitled Pilipinas Bank v. Edilberto Brua, was a valid levy on the subject property
in favor of Pilipinas Bank. The levy could not be canceled, as this would impair the interest
In so ruling, the RTC found that the adverse claim which respondent Garcia caused to be
of the bank which had been decided upon by a co-equal court. The RTC found that the
annotated on the previous title of the subject property, i.e, TCT No. 346026, on June 23,
sale between respondents appeared to be tainted with bad faith, which constrained
1980 was predicated on his interest as a mortgagee of a loan of P150,000.00, which he
petitioner and Pilipinas Bank from engaging the services of lawyers; thus, the award of
extended to respondent Brua; that respondent Garcia's adverse interest was merely that of
attorney's fees in the latter's favor.
a second mortgagee, as he was not yet the purchaser of the subject property as of said
date; that when the judicial liens, i.e., Notice of Levy on Attachment and/or Levy and
Respondents filed their appeal with the CA. However, respondent Brua failed to file his could not claim that she was a purchaser in good faith, since respondent Garcia's adverse
appellant's brief; thus, his appeal was considered abandoned and dismissed. Petitioner claim was entered on June 23, 1980, eight years ahead of petitioner's Certificate of Sale
and Pilipinas Bank filed their respective appellees' briefs. on September 2, 1988; that when the Notice of Levy on Execution in favor of Pilipinas
Bank was annotated on respondent Brua's title, the sheriff who caused the annotation was
On August 12, 2004, the CA reversed and set aside the RTC decision, the dispositive
charged with knowledge that the property sought to be levied upon on execution was
portion of which reads:
encumbered by an interest, which was the same if not better than that of the registered
WHEREFORE, the appealed Decision dated April 15, 1998 is
REVERSED and SET ASIDE. Granting the instant appeal, Entry No. owner thereof; and that such notice of levy could not prevail over the existing adverse
72854 (Notice of Levy on Execution in favor of Pilipinas Bank), Entry
claim of respondent Garcia inscribed on the title as can be deduced from Section 12, Rule
No. 2881 (Notice of Levy on Execution in favor of Flor Martinez) and
Entry No. 3706 (Certificate of Sale in favor of Flor Martinez) inscribed in 39 of the Rules of Court.
TCT No. 346026 and carried over to TCT No. 5204, are hereby
CANCELLED.[17]
The CA found that the RTC erred in concluding that respondent Garcia was a purchaser in
The CA said that a subsequent sale of property covered by a certificate of title cannot bad faith, since his adverse claim was entered in respondent Brua's title in 1980, and
prevail over an adverse claim, duly sworn to and annotated on the certificate of title respondent Garcia could not have foretold at the time he caused such annotation of
previous to the sale; that while one who buys a property from the registered owner need adverse claim that petitioner would purchase the same property eight years thereafter; and
not have to look behind the title, he is nevertheless bound by the liens and encumbrances that while good faith is presumed, bad faith must be established by competent proof by the
annotated thereon; and, thus, one who buys without checking the vendor's title takes all party alleging the same; and, thus, in the absence of respondent Garcia's bad faith, he is
the risks and losses consequent to such failure. The CA found that in order to protect his deemed to be a purchaser in good faith, and his interest in the property must not be
interest, respondent Garcia executed an Affidavit of Adverse Claim on June 23, 1980, disturbed.
annotated it on the title of the subject property under Entry No. 49853 and it has remained
The CA also found that a Notice of Adverse Claim remains valid even after the lapse of 30
uncanceled up to this time; that such adverse claim was registered prior to the inscription
days, as provided for in Sec. 70 of Presidential Decree No. (PD) 1529 pursuant to our
of the Certificate of Sale in favor of petitioner under Entry No. 3706 and Pilipinas Bank's
ruling in Sajonas v. CA; that since no petition was filed by petitioner for the cancellation
Notice of Levy on Execution under Entry No. 72854; that the prior registration of
of respondent Garcia's Notice of Adverse Claim, the adverse claim subsisted and his
respondent Garcia's adverse claim effectively gave petitioner and Pilipinas Bank notice
rights over the subject property must consequently be upheld.
of the former's right to the subject property and, thus, petitioner was deemed to have
knowledge of respondent Garcia's claim and could not be considered as a buyer in good Petitioners motion for reconsideration was denied by the CA in a Resolution dated
faith at the time she purchased the subject property in the public auction; that petitioner November 18, 2004.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
September 2, 1988, which necessarily included the adverse claim of respondent Garcia in
of discretion amounting to lack or excess of jurisdiction committed by the CA in issuing its In his Comment, respondent Garcia claims that the petition faces outright dismissal,
assailed decision and resolution. since the appropriate remedy of the petitioner should have been a petition for review under
Rule 45 which had already lapsed; that when the CAreversed the RTC decision, such
Petitioner contends that respondent Garcia's adverse claim is nothing but a notice that he
action did not constitute grave abuse of discretion since it had legal basis; that any lien or
has an interest adverse to that of respondent Brua to the extent of P150,000.00, which
adverse claim earlier inscribed prevails over those liens or adverse claims inscribed
was the amount of the loan secured by a Deed of Real Estate Mortgage executed by
subsequent thereto.
respondent Brua in favor of respondent Garcia; that the adverse claim cannot be said to be
superior to a final sale conducted by the sheriff by authority of the court pursuant to a Respondent Brua did not file his comment. Thus, we dispensed with the filing of the
judgment that has attained finality; that Sajonas v. CA, on which the CA anchored its same in a Resolution dated June 19, 2006.
decision, differs from this case, since the adverse claim made in the title by therein
Petitioner filed her Reply, arguing that a petition for certiorari may be availed of where
petitioner Sajonas was by virtue of a contract to sell; that unlike in this case, respondent
appeal is inadequate and ineffectual.
Garcia caused the annotation of his adverse claim as a mortgagee of respondent Brua in
the amount of P150,000.00 in 1980; and respondent Garcia's payment of the GSIS loan in The parties submitted their respective memoranda as required in Our Resolution dated
1991, upon the request of respondent Brua, was presumably for the reason that August 30, 2006.
respondent Brua could no longer discharge the GSIS obligation; and to avoid the
We dismiss the petition.
foreclosure of the property by the GSIS, respondent Brua asked Garcia to redeem it; that
respondent Garcia's adverse claim in 1980 was not as a vendee of the property like Petitioner should have filed a petition for review under Rule 45 of the Rules of Court
in Sajonas, but merely as a mortgagee. instead of a petition for certiorari under Rule 65, since she is assailing the CA decision and
resolution which are final judgments. Rule 45 clearly provides that decisions, final orders or
resolutions of the CA in any case, i.e., regardless of the nature of the action or
Petitioner admits that respondent Garcia, as a mortgagee on the basis of which an proceedings involved, may be appealed to us by filing a petition for review, which is just a
adverse claim was inscribed on the title of the subject property, is protected by Sec. 12, continuation of the appellate process over the original case. [18] And the petition for review
Rule 39 of the Rules of Court; and, thus, petitioner knows that she is obliged as a vendee must be filed within fifteen (15) days from notice of the judgment or final order or resolution
in the public sale to pay liens and encumbrances then existing at the time of the sale on
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Land Titles and Deeds (Finals) 2017
appealed from, or of the denial of petitioner's motion for a new trial or reconsideration filed (3) when the writs issued are null; (4) when the questioned order amounts to an
in due time after notice of the judgment.[19] oppressive exercise of judicial authority, [25] which we find to be not present in this
case. Notably, petitioner did not even fail to advance an explanation why appeal was not
In this case, petitioner received a copy of the CA Resolution denying her motion for availed of, nor was there any showing that the issue raised in the petition
reconsideration on November 24, 2004; and, thus, under Rule 45, she has 15 days from for certiorari could not be raised on appeal. Concomitant to a liberal application of the rules
receipt of such resolution, or until December 9, 2004, to file a petition for review. However, of procedure should be an effort on the part of the party invoking liberality to adequately
petitioner did not file a petition for review; instead, she filed a petition for certiorari under explain his failure to abide by the rules. [26]
Rule 65 on January 24, 2005.[20] Hence, the CA decision and resolution have already
In fact, the argument raised by petitioner, i.e., that the Court of Appeals had no legal
A petition for certiorari under Rule 65 is proper if a tribunal, a board or an officer exercising authority to vary the findings of the trial court and substitute its own conclusion, which
judicial or quasi-judicial functions has acted without or in excess of jurisdiction or with were patently contrary to the trial court's findings, and conclusion, relates to the wisdom
grave abuse of discretion amounting to lack or excess of jurisdiction and there is no and soundness of the assailed CA decision and resolution. Where the issue or question
appeal, or any plain, speedy and adequate remedy in the ordinary course of law. [21] In this involved affects the wisdom or legal soundness of the decision not the jurisdiction of the
case, petitioner had the remedy of appeal, and it was the speedy and adequate remedy in court to render said decision the same is beyond the province of a special civil action
the ordinary course of law. Thus, a special civil action for certiorari cannot be used as a for certiorari.[27] Erroneous findings and conclusions do not render the appellate court
substitute for an appeal that the petitioner has already lost. Certiorari cannot be allowed vulnerable to the corrective writ of certiorari, for where the court has jurisdiction over the
when a party to a case fails to appeal a judgment to the proper forum despite the case, even if its findings are not correct, these would, at the most, constitute errors of law
availability of that remedy, certiorari not being a substitute for a lost appeal.[22] Certiorari and not abuse of discretion correctible by certiorari.[28] For if every error committed by the
will not be a cure for failure to timely file a petition for review on certiorari under Rule 45.[23] trial court or quasi-judicial agency were to be the proper subject of review by certiorari,
While there are instances where the extraordinary remedy of certiorari may be resorted to then trial would never end, and the dockets of appellate courts would be clogged beyond
despite the availability of an appeal, the long line of decisions denying the special civil measure.[29]
action for certiorari, either before appeal was availed of or in instances where the appeal
period had lapsed, far outnumber the instances where certiorari was given due Even if we consider this petition for certiorari under Rule 65, it must be shown that the CA
course.[24] The few significant exceptions are: (1) when public welfare and the committed grave abuse of discretion equivalent to lack or excess of jurisdiction, and not
advancement of public policy dictate; (2) when the broader interests of justice so require; mere errors of judgment, for the petition to be granted. [30] As we said, certiorari is not a
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Land Titles and Deeds (Finals) 2017
remedy for errors of judgment, which are correctible by appeal. By grave abuse of as or better than that of the registered owner thereof. [34] Thus, no grave abuse of discretion
discretion is meant such capricious and whimsical exercise of judgment as is equivalent to was committed by the CA when it held that the notice of levy and subsequent sale of the
lack of jurisdiction, and mere abuse of discretion is not enough -- it must be grave.[31] subject property could not prevail over respondent Garcia's existing adverse claim
subject property is but a notice that the latter has an interest adverse to respondent Brua's
The annotation of an adverse claim is a measure designed to protect the interest of a
title, to the extent of P150,000.00 secured by a real estate mortgage, and such
person over a piece of real property, where the registration of such interest or right is not
adverse claim cannot be considered superior to that of a final sale conducted by the sheriff
otherwise provided for by the Land Registration Act or Act No. 496 (now P.D. No.1529 or
by virtue of a court judgment that has attained finality.
the Property Registration Decree), and serves a warning to third parties dealing with said
Sec. 12, Rule 39 of the Rules of Court provides:
property that someone is claiming an interest on the same or a better right than that of the
SEC. 12. Effect of levy on execution as to third persons. The levy on
execution shall create a lien in favor of the judgment obligee over the registered owner thereof.[35]
right, title and interest of the judgment obligor in such property at the
time of the levy, subject to liens and encumbrances then existing.
Petitioner cannot be considered as a buyer in good faith. A purchaser in good faith and for
Clearly, the levy does not make the judgment creditor the owner of the property levied value is one who buys the property of another without notice that some other person has a
upon. He merely obtains a lien.[32] Such levy on execution is subject and subordinate to all right to or interest in such property and pays a full and fair price for the same at the time of
valid claims and liens existing against the property at the time the execution lien attached, such purchase, or before he has notice of the claims or interest of some other person in
such as real estate mortgages.[33] the property.[36] Here, petitioner admitted on cross-examination that when she registered
Respondent Garcia's adverse claim, which refers to the deed of mortgage executed by her notice of attachment in 1981 and the levy on execution on July 11, 1988, she already
respondent Brua in his favor, was annotated on respondent Brua's title registered with the saw respondent Garcia's adverse claim inscribed on respondent Brua's title on June 23,
Registry of Deeds of Rizal on June 23, 1980 as Entry No. 49853. The adverse claim was 1980.[37]
already existing when the Notice of Levy on Execution, as well as the Certificate of Sale in
favor of petitioner, was inscribed on July 11, 1988 and September 2, 1988, respectively; Petitioner claims that Sajonas v. CA[38] is not applicable, since the adverse claim registered
and, hence, the adverse claim is sufficient to constitute constructive notice to petitioner on the title of the subject property made by the Sajonases in 1984 was by virtue of a
regarding the subject property. When petitioner registered her Notice of Levy on Execution contract to sell, so that when the full purchase price was eventually paid on September 4,
on the title of the subject property, she was charged with the knowledge that the subject 1984, a deed of sale of the property was subsequently executed and registered in the
property sought to be levied upon on execution was encumbered by an interest the same Registry of Deeds of Marikina on August 28, 1985; that when the respondent therein
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Land Titles and Deeds (Finals) 2017
registered his notice levy on execution on February 12, 1985, such notice of levy could not
have precedence over the adverse claim, because there was no more property to levy As in that case, the adverse claim of respondent Garcia based on the Deed of Mortgage
upon. In this case, however, respondent Garcia caused the annotation of his adverse claim executed by respondent Brua over the subject land in the formers favor was existing when
only as a mortgagee of respondent Brua in the amount of P150,000.00 in 1980. The the Notice of Levy on Execution was inscribed in favor of petitioner. Although the deed of
subsequent deed of sale was executed in 1991 between respondents Garcia and Brua sale between respondents Brua and Garcia was done after the notice of levy on execution
after the former paid the latter's loan from with the GSIS.When a new title was issued in and certificate of sale were inscribed on the title, it was clearly stated in the deed that the
respondent Garcia's name, the notice of levy on execution and the certificate of sale were subject property was only a partial payment for respondent Brua's mortgage indebtedness
already annotated on the title of the subject property; and, thus, the sale in favor of to respondent Garcia, which the former could no longer redeem from the latter. Thus, the
respondent Garcia could not prevail over the previous auction sale in petitioner's favor. sale of the subject property by respondent Brua to respondent Garcia was by reason of
respondent Brua's prior loan from respondent Garcia, which was secured by a mortgage
We are not impressed. on the subject property; and this mortgage was registered and already existing on the title
of the subject property when the Notice of Levy on Execution and Certificate of Sale in
The issue posed in Sajonas was whether the adverse claim inscribed on TCT No. N- favor of petitioner were inscribed thereon. Thus, petitioner's claim over the subject property
190417 was still in force when private respondent therein caused the annotation of the must yield to the earlier encumbrance registered by respondent Garcia.
notice of levy on execution on the title; if the adverse claim was still in effect, then
respondent therein was charged with the knowledge of pre-existing interest over the WHEREFORE, the petition is DISMISSED. The Decision dated August 12, 2004 and
subject property and, thus, the Sajonases were entitled to the cancellation of the notice of Resolution dated November 18, 2004 of the Court of Appeals in CA-G.R. CV No. 61591
We ruled in Sajonas that the inscription of the adverse claim on the title of the subject
SO ORDERED.
property was still in effect on February 12, 1985, when the sheriff annotated the notice of
levy on execution in favor of respondent therein; that respondent therein was charged with
knowledge that the subject property sought to be levied upon on execution was
encumbered by an interest the same as or better than that of the registered owner thereof.
We then said that such notice of levy could not prevail over the existing adverse claim
PHILIPPINE PRODUCERS
COOPERATIVE MARKETING Respondent is a marketing cooperative which had a money claim against
ASSOCIATION, INC.,
Respondent. Promulgated:
petitioner.
July 15, 2005
x----------------------------------------------x
On April 24, 1987, respondent filed a civil case against petitioner for collection of
DECISION a sum of money in the Regional Trial Court of Bacolod City. [6] Despite receipt of summons
CORONA, J.:
on May 18, 1987, petitioner (then defendant) opted not to file an answer. [7] On March 3,
In implementing the involuntary transfer of title of real property levied and sold on 1988, respondent (then plaintiff) moved to have petitioner-defendant declared in default,
execution, is it enough for the executing party to file a motion with the court which which the trial court granted on April 15, 1988. [8] Respondent presented its evidence on
rendered judgment, or does he need to file a separate action with the Regional Trial October 9, 1989.[9] On November 28, 1989, the trial court rendered a decision in
Court? respondents favor.[10] Petitioner was furnished a copy of this decision by mail on November
This is a petition for review on certiorari [1] from a decision 29, 1989 but, because of his failure to claim it, the copy was returned. [11]
of the Court of Appeals in CA-G.R. CV No. 53085,[2] and its resolution denying
On May 31, 1990, the Court issued a writ of execution. On June 4, 1990, the
reconsideration,[3] both of which affirmed the orders of the Regional Trial Court of Bacolod
three lots (Lot 2904-A, Lot 2312-C-5 and Lot 2654), all of the Bago Cadastre and
The undisputed facts of the case follow.[5] Renato T. Arimas auctioned off the lots to satisfy the judgment, with respondent as the
only bidder. On July 10, 1990, ex-officio provincial sheriff and clerk of court Antonio Arbis
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executed a certificate of sale in favor of respondent. On August 13, 1990, the certificate of of the judgment was barred by prescription, given that the motion was filed more than 5
sale was recorded in the Register of Deeds.[12] years after the writ of execution was issued on March 23, 1990. [16] He also argues that
respondent failed to follow the correct procedure for the cancellation of a certificate of title
When petitioner failed to exercise his right of redemption within the 12-month
and the issuance of a new one, which is contained in Section 107 of PD 1529. [17]
period allowed by law, the court, on motion of respondent, ordered on February 5, 1992
the issuance of a writ of possession for the sheriff to cause the delivery of the physical In its comment,[18] respondent claims that the motion dated May 15, 1995 to
possession of the properties in favor of respondent. [13] direct the RD to issue new certificates of title was but a continuation of the series of events
that began with the decision in its favor on November 28, 1989, and from there, the auction
On May 17, 1995, respondent filed a motion to direct the Register of Deeds to
of the properties and the issuance of a certificate of sale in 1990.
issue new titles over the properties in its name, alleging that the Register of Deeds (RD) of
Bago City would not issue new titles (in respondents name) unless the owners copies were
The two principal issues for consideration are:
first surrendered to him. Respondent countered that such surrender was impossible
(1) whether or not respondents right to have new titles issued in its name is now
because this was an involuntary sale and the owners copies were with petitioner. [14]
barred by prescription and
On July 3, 1995, the trial court issued an order granting the motion. In a
(2) whether or not the motion in question is the proper remedy for cancelling
subsequent order dated August 8, 1995, it denied petitioners motion for reconsideration.
petitioners certificates of title and new ones issued in its name.
Petitioner appealed. Four years later, the Court of Appeals rendered the assailed decision
affirming the order of the trial court. On the first issue, we rule that the respondents right to petition the court for the
Petitioner contends that respondents motion for the RD to cancel the existing issuance of new certificates of title has not yet prescribed.
certificates of title and issue new ones in its name was in fact a real action and that the
In Heirs of Blancaflor vs. Court of Appeals, [19] Sarmiento Trading Corporation,
motion was procedurally infirm because respondent did not furnish him a copy. [15] He also
predecessor-in-interest of the private respondent Greater Manila Equipment Marketing
claims that under Section 6 of Rule 39 of the 1997 Rules of Civil Procedure, the execution
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Land Titles and Deeds (Finals) 2017
auctioned, Sarmiento Trading bid successfully and, in 1970, after the lapse of the one-year
In this case, the rule being invoked by petitioner [20] states:
redemption period, consolidated its ownership over the lot. SEC. 6. Execution by motion or by independent action.A final
and executory judgment or order may be executed on motion within
five (5) years from the date of its entry. After the lapse of such time,
Sarmiento Trading then filed a petition with the Court of First Instance to order and before it is barred by the statute of limitations, a judgment may be
enforced by action. The revived judgment may also be enforced by
motion within five (5) years from the date of its entry and thereafter by
the cancellation of Blancaflors title and the issuance of a new one in its name. In 1972, action before it is barred by the statute of limitations.
Sarmiento Trading sold the lot to private respondent which, at the time, went by the name
Rule 39 of the 1997 Revised Rules of Civil Procedure is misplaced. The fact of levy and
In 1988, the Deputy Register of Deeds of Iloilo wrote to Blancaflor requesting him
sale constitutes execution, and not the action for the issuance of a new title. Here,
to surrender his owners duplicate copy of the TCT. Blancaflor did not comply and the RD
because the levy and sale of the properties took place in June and July of 1990,
refused to issue a new title. On May 25, 1989, private respondent filed a petition in the
respectively, or less than a year after the decision became final and executory, the
Regional Trial Court praying that the petitioners be ordered to surrender the owners
respondent clearly exercised its rights in timely fashion.
duplicate copy of the title. The petitioners refused, claiming that respondents cause of
In addition, petitioner himself admits his failure to redeem the properties within
action had already prescribed. Ruling otherwise, we stated:
It is settled that execution is enforced by the fact of levy
and sale. The result of such execution salewith Sarmiento Trading the one-year period by adopting the facts stated in the Court of Appeals decision. [21] There
Corporation as the highest bidderwas that title to Lot No. 22 of TCT
No. 14749 vested immediately in the purchaser subject only to the
judgment debtors right to repurchase. Therefore, upon Sarmiento is thus no doubt he had been divested of his ownership of the contested lots.
Trading Corporations purchase of Lot No. 22 covered by TCT No.
14749 at the auction sale, private respondents successor-in-
interest had acquired a right over said title.
The right acquired by the purchaser at an execution sale is Respondents position hinges on petitioners failure to redeem the properties 12
inchoate and does not become absolute until after the expiration of the
redemption period without the right of redemption having been months after the certificate of sale was recorded in the Register of Deeds on August 13,
exercised. But inchoate though it be, it is like any other right, entitled to
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Land Titles and Deeds (Finals) 2017
1990. There is no uncertainty about respondents having become the new lawful owner of owners duplicate TCTs. This contention is incorrect. The proper course of action was to file
the lots in question by virtue of the levy and the execution sale. a petition in court, rather than merely move, for the issuance of new titles. This was the
procedure followed in Blancaflor by Sarmiento Trading which was in more or less the same
On the other hand, the issue of whether to acquire new titles by mere motion or
situation as the respondent in this case: [24]
through a separate petition is an entirely different matter.
Petitioners reliance on prescription and laches is unavailing
in this instance. It was proper for Sarmiento Trading Corporation to
file a petition with the Court of First Instance of Iloilo, acting as a
Petitioner is correct in assailing as improper respondents filing of a mere motion for the cadastral court, for the cancellation of TCT No. 14749 in the name of
Gaudencio Blancaflor and the issuance of another in its name. This is
cancellation of the old TCTs and the issuance of new ones as a result of petitioners refusal a procedure provided for under Section 78 of Act No. 496 and Section
75 of PD No. 1529
Regional Trial Court of Bacolod City ordering the Register of Deeds of Bago City to issue
reasons behind the law make a lot of sense; it provides due process to a registered
landowner (in this case the petitioner) and prevents the fraudulent or mistaken conveyance
RUBEN C. REYES, G.R. No. 185620
of land, the value of which may exceed the judgment obligation. Petitioner contends that Petitioner,
only his interest in the subject lots, and not that of his wife who was not a party to the suit,
Present:
should have been subjected to execution, and he should have had the opportunity to prove
Chairperson,
While we certainly will not condone any attempt by petitioner to frustrate the ends
BRION,
- versus -
of justice the only way to describe his refusal to surrender his owners duplicates of the
PEREZ,
certificates of title despite the final and executory judgment against him respondent, on SERENO, and
the other hand, cannot simply disregard proper procedure for the issuance to it of new REYES, JJ.
certificates of title. There was a law on the matter and respondent should have followed it.
In any event, respondent can still file the proper petition with the cadastral court Promulgated:
TANG SOAT ING (JOANNA TANG)
for the issuance of new titles in its name.
and ANDO G. SY,
December 14, 2011
Respondents.
WHEREFORE, the instant petition is hereby GRANTED. The decision of the
x-------------------------------------------------------------------------------------------x
Court of Appeals in CA-G.R. CV No. 53085 is hereby REVERSED. The order of the
DECISION
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Land Titles and Deeds (Finals) 2017
x x x [R]elief is owing to [MFR], but the grant thereof is rendered all the
more imperative in light of the manifestly injurious effects which the
business of [respondents] is causing to the neighboring estate, if not to
the entire locality. x x x By more than mere preponderance of evidence
PEREZ, J.:
has it been established that the gaseous by-products of the chemical
manufacturing process are outright pollutants which cause direct and
manifest harm to humans and animals alike, not to mention other living
things.
Challenged in this petition for review on certiorari under Rule 45 of the Rules of Court is xxxx
the Decision[1] of the Court of Appeals in CA-G.R. SP No. 96913 annulling and setting
WHEREFORE, judgment is hereby rendered: (a) ordering [respondents] to desist from the
aside the Orders[2] of the Regional Trial Court (RTC), Branch 7, Malolos, Bulacan which further conduct of industrial or commercial activities on the parcel of land covered by TCT
No. T-198753 of the Registry of Deeds of Bulacan, particularly the manufacture and
denied respondents Tang Soat Ings (Joanna Tangs) and Ando Sys Opposition (To MFR storage of chemicals thereat, including the construction of buildings intended for purposes
prohibited by the title to the property; (b) making permanent the injunctions issued by this
Farm, Inc.s Motion dated 25 April 2006) and Motion (To declare void the sale of the
Courts orders of May 3, 1982 and December 7, 1983; (c) ordering [respondents] to pay
property covered by TCT No. 198753) dated May 23, 2006. [MFR] actual damages in the amount of Six hundred Thirty-Nine Thousand Six hundred
Fifty (P639,650.00) Pesos, with legal rate of Twelve (12%) percent interest from the filing
of the complaint on January 15, 1982, until the same is fully paid; (d) ordering
The controversy arose from a complaint for Enforcement of Easement and Damages with [respondents] to pay [MFR] exemplary damages in the amount One Hundred Thousand
(P100,000.00) Pesos by way of example of correction for the public good; (e) ordering
Prayer for Preliminary Injunction and Restraining Order filed by MFR Farms, Inc. (MFR)
[respondents] to pay MFR attorneys fees in the amount of One Hundred Thousand
against respondents docketed as Civil Case No. 1245-M. MFR complained of respondents (P100,000.00) Pesos and to pay the costs of suit.[3]
commercial and industrial use of their property covered by Transfer Certificate of Title
On appeal by respondents docketed as CA G.R. CV No. 37808, the Court of
(TCT) No. T-198753, and sought the enforcement of the encumbrance contained in their
Appeals affirmed with modification the ruling of the RTC: the Court of Appeals reduced the
title. MFR likewise asked for the payment of damages suffered by its pig farm resulting
rate of interest to six percent (6%) and deleted the award of exemplary damages and
from respondents illegal use of their property.
attorneys fees.[4]
After trial, the RTC granted MFRs complaint and specifically held that:
MFR and respondents filed separate appeals by certiorari[5] to this Court
questioning the appellate courts ruling. Unfortunately for the parties, we dismissed both
x x x [Respondents] have defied the clear undertaking stated in the title appeals for late payment of legal fees and late filing of the petition. [6] By December 1,
to the subject property to limit the use thereof to purposes not
1997, the decision of the Court of Appeals in CA G.R. CV No. 37808 became final and
commercial or industrial in character. x x x [U]sing the land as a
chemical processing site and as a storage facility for chemicals is executory, and was recorded in the Book of Entries of Judgment. [7]
devoting it to industrial purposes, which is not allowed under the
subsisting encumbrance on the property.
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Land Titles and Deeds (Finals) 2017
about the papers he received. The caretaker also told the undersigned
On September 28, 1998, upon motion of MFR, the RTC issued a Writ of that he [did] not know what the lawyer said. [10]
Execution.[8] Pursuant thereto, the Branch Clerk of Court commanded the Sheriff of RTC,
A few days thereafter, on January 7, 1999, Sheriff Legaspi presented the Writ of
Branch 7, Malolos, Bulacan, Mr. Leovino Legaspi (Sheriff Legaspi), to execute the
Execution and the Notice of Levy on Execution of Real Property[11] covering TCT No. T-
Decision dated September 12, 1991 as modified by the Court of Appeals. [9] Sheriff Legaspi
198753 to the Register of Deeds of Bulacan Province.
was likewise ordered to accomplish a return of the proceedings taken thereon in
(d) The Bulletin Board of the main entrance of the Provincial Capitol
That on December 10, 1998[,] the undersigned went back to Tang Soat Building of Malolos, Bulacan; and
Ing at Tungkong Mangga, Sa Jose del Monte, Bulacan but said person
was not there and also Rodolfo Mendez was not around because he (e) The Posting Board of the Office of the Ex-Officio Sheriff located at
was in Manila; the back of the Bulwagan ng Katarungan Building, Malolos,
Bulacan.[14]
That on December 28, 1998[,] the undersigned went back to Tungkong On June 12, 19 & 26, 1999, the Notice of Sale on Execution of Real Property
Mangga, San Jose del Monte, Bulacan and talked to the caretaker[,]
was published in The Times Newsweekly.[15]
Rodolfo Mendez[,] and asked him what happened to the papers he
gave to [respondent] Tang Soat Ing. The caretaker said that
[respondent Tang Soat Ing] called his lawyer and informed [the latter]
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On July 19, 1999, at the public auction of the subject property covered by TCT No. T- Respondents failed to file an Answer or any responsive pleading to MFRs
198753, MFR was declared as the highest bidder. On even date, Sheriff Legaspi issued a Petition. Consequently, MFR moved to declare respondents in default. The Motion to
Certificate of Sale[16] which was registered with the Register of Deeds of Bulacan Province. Declare Respondents in Default was served on Atty. Sumawang on June 11, 2005.
After more than five (5) years, on September 17, 2004, with respondents failing to exercise The RTC granted MFRs Motion to Declare Respondents in Default: thereafter, MFR
their right of redemption, MFR filed a Motion[17] asking the RTC to issue an order directing presented evidence ex-parte.
the Register of Deeds of Bulacan Province to cancel TCT No. T-198753 in the name of
During presentation of evidence ex-parte, MFR filed a Motion for Substitution of Party
respondents, and issue a new certificate of title in the name of MFR.
Petitioner attaching thereto a Deed of Transfer of Interest declaring petitioner Ruben C.
On September 28, 2004, the RTC denied the Motion holding that a mere motion is not Reyes (Reyes) acquisition of MFRs rights over the subject property. On January 2, 2006,
sufficient for the cancellation of a certificate of title. The RTC ruled that under Section the RTC issued an Order granting this latest motion: MFR was substituted by Reyes as
107[18] of Presidential Decree No. 1529, the Property Registration Decree, a petition and a party-petitioner.
On December 1, 2004, MFR filed a Petition[19] in the same case, under the same docket
number, Civil Case No. 1245-M, before the same execution court. In this new petition, WHEREFORE, finding merit in the instant petition, the same is hereby
granted. Accordingly, defendant/private respondent Tang Soat Ing
MFR impleaded the Register of Deeds as additional defendant and prayed for the same
(Joanna Tang) is hereby directed to surrender to the Court her
reliefs as those prayed for in their previous motion with an additional prayer for the duplicate owners copy of TCT No. T-198753 within thirty (30) days from
receipt of this Order. In [the event said] defendant/private respondent
issuance of an order directing respondents to immediately surrender the Owners Duplicate fails to surrender such owners duplicate copy as directed hereinabove,
the Register of Deeds of Bulacan is hereby directed to cancel TCT No.
Copy of TCT No. T-198753.
T-198753 and issue in lieu thereof a new owners duplicate certificate of
title in the name of Ruben C. Reyes, who has substituted [MFR] by
On three separate occasions, December 9, 2004 and February 8 and 17, 2005, virtue of a Deed of Transfer of Interest and pursuant to the order of this
court dated January 02, 2006.[21]
respondents, through their counsel of record, Atty. T. J. Sumawang (Atty. Sumawang),
received a copy of the Petition.[20] Copies of the Order were separately served on Atty. Sumawang, Atty. Anacleto Diaz
was returned and rendered impossible. Apparently, Atty. Sumawang had already died in
December 2005.[23]
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Land Titles and Deeds (Finals) 2017
On April 27, 2006, Reyes filed another Motion praying that the Register of Deeds of Gaining no reprieve from the RTC, respondents filed a petition for certiorari before the
Bulacan Province be directed to cancel TCT No. T-198753 in the name of respondents Court of Appeals seeking to: (1) nullify the trial courts twin Orders dated July 17, 2006 and
and to issue a new one in his (Reyes) name. October 20, 2006, respectively; and (2) declare void the execution proceedings relating to
the sale of the subject property and the cancellation of TCT No. T-198753.
On May 19, 2006, new counsel for respondents entered its appearance. Forthwith, on May
23, 2006, respondents, through their new counsel, filed the previously adverted to In yet another turn of events, the appellate court annulled and set aside the July 17,
Opposition and Motion,[24] opposing Reyes April 27, 2006Motion and moving to declare 2006 and October 20, 2006 Orders of the RTC:
review of, or even reversal by another court of co-equal jurisdiction.[25] As regards the Aggrieved, Reyes filed a Motion for Reconsideration which resulted in another exchange of
motion to declare void the execution sale of the subject property covered by TCT No. T- pleadings between the parties. On December 9, 2008, the Court of Appeals denied the
198753, the RTC noted that there was substantial compliance with the requirements of motion.
[Section 15, Rule 39 of the Rules of Court evidenced] in the Sheriffs Report dated January
Hence, this impasse with the following issues for our resolution:
4, 1999, as well as the publication and posting requirements, extant in the records of this
case.[26] In conclusion, the RTC ruled that respondents are estopped from questioning the 1. Whether the execution sale of the subject property covered by TCT No. T-198753 is
proceedings, after keeping silent thereon for a long time, despite notice thereof. void;
Respondents filed a Motion for Reconsideration which the RTC denied in its Order 2. Proceeding from the validity of the execution sale and the consolidation of Reyes
dated October 20, 2006. ownership over the subject property, whether Section 107 of Presidential Decree No. 1529
contemplates the filing of a separate cadastral case before the RTC acting as a land
registration court.
comply with the requirements of Section 15, Rule 39 of the Rules of Court. The Court of
Defendants did not present evidence to rebut the no notice
Appeals relied on our holding in Villaceran v. Beltejar,[28] an administrative case finding
allegation of the plaintiff. Although in the defendant spouses
therein respondent Sheriff guilty of simple neglect of duty for failure to strictly comply with pre-trial brief, there is that general allegation that the auction
sale was made in accordance with law, however, there is no
the rules on execution sale. The Court of Appeals ruled that the deficiencies in the notice showing in the record that the requirements with respect to
publication/posting of notices were complied with by the
of execution sale were substantial and of such nature as to prevent the court from applying
defendants.
the presumption of regularity in the performance of official functions by Sheriff Legaspi at
the time of the execution sale. On this score, the Court of Appeals pointed out that it was
Deliberating on the absence of notice, the fact that the plaintiff
incumbent upon Reyes part to prove that the requirements of the law on execution sale did not come to know that Lot 12 was being subjected to an
auction sale proves two things: one, that no notice was posted
have been fully complied with.
in the place where the property is located [and, two, that]
there was no auction sale that took place on March 30, 1992.
We disagree. ...
Contrary to the Court of Appeals holding, the burden of evidence to prove lack of
Further, the defendants, particularly defendant sheriff, who is
compliance with Section 15, Rule 39 of the Rules of Court rests on the party claiming lack
the most competent person to testify that a written notice of
thereof i.e., respondents. sale was made and posted in accordance with law, was not
presented to the witness stand. Neither was a document
presented like Sheriffs Certificate of Posting to attest to the
In Venzon v. Spouses Juan,[29] we declared that the judgment debtor, as herein fact that a written notice of sale was posted before the
property was allegedly sold at public auction. In fact, the
respondents, alleging lack of compliance with the posting and publication requirements of
record is silent as (to) where the auction sale was conducted.
the auction sale in accordance with the rules, is behooved to prove such allegation. We
held, thus:
By ruling in the foregoing manner, the trial court
x x x. Whoever asserts a right dependent for its existence upon a incorrectly shifted the plaintiffs burden of proof to the
negative, must establish the truth of the negative by a defendants. It is true that the fact of posting and publication of the
preponderance of the evidence. This must be the rule, or it must notices is a matter peculiarly within the knowledge of the Deputy
follow that rights, of which a negative forms an essential element, Sheriff. However, the trial court did not acquire jurisdiction over
may be enforced without proof. Thus, whenever the [partys] right him, as he was not served with summons. At the time of the filing of
depends upon the truth of a negative, upon him is cast the onus the complaint, he was no longer connected with the Caloocan RTC,
probandi, except in cases where the matter is peculiarly within the Branch 126, which issued the writ of execution. Hence, he could not
knowledge of the adverse party. testify in his own behalf.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Respondents made no attempt to meet this burden of evidence, simply registry works as constructive notice to the whole world. [34] Section 51 of Act No. 496, as
maintaining lack of notice of the entire proceedings (execution and issuance of a new title amended by Section 52 of Presidential Decree No. 1529, provides:
over the subject property) before the trial court. SECTION 52. Constructive notice upon registration.Every
conveyance, mortgage, lease, lien, attachment, order, judgment,
instrument or entry affecting registered land shall, if registered, filed
We cannot subscribe to respondents belated posturing. The disputable or entered in the Office of the Register of Deeds for the province or
city where the land to which it relates lies, be constructive notice
presumption that official duty has been regularly performed was not overcome by
to all persons from the time of such registering, filing, or entering.
respondents.[31] The documents on record lead us to the inevitable conclusion that
respondents had constructive, if not actual, notice of the execution proceedings from the And, quite undeniably, respondents had constructive notice that their property is subject of
issuance of the Writ of Execution, the levy on the subject property,[32] its subjection to execution proceedings arising from their judgment debt and in danger of forfeiture to
execution sale, up to and until the proceedings in the RTC relating to the issuance of a their judgment creditor.
new certificate of title over the subject property. Certainly, respondents are precluded from
Respondents consistently flouted the judgment in Civil Case No. 1245-M, as
feigning ignorance of MFR (substituted by Reyes) staking a claim thereon.
amended by the Decision of the Court of Appeals in CA G.R. CV No. 37808, which
There was substantial compliance with Section 15, Rule 39 of the Rules of Court: became final and executory on December 1, 1997, by their utter failure to respond to the
the documents in support thereof, i.e., the Certificate of Posting issued by Sheriff Legaspi processes of the RTC in the execution proceedings despite their receipt of notice at each
and the Affidavit of Publication executed by the publisher of The Times Newsweekly, stage thereof. At the very least, respondents attack on the validity of the execution
appear to be in order.[33] In this case, the purpose of giving notice through posting and proceedings, culminating in the execution sale of the subject property, is barred by laches.
publication under Section 15(c) of the same ruleto let the public know of the sale to the end
Laches is the failure or neglect, for an unreasonable and unexplained length of
that the best price or a better bid may be made possible to minimize prejudice to the
time, to do that which by exercising due diligence could or should have been done earlier;
judgment debtorwas realized.
it is negligence or omission to assert a right within a reasonable time, warranting a
presumption that the party entitled to assert it either has abandoned it or declined to assert
We hearken to the time-honored rule anchored on public policy: which were duly received by Atty. Sumawang. Respondents Motion to nullify the execution
[R]elief will be denied to a litigant whose claim or demand has become proceedings, from the levy on the subject property and sale thereof, is an afterthought, a
"stale," or who has acquiesced for an unreasonable length of time, or
who has not been vigilant or who has slept on his rights either by last-ditch effort to evade payment of their judgment debt. Their claim of ignorance of the
negligence, folly or inattention. In other words, public policy requires, for execution proceedings flies in the face of the documents on record. This bare-faced claim
peace of society, the discouragement of claims grown stale for
non-assertion; thus laches is an impediment to the assertion or cannot trump the disputable presumption that a person takes ordinary care of his
enforcement of a right which has become, under the circumstances,
inequitable or unfair to permit.[37] (Emphasis supplied) concerns.[38] Consequently, respondents are estopped and barred from assailing the
Time and again, we have held that once a judgment becomes final and
The records bear out that as of October 9, 1998, and on two occasions
executory, the prevailing party should not be denied the fruits of his victory by some
thereafter, December 10 & 28, 1998, Sheriff Legaspi served a copy of the Writ of
subterfuge devised by the losing party.[39] We completely agree with the RTCs disquisition,
Execution on respondents, and followed up thereon. With no action forthcoming from
thus:
respondents, who are ostensibly evading payment of their judgment debt, the Sheriff
Finally, after [MFR] had filed the petition in question pursuant to and in
correctly levied on the subject property. For more than five (5) years from the execution
compliance with the order of this court dated September 28, 2004, to
sale thereof, with respondents not exercising their right of redemption, up to the filing of a which no answer or any responsive pleading was filed by respondents
or thru their lawyer, as the latter was certainly notified of the
Motion, and subsequently, a Petition for the issuance of a new certificate of title over the proceedings in said petition, respondents cannot now assail said
proceedings after keeping silent thereon for a long time, and if indeed
property in Reyes name, respondents made no effort to settle their judgment debt, much there was neglect on the part of their lawyer in informing them of or in
less, to ascertain the status of the execution proceedings against them and the levy on, taking part in said proceedings, such negligence of their counsel binds
them as client. There is likewise an evident lack of prudence and due
and consequent sale of, their property. Truly significant is the fact that eight (8) years had diligence on the part of the respondents by their failure to inform this
court of the withdrawal of their former counsel for a long period of time,
lapsed, from the time respondents received a copy of the Writ of Execution in October and they cannot now, by feigning ignorance of the proceedings had in
the petition in question, assail the same thru a new counsel. In other
1998 until they, through their new counsel, filed the Opposition and Motion in May 2006,
words, respondents cannot be allowed to keep silent on or refuse to
before respondents were prodded into action. participate in proceedings that they know were taking place in
connection with a final judgment rendered against them and then
suddenly, after said proceedings were long terminated, come to court to
We find obvious respondents brazen ploy to forestall and thwart the execution of question the same through a new counsel. The respondents are clearly
a final and executory judgment against them. The death of their counsel, Atty. Sumawang, in estoppel. Also, the court finds no practical purpose and benefit in
sustaining the theory posited by respondents which, aside from the
and their engagement of a new one, does not minimize the hard fact that respondents had reasons advanced earlier, will have no other effect than to further
unduly delay the execution of a judgment that had long acquired
notice of, not only the execution proceedings, but also, the proceedings on the issuance of finality.[40]
a new title over the subject property. Yet, respondents did not act on any of these notices
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
xxxx
Notwithstanding the validity of the execution sale and Reyes consolidation of
Respondents are clearly estopped from assailing the proceedings in
ownership over the subject property upon the lapse of the redemption period, we hold that
question by their failure or refusal to participate therein despite their or
their counsels knowledge thereof, and it would be unjust for the plaintiff Section 107 of Presidential Decree No. 1529 contemplates the filing of a separate and
to allow respondents to put in issue the validity of said proceedings at
this late stage, thru another counsel, as they are bound by the action or original action before the RTC, acting as a land registration court.
inaction of their former counsel.[41]
Reyes argues that to require him to file his petition in another court would unduly
The Court of Appeals reliance on Villaceran v. Beltejar[42] is
divest the RTC of its jurisdiction to enforce its final and executory decision. Reyes invokes
misplaced. Villaceran is an administrative case finding the Sheriff guilty of simple neglect
our ruling in Natalia Realty, Inc. v. Court of Appeals [44] where we declared that jurisdiction
of duty for failure to strictly comply with the rules on execution sale. We held therein that
of the court to execute its judgment continues even after the judgment has become final for
there was no substantial compliance by the Sheriff with Section 15(c), Rule 39 of the
the purpose of enforcement of judgment.[45]
Rules of Court. Our declaration that [n]o reason exists not to apply the principle in the
extrajudicial foreclosure sales of real property (statutory requirements of posting and Reyes reasoning is off tangent. Natalia is inapplicable because the execution
publication must be strictly complied with since non-compliance could constitute a proceedings in this case have been completed and was terminated upon the execution
jurisdictional defect that would invalidate the sale) to execution sales of real property under sale of the subject property. Reyes already consolidated ownership over the subject
Rule 39 of the Rules of Court[43] is an obiter which should not be definitive of the facts property; as owner, he has a right to have the same registered in his name. This transfer of
obtaining herein. title to the subject property in Reyes name is no longer part of the execution proceedings:
the fact of levy and sale constitutes execution, not so is the action for the issuance of a
The facts of this case demonstrate respondents stubborn refusal to comply with
new title.[46]
the judgment against them by claiming lack of notice of the execution proceedings. We
reiterate that this claim is belied by the evidence on record and cannot invalidate the Indeed, the subsequent filing of a separate and original action for the titling of the
enforcement and execution of a final and executory judgment of this Court. On the whole, subject property in Reyes name, no longer involves the execution of the judgment in Civil
respondents silence and inaction for eight (8) years from the time the subject property was Case No. 1245-M.
validly levied upon by the RTC, bars them from claiming invalidity of the execution
Section 107 of the Property Registration Decree falls under PETITIONS AND
proceedings.
ACTIONS AFTER ORIGINAL REGISTRATION, Chapter X thereof. The provision reads:
instrument which divests the title of the registered owner against his
consent or where a voluntary instrument cannot be registered by
reason of the refusal or failure of the holder to surrender the owner's Respondent alleges that it resorted to filing the contested
duplicate certificate of title, the party in interest may file a petition in motion because it could not obtain new certificates of title, considering
court to compel surrender of the same to the Register of Deeds. The that petitioner refused to surrender his owners duplicate TCTs. This
court, after hearing, may order the registered owner or any person contention is incorrect. The proper course of action was to file a
withholding the duplicate certificate to surrender the same, and direct petition in court, rather than merely move, for the issuance of new
the entry of a new certificate or memorandum upon such surrender. If titles. This was the procedure followed in Blancaflor by Sarmiento
the person withholding the duplicate certificate is not amenable to the Trading which was in more or less the same situation as the
process of the court, or if not any reason the outstanding owner's respondent in this case:
duplicate certificate cannot be delivered, the court may order the
annulment of the same as well as the issuance of a new certificate of
title in lieu thereof. Such new certificate and all duplicates thereof shall
contain a memorandum of the annulment of the outstanding duplicate. Petitioners reliance on prescription and laches is
unavailing in this instance. It was proper for Sarmiento
Trading Corporation to file a petition with the Court of
That a succeeding registration of property in anothers name, after its original First Instance of Iloilo, acting as a cadastral court, for the
cancellation of TCT No. 14749 in the name of Gaudencio
registration, contemplates a separate original action is reinforced by our ruling in Padilla v. Blancaflor and the issuance of another in its name. This is a
procedure provided for under Section 78 of Act No. 496 and
Philippine Producers Cooperative Marketing Association, Inc. [47] Answering the question:
Section 75 of PD No. 1529. . . .
In implementing the involuntary transfer of title of real property levied and sold on
execution, is it enough for the executing party to file a motion with the court which
Section 78 of Act 496 reads:
rendered judgment, or does he need to file a separate action with the Regional Trial Court,
xxxx
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Plainly, Reyes must institute a separate cadastral action initiated via petition.
WHEREFORE, the petition is PARTLY GRANTED. The Decision of the Court of Appeals
in CA G.R. SP No. 96913 annulling and setting aside the Orders dated July 17, 2006 and
October 20, 2006 issued by the Regional Trial Court, Branch 7, Malolos, Bulacan in Civil
[G.R. No. 136283. February 29, 2000] of the said companies. It was agreed that the bidder who acquires 51%
or more of the said companies shall be deemed the winner.
VIEWMASTER CONSTRUCTION CORPORATION, petitioner, vs. HON. REYNALDO Y.
MAULIT in his official capacity as administrator of the Land Registration Authority; "Defendant Allen Roxas, one of the stockholders of State Investment
and EDGARDO CASTRO, acting register of deeds of Las Pias, Metro Trust, Inc. applied for a loan with First Metro Investment, Inc. (First
Manila; respondents. Metro for brevity) in the amount of P36,500,000.00 in order to
participate in the bidding. Es msc
DECISION
"First Metro granted Allen Roxas' loan application without collateral
provided, however, that he procure a guarantor/surety/solidary co-
PANGANIBAN, J.:
debtor to secure the payment of the said loan.
A notice of lis pendens may be registered when an action or a proceeding directly affects
the title to the land or the buildings thereon; or the possession, the use or the occupation "Petitioner Viewmaster agreed to act as guarantor for the
thereof. Hence, the registration of such notice should be allowed if the litigation involves aforementioned loan in consideration for its participation in a Joint
the enforcement of an agreement for the co-development of a parcel of land. h Y Venture Project to co-develop the real estate assets of State
Investment Trust, Inc.
"On September 11,1995, petitioner Viewmaster filed a Notice of Lis Whether or not the petitioner failed to adequately describe the subject
Pendens with the Register of Deeds of Quezon City and Las Pias for property in its complaint and in the notice of lis pendens Mse sm
the annotation of a Notice of Lis Pendens on Transfer Certificate of Title
No. (S-17992) 12473- A, registered in the name of Peltan
II
Development, Inc. (now State Properties Corporation).
Whether or not the Las Pias property is directly involved in Civil Case
"In a letter dated September 15, 1995, the respondent Register of No. 65277."[9]
Deeds of Las Pias denied the request for annotation of the Notice of Lis
Pendens on the following grounds:
The Court's Ruling
1. the request for annotation and the complaint [do] not contain an
adequate description of the subject property; The Petition is meritorious.
2. petitioner's action only has an incidental effect on the property in First Issue: Description of Property
question. Esmso
Petitioner contends that the absence of the property's technical description in either the
"On September 20, 1995, petitioner filed an appeal to the respondent notice of lis pendens or the Complaint is not a sufficient ground for rejecting its application,
Land Registration Authority, which was docketed as Consulta No. 2381. because a copy of TCT No. (S-17992) 12473-A specifically describing the property was
attached to and made an integral part of both documents.
"On December 14, 1995, the Respondent Land Registration Authority
issued the assailed Resolution holding that petitioner's 'Notice of Lis On the other hand, respondents argue that petitioner failed to provide an accurate
Pendens' was not registrable."[7] description of the Las Pias property, which was merely referred to as a "parcel of land."
Ruling of the Court of Appeals The notice of lis pendens described the property as follows:
In affirming the ruling of the LRA, the Court of Appeals held that petitioner failed to "A parcel of land situated in the Barrio of Tindig na Manga, Municipality
adequately describe the subject property in the Complaint and in the application for the of Las Pias, Province of Rizal x x x containing an area of Seven
registration of a notice of lis pendens. The CA noted that while Transfer Certificate of Title Hundred Eighty Six Thousand One Hundred Sixty Seven (786,167)
No. (S-17992) 12473-A indicated six parcels of land, petitioner's application mentioned square meters, more or less."
only one parcel.
By itself, the above does not adequately describe the subject property, pursuant to Section
Moreover, the CA also ruled that a notice of lis pendens may be registered only when an 14 of Rule 13 of the Rules of Court and Section 76 of Presidential Decree (PD) No.1529. It
action directly affects the title to or possession of the real property. In the present case, the does not distinguish the said property from other properties similarly located in the Barrio
proceedings instituted by petitioner affected the title or possession incidentally only, not of Tindig na Manga, Municipality of Las Pias, Province of Rizal. Indeed, by the above
directly. description alone, it would be impossible to identify the property.
Hence, this Petition.[8] In the paragraph directly preceding the description quoted above, however, petitioner
specifically stated that the property referred to in the notice of lis pendens was the same
parcel of land covered by TCT No. (S-17992) 12473-A:
Issues
to State Properties Corporation, one of the [d]efendants in the aforesaid or notice stating the institution of such action or proceeding and the
case. The said parcel of land is more particu1arly described as court wherein the same is pending, as well as the date of the institution
follows: Ex sm thereof, together with a reference to the number of the certificate of title,
and an adequate description of the land affected and the registered
'A parcel of land situated in the Barrio of Tindig na owner thereof, shall have been filed and registered."
Manga, Municipality of Las Pias, Province of Rizal x
x x containing an area of Seven Hundred Eighty Six In Magdalena Homeowners Association, Inc. v. Court of Appeals, [12] the Court did not
Thousand One Hundred Sixty Seven (786,167) confine the availability of lis pendens to cases involving the title to or possession of real
square meters, more or less.' property. Thus, it held:
"Request is therefore made [for] your good office to record this notice of "According to Section 24, Rule 14[13] of the Rules of Court and Section
pendency of the aforementioned action in TCT No. (S-17992) 12473-A 76 of Presidential Decree No.1529, a notice of lis pendens is proper in
for all legal purposes."[10] the following cases, viz.:
As earlier noted, a copy of the TCT was attached to and made an integral part of both a).......An action to recover possession of real estate;
documents. Consequently, the notice of lis pendens submitted for registration, taken as a
whole, leaves no doubt as to the identity of the property, the technical description of which b).......An action to quiet title thereto;
appears on the attached TCT. We stress that the main purpose of the requirement that the
notice should contain a technical description of the property is to ensure that the same can
be distinguished and readily identified. In this case, we agree with petitioner that there was c).......An action to remove clouds thereon;
substantial compliance with this requirement.
d).......An action for partition; and
Second Issue: Property Directly Involved
e).......Any other proceedings of any kind in Court directly affecting the
In upholding the LRA, the Court of Appeals held that "the doctrine of lis pendens has no title to the land or the use or occupation hereof or the buildings
application to a proceeding in which the only object sought is the recovery of [a] money thereon."
judgment, though the title [to] or right or possession [of] a property may be incidentally
affected. It is thus essential that the property be directly affected where the relief sought in In Villanueva v. Court of Appeals,[14] this Court further declared that the rule of lis
the action or suit includes the recovery of possession, or the enforcement [thereof], or an pendens applied to suits brought "to establish an equitable estate, interest, or right in
adjudication between the conflicting claims of title, possession or right of possession to specific real property or to enforce any lien, charge, or encumbrance against it x x x."
specific property, or requiring its transfer or sale." [11] Thus, this Court observed that the said notice pertained to the following: Sjcj
On the other hand, petitioner contends that the civil case subject of the notice of lis "x x x all suits or actions which directly affect real property and not only
pendens directly involved the land in question, because it prayed for the enforcement of a those which involve the question of title, but also those which are
prior agreement between herein petitioner and Defendant Allen Roxas to co-develop the brought to establish an equitable estate, interest, or right, in specific
latter's property. real property or to enforce any lien, charge, or encumbrance against it,
there being in some cases a lis pendens, although at the
We agree with the petitioner. A notice of lis pendens, which literally means "pending suit," commencement of the suit there is no present vested interest, claim, or
may involve actions that deal not only with the title or possession of a property, but even lien in or on the property which it seeks to charge. It has also been held
with the use or occupation thereof. Thus, Section 76 of PD 1529 reads: Jjjuris to apply in the case of a proceeding to declare an absolute deed of
mortgage, or to redeem from a foreclosure sale, or to establish a trust,
or to suits for the settlement and adjustment of partnership interests."
"Sec. 76. Notice of lis pendens. -- No action to recover possession of
real estate, or to quiet title thereto, or to remove clouds upon the title
thereof, or for partition, or other proceedings of any kind in court directly In the present case, petitioner's Complaint docketed as Civil Case No. 65277 clearly
affecting the title to land or the use or occupation thereof or the warrants the registration of a notice of lis pendens. The Complaint prayed for the following
buildings thereon, and no judgment, and no proceeding to vacate or reliefs: Scjj
reverse any judgment, shall have any effect upon registered land as
against persons other than the parties thereto, unless a memorandum
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
"1. Render judgment ordering the Defendant Allen Roxas to sell fifty The Court must stress that the purpose of lis pendens is (1) to protect the rights of the
percent (50%) of his shareholdings in Defendant State Investment to party causing the registration thereof [18] and (2) to advise third persons who purchase or
Plaintiff at the price equivalent to the successful bid price per share plus contract on the subject property that they do so at their peril and subject to the result of the
an additional ten percent (10%) per share and directing Defendants to pending litigation.[19] One who deals with property subject of a notice of lis pendens cannot
co-develop with the Plaintiff the subject real properties; acquire better rights than those of his predecessors-in-interest.[20] In Tanchoco v.
Aquino,[21] the Court held:
2. Render judgment ordering the Defendant Allen Roxas to:
"x x x. _ The doctrine of lis pendens is founded upon reason of public
a. Pay the Plaintiff the amount of at least Twenty Million Pesos policy and necessity, the purpose of which is to keep the subject matter
(P20,000,000.00) and/or such other amounts as may be proven during of the litigation within the power of the court until the judgment or
the course of the trial, by way of actual damages; decree shall have been entered; otherwise, by successive alienations
pending the litigation, its judgment or decree shall be rendered abortive
and impossible of execution. Purchasers pendente lite of the property
b. Pay the Plaintiff the amount of at least One Million Pesos subject of the litigation after the notice of lis pendens is inscribed in the
(P1,000,000.00), by way of moral damages; Office of the Register of Deeds are bound by the judgment against their
predecessors. x x x."
c. Pay the Plaintiff the amount of at least One Million Pesos
(P1,000,000.00), by way of exemplary damages; Without a notice of lis pendens, a third party who acquires the property after relying only
on the Certificate of Title would be deemed a purchaser in good faith. Against such third
d. Pay the Plaintiff the amount of Two Hundred Fifty Thousand Pesos party, the supposed rights of petitioner cannot be enforced, because the former is not
(P250,000.00) by way of attorney's fees; and bound by the property owner's undertakings not annotated in the TCT. [22] Kyle
e. Pay expenses of litigation and costs of suit."[15] Likewise, there exists the possibility that the res of the civil case would leave the control of
the court and render ineffectual a judgment therein. Indeed, according to petitioner, it was
not even informed when Allen Roxas exchanged the Quezon City property for shares of
Undeniably, the prayer that Defendant Allen Roxas be ordered to sell 50 percent of his stock in Northeast Land Development, Inc. [23] Hence, it maintains that there is a clear risk
shareholdings in State Investment does not directly involve title to the property and is that the same thing would be done with the Las Pias property.
therefore not a proper subject of a notice of lis pendens. Neither do the various amounts of
damages prayed for justify such annotation.
In this light, the CA ruling left unprotected petitioner's claim of co-development over the
Las Pias property. Hence, until the conflicting rights and interests are threshed out in the
We disagree, however, with the Court of Appeals and the respondents that the prayer for civil case pending before the RTC, it will be in the best interest of the parties and the public
the co-development of the land was merely incidental to the sale of shares of defendant at large that a notice of the suit be given to the whole world.
company. Jjsc
The Court is not here saying that petitioner is entitled to the reliefs prayed for in its
The Complaint shows that the loan obtained by Allen Roxas (one of the defendants in the Complaint pending in the RTC. Verily, there is no requirement that the right to or the
civil case) from First Metro was guaranteed by petitioner for two distinct considerations: (a) interest in the property subject of a lis pendens be proven by the applicant. The Rule
to enable it to purchase 50 percent of the stocks that the said defendant may acquire in merely requires that an affirmative relief be claimed. [24] A notation of lis pendens neither
State Investment and (b) to co-develop with the defendants the Quezon City and the Las affects the merits of a case nor creates a right or a lien. [25] It merely protects the applicant's
Pias properties of the corporation. In other words, the co-development of the said rights, which will be determined during the trial.
properties is a separate undertaking that did not arise from petitioner's acquisition of the
defendant's shares in the corporation. To repeat, the co-development is not merely
auxiliary or incidental to the purchase of the shares; it is a distinct consideration for WHEREFORE, the Petition is hereby GRANTED and the assailed Decision of the Court of
Viewmaster's guaranty.[16] Appeals REVERSED and SET ASIDE. The Las Pias Register of Deeds is directed to
cause the annotation of lis pendens in TCT No. (S-17992) 12473-A. No costs.
Hence, by virtue of the alleged agreement with Allen Roxas, petitioner has a direct -- not
merely incidental -- interest in the Las Pias property. Contrary to respondents' SO ORDERED.
contention,[17] the action involves not only the collection of a money judgment, but also the
enforcement of petitioner's right to co-develop and use the property.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
[G.R. No. 148568. March 20, 2003] day contract period aggravated by defective workmanship and utilization of materials
which are not in compliance with specifications.
xxxxxxxxx
ATLANTIC ERECTORS, INC., petitioner, vs. HERBAL COVE REALTY
CORPORATION, respondent. On November 21, 1997, [petitioner] filed a complaint for sum of money with damages (Civil
Case No. 97-2707) with the Regional Trial Court of Makati entitled Atlantic Erectors,
DECISION Incorporated vs. Herbal Cove Realty Corp. and Ernest C. Escal[e]r. This case was raffled
to Branch 137, x x x Judge Santiago J. Ranada presiding. In said initiatory pleading,
PANGANIBAN, J.: [petitioner] AEI asked for the following reliefs:
The pendency of a simple collection suit arising from the alleged nonpayment of AFTER DUE NOTICE AND HEARING, to order x x x defendant to:
construction services, materials, unrealized income and damages does not justify the
annotation of a notice of lis pendens on the title to a property where construction has been 1. Pay plaintiff the sum of P4,854,229.94 for the unpaid construction services already
done. rendered;
2. To x x x pay plaintiff the sum of P1,595,551.00 for the construction materials, equipment
Statement of the Case and tools of plaintiff held by defendant;
3. To x x x pay plaintiff the sum of P2,250,000.00 for the [loss] x x x of expected income
Before the Court is a Petition for Review on Certiorari [1] under Rule 45 of the Rules of from the construction project;
Court, challenging the May 30, 2000 Decision[2] of the Court of Appeals (CA) in CA-GR SP
No. 56432. The dispositive portion of the Decision is reproduced as follows:
4. [T]o x x x pay plaintiff the sum of P800,000.00 for the cost of income by way of rental
from the equipment of plaintiff held by defendants;
WHEREFORE, the petition is granted and the assailed November 4, 1998 and October 22,
1999 orders annulled and set aside. The July 30, 1998 order of respondent judge is
5. To x x x pay plaintiff the sum of P5,000,000.00 for moral damages;
reinstated granting the cancellation of the notices of lis pendens subject of this petition. [3]
The factual antecedents of the case are summarized by the CA in this wise: On the same day of November 21, 1997, [petitioner] filed a notice of lis pendens for
annotation of the pendency of Civil Case No. 97-707 on titles TCTs nos. T-30228, 30229,
30230, 30231 and 30232. When the lots covered by said titles were subsequently
On June 20, 1996, [respondent] and [petitioner] entered into a Construction Contract subdivided into 50 lots, the notices of lis pendens were carried over to the titles of the
whereby the former agreed to construct four (4) units of [townhouses] designated as 16-A, subdivided lots, i.e., Transfer Certificate of Title Nos. T-36179 to T-36226 and T-36245 to
16-B, 17-A and 17-B and one (1) single detached unit for an original contract price T-36246 of the Register of Deeds of Tagaytay City.
of P15,726,745.19 which was late[r] adjusted to P16,726,745.19 as a result of additional
works. The contract period is 180 days commencing [on] July 7, 1996 and to terminate on
January 7, 1997. [Petitioner] claimed that the said period was not followed due to reasons On January 30, 1998, [respondent] and x x x Ernest L. Escaler, filed a Motion to Dismiss
attributable to [respondent], namely: suspension orders, additional works, force majeure, [petitioners] Complaint for lack of jurisdiction and for failure to state a cause of action. They
and unjustifiable acts of omission or delay on the part of said [respondent]. [Respondent], claimed [that] the Makati RTC has no jurisdiction over the subject matter of the case
however, denied such claim and instead pointed to [petitioner] as having exceeded the 180
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
because the parties Construction Contract contained a clause requiring them to submit pending. After a careful consideration of all matters relevant to the lis pendens, the Court
their dispute to arbitration. believes that justice will be better served by setting aside the Order of 30 July 1998.
xxxxxxxxx On November 27, 1998, [respondent] filed a Motion for Reconsideration of the November
4, 1998 Order arguing that allowing the notice of lis pendens to remain annotated on the
titles would defeat, not serve, the ends of justice and that equitable considerations cannot
On March 17, 1998, [RTC Judge Ranada] dismissed the Complaint as against
[respondent] for [petitioners] failure to comply with a condition precedent to the filing of a be resorted to when there is an applicable provision of law.
court action which is the prior resort to arbitration and as against x x x Escaler for failure of the
Complaint to state a cause of action x x x. xxxxxxxxx
[Petitioner] filed a Motion for Reconsideration of the March 17, 1998 dismissal On October 22, 1999, [Judge Ranada] issued an order denying [respondents] Motion for
order. [Respondent] filed its Opposition thereto. Reconsideration of the November 4, 1998 Order for lack of sufficient merit. [5]
On April 24, 1998, [respondent] filed a Motion to Cancel Notice of Lis Pendens. It argued Thereafter, Respondent Herbal Cove filed with the CA a Petition for Certiorari.
that the notices of lis pendens are without basis because [petitioners] action is a purely
personal action to collect a sum of money and recover damages and x x x does not directly
affect title to, use or possession of real property.
Ruling of the Court of Appeals
In his July 30, 1998 Order, [Judge Ranada] granted [respondents] Motion to Cancel Notice
of Lis Pendens x x x:
Setting aside the Orders of the RTC dated November 4, 1998 and October 22, 1999,
the CA reinstated the formers July 30, 1998 Order [6] granting Herbal Coves Motion to
[Petitioner] filed a Motion for Reconsideration of the aforesaid July 30, 1998 Order to which Cancel the Notice of Lis Pendens. According to the appellate court, the re-annotation of
[respondent] filed an Opposition. those notices was improper for want of any legal basis. It specifically cited Section 76 of
Presidential Decree No. 1529 (the Property Registration Decree). The decree provides that
In a November 4, 1998 Order, [Judge Ranada,] while finding no merit in the grounds raised the registration of such notices is allowed only when court proceedings directly affect the
by [petitioner] in its Motion for Reconsideration, reversed his July 30, 1998 Order and title to, or the use or the occupation of, the land or any building thereon.
reinstated the notices of lis pendens, as follows:
The CA opined that the Complaint filed by petitioner in Civil Case No. 97-2707 was
intended purely to collect a sum of money and to recover damages. The appellate court
1. The Court finds no merit in plaintiffs contention that in dismissing the above-entitled ruled that the Complaint did not aver any ownership claim to the subject land or any right
case for lack of jurisdiction, and at the same time granting defendant Herbal Coves motion of possession over the buildings constructed thereon. It further declared that absent any
to cancel notice of lis pendens, the Court [took] an inconsistent posture. The Rules provide claim on the title to the buildings or on the possession thereof, the notices of lis
that prior to the transmittal of the original record on appeal, the court may issue orders for pendens had no leg to stand on.
the protection and preservation of the rights of the parties which do not involve any matter
litigated by the appeal (3rd par., Sec. 10, Rule 41). Even as it declared itself without Likewise, the CA held that Judge Ranada should have maintained the notice
jurisdiction, this Court still has power to act on incidents in this case, such as acting on cancellations, which he had directed in his July 30, 1998 Order. Those notices were no
motions for reconsideration, for correction, for lifting of lis pendens, or approving appeals, longer necessary to protect the rights of petitioner, inasmuch as it could have procured
etc. protective relief from the Construction Industry Arbitral Commission (CIAC), where
provisional remedies were available. The CA also mentioned petitioners admission that
there was already a pending case before the CIAC, which in fact rendered a decision on
As correctly argued by defendant Herbal Cove, a notice of lis pendens serves only as a
March 11, 1999.
precautionary measure or warning to prospective buyers of a property that there is a
pending litigation involving the same. The appellate court further explained that the re-annotation of the Notice of Lis
Pendens was no longer warranted after the court a quo had ruled that the latter had no
The Court notes that when it issued the Order of 30 July 1998 lifting the notice of lis jurisdiction over the case. The former held that the rationale behind the principle of lis
pendens, there was as yet no appeal filed by plaintiff. Subsequently, on 10 September pendens -- to keep the subject matter of the litigation within the power of the court until the
1998, after a notice of appeal was filed by plaintiff on 4 September 1998, the Branch Clerk entry of final judgment -- was no longer applicable. The reason for such inapplicability was
of Court was ordered by the Court to elevate the entire records of the above-entitled case that the Makati RTC already declared that it had no jurisdiction or power over the subject
to the Court of Appeals. It therefore results that the above-entitled case is still matter of the case.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Finally, the CA opined that petitioners Complaint had not alleged or claimed, as basis As a general rule, the only instances in which a notice of lis pendens may be availed
for the continued annotation of the Notice of Lis Pendens, the lien of contractors and of are as follows: (a) an action to recover possession of real estate; (b) an action for
laborers under Article 2242 of the New Civil Code. Moreover, petitioner had not even partition; and (c) any other court proceedings that directly affect the title to the land or the
referred to any lien of whatever nature. Verily, the CA ruled that the failure to allege and building thereon or the use or the occupation thereof.[10] Additionally, this Court has held
claim the contractors lien did not warrant the continued annotation on the property titles of that resorting to lis pendens is not necessarily confined to cases that involve title to or
Respondent Herbal Cove. possession of real property. This annotation also applies to suits seeking to establish a
right to, or an equitable estate or interest in, a specific real property; or to enforce a lien, a
Hence, this Petition.[7] charge or an encumbrance against it.[11]
Apparently, petitioner proceeds on the premise that its money claim involves the
enforcement of a lien. Since the money claim is for the nonpayment of materials and labor
The Issues used in the construction of townhouses, the lien referred to would have to be that provided
under Article 2242 of the Civil Code. This provision describes a contractors lien over an
immovable property as follows:
Petitioner raises the following issues for our consideration:
Art. 2242. With reference to specific immovable property and real rights of the debtor, the
I. Whether or not money claims representing cost of materials [for] and labor
following claims, mortgages and liens shall be preferred, and shall constitute an
[on] the houses constructed on a property [are] a proper lien for annotation
encumbrance on the immovable or real right:
of lis pendens on the property title[.]
II. Whether or not the trial court[,] after having declared itself without jurisdiction xxxxxxxxx
to try the case[,] may still decide on [the] substantial issue of the case.[8]
(3) Claims of laborers, masons, mechanics and other workmen, as well as of architects,
engineers and contractors, engaged in the construction, reconstruction or repair of
This Courts Ruling buildings, canals or other works, upon said buildings, canals or other works;
On the other hand, Respondent Herbal Cove argues that the annotation is bereft of any Even assuming that petitioner had sufficiently alleged such lien or encumbrance in its
factual or legal basis, because petitioners Complaint[9] does not directly affect the title to the Complaint, the annotation of the Notice of Lis Pendens would still be unjustified, because a
property, or the use or the possession thereof. It also claims that petitioners Complaint did complaint for collection and damages is not the proper mode for the enforcement of a
not assert ownership of the property or any right to possess it. Moreover, respondent attacks contractors lien.
as baseless the annotation of the Notice of Lis Pendens through the enforcement of a
contractors lien under Article 2242 of the Civil Code. It points out that the said provision In J.L. Bernardo Construction v. Court of Appeals,[13] the Court explained the concept
applies only to cases in which there are several creditors carrying on a legal action against of a contractors lien under Article 2242 of the Civil Code and the proper mode for its
an insolvent debtor. enforcement as follows:
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Articles 2241 and 2242 of the Civil Code enumerates certain credits which enjoy Pea adds that even if a party initially avails itself of a notice of lis pendens upon the
preference with respect to specific personal or real property of the debtor. Specifically, filing of a case in court, such notice is rendered nugatory if the case turns out to be a
the contractors lien claimed by the petitioners is granted under the third paragraph purely personal action. We quote him as follows:
of Article 2242 which provides that the claims of contractors engaged in the
construction, reconstruction or repair of buildings or other works shall be preferred It may be possible also that the case when commenced may justify a resort to lis pendens,
with respect to the specific building or other immovable property constructed. but during the progress thereof, it develops to be purely a personal action for damages or
otherwise. In such event, the notice of lis pendens has become functus
However, Article 2242 finds application when there is a concurrence of credits, i.e., officio.[18](Emphasis supplied)
when the same specific property of the debtor is subjected to the claims of several
creditors and the value of such property of the debtor is insufficient to pay in full all Thus, when a complaint or an action is determined by the courts to be in personam,
the creditors.In such a situation, the question of preference will arise, that is, there will be the rationale for or purpose of the notice of lis pendens ceases to exist. To be sure, this
a need to determine which of the creditors will be paid ahead of the others. Fundamental Court has expressly and categorically declared that the annotation of a notice of lis
tenets of due process will dictate that this statutory lien should then only be pendens on titles to properties is not proper in cases wherein the proceedings instituted
enforced in the context of some kind of a proceeding where the claims of all the are actions in personam.[19]
preferred creditors may be bindingly adjudicated, such as insolvency
proceedings.[14] (Emphasis supplied)
Clearly then, neither Article 2242 of the Civil Code nor the enforcement of the lien Second Issue:
thereunder is applicable here, because petitioners Complaint failed to satisfy the foregoing Jurisdiction of the Trial Court
requirements. Nowhere does it show that respondents property was subject to the claims
of other creditors or was insufficient to pay for all concurring debts. Moreover, the
Complaint did not pertain to insolvency proceedings or to any other action in which the Petitioner argues that the RTC had no jurisdiction to issue the Order canceling the
adjudication of claims of preferred creditors could be ascertained. Notice of Lis Pendens as well as the Order reinstating it. Supposedly, since both Orders
were issued by the trial court without jurisdiction, the annotation made by the Register of
Another factor negates the argument of petitioner that its money claim involves the Deeds of Tagaytay City must remain in force.
enforcement of a lien or the assertion of title to or possession of the subject property: the
fact that it filed its action with the RTC of Makati, which is undisputedly bereft of any Petitioner avers that the trial court finally declared that the latter had no jurisdiction
jurisdiction over respondents property in Tagaytay City. Certainly, actions affecting title to over the case on July 27, 1998, in an Order denying the formers Motion for
or possession of real property or the assertion of any interest therein should be Reconsideration of the March 17, 1998 Order dismissing the Complaint. Petitioner insists
commenced and tried in the proper court that has jurisdiction over the area, where the real that the subsequent July 30, 1998 Order cancelling the subject Notice of Lis Pendens is
property involved or a portion thereof is situated. [15] If petitioner really intended to assert its void, because it was issued by a court that had no more jurisdiction over the case.
claim or enforce its supposed lien, interest or right over respondents subject properties, it
would have instituted the proper proceedings or filed a real action with the RTC of Rule 41 of the 1997 Rules on Civil Procedure, which governs appeals from regional
Tagaytay City, which clearly had jurisdiction over those properties. [16] trial courts, expressly provides that RTCs lose jurisdiction over a case when an appeal is
filed. The rule reads thus:
Narciso Pea, a leading authority on the subject of land titles and registration, gives
an explicit exposition on the inapplicability of the doctrine of lis pendens to certain actions
and proceedings that specifically include money claims. He explains in this wise: SEC. 9. Perfection of appeal; effect thereof. -- A partys appeal by notice of appeal is
deemed perfected as to him upon the filing of the notice of appeal in due time.
By express provision of law, the doctrine of lis pendens does not apply to attachments,
levies of execution, or to proceedings for the probate of wills, or for administration of the xxxxxxxxx
estate of deceased persons in the Court of First Instance. Also, it is held generally that the
doctrine of lis pendens has no application to a proceeding in which the only object In appeals by notice of appeal, the court loses jurisdiction over the case upon the
sought is the recovery of a money judgment, though the title or right of possession perfection of the appeals filed in due time and the expiration of the time to appeal of
to property be incidentally affected. It is essential that the property be directly affected, the other parties. (Emphasis supplied)
as where the relief sought in the action or suit includes the recovery of possession, or the
enforcement of a lien, or an adjudication between conflicting claims of title, possession, or
On the basis of the foregoing rule, the trial court lost jurisdiction over the case only
the right of possession to specific property, or requiring its transfer or sale [17] (Emphasis
on August 31, 1998, when petitioner filed its Notice of Appeal. [20] Thus, any order issued
supplied)
by the RTC prior to that date should be considered valid, because the court still had
jurisdiction over the case. Accordingly, it still had the authority or jurisdiction to issue the
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
July 30, 1998 Order canceling the Notice of Lis Pendens. On the other hand, G.R. No. 189477 February 26, 2014
the November 4, 1998 Order that set aside the July 30, 1998Order and reinstated that
Notice should be considered without force and effect, because it was issued by the trial HOMEOWNERS SAVINGS AND LOAN BANK, Petitioner-Appellant,
court after it had already lost jurisdiction.
vs.
In any case, even if we were to adopt petitioners theory that both the July 30, 1998 ASUNCION P. FELONIA and LYDIA C. DE GUZMAN, represented by MARIBEL
and the November 4, 1998 Orders were void for having been issued without jurisdiction, FRIAS, Respondents-Appellees.
the annotation is still improper for lack of factual and legal bases. MARIE MICHELLE P. DELGADO, REGISTER OF DEEDS OF LAS PINAS CITY and
RHANDOLFO B. AMANSEC, in his capacity as Clerk of Court Ex-Officio Sheriff,
As discussed previously, erroneously misplaced is the reliance of petitioner on the Office of the Clerk of Court, Las Pias City,Respondents-Defendants.
premise that its money claim is an action for the enforcement of a contractors lien. Verily,
the annotation of the Notice of Lis Pendens on the subject property titles should not have DECISION
been made in the first place. The Complaint filed before the Makati RTC -- for the
collection of a sum of money and for damages -- did not provide sufficient legal basis for
such annotation. PEREZ, J.:
Finally, petitioner vehemently insists that the trial court had no jurisdiction to cancel
Assailed in this Petition for Review on Certiorari is the Decision 1 and Resolution2 of the
the Notice. Yet, the former filed before the CA an appeal, docketed as CA-GR CV No.
Court of Appeals (CA), in CA-G.R. CV No. 87540, which affirmed with modifications, the
65647,[21] questioning the RTCs dismissal of the Complaint for lack of
Decision3 of the Regional Trial Court (RTC), reinstating the title of respondents Asuncion
jurisdiction. Moreover, it must be remembered that it was petitioner which had initially
Felonia (Felonia) and Lydia de Guzman (De Guzman) and cancelling the title of Marie
invoked the jurisdiction of the trial court when the former sought a judgment for the
Michelle Delgado (Delgado).
recovery of money and damages against respondent. Yet again, it was also petitioner
which assailed that same jurisdiction for issuing an order unfavorable to the formers
cause. Indeed, parties cannot invoke the jurisdiction of a court to secure affirmative relief, The facts as culled from the records are as follows:
then repudiate or question that same jurisdiction after obtaining or failing to obtain such
relief.[22] Felonia and De Guzman were the registered owners of a parcel of land consisting of 532
WHEREFORE, the Petition is hereby DENIED and the assailed square meters with a five-bedroom house, covered by Transfer of Certificate of Title (TCT)
Decision AFFIRMED. Costs against petitioner. No. T-402 issued by the register of deeds of Las Pias City.
SO ORDERED. Sometime in June 1990, Felonia and De Guzman mortgaged the property to Delgado to
secure the loan in the amount of 1,655,000.00. However, instead of a real estate
mortgage, the parties executed a Deed of Absolute Sale with an Option to Repurchase. 4
WHEREFORE, judgment is hereby rendered directing the [Felonia and De Guzman] and
the [Delgado] to execute a deed of mortgage over the property in question taking into
account the payments made and the imposition of the legal interests on the principal loan.
On the other hand, the counterclaim is hereby dismissed for lack of merit.
Aggrieved, Delgado elevated the case to the CA where it was docketed as CA-G.R. CV On 20 November1997, HSLB foreclosed the subject property and later consolidated
No. 49317. The CA affirmed the trial court decision. On 16 October 2000, the CA decision ownership in its favor, causing the issuance of a new title in its name, TCT No. 64668.
became final and executory.7
On 27 October 2000, the CA annulled and set aside the decision of the RTC, Las Pias
Inspite of the pendency of the Reformation case in which she was the defendant, Delgado City in the Consolidation case. The decision of the CA, declaring Felonia and De Guzman
filed a "Petition for Consolidation of Ownership of Property Sold with an Option to as the absolute owners of the subject property and ordering the cancellation of Delgados
Repurchase and Issuance of a New Certificate of Title" (Consolidation case) in the RTC of title, became final and executory on 1 December 2000. 12 Thus:
Las Pias, on 20 June 1994.8 After an ex-parte hearing, the RTC ordered the issuance of a
new title under Delgados name, thus: WHEREFORE, the petition is GRANTED and the subject judgment of the court a quo is
ANNULLED and SET ASIDE.13
WHEREFORE, judgment is rendered-
On 29 April 2003, Felonia and De Guzman, represented by Maribel Frias (Frias), claiming
1. Declaring [DELGADO] as absolute owner of the subject parcel of land covered to be the absolute owners of the subject property, instituted the instant complaint against
by Transfer Certificate of Title No. T-402 of the Register of Deeds of Las Pias, Delgado, HSLB, Register of Deeds of Las Pias City and Rhandolfo B. Amansec before
Metro Manila; the RTC of Las Pias City for Nullity of Mortgage and Foreclosure Sale, Annulment of
Titles of Delgado and HSLB, and finally, Reconveyance of Possession and Ownership of
2. Ordering the Register of Deeds of Las Pias, Metro Manila to cancel Transfer the subject property in their favor.
Certificate of Title No. T-402 and issue in lieu thereof a new certificate of title and
owners duplicate copy thereof in the name of [DELGADO]. 9 As defendant, HSLB asserted that Felonia and De Guzman are barred from laches as they
had slept on their rights to timely annotate, by way of Notice of Lis Pendens, the pendency
By virtue of the RTC decision, Delgado transferred the title to her name. Hence, TCT No. of the Reformation case. HSLB also claimed that it should not be bound by the decisions
of the CA in the Reformation and Consolidation cases because it was not a party therein.
T-402, registered in the names of Felonia and De Guzman, was canceled and TCT No.
44848 in the name of Delgado, was issued.
Finally, HSLB asserted that it was a mortgagee in good faith because the mortgage
Aggrieved, Felonia and De Guzman elevated the case to the CA through a Petition for between Delgado and HSLB was annotated on the title on 5 June 1995, whereas the
Notice of Lis Pendens was annotated only on 14 September 1995.
Annulment of Judgment.10
After trial, the RTC ruled in favor of Felonia and De Guzman as the absolute owners of the
Meanwhile, on 2 June 1995, Delgado mortgaged the subject property to Homeowners
Savings and Loan Bank (HSLB) using her newly registered title. Three (3) days later, or on subject property. The dispositive portion of the RTC decision reads:
5 June 1995, HSLB caused the annotation of the mortgage.
WHEREFORE, premises considered, the Court hereby finds for the [Felonia and De
On 14 September 1995, Felonia and De Guzman caused the annotation of a Notice of Lis Guzman] with references to the decision of the Court of Appeals in CA-G.R. CV No. 49317
Pendens on Delgados title, TCT No. 44848. The Notice states: and CA-G.R. SP No. 43711 as THESE TWO DECISIONS CANNOT BE IGNORED and
against [Delgado] and [HSLB], Register of Deeds of Las Pias City ordering the (sic) as
follows:
Entry No. 8219/T-44848 NOTICE OF LIS PENDENS filed by Atty. Humberto A.
Jambora, Counsel for the Plaintiff, that a case been commenced in the RTC, Branch 38,
Manila, entitled ASUNCION P. FELONIA and LYDIA DE GUZMAN thru VERONICA P. 1. The Register of Deeds of Las Pias City to cancel Transfer Certificate of Title
Nos. 44848 and T-64668 as null and void and reinstating Transfer Certificate of
BELMONTE, as Atty-in-fact (Plaintiffs) v.s. MARIE MICHELLE DELGADO defendant in
Civil Case No. 91-59654 for Reformation of Instrument. Title No. T-402 which shall contain a memorandum of the fact and shall in all
respect be entitled to like faith and credit as the original certificate of title and
shall, thereafter be regarded as such for all intents and purposes under the law;
Copy on file in this Registry.
2. Declaring the Mortgage Sheriffs Sale and the Certificate of Sale issued in
Date of Instrument Sept. 11, 1995 favor of HSLB null and void, without prejudice to whatever rights the said Bank
may have against [Delgado];
Date of Inscription Sept. 14, 1995 at 9:55 a.m.11
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
3. Ordering [Delgado] to pay [Felonia and De Guzman] the amount of There is, however, a situation where, despite the fact that the mortgagor is not the owner
PH500,000.00 for compensatory damages; of the mortgaged property, his title being fraudulent, the mortgage contract and any
foreclosure sale arising there from are given effect by reason of public policy. This is the
doctrine of "the mortgagee in good faith" based on the rule that all persons dealing with
4. Ordering [Delgado] to pay [Felonia and De Guzman] the amount of
PH500,000.00 for exemplary damages; property covered by the Torrens Certificates of Title, as buyers or mortgagees, are not
required to go beyond what appears on the face of the title. The public interest in
upholding indefeasibility of a certificate of title, as evidence of lawful ownership of the land
5. Ordering [Delgado] to pay [Felonia and De Guzman] the amount of or of any encumbrance thereon, protects a buyer or mortgagee who, in good faith, relied
PH500,000.00 for moral damages; upon what appears on the face of the certificate of title.
6. Ordering [Delgado] to pay 20% of the total obligations as and by way of When the property was mortgaged to HSLB, the registered owner of the subject property
attorneys fees; was Delgado who had in her name TCT No. 44848. Thus, HSLB cannot be faulted in
relying on the face of Delgados title. The records indicate that Delgado was at the time of
7. Ordering [Delgado] to pay cost of suit.14 the mortgage in possession of the subject property and Delgados title did not contain any
annotation that would arouse HSLBs suspicion. HSLB, as a mortgagee, had a right to rely
in good faith on Delgados title, and in the absence of any sign that might arouse
On appeal, the CA affirmed with modifications the trial court decision. The dispositive suspicion, HSLB had no obligation to undertake further investigation. As held by this Court
portion of the appealed Decision reads: in Cebu International Finance Corp. v.
WHEREFORE, in the light of the foregoing, the decision appealed from is AFFIRMED with CA:18
the MODIFICATIONS that the awards of actual damages and attorneys fees are
DELETED, moral and exemplary damages are REDUCED to 50,000.00 each, and
Delgado is ordered to pay the appellees 25,000.00 as nominal damages. 15 The prevailing jurisprudence is that a mortgagee has a right to rely in good faith on the
certificate of title of the mortgagor of the property given as security and in the absence of
any sign that might arouse suspicion, has no obligation to undertake further investigation.
Hence, this petition. Hence, even if the mortgagor is not the rightful owner of, or does not have a valid title to,
the mortgaged property, the mortgagee or transferee in good faith is nonetheless entitled
Notably, HSLB does not question the affirmance by the CA of the trial courts ruling that to protection.
TCT No. 44848, the certificate of title of its mortgagor-vendor, and TCT No. 64668, the
certificate of title that was secured by virtue of the Sheriffs sale in its favor, should be However, the rights of the parties to the present case are defined not by the determination
cancelled "as null and void" and that TCT No. T-402 in the name of Felonia and De of whether or not HSLB is a mortgagee in good faith, but of whether or not HSLB is a
Guzman should be reinstated. purchaser in good faith. And, HSLB is not such a purchaser.
Recognizing the validity of TCT No. T-402 restored in the name of Felonia and De A purchaser in good faith is defined as one who buys a property without notice that some
Guzman, petitioners pray that the decision of the CA be modified "to the effect that the other person has a right to, or interest in, the property and pays full and fair price at the
mortgage lien in favor of petitioner HSLB annotated as entry No. 4708-12 on TCT No. time of purchase or before he has notice of the claim or interest of other persons in the
44848 be [ordered] carried over on TCT No. T-402 after it is reinstated in the name of property.19
[Felonia and De Guzman]."16
When a prospective buyer is faced with facts and circumstances as to arouse his
Proceeding from the ruling of the CA that it is a mortgagee in good faith, HSLB argues that suspicion, he must take precautionary steps to qualify as a purchaser in good faith. In
a denial of its prayer would run counter to jurisprudence giving protection to a mortgagee Spouses Mathay v. CA,20 we determined the duty of a prospective buyer:
in good faith by reason of public policy.
Although it is a recognized principle that a person dealing on a registered land need not go
We cannot grant the prayer of petitioner. The priorly registered mortgage lien of HSLB is beyond its certificate of title, it is also a firmly settled rule that where there are
now worthless. circumstances which would put a party on guard and prompt him to investigate or inspect
the property being sold to him, such as the presence of occupants/tenants thereon, it is of
Arguably, HSLB was initially a mortgagee in good faith. In Bank of Commerce v. San course, expected from the purchaser of a valued piece of land to inquire first into the status
Pablo, Jr.,17 the doctrine of mortgagee in good faith was explained: or nature of possession of the occupants, i.e., whether or not the occupants possess the
land en concepto de dueo, in the concept of the owner. As is the common practice in the
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
real estate industry, an ocular inspection of the premises involved is a safeguard a title prior to the annotation of the notice of lis pendens; but when petitioner bought the
cautious and prudent purchaser usually takes. Should he find out that the land he intends property as the highest bidder at the auction sale made as an aftermath of the foreclosure
to buy is occupied by anybody else other than the seller who, as in this case, is not in of the mortgage, the title already bore the notice of lis pendens. Held: While the notice of
actual possession, it would then be incumbent upon the purchaser to verify the extent of lis pendens cannot affect petitioners right as mortgagee, because the same was
the occupants possessory rights. The failure of a prospective buyer to take such annotated subsequent to the mortgage, yet the said notice affects its right as purchaser
precautionary steps would mean negligence on his part and would thereby preclude him because notice of lis pendens simply means that a certain property is involved in a
from claiming or invoking the rights of a purchaser in good faith. litigation and serves as a notice to the whole world that one who buys the same does so at
his own risk.26
In the case at bar, HSLB utterly failed to take the necessary precautions.1wphi1 At the
time the subject property was mortgaged, there was yet no annotated Notice of Lis The subject of the lis pendens on the title of HSLBs vendor, Delgado, is the "Reformation
Pendens. However, at the time HSLB purchased the subject property, the Notice of Lis case" filed against Delgado by the herein respondents. The case was decided with finality
Pendens was already annotated on the title. 21 by the CA in favor of herein respondents. The contract of sale in favor of Delgado was
ordered reformed into a contract of mortgage. By final decision of the CA, HSLBs vendor,
Lis pendens is a Latin term which literally means, "a pending suit or a pending litigation" Delgado, is not the property owner but only a mortgagee. As it turned out, Delgado could
while a notice of lis pendens is an announcement to the whole world that a real property is not have constituted a valid mortgage on the property. That the mortgagor be the absolute
in litigation, serving as a warning that anyone who acquires an interest over the property owner of the thing mortgaged is an essential requisite of a contract of mortgage. Article
2085 (2) of the Civil Code specifically says so:
does so at his/her own risk, or that he/she gambles on the result of the litigation over the
property.22 It is a warning to prospective buyers to take precautions and investigate the
pending litigation. Art. 2085. The following requisites are essential to the contracts of pledge and mortgage:
The purpose of a notice of lis pendens is to protect the rights of the registrant while the xxxx
case is pending resolution or decision. With the notice of lis pendens duly recorded and
remaining uncancelled, the registrant could rest secure that he/she will not lose the (2) That the pledgor or mortagagor be the absolute owner of the thing pledged or
property or any part thereof during litigation. mortgaged.
The doctrine of lis pendens is founded upon reason of public policy and necessity, the Succinctly, for a valid mortgage to exist, ownership of the property is an essential
purpose of which is to keep the subject matter of the litigation within the Courts jurisdiction requisite.27
until the judgment or the decree have been entered; otherwise, by successive alienations
pending the litigation, its judgment or decree shall be rendered abortive and impossible of
execution.23 Reyes v. De Leon28 cited the case of Philippine National Bank v. Rocha29 where it was
pronounced that "a mortgage of real property executed by one who is not an owner thereof
at the time of the execution of the mortgage is without legal existence." Such that,
Indeed, at the time HSLB bought the subject property, HSLB had actual knowledge of the according to DBP v. Prudential Bank,30 there being no valid mortgage, there could also be
annotated Notice of Lis Pendens. Instead of heeding the same, HSLB continued with the no valid foreclosure or valid auction sale.
purchase knowing the legal repercussions a notice of lis pendens entails. HSLB took upon
itself the risk that the Notice of Lis Pendens leads to.1wphi1 As correctly found by the CA,
"the notice of lis pendens was annotated on 14 September 1995, whereas the foreclosure We go back to Bank of Commerce v. San Pablo, Jr. 31 where the doctrine of mortgagee in
sale, where the appellant was declared as the highest bidder, took place sometime in good faith, upon which petitioner relies, was clarified as "based on the rule that all persons
1997. There is no doubt that at the time appellant purchased the subject property, it was dealing with property covered by the Torrens Certificate of Title, as buyers or mortgagees,
aware of the pending litigation concerning the same property and thus, the title issued in its are not required to go beyond what appears on the face of the title. In turn, the rule is
favor was subject to the outcome of said litigation."24 based on "x x x public interest in upholding the indefeasibility of a certificate of title, as
evidence of lawful ownership of the land or of any encumbrance thereon." 32
This ruling is in accord with Rehabilitation Finance Corp. v. Morales, 25 which underscored
the significance of a lis pendens, then defined in Sec. 24, Rule 7 now Sec. 14 of Rule 13 in Insofar as the HSLB is concerned, there is no longer any public interest in upholding the
relation to a mortgage priorly annotated on the title covering the property. Thus: indefeasibility of the certificate of title of its mortgagor, Delgado. Such title has been
nullified in a decision that had become final and executory. Its own title, derived from the
foreclosure of Delgado's mortgage in its favor, has likewise been nullified in the very same
The notice of lis pendens in question was annotated on the back of the certificate of title as decision that restored the certificate of title in respondents' name. There is absolutely no
a necessary incident of the civil action to recover the ownership of the property affected by reason that can support the prayer of HSLB to have its mortgage lien carried over and into
it. The mortgage executed in favor of petitioner corporation was annotated on the same the restored certificate of title of respondents.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
WHEREFORE, the Petition is DENIED. The Decision of the Court of Appeals in CA-G.R. the property described herein in accordance with Doc. No. 336; Page No. 69; Book No. 1;
CV No. 87540 is AFFIRMED. SO ORDERED. s. of 1981 of Not. Pub. of Makati, M.M., Romarie G. Villonco, dated August 4, 1981.
G.R. No. 168655 July 2, 2010 (Sgd) VICTORIANO S. TORRES, Actg. Reg. of Deeds
J. CASIM CONSTRUCTION SUPPLIES, INC., Petitioner, Entry No. 82-4676/T-49936 - CANCELLATION OF ADVERSE CLAIM inscribed hereon
vs. under Entry No. 81-8334/T-30459 in accordance with Doc. No. 247; Page 50; Book No.
REGISTRAR OF DEEDS OF LAS PIAS, Respondent. CXLI; s. of 1982 of Not. Pub. of Pasay City, M.M., Julian G. Tubig, dated April 21, 1982.
INTESTATE ESTATE OF BRUNEO F. CASIM, (Purported) Intervenor.
Date of inscription - April 21, 1982 - 8:40 a.m.
DECISION
(Sgd) VICTORIANO S. TORRES, Actg. Reg. of Deeds
PERALTA, J.:
Entry No. 82-4678/T-49936 - AFFIDAVIT - In accordance with the affidavit duly executed
This is a petition for review under Rule 45 of the Rules of Court, taken directly on a pure by the herein registered owners, this title is hereby cancelled and in lieu thereof TCT No.
question of law from the April 14, 2005 Resolution 1 and June 24, 2005 Order2 issued by 49936/T-228 has been issued in accordance with Doc. No. 249; Page No. 80; Book No.
the Regional Trial Court (RTC) of Las Pias City, Branch 253 in Civil Case No. LP-04- CXLI; s. of 1982 of Not. Pub. of Pasay City, M.M., Julian G. Tubig, dated April 21, 1982.
00713 one for cancellation of notice of lis pendens. The assailed Resolution dismissed
for lack of jurisdiction the petition filed by J. Casim Construction Supplies Inc. for
Date of inscription - April 21, 1982 - 8:44 a.m.
cancellation of notice of lis pendens annotated on its certificate of title, whereas the
assailed Order denied reconsideration.
(Sgd) VICTORIANO S. TORRES, Actg. Reg. of Deeds
The facts follow.
Entry No. 81-12423/T-30459 - NOTICE OF LIS PENDENS: By virtue of the notice of Lis
Pendens presented and filed by CESAR P. MANALAYSAY, counsel for the plaintiff, notice
Petitioner, represented herein by Rogelio C. Casim, is a duly organized domestic
is hereby given that a petition for review has been commenced and now pending in the
corporation4 in whose name Transfer Certificate of Title (TCT) No. 49936,5 covering a Court of First Instance of Rizal, Branch XXIX, Pasay, M.M, in Civil Case No. LP-9438-P,
10,715-square meter land was registered. Sometime in 1982, petitioner acquired the
BRUNEO F. CASIM, Plaintiff, vs. SPS. JESUS A. CASIM & MARGARITA CHAVEZ and
covered property by virtue of a Deed of Absolute Sale6 and as a result the mother title, Sps. Urbano Nobleza and Cristita J. Nobleza, and Filomena C. Antonio, Defendants,
TCT No. 30459 was cancelled and TCT No. 49936 was issued in its stead. 7 involving the property described herein.
On March 22, 2004, petitioner filed with the RTC of Las Pias City, Branch 253 an original
Date of the instrument - Sept. 17, 1981
petition for the cancellation of the notice of lis pendens, as well as of all the other entries of
involuntary encumbrances annotated on the original copy of TCT No. 49936. Invoking the
inherent power of the trial court to grant relief according to the petition, petitioner prayed Date of the inscription - Sept. 18, 1981 - 3:55 p.m.
that the notice of lis pendens as well as all the other annotations on the said title be
cancelled. Petitioner claimed that its owner's duplicate copy of the TCT was clean at the (Sgd) VICTORIANO S. TORRES, Actg. Reg. of Deeds9
time of its delivery and that it was surprised to learn later on that the original copy of its
TCT, on file with the Register of Deeds, contained several entries which all signified that
the covered property had been subjected to various claims. The subject notice of lis To justify the cancellation, petitioner alleged that the notice of lis pendens, in particular,
pendens is one of such entries.8 The notations appearing on the title's memorandum of was a forgery judging from the inconsistencies in the inscriber's signature as well as from
encumbrances are as follows: the fact that the notice was entered non-chronologically, that is, the date thereof is much
earlier than that of the preceding entry. In this regard, it noted the lack of any transaction
record on file with the Register of Deeds that would support the notice of lis pendens
Entry No. 81-8334/T-30459 - ADVERSE CLAIM - In an affidavit duly subscribed and sworn annotation.10
to, BRUNO F. CASIM claims, among other things, that he has the right and interest over
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Petitioner also stated that while Section 59 of Presidential Decree (P.D.) No. 1529 requires because a trial court has the inherent power to cause such cancellation, especially in this
the carry-over of subsisting encumbrances in the new issuances of TCTs, petitioner's case that petitioner was never a party to the litigation to which the notice of lis pendens
duplicate copy of the title did not contain any such carry-over, which means that it was an relates.20 Petitioner further posits that the trial court has committed an error in declining to
innocent purchaser for value, especially since it was never a party to the civil case referred rule on the allegation of forgery, especially since there is no transaction record on file with
to in the notice of lis pendens. Lastly, it alludes to the indefeasibility of its title despite the the Register of Deeds relative to said entries. It likewise points out that granting the notice
fact that the mother title, TCT No. 30459, might have suffered from certain defects and of lis pendens has been properly annotated on the title, the fact that its owner's duplicate
constraints.11 title is clean suggests that it was never a party to the civil case referred to in the
notice.21 Finally, petitioner posits that TCT No. 49936 is indefeasible and holds it free from
The Intestate Estate of Bruneo F. Casim, representing Bruneo F. Casim, intervened in the any liens and encumbrances which its mother title, TCT No. 30459, might have suffered. 22
instant case and filed a Comment/Opposition12 in which it maintained that the RTC of Las
Pias did not have jurisdiction over the present action, because the matter of canceling a The Intestate Estate of Bruneo F. Casim (intervenor), in its Comment on the present
notice of lis pendens lies within the jurisdiction of the court before which the main action petition, reiterates that the court a quo does not have jurisdiction to order the cancellation
referred to in the notice is pending. In this regard, it emphasized that the case referred to in of the subject notice of lis pendens because it is only the court exercising jurisdiction over
the said notice had already attained finality as the Supreme Court had issued an entry of the property which may order the same that is, the court having jurisdiction over the
judgment therein and that the RTC of Makati City had ordered execution in that case. 13 It main action in relation to which the registration of the notice has been sought. Also, it
cited the lack of legal basis for the petition in that nothing in the allegations hints at any of notes that even on the assumption that the trial court had such jurisdiction, the petition for
the legal grounds for the cancellation of notice of lis pendens. 14 And, as opposed to cancellation still has no legal basis as petitioner failed to establish the grounds therefor.
petitioner's claim that there was no carry-over of encumbrances made in TCT No. 49936 Also, the subject notice of lis pendens was validly carried over to TCT No. 49936 from the
from the mother title TCT No. 30459, the latter would show that it also had the same mother title, TCT No. 30459.
inscriptions as those found in TCT No. 49936 only that they were entered in the original
copy on file with the Register of Deeds. Also, as per Certification 15 issued by the Register In its Reply,23 petitioner, in a semantic slur, dealt primarily with the supposed
of Deeds, petitioner's claim of lack of transaction record could not stand, because the said inconsistencies in intervenor's arguments. Yet the core of its contention is that the non-
certification stated merely that the corresponding transaction record could no longer be chronological annotation of the notice stands to be the best evidence of forgery. From this,
retrieved and might, therefore, be considered as either lost or destroyed. it advances the notion that forgery of the notice of lis pendens suffices as a ground for the
cancellation thereof which may be availed of in an independent action by the aggrieved
On April 14, 2005, the trial court, ruling that it did not have jurisdiction over the action, party.
resolved to dismiss the petition and declared that the action must have been filed before
the same court and in the same action in relation to which the annotation of the notice of lis The petition is utterly unmeritorious.
pendens had been sought. Anent the allegation that the entries in the TCT were forged,
the trial court pointed out that not only did petitioner resort to the wrong forum to determine
the existence of forgery, but also that forgery could not be presumed merely from the Lis pendens which literally means pending suit refers to the jurisdiction, power or
alleged non-chronological entries in the TCT but instead must be positively proved. In this control which a court acquires over the property involved in a suit, pending the continuance
connection, the trial court noted petitioner's failure to name exactly who had committed the of the action, and until final judgment.24Founded upon public policy and necessity, lis
forgery, as well as the lack of evidence on which the allegation could be based.16 The pendens is intended to keep the properties in litigation within the power of the court until
petition was disposed of as follows: the litigation is terminated, and to prevent the defeat of the judgment or decree by
subsequent alienation.25 Its notice is an announcement to the whole world that a particular
property is in litigation and serves as a warning that one who acquires an interest over said
IN VIEW OF THE FOREGOING, the instant petition is hereby DISMISSED. property does so at his own risk, or that he gambles on the result of the litigation over said
property.26
SO ORDERED.17
A notice of lis pendens, once duly registered, may be cancelled by the trial court before
Petitioner moved for reconsideration,18 but it was denied in the trial court's June 24, 2005 which the action involving the property is pending. This power is said to be inherent in the
Order.19 trial court and is exercised only under express provisions of law. 27 Accordingly, Section 14,
Rule 13 of the 1997 Rules of Civil Procedure authorizes the trial court to cancel a notice of
lis pendens where it is properly shown that the purpose of its annotation is for molesting
Now, raising the purely legal question of whether the RTC of Las Pias City, Branch 253
has jurisdiction in an original action to cancel the notice of lis pendens annotated on the the adverse party, or that it is not necessary to protect the rights of the party who caused it
to be annotated. Be that as it may, the power to cancel a notice of lis pendens is exercised
subject title as an incident in a previous case, petitioner, in this present petition, ascribes
error to the trial court in dismissing its petition for cancellation. An action for cancellation of only under exceptional circumstances, such as: where such circumstances are imputable
to the party who caused the annotation; where the litigation was unduly prolonged to the
notice of lis pendens, petitioner believes, is not always ancillary to an existing main action
prejudice of the other party because of several continuances procured by petitioner; where
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
the case which is the basis for the lis pendens notation was dismissed for non may be finally determined and laid down therein. The cancellation of such a precautionary
prosequitur on the part of the plaintiff; or where judgment was rendered against the party notice is therefore also a mere incident in the action, and may be ordered by the Court
who caused such a notation. In such instances, said notice is deemed ipso having jurisdiction of it at any given time. x x x40
facto cancelled.28
Clearly, the action for cancellation of the notice of lis pendens in this case must have been
In theorizing that the RTC of Las Pias City, Branch 253 has the inherent power to cancel filed not before the court a quo via an original action but rather, before the RTC of Makati
the notice of lis pendens that was incidentally registered in relation to Civil Case No. 2137, City, Branch 62 as an incident of the annulment case in relation to which its registration
a case which had been decided by the RTC of Makati City, Branch 62 and affirmed by the was sought. Thus, it is the latter court that has jurisdiction over the main case referred to in
Supreme Court on appeal, petitioner advocates that the cancellation of such a notice is not the notice and it is that same court which exercises power and control over the real
always ancillary to a main action. property subject of the notice.
The argument fails. But even so, the petition could no longer be expected to pursue before the proper forum
inasmuch as the decision rendered in the annulment case has already attained finality
before both the Court of Appeals and the Supreme Court on the appellate level, unless of
From the available records, it appears that the subject notice of lis pendens had been
recorded at the instance of Bruneo F. Casim (Bruneo) in relation to Civil Case No. course there exists substantial and genuine claims against the parties relative to the main
213729 one for annulment of sale and recovery of real property which he filed before case subject of the notice of lis pendens. 41 There is none in this case. It is thus well to note
the RTC of Makati City, Branch 62 against the spouses Jesus and Margarita Casim, that the precautionary notice that has been registered relative to the annulment case then
predecessors-in-interest and stockholders of petitioner corporation. That case involved the pending before the RTC of Makati City, Branch 62 has served its purpose. With the finality
property subject of the present case, then covered by TCT No. 30459. At the close of the of the decision therein on appeal, the notice has already been rendered functus officio.
trial on the merits therein, the RTC of Makati rendered a decision adverse to Bruneo and The rights of the parties, as well as of their successors-in-interest, petitioner included, in
relation to the subject property, are hence to be decided according the said final decision.
dismissed the complaint for lack of merit. 30 Aggrieved, Bruneo lodged an appeal with the
Court of Appeals, docketed as CA-G.R. CV No. 54204, which reversed and set aside the
trial court's decision.31 Expectedly, the spouses Jesus and Margarita Casim elevated the To be sure, petitioner is not altogether precluded from pursuing a specific remedy, only
case to the Supreme Court, docketed as G.R. No. 151957, but their appeal was dismissed that the suitable course of action legally available is not judicial but rather administrative.
for being filed out of time.32 Section 77 of P.D. No. 1529 provides the appropriate measure to have a notice of lis
pendens cancelled out from the title, that is by presenting to the Register of Deeds, after
finality of the judgment rendered in the main action, a certificate executed by the clerk of
A necessary incident of registering a notice of lis pendens is that the property covered
thereby is effectively placed, until the litigation attains finality, under the power and control court before which the main action was pending to the effect that the case has already
been finally decided by the court, stating the manner of the disposal thereof. Section 77
of the court having jurisdiction over the case to which the notice relates. 33 In this sense,
parties dealing with the given property are charged with the knowledge of the existence of materially states:
the action and are deemed to take the property subject to the outcome of the litigation. 34 It
is also in this sense that the power possessed by a trial court to cancel the notice of lis SEC. 77. Cancellation of lis pendens. - Before final judgment, a notice of lis pendens may
pendens is said to be inherent as the same is merely ancillary to the main be cancelled upon order of the court, after proper showing that the notice is for the
action.351avvphi1 purpose of molesting the adverse party, or that it is not necessary to protect the rights of
the party who caused it to be registered. It may also be cancelled by the Register of Deeds
Thus, in Vda. de Kilayko v. Judge Tengco, 36 Heirs of Maria Marasigan v. Intermediate upon verified petition of the party who caused the registration thereof.
Appellate Court37 and Tanchoco v. Aquino,38 it was held that the precautionary notice of lis
pendens may be ordered cancelled at any time by the court having jurisdiction over the At any time after final judgment in favor of the defendant, or other disposition of the action
main action inasmuch as the same is merely an incident to the said action. The such as to terminate finally all rights of the plaintiff in and to the land and/or buildings
pronouncement in Heirs of Eugenio Lopez, Sr. v. Enriquez, citing Magdalena Homeowners involved, in any case in which a memorandum or notice of lis pendens has been registered
Association, Inc. v. Court of Appeals,39 is equally instructive as provided in the preceding section, the notice of lis pendens shall be deemed cancelled
upon the registration of a certificate of the clerk of court in which the action or proceeding
The notice of lis pendens x x x is ordinarily recorded without the intervention of the court was pending stating the manner of disposal thereof. 42
where the action is pending. The notice is but an incident in an action, an extrajudicial one,
to be sure. It does not affect the merits thereof. It is intended merely to constructively Lastly, petitioner tends to make an issue out of the fact that while the original TCT on file
advise, or warn, all people who deal with the property that they so deal with it at their own with the Register of Deeds does contain the annotations and notice referred to in this
risk, and whatever rights they may acquire in the property in any voluntary transaction are petition, its owner's duplicate copy of the title nevertheless does not reflect the same non-
subject to the results of the action, and may well be inferior and subordinate to those which chronological inscriptions. From this, petitioner submits its puerile argument that the said
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
annotations appearing on the original copy of the TCT are all a forgery, and goes on to ARLYN* PINEDA, G.R. No. 170172
assert the indefeasibility of its Torrens title as well as its supposed status as an innocent Petitioner,
purchaser for value in good faith. Yet we decline to rule on these assumptions principally Present:
because they raise matters that call for factual determination which certainly are beyond
the competence of the Court to dispose of in this petition. YNARES-SANTIAGO, J.,
Chairperson,
All told, we find that the RTC of Las Pias City, Branch 253 has committed no reversible - versus - AUSTRIA-MARTINEZ,
error in issuing the assailed Resolution and Order dismissing for lack of jurisdiction the CHICO-NAZARIO,
petition for cancellation of notice of lis pendens filed by petitioner, and in denying NACHURA, and
reconsideration. REYES, JJ.
JULIE C. ARCALAS,
WHEREFORE, the petition is DENIED. The April 14, 2005 Resolution and the June 24, Respondent. Promulgated:
2005 Order issued by the Regional Trial Court of Las Pias City, Branch 253, in Civil Case
No. LP-04-0071, are hereby AFFIRMED. November 23, 2007
x-------------------------------------------------x
SO ORDERED.
DECISION
CHICO-NAZARIO, J.:
This is a Special Civil Action for Certiorari under Rule 65 of the Rules of Court, assailing
the Resolution[1] dated 25 January 2005, rendered by the Court of Appeals in C.A. G.R. CV
No. 82872, dismissing the appeal filed by petitioner Arlyn Pineda (Pineda) for failure to file
her appellants brief. Under the assailed Resolution, the Order [2] promulgated by Branch 27
of the Regional Trial Court of Santa Cruz, Laguna (Laguna RTC), on 2 February 2004,
granting the petition of respondent Julie Arcalas (Arcalas) for the cancellation of the
Affidavit of Adverse Claim annotated at the back of Transfer Certificate of Title (TCT) No.
The subject property consists of three parcels of land, which are described as Lot
No. 3762-D with an area of 42,958 square meters, Lot No. 3762-E with an area of 4,436
square meters, and Lot No. 3762-F with an area of 2,606 square meters, the total area of
which consists of 50,000 square meters. These three lots are portions of Lot No. 3762,
Victoria Tolentino bought the said property from the Spouses Lateo. Sometime later, Civil On 2 February 2000, after the finality[9] of the Order of the Quezon City RTC
Case No. Q-96-27884, for Sum of Money, was instituted by Arcalas against quashing Pinedas third-party claim, Pineda filed with the Office of the Register of Deeds of
Victoria Tolentino. This case stemmed from an indebtedness evidenced by a promissory Laguna another Affidavit of Third Party Claim and caused the inscription of a notice of
note and four post-dated checks later dishonored, which Victoria Tolentino owed Arcalas.[3] adverse claim at the back of TCT No. T-52319 under Entry No. 324094. [10]
favor of Arcalas and against Victoria Tolentino.[4] On 3 February 2000, Arcalas and Leonardo Byron P. Perez, Jr. purchased Lot
No. 3762 at an auction sale conducted by the Deputy Sheriff of Quezon City. The sale was
On 15 December 1997, Pineda bought the subject property from Victoria evidenced by a Sheriffs Certificate of Sale issued on the same day and registered as Entry
L. Tolentino.[5] Pineda alleged that upon payment of the purchase price, she took No. 324225 at the back of TCT No. T-52319.[11]
possession of the subject property by allowing a tenant, Rodrigo Bautista to cultivate the
same. However, Pineda failed to register the subject property under her name. [6] Arcalas then filed an action for the cancellation of the entry of Pinedas adverse
claim before the Laguna RTC. The Laguna RTC ordered the cancellation of the Notice of
To execute the judgment, the Quezon City RTC levied upon the subject property Adverse Claim annotated as Entry No. 324094 at the back of TCT No. 52319 on the
and the Notice of Levy on Alias Writ of Execution dated 12 January 1999 was annotated ground of res judicata:
as Entry No. 315074, in relation to Entry No. 319362, at the back of TCT No. T-52319.[7]
The court order emanating from Branch 91 of the Regional Trial Court
of Quezon City having become final and executory and no
relief therefrom having been filed by [Pineda], the said order granting
Asserting ownership of the subject property, Pineda filed with the Deputy Sheriff of the [Arcalass] Motion to Set Aside Affidavit of Title and 3 rd Party Claim
should be given due course and the corresponding annotation at the
the Quezon City RTC an Affidavit of Title and Third Party Claim. Arcalas filed a motion to back of TCT No. T-52319 as Entry No. 324094 dated February 2,
2000 should be expunged accordingly.[12]
set aside Pinedas Affidavit of Title and Third Party Claim, which on 3 November 1999,
Pineda appealed the Order of the Laguna RTC before the Court of Appeals
the Quezon City RTC granted, to wit:
under Rule 44 of the Rules of Court. In a Resolution dated 25 January 2005,[13] the
[Arcalas] showed that her levies on the properties were duly appellate court dismissed the appeal and considered it abandoned when Pineda failed to
registered while the alleged Deed of Absolute Sale between the
defendant Victoria L. Tolentino and Analyn G. Pineda was not. The file her appellants brief.
levies being superior to the sale claimed by Ms. Pineda, the court rules
to quash and set aside her Affidavit of Title and Third Party Claim.
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Land Titles and Deeds (Finals) 2017
Pineda filed a Motion for Reconsideration, wherein it was plainly stated that Pinedas
In special cases appealed to the Court of Appeals, such as certiorari,
counsel overlooked the period within which he should file the appellants brief. [14] The said
prohibition, mandamus, quo warranto and habeas corpus cases, a memorandum of
motion was denied in a Resolution dated 26 May 2005.Pineda filed a Second Motion for
appeal must be filed in place of an appellants brief as provided in Section 10 of Rule
Reconsideration, which was denied on 7 October 2005.[15] No appellants brief was
44 of the Rules of Court
attached to either motion for reconsideration.
WHETHER THE LEVY ON ALIAS WRIT OF EXECUTION ISSUED BY The failure of the appellant to file his memorandum within the
THE REGIONAL TRIAL COURT OF QUEZON CITY IN CIVIL CASE period therefor may be a ground for dismissal of the appeal.
NO. Q-96-27884 MAY EXEMPT THE PORTION BOUGHT BY
[PINEDA] FROM VICTORIA TOLENTINO; [and]
WHETHER THE POSSESSION OF [PINEDA] OF THE 5 HECTARES recognized grounds of dismissal of the appeal in Section 1 of Rule 50 of the Rules of
PORTION OF LOT 3762 IS ALREADY EQUIVALENT TO A TITLE
DESPITE THE ABSENCE OF REGISTRATION. Court:
xxxx
The Court of Appeals properly dismissed the case for Pinedas failure to file an appellants
(e) Failure of the appellant to serve and file the required number of
brief. This is in accordance with Section 7 of Rule 44 of the Rules of Court, which imposes copies of his brief or memorandum within the time provided by these
Rules;
upon the appellant the duty to file an appellants brief in ordinary appealed cases before the
Section 7. Appellants brief.It shall be the duty of the appellant to file Appeals[17]:
with the court, within forty-five (45) days from receipt of the notice of the
clerk that all the evidence, oral and documentary, are attached to the
record, seven (7) copies of his legibly typewritten, mimeographed or [T]he appellants brief is mandatory for the assignment of errors is vital
printed brief, with proof of service of two (2) copies thereof upon to the decision of the appeal on the merits. This is because on appeal
the appellee. only errors specifically assigned and properly argued in the brief or
memorandum will be considered, except those affecting jurisdiction
over the subject matter as well as plain and clerical errors. Otherwise
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Land Titles and Deeds (Finals) 2017
winning party must not be deprived of the fruits of the verdict, through a mere
Thus, in Casim v. Flordeliza,[18] this Court affirmed the dismissal of an appeal, even when
subterfuge. The time spent by the judiciary, more so of this Court, in taking cognizance
the filing of an appellants brief was merely attended by delay and fell short of some of the
and resolving cases is not limitless and cannot be wasted on cases devoid of any right
requirements of the Rules of Court. The Court, in Gonzales v. Gonzales,[19] reiterated that
calling for vindication and are merely reprehensible efforts to evade the operation of a
it is obligatory on the part of the appellant to submit or file a memorandum of appeal, and
decision that is final and executory.[23]
that failing such duty, the Rules of Court unmistakably command the dismissal of the
appeal.
In the present case, there is a clear intent on the part of Pineda to delay the
the Court of Appeals, where she merely let the period for the filing of the appellants brief
Thus, this Court cannot reverse or fault the appellate court for duly acting in
lapse without exerting any effort to file one. The two motions for reconsideration and even
faithful compliance with the rules of procedure and established jurisprudence that it has
the petition before this Court fail to present new issues. They raised the very same issues
been mandated to observe, nor turn a blind eye and tolerate the transgressions of these
which had been consistently resolved by both the Quezon City RTC and the Laguna RTC
rules and doctrines.[20] An appealing party must strictly comply with the requisites laid down
in favor of Arcalas, upholding the superiority of her lien over that of Pinedas unregistered
in the Rules of Court since the right to appeal is a purely statutory right. [21]
sale. Considering all these circumstances, there is no basis for the lenient application of
procedural rules in this case; otherwise, it would result in a manifest injustice and the
Even when this Court recognized the importance of deciding cases on the merits
abuse of court processes.
to better serve the ends of justice, it has stressed that the liberality in the application of
rules of procedure may not be invoked if it will result in the wanton disregard of the rules or
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Land Titles and Deeds (Finals) 2017
exception to this rule is when the counsels negligence is so gross that a party is deprived
of due process and, thus, loses life, honor or property on mere technicalities. [25] The
It is clear from these provisions that before a purchaser of land causes the
exception cannot apply to the present case, where Pineda is merely repeating arguments
registration of the transfer of the subject property in her favor, third persons, such
that were already heard and decided upon by courts of proper jurisdiction, and the
as Arcalas, cannot be bound thereby. Insofar as third persons are concerned, what validly
absolute lack of merit of the petition is at once obvious.
transfers or conveys a persons interest in real property is the registration of the deed. As
the deed of sale was unrecorded, it operates merely as a contract between the parties,
Pineda avers that she is not a party to Civil Case No. Q-96-27884, heard before
namely Victoria Tolentino as seller and Pineda as buyer, which may be enforceable
the Quezon City RTC, and that the levy on the alias writ of execution issued in Civil Case
against Victoria Tolentino through a separate and independent action. On the other
No. Q-96-27884 cannot affect her purchase of subject property. Such position runs
hand, Arcalass lien was registered and annotated at the back of the title of the subject
contrary to law and jurisprudence.
property and accordingly amounted to a constructive notice thereof to all persons, whether
or not party to the original case filed before the Quezon City RTC.
Sections 51 and 52 of Presidential Decree No. 1529, otherwise known as the
Section 51. Conveyance and other dealings by registered preference over a prior unregistered sale.[26] A registered lien is entitled to preferential
owner.An owner of registered land may convey, mortgage, lease,
charge or otherwise deal with the same in accordance with existing consideration.[27] In Valdevieso v. Damalerio,[28] the Court held that a registered writ of
laws. He may use such forms of deeds, mortgages, leases or other
voluntary instruments as are sufficient in law. But no deed, mortgage, attachment was a superior lien over that on an unregistered deed of sale and explained
lease, or other voluntary instrument, except a will purporting to
the reason therefor:
convey or affect registered land shall take effect as a conveyance
or bind the land, but shall operate only as a contract between the
parties and as evidence of authority to the Register of Deeds to
This is so because an attachment is a proceeding in rem. It is against
make registration.
the particular property, enforceable against the whole world. The
attaching creditor acquires a specific lien on the attached property
The act of registration shall be the operative act to convey or
which nothing can subsequently destroy except the very dissolution of
affect the land insofar as third persons are concerned, and in all
the attachment or levy itself. Such a proceeding, in effect, means that
cases under this Decree, the registration shall be made in the office of
the property attached is an indebted thing and a virtual condemnation
the Register of Deeds for the province or the city where the land lies.
of it to pay the owners debt. The lien continues until the debt is paid, or
(Emphasis provided.)
sale is had under execution issued on the judgment, or until the
judgment is satisfied, or the attachment discharged or vacated in some
Section 52. Constructive notice upon registration.Every conveyance,
manner provided by law.
mortgage, lease, lien, attachment, order, judgment, instrument or entry
affecting registered land shall, if registered, filed or entered in the office
Thus, in the registry, the attachment in favor of respondent
of the Register of Deeds for the province or city where the land to which
appeared in the nature of a real lien when petitioner had his purchase
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Land Titles and Deeds (Finals) 2017
recorded. The effect of the notation of said lien was to subject and
subordinate the right of petitioner, as purchaser, to the lien. Petitioner Laguna, directing the Register of Deeds of Laguna to cancel the Notice of Adverse Claim
acquired ownership of the land only from the date of the recording of
his title in the register, and the right of ownership which he inscribed inscribed at the back of TCT No. T-52319 as Entry No. 324094 is SUSTAINED. No costs.
was not absolute but a limited right, subject to a prior registered lien of
respondent, a right which is preferred and superior to that of petitioner.
SO ORDERED.
Pineda also contends that her possession of the subject property cures the
defect caused by her failure to register the subject property in her name. This contention is
True, that notwithstanding the preference given to a registered lien, this Court
has made an exception in a case where a party has actual knowledge of the claimants
actual, open, and notorious possession of the disputed propertyat the time the levy or
attachment was registered. In such situations, the actual notice and knowledge of a prior
unregistered interest, not the mere possession of the disputed property, was held to be
equivalent to registration.[29]
Lamentably, in this case, Pineda did not even allege, much less prove,
that Arcalas had actual knowledge of her claim of ownership and possession of the
property at the time the levy was registered. The records fail to show that Arcalas knew of
Pinedas claim of ownership and possession prior to Pinedas filing of her third party claim
before the Quezon City RTC. Hence, the mere possession of the subject property by
Pineda, absent any proof that Arcalas had knowledge of her possession and adverse claim
IN VIEW OF THE FOREGOING, the instant Petition is DISMISSED and the assailed
Decision of the Court of Appeals in C.A. G.R. CV No. 82872, promulgated on 25 January
2005, is AFFIRMED. The Order of Branch 27 of the Regional Trial Court of Sta. Cruz,
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Land Titles and Deeds (Finals) 2017
[G.R. No. 133303. February 17, 2005] although defendant Lorenzo Uy remained the registered owner of the property attached,
yet the fact was that he was no longer the owner thereof as it was already sold earlier to
petitioner, hence, the writ of attachment was unlawful.
Respondents sought reconsideration thereof which was denied by the trial court in a
BERNARDO VALDEVIESO, petitioner, vs. CANDELARIO DAMALERIO AND AUREA resolution dated 03 January 1997.[12]
C. DAMALERIO, respondents.
From the unfavorable resolution of the trial court in the third-party claim, respondents
appealed to the Court of Appeals. The appellate court reversed the resolution and by
DECISION judgment promulgated on 25 September 1997, it declared that an attachment or levy of
CHICO-NAZARIO, J.: execution, though posterior to the sale, but if registered before the sale is registered, takes
precedence over the sale.[13] The writ of attachment in favor of the respondents, being
recorded ahead of the sale to petitioner, will therefore take precedence.
Before this Court is a Petition for Review under Rule 45 of the Rules of Court,
seeking to set aside the 25 September 1997 Decision and the 10 February 1998 Petitioner moved for reconsideration but this was denied by the Court of Appeals in
Resolution of the Court of Appeals in CA-G.R. SP No. 43082 entitled, Candelario its Resolution of 10 February 1998.[14]
Damalerio and Aurea Damalerio v. Honorable Antonio S. Alano, et al.[1]
Hence, this Petition for Review on Certiorari.
There is no dispute as to the following facts:
The sole issue in this case is whether or not a registered writ of attachment on the
On 05 December 1995, Bernardo Valdevieso (petitioner) bought from spouses land is a superior lien over that of an earlier unregistered deed of sale.
Lorenzo and Elenita Uy a parcel of land consisting of 10,000 square meters, more or less,
located at Bo. Tambler, General Santos City, and covered by Transfer Certificate of Title Petitioner maintains that he has a superior right over the questioned property
(TCT) No. T-30586.[2] because when the same was attached on 23 April 1996, this property was no longer
owned by spouses Uy against whom attachment was issued as it was already sold to
The deed of sale was not registered, nor was the title of the land transferred to petitioner on 05 December 1995. The ownership thereof was already transferred to
petitioner.[3] petitioner pursuant to Article 1477[15] in relation to Article 1498[16] of the Civil Code.
On 07 December 1995, the said property was immediately declared by petitioner for Dismissing the allegation that he slept on his rights by not immediately registering at
taxation purposes as Tax Declaration No. l6205 with the City Assessors Office. [4] least an adverse claim based on his deed of sale, petitioner avers that he promptly worked
out for the transfer of registration in his name. The slight delay in the registration, he claims
It came to pass that on 19 April 1996, spouses Candelario and Aurea Damalerio was not due to his fault but attributable to the process involved in the registration of
(respondents) filed with the Regional Trial Court (RTC) of General Santos City, a complaint property such as the issuance of the Department of Agrarian Reform clearance which was
for a sum of money against spouses Lorenzo and Elenita Uy docketed as Civil Case No. effected only after compliance with several requirements.
5748 with application for the issuance of a Writ of Preliminary Attachment.[5]
Considering the peculiar facts and circumstances obtaining in this case, petitioner
On 23 April 1996, the trial court issued a Writ of Preliminary Attachment by virtue of submits it would be in accord with justice and equity to declare him as having a superior
which the property, then still in the name of Lorenzo Uy but which had already been sold to right to the disputed property than the respondents.
petitioner, was levied. The levy was duly recorded in the Register of Deeds of General
Santos City and annotated upon TCT No. T-30586.[6] Respondents maintain the contrary view. They aver that registration of a deed of sale
is the operative act which binds the land and creates a lien thereon. Before the registration
On 06 June 1996, TCT No. T-30586 in the name of Lorenzo Uy was cancelled and, of the deed, the property is not bound insofar as third persons are concerned. Since the
in lieu thereof, TCT No. T-74439 was issued in the name of petitioner. [7] This new TCT writ of attachment in favor of respondents was registered earlier than the deed of sale to
carried with it the attachment in favor of respondents. petitioner, respondents were of the belief that their registered writ of attachment on the
subject property enjoys preference and priority over petitioners earlier unregistered deed of
On 14 August 1996, petitioner filed a third-party claim in Civil Case No. 5748 to sale over the same property. They also contend that Articles 1477 and 1498 of the Civil
discharge or annul the attachment levied on the property covered by TCT No. T-74439 on Code as cited by petitioner are not applicable to the case because said provisions apply
the ground that the said property belongs to him and no longer to Lorenzo and Elenita only as between the parties to the deed of sale. These provisions do not apply to, nor bind,
Uy.[8] third parties, like respondents, because what affects or binds third parties is the
In a resolution dated 21 October 1996, the trial court ruled for the registration of the instrument in the Register of Deeds. Furthermore, respondents argue
petitioner.[9] Citing Manliguez v. Court of Appeals[10] and Santos v. Bayhon,[11] it held that that petitioner cannot invoke equity in his favor unless the following conditions are met: (a)
the levy of the property by virtue of attachment is lawful only when the levied property the absence of specific provision of a law on the matter; and (b) if the person who invokes
indubitably belongs to the defendant. Applying the rulings in the cited cases, it opined that it is not guilty of delay. Both conditions have not been met, however, since there is a law
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Land Titles and Deeds (Finals) 2017
on the subject matter, i.e., Section 51 of Presidential Decree No. 1529, and that petitioner judgment is satisfied, or the attachment discharged or vacated in some manner provided
allegedly slept on his rights by not immediately registering an adverse claim based on his by law.
deed of sale.
Thus, in the registry, the attachment in favor of respondents appeared in the nature
We agree with the respondents. of a real lien when petitioner had his purchase recorded. The effect of the notation of said
lien was to subject and subordinate the right of petitioner, as purchaser, to the lien.
The law applicable to the facts of this case is Section 51 of P.D. No. 1529. Said Petitioner acquired ownership of the land only from the date of the recording of his title in
Section provides: the register, and the right of ownership which he inscribed was not absolute but a limited
right, subject to a prior registered lien of respondents, a right which is preferred and
Sec. 51. Conveyance and other dealings by registered owner. - An owner of registered superior to that of petitioner.[22]
land may convey, mortgage, lease, charge, or otherwise deal with the same in accordance
with existing laws. He may use such forms of deeds, mortgages, leases or other voluntary Anent petitioners reliance on the rulings laid down in Manliguez v. Court of
instruments as are sufficient in law. But no deed, mortgage, lease, or other voluntary Appeals and Santos v. Bayhon, we find the same to be misplaced. These cases did not
instrument, except a will purporting to convey or affect registered land, shall take effect as deal at all with the dilemma at hand, i.e. the question of whether or not a registered writ of
attachment on land is superior to that of an earlier unregistered deed of sale. In Santos,
a conveyance or bind the land, but shall operate only as a contract between the parties
and as evidence of authority to the Register of Deeds to make registration. what was involved were machinery and pieces of equipment which were executed upon
pursuant to the favorable ruling of the National Labor Relations Commission. A third party
claimed that the machinery were already sold to her, but it does not appear in the facts of
The act of registration shall be the operative act to convey or affect the land insofar as third the case if such sale was ever registered. Manliguez is similar to Santos, except that the
persons are concerned, and in all cases under this Decree, the registration shall be made former involved buildings and improvements on a piece of land. To stress, in both cited
in the office of the Register of Deeds for the province or city where the land lies. cases, the registration of the sale, if any, of the subject properties was never in issue.
[G.R. No. 127941. January 28, 1999] new titles in her name. On March 24, 1993, such titles were issued in petitioner Tans name
but it still carried the annotations of the two notices of lis pendens. Upon learning of the
new title of petitioner Tan, private respondent impleaded the former in his petition in CA-
G.R. No. 29869.
BIBLIA TOLEDO-BANAGA and JOVITA TAN, petitioners, On October 28, 1993, the CA set aside the August 7, 1992 and January 4, 1993
vs. COURT OF APPEALS and CANDELARIO DAMALERIO respondents. orders of the trial court and declared private respondent absolute owner of the subject
property. The CA disposed of the petition as follows:
DECISION
MARTINEZ, J.: WHERFORE, in view of the foregoing considerations, the instant petition is hereby
GRANTED. The orders issued by public respondent judge dated August 7, 1992 and
January 4, 1993 are hereby ordered SET ASIDE and a new one is hereby entered
The Court of Appeals (CA), in a decision penned by then Justice Ricardo J.
declaring petitioner as the absolute owner of the parcels of land subject of redemption for
Francisco,[1] categorically declared private respondent as the absolute owner of the land
failure of private respondent to exercise the right of redemption within the thirty (30) day
subject of this case. That decision was affirmed by this Court, became final and executory
period previously granted her by this court.[7]
and was remanded to the lower court for execution. But the Register of Deeds frustrated
private respondents judicially determined right as it refused to issue Certificates of Title in
his name on the ground that the matter should be referred en consulta to the Register of That decision became final and executory after petitioner Banagas petition for review
Deeds before petitioners title can be cancelled and a new one issued in the name of the was dismissed by this Court for lack of merit. [8] Upon motion of private respondent, the trial
winning party herein private respondent. So, for the third time, this simple redemption case court issued a writ of execution on December 27, 1994 ordering the Register of Deeds to
which commenced in the 1980s is again before this Court. reinstate the Certificates of Title in the name of the movant herein private respondent. In its
order which petitioners did not contest, the court a quo said that:
Here is a summary of the facts, over which there is no dispute:
In an action for redemption filed by petitioner Banaga, the trial court declared that Although there is no specific pronouncement in the decision of the Court of Appeals that
she had lost her right to redeem her property earlier foreclosed and which was reverts the titles to the land subjects of redemption to the defendant, the fact that it
subsequently sold at public auction to private respondent. [2] Certificates of Title covering declared the petitioner (Damalerio) as the absolute owner of the lands entitles him to writ
the said property were issued to private respondent over which petitioner Banaga of execution issuing from this court directing the Register of Deeds to reinstate his titles to
annotated on March 3, 1983 a notice of lis pendens.[3] On appeal by petitioner Banaga, the his name. As it is implied from the decision declaring him the absolute owner of the lands
CA reversed the decision of the trial court and allowed the former to redeem the property that the titles to the land be reverted to him (See Uy v. Capulong, 221 SCRA 87).
within a certain period.[4]Private respondents petition to this Court was dismissed [5] and the
decision became final. Let therefore a writ of execution issue in this case to enforce the decision of the Court of
Appeals. In this connection, the Register of Deeds of the Registry of Deeds for General
On June 11, 1992, petitioner Banaga tried to redeem the property by depositing with Santos City is hereby ordered to reinstate the titles of Candelario B. Damalerio - Transfer
the trial court the amount of redemption which was financed by her co-petitioner Certificates of Title No. T- 19570 and T-19571, both of the Registry of Deeds from General
Tan. Private respondent opposed the redemption arguing that it was made beyond the Santos City.[9]
time given to her by the court in the earlier case. However, the lower court issued an order
on August 7, 1992 upholding the redemption and ordered the Register of Deeds to cancel
But the Register of Deeds refused to comply with the writ of execution alleging that
private respondents Certificates of Title and issue new titles in the name of petitioner
Banaga.[6] When his motion for reconsideration was denied by the trial court in an order the Certificates of Title issued to petitioner Tan must first be surrendered. Accordingly,
private respondent moved to cite the Register of Deeds in contempt of court which was
dated January 4, 1993, private respondent filed a petition for certiorari with the CA which
was docketed as CA-G.R. No. 29869. On January 11, 1993, private respondent caused denied, as the trial court ruled on January 11, 1995 that the formers remedy is
the annotation of said petition as another notice of lis pendens on the Certificates of by consulta to the Commissioner of Land Registration. [10] In another order (dated March
Title. Three days later, the CA issued a temporary restraining order to enjoin the execution 29, 1996), the trial court likewise denied private respondents motion for the issuance of a
of the August 7, 1992 and January 4, 1993 orders. writ of possession ruling that the latters remedy is a separate action to declare petitioner
Tans Certificates of Title void. Aggrieved, private respondent again elevated the case to
Meanwhile, on January 7, 1993, petitioner Banaga sold the subject property to the CA via a petition for certiorari and mandamus[11] assailing the above-mentioned two
petitioner Tan with the deed of absolute sale mentioning private respondents certificate of orders of the court a quonaming as respondents the trial court judge, the Register of
title which was not yet cancelled. Notwithstanding the notice of lis pendens, petitioner Tan Deeds and the petitioners. On November 7, 1996, the CA rendered a decision granting the
subdivided the property in question under a subdivision plan, which she made not in her petition and, among others, set aside the assailed orders of the trial court. The dispositive
name but in the name of private respondent. There being no preliminary injunction issued portion of the CA decision reads:
and with the expiration of the TRO, petitioner Tan asked the Register of Deeds to issue
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Land Titles and Deeds (Finals) 2017
WHEREFORE, in view of all the foregoing considerations, the petition is GRANTED. (b) the court which rendered judgment had jurisdiction over the parties and the
Judgment is hereby rendered: subject matter;
(c) it must be a judgment on the merits;
1) setting aside the orders of the respondent judge dated January11, 1995 and
March 29, 1996; (d) and there must be between the first and second actions identity of parties,
subject matter, and cause of action.[17]
2) declaring the title issued to Biblia Toledo-Banaga, Jovita Tan and to those The judgment in the redemption suit had long become final and executory; there is
other subsequent transferee or transferees, if any, as null and void; no question that the court had jurisdiction over the parties and the subject matter; it
involves an adjudication on the merits of the case as the court discussed and passed upon
3) ordering the Register of Deeds of General Santos City to issue new petitioner Banagas right of redemption which she did not timely exercise and as a
certificates of title to Candelario Damalerio over the parcels of land in consequence, lost her claim of ownership of the lot. Both petitioners and private
question; respondent are parties to the earlier cases, disputing the same parcel of land with both
opposing parties claiming ownership thereof. Certainly, res judicata had set in. Besides,
once a judgment had become final and executory, it can no longer be disturbed no matter
4) ordering the respondent court to issue writ of execution for the enforcement
how erroneous it may be. In any case, no such error was attributed to in this case.
of this decision and of the decision in CA-G.R. SP No. 29868 (sic), as
well as a writ of possession for the delivery to petitioner Damalerio of
the Physical possession of the parcels of land subject matter of this Contrary to petitioners argument, private respondents remedy is not a direct or
case. independent civil action for cancellation of petitioner Tans titles. The facts, circumstances,
evidence and arguments invoked in this derailed final and executory decision are the very
same matters that will be established assuming such independent suit is legally
SO ORDERED.[12] warranted. It does not matter whether the former case was a redemption suit and the new
one will be for cancellation of title because the test of identity of causes of action is not in
Upon denial by the CA of their motion for reconsideration, petitioners filed the instant its form but whether the same evidence would support and establish the former and
petition for certiorari and mandamus. The Court, however, is puzzled why petitioners, in present causes of action.[18]
their petition, would seek to set aside the two orders (January 4, 1995 and March 29,
1996) of respondent judge who was not named in their petition. [13] Assuming this to be a Petitioners other contention that the execution of the final and executory decision -
mere lapsus since they also confusingly refer to Banaga and Tan as private respondent which is to issue titles in the name of private respondent - cannot be compelled
and to Damalerio as petitioner,[14] the petition is still utterly without merit. It is petitioners by mandamus because of the formality that the registered owner first surrenders her
stand (1) that petitioner Tan is a buyer in god faith and (2) that the remedy of private duplicate Certificates of Title for cancellation per Section 80 of Presidential Decree
respondent to secure the titles in his name is by consulta to the Land Registration 1529[19] cited by the Register of Deeds,[20] bears no merit. In effect, they argue that the
Commissioner and not through contempt. winning party must wait execution until the losing party has complied with the formality of
surrender of the duplicate title.Such preposterous contention borders on the absurd and
The Court is not convinced of the arguments proffered by petitioners. has no place in our legal system. Precisely, the Supreme Court had already affirmed the
By arguing that petitioner Tan was a buyer in good faith, petitioners in effect raise CAs judgment that Certificates of Title be issued in private respondents name. To file
once more the issue of ownership of the subject property. But such issue had already been another action just to compel the registered owner, herein petitioner Tan, to surrender her
clearly and categorically ruled upon by the CA and affirmed by this Court, wherein private titles constitute violation of, if not disrespect to, the orders of the highest tribunal.
respondent was adjudged the rightful and absolute owner thereof. The decision in that Otherwise, if execution cannot be had just because the losing party will not surrender her
case bars a further repeated consideration of the very same issue that has already been titles, the entire proceeding in the courts, not to say the efforts, expenses and time of the
settled with finality. To once again re-open that issue through a different avenue would parties, would be rendered nugatory. It is revolting to conscience to allow petitioners to
defeat the existence of our courts as final arbiters of legal controversies. Having attained further avert the satisfaction of their obligation because of sheer literal adherence to
finality, the decision is beyond review or modification even by this Court.[15] technicality,[21] or formality of surrender of the duplicate titles. The surrender of the
duplicate is implied from the executory decision since petitioners themselves were parties
Under the principle of res judicata, the Court and the parties, are bound by such final thereto. Besides, as part of the execution process, it is a ministerial function of the Register
decision, otherwise, there will be no end to litigation. It is to the interest of the public that of Deeds to comply with the decision of the court to issue a title and register a property in
there should be an end to litigation by the parties over a subject fully and fairly adjudicated, the name of a certain person, especially when the decision had attained finality, as in this
and an individual should not be vexed twice for the same cause. [16] All the elements of res case.
judicata are present in this case, which are:
In addition, the enforcement of a final and executory judgment is likewise a
(a) the former judgment must be final; ministerial function of the courts[22] and does not call for the exercise of discretion. Being a
ministerial duty, a writ of mandamus lies to compel its performance.[23] Moreover, it is
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Land Titles and Deeds (Finals) 2017
axiomatic that where a decision on the merits is rendered and the same has become final stated, TCT No. T-12488 was petitioners title (Annex C, Petition). Herein private
and executory, as in this case, the action on procedural matters or issues becomes moot respondent Tan was buying a land not registered in her sellers (Banagas) name, but in
and academic.[24] Thus, the so-called consulta to the Commissioner of Land Registration, that of petitioner Damalerio who had been claiming it as his own. She admitted this fact
which is not applicable herein, was only a naive and belated effort resorted to by when she had the land subdivided on February 2, 1993 not in her name but in the name of
petitioners in order to delay execution. If petitioners desire to stop the enforcement of a Candelario Damalerio (Annex Q, Reply). Evidently, she was a purchaser in bad faith
final and executory decision, they should have secured the issuance of a writ of because she had full knowledge of the flaws and defects of title of her seller, Banaga. X x
preliminary injunction,[25] but which they did not avail knowing that there exists no legal or x.
even equitable justifications to support it.
At any rate, at the time petitioner Banaga sold the property to petitioner Tan, the The notice of lis pendens registered on March 3, 1993 involving the land in question and
latter was well aware of the interest of private respondent over the lot. Petitioner Tan private respondent Tans actual knowledge of the then pending Civil Case No. 2556, where
furnished the amount used by petitioner Banaga for the attempted redemption. One who the question as to whether the redemption of the land which she financed was raised,
redeems in vain a property of another acquires notice that there could be a controversy. It rendered her a purchaser in bad faith and made the decision therein binding upon her. [30]
is for the same reason that petitioner Tan was included as party to the case filed in
court. Worse, at the time of the sale, petitioner Tan was buying a property not registered in Being a buyer in bad faith, petitioner Tan cannot acquire a better rights than her
the sellers name.This clear from the deed of absolute sale which even mentioned that the predecessor in interest,[31] for she merely stepped into the shoes of the latter. Such finding
Certificates of Title is still in the name of private respondent. It is settled that a party of bad faith is final and may not be re-opened for the law cannot allow the parties to trifle
dealing with a registered land need not go beyond the Certificate of Title to determine the with the courts.[32]
true owner thereof so as to guard or protect her interest. She has only to look and rely on
the entries in the Certificate of Title. By looking at the title, however, petitioner Tan cannot With respect to the issue of possession, such right is a necessary incident of
feigned ignorance that the property is registered in private respondents name and not in ownership.[33] The adjudication of ownership to private respondent includes the delivery of
the name of the person selling to her. Such fact alone should have at least prompted, if not possession since the defeated parties in this case has not shown by what right to retain
impelled her to investigate deeper into the title of her seller - petitioner Banaga, more so possession of the land independently of their claim of ownership which was
when such effort would not have entailed additional hardship, and would have been quite rejected.[34] Otherwise, it would be unjust if petitioners who has no valid right over the
easy, as the titles still carried the two notices of lis pendens. property will retain the same.[35] Thus, the CA correctly disagreed with the trial courts order
denying private respondents motion for writ of possession for the following reasons cited in
By virtue of such notices, petitioner Tan is bound by the outcome of the litigation its decision:
subject of the lis pendens. As a transferee pendente lite, she stands exactly in the shoes of
the transferor and must respect any judgment or decree which may be rendered for or 1. The order violates the doctrine laid down in Javier vs. Court of Appeals, 224
against the transferor. Her interest is subject to the incidents or results of the pending suit, SCRA 704, which ruled that the issuance of title in favor of a purchaser in bad
and her Certificates of Title will, in that respect, afford her no special protection. [26] faith does not exempt the latter from complying with the decision adverse to his
predecessor in interest, nor preclude him from being reached by writ of
To repeat, at the time of the sale, the person from whom petitioner Tan bought the execution;
property is neither the registered owner nor was the former authorized by the latter to sell
the same. She knew she was not dealing with the registered owner or a representative of 2. Private respondent Tan was a party respondent in CA-G.R. SP No. 29869,
the latter. One who buys property with full knowledge of the flaws and defects in the title of she having been impleaded in a supplemental petition, which this Court gave
his vendor is enough proof of his bad faith[27] and cannot claim that he acquired title in due course and required the respondents to file their answer. The fact that she
good faith as against the owner or of an interest therein.[28] When she nonetheless did not file any pleading, nor intervene therein did not excuse her from being
proceeded to buy the lot, petitioner Tan gambled on the result of litigation. [29] She is bound bound by the decision, otherwise all that a party respondent was to fold his arm
by the outcome of her indifference with no one to blame except herself if she looses her to prevent him from being bound by a decision in a case. Her securing titles
claim as against one who has a superior right or interest over the property. These are the over the land during the pendency of said case did not protect her from the
undeniable and uncontroverted facts found by the CA, which petitioners even quote and effects of said decision. The validity of tile of a purchaser of registered land
cite in their petition. As aptly concluded by the CA that petitioner Tan is indeed a buyer in depends on whether he had knowledge, actual or constructive, of defects in
bad faith on which the Court agrees: the title of his vendor. If he has such knowledge, he is a purchaser in bad faith
and acquires the land subject to such defects (X x x indicates that citations of
authorities omitted) The title secured by a purchaser in bad faith is a nullity and
Notwithstanding her constructive and actual knowledge that Damalerio was claiming the gave the latter no right whatsoever, as against the owner (x x x).
land, that the land was in his name, and it was involved in pending litigation, Jovita Tan
bought it from Banaga on January 7, 1993. The deed of sale recites that the parcels of 3. Private respondent Tans titles and those of her predecessor, Banaga, arose
land sold were covered by Transfer Certificates of Title No. __ (formerly [T-12488] T-530) from the void orders of August 7, 1992 and January 4, 1993. Since a void order
and TCT No. __ (formerly [T-12488] T-530) (sic) and TCT No. __ (formerly P-1294). could not give rise to valid rights, said titles were also necessarily null and void
(Annex F, Petition). Apart from the fact that Banaga was without any TCT, as above (x x x).
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
4. Private respondents and respondent Judge executed the questioned orders SPOUSES LETICIA & JOSE ERVIN ABAD, SPS.
of August 7, 1993 and January 4, 1993, pending review of said orders in CA- ROSARIO AND ERWIN COLLANTES, SPS. RICARDO
G.R. SP No. 29869. The nullification of said orders by this out imposed upon AND FELITA ANN, SPS. ELSIE AND ROGER LAS PIAS, G.R. No. 189239
the private respondents the obligation to return the property to Damalerio and LINDA LAYDA, RESTITUTO MARIANO, SPS. ARNOLD
upon respondent Judge, upon motion for execution, to order the cancellation of AND MIRIAM MERCINES, SPS. LUCITA AND Present:
private respondents titles and the issuance of new titles to him. WENCESLAO A. RAPACON, SPS. ROMEO AND EMILYN
HULLEZA, LUZ MIPANTAO, SPS. HELEN AND CARPIO MORALES, Chairperson
5. This Court in its decision in CA-G.R. SP No. 29869 declared petitioner ANTHONY TEVES, MARLENE TUAZON, SPS. ZALDO BRION,
Damalerio absolute owner of the property in question. Private respondents AND MIA SALES, SPS. JOSEFINA AND JOEL YBERA, BERSAMIN
were parties litigants in said case, who did not claim possession of the land SPS. LINDA AND JESSIE CABATUAN, SPS. WILMA AND VILLARAMA, JR., and
separately from their claim of ownership thereof. Such being the case, the MARIO ANDRADA, SPS. RAYMUNDO AND ARSENIA SERENO, JJ.
delivery of possession is considered included in this Courts decision declaring LELIS, FREDY AND SUSANA PILONEO,
Damalerio absolute owner of the property (x x x), which can be enforced by Petitioners,
writ of possession (x x x). In denying petitioners motion for writ of possession,
the trial court violated said doctrines, and
- versus -
6. Lastly, the effect of respondent Judges order of March 29, 1996 is to re-open
the decision in CA-G.R. SP No. 29689 for re-litigation and alteration in a
separate action. For while this Court already declared that Banagas
redemption of the land financed by private respondent Tan was invalid, and as
FIL-HOMES REALTY and DEVELOPMENT
a consequence declared Damalerio absolute owner of the property, which was
CORPORATION and MAGDIWANG REALTY Promulgated:
binding against private respondent Tan, as she was a respondent therein and
CORPORATION,
a purchaser pendente lite and in bad faith, the order of the respondent Court
Respondents.
holding that another civil action be filed to annul private respondent Tans titles
November 24, 2010
would be to re-litigate such issues and modify or alter this Courts final decision.
x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -- - - - - - - - - - - - - - - - - - - x
The respondent Court has no authority to do so. [36]
WHEREFORE, premises considered, the petition is hereby DENIED and the assailed
decision of the Court of Appeals is AFFIRMED in toto with costs against petitioners. No
further proceeding will be entertained in this case.
DECISION
SO ORDERED.
CARPIO MORALES, J.:
(respondents), co-owners of two lots situated in Sucat, Paraaque City and covered by
Transfer Certificates of Title Nos. 21712 and 21713, filed a complaint for unlawful detainer
on May 7, 2003 against above-named petitioners before the Paraaque Metropolitan Trial
Court (MeTC).
Respondents alleged that petitioners, through tolerance, had occupied the subject lots
Petitioners countered that there is no possession by tolerance for they have been in The MeTC held that as no payment had been made to respondents for the lots, they still
adverse, continuous and uninterrupted possession of the lots for more than 30 years; and maintain ownership thereon. It added that petitioners cannot claim a better right by virtue
that respondents predecessor-in-interest, Pilipinas Development Corporation, had no title of the issuance of a Writ of Possession for the project beneficiaries have yet to be named.
to the lots. In any event, they contend that the question of ownership must first be settled
before the issue of possession may be resolved. On appeal, the Regional Trial Court (RTC), by Decision of September 4,
2008,[2] reversed the MeTC decision and dismissed respondents complaint in this wise:
During the pendency of the case or on June 30, 2004, the City of Paraaque filed
x x x The court a quo ruled that the case filed by plaintiffs (respondents
expropriation proceedings covering the lots before the Regional Trial Court of Paraaque herein) is unlawful detainer as shown by the allegations of the
Complaint. The ruling of the court a quo is not accurate. It is not the
with the intention of establishing a socialized housing project therein for distribution to the allegations of the Complaint that finally determine whether a case
is unlawful detainer, rather it is the evidence in the case.
occupants including petitioners. A writ of possession was consequently issued and a
There is also another serious lapse in the ruling of the court a Respecting the issuance of a writ of possession in the expropriation proceedings, the
quo that the case for expropriation in the Regional Trial Court would not
bar, suspend or abate the ejectment proceedings. The court a quo had appellate court, citing Republic v. Gingoyon,[8] held the same does not signify the
failed to consider the fact that the case for expropriation was already
decided by the Regional Trial Court, Branch 196 way back in the year completion of the expropriation proceedings. Thus it disposed:
2006 or 2 years before the court a quo rendered its judgment in the
unlawful detainer case in the year 2008. In fact, there was already a
Writ of Possession way back in the year 1996 (sic) issued in the WHEREFORE, premises considered, the instant Petition is
expropriation case by the Regional Trial Court, Branch 196. The court GRANTED. The assailed Decision of the Court a quo is REVOKED and
a quo has no valid reason to disregard the said final judgment and SET ASIDE. The Decision of the Metropolitan Trial Court dated March
the writ of possession already issued by the Regional Trial Court 3, 2008 is hereby REINSTATED with MODIFICATION [by] deleting the
in favor of the City of Paraaque and against Magdiwang Realty award for attorneys fees.
Corporation and Fil-Homes Realty Development Corporation and
make another judgment concerning possession of the subject SO ORDERED. (underscoring supplied)
properties contrary to the final judgment of the Regional Trial
Court, Branch 196.[4] (emphasis in the original)
Petitioners motion for reconsideration was denied by Resolution dated August 26, 2009,
to vacate nor filing an ejectment case against them amounts to acquiescence or tolerance
In the exercise of the power of eminent domain, the State expropriates private
of their possession.[5]
property for public use upon payment of just compensation. A socialized housing project
falls within the ambit of public use as it is in furtherance of the constitutional provisions on
By Decision of May 27, 2009,[6] the appellate court, noting that petitioners did not present
social justice.[9]
evidence to rebut respondents allegation of possession by tolerance, and considering
petitioners admission that they commenced occupation of the property without the
As a general rule, ejectment proceedings, due to its summary nature, are not suspended
permission of the previous owner Pilipinas Development Corporation as indicium of
or their resolution held in abeyance despite the pendency of a civil action regarding
tolerance by respondents predecessor-in-interest, ruled in favor of respondents. Held the
ownership.
appellate court:
Where the defendants entry upon the land was with plaintiffs
tolerance from the date and fact of entry, unlawful detainer proceedings
may be instituted within one year from the demand on him to vacate Section 1 of Commonwealth Act No. 538[10] enlightens, however:
upon demand. The status of such defendant is analogous to that of a
tenant or lessee, the term of whose lease, has expired but whose
Section 1. When the Government seeks to acquire, through
occupancy is continued by the tolerance of the lessor. The same rule
purchase or expropriation proceedings, lands belonging to any estate
applies where the defendant purchased the house of the former lessee,
or chaplaincy (cappellania), any action for ejectment against the
who was already in arrears in the payment of rentals, and thereafter
tenants occupying said lands shall be automatically suspended, for
occupied the premises without a new lease contract with the
such time as may be required by the expropriation proceedings or the
landowner.[7]
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Land Titles and Deeds (Finals) 2017
necessary negotiations for the purchase of the lands, in which latter The first is concerned with the determination of the authority of the
case, the period of suspension shall not exceed one year. plaintiff to exercise the power of eminent domain and the propriety of its
exercise in the context of the facts involved in the suit. It ends with an
To avail himself of the benefits of the suspension, the tenants order, if not of dismissal of the action, "of condemnation declaring that
shall pay to the landowner the current rents as they become due the plaintiff has a lawful right to take the property sought to be
or deposit the same with the court where the action for ejectment has condemned, for the public use or purpose described in the complaint,
been instituted. (emphasis and underscoring supplied) upon the payment of just compensation to be determined as of the date
of the filing of the complaint x x x.
The second phase of the eminent domain action is concerned with the
Petitioners did not comply with any of the acts mentioned in the law to avail of the benefits determination by the court of "the just compensation for the property
sought to be taken." This is done by the court with the assistance of not
of the suspension. They nevertheless posit that since the lots are the subject of more than three (3) commissioners x x x .
It is only upon the completion of these two stages that expropriation is
expropriation proceedings, respondents can no longer assert a better right of possession; said to have been completed. The process is not complete until
payment of just compensation. Accordingly, the issuance of the writ of
and that the City Ordinance authorizing the initiation of expropriation proceedings possession in this case does not write finis to the expropriation
proceedings. To effectuate the transfer of ownership, it is necessary for
designated them as beneficiaries of the lots, hence, they are entitled to continue staying the NPC to pay the property owners the final just
compensation.[12] (emphasis and underscoring supplied)
there.
Lintag v. National Power Corporation[11] clearly outlines the stages of thereof. For certain requirements must be met and complied with before they can be
In allowing several years to pass without requiring the occupant Jesus A. Avancea for plaintiff-appellant.
to vacate the premises nor filing an action to eject Lourdes Gaspar Bautista in her own behalf as defendant-appellee.
him, plaintiffs have acquiesced to defendants possession Assistant Solicitor General Antonio Torres, Solicitor Francisco J. Bautista and Special
and use of the premises. It has been held that a person Attorney Daniel G. Florida for defendants-appelles Director of Lands, et al.
who occupies the land of another at the latters tolerance or
permission, without any contract between them,
FERNANDO, J.:
is necessarily bound by an implied promise that he will
vacate upon demand, failing which a summary action for
ejectment is the proper remedy against them. The status of the The question this appeal from a judgment of a lower court presents is one that possesses
defendant is analogous to that of a lessee or tenant whose term both novelty and significance. It is this: What is the right, if any, of a creditor which
of lease has expired but whose occupancy continued by previously satisfied its claim by foreclosing extrajudicially on a mortgage executed by the
tolerance of the owner. In such a case, the unlawful deprivation debtor, whose title was thereafter nullified in a judicial proceeding where she was not
or withholding of possession is to be counted from the date of brought in as a party?
the demand to vacate. (emphasis and underscoring supplied)
As creditor, the Development Bank of the Philippines now appellant, filed a complaint
against one of its debtors, Lourdes Gaspar Bautista, now appellee, for the recovery of a
sum of money representing the unpaid mortgage indebtedness, which previously had been
Respondents bought the lots from Pilipinas Development Corporation in 1983. They
wiped out with the creditor bank acquiring the title of the mortgaged property in an
extrajudicial sale. Thereafter, the title was nullified in a judicial proceeding, the land in
stepped into the shoes of the seller with respect to its relationship with petitioners. Even if
question being adjudged as belonging to another claimant, without, however, such debtor,
early on respondents made no demand or filed no action against petitioners to eject them as above noted, having been cited to appear in such court action.
from the lots, they thereby merely maintained the status quo allowed petitioners The Development Bank was unsuccessful, the lower court being of the view that with the
due process requirement thus flagrantly disregarded, since she was not a party in such
possession by tolerance. action where her title was set aside, such a judgment could in no wise be binding on her
and be the source of a claim by the appellant bank. The complaint was thus dismissed by
the lower court, then presided by Judge, now Justice, Magno Gatmaitan of the Court of
Appeals. Hence, this appeal by appellant bank.
WHEREFORE, the petition for review is DENIED.
Such dismissal is in accordance with law. There is no occasion for us to repudiate the
lower court.
From the very statement of facts in the brief for appellant bank, the following appears: "On
or before May 31, 1949, the defendant-appellee, Lourdes Gaspar Bautista, who shall
hereafter be referred to as Bautista, applied to the Government for the sale favor of a
parcel of land with an area of 12 has., 44 ares, and 22 centares, located at Bo. Barbara,
San Jose, Nueva Ecija. After proper investigation, Sales Patent no. V-132 covering said
property was issued in her favor on June 1, 1949 (Exh. A-1) by the Director of Lands.
Sales Patent No. V-132 was registered in the office of the Register of Deeds of Nueva
Ecija pursuant to Section 122 of Act 496 on June 3, 1949 (Exh. A), as a result of which
Original Certificate of Title No. P-389 was issued in her favor."1
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Land Titles and Deeds (Finals) 2017
How the loan was contracted by now appellee Bautista was therein set forth. Thus: "On had acquired her title by such extrajudicial foreclosure sale and thus, through its own act,
July 16, 1949, Bautista applied for a loan with the Rehabilitation Finance Corporation seen to it that her obligation had been satisfied, it could not thereafter, seek to revive the
(RFC), predecessor in interest of the plaintiff-appellee Development Bank of the same on the allegation that the title in question was subsequently annulled, considering
Philippines (DBP), offering as security the parcel of land covered by O.C.T. No. P-389. that she was not made a party on the occasion of such nullification.
Aside from her certificate of title, Bautista also submitted to the RFC other documents to
show her ownership and possession of the land in question, namely, Tax Declaration No. If it were otherwise, then the cardinal requirement that no party should be made to suffer in
5153 (Exh. A-4) in her name and the blueprint plan of the land. On the basis of the person or property without being given a hearing would be brushed aside. The doctrine
documents mentioned and the appraisal of the property by its appraiser, the RFC consistently adhered to by this Court whenever such a question arises in a series of
approved a loan of P4,000.00 in favor of Bautista. On July 16, 1949, Bautista executed the decisions is that a denial of due process suffices to cast on the official act taken by
mortgage contract over the property covered by O.C.T. No. P-389 and the promissory note whatever branch of the government the impress of nullity. 5
for P4,000.00 in favor of RFC (Exhs. C and C-1), after which the proceeds of the loan were
released."2
A recent decision, Macabingkil v. Yatco,6 possesses relevance. "A 1957
decision, Cruzcosa v. Concepcion, is even more illuminating in so far as the availability of
The satisfaction of the mortgage debt with the acquisition of the title to such property by the remedy sought is concerned. In the language of this Court, speaking through Justice
appellant Bank, by virtue of an extrajudicial foreclosure sale, and such title losing its J.B.L. Reyes: 'The petition is clearly meritorious. Petitioners were conclusively found by the
validity in view of a court proceeding, where however, appellee Bautista, was not made a Court of Appeals to be co-owners of the building in question. Having an interest therein,
party, was next taken up in the brief of plaintiff-appellant. Thus: "Bautista failed to pay the
they should have been made parties to the ejectment proceedings to give them a chance
amortization on the loan so that the RFC took steps to foreclose the mortgage extra- to protect their rights: and not having been made parties thereto, they are not bound and
judicially under Act 3135, as amended. In the ensuing auction sale conducted by the
can not be affected by the judgment rendered therein against their co-owner Catalino
sheriff of Nueva Ecija on June 27, 1951, the RFC acquired the mortgaged property as the Cruzcosa. Jr. ....' Two due process cases deal specifically with a writ of execution that
highest bidder (Exh. D). On the date of the sale, the total obligation of Bautista with the could not validly be enforced against a party who was not given his day in court, Sicat v.
RFC was P4,858.48 (Exh. I). On July 21, 1952, upon failure of Bautista to redeem the Reyes, and Hamoy v. Batingoplo. According to the former: 'The above agreement, which
property within the one (1) year period as provided bylaw, plaintiff-appellant RFC served as basis for the ejectment of Alipio Sicat, cannot be binding and conclusive upon
consolidated its ownership thereon (Exhs. E and E-I). On July 26, 1952, the Register of the latter, who is not a party to the case. Indeed, that order, as well as the writ of
Deeds of Nueva Ecija cancelled O.C.T. No. P-389 and replaced it with T.C.T. No. NT- execution, cannot legally be enforced against Alipio Sicat for the simple reason that he
12108 in the name of the RFC (Exhs. F and F-1). On or about this time, however, an was not given his day in court.' From the latter: 'The issue raised in the motion of Rangar is
action (Civil Case No. 870) was filed by Rufino Ramos and Juan Ramos in the Court of not involved in the appeal for it concerns a right which he claims over the property which
First Instance of Nueva Ecija against the Government of the Republic of the Philippines
has not so far been litigated for the reason that he was not made a party to the case either
and the RFC (as successor in interest of Bautista) claiming ownership of the land in as plaintiff for a defendant. He only came to know of the litigation when he was forced out
question and seeking the annulment of T.C.T. No. 2336 in the name of the Government,
of the property by the sheriff, and so he filed the present motion to be heard and prove his
O.C.T. No. P-389 in the name of Bautista and T.C.TG. No. NT-12108 in the name of the title to the property. This he has the right to do as the most expeditious manner to protect
RFC. A decision thereon was rendered on June 27, 1955 (Exhs. G, G-1, and G-3) whereby his interest instead of filing a separate action which generally is long, tedious and
the aformentioned certificates of title were declared null and void." 3 protracted.'"
Why the complaint had to be dismissed was explained thus in the decision now on appeal: Reinforcement to the above conclusion comes from a codal provision. According to the
"The Court after examining the proofs, is constrained to sustain her on that; it will really Civil Code:7 "The vendor shall not be obliged to make good the proper warranty, unless he
appear that she had never been placed within the jurisdiction of the Nueva Ecija Court; as is summoned in the suit for eviction at the instance of the vendee. "While not directly in
the action there was one to annual the title, it was an action strictly in personam, if that was point, the principle on which the above requirement is based sustains the decision of the
the case as it was, the judgment there could not in any way bind Lourdes who had not lower court. In effect, appellant bank would hold appellee Bautista liable for the warranty
acquired in said decision in any way for what only happened is that as to the mortgage, the on her title, its annullment having the same effect as that of an eviction. In such a case, it
Bank foreclosed, and then sold unto Conrada and when the title had been annulled, the
is wisely provided by the Civil Code that appellee Bautista, as vendor, should have been
Bank reimbursed Conrada; stated otherwise, the annulment of Lourdes' title was a summoned and given the opportunity to defend herself. In view of her being denied her
proceeding ex parte as far as she was concerned and could not bind her at all; and her
day in court, it would to be respected, that she is not "obliged to made good the proper
mortgage was foreclosed an the Bank realized on it, when the Bank afterwards acquiesced warranty."
in the annulment of the title and took it upon itself to reimburse Conrada, the Bank was
acting on its own peril because it could not have by that, bound Lourdes at all." 4
In the suit before the lower court, the Director of Lands and the National Treasurer of the
Philippines were likewise made defendants by appellant bank because of its belief that if
As stated at the outset, the decision must be affirmed. The fundamental due process no right existed as against appellee Bautista, recovery could be had from the Assurance
requirement having been disregarded, appellee Bautista could not in any wise be made to
Fund. Such a belief finds no support in the applicable, law, which allows recovery only
suffer, whether directly or indirectly, from the effects of such decision. After appellant bank
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
upon a showing that there be no negligence on the part of the party sustaining any loss or Sometime in 1966, Francisco Fernandez, Torres' brother-in-law, filed a petition with the
damage or being deprived of any land or interest therein by the operation of the Land Court of First Instance of Manila, docketed as LRC GLRO Cad. Rec. No. 133, where he,
Registration Act.8This certainly is not the case here, plaintiff-appellant being solely misrepresenting to be the attorney-in-fact of Torres and falsely alleging that the a duplicate
responsible for the light in which it now finds itself. Accordingly, the Director of Lands and copy of TCT No. 53628 was lost, succeeded in obtaining a court order for the issuance of
the National Treasurer of the Philippines are likewise exempt from any liability. another copy of the certificate.
WHEREFORE, the judgment appealed from is affirmed, with costs against the Once in possession thereof, Fernandez forged a simulated deed of sale of the realties in
Development Bank of the Philippines. his favor. Whereupon TCT No. 53628 in the name of Torres was canceled and TCT No.
86018 was issued in Fernandez' name.
On various dates from December, 1966 to November, 1967 Fernandez mortgaged the
realties to Rosario Mota, wife of Ernesto Cue, and also to Angela Fermin, who later
assigned her credit to the spouses Cue. The mortgages were annotated at the back of
G.R. No. L-63046 June 21, 1990 TCT No. 86018 and so was the deed of assignment.
MARIANO TORRES Y CHAVARRIA, petitioner, Torres, who up to this time still had possession of his owner's duplicate certificate of title
vs. and who was still collecting rentals from the occupants of the subject building, upon
THE HONORABLE COURT OF APPEALS, FRANCISCO E. FERNANDEZ and FE Teaming of the fraud committed by Fernandez, caused, on March 18, 1968, the annotation
FERNANDEZ, ROSARIO MOTA CUE, ERNESTO MEDINA CUE and the NATIONAL on the latter's TCT a notice of adverse claim.
TREASURER, as Custodian of the Assurance Fund, respondents.
On March 30, 1968, Torres filed Civil Case No. 72494 against Fernandez to annul TCT
Bengzon, Zarraga, Narciso, Cudala, Pecson, Azcuna & Bengzon for petitioner. No. 86018 as well as the proceedings in LRC GLRO Cad. Rec. No. 133. On April 2, 1968,
a notice of lis pendens was annotated at the back of Fernandez' TCT.
MEDIALDEA, J.: After the foreclosure was enjoined, the parties entered into an amicable settlement,
approved by the court whereby it was stipulated that Fernandez acknowledged and
This is a petition for review of the decision of the Court of Appeals in CA-G.R. No. 62248-R promised to pay his debt to the Cues for Five Hundred Sixty-Two Thousand Nine Hundred
entitled "Mariano Torres Y Chavarria v. Francisco E. Fernandez, et al., etc.," which Fifty-Five and 28/100 (P562,955.28) Pesos on or before, March 30, 1970, while the
reversed the decision of the then Court of First Instance of Manila, Branch 7, by holding spouses bound themselves to execute and deliver, within ten (10) days from receipt of the
that it is the respondent Rosario Mota who is legally entitled to the disputed realties, being sum mentioned such documents as are necessary to release the mortgages in favor of
an innocent mortgagee and later the highest bidder when the properties were supposedly defendants on plaintiffs' property.
foreclosed, and not the petitioner Mariano Torres, the defrauded owner thereof; and of the
resolution of that Court denying Torres' motion for reconsideration. Before Fernandez could pay his obligation under the settlement agreement, a decision
was rendered in Civil Case No. 72494 where it was declared that the proceedings held in
The parcel of land located at the comer of Quezon Boulevard and Raon Street (now LRC GLRO Cad. Rec, No. 133 was void and that TCT No. 86018, issued in the name of
Gonzalo Street), and the building erected thereon known as "M. Torres Building" is owned Fernandez, is without force and effect as TCT No. 53628 in the name of Torres is the true
by Mariano Torres, the herein petitioner, as evidenced by Transfer Certificate of Title No. and legal evidence of ownership of the subject immovables. Fernandez appealed from this
53628-Manila issued in his name. As far as the records show, Torres was and still is in decision to the Court of Appeals where it was docketed as CA-G.R. No. 46386-R. The
possession of the realties, holding safely to his owner's duplicate certificate of title, and, at Court of Appeals, on April 20, 1979, affirmed the decision of the trial court. There being
least until 1971, paying the real estate taxes due thereon, and collecting rentals from his nothing on the records that would indicate that the judgment of the appellate court was
tenants occupying the building. elevated here, it would appear that it had become final and executory.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
But meanwhile, prior to the Court of Appeals' decision mentioned above, Fernandez failed holder for value, for in such a case the new certificate is binding upon the owner (Sec. 55,
to comply with his obligation under the amicable settlement and whereupon the Cues Act 496; Sec. 53, P.D. No. 1529). But if the owner holds a valid and existing certificate of
applied for and were granted a writ of execution. The subject realties were then levied title, his would be indefeasible as against the whole world, and not that of the innocent
upon and sold at public auction where Rosario Mota was the highest bidder. holder's. "Prior tempore potior jure" as We have said in Register of Deeds v. Philippine
National Bank, No. L-17641, January 30, 1965, 13 SCRA 46 , citing Bank, No. L Legarda
On August 31, 1971, the redemption period for the subject immovables having lapsed v. Saleeby, 31 Phil. 590, Roman Catholic Bishop v. Philippine Railway, 49 Phil. 546, Reyes
without Fernandez nor Torres redeeming the properties, Rosario Mota was issued the v. Borbon, 50 Phil. 791. in C.N. Hodges v. Dy Buncio & Co., Inc., No. L-16096, October 30,
Sheriffs Deed of Sale. Thereafter, TCT No. 86018 was canceled and TCT No. 105953 was 1962, 6 SCRA 287, 292, We laid down the doctrine that:
issued in her name.
The claim of indefeasibility of the petitioner's title under the Torrens
On December 7, 1971 Mota, through her lawyer, notified the tenants occupying "M. Torres land title system would be correct if previous valid title to the same
Building" that she is the new owner thereof and henceforth, payment of their rentals should parcel of land did not exist. The respondent had a valid title ... It never
be made to her. parted with it; it never handed or delivered to anyone its owner's
duplicate of the transfer certificate of title, it could not be charged with
negligence in the keeping of its duplicate certificate of title or with any
On December 17, 1971 Torres filed a complaint, which later gave rise to this petition, with act which could have brought about the issuance of another certificate
the Court of First Instance of Manila, docketed as Civil Case No. 85753, against upon which a purchaser in good faith and for value could rely. If the
Fernandez and his spouse and the Cues to restrain the latter from collecting rentals and petitioner's contention as to indefeasibility of his title should be upheld,
for the declaration as void TCT No. 105953. The Cues in turn filed a cross-claim against then registered owners without the least fault on their part could be
Fernandez spouses and a third party complaint against the National Treasurer as the divested of their title and deprived of their property. Such disastrous
custodian of the Assurance Fund. results which would shake and destroy the stability of land titles had not
been foreseen by those who had endowed with indefeasibility land titles
During the proceeding, Mariano Torres, having died sometime in 1974, was substituted by issued under the Torrens system. Veronica Bareza perpetrated the
his widow. On June 3, 1977, the trial court rendered its decision declaring TCT No. 105953 fraud by making false representations in her petition and the title issued
in the name of Rosario Mota nun and void as it upheld the validity of TCT No. 53628 in the to her being the product of fraud could not vest in her valid and legal
name of Torres as the true evidence of title to the disputed realties, and at the same time title to the parcel of land in litigation. As she had no title to the parcel of
dismissing the Cue's third party complaint and cross claim. land, in the same way that a thief does not own or have title to the
stolen goods, she could not transmit title which she did not have nor
possess.
The decision was reviewed by the respondent court at the instance of the Cues which, as
aforementioned, reversed the trial court in its decision dated July 30, 1982 and the
Resolution of January 14, 1983. Hence, this petition. We have applied this doctrine in the case of the Register of Deeds v. P.N.B., supra, where
We noted that said ruling is "a mere affirmation of the recognized principle that a certificate
is not conclusive evidence of title if it is shown that the same land had already been
There is nothing on the records which shows that Torres performed any act or omission registered and an earlier certificate for the same land is in existence." Again in the case
which could have jeopardized his peaceful dominion over his realties. The decision under of Baltazar v. Court of Appeals, G.R. No. 78728, December 8, 1988, 168 SCRA 354, We
review, however, in considering Mota an innocent mortgagee protected under Section 55 held that as between two persons both of whom are in good faith and both innocent of any
of the Land Registration Law, held that Torres was bound by the mortgage. Inevitably, it negligence, the law must protect and prefer the lawful holder of registered title over the
pronounced that the foreclosure sale, where Mota was the highest bidder, also bound transfer of a vendor bereft of any transmissible rights.
Torres and concluded that the certificate of title issued in the name of Mota prevails over
that of Torres'. As correctly pointed out by Torres, however, his properties were sold on
execution, and not on foreclosure sale, and hence, the purchaser thereof was bound by his In view of the foregoing, to hold, for the purpose of enforcing the mortgage, that Mota was
notice of adverse claim and lis pendens annotated at the back of Fernandez' TCT. an innocent mortgagee would be futile because, as above shown, no certificate of title
Moreover, even if We grant Mota the status of an innocent mortgagee, the doctrine relied covering the subject realties in derogation of Torres' certificate of title may validly be
upon by the appellate court that a forged instrument may become the root of a valid title, issued.
cannot be applied where the owner still holds a valid and existing certificate of title
covering the same interest in a realty. The doctrine would apply rather when, as in the Then it becomes evident that the remaining possible remedies of the Cues are to go
cases for example of De la Cruz v. Fable, 35 Phil. 144 [1916], Fule v. De Legare, No. L- against Fernandez or the Assurance Fund, as they in fact had done in the lower court by
17951, February 28, 1963, 7 SCRA 351, and Republic v. Umali, G.R. No. 80687, April 10, filing a cross claim and third party complaint. The lower court dismissed the Cues' cross-
1989, the forger thru insidious means obtains the owner's duplicate certificate of title, claim against Fernandez reasoning out that their remedy is to cause the final judgment
converts it in his name, and subsequently sells or otherwise encumbers it to an innocent
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Land Titles and Deeds (Finals) 2017
(compromise agreement) in Civil Case No. 75643 executed. This, of course, is correct ACCORDINGLY, the decision and resolution under review are REVERSED and the
since the rights and obligations of both parties had been determined in that case. decision of the then Court of First Instance, Branch 7, Manila in Civil Case No. 85753 is
REINSTATED. SO ORDERED.
The trial court also dismissed the Cues' third party complaint against the Treasurer of the
Philippines as custodian of the Assurance Fund after finding them negligent in protecting
their interest. The trial court recognized the principle that a person dealing with registered
lands need not go beyond the certificate of title but nevertheless pointed out that there are
circumstances in this case which should have put the Cues on guard and prompted them G.R. No. 199810
to investigate the property being mortgaged to them, thus:
Besides, by the course of visible dimensions of the M. Torres Building, PRESENT: VELASCO, JR, J, CHAIRPERSON, PERALTA,* BERSAMIN, REYES AND
it should be readily obvious to any one that the area of the two lots ...
covered by TCT No. 86018 cannot accommodate the building, as in TIJAM, JJ
fact it also rests upon a lot covered by TCT No. 56387, and partly upon
a lot leased by (Torres) from the City of Manila. Had (the Cues) known
of this fact would they have accepted the mortgage alone over TCT No. Promulgated: March 15, 2017
86018? The answer is obvious. And yet, to all indications, they never
bothered to look into this fact about the M. Torres Building.
Decision4 dated October 24, 2008 of the Regional Trial Court (RTC) of Davao City, Branch
We likewise take note of the manifestation of the Office of the Solicitor General that the
Cues failed to contest the ruling of the trial court negating the liability of the Assurance 16, in Civil Case No. 29,705-03, dismissing the complaint for reversion of a parcel of land.
Fund. For these reasons, We hold that the Cues' remedy merely is to go against Francisco
Fernandez or rather his estate since record shows that he died sometime in 1983.
Antecedent Facts
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Land Titles and Deeds (Finals) 2017
Consuelo Vda. de dela Cruz applied for free patent over a parcel of land constituting about The administrative protest of the protestants reached the Office of the Secretary of the
1,292 square meters, designated as Lot No. 9087, Cad. 102, located in Daliao, Toril, DENR. On May 15, 1995, Secretary Angel C. Alcala rendered a Decision 14 against
Davao City. As she could not wait for the approval of her application, she executed a Deed Pagarigan, the salient portion and the fallo of which read as follows:
5 6
of Waiver/ Quitclaim on November 25, 1981 in favor of Rollie Pagarigan (Pagarigan).
From the Investigation Reports submitted by both the Departments Regional Office
7
Pagarigan filed his own Free Patent Application (FPA) and subsequently, Free Patent No. involved and this Office as well as from the other pieces of evidence available, both
(XI-I)5133 was issued to him over said lot. Original Certificate of Title (OCT) No. P- documentary and testimonial, it is obvious that actual fraud and bad faith have been
8 9
11182 was thereby issued in his name on November 25, 1982. committed by [Pagarigan] in his subject public land application which led to the issuance of
the title. The following facts and circumstances are uncontroverted, to wit; that the
On September 5, 1989, Pagarigan mortgaged the lot to Banco Davao-Davao City
[protestants] have been in actual occupation of the land in dispute since 1945 and have
Development Bank (the Bank). For failure to pay his loan, the property was foreclosed, and
introduced improvements thereon; that [Pagarigan] never occupied the same nor his
was eventually sold to the Bank at public auction on October 26, 1990. These proceedings
predecessor-in-interest, Consuelo dela Cruz, that [Pagarigan] misrepresented in his
were duly annotated in the title.10
application that he was the actual occupant and that there were no others who occupied
However, the land covered by OCT No. P-11182 was allegedly occupied by Teodoro the lot in dispute; that the title was issued sans an actual ground survey; and that
Valparaiso and Pedro Malalis (protestants). On October 24, 1990, the protestants filed a [Pagarigan] did not post a copy of his Notice for [FPA] on both the Bulletin Boards of
formal protest with the Bureau of Lands (Bureau). They prayed for the recall of the free Daliao and Lizardo as required by law.
patent issued to Pagarigan, and for the institution of a corresponding action for reversion
xxx
considering that they have been in adverse, exclusive, and continuous occupation of the
subject property since 1945, cultivating it, and planting various crops, nipa palms and WHEREFORE, the instant appeal is hereby given DUE COURSE and the subject Decision
coconut trees on said land.11 appealed from SET ASIDE and REVOKED. Consequently, the Regional Executive
Director (RED), DENR Region XI, Davao City, is hereby ordered to institute an action for
On January 27, 1992, the protestants caused the annotation of a notice of lis pendens in
cancellation of Original Certificate of Title (OCT) No. V-11182 of the Registry of Deeds of
OCT No. P-11182. Assigned as Entry No. 647677, said notice of lis pendens pertained to
Davao City covering Lot No. 9087, Cad-102, and for the reversion of the property covered
Civil Case No. 20-435-912 instituted by the protestants against Pagarigan, Menardo Metran
thereby to the government.
and Rene Galope to enjoin them from demolishing the formers houses pending the
determination of the Department of Environment and Natural Resources (DENR) on the After the cancellation of the subject title and the land already reverted to the government,
propriety of cancelling the title obtained by Pagarigan. 13 Regional Executive Director (RED) concerned shall then order the ground survey of the
land in dispute and give due course to the public land applications of the [protestants].
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Land Titles and Deeds (Finals) 2017
Meanwhile, on November 5, 1992, without consolidating title over the land in its name, the SO ORDERED.20
Bank sold the subject property to herein petitioner Beverly Anne C. Yap (Yap) and
Ruling of the RTC
Rosanna F. Villamor (Villamor). Upon the execution of the deed of sale, OCT No. P-11182
was delivered to them and Transfer Certificate of Title No. 36698316 was eventually issued On May 22, 2003, the respondent, through the Office of the Solicitor General (OSG), filed
in the name of Yap and Villamor on December 16, 2003. 17 the Complaint for Cancellation of Patent, Nullification of Title and Reversion with the RTC
complaint for expropriation of a portion of the subject lot before the RTC of Davao City, On October 24, 2008, the RTC Branch 16 rendered a Decision22 dismissing the
Branch 13, docketed as Civil Case No. 25,084-97.18 respondents complaint. The court ruled that since the subject land has already been sold
to third persons, it must be shown that the latter were part of the fraud and/or
On February 19, 2003, the RTC Branch 13 rendered its Decision. 19 Confronted with the
misrepresentation committed by the original grantee, or at least were aware of it. However,
issue of who among the claimants shall be entitled to just compensation, the trial court
since the RTC Branch 13 already declared in its decision in Civil Case No. 25,084-97 that
ruled in this wise:
Yap and Villamor were purchasers in good faith and for value of the land in question, RTC
WHEREFORE, it is the judgment of this court that[:] Branch 16 maintained that, as a court of co-equal jurisdiction, it is bound by the said
finding under the principle of conclusiveness of judgment. Moreover, the fact that it took
1. The plaintiff is entitled to expropriate the land subject of this case for the purpose of road
the respondent 26 years, from the issuance of the free patent before it instituted an action
right of way to the Davao Fish Port, which is for public use;
for reversion, militates against its cause. The fallo of the trial courts decision reads:
3. [Villam or and Yap] are the ones entitled to the payment of just compensation for the
Defendants [sic] [Bank] and Pagarigan compulsory counterclaim[s] are likewise dismissed
property subject of this case, and plaintiff is directed to pay the said amount to the said
in the absence of proof that there was malice or bad faith on [the respondents] part when
defendants;
it sought the reversion of the property.
SO ORD[E]RED.23
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Ruling of the CA III. Whether or not the decision of the CA runs counter to the rule on res judicata.32
The respondent elevated its case to the CA. On June 30, 2011, the CA rendered the Yap asserts that she and Villamor purchased the subject property in good faith and for
assailed Decision24 reversing that of the trial court. In so ruling, the CA adopted the value. She maintains that on its face, nothing appears in OCT No. P-11182 indicating that
findings of the DENR as to the commission of fraud by Pagarigan in his FPA, and held that some other person has a right to, or interest over the property covered thereby. As such,
neither the Bank nor Yap and Villamor were innocent purchasers for value. Further, the CA there was no obligation on their part to look beyond the certificate of title to determine the
maintained that the decision of the RTC Branch 13 did not constitute res judicata insofar legal condition of the concerned property.
as the same has not yet attained finality. The fallo of the CA decision reads:
Granting that a notice of lis pendens was annotated in OCT No. P-11182 filed before the
WHEREFORE, We GRANT the appeal and REVERSE the decision of the [RTC]. We Register of Deeds of Davao City, the same, however, was not offered in evidence and
declare Free Patent No. (XI-I)5133 and [OCT] No. P-11182 issued in the name of should not have been considered. Accordingly, the presumption that Yap and Villamor
[Pagarigan], and [TCT] No. T-366983 in the name of [Yap] and [Villamor], and all were purchasers in good faith and for value was not effectively rebutted.
subsequent [TCTs] derived therefrom, as null and void. We order the reversion of Lot
Moreover, in the case for expropriation heard before the RTC Branch 13, they were
9087, Cad. 102, [l]ocated in Daliao, Toril, Davao City, to the mass of public domain.
already adjudged as innocent purchasers for value. Under the principle of res judicata, it
SO ORDERED.25 was but proper for RTC Branch 16 to uphold said pronouncement. Accordingly, it was an
motion was evenly denied in the Resolution29dated November 14, 2011. Invoking the Courts ruling in Saad Agro-Industries,33 Yap asserts that the respondent
failed to discharge the burden of proving the alleged fraud and misrepresentation which
Hence this petition filed solely by Yap.
attended Pagarigans FPA.
I. Whether or not the decision of the CA is not in accord with the applicable decision
Yaps contentions are untenable.
enunciated by the Court in the case of Spouses Macadangdang v. Spouses Martinez;30
The decision of the CA does not run counter to the rule on conclusiveness of
II. Whether or not the CA departed from the rule declared by the Court in the case of Saad
judgment.
Agro-Industries, Inc. v. Republic of the Philippines, 31 that in reversion proceedings the
same must be proved by clear and convincing evidence, mere preponderance of evidence Yap asserts that the CA erred in setting aside the decision of RTC Branch 16 in violation of
not even being adequate; and the rule on res judicata. It was a finding already made by the RTC Branch 13, a co-equal
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Land Titles and Deeds (Finals) 2017
branch that the land is now in the hands of innocent purchasers for value. Thus, the issues in another litigation between the same parties on a different claim or cause of
respondents complaint for reversion must be dismissed on the basis of the principle of action.
conclusiveness of judgment.
The general rule precluding the re-litigation of material facts or questions which were in
The Court does not agree. issue and adjudicated in former action are commonly applied to all matters essentially
connected with the subject matter of the litigation. Thus, it extends to questions necessarily
In a catena of cases, the Court discussed the doctrine of conclusiveness of judgment, as a
implied in the final judgment, although no specific finding may have been made in
concept of res judicata as follows:
reference thereto and although such matters were directly referred to in the pleadings and
The second concept - conclusiveness of judgment - states that a fact or question which were not actually or formally presented. Under this rule, if the record of the former trial
was in issue in a former suit and was there judicially passed upon and determined shows that the judgment could not have been rendered without deciding the particular
by a court of competent jurisdiction, is conclusively settled by the judgment therein matter, it will be considered as having settled that matter as to all future actions between
as far as the parties to that action and persons in privity with them are concerned the parties and if a judgment necessarily presupposes certain premises, they are as
and cannot be again litigated in any future action between such parties or their conclusive as the judgment itself. 34 (Emphasis and underlining ours, and emphasis in the
privies, in the same court or any other court of concurrent jurisdiction on either the original deleted)
same or different cause of action, while the judgment remains unreversed by proper
In Nabus v. CA,35 the Court stressed that when a party seeks relief upon a cause of action
authority. It has been held that in order that a judgment in one action can be conclusive
different from the one asserted by him in a previous one, the judgment in the former suit
as to a particular matter in another action between the same parties or their privies, it is
is conclusive only as to such points or questions as were actually in issue or
essential that the issue be identical. If a particular point or question is in issue in the
adjudicated therein.36 However, in Calalang v. Register of Deeds of Quezon City,37 the
second action, and the judgment will depend on the determination of that particular point or
Court clarified that the bar on re-litigation of a matter or question extends to those
question, a former judgment between the same parties or their privies will be final and
questions necessarily implied in the final judgment, although no specific finding may have
conclusive in the second if that same point or question was in issue and adjudicated in the
been made in reference thereto, and although those matters were directly referred to in the
first suit xxx. Identity of cause of action is not required but merely identity of issue.
pleadings and were not actually or formally presented.38If the record of the former trial
Justice Feliciano, in Smith Bell & Company (Phils.), Inc. v. Court of Appeals x x x, shows that the judgment could not have been rendered without deciding a particular
reiterated Lopez v. Reyes x x x in regard to the distinction between bar by former judgment matter, it will be considered as having settled that matter as to all future actions
which bars the prosecution of a second action upon the same claim, demand, or cause of between the parties.39 Verily, as developed, these principles now embody paragraph (c)
action, and conclusiveness of judgment which bars the relitigation of particular facts or of Section 47, Rule 39 of the Rules of Court, which reads:
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Land Titles and Deeds (Finals) 2017
(c) In any other litigation between the same parties or their successors in interest, that only Defendants Yap and Villamor for their part, dispute the claim of [the protestants]. They
is deemed to have been adjudged in a former judgment or final order which appears upon alleged that they were buyers in good faith of the property, and in fact, the owners copy of
its face to have been so adjudged, or which was actually and necessarily included therein OCT No. P-11182 has been delivered to them by [the Bank], They alleged that the title
or necessary thereto. which was issued to [Pagarigan] cannot be attacked collaterally as in this case. There
should be a case filed in court to annul the title if indeed the same was fraudulently issued.
Guided by the foregoing, the Court finds that RTC Branch 16 falsely appreciated the
For as long as the title is not yet declared null and void, the same remains valid, and
decision of RTC Branch 13. The Court quotes the pertinent portions of the Decision dated
whoever succeeds to the same is the owner of the land, they alleged. Moreover, since they
February 19, 2003 of the RTC Branch 13:
are purchasers in good faith, and for value, they have a right to be protected, defendants
[The protestants] claim that the decision of the Secretary of the DENR in effect conferred The Decision of the Secretary of the DENR, in the case cited by [the protestants] cannot
ownership of the land to them, so that they should be paid the compensation and not justify the court to declare that the title issued to [Pagarigan] is void, and that [the
defendants Yap and Villamor. In fact, defendant Malalis had declared the property for protestants] are the owners of the property in question.
taxation purposes, and had paid the taxes thereon from the time they had occupied the
As correctly stated by defendants Yap and Villamor in their Memorandum, a Torrens title
land.
cannot be collaterally attacked. The title must be attacked directly in a case filed in court
[The protestants] alleged that the land subject of this case is still in the name of specifically to annul the said title. The alleged fraud in the issuance of OCT No. P-11182
[Pagarigan], and OCT No. P-11182 has not yet been cancelled and transferred in the therefore cannot be raised in this case, and the court will not consider the decision of the
names of defendants Yap and Villamor, who never even set foot on the land, nor declared DENR Secretary to say that the title of [Pagarigan] is void, and that the [protestants] are
the land for taxation purposes. The alleged sale of [the Bank] of the land to Yap and the owners of the land subject of this case.
Villamor did not confer ownership of the land to them, because the land had not been
Moreover, a Torrens title has the presumption of having been validly issued, and the
delivered to them by the owner, and they have not exercised ownership over the same. In
defendants Yap and Villamor are not expected to look beyond the title to determine its
short their claim of ownership is based on a technicality, and no amount of technicality may
validity. They are purchasers in good faith and for value, and are therefore entitled to the
serve as a solid foundation for the enjoyment of the fruits of fraud, [the protestants]
protection of the court.
alleged.
Contrary to the allegation of [the protestants], there was in fact a valid delivery of the land
CLAIMS OF DEFENDANTS YAP AND VILLAMOR:
to defendants Yap and Villamor. The execution of a Deed of Sale in their favor by
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Land Titles and Deeds (Finals) 2017
defendant [Bank], and delivery to them of the owners copy of OCT No. P-11182 is a with law,43 it was clear that the trial court was without jurisdiction in an expropriation
constructive delivery of the property sold to them. proceeding, to rule whether the title issued to Pagarigan is void - notwithstanding the
decision of the DENR Secretary. Thereupon, since the position of the protestants rests
Although defendants Yap and Villamor had not taken actual physical possession of the
mainly on the validity of Pagarigans title which cannot be considered in the action, RTC
property covered by OCT No. P-11182, the same did not divest them of the ownership of
Branch 13, in effect, posited that there was no legal way for it to rule otherwise.
the land covered by the said title. The occupation and possession of [the protestants] of
the land in question did not ripen into ownership because their occupation (even in the Accordingly, and as similarly advanced by the OSG in its Comment, the RTC Branch 13s
concept of an owner) cannot defeat a Torrens title. OCT No. P-11182 is presumed to be pronouncement that Yap and Villamor were buyers in good faith was, at best, a
valid until declared void by the courts.40 mere obiter dictum. Contrary to Yaps claim, there was nothing final or conclusive with the
purchasers was not an actual issue of fact in the case before the RTC Branch 13, and Neither the Bank, nor Yap and Villamor were purchasers in good faith and for value.
which called for said courts adjudication. An issue of fact is a point supported by one Reversion of subject lot is in order.
partys evidence and controverted by anothers. 41 That Yap and Villamor were buyers in
[F]actual findings of administrative or quasi-judicial bodies, which are deemed to have
good faith is merely an allegation which was not proven in court. The RTC Branch 13 did
acquired expertise in matters within their respective jurisdictions, are generally accorded
not actually make any clear pronouncement on the matter.
not only respect but even finality, and bind the Court when supported by substantial
The expropriation proceeding was filed on February 28, 1997. The protestants caused the evidence.44
annotation of a notice of lis pendens on the original copy of OCT No. P-11182 on January
The fact that Pagarigan fraudulently secured his free patent was duly established by the
27, 1992. Accordingly, if indeed the question on whether Yap and Villamor are buyers in
investigation conducted by the DENR through Senior Special Investigator Domingo
good faith was an actual issue of fact before the expropriation proceeding, the protestants
Mendez. The decision of the DENR is very clear in this regard, thus:
could have easily controverted such claim by the mere expedience of presenting a certified
original copy of OCT No. P-11182. Forsooth, the notice at the back of a Torrens title From the Investigation Reports submitted by both the Departments Regional Office
serves as notice to the whole world of the pending controversy over the land so involved and this Office as well as from the other pieces of evidence available, both
42
registered. documentary and testimonial, it is obvious that actual fraud and bad faith have been
committed by [Pagarigan] in his subject public land application which led to the issuance of
The RTC Branch 13 basically anchored its judgment on the indefeasibility of a Torrens
the title. The following facts and circumstances are uncontroverted, to wit; that the
title. Pursuant to the well-settled rule that a certificate of title cannot be subject to collateral
[protestants] have been in actual occupation of the land in dispute since 1945 and have
attack and can only be altered, modified, or cancelled in a direct proceeding in accordance
introduced improvements thereon; that [Pagarigan] never occupied the same nor his
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Land Titles and Deeds (Finals) 2017
predecessor-in-interest, Consuelo dela Cruz; that [Pagarigan] misrepresented in his dealings with registered lands. Accordingly, given inter alia the suspicion-provoking
application that he was the actual occupant and that there were no others who occupied presence of occupants other than the owner on the land to be mortgaged, it behooved
the lot in dispute; that the title was issued sans an actual ground survey; and that them to conduct a more exhaustive investigation on the history of the mortgagors title.
[Pagarigan] did not post a copy of his Notice for [FPA] on both the Bulletin Boards of That appellee Bank accepted in mortgage the property in question notwithstanding the
Daliao and Lizardo as required by law. 45 existence of structures on the property and which were in actual, visible, and public
(Emphasis ours) possession of persons other than the mortgagor, constitutes gross negligence amounting
the certificate of title issued in the name of Pagarigan, and for the reversion of the land Yap and Villamor are not innocent purchasers for value.
However, as adverted to above, Section 32 of Presidential Decree No. 1529 mandates that purchased the said lot from the Bank, a notice of lis pendens was already annotated on
for a reversion case to prosper, it is not enough to prove that the original grantee of a OCT No. P-11182; hence, they cannot be considered as innocent purchasers for value.
patent has obtained the same through fraud; it must also be proven that the subject Yap and Villamor, on the other hand, contended that the owners duplicate copy they
property has not yet been acquired by an innocent purchaser for value, because fraudulent received from the Bank did not contain any annotations of encumbrance or liens; hence,
acquisition cannot affect the titles of the latter. they cannot be bound by such annotation.47
Henceforth, the ultimate resolution of this case boils down to the determination on whether In the present petition, Yap maintains that the presumption that she and Villamor are
the subsequent conveyances of the subject lot from Pagarigan were made to innocent buyers in good faith and for value has not been rebutted. She adds that even if it is
purchasers for value. Specifically, based on the records, can we regard the Bank, and assumed, for the sake of argument, that their predecessor-in-interest committed fraud and
thereafter, Yap and Villamor as innocent purchasers for value? misrepresentation, their title as innocent purchasers and for value will not in any way be
affected.48
The Court answers in the negative.
This Court cannot sanction Yaps assertion. Time and again, the Court has ruled that the
Verily, the Court is in full accord with the following disquisitions of the CA on the matter,
burden of proof to establish the status of a purchaser and registrant in good faith lies upon
thus:
the one who asserts it. This onus probandi cannot be discharged by mere invocation of the
It cannot be overemphasized that [the Bank], being in the business of extending loans legal presumption of good faith.49
secured by real estate mortgage, is familiar with rules on land registration. As such, it was,
It must be emphasized that aside from the fact that a notice of lis pendens was already
as here, expected to exercise more care and prudence than private individuals in its
annotated on OCT No. P-11182 even before Yap and Villamor purchased the subject
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property, it was also established that when they did so, the said property was still exercise such degree of precaution makes him a buyer in bad faith. 52 (Emphasis and italics
registered in the name of Pagarigan since the Bank did not consolidate its title in the original)
thereto.50 Stated simply, Yap and Villamor purchased the subject property not from
Verily, as the Court held in a catena of cases:
the registered owner.
[T]he law protects to a greater degree a purchaser who buys from the registered owner
In Trifonia D. Gabutan, et al. v. Dante D. Nacalaban, et al., 51 the Court held that:
himself. Corollarily, it requires a higher degree of prudence from one who buys from
A buyer for value in good Faith is one who buys property of another, without notice that a person who is not the registered owner, although the land object of the
some other person has a right to, or interest in, such property and pays full and fair price transaction is registered. While one who buys from the registered owner does not need
for the same, at the time of such purchase, or before he has notice of the claim or interest to look behind the certificate of title, one who buys from one who is not the registered
of some other persons in the property. He buys the property with the well-founded belief owner is expected to examine not only the certificate of title but all factual
that the person from whom he receives the thing had title to the property and capacity to circumstances necessary for him to determine if there are any flaws in the title of
To prove good faith, a buyer of registered and titled land need only show that he relied on This Court has consistently applied the stricter rule when it comes to deciding the issue of
the face of the title to the property. He need not prove that he made further inquiry for he is good faith of one who buys from one who is not the registered owner, but who exhibits a
not obliged to explore beyond the four corners of the title. Such degree of proof of good certificate of title.53 (Emphasis in the original)
faith, however, is sufficient only when the following conditions concur: firsts the
Neither estoppel nor laches lies against the respondent in the present case
seller is the registered owner of the land; second, the latter is in possession thereof;
and third, at the time of the sale, the buyer was not aware of any claim or interest of Citing the cases of Saad Agro-Industries54 and Republic of the Philippines v. CA,55 the
some other person in the property, or of any defect or restriction in the title of the RTC Branch 16 opined that in an action for reversion, the defenses of
seller or in his capacity to convey title to the property. equitable estoppel, laches and Torrens System in land titles are available - without,
however, stating that the foregoing also applies in this case, and how.
Absent one or two of the foregoing conditions, then the law itself puts the buyer on notice
and obliges the latter to exercise a higher degree of diligence by scrutinizing the certificate In any event, neither of said cases is on all fours with the present case. Said cases did not
of title and examining all factual circumstances in order to determine the sellers title and dwell on whether an FPA was granted through the employment of fraud and/or
capacity to transfer any interest in the property. Under such circumstance, it is no longer misrepresentation, nor the question of whether the concerned properties were conveyed to
sufficient for said buyer to merely show that he relied on the face of the title; he must now innocent purchasers.
also show that he exercised reasonable precaution by inquiring beyond the title. Failure to
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Land Titles and Deeds (Finals) 2017
In Saad Agro-Industries, free patent was alleged to have been mistakenly issued over a was instituted only in 2003, the circumstances leading to the institution of the case hardly
property that was claimed by therein respondent as inalienable for being part of a track of spells inaction or neglect on the part of the respondent as to be considered guilty of
land classified as forest land. However, it was established that government has not yet laches.
classified the lot in question as forest reserve prior to the issuance of the concerned free
Forsooth, there was no prolonged inaction on the part of the respondent in this case. This
patent. Moreover, it was also established that therein subject property was already
can be gleaned in the decision57 of the DENR Secretary. Shortly after the protestants filed
conveyed to an innocent purchaser for value, Saad Agro-Industries, Inc. before the action
a formal protest with the Bureau on October 24, 1990, 58 the Officer-in-Charge, Regional
for reversion was instituted.
Executive Director (RED) of the DENR Region XI, Davao City immediately ordered an
In Republic of the Philippines v. CA,56 therein petitioner instituted an action to annul the investigation on November 15, 1990,58 and the same commenced on November 19, 1990.
certificates of title that were issued on the basis of a null and void subdivision plan. While On February 14, 1994, the RED issued a decision dismissing the protestants
therein petitioner sufficiently proved that the actual area of the disputed property was protest.59Undaunted, the protestants elevated their case to the Office of the DENR
unduly enlarged in the said subdivision plan, it, however, presented no proof that therein Secretary. On May 15, 1995, the DENR Secretary set-aside the REDs decision and
respondent committed fraud when it submitted the subdivision plan to the Land ordered the institution of appropriate action for the cancellation of OCT No. P-11182, and
Registration Commission for approval. Since the plan was presumed to have been for the reversion of the property covered thereby to the government.
subjected to investigation, study and verification by said commission, there was no one to
The instant action does not undermine the indefeasibility of Torrens title
be blamed except therein petitioner, acting through said body, itself. Thus, for having
allowed and approved the subdivision plan, the government was held to be in estoppel to In the case of Lorzano v. Tabayag, Jr.,60 the Court reiterated that a Torrens title emanating
question the same, and seek the annulment of titles issued pursuant thereto. Moreover, from a free patent which was secured through fraud does not become indefeasible
when the action was instituted, the subdivided properties were already sold to innocent because the patent from whence the title sprung is itself void and of no effect whatsoever.
purchasers for value. Additionally, although therein petitioner asserted that the action was Thus:
instituted to protect the integrity of the Torrens System, it was, however, unjustifiable that it
Once a patent is registered and the corresponding certificate of title is issued, the land
took nearly 20 years before therein petitioner acted on the matter. Verily, therein
covered thereby ceases to be part of public domain and becomes private property, and the
petitioners prolonged inaction was held as tantamount to laches.
Torrens Title issued pursuant to the patent becomes indefeasible upon the expiration of
In the instant case, it was established that Pagarigans FPA was secured on the basis of one year from the date of such issuance. However, a title emanating from a free patent
his fraudulent representations. The respondent cannot be faulted for having been misled which was secured through fraud does not become indefeasible, precisely because the
into believing that an applicant is legally qualified to be granted free patent as to render it patent from whence the title sprung is itself void and of no effect whatsoever. 61
estopped from asserting its right to recover its own property. While the action for reversion
On this point, the Courts ruling in Republic v. Heirs of Felipe Alejaga, Sr. 62 is instructive:
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Land Titles and Deeds (Finals) 2017
True, once a patent is registered and the corresponding certificate of title [is] issued, the WHEREFORE, the petition is hereby DENIED. The Decision dated June 30, 2011 and
land covered by them ceases to be part of the public domain and becomes private Resolution dated November 14, 2011 of the Court of Appeals in CA-G.R. CV No. 01753-
property. Further, the Torrens Title issued pursuant to the patent becomes indefeasible a MIN are AFFIRMED. SO ORDERED.
year after the issuance of the latter. However, this 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
FRANCISCO ALONSO, substituted by MERCEDES V. G.R. No. 188471
confirms the registrants already existing one. Verily, registration under the Torrens System ALONSO, TOMAS V. ALONSO and ASUNCION V.
ALONSO,
is not a mode of acquiring ownership.63 (Citations omitted) Petitioners, Present:
pursuant to the same, may only be assailed by the government in an action for reversion, REPUBLIC OF THE PHILIPPINES, represented by the Promulgated:
OFFICE OF THE SOLICITOR GENERAL,
pursuant to Section 101 of the Public Land Act. In Sherwill Development Corporation v. Public Respondent. April 20, 2010
Sitio Sto. Nino Residents Association, Inc.,64 the Court pointed out that:
It is also 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
x-----------------------------------------------------------------------------------------x
indefeasibility of a title over land previously public is not a bar to an investigation by the
DECISION
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 BERSAMIN, J.:
65
title in order that the appropriate action for reversion may be filed by the Government.
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By petition for review on certiorari, the petitioners appeal the order dated December 28, Francisco subsequently found that the certificate of title covering Lot No. 727-D-2
2007 of the Regional Trial Court (RTC), Branch 20, in Cebu City, denying the motion for of the Banilad Friar Lands Estate had been administratively reconstituted from the owners
issuance of writ of execution of the Office of the Solicitor General (OSG) in behalf of the duplicate of Transfer Certificate of Title (TCT) No.RT-1310 in the name of United Service
Government, and the order dated April 24, 2009, denying their motion for Country Club, Inc., the predecessor of respondent Cebu Country Club, Inc (Cebu Country
reconsideration filed against the first order. Club); and that upon the order of the court that had heard the petition for reconstitution of
the TCT, the name of the registered owner in TCT No. RT-1310 had been changed to that
Antecedents of Cebu Country Club; and that the TCT stated that the reconstituted title was a transfer
Club,[1] which follow. It is relevant to mention at this point that the current TCT covering Lot 727-D-2 in
the name of Cebu Country Club is TCT No. 94905, which was entered in the land records
Petitioner Francisco M. Alonso (Francisco) was the only son and sole heir of the of Cebu City on August 8, 1985.[5]
late spouses Tomas N. Alonso and Asuncion Medalle. Francisco died during the pendency
of this case, and was substituted by his legal heirs, namely: his surviving spouse, With his discoveries, Francisco formally demanded upon Cebu Country Club to
Mercedes V. Alonso, his son Tomas V. Alonso (Tomas) and his daughter Asuncion V. restore the ownership and possession of Lot 727-D-2 to him. However, Cebu Country Club
Alonso.[2] denied Franciscos demand and claim of ownership, and refused to deliver the possession
to him.[6]
Alonso had acquired Lot No. 727 of the Banilad Friar Lands Estate from the Government in On September 25, 1992, Francisco commenced against Cebu Country Club in
or about the year 1911; that the original vendee of Lot No.727 had assigned his sales the RTC in Cebu City an action for the declaration of nullity and non-existence of deed/title,
certificate to Tomas N. Alonso, who had been consequently issued Patent No. 14353; and the cancellation of certificates of title, and the recovery of property. On November 5, 1992,
that on March 27, 1926, the Director of Lands had executed a final deed of sale in favor of Cebu Country Club filed its answer with counterclaim.[7]
Tomas N. Alonso, but the final deed of sale had not been registered with the Register of
On May 7, 1993, the RTC decided in favor of Cebu Country Club.
Deeds because of lack of requirements, like the approval of the final deed of sale by the
Both parties appealed to the Court of Appeals (CA), which ultimately affirmed the and reconstituted titles covering the Banilad Friar Lands Estate in Cebu City. This was
RTC on March 31, 1997. Thus, Francisco filed a motion for reconsideration, which was Republic Act No. 9443,[13] effective on July 27, 2007.
Thereafter, both Cebu Country Club and the OSG brought the passage of R.A.
Nothing daunted, Francisco appealed to this Court (G.R. No. 130876).
No. 9443 to the attention of the RTC for its consideration in resolving the OSGs motion for
On January 31, 2002, this Court decided G.R. No. 130876, decreeing: the issuance of a writ of execution.[14] On December 28, 2007, therefore, the RTC denied
the OSGs motion for the issuance of a writ of execution through the first appealed order.[15]
WHEREFORE, we DENY the petition for review. However, we
SET ASIDE the decision of the Court of Appeals and that of the The petitioners filed a motion for reconsideration dated February 1, 2008,
Regional Trial Court, Cebu City, Branch 08.
questioning the denial of the OSGs motion for the issuance of a writ of execution.[16]
IN LIEU THEREOF, we DISMISS the complaint and
counterclaim of the parties in Civil Cases No. CEB 12926 of the trial
court. We declare that Lot No. 727 D-2 of the Banilad Friar Lands
Estate covered by Original Certificate of Title Nos. 251, 232, and 253 Upon being directed by the RTC to comment on the petitioners motion for
legally belongs to the Government of the Philippines. [9]
reconsideration, the OSG manifested in writing that the Government was no longer
seeking the execution of the decision in G.R. No. 130876, subject to its reservation to
The petitioners sought a reconsideration. On December 5, 2003, however, the
contest any other titles within the Banilad Friar Lands Estate should clear evidence show
Court denied their motion for reconsideration.[10] Hence, the decision in G.R. No.
such titles as having been obtained through fraud. [17]
130876 became final and executory.
After the filing of the OSGs comment, the RTC issued the second appealed
In late 2004, the Government, through the OSG, filed in the RTC a motion for the
order, denying the petitioners motion for reconsideration, giving the following reasons:
issuance of a writ of execution.[11] Cebu Country Club opposed the motion for the issuance
of a writ of execution in due course. 1. The party who had a direct interest in the execution of the decision
and the reconsideration of the denial of the motion for execution
was the Government, represented only by the OSG; hence, the
petitioners had no legal standing to file the motion for
Later on, the proceedings on the OSGs motion for the issuance of a writ of reconsideration, especially that they were not authorized by the
OSG for that purpose;
execution at the instance of Cebu Country Club in deference to the on-going hearings
2. R.A. No. 9443 confirms and declares as valid all existing TCTs
being conducted by the Committee on Natural Resources of the House of Representatives and reconstituted titles; thereby, the State in effect waived and
divested itself of whatever title or ownership over the Banilad Friar
on a proposed bill to confirm the TCTs and reconstituted titles covering the Banilad Friar Lands Estate in favor of the registered owners thereof, including
Lot 727 D-2; and
Lands Estate in Cebu City.[12] The Congress ultimately enacted a law to validate the TCTs
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Land Titles and Deeds (Finals) 2017
3. The situation of the parties had materially changed, rendering the Memorandum No. 16, both of which in fact made their predecessor
enforcement of the final and executory judgment Tomas N. Alonsos sales certificate and patent valid. [19]
unjust, inequitable, and impossible, because Cebu Country Club
was now recognized by the State itself
as the absolute owner of Lot 727 D-2.[18]
Contentions of the Petitioners 1. Whether or not the petitioners were the real parties-in-interest to
question the denial by the RTC of the OSGs motion for the
issuance of a writ of execution;
The petitioners challenge the orders dated December 28, 2007 and April 29, 2. Whether or not R.A. No. 9443 gave the petitioners a legal interest
to assail the RTCs orders; and
2009, because:
3. Whether or not the petitioners can appeal by petition for review
on certiorari in behalf of the OSG.
1. R.A. No. 9443 did not improve Cebu Country Clubs plight,
inasmuch as R.A. No. 9443 presupposed first a sales certificate
that lacked the required signature, but Cebu Country Club did not
have such sales certificate. Moreover, the titleholders were in fact Ruling
the owners of the lands covered by their respective titles, which
was not true with Cebu Country Club due to its being already
adjudged with finality to be not the owner of Lot727-D-2. Lastly,
Cebu Country Clubs title was hopelessly defective, as found by The petition for review is denied due course.
the Supreme Court itself;
2. The doctrine of law of the case barred the application of R.A. No.
A.
9443 to Cebu Country Club;
Preliminary Considerations:
Petitioners contravene the hierarchy of courts,
3. The RTCs declaration that R.A. No. 9443 confirmed Cebu Country
and the petition is fatally defective
Club as the absolute owner of Lot 727-D-2 despite the prior and
final judgment of the Supreme Court that Cebu Country Club was
not the owner was unconstitutional, because it virtually allowed the
legislative review of the Supreme Courts decision rendered against
Cebu Country Club; Before delving on the stated issues, the Court notes that the petitioners are guilty
4. The use of R.A. No. 9443 as a waiver on the part of the of two violations that warrant the immediate dismissal of the petition for review
Government vis--vis Cebu Country Club was not only misplaced
but downrightly repugnant to Act 1120, the law governing the legal on certiorari.
disposition and alienation of Friar Lands; and
5. The petitioners had the requisite standing to question the patent The first refers to the petitioners breach of the hierarchy of courts by coming
errors of the RTC, especially in the face of the unholy conspiracy
between the OSG and Cebu Country Club, on the one hand, and, directly to the Court to appeal the assailed issuances of the RTC via petition for review
on the other hand, the passage of R.A. No. 9443 and DENR
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on certiorari. They should not have done so, bypassing a review by the Court of Appeals 1997 Rules of Civil Procedure, which demands that an appeal by petition for review
(CA), because the hierarchy of courts is essential to the efficient functioning of the courts on certiorari be limited to questions of law.[22]
and to the orderly administration of justice. Their non-observance of the hierarchy of courts
has forthwith enlarged the docket of the Court by one more case, which, though it may not The second violation concerns the omission of a sworn certification against forum
seem burdensome to the layman, is one case too much to the Court, which has to devote shopping from the petition for review on certiorari. Section 4, Rule 45 of the 1997 Rules of
time and effort in poring over the papers submitted herein, only to discover in the end that Civil Procedure requires that the petition for review should contain, among others, the
a review should have first been made by the CA. The time and effort could have been sworn certification on the undertakings provided in the last paragraph of Section 2, Rule 42
dedicated to other cases of importance and impact on the lives and rights of others. of the 1997 Rules of Civil Procedure, viz:
Section 2. xxx
The hierarchy of courts is not to be lightly regarded by litigants. The CA stands
The petitioner shall also submit together with the petition a
between the RTC and the Court, and its establishment has been precisely to take over certification under oath that he has not theretofore commenced any
other action involving the same issues in the Supreme Court, the Court
much of the work that used to be done by the Court.Historically, the CA has been of the of Appeals or different divisions thereof, or any other tribunal or agency;
if there is such other action or proceeding, he must state the status of
greatest help to the Court in synthesizing the facts, issues, and rulings in an orderly and the same; and if he should thereafter learn that a similar action or
proceeding has been filed or is pending before the Supreme Court, the
intelligible manner and in identifying errors that ordinarily might escape detection. The Court of Appeals, or different divisions thereof, or any other tribunal or
agency, he undertakes to promptly inform the aforesaid courts and
Court has thus been freed to better discharge its constitutional duties and perform its most other tribunal or agency thereof within five (5) days therefrom. (n)
important work, which, in the words of Dean Vicente G. Sinco, [20] is less concerned with the
decision of cases that begin and end with the transient rights and obligations of particular Only petitioner Tomas V. Alonso has executed and signed the sworn certification against
individuals but is more intertwined with the direction of national policies, momentous forum shopping attached to the petition. Although neither of his co-petitioners Mercedes V.
economic and social problems, the delimitation of governmental authority and its impact Alonso and Asuncion V. Alonso has joined the certification, Tomas did not present any
upon fundamental rights.[21] written express authorization in his favor authorizing him to sign the certification in their
behalf. The signing of the certification by only one of the petitioners could not be presumed
The need to elevate the matter first to the CA is also underscored by the reality to reflect the personal knowledge by his co-petitioners of the filing or non-filing of any
that determining whether the petitioners were real parties in interest entitled to bring this similar action or claim.[23] Hence, the failure of Mercedes and Asuncion to sign and execute
appeal against the denial by the RTC of the OSGs motion for the issuance of a writ of the certification along with Tomas warranted the dismissal of their petition. [24]
execution was a mixed question of fact and law. As such, the CA was in the better position
to review and to determine. In that regard, the petitioners violate Section 1, Rule 45 of the B.
Petitioners are not proper parties
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Land Titles and Deeds (Finals) 2017
to appeal and assail the order of the RTC was that the deed of sale executed by the Director of Lands was
not approved by the Secretary of Agriculture and Natural
Resources. Hence, the deed of sale was void. Approval by the
Secretary of Agriculture and Commerce is indispensable for the validity
of the sale. Moreover, Cebu Country Club, Inc. was in possession of
The petitioners are relentless in insisting that their claim to Lot No. 727-D-2 of the
the land since 1931, and had been paying the real estate taxes thereon
based on tax declarations in its name with the title number indicated
Banilad Friar Lands Estate should be preferred to that of Cebu Country Club, despite the
thereon. Tax receipts and declarations of ownership for taxation
final judgment in G.R. No. 130876 being adverse to their claim. Their insistence raises the purposes are strong evidence of ownership. This Court has ruled that
although tax declarations or realty tax payments are not conclusive
need to resolve once and for all whether or not the petitioners retained any legal right to evidence of ownership, nevertheless, they are good indicia of
possession in the concept of owner for no one in his right mind will be
assert over Lot No. 727-D-2 following the Governments manifest desistance from the paying taxes for a property that is not in his actual or constructive
possession.
execution of the judgment in G.R. No. 130876 against Cebu Country Club.
Notwithstanding this fatal defect, the Court of Appeals ruled that
there was substantial compliance with the requirement of Act No. 1120
to validly convey title to said lot to Tomas N. Alonso.
The above-noted defects of the petition for review notwithstanding, therefore, the
On this point, the Court of Appeals erred.
Court has now to address and resolve the stated issues on the sole basis of the results the
Under Act No. 1120, which governs the administration and
Court earlier reached in G.R. No. 130876. In this regard, whether or not the petitioners are disposition of friar lands, the purchase by an actual and bona fide
settler or occupant of any portion of friar land shall be agreed upon
the proper parties to bring this appeal is decisive. between the purchaser and the Director of Lands, subject to the
approval of the Secretary of Agriculture and Natural Resources (mutatis
mutandis).
After careful consideration, the Court finds that the cause of the petitioners In his Memorandum filed on May 25, 2001, the Solicitor General
submitted to this Court certified copies of Sale Certificate No. 734, in
instantly fails. favor of Leoncio Alburo, and Assignment of Sale Certificate No. 734, in
favor of Tomas N. Alonso. Conspicuously, both instruments do not bear
the signature of the Director of Lands and the Secretary of the Interior.
They also do not bear the approval of the Secretary of Agriculture and
In G.R. No. 130876, the Court found that the petitioners did not validly acquire Natural Resources.
ownership of Lot No. 727-D-2, and declared that Lot No. 727 D-2 legally belonged to the Only recently, in Jesus P. Liao v. Court of Appeals, the Court
has ruled categorically that approval by the Secretary of Agriculture
Government, thus:
and Commerce of the sale of friar lands is indispensable for its
validity, hence, the absence of such approval made the sale null and
void ab-initio. Necessarily, there can be no valid titles issued on the
The second issue is whether the Court of Appeals erred in ruling basis of such sale or assignment. Consequently, petitioner
that the Cebu Country Club, Inc. is owner of Lot No. 727. Franciscos father did not have any registerable title to the land in
question. Having none, he could not transmit anything to his sole
Admittedly, neither petitioners nor their predecessor had any heir, petitioner Francisco Alonso or the latters heirs.
title to the land in question. The most that petitioners could claim was
that the Director of Lands issued a sales patent in the name of Tomas In a vain attempt at showing that he had succeeded to the
N. Alonso. The sales patent, however, and even the corresponding estate of his father, on May 4, 1991, petitioner Francisco Alonso
deed of sale were not registered with the Register of Deeds and no executed an affidavit adjudicating the entire estate to himself (Exh.
title was ever issued in the name of the latter. This is because there Q), duly published in a newspaper of general circulation in the province
were basic requirements not complied with, the most important of which and city of Cebu (Exh. Q-1). Such affidavit of self-adjudication is
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Land Titles and Deeds (Finals) 2017
denial.[30] However, its manifest desistance from the execution of the decision effectively
The pronouncement in G.R. No. 130876 renders beyond dispute that the non- barred any challenge against the denial, for its non-appeal rendered the denial final and
execution of the judgment would not adversely affect the petitioners, who now hold no right immutable.
whatsoever in Lot No. 727-D-2. Otherwise put, they are not the proper parties to assail the
C.
questioned orders of the RTC, because they stand to derive nothing from the execution of R.A. No. 9443 gives petitioners no legal interest
to assail the denial of the motion for execution
the judgment against Cebu Country Club.
Reconstituted Certificates of Title duly issued by the Register of Deeds of Cebu Province
Thus, an appeal, like this one, is an action to be prosecuted by a party in interest and/or Cebu City covering any portion of the Banilad Friar Lands Estate, and
before a higher court. In order for the appeal to prosper, the litigant must of necessity recognizes the registered owners as absolute owners. To benefit from R.A. No. 9443,
continue to hold a real or present substantial interest that entitles him to the avails of the
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Land Titles and Deeds (Finals) 2017
therefore, a person must hold as a condition precedent a duly issued Transfer Certificate
On the question that TCT No. RT-1310 (T-11351) bears the
of Title or a Reconstituted Certificate of Title. same number as another title to another land, we agree with the Court
of Appeals that there is nothing fraudulent with the fact that Cebu
Country Club, Inc.s reconstituted title bears the same number as
the title of another parcel of land. This came about because under
Although Lot 727-D-2 was earlier declared to be owned by the Government in General Land Registration Office (GLRO) Circular No. 17, dated
February 19, 1947, and Republic Act No. 26 and Circular No. 6, RD 3,
G.R. No. 130876, R.A. No. 9443 later validated Cebu Country Clubs registered ownership dated August 5, 1946, which were in force at the time the title was
reconstituted on July 26, 1948, the titles issued before the inauguration
due to its holding of TCT No. RT-1310 (T-11351) in its own name. As the OSG explained of the Philippine Republic were numbered consecutively and the titles
issued after the inauguration were numbered also consecutively
in its manifestation in lieu of comment[31] (filed in the RTC vis--vis the petitioners motion for starting with No. 1, so that eventually, the titles issued before the
inauguration were duplicated by titles issued after the inauguration of
reconsideration against the RTCs denial of the OSGs motion for issuance of a writ of the Philippine Republic. xxx.
xxx
execution), the enactment of R.A. No. 9443 had mooted the final and executory Decision
Petitioners next argue that the reconstituted title of Cebu
Country Club, Inc. had no lawful source to speak of; it was
of the Supreme Court in Alonso v. Cebu Country Club, Inc., docketed as G.R. No. 130876,
reconstituted through extrinsic and intrinsic fraud in the absence
of a deed of conveyance in its favor. In truth,
which declared the Government as the owner of Lot 727-D-2 based on the absence of
however, reconstitution was based on the owners duplicate of the
signature and approval of the then Secretary of Interior; and that the decision in G.R. No. title, hence, there was no need for the covering deed of sale or
other modes of conveyance. Cebu Country Club, Inc. was
130876 had ceased to have any practical effect as the result of the enactment of R.A. No. admittedly in possession of the land since long before the Second
World War, or since 1931. In fact, the original title (TCT No. 11351)
9443, and had thereby become academic.[32] was issued to the United Service Country Club, Inc. on November
19, 1931 as a transfer from Transfer Certificate of Title No. 1021.
More importantly, Cebu Country Club, Inc. paid the realty taxes on
the land even before the war, and tax declarations covering the
On the other hand, the petitioners could not benefit from R.A. No. 9443 because property showed the number of the TCT of the land. Cebu Country
Club, Inc. produced receipts showing real estate tax payments
of their non-compliance with the express condition of holding any Transfer Certificate of since 1949. On the other hand, petitioner failed to produce a single
receipt of real estate tax payment ever made by his father since the
Title or Reconstituted Certificate of Title respecting Lot727-D-2 or any portion thereof. sales patent was issued to his father on March 24, 1926. Worse,
admittedly petitioner could not show any [T]orrens title ever issued to
Tomas N. Alonso, because, as said, the deed of sale executed
on March 27, 1926 by the Director of Lands was not approved by the
The appropriate recourse for the petitioners, if they persist in the belief that the Secretary of Agriculture and Natural Resources and could not be
registered. Under the law, it is the act of registration of the deed of
TCT of Cebu Country Club should be nullified, is to compel the OSG through the special conveyance that serves as the operative act to convey the land
registered under the Torrens system. The act of registration creates
civil action for mandamus to commence the action to annul on the ground that Cebu constructive notice to the whole world of the fact of such conveyance.
On this point, petitioner alleges that Cebu Country Club, Inc.
Country Club had obtained its title to Lot 7217-D-2 through fraud. Yet, that recourse is no obtained its title by fraud in connivance with personnel of the
Register of Deeds in 1941 or in 1948, when the title was
longer availing, for the decision in G.R. No. 130876 explicitly found and declared that administratively reconstituted. Imputations of fraud must be
proved by clear and convincing evidence. Petitioner failed to
the reconstituted title of Cebu Country Club had not been obtained through fraud. Said the adduce evidence of fraud. In an action for re-conveyance based on
fraud, he who charges fraud must prove such fraud in obtaining a
Court: title. In this jurisdiction, fraud is never presumed. The strongest
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Land Titles and Deeds (Finals) 2017
suspicion cannot sway judgment or overcome the presumption of G.R. No. L-79787 June 29, 1989
regularity. The sea of suspicion has no shore, and the court that
embarks upon it is without rudder or compass. Worse, the imputation APOLONIO EGAO AND BEATRIZ EGAO, petitioners,
of fraud was so tardily brought, some forty-four (44) years or sixty-
vs.
one (61) years after its supposed occurrence, that is, from the THE HONORABLE COURT OF APPEALS (NINTH DIVISION), SEVERO DIGNOS AND
administrative reconstitution of title on July 26, 1948, or from the SEVERO BONTILAO, respondents.
issuance of the original title on November 19, 1931, that verification is
rendered extremely difficult, if not impossible, especially due to
the supervening event of the second world war during which Eliud J. Pailagao for petitioners.
practically all public records were lost or destroyed, or no longer
available.[33] Guerrero A. Adaza for private respondents.
IN VIEW OF THE FOREGOING, the petition for review on certiorari is denied for
PADILLA, J.:
lack of merit.
This is a land dispute which culminated in the filing by private respondents Severo Dignos
and Severo Bontilao of a verified complaint for Quieting of Title and/or Recovery of
The Court declares that Cebu Country Club, Inc. is the exclusive owner of Lot Possession and Ownership before the RTC of Manolo Fortich, Bukidnon, * against
petitioners Apolonio and Beatriz Egao.
No.727-D-2 of the Banilad Friar Lands Estate, as confirmed by Republic Act No. 9443.
Private respondents' complaint alleged that they are the legitimate owners and possessors
Costs of suit to be paid by the petitioners. of two (2) parcels of land situated at Lonocan, Manolo Fortich, Bukidnon, per deed of
absolute sale dated 21 December 1979 which, among others, recited thus:
WHEREAS, the VENDEES herein is [sic] aware of the fact that the
Certificate of Title over the abovementioned parcels of land have not
yet been transferred in favor of ROBERTO N. MARFORI except for the
tax declarations but that the VENDOR herein is in actual, physical,
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
continuous, uninterrupted, and adverse possession of the above Marfori and Egao were both held by the Court of Appeals in pari delicto for violating the
described parcels of land free from all liens and encumbrances five (5) year restriction under Sec. 118, Commonwealth Act No. 141 as amended by Act
whatsoever; 1 No. 496 against encumbrance or alienation of lands acquired under a free patent or
homestead; hence, they cannot, according to the appellate court, seek affirmative relief,
Allegedly, upon purchase of Lot No. 662 from Roberto Marfori, improvements were but respondents on the other hand were declared innocent purchasers for value who
introduced and taxes paid by private respondents. Sometime in June 1983, herein obtained the owner's duplicate copy of the OCT (still in the name of the Egaos) from
petitioners allegedly occupied illegally portions of the land. 2 Marfori who transferred to them (respondents) physical possession of the property. Finally,
the Court of Appeals held:
Petitioners' answer to the complaint asserted that Apolonio Egao is the registered owner of
the parcel of land known as Lot No. 662, Pls 854 with an area of 3,451 sq. meters WHEREFORE, the decision appealed from is hereby SET ASIDE and a
evidenced by OCT No. P-3559 issued by the Register of Deeds of Bukidnon pursuant to new one is rendered:
Free Patent No. 298112 dated 12 August 1965; that he (Apolonio Egao) and his family
have been in actual, physical, adverse, open and continuous possession thereof even 1. Declaring the plaintiffs as the absolute owners of
before the issuance to him of the free patent; that the land has never been sold by reason the land known as Lot No. 662, Pls-854 of the Land
of the prohibition against alienation under Commonwealth Act No. 141 (Public Land Law); Registry of Bukidnon;
and that the instant case was the fourth in a series filed against the Egaos and is part of
respondents' scheme to grab said parcel of land from the petitioners. 2. Ordering the Register of Deeds of Bukidnon to
effect the cancellation of Original Certificate of Title
Judge Felicidario M. Batoy ruled in favor of the Egaos, herein petitioners (defendants in No. P-3559 in the name of Apolonio Egao and in lieu
the court a quo), ordering respondent Severo Bontilao (plaintiff in the court a quo) to thereof, another one be issued in the names of
immediately deliver to the Egaos the owner's duplicate copy of Original Certificate of Title plaintiffs, after payment of the proper fees;
No. P-3559. Said trial judge held:
3. Ordering the defendants to surrender peaceful
In the instant case, granting arguendo, that defendants executed the 2 possession of the land to plaintiffs and to desist from
documents in favor of Marfori (Exhs. A & B) after the filing of the further disturbing the possession over the land of
application for free patent but before the issuance of the latter, without plaintiffs;
the approval of the Director of Lands, upon issuance of Free Patent No.
29811 2 on August 12, 1965, the said deeds of sale (Exhs. A & B) 4. Ordering the defendants to pay the costs.
were ipso facto cancelled or superseded by said free patent. Moreover,
it appears from the evidence that defendants never vacated or
abandoned their possession of Lot No. 662 as they have continuously SO ORDERED. 5
lived on said lot since 1950, a fact admitted by the plaintiffs themselves.
And as long as Original Certificate of Title No. P-3559 remains in the Petitioners turn to this Court for relief, assailing the appellate court for allegedly committing
name of defendant Apolonio Egao, married to Beatriz Menoza Egao, grave abuse of discretion amounting to lack of jurisdiction in holding that:
this is the ultimate and best evidence of title granted by the government
which must be honored and respected by the courts. In a nutshell, the
plaintiffs miserably failed to present or show any title to Lot No. 662, a. Petitioners sold Lot 662 to Roberto Marfori;
PLS-854 which should be quieted or freed from any cloud of doubt as
prayed for in their complaint and they further failed to show that they b. It was only in 1983 when Petitioners wrested
are entitled to the ownership and possession to Lot No. 662, PLS-854. 3 possession over the land from private respondents;
Private respondents went to the Court of Appeals in CA-G.R. No. 09539. Setting aside the c. Petitioners never denied the sales made in favor
RTC decision, the appellate court ** held, in part, thus- of Marfori, in their answer;
That the land is titled in the name of defendant Apolonio Egao is not in d. Private Respondents are "innocent purchasers for
question. The main point in issue is whether defendants could validly value. 6
sell the land to Marfori who in turn transferred ownership thereof to the
plaintiff. 4
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
and/or for allegedly deciding questions of substance not in accordance with law and/or A Torrens title, once registered, cannot be defeated, even by adverse open and notorious
applicable decisions of this Court. possession. A registered title under the Torrens system cannot be defeated by
prescription. The title, once registered, is notice to the world. All persons must take notice.
No one can plead ignorance of the registration. 12
Without giving due course to the petition, the Court required respondents to
comment. 7 After comment, the Court resolved to require petitioners to file a reply, which
they did. Respondents filed a rejoinder. Considering the allegations, issues and arguments Contrary to the appellate court's conclusion, respondents are not innocent purchasers for
adduced, the Court resolved to give due course to the petition. Upon submission by the value. 13 An "innocent purchaser for value" is deemed, under the Torrens system, to
parties of their respective memorandum, the petition was submitted for decision. 8 include an innocent lessee, mortgagee or other encumbrancer for value. 14 Where a
purchaser neglects to make the necessary inquiries and closes his eyes to facts which
Validity of the Deeds of Sale executed between Marfori (as purchaser) and the petitioners should put a reasonable man on his guard as to the possibility of the existence of a defect
(as sellers) is the main issue to be resolved, in determining respondents' right over the in his vendor's title, and relying on the belief that there was no defect in the title of the
disputed land, the respondents being the transferees of Marfori. vendor, purchases the property without making any further investigation, he cannot claim
that he is a purchaser in good faith for value. 15
It is undisputed that Free Patent No. 298112 was issued to petitioner Apolonio Egao over
Lot No. 662 on 12 August, 1965. Sec. 118 of Commonwealth Act No. 141, as amended, Furthermore, a private individual may not bring an action for reversion or any action which
prohibits the alienation or encumbrance, within a period of five (5) years from the date of would have the effect of cancelling a free patent and the corresponding certificate of title
issuance of the patent, of lands acquired under free patent or homestead. issued on the basis thereof, with the result that the land covered thereby will again form
Assuming, arguendo, the authenticity of the Deeds of Sale executed by the Egaos in favor part of the public domain, as only the Solicitor General or the officer acting in his stead
of Marfori over portions of Lot No. 662 (the land in question), dated 7 May 1964, 14 may do so. 16
January and 6 October 1965, it clearly appears that all deeds were executed within the
prohibited period of five (5) years. As correctly found by the appellate court- The rule of pari delicto non oritur actio (where two persons are equally at fault neither party
may be entitled to relief under the law), admits of exceptions and does not apply to an
Section 124 of the Public Land Act provided [sic] that any acquisition, inexistent contract, such as, a sale void ab initio under the Public Land Act, when its
conveyance, abenation, transfer or other contract made or executed enforcement or application runs counter to the public policy of preserving the grantee's
right to the land under the homestead law. 17
inviolation of any of the provisions of Sections 118,121,120,122 and
123 of this Act shall be unlawful, null and void from its execution and
shall produce the effect of annulling and cancelling the grant, title, Sec. 51, par. 2 of the Property Registration Decree (PD 1529), formerly Sec. 50 of the
patent or permit originally issued, recognized or confirmed, actually or Land Registration Act (Act No. 496) expressly provides that the registration of the Deed is
prescriptively, and cause the reversion of the property and its the operative act that binds or affects the land insofar as third persons are concerned. The
improvements to the state. 9 law requires a higher degree of prudence from one who buys from a person who is not the
registered owner, when the land object of the transaction is registered land. While one who
Petitioners deny the authenticity and due execution of the notarized deeds of sale in favor buys from the registered owner need not look behind the certificate of title, one who buys
from another who is not the registered owner is expected to examine not only the
of Marfori, asserting continued ownership over the land by virtue of a Torrens Certificate of
Title issued in their name. While the Court is not satisfied with respondents' explanation of certificate of title but all factual circumstances necessary for him to determine if there are
their failure to present the notaries public (who were residents of a neighboring province) any flaws in the title of the transferor, or in his capacity to transfer the land. Failing to
to affirm their participation in the preparation of the Deeds, the Court also finds as exercise caution of any kind whatsoever is tantamount to bad faith. 18
insufficient the mere denials by petitioners as to due execution and authenticity of said
Deeds of Sale. A notarial document is evidence of the facts in clear unequivocal mariner Deeds of sale of patented lands, perfected within the prohibited five (5) year period are null
therein expressed. It has in its favor the presumption of regularity To contradict all these and void (Sec. 124, Public Land Act). No title passed from the Egaos to Marfori which
there must be evidence that is clear, convincing and more than merely could be validly transferred to herein respondents Bontilao and Dignos. Nemo dat quod
preponderant. 10 The question of authenticity being one of fact, the Court will not disturb non habet (nobody can dispose of that which does not belong to him). 19
the conclusions of the Court of Appeals on the matter.
While the government has not taken steps to assert its title, by reversion, to a homestead
Original Certificate of Title No. P-3559 over the land in dispute was issued on 1 March sold in violation of the Public Land Act, the vendor or his heirs is better entitled to the
1966, a few months after the execution by the Egaos of the last Deed of Sale in favor of possession of the said, the vendee being in no better situation than any intruder. 20
Marfori. 11 The OCT is registered in the name of the Egaos, herein petitioners.
Accordingly, respondents who are not innocent purchasers for value have no standing to
question petitioners' right to the land and to file an action for quieting of title.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
WHEREFORE, the appealed decision of the Court of Appeals in CA G.R. CV No. 09539 is G.R. No. 107751 June 1, 1995
REVERSED and SET ASIDE. Meanwhile, petitioners as registered owners are entitled to
remain in physical possession of the disputed property. Respondents are ordered to LETICIA P. LIGON, petitioner,
deliver the owner's duplicate copy of the OCT (No. P-3559) to petitioners, without prejudice
vs.
to an action for reversion of the land, which may be instituted by the Solicitor General for COURT OF APPEALS, JUDGE CELIA LIPANA-REYES, Presiding Judge, Branch 81,
the State. Regional Trial Court of Quezon City, Iglesia ni Kristo and the Register of Deeds of
Quezon City, respondent.
Let a copy of this decision be furnished the Solicitor General.
SO ORDERED.
BELLOSILLO, J.:
This is a petition for review of the decision of the Court of Appeals which affirmed the order
of the Regional Trial Court of Quezon City, Br. 82, granting the motion of respondent of
Iglesia ni Kristo to direct petitioner to surrender the owner's duplicate of the certificates of
title in her possession.
On 19 October 1990 respondent Iglesia ni Kristo (INK) filed with the Regional Trial Court of
Quezon City a complaint 1 for specific performance with damages against the Islamic
Directorate of the Philippines (IDP) docketed as Civil Case No. Q90-6937. Respondent
INK alleged in its complaint that by virtue of an Absolute Deed of Sale dated 20 April 1989
IDP sold to it two (2) parcels of land located at Tandang Sora, Barrio Culiat, Quezon City,
both of which IDP is the registered owner. The parties stipulated in the deed of sale that
the IDP shall undertake to evict all squatters and illegal occupants in the property within
forty-five (45) days from the execution of the contract.
IDP failed to fulfill this obligation. Hence INK prayed that the trial court order IDP to comply
with its obligation of clearing the subject lots of illegal occupants and to pay damages to
INK.
IDP alleged in its answer that it was INK which violated the contract by delaying the
payment of the purchase price and prayed that the contract of sale be rescinded and
revoked.
On 15 June 1991 INK filed a motion for partial summary judgment on the ground that there
was actually no genuine issue as to any material fact.
On 12 September 1991 the trial court rendered partial judgment, and on 7 October 1991
an amended partial judgment granting the reliefs prayed for by INK except the prayer for
damages which was to be resolved later.
On 22 January 1992 INK filed a motion in the same case praying that petitioner Leticia
Ligon, who was in possession of the certificates of title over the properties as mortgagee of
IDP, be directed to surrender the certificates to the Register of Deeds of Quezon City for
the registration of the Absolute Deed of Sale in its name. INK alleged that the document
could not be registered because of the refusal and/or failure of petitioner to deliver the
certificates of title despite repeated requests.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
On 31 January 1992 petitioner Ligon filed an opposition to the motion on the ground that Sec. 107. Surrender of withheld duplicate certificates. Where it is
the IDP was not served copy of the motion, and the ownership of the INK over the property necessary to issue a new certificate of title pursuant to any involuntary
was still in issue since rescission was sought by the IDP as a counterclaim. She prayed instrument which divests the title of the registered owner against his
that the motion be denied, but should it be granted, the Register of Deeds be directed after consent or where a voluntary instrument cannot be registered by
registration to deliver the owner's duplicate copies of the new certificates of title to her. reason of the refusal or failure of the holder to surrender the owner's
duplicate certificate of title, the party in interest may file a petition in
On 15 February 1992 petitioner filed a Supplemental Opposition questioning the court to compel surrender of the same to the Register of Deeds. The
jurisdiction of the trial court because the motion involved the registrability of the document court, after hearing, may order the registered owner or any person
of sale, and she was not made a party to the main case. withholding the duplicate certificate to surrender the same and direct
the entry of a new certificate or memorandum upon such surrender. If
the person withholding the duplicate certificate is not amenable to the
On 2 March 1992 the trial court granted the motion of INK and ordered petitioner to process of the court, or if for any reason the outstanding owner's
surrender to INK the owner's copy of RT-26521 (170567) and RT-26520 (176616) in open duplicate certificate cannot be delivered, the court may order the
court for the registration of the Absolute Deed of Sale in the latter's name and the annulment of the same as well as the issuance of a new certificate of
annotation of the mortgage executed in favor of petitioner on the new transfer certificates title in lieu thereof. Such new, certificate and all duplicates thereof shall
of title to be issued to INK.2 contain a memorandum of the annulment of the outstanding duplicate.
On 6 April 1992, on motion of petitioner Ligon, the trial court reconsidered its order by Before the enactment of P.D. No. 1529 otherwise known as the Property Registration
directing her to deliver the certificates of title to the Register of Deeds of Quezon City. 3 Decree, the former law, Act No. 496 otherwise known as the Land Registration Act, and all
jurisprudence interpreting the former law had established that summary reliefs such as an
Petitioner filed a petition for certiorari with the Court of Appeals seeking the annulment of action to compel the surrender of owner's duplicate certificate of title to the Register of
the two (2) orders. However, on 28 October 1992 the Court of Appeals dismissed the Deeds could only be filed with and granted by the Regional Trial Court sitting as a land
petition and affirmed the orders of the trial court. registration court if there was unanimity among the parties or there was no adverse claim
or serious objection on the part of any party in interest, otherwise, if the case became
contentious and controversial it should be threshed out in an ordinary action or in the case
Petitioner now comes to us alleging that the trial court erred: (a) in ruling that it had where the incident properly belonged.4
jurisdiction over petitioner; (b) in upholding the orders of the trial court even as they
violated the rule prohibiting splitting of a single cause of action and forum-shopping; (c) in
holding that INK is the owner of the property and entitled to registration of its ownership; Under Sec. 2 of P.D. No. 1529, it is now provided that "Courts of First Instance (now
and, (d) in holding that INK has a superior right to the possession of the owner's copies of Regional Trial Courts) shall have exclusive jurisdiction over all applications for original
the certificates of title. registration of titles to lands, including improvements and interest therein and over all
petitions filed after original registration of title, with power to hear and determine all
questions arising upon such applications or petitions." The above provision has eliminated
Upon prior leave, the IDP intervened alleging that prior to the issuance by the trial court of the distinction between the general jurisdiction vested in the regional trial court and the
the order of 2 March 1992, its legal Board of Trustees filed a motion for intervention limited jurisdiction conferred upon it by the former law when acting merely as a cadastral
informing said court that the sale of the properties was not executed by it but was made court. Aimed at avoiding multiplicity of suits the change has simplified registration
possible by a fake Board of Trustees, hence, the sale is void. The trial court denied the proceedings by conferring upon the regional trial courts the authority to act not only on
motion since jurisdiction over the incident properly belonged to the Securities and applications for original registration but also over all petitions filed after original registration
Exchange Commission (SEC). Conformably therewith, IDP brought the matter before the of title, with power to hear and determine all questions arising upon such applications or
SEC which later declared that the sale of the properties was void. Thus, IDP banks on this petitions.5
favorable decision in similarly seeking the nullification of the questioned orders of the trial
court.
The principal action filed by INK in Civil Case No. Q-90-6937 before the trial court was for
specific performance with damages based on a document of sale. Such action was well
Under our land registration law, no voluntary instrument shall be registered by the Register within the exclusive jurisdictions of the Regional Trial Court. 6 When IDP, the defendant in
of Deeds unless the owner's duplicate certificate is presented together with such the trial court, did not question the genuineness and validity of said deed of sale and its
instrument, except in some cases or upon order of the court for cause shown. In case the obligations thereunder, the summary judgment issued by the court granting the reliefs
person in possession of the duplicate certificates refuses or fails to surrender the same to sought by INK was also an exercise of its general jurisdiction.
the Register of Deeds so that a voluntary document may be registered and a new
certificate issued, Sec. 107, Chapter 10, of P.D. No. 1529 clearly states:
Hence, when INK filed a motion for the issuance of an order from the same court to
compel the holder of the duplicate certificates of title to surrender the same to the Register
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
of Deeds for the registration of the deed of sale subject of the principal action, the motion [G.R. No. 127941. January 28, 1999]
was a necessary incident to the main case. When the sale of the property was upheld by
the court in its judgment and the defendant was directed to comply with its terms and
conditions, the right of INK to have the same registered with the Register of Deeds could
not be disregarded. To assert and enjoy its right, INK should be allowed to seek the aid of
the court to direct the surrender of the certificates of title. Since Regional Trial Courts are BIBLIA TOLEDO-BANAGA and JOVITA TAN, petitioners,
courts of general jurisdiction, they may therefore take cognizance of this case pursuant to vs. COURT OF APPEALS and CANDELARIO DAMALERIO respondents.
such jurisdiction. 7 Even while Sec. 107 of P.D. 1529 speaks of a petition which can be DECISION
filed by one who wants to compel another to surrender the certificates of title to the
Register of Deeds, this does not preclude a party to a pending case to include as incident MARTINEZ, J.:
therein the relief stated under Sec. 107, especially if the subject certificates of title to be
surrendered are intimately connected with the subject matter of the principal action. 8 This
principle is based on expediency and in accordance with the policy against multiplicity of The Court of Appeals (CA), in a decision penned by then Justice Ricardo J.
suits. Francisco,[1] categorically declared private respondent as the absolute owner of the land
subject of this case. That decision was affirmed by this Court, became final and executory
and was remanded to the lower court for execution. But the Register of Deeds frustrated
The records of the case show that the subsisting mortgage lien of petitioner appears in the private respondents judicially determined right as it refused to issue Certificates of Title in
certificates of title Nos. 26520 and 26521. Hence, the order of the trial court directing the his name on the ground that the matter should be referred en consulta to the Register of
surrender of the certificates to the Register of Deeds in order that the deed of sale in favor Deeds before petitioners title can be cancelled and a new one issued in the name of the
of INK can be registered, cannot in any way prejudice her rights and interests as a winning party herein private respondent. So, for the third time, this simple redemption case
mortgagee of the lots. Any lien annotated on the previous certificates of title which subsists which commenced in the 1980s is again before this Court.
should be incorporated in or carried over to the new transfer certificates of title. This is true
even in the case of a real estate mortgage because pursuant to Art. 2126 of the Civil Code Here is a summary of the facts, over which there is no dispute:
it directly and immediately subjects the property upon which it is imposed, whoever the
possessor may be, to the fulfillment of the obligation for whose security it was constituted. In an action for redemption filed by petitioner Banaga, the trial court declared that
It is inseparable from the property mortgaged as it is a right in rem a lien on the property she had lost her right to redeem her property earlier foreclosed and which was
whoever its owner may be. It subsists notwithstanding a change in ownership; in short, the subsequently sold at public auction to private respondent. [2] Certificates of Title covering
personality of the owner is disregarded. Thus, all subsequent purchasers must respect the the said property were issued to private respondent over which petitioner Banaga
mortgage whether the transfer to them be with or without the consent of the mortgagee, for annotated on March 3, 1983 a notice of lis pendens.[3] On appeal by petitioner Banaga, the
such mortgage until discharged follows the property. 9 It is clear therefore that the surrender CA reversed the decision of the trial court and allowed the former to redeem the property
by petitioner of the certificates of title to the Register of Deeds as ordered by the trial court within a certain period.[4]Private respondents petition to this Court was dismissed [5] and the
will not create any substantial injustice to her. To grant the petition and compel INK to file a decision became final.
new action in order to obtain the same reliefs it asked in the motion before the trial court is
to encourage litigations where no substantial rights are prejudiced. This end should be On June 11, 1992, petitioner Banaga tried to redeem the property by depositing with
avoided. Courts should not be so strict about procedural lapses that do not really impair the trial court the amount of redemption which was financed by her co-petitioner
the proper administration of justice. The rules are intended to insure the orderly conduct of Tan. Private respondent opposed the redemption arguing that it was made beyond the
litigations because of the higher objective they seek, which is, to protect the parties' time given to her by the court in the earlier case. However, the lower court issued an order
substantive rights. 10 on August 7, 1992 upholding the redemption and ordered the Register of Deeds to cancel
private respondents Certificates of Title and issue new titles in the name of petitioner
Banaga.[6] When his motion for reconsideration was denied by the trial court in an order
WHEREFORE, the appealed decision of the Court of Appeals dated 28 October 1992 is
dated January 4, 1993, private respondent filed a petition for certiorari with the CA which
AFFIRMED.
was docketed as CA-G.R. No. 29869. On January 11, 1993, private respondent caused
the annotation of said petition as another notice of lis pendens on the Certificates of
SO ORDERED. Title. Three days later, the CA issued a temporary restraining order to enjoin the execution
of the August 7, 1992 and January 4, 1993 orders.
Meanwhile, on January 7, 1993, petitioner Banaga sold the subject property to
petitioner Tan with the deed of absolute sale mentioning private respondents certificate of
title which was not yet cancelled. Notwithstanding the notice of lis pendens, petitioner Tan
subdivided the property in question under a subdivision plan, which she made not in her
name but in the name of private respondent. There being no preliminary injunction issued
and with the expiration of the TRO, petitioner Tan asked the Register of Deeds to issue
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
new titles in her name. On March 24, 1993, such titles were issued in petitioner Tans name WHEREFORE, in view of all the foregoing considerations, the petition is GRANTED.
but it still carried the annotations of the two notices of lis pendens. Upon learning of the Judgment is hereby rendered:
new title of petitioner Tan, private respondent impleaded the former in his petition in CA-
G.R. No. 29869.
1) setting aside the orders of the respondent judge dated January11, 1995 and
On October 28, 1993, the CA set aside the August 7, 1992 and January 4, 1993 March 29, 1996;
orders of the trial court and declared private respondent absolute owner of the subject
property. The CA disposed of the petition as follows: 2) declaring the title issued to Biblia Toledo-Banaga, Jovita Tan and to those
other subsequent transferee or transferees, if any, as null and void;
WHERFORE, in view of the foregoing considerations, the instant petition is hereby
GRANTED. The orders issued by public respondent judge dated August 7, 1992 and 3) ordering the Register of Deeds of General Santos City to issue new
January 4, 1993 are hereby ordered SET ASIDE and a new one is hereby entered certificates of title to Candelario Damalerio over the parcels of land in
declaring petitioner as the absolute owner of the parcels of land subject of redemption for question;
failure of private respondent to exercise the right of redemption within the thirty (30) day
period previously granted her by this court.[7]
4) ordering the respondent court to issue writ of execution for the enforcement
of this decision and of the decision in CA-G.R. SP No. 29868 (sic), as
That decision became final and executory after petitioner Banagas petition for review well as a writ of possession for the delivery to petitioner Damalerio of
was dismissed by this Court for lack of merit. [8] Upon motion of private respondent, the trial the Physical possession of the parcels of land subject matter of this
court issued a writ of execution on December 27, 1994 ordering the Register of Deeds to case.
reinstate the Certificates of Title in the name of the movant herein private respondent. In its
order which petitioners did not contest, the court a quo said that:
SO ORDERED.[12]
Although there is no specific pronouncement in the decision of the Court of Appeals that
Upon denial by the CA of their motion for reconsideration, petitioners filed the instant
reverts the titles to the land subjects of redemption to the defendant, the fact that it
petition for certiorari and mandamus. The Court, however, is puzzled why petitioners, in
declared the petitioner (Damalerio) as the absolute owner of the lands entitles him to writ
of execution issuing from this court directing the Register of Deeds to reinstate his titles to their petition, would seek to set aside the two orders (January 4, 1995 and March 29,
1996) of respondent judge who was not named in their petition. [13] Assuming this to be a
his name. As it is implied from the decision declaring him the absolute owner of the lands
that the titles to the land be reverted to him (See Uy v. Capulong, 221 SCRA 87). mere lapsus since they also confusingly refer to Banaga and Tan as private respondent
and to Damalerio as petitioner,[14] the petition is still utterly without merit. It is petitioners
stand (1) that petitioner Tan is a buyer in god faith and (2) that the remedy of private
Let therefore a writ of execution issue in this case to enforce the decision of the Court of respondent to secure the titles in his name is by consulta to the Land Registration
Appeals. In this connection, the Register of Deeds of the Registry of Deeds for General Commissioner and not through contempt.
Santos City is hereby ordered to reinstate the titles of Candelario B. Damalerio - Transfer
Certificates of Title No. T- 19570 and T-19571, both of the Registry of Deeds from General The Court is not convinced of the arguments proffered by petitioners.
Santos City.[9]
By arguing that petitioner Tan was a buyer in good faith, petitioners in effect raise
once more the issue of ownership of the subject property. But such issue had already been
But the Register of Deeds refused to comply with the writ of execution alleging that clearly and categorically ruled upon by the CA and affirmed by this Court, wherein private
the Certificates of Title issued to petitioner Tan must first be surrendered. Accordingly, respondent was adjudged the rightful and absolute owner thereof. The decision in that
private respondent moved to cite the Register of Deeds in contempt of court which was case bars a further repeated consideration of the very same issue that has already been
denied, as the trial court ruled on January 11, 1995 that the formers remedy is settled with finality. To once again re-open that issue through a different avenue would
by consulta to the Commissioner of Land Registration. [10] In another order (dated March defeat the existence of our courts as final arbiters of legal controversies. Having attained
29, 1996), the trial court likewise denied private respondents motion for the issuance of a finality, the decision is beyond review or modification even by this Court. [15]
writ of possession ruling that the latters remedy is a separate action to declare petitioner
Tans Certificates of Title void. Aggrieved, private respondent again elevated the case to Under the principle of res judicata, the Court and the parties, are bound by such final
the CA via a petition for certiorari and mandamus[11] assailing the above-mentioned two decision, otherwise, there will be no end to litigation. It is to the interest of the public that
orders of the court a quonaming as respondents the trial court judge, the Register of there should be an end to litigation by the parties over a subject fully and fairly adjudicated,
Deeds and the petitioners. On November 7, 1996, the CA rendered a decision granting the and an individual should not be vexed twice for the same cause. [16] All the elements of res
petition and, among others, set aside the assailed orders of the trial court. The dispositive judicata are present in this case, which are:
portion of the CA decision reads:
(a) the former judgment must be final;
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
(b) the court which rendered judgment had jurisdiction over the parties and the axiomatic that where a decision on the merits is rendered and the same has become final
subject matter; and executory, as in this case, the action on procedural matters or issues becomes moot
and academic.[24] Thus, the so-called consulta to the Commissioner of Land Registration,
(c) it must be a judgment on the merits; which is not applicable herein, was only a naive and belated effort resorted to by
petitioners in order to delay execution. If petitioners desire to stop the enforcement of a
(d) and there must be between the first and second actions identity of parties,
final and executory decision, they should have secured the issuance of a writ of
subject matter, and cause of action.[17]
preliminary injunction,[25] but which they did not avail knowing that there exists no legal or
The judgment in the redemption suit had long become final and executory; there is even equitable justifications to support it.
no question that the court had jurisdiction over the parties and the subject matter; it
At any rate, at the time petitioner Banaga sold the property to petitioner Tan, the
involves an adjudication on the merits of the case as the court discussed and passed upon
latter was well aware of the interest of private respondent over the lot. Petitioner Tan
petitioner Banagas right of redemption which she did not timely exercise and as a
furnished the amount used by petitioner Banaga for the attempted redemption. One who
consequence, lost her claim of ownership of the lot. Both petitioners and private
redeems in vain a property of another acquires notice that there could be a controversy. It
respondent are parties to the earlier cases, disputing the same parcel of land with both
is for the same reason that petitioner Tan was included as party to the case filed in
opposing parties claiming ownership thereof. Certainly, res judicata had set in. Besides,
court. Worse, at the time of the sale, petitioner Tan was buying a property not registered in
once a judgment had become final and executory, it can no longer be disturbed no matter
the sellers name.This clear from the deed of absolute sale which even mentioned that the
how erroneous it may be. In any case, no such error was attributed to in this case.
Certificates of Title is still in the name of private respondent. It is settled that a party
dealing with a registered land need not go beyond the Certificate of Title to determine the
Contrary to petitioners argument, private respondents remedy is not a direct or true owner thereof so as to guard or protect her interest. She has only to look and rely on
independent civil action for cancellation of petitioner Tans titles. The facts, circumstances, the entries in the Certificate of Title. By looking at the title, however, petitioner Tan cannot
evidence and arguments invoked in this derailed final and executory decision are the very feigned ignorance that the property is registered in private respondents name and not in
same matters that will be established assuming such independent suit is legally the name of the person selling to her. Such fact alone should have at least prompted, if not
warranted. It does not matter whether the former case was a redemption suit and the new impelled her to investigate deeper into the title of her seller - petitioner Banaga, more so
one will be for cancellation of title because the test of identity of causes of action is not in when such effort would not have entailed additional hardship, and would have been quite
its form but whether the same evidence would support and establish the former and easy, as the titles still carried the two notices of lis pendens.
present causes of action.[18]
By virtue of such notices, petitioner Tan is bound by the outcome of the litigation
Petitioners other contention that the execution of the final and executory decision - subject of the lis pendens. As a transferee pendente lite, she stands exactly in the shoes of
which is to issue titles in the name of private respondent - cannot be compelled the transferor and must respect any judgment or decree which may be rendered for or
by mandamus because of the formality that the registered owner first surrenders her against the transferor. Her interest is subject to the incidents or results of the pending suit,
duplicate Certificates of Title for cancellation per Section 80 of Presidential Decree and her Certificates of Title will, in that respect, afford her no special protection. [26]
1529[19] cited by the Register of Deeds,[20] bears no merit. In effect, they argue that the
To repeat, at the time of the sale, the person from whom petitioner Tan bought the
winning party must wait execution until the losing party has complied with the formality of
property is neither the registered owner nor was the former authorized by the latter to sell
surrender of the duplicate title.Such preposterous contention borders on the absurd and
the same. She knew she was not dealing with the registered owner or a representative of
has no place in our legal system. Precisely, the Supreme Court had already affirmed the
the latter. One who buys property with full knowledge of the flaws and defects in the title of
CAs judgment that Certificates of Title be issued in private respondents name. To file
his vendor is enough proof of his bad faith[27] and cannot claim that he acquired title in
another action just to compel the registered owner, herein petitioner Tan, to surrender her
good faith as against the owner or of an interest therein. [28] When she nonetheless
titles constitute violation of, if not disrespect to, the orders of the highest tribunal.
proceeded to buy the lot, petitioner Tan gambled on the result of litigation. [29] She is bound
Otherwise, if execution cannot be had just because the losing party will not surrender her
by the outcome of her indifference with no one to blame except herself if she looses her
titles, the entire proceeding in the courts, not to say the efforts, expenses and time of the
claim as against one who has a superior right or interest over the property. These are the
parties, would be rendered nugatory. It is revolting to conscience to allow petitioners to
undeniable and uncontroverted facts found by the CA, which petitioners even quote and
further avert the satisfaction of their obligation because of sheer literal adherence to
cite in their petition. As aptly concluded by the CA that petitioner Tan is indeed a buyer in
technicality,[21] or formality of surrender of the duplicate titles. The surrender of the
bad faith on which the Court agrees:
duplicate is implied from the executory decision since petitioners themselves were parties
thereto. Besides, as part of the execution process, it is a ministerial function of the Register
of Deeds to comply with the decision of the court to issue a title and register a property in Notwithstanding her constructive and actual knowledge that Damalerio was claiming the
the name of a certain person, especially when the decision had attained finality, as in this land, that the land was in his name, and it was involved in pending litigation, Jovita Tan
case. bought it from Banaga on January 7, 1993. The deed of sale recites that the parcels of
land sold were covered by Transfer Certificates of Title No. __ (formerly [T-12488] T-530)
In addition, the enforcement of a final and executory judgment is likewise a and TCT No. __ (formerly [T-12488] T-530) (sic) and TCT No. __ (formerly P-1294).
ministerial function of the courts[22] and does not call for the exercise of discretion. Being a (Annex F, Petition). Apart from the fact that Banaga was without any TCT, as above
ministerial duty, a writ of mandamus lies to compel its performance.[23] Moreover, it is
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
stated, TCT No. T-12488 was petitioners title (Annex C, Petition). Herein private 4. Private respondents and respondent Judge executed the questioned orders
respondent Tan was buying a land not registered in her sellers (Banagas) name, but in of August 7, 1993 and January 4, 1993, pending review of said orders in CA-
that of petitioner Damalerio who had been claiming it as his own. She admitted this fact G.R. SP No. 29869. The nullification of said orders by this out imposed upon
when she had the land subdivided on February 2, 1993 not in her name but in the name of the private respondents the obligation to return the property to Damalerio and
Candelario Damalerio (Annex Q, Reply). Evidently, she was a purchaser in bad faith upon respondent Judge, upon motion for execution, to order the cancellation of
because she had full knowledge of the flaws and defects of title of her seller, Banaga. X x private respondents titles and the issuance of new titles to him.
x.
5. This Court in its decision in CA-G.R. SP No. 29869 declared petitioner
Damalerio absolute owner of the property in question. Private respondents
The notice of lis pendens registered on March 3, 1993 involving the land in question and were parties litigants in said case, who did not claim possession of the land
private respondent Tans actual knowledge of the then pending Civil Case No. 2556, where separately from their claim of ownership thereof. Such being the case, the
the question as to whether the redemption of the land which she financed was raised, delivery of possession is considered included in this Courts decision declaring
rendered her a purchaser in bad faith and made the decision therein binding upon her.[30] Damalerio absolute owner of the property (x x x), which can be enforced by
writ of possession (x x x). In denying petitioners motion for writ of possession,
Being a buyer in bad faith, petitioner Tan cannot acquire a better rights than her the trial court violated said doctrines, and
predecessor in interest,[31] for she merely stepped into the shoes of the latter. Such finding
of bad faith is final and may not be re-opened for the law cannot allow the parties to trifle 6. Lastly, the effect of respondent Judges order of March 29, 1996 is to re-open
with the courts.[32] the decision in CA-G.R. SP No. 29689 for re-litigation and alteration in a
separate action. For while this Court already declared that Banagas
With respect to the issue of possession, such right is a necessary incident of redemption of the land financed by private respondent Tan was invalid, and as
ownership.[33] The adjudication of ownership to private respondent includes the delivery of a consequence declared Damalerio absolute owner of the property, which was
possession since the defeated parties in this case has not shown by what right to retain binding against private respondent Tan, as she was a respondent therein and
possession of the land independently of their claim of ownership which was a purchaser pendente lite and in bad faith, the order of the respondent Court
rejected.[34] Otherwise, it would be unjust if petitioners who has no valid right over the holding that another civil action be filed to annul private respondent Tans titles
property will retain the same.[35] Thus, the CA correctly disagreed with the trial courts order would be to re-litigate such issues and modify or alter this Courts final decision.
denying private respondents motion for writ of possession for the following reasons cited in
its decision: The respondent Court has no authority to do so. [36]
1. The order violates the doctrine laid down in Javier vs. Court of Appeals, 224 WHEREFORE, premises considered, the petition is hereby DENIED and the assailed
SCRA 704, which ruled that the issuance of title in favor of a purchaser in bad decision of the Court of Appeals is AFFIRMED in toto with costs against petitioners. No
faith does not exempt the latter from complying with the decision adverse to his further proceeding will be entertained in this case.
predecessor in interest, nor preclude him from being reached by writ of
execution; SO ORDERED.
3. Private respondent Tans titles and those of her predecessor, Banaga, arose
from the void orders of August 7, 1992 and January 4, 1993. Since a void order
could not give rise to valid rights, said titles were also necessarily null and void
(x x x).
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
G.R. No. 163118 April 27, 2007 WHEREFORE, premises considered, it is hereby ordered that the legal encumbrance of
forty (40) meters for river bank protection annotated on Petitioners Transfer Certificate of
DORIS CHIONGBIAN-OLIVA, Petitioner, Title No. 5455 be reduced to the applicable legal easement of three (3) meters in
accordance with law.
vs.
REPUBLIC OF THE PHILIPPINES, THE DEPARTMENT OF ENVIRONMENT AND
NATURAL RESOURCES AND THE REGISTER OF DEEDS OF CEBU Accordingly, the Register of Deeds of Cebu City is hereby directed to cancel the above
CITY, Respondents. legal encumbrance of forty (40) meters annotated on Petitioners Transfer Certificate of
Title No. 5455 and in lieu thereof, annotate the applicable legal encumbrance of three (3)
DECISION meters for river bank protection.
This petition for certiorari assails (1) the Decision 1 dated August 7, 2003 of the Court of On appeal, the Court of Appeals reversed the trial courts decision. It upheld the DENRs
Appeals in CA-G.R. CV. No. 74409, reversing the Decision2 dated December 13, 2001 of claim that the property was inalienable. Accordingly, a positive act of the government was
the Regional Trial Court of Cebu City, Branch 12 in SP. Proc. No. 10746-CEB, and (2) the necessary to declassify it from forest land to alienable land. Declaration of the property as
residential in the tax declaration and reclassification of the area where it is located as
Resolution3 dated March 17, 2004, denying the motion for reconsideration.
urban were insufficient bases to reclassify the property. The fallo of the appellate courts
decision reads:
The following facts are undisputed.
WHEREFORE, premises considered, the Decision dated December 13, 2001, of the
Petitioner Doris Chiongbian-Oliva is the registered owner of a parcel of land in Talamban, Regional Trial Court, 7th Judicial Region, Branch 12, Cebu City, in SP. PROC. NO. 10746-
Cebu City, as evidenced by Transfer Certificate of Title (TCT) No. 5455. 4 This title CEB, is hereby REVERSED and SET ASIDE. No pronouncement as to costs.
originated from Original Certificate of Title (OCT) No. 1066 from a free patent granted on
September 11, 1969 under Commonwealth Act No. 141, 5 as amended. The free patent,
SO ORDERED.11
OCT No. 1066, and TCT No. 5455 contained the condition that a forty-meter legal
easement from the bank of any river or stream shall be preserved as permanent
timberland.6 The appellate court later denied petitioners motion for reconsideration.
On October 1, 2001, petitioner filed a petition for reduction of legal easement docketed as Petitioner now raises the following issues:
SP. Proc. No. 10746-CEB before the Regional Trial Court of Cebu City, Branch 12.
Petitioner alleged that the property is residential as shown by the tax declaration 7 and the I.
Certification8 of the Office of the City Assessor. Thus, the applicable legal easement is only
three meters pursuant to Department of Environment and Natural Resources (DENR)
Administrative Order No. 99-21,9 and not forty meters, which applies to timberlands and WHETHER OR NOT PETITIONERS LOT COVERED BY THE LEGAL ENCUMBRANCE
forest lands. Petitioner also alleged that enforcing the forty-meter legal easement would IS A PUBLIC LAND/LAND OF THE PUBLIC DOMAIN (AND THUS, CANNOT BE
virtually deprive her of the use and enjoyment of the property since it consists only of 1,000 RECLASSIFIED EXCEPT BY THE EXECUTIVE DEPARTMENT) OF THE
square meters. GOVERNMENT, OR A PRIVATE LAND.
The DENR countered that the property is inalienable. It also claimed that the applicant II.
agreed on the forty-meter legal easement when the free patent was applied for.
WHETHER OR NOT THE TRIAL COURT IS CORRECT IN TAKING JUDICIAL NOTICE
The trial court ruled in favor of petitioner. It said that there is no longer any reason for the OF THE FACT THAT PETITIONERS LOT COVERED BY TCT NO. 5455 IS SITUATED IN
forty-meter legal easement because the property had been transformed into residential AN URBAN AREA AND NOT IN A FOREST AREA, AND IN THUS CONCLUDING THAT
land and the area where it is located has been reclassified as urban. Applying DENR A.O. THE LEGAL EASEMENT APPLICABLE FOR RIVER BANK PROTECTION IS THREE (3)
No. 99-21, the applicable legal easement is only three meters. The decisions decretal METERS AND NOT FORTY (40) METERS.
portion states:
III.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
WHETHER OR NOT SECTION 90(i) OF C.A. NO. 141 WHICH PROVIDES FOR A forty (40) meters wide starting from the banks on each side of any river or stream that may
UNIFORM EASEMENT OF FORTY (40) METERS FROM THE BANK ON EACH SIDE OF be found on the land shall be demarcated and preserved as permanent timberland.
ANY RIVER, AND WHICH PRESERVES THE SAID 40-METER PORTION AS
PERMANENT TIMBERLAND REGARDLESS OF WHETHER IT IS SITUATED IN A
Likewise, to be demarcated are public lands along the banks of rivers and streams and the
FOREST AREA OR AN URBAN AREA, IS STILL APPLICABLE TO LOTS SITUATED IN shores of the seas and lakes throughout their entire length and within a zone of three (3)
AN URBAN AREA IN THE LIGHT OF THE PROVISIONS OF SUBSEQUENT meters in urban areas, twenty (20) meters in agricultural areas and forty (40) meters in
LEGISLATION, SPECIFICALLY SECTION 51 OF P.D. NO. 1067.12 forest area, along their margins which are subject to the easement for public use in the
interest of recreation, navigation, floatage, fishing and salvage.
Simply stated, the issues are: (1) Is the property public or private land? and (2) Is the
applicable legal easement forty or three meters? xxxx
On the first issue, C.A. No. 141, as amended, provides that lands of the public domain may
2.3 Survey of Titled Lands:
be classified by the President, upon the recommendation of the Secretary of Environment
and Natural Resources, into: (1) alienable or disposable; (2) timber; and (3) mineral
lands.13 However, only alienable or disposable lands may be disposed of through any of 2.3.1 Administratively Titled Lands:
the forms of concession enumerated in the law. 14 A free patent is one of such
concessions15and once it is registered and the corresponding certificate of title issued, the The provisions of item 2.1.a and 2.1.b shall be observed as the above. However, when
land covered by them ceases to be part of the public domain and becomes private these lands are to be subdivided, consolidated or consolidated-subdivided, the strip of
property.16 three (3) meters which falls within urban areas shall be demarcated and marked on the
plan for easement and bank protection.
Verily, by the issuance of a free patent on September 11, 1969, and the subsequent
issuance of OCT No. 1066 and TCT No. 5455, the property in this case had become The purpose of these strips of land shall be noted in the technical description and
private land. It is inconsistent for an alienable land of the public domain to be covered by a annotated in the title.
free patent and at the same time retain its character as public land.
xxxx
On the second issue, Section 90(i) of C.A. No. 141 requires that a forty-meter legal
easement from the bank of any river or stream shall be preserved as permanent
timberland. More specifically, it provides: Running in parallel vein is the Water Code of the Philippines 17 which provides:
(i) That the applicant agrees that a strip forty meters wide starting from the bank on each Art. 51. The banks of rivers and streams and the shores of the seas and lakes throughout
side of any river or stream that may be found on the land applied for, shall be demarcated their entire length and within a zone of three (3) meters in urban areas, twenty (20) meters
and preserved as permanent timberland to be planted exclusively to trees of known in agricultural areas and forty (40) meters in forest areas, along their margins, are subject
economic value, and that he shall not make any clearing thereon or utilize the same for to the easement of public use in the interest of recreation, navigation, floatage, fishing and
ordinary farming purposes even after patent shall have been issued to him or a contract of salvage. No person shall be allowed to stay in this zone longer than what is necessary for
lease shall have been executed in his favor. (Emphasis supplied.) recreation, navigation, floatage, fishing or salvage or to build structures of any kind.
To implement this, the DENR promulgated A.O. No. 99-21 which provides the guidelines in Since the property in this case was originally alienable land of the public domain, the
the processing, verification, and approval of isolated and cadastral surveys. Pertinent to application for free patent contained the condition that a forty-meter legal easement from
this case are the following provisions: the banks on each side of any river or stream found on the land shall be demarcated and
preserved as permanent timberland. However, after the property was administratively
titled, it underwent several surveys for purposes of subdivision, consolidation, or
2.1 Original Surveys: consolidation-subdivision as evidenced by TCT No. 5455. This title provides that it is a
transfer from TCT Nos. 3975 and 436018and describes the property as Lot 2 of the
2.1.a Public Lands: consolidation-subdivision plan Pcs-07-002121, being a portion of Lot 6 and 7 Pcs-07-
000974.19 Thus, presently only three meters is required to be demarcated and preserved
as permanent timberland.
All alienable and disposable (A and D) lands of the public domain shall be surveyed
pursuant to Section 1 Par. (1) of R.A. 1273 [C.A. No. 141, Section 90(i)] whereby a strip of
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
In this case, the trial court properly took judicial notice that Talamban, Cebu City is an G.R. No. 215009, January 23, 2017
urban area. Judicial notice is the cognizance of certain facts which judges may properly
take and act on without proof because they already know them.20 A municipal jurisdiction, REPUBLIC OF THE PHILIPPINES, Petitioner, v. CARMEN SANTORIO
whether designated as chartered city or provincial capital, is considered as urban in its
GALENO, Respondent.
entirety if it has a population density of at least 1,000 persons per square kilometer. 21 The
City of Cebu was created on October 20, 1934 under Commonwealth Act No. 58. 22 It is a
highly urbanized city classified as entirely urban. 23 Thus, all its barangays, including DECISION
Talamban, are considered urban.
PERLAS-BERNABE, J.:
Conformably with the foregoing considerations, the reduction of the legal easement of forty
meters on petitioners property covered by TCT No. 5455 to three meters now is in order. Assailed in this petition for review on certiorari1 are the Decision2 dated June 27, 2013 and
the Resolution3 dated September 17, 2014 rendered by the Court of Appeals (CA) in CA-
WHEREFORE, the instant petition is GRANTED. The assailed Decision dated August 7, G.R. CV No. 02085, affirming the Orders dated October 13, 2006 4 and January 22,
2003 and Resolution dated March 17, 2004 of the Court of Appeals in CA-G.R. CV. No. 20075 of the Regional Trial Court of Dumangas, Iloilo, Branch 68 (RTC), which allowed the
74409 are REVERSED, and the Decision dated December 13, 2001 of the Regional Trial correction of the area of Lot No. 2285 in Original Certificate of Title (OCT) No. 46417 from
Court of Cebu City, Branch 12 in SP. Proc. No. 10746-CEB is REINSTATED. 20,948 square meters to 21,298 square meters.
Respondent further alleged that when she and her co-owners had the subject property
resurveyed for the purpose of partition, they discovered a discrepancy in the land area of
the subject property as appearing in OCT No. 46417, 9 in that the title reflects an area
of 20,948 square meters, while the Certification10 issued by the DENR Office of the
Regional Technical Director, Lands Management Services, shows an area
of 21,298 square meters. Hence, she sought to correct the area of the subject property in
order to avoid further confusion, and claimed to have notified the adjoining owners. 11
There being no opposition to the petition, the RTC allowed the presentation of
respondent's evidence ex parte before the Branch Clerk as well as for the satisfaction of
the jurisdictional requirements.12
In an Order13 dated October 13, 2006, the RTC granted the petition upon a finding that
respondent was able to substantiate the allegations in her petition to warrant a correction
of the area of the subject property. Hence, it directed the Register of Deeds of the Province
of Iloilo to correct such area in OCT No. 46417 from 20,948 to 21,298 square meters. 14
Herein petitioner Republic of the Philippines (petitioner), through the Office of the Solicitor
General (OSG), filed a motion for reconsideration claiming that the adjoining owners had
not been notified, stressing that such notice is a jurisdictional requirement. 15 In the
Order16 dated January 22, 2007, the RTC denied the motion, finding that a Notice of
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Hearing17 was sent to the adjoining owners. As such, respondent was able to prove Unfortunately, the foregoing documentary evidence are not sufficient to warrant the
compliance with the said jurisdictional requirement. 18 correction prayed for. The Court cannot accord probative weight upon them in view of the
fact that the public officers who issued the same did not testify in court to prove the facts
Aggrieved, petitioner appealed to the CA.19 stated therein.
The CA Ruling In Republic v. Medida,27 the Court held that certifications of the Regional Technical
Director, DENR cannot be considered prima facie evidence of the facts stated therein,
In a Decision20 dated June 27, 2013, the CA affirmed the RTC Order. It found that holding that:ChanRoblesVirtualawlibrary
respondent, by a preponderance of evidence, was able to prove, based on the records of Public documents are defined under Section 19, Rule 132 of the Revised Rules on
the proper government authority, i.e., the Office of the Technical Director, Land Evidence as follows:chanRoblesvirtualLawlibrary
Management Services of the DENR, that the true and correct area of the subject property
was 21,298 square meters as shown in the approved plan. Moreover, petitioner failed to (a) The written official acts, or records of the official acts of the sovereign authority, official
rebut with contrary evidence respondent's claim that she and her co-owners followed the bodies and tribunals, and public officers, whether of the Philippines, or of a foreign
boundaries in the technical description of OCT No. 46417 when they caused its resurvey. country;chanrobleslaw
In fact, no proof had been adduced to show that the boundaries had been altered. Also,
the CA pointed out that none of the adjoining owners, who were properly notified of the (b) Documents acknowledged before a notary public except last wills and testaments; and
proceedings and who stand to be adversely affected by the change in the land area of the
subject property, objected to respondent's petition. 21 (c) Public records, kept in the Philippines, of private documents required by law to be
entered therein.
Petitioner's motion for reconsideration22 was denied in a Resolution23 dated September 17,
2014; hence, this petition. Applying Section 24 of Rule 132, the record of public documents referred to in Section
19(a), when admissible for any purpose, may be evidenced by an official publication
thereof or by a copy attested by the officer having legal custody of the record, or by his
The Issue Before the Court
deputy x x x.
The issue advanced for the Court's resolution is whether or not the CA erred in upholding
Section 23, Rule 132 of the Revised Rules on Evidence
the correction of the area of the subject property in OCT No. 46417.
provides:ChanRoblesVirtualawlibrary
"Sec. 23. Public documents as evidence. - Documents consisting of entries in public
The Court's Ruling records made in the performance of a duty by a public officer are prima facie evidence of
the facts stated therein. All other public documents are evidence, even against a third
The petition is meritorious. person, of the fact which gave rise to their execution and of the date of the latter."
The CENRO and Regional Technical Director, FMS-DENR, certifications [do] not fall
A scrutiny of the evidence marked and formally offered by respondent before the court a within the class of public documents contemplated in the first sentence of Section
quo shows that the former failed to prove that there was sufficient basis to allow the 23 of Rule 132. The certifications do not reflect "entries in public records made in the
correction of the area of the subject property in OCT No. 46417 from 20,948 square performance of a duty by a public officer," such as entries made by the Civil Registrar in
meters to 21,248 square meters. the books of registries, or by a ship captain in the ship's logbook. The certifications are
not the certified copies or authenticated reproductions of original official records in
Records reveal that respondent offered in evidence the following documents: (a) the the legal custody of a government office. The certifications are not even records of
Certification24issued by a certain Althea C. Acevedo (Acevedo), Engineer IV, Chief of the public documents. x x x28 (Emphases supplied)
Technical Services Section of the Office of the Regional Technical Director, Land As such, sans the testimonies of Acevedo, Caballero, and the other public officers who
Management Services of the DENR in Iloilo City, which states that "the true and correct issued respondent's documentary evidence to confirm the veracity of its contents, the
area of [L]ot 2285, Cad. 246 Dingle Cadastre is 21,928 square meters;" (b) the technical same are bereft of probative value and cannot, by their mere issuance, prove the facts
description25 of Lot No. 2285, a copy of which was certified by Ameto Caballero stated therein.29 At best, they may be considered only as prima facie evidence of their due
(Caballero), Chief of the Surveys Division, while another copy was certified correct by execution and date of issuance but do not constitute prima facie evidence of the facts
Acevedo; and (c) the approved subdivision plan of Lot No. 2258, 26 certified by Rogelio M. stated therein.30
Santome (Santome), Geodetic Engineer; Alfredo Muyarsas (Muyarsas), Chief of the
Regional Surveys Division, and Edgardo R. Gerobin (Gerobin), OIC, Regional Technical In fact, the contents of the certifications are hearsay because respondent's sole witness
Director of the Land Management Services, DENR. On the strength of these pieces of and attorney-in-fact, Lea Galeno Barraca, was incompetent to testify on the veracity of
evidence, respondent sought a reconciliation of the area of the subject property with the their contents,31 as she did not prepare any of the certifications nor was she a public officer
records of the DENR. of the concerned government agencies. Notably, while it is true that the public prosecutor
who represented petitioner interposed no objection to the admission of the foregoing
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
evidence in the proceedings in the court below, 32 it should be borne in mind that "hearsay LUCIANO P. PAZ, G.R. No. 157367
evidence, whether objected to or not, has no probative value unless the proponent can Petitioner,
show that the evidence falls within the exceptions to the hearsay evidence rule," 33which do
not, however, obtain in this case. Verily, while respondent's documentary evidence may Present:
have been admitted due to the opposing party's lack of objection, it does not, however, -versus-
mean that they should be accorded any probative weight. The Court has explained CORONA, C.J., Chairperson,
that:ChanRoblesVirtualawlibrary LEONARDO-DE CASTRO,
The general rule is that hearsay evidence is not admissible. However, the lack of objection REPUBLIC OF THE PHILIPPINES, ACTING BERSAMIN,
to hearsay testimony may result in its being admitted as evidence. But one should not be THROUGH THE DEPARTMENT OF ENVIRONMENT DEL CASTILLO, and
misled into thinking that such declarations are thereby impressed with probative value. AND NATURAL RESOURCES, PUBLIC ESTATES VILLARAMA, JR., JJ.
Admissibility of evidence should not be equated with weight of evidence. Hearsay AUTHORITY, FILINVEST DEVELOPMENT
evidence whether objected to or not cannot be given credence for it has no probative CORPORATION, and FILINVEST ALABANG, INC.,
value.34chanroblesvirtuallawlibrary Respondents. Promulgated:
Besides, case law states that the "absence of opposition from government agencies is of
no controlling significance because the State cannot be estopped by the omission, mistake
or error of its officials or agents. Neither is the Republic barred from assailing the decision November 23, 2011
granting the petition for reconstitution [or correction of title, as in this case] if, on the basis
of the law and the evidence on record, such petition has no merit." 35 Moreover, "in civil
cases, the party having the burden of proof must produce a preponderance of evidence x-----------------------------------------------------------------------------------------x
thereon, with plaintiff having to rely on the strength of his own evidence and not upon the
DECISION
weakness of the defendant's."36
In fine, the Court holds that respondent did not present any competent evidence to prove
that the true and correct area of the subject property is 21,298 square meters instead of BERSAMIN, J.:
20,948 square meters to warrant a correction thereof in OCT No. 46417. Accordingly,
respondent's petition for the correction of the said Certificate of Title must be denied, and
the present petition be granted.
The petitioner assails the decision promulgated on August 1, 2002, [1] whereby the Court of
WHEREFORE, the petition is GRANTED. The assailed Decision dated June 27, 2013 and
Appeals (CA) affirmed the dismissal by the Regional Trial Court (RTC), Branch 276, in
the Resolution dated September 17, 2014 rendered by the Court of Appeals in CA-G.R.
CV No. 02085 are hereby REVERSED and SET ASIDE. Carmen Santorio Galeno's Muntinlupa City of his petition for the cancellation of a certificate of title brought under
petition for correction of area of Lot No. 2285 on Original Certificate of Title No. 46417
is DISMISSED. Section 108 of Presidential Decree (P.D.) No. 1529 (Property Registration Decree).
SO ORDERED.
Antecedents
On November 29, 2000, the petitioner brought a petition for the cancellation of Original
Certificate of Title (OCT) No. 684 docketed as LRC Case No. 00-059. The petition,
ostensibly made under Section 108 of P.D. No. 1529, impleaded the Republic of the
City and San Pedro, Laguna, and Parcel 2 Plan 11-69, with a total area of 71,409,413
On January 19, 2001, FDC and FAI moved to dismiss the petition for cancellation on the
square meters, situated in Alabang, Muntinlupa, Paraaque City and Las Pias City; that the
following grounds,[4] to wit:
total landholding of the petitioner consisted of 143,102,167 square meters, or
approximately 14,310 hectares; that OCT No. 684 was registered in the name of the (1) The serious and controversial dispute spawned by the Petition for
cancellation of title is litigable in an ordinary action outside the
Republic, and included Lot 392 of the Muntinlupa Estate with an area of approximately 244 special and limited jurisdiction of land registration courts. The
Petition is thus removed from the ambit of Sec. 108 of the Property
hectares; that Lot 392 was segregated from OCT No. 684, resulting in the issuance of Registration Decree which requires, as an indispensable element
for availment of the relief thereunder, either unanimity of the
Transfer Certificate of Title (TCT) No. 185552,[2] also in the name of the Republic; that parties or absence of serious controversy or adverse claim. It
authorizes only amendment and alteration of certificates of title,
FDC and FAI developed Lot 392 into a subdivision based on their joint venture agreement not cancellation thereof;
with the Government; that pursuant to the joint venture agreement, Lot 392 was further (2) Lack of jurisdiction of the Court over the persons of the
respondents who were not validly served with summons but only a
subdivided, causing the cancellation of TCT No. 185552, and the issuance of TCTs for the
copy of the Petition;
resulting individual subdivision lots in the names of the Republic and FAI; and that the
(3) Docket fees for the Petition have not been paid.
subdivision lots were then sold to third parties.
(4) The Petition does not contain the requisite certificate of non-forum
shopping.
for a review of the decree of registration issued to the government of or viewpoint does not make the former guilty of committing grave abuse
the Philippine Islands.; (B) there is an imputation of a wrongful or of discretion.
fraudulent titling in the issuance of Original Certificate of Title No. 684
allegedly irregular due to the absence of survey plan, decree of Not only that. As long as a court acts within its jurisdiction, any alleged
registration and court records; (C) the Petition finally seeks as its main errors committed in the exercise thereof will amount to nothing more
relief the issuance of a new title to him, Luciano Paz, after Original than errors of judgment which are reversible by timely appeal and not
Certificate of Title No. 684 is invalidated, or the reconveyance of the by a special civil action of certiorari (Tomas Claudio Memorial College,
property to him. This action although entitled a Petition for cancellation Inc. vs. CA, 316 SCRA 502). A Petition for Certiorari must be based on
of a title, which is a complaint by itself, is complete with the name of the jurisdictional grounds because, as long as the respondent acted with
parties, the subject matter, the cause of action, and the reliefs prayed jurisdiction, any error committed by him or it in the exercise thereof will
for, which are all components of a regular complaint. It is in fact an amount to nothing more than an error of judgment which may be
initiatory pleading, and is not a mere motion. reviewed or corrected only by appeal (Jalandoni vs. Drilon, 327 SCRA
107).
It is futile to deny that the petition is a fresh lawsuit, involving title to a
land or an interest thereon arising after the original proceeding, which Applying the aforecited jurisprudence to the case at bench, the Petition
should be filed and entitled under the original land registration case must fail. It is all too obvious that Petitioner would have Us determine
under the instructions of Sec. 2 of PD 1529.Indeed, this Section states whether or not Public Respondent correctly rendered judgment in
further post registration cause of an aggrieved party who complains of ordering the dismissal of his Petition. Sadly, as the aforecited rulings
being deprived of a land wrongfully or fraudulently titled in the name of have shown, a special civil action for certiorari is a remedy designed for
another. As such it is fair and logical to assume that this is covered by correction of errors of jurisdiction and not errors of judgment (Diaz vs.
the current rules on an initiatory pleading and becomes vulnerable to Diaz, 331 SCRA 302). Certiorari will not be issued to xxx correct
dismissal under any grounds invoked by the respondent which are erroneous conclusion of law or fact (Tensorex Industrial Corp. vs. CA,
mandatory and jurisdictional requirements under the present rules, 316 SCRA 471).
including the payment of docket fees and the certification of non forum
shopping. To reiterate, Petitioner has failed to overcome the burden of proving
xxxx how Public Respondent may be faulted with having acted with grave
abuse of discretion in rendering judgment ordering the dismissal of his
Petition. That the court a quo cannot share Petitioners interpretation of
certain alleged laws and jurisprudence hardly constitute the abuse of
Thence, the petitioner assailed the dismissal in the CA via petition for certiorari, ascribing discretion contemplated under Rule 65 of the 1997 Rules of Civil
Procedure and as applied by the Highest Tribunal in numerous
grave abuse of discretion on the part of the RTC in granting FDC and FAIs motion to cases. Ours is not, through this Petition, to determine whether or not
Public Respondent erred in its judgment but to determine whether or
dismiss. not Public Respondent court acted with grave abuse of discretion
amounting to lack or excess of jurisdiction.
On August 1, 2002, the CA dismissed the petition for certiorari,[6] stating: WHEREFORE, foregoing premises considered, the Petition is hereby
DENIED DUE COURSE and ordered DISMISSED. Resultantly, the
assailed Resolution/s are hereby AFFIRMED, with costs to Petitioner.
SO ORDERED.
xxxx
Petition denied. On February 24, 2003, the CA denied the petitioners motion for partial reconsideration. [7]
In a special civil action for certiorari, the burden is on Petitioner to prove
not merely reversible error, but grave abuse of discretion amounting to
lack or excess of jurisdiction for the part of Public Respondent. Mere Hence, the petitioner has come to the Court for review, asserting the applicability of
abuse of discretion is not enough (Don Orestes Romualdez Electric
Corporation, Inc. vs. NLRC, 319 SCRA 255). The mere fact that Public Section 108 of P.D. 1529, and insisting that his petition filed under Section 108 of P.D.
Respondent does not subscribe to nor accepts Petitioners arguments
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
certificate for value and in good faith, or his heirs and assigns without
1529 should not be dismissed because it was exempt from the requirements of paying his or their written consent. Where the owners duplicate certificate is
not presented, a similar petition may be filed as provided in the
docket fees, of service of summons, and of the certification against forum shopping due to preceding section.
its not being an initiatory pleading. All petitions or motions filed under this section as well as any other
provision of this decree after original registration shall be filed and
entitled in the original case in which the decree of registration was
entered.
Ruling
Based on the provision, the proceeding for the amendment and alteration of a certificate of
The petition for review is devoid of merit. The dismissal of the petition for certiorari by the
title under Section 108 of P.D. No. 1529 is applicable in seven instances or situations,
CA was proper and correct because the RTC did not abuse its discretion, least of all
namely: (a) when registered interests of any description, whether vested, contingent,
gravely.
expectant, or inchoate, have terminated and ceased; (b) when new interests have arisen
or been created which do not appear upon the certificate; (c) when any error, omission or
Section 108 of P.D. No. 1529 reads as follows:
mistake was made in entering a certificate or any memorandum thereon or on any
Section 108. Amendment and alteration of certificates. No erasure, duplicate certificate; (d) when the name of any person on the certificate has been changed;
alteration, or amendment shall be made upon the registration book after
the entry of a certificate of title or of a memorandum thereon and the (e) when the registered owner has been married, or, registered as married, the marriage
attestation of the same by the Register of Deeds, except by order of the
proper Court of First Instance. A registered owner or other person has been terminated and no right or interest of heirs or creditors will thereby be affected;
having interest in the registered property, or, in proper cases, the
Register of Deeds with the approval of the Commissioner of Land (f) when a corporation, which owned registered land and has been dissolved, has not
Registration, may apply by petition to the court upon the ground that the
registered interest of any description, whether vested, contingent, conveyed the same within three years after its dissolution; and (g) when there is
expectant or inchoate appearing on the certificate, have terminated and
ceased; or that new interest not appearing upon the certificate have reasonable ground for the amendment or alteration of title.[8]
arisen or been created; or that an omission or an error was made in
entering a certificate or any memorandum thereon, or on any duplicate
certificate: or that the same or any person in the certificate has been
changed or that the registered owner has married, or, if registered as We agree with both the CA and the RTC that the petitioner was in reality seeking
married, that the marriage has been terminated and no right or interest
of heirs or creditors will thereby be affected; or that a corporation which the reconveyance of the property covered by OCT No. 684, not the cancellation of a
owned registered land and has been dissolved has not yet convened
the same within three years after its dissolution; or upon any other certificate of title as contemplated by Section 108 of P.D. No. 1529. Thus, his petition did
reasonable ground; and the court may hear and determine the petition
after notice to all parties in interest, and may order the entry or not fall under any of the situations covered by Section 108, and was for that reason rightly
cancellation of a new certificate, the entry or cancellation of a
memorandum upon a certificate, or grant any other relief upon such dismissed.
terms and conditions, requiring security and bond if necessary, as it
Moreover, the filing of the petition would have the effect of reopening the decree
may consider proper; Provided, however, That this section shall not be
construed to give the court authority to reopen the judgment or decree
of registration, and could thereby impair the rights of innocent purchasers in good faith and
of registration, and that nothing shall be done or ordered by the court
which shall impair the title or other interest of a purchaser holding a
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Before the Court is a petition for review on certiorari seeking to reverse and set aside the
xxx Provided, however, That this section shall not be construed to give Amended Decision1 and Resolution2 of the Court of Appeals (CA), dated August 29, 2011
the court authority to reopen the judgment or decree of registration, and and January 10, 2012, respectively, in CA-G.R. SP No. 101406.
that nothing shall be done or ordered by the court which shall impair the
title or other interest of a purchaser holding a certificate for value in Subject of the present controversy are two (2) parcels of land located in Alabang Hills,
good faith, or his heirs and assigns without his or their written consent. Muntinlupa, with land areas measuring 739 and 421 square meters, and are covered by
Where the owners duplicate certificate is not presented, a similar Transfer Certificates of Title Nos. 154626 and 154627, respectively. Appearing on the face
petition may be filed as provided in the preceding section. of these titles as the registered owner is herein respondent, "Maria Josephine S. Cabaez,
of legal age, married to [herein petitioner] Benjamin H. Cabaez x x x."
On February 12, 2007, respondent filed with the Regional Trial Court (RTC) of Muntinlupa
Nor is it subject to dispute that the petition was not a mere continuation of a City a "Petition for Correction of the Name and Marital Status of the Registered Owner of
Transfer Certificates of Title (TCT) No[s.] 154626 and 154627 of the Registry of Deeds for
previous registration proceeding. Shorn of the thin disguise the petitioner gave to it, the Muntinlupa City."3The petition was docketed as LRC Case No. 07-007 and raffled to
Branch 203. In the said petition, respondent alleged as follows:
petition was exposed as a distinct and independent action to seek the reconveyance of chanRoblesvirtualLawlibrary
realty and to recover damages. Accordingly, he should perform jurisdictional acts, like
x x x x
paying the correct amount of docket fees for the filing of an initiatory pleading, causing the
1. Petitioner is of legal age, single and a resident of #21 Dona Ines St., Alabang Hills
service of summons on the adverse parties in order to vest personal jurisdiction over them Village, Muntinlupa City;
in the trial court, and attaching a certification against forum shopping (as required for all 2. Petitioner is the owner of two parcels of land situated in Alabang, Muntinlupa City
covered by Transfer Certificates of Title No. 154626 and 154627 issued by the Registry of
initiatory pleadings). He ought to know that his taking such required acts for granted was Deed for Muntinlupa, though the same were issued under the name Ma Josephine S.
Cabaez, married to Benjamin H. Cabaez. x x x
immediately fatal to his petition, warranting the granting of the respondents motion to
3. Without knowing the legal implication, Petitioner erroneously made it appear that she is
dismiss. married to Mr. Benjamin when in truth and in fact they are not married but merely living a
common-law relationship
WHEREFORE, the PETITION FOR REVIEW ON CERTIORARI is DENIED, and the
4. Mr. Benjamin H. Cabaez is actually married to a certain Leandra D. Cabaez who had
decision of the Court of Appeals is AFFIRMED. previously filed a case against Petitioner, questioning the ownership of the said properties
which case however was terminated by virtue of a compromise approved by the court in an
Order dated November 23, 2000. xxx
The petitioner shall pay the costs of suit. 5. Mr. Benjamin H. Cabaez has also declared that he is not actually married to the
Petitioner and that he has no interest or share whatsoever in the aforesaid properties as
SO ORDERED. evidenced by the hereto attached copy of the Affidavit of Declaration Against Interest
dated January 22, 2007. x x x
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
6. No interests or rights will be affected by the correction of the name and status of Respondent then filed a Motion for Reconsideration8 contending, among others, that the
Petitioner as registered owner of the said properties. provisions of PD 1529, and not Rule 108 of the Rules of Court, should be applied in the
present case; posting of the notice of hearing of respondent's petition is deemed
PRAYER constructive notice to the whole world, including petitioner; the petition filed by respondent
is an action in rem where jurisdiction over the person of the defendant is not a prerequisite
WHEREFORE, it is respectfully prayed of this Honorable Court that Petitioner's name and to confer jurisdiction on the court, provided that the court acquires jurisdiction over the res.
marital status appearing in Transfer Certificates of Title No. 154626 and 154627 be
corrected to (sic) from "MA. JOSEPHINE S. CABAEZ, married to BENJAMIN H. After petitioner filed its Comment,9 the CA rendered its presently assailed Amended
CABAEZ" to ["]MARIE JOSEPHINE C. SOLANO, single" as it is the true and actual Decision and disposed, thus:
status of petitioner. chanRoblesvirtualLawlibrary
WHEREFORE, the Motion for Reconsideration is hereby GRANTED. The Decision dated
x x x x4ChanRoblesVirtualawlibrary 28 June 2007 of the Regional Trial Court or Muntinlupa City, Branch 203, in LRC Case No.
07-007, is REINSTATED. Perforce, the Petition for Annulment of Judgment is DENIED.
The RTC then conducted hearings where respondent presented her evidence ex parte.
SO ORDERED.10ChanRoblesVirtualawlibrary
On June 28, 2007, the RTC of Muntinlupa, Branch 203, rendered its Decision, the This time, the CA agreed with respondent and ruled that PD 1529 is the governing law and
dispositive portion of which reads as follows: that there is nothing under the pertinent provisions of the said law which states that
chanRoblesvirtualLawlibrary publication is a requirement for the RTC to acquire jurisdiction over respondent's petition.
WHEREFORE, finding the petition to be well-founded and meritorious, the same is The CA also ruled that petitioner failed to prove the existence of extrinsic fraud as a
hereby GRANTED. ground for annulment of the assailed judgment of the RTC.
Accordingly, the Register of Deeds of Muntinlupa City is directed to cause the correction of Aggrieved, petitioner filed a Motion for Reconsideration.11
the name and civil status of the registered owner of Transfer Certificate of Title Nos.
154626 and 154627 from MA. JOSEPHINE S. CABAEZ, married to BENJAMIN H. However, in its Resolution of January 10, 2012, the CA denied petitioner's Motion for
CABAEZ, to MARIE JOSEPHINE C. SOLANO, single. Reconsideration.
SO ORDERED.5ChanRoblesVirtualawlibrary Hence, the present petition for review on certiorari based on the following grounds:
The RTC held that from the evidence presented by herein respondent, it has been chanRoblesvirtualLawlibrary
satisfactorily established that the subject properties should indeed be in respondent's A.
name and that her status should be "single".
WHETHER OR NOT THE HONORABLE COURT OF APPEALS PATENTLY ERRED IN
On November 23, 2007, herein petitioner filed with the CA a Petition for Annulment of AMENDING ITS ORIGINAL DECISION DATED JANUARY 27, 2011 CONSIDERING
Judgment6assailing the above Decision of the RTC on the ground that the said trial court THAT THE REQUIREMENTS OF PUBLICATION AND SUMMONS WERE NOT
did not acquire jurisdiction over the subject matter of the case because respondent's COMPLIED WITH.
petition was not published in a newspaper of general circulation and that petitioner and
other persons who may have interest in the subject properties were not served summons.
B.
On January 27, 2011, the CA rendered a Decision, disposing as follows:
WHETHER OR NOT THE PROCEEDING PROVIDED FOR UNDER SECTION 108 OF
chanRoblesvirtualLawlibrary
PRESIDENTIAL DECREE NO. 1529 IS SUMMARY IN NATURE ALBEIT THE EVIDENT
WHEREFORE, the instant Petition for Annulment of Judgment is hereby GRANTED.
PRESENCE. OF OTHER INTERESTED PARTIES THAT MAY BE AFFECTED BY THE
The Decision dated 28 June 2007 of the Regional Trial Court of Muntinlupa City, Branch
JUDGMENT AS A RESULT OF EX-PARTE PROCEEDINGS.
203, in LRC Case No. 07-007, is ANNULLED and SET ASIDE.
SO ORDERED.7ChanRoblesVirtualawlibrary C.
The CA ruled, among others, that respondent's petition for correction of her name and
marital status as appearing in the subject TCTs should have been published in accordance WHETHER OR NOT THE RULING OF THE HONORABLE SUPREME COURT IN THE
with Rule 108 of the Rules of Court and that respondent failed to present sufficient CASE OF CHAN V. COURT OF APPEALS (298 SCRA 713, 733) APPLIES IN THE
evidence to prove compliance with such requirement. The appellate court also held that INSTANT CASE WHERE IT WAS RULED THAT MERE NOTICE TO THE REGISTER OF
respondent also failed to serve summons upon petitioner, which is in violation of the latter's DEEDS WAS A SUBSTANTIAL COMPLIANCE.
right to due process and of the principle of fair play.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
D.
WHETHER OR NOT THE HONORABLE COURT OF APPEALS [IS] PROCEDURALLY
WHETHER OR NOT AMENDMENT AND ALTERATION OF CERTIFICATES OF TITLE CORRECT IN ADMITTING THE SUPPLEMENTAL MEMORANDUM OF THE
PROVIDED FOR UNDER SECTION 108 OF PD 1529 IS AN IN REM PROCEEDINGS RESPONDENT DESPITE THE FACT THAT THE PETITION WAS ALREADY LONG
THAT REQUIRES STRICT COMPLIANCE WITH THE PUBLICATION REQUIREMENT. SUBMITTED FOR DECISION.12ChanRoblesVirtualawlibrary
The Court finds merit in the petition, but for reasons which are not identical as those
E. espoused by petitioner.
WHETHER OR NOT SECTIONS 3 AND 4 OF RULE 108 OF THE RULES OF COURT At the outset, it bears to reiterate that the CA ruled on the basis of the provisions of
SUPPLETORILY APPLY TO THE PROCEEDINGS PROVIDED FOR UNDER SECTION Presidential Decree No. 1529 (PD 1529), otherwise known as the Property Registration
108 OF PD 1529 WHEREIN THE REQUIREMENT OF PUBLICATION IS MANDATORY. Decree. Specifically, the CA cited Sections 2 and 108 of the said law, which provide as
follows:
chanRoblesvirtualLawlibrary
F.
Section 2. Nature of registration proceedings; jurisdiction of courts. Judicial proceedings
for the registration of lands throughout the Philippines shall be in rem and shall be based
WHETHER OR NOT THE PHRASE "THE COURT MAY HEAR AND DETERMINE THE
on the generally accepted principles underlying the Torrens system.
PETITION AFTER NOTICE TO ALL PARTIES IN INTEREST" IN SECTION 108 OF PD
1529 INCLUDES PUBLICATION AND SERVICE OF SUMMONS.
Courts of First Instance shall have exclusive jurisdiction over all applications for original
registration of title to lands, including improvements and interests therein, and over all
G. petitions filed after original registration of title, with power to hear and determine all
questions arising upon such applications or petitions. The court through its clerk of court
WHETHER OR NOT THE COURT A QUO ACQUIRED JURISDICTION OVER THE shall furnish the Land Registration Commission with two certified copies of all pleadings,
SUBJECT MATTER OF THE PETITION IN THE ABSENCE OF SUMMONS AND exhibits, orders, and decisions filed or issued in applications or petitions for land
PUBLICATION. registration, with the exception of stenographic notes, within five days from the filing or
issuance thereof. (emphasis supplied)
H.
Section 108. Amendment, and alteration of certificates. No erasure, alteration, or
WHETHER OR NOT PETITIONER IS AN INDISPENSABLE PARTY IN THE PETITION amendment shall be made upon the registration book after the entry of a certificate of title
FOR CORRECTION OF NAME AND MARITAL STATUS IN THE TRANSFER or of a memorandum thereon and the attestation of the same be Register of Deeds, except
CERTIFICATE OF TITLE NO. 154627 AND 154628. by order of the proper Court of First Instance. A registered owner of other person having
an interest in registered property, or, in proper cases, the Register of Deeds with the
I. approval of the Commissioner of Land Registration, may apply by petition to the court
upon the ground that the registered interests of any description, whether vested,
WHETHER OR NOT LEANDRA D. CABAEZ IS ENTITLED TO NOTICE AND SERVICE contingent, expectant or inchoate appearing on the certificate, have terminated and
OF SUMMONS BY VIRTUE OF THE DECISION OF THE REGIONAL TRIAL COURT OF ceased; or that new interest not appearing upon the certificate have arisen or been
MAKATIY CITY-BRANCH 137 TO THE EFFECT THAT THE PARCELS OF LAND created; or that an omission or error was made in entering a certificate or any
LEGALLY BELONGED TO THEIR CONJUGAL PROPERTY. memorandum thereon, or, on any duplicate certificate; or that the same or any person on
the certificate has been changed; or that the registered owner has married, or, if registered
J. as married, that the marriage has been terminated and no right or interests of heirs or
creditors will thereby be affected; or that a corporation which owned registered land and
WHETHER OR NOT AN AFFIDAVIT THE CONTENTS OF WHICH WAS NOT TESTIFIED has been dissolved has not convened the same within three years after its dissolution; or
TO HAS PROBATIVE VALUE. upon any other reasonable ground; and the court may hear and determine the petition
after notice to all parties in interest, and may order the entry or cancellation of a new
certificate, the entry or cancellation of a memorandum upon a certificate, or grant any other
K. relief upon such terms and conditions, requiring security or bond if necessary, as it may
consider proper; Provided, however, That this section shall not be construed to give the
WHETHER OR NOT THE SECURITY OR BOND MENTIONED IN SECTION 108 OF PD court authority to reopen the judgment or decree of registration, and that nothing shall be
1529 BEFORE ENTRY OF CORRECTION OR ALTERATION MAY BE MADE IS done or ordered by the court which shall impair the title or other interest of a purchaser
MANDATORY TO PROTECT THE INTEREST OF THIRD PERSON. holding a certificate for value and in good faith, or his heirs and assigns, without his or their
written consent. Where the owner's duplicate certificate is not presented, a similar petition
L. may be filed as provided in the preceding section. (emphasis supplied)
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Against Interest and that he was seriously ill at the time that he affixed his signature.
All petitions or motions filed under this Section as well as under any other provision of this
Decree after original registration shall be filed and entitled in the original case in which the From the foregoing, there is no question that there is a serious objection and an adverse
decree or registration was entered. claim on the part of an interested party as shown by petitioner's subsequent execution of
The Court notes that the petition was clearly one which was filed after original registration his Affidavit of Non-Waiver of Interest. The absence of unanimity among the parties is also
oi title, as provided under the abovequoted Section 2 of PD 1529. Moreover, respondent's evidenced by petitioner's petition seeking the annulment of the RTC Decision which
petition was filed with the RTC for the purpose of correcting supposed errors which were granted respondent's petition for correction of entries in the subject TCTs. These
committed when entries were made in the subject TCTs, as contemplated under Section objections and claims necessarily entail litigious and controversial matters making it
108 of the same law. imperative to conduct an exhaustive examination of the factual and legal bases of the
parties' respective positions. Certainly, such objective cannot be accomplished by the court
However, under settled jurisprudence, the enumerated instances for amendment or through the abbreviated action under Section 108 of PD 1529. A complete determination of
alteration of a certificate of title under Section 108 of PD 1529 are non-controversial in the issues in the present case can only be achieved if petitioner and his wife are
nature.13 They are limited to issues so patently insubstantial as not to be genuine issues. impleaded in an adversarial proceeding.
The proceedings thereunder are summary in nature, contemplating insertions of mistakes
which are only clerical, but certainly not controversial issues. In addition, the Court finds apropos to the instant case the ruling in the similar case
of Martinez v. Evangelista19 where the petitioner in the said case, being the registered
As early as the case of Tangunan v. Republic of the Philippines 14, which was later cited owner of certain real properties, sought to strike out the words "married to x x x" appearing
in Angeles v. Razon, et al.15, this Court, sitting en banc, ruled that: in the Transfer Certificates of Title covering the said properties on the ground that the
chanRoblesvirtualLawlibrary same was so entered by reason of clerical error or oversight and in lieu thereof the word
x x x the lower court did not err in finding that it lacks jurisdiction to entertain the present "single" be substituted, which according to the petitioner in the said case is his true and
petition for the simple reason that it involves a controversial issue which takes this case correct civil status. This Court held that:
out of the scope of Section 112 of Act No. 496 [now Section 108 of PD 1529]. While this chanRoblesvirtualLawlibrary
section, among other things, authorized a person in interest to ask the court for any x x x x changes in the citizenship of a person or in his status from legitimate to illegitimate
erasure, alteration, or amendment of a certificate of title "upon the ground that registered or from married lo not married are substantial as well as controversial, which can only be
interests of any description, whether vested, contingent expectant, or inchoate, have established in an appropriate adversary proceeding as a remedy for the adjudication of
terminated and ceased", and apparently the petition comes under its scope, such relief can real and justifiable controversies involving actual conflict of rights the final determination of
only be granted if there is unanimity among the parties, or there is no adverse claim or which depends upon the resolution of issues of nationality, paternity, filiation or legitimacy
serious objection on the part of any party in interest; otherwise the case becomes of the marital status for which existing substantive and procedural laws as well as other
controversial and should be threshed out in an ordinary case or in the case where the rules of court amply provide.20ChanRoblesVirtualawlibrary
incident properly belongs. Thus, it was held that "It is not proper to cancel an original In the present case, it is now apparent that before the trial court can alter the description of
certificate of Torrens title issued exclusively in the name of a deceased person, and to the civil status of respondent in the transfer certificates of title in question, it will have to
issue a new certificate in the name of his heirs, under the provisions of Section 112 of Act receive evidence of and determine respondent's civil status. This requires a full dress trial
No. 496, when the surviving spouse claims right of ownership over the land covered by rendering the summary proceedings envisaged in Section 108 of PD 1529 inadequate.
said certificate." And, in another case, where there was a serious controversy between the
parties as to the right of ownership over the properties involved, this court held, "that Finally, it is settled that a land registration case is a proceeding in rem, and jurisdiction in
following the principle laid down in the decision above cited, the issues herein should be rem cannot be acquired unless there be constructive seizure of the land through
ventilated in a regular action x x x."16(citations omitted) publication and service of notice.21 However, as found by the CA, respondent failed to
In the present case, the Court notes that in a separate action for annulment of title and comply with the said requirements. In all cases where the authority of the courts to
recovery of ownership filed by petitioner's wife against respondent, the RTC of Makati City, proceed is conferred by a statute, and when the manner of obtaining jurisdiction is
Branch 137, in its decision in Civil Case No. 91-2648, dated July 5, 1993, made a mandatory, it must be strictly complied with, or the proceedings will be utterly void. 22 It is
categorical finding that petitioner and his wife are the lawful owners of the subject wrong for the CA to rule in its Amended Decision that publication is not a jurisdictional
properties and ordering respondent to surrender possession thereof to the said requirement for the RTC to take cognizance of respondent's petition. The appellate court's
spouses.17 This RTC judgment was later affirmed by the CA in its Decision 18 in CA-G.R. reliance on the case of Chan v. Court of Appeals23 is misplaced. In the said case, this
CV No. 49446, dated April 29, 1997. Respondent, on the other hand, claims that she Court considered the notice to the Register of Deeds as substantial compliance with the
together with petitioner and his wife subsequently executed an amicable settlement dated notice and publication requirements of the law simply because in the petition for correction
June 22, 2000, which was approved by the RTC, wherein petitioner's wife waived her filed by the petitioner therein, only the said petitioner and the Register of Deeds had an
rights and interests over the said properties. She also alleged that petitioner executed an interest in the correction of titles sought for. This Court ruled that there is therefore no
Affidavit of Declaration Against Interest, dated January 22, 2007, indicating that he has no necessity to notify other parties who had no interest to protect in the said petition. This is
right or interest over the subject properties. Petitioner, nonetheless, claims that he not true, however, in the present case. As discussed above, on the bases of petitioner's
executed a subsequent Affidavit of Non-Waiver of Interest, dated January 14, 2008, serious objection and adverse claim, it is apparent that he has an interest to protect. Thus,
claiming that he was deceived by respondent into signing the said Affidavit of Declaration the ruling in Chan finds no application in the instant case.chanrobleslaw
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
WHEREFORE, the instant petition is GRANTED. The Amended Decision and Resolution GR No. 192353
of the Court of Appeals, dated August 29, 2011 and January 10, 2012, respectively, in CA-
G.R. SP No. 101406, are REVERSED and SET ASIDE. The Decision of the Court of
Appeals, dated January 27, 2011, which annulled the June 28, 2007 Decision of the MERCEDITA C. COOMBS Petitioner
Regional Trial Court of Muntinlupa City, Branch 203, is REINSTATED.
versus
SO ORDERED
DECISION
LEONARDO-DE CASTRO, J:
Before the Court is a petition for review on certiorari under Rule 45 of the Rules of Court,
as amended, seeking to reverse and set aside the Resolutions dated April 30, 2009 1 and
This case stemmed from a petition for annulment of judgment to declare the
Decision3 dated August 26, 2004 of the Regional Trial Court (RTC), Branch 206,
Muntinlupa City in LRC Case No. 04-035 as null and void, filed by herein petitioner
Mercedita C. Coombs (Coombs) before the Court of Appeals. The dispositive portion of the
WHEREFORE, judgment is hereby rendered declaring the lost owners duplicate copy of
Transfer Certificate of Title [No.] 6715 of the Registry of Deeds of Muntinlupa City as null
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
and void. Accordingly, the Register of Deeds of Muntinlupa City is ordered to issue a new In its Resolution dated April 30, 2009, relying on Section 1, Rule 47 of the Revised Rules
owners duplicate copy of the said TCT No. 6715 under the same terms and conditions as of Court, the Court of Appeals dismissed the petition for annulment of judgment. According
the original thereof and to include thereon all annotations which have not been lawfully to the appellate court -
4
ordered cancelled by the Court upon payment of all fees prescribed by law.
A careful reading of the petition reveals that there is no allegation in the petition that the
Petitioner Coombs narrated in the said petition that she is the owner of the real property petitioner has failed to avail of any of the aforementioned remedies in Section 1 through no
covered by Transfer Certificate of Title (TCT) No. 6715 situated on Apitong Street, Ayala fault of his before instituting the herein petition. This is an important condition for the
Alabang, Muntinlupa City; that sometime in March 2005, when she tried to pay the real availment of this remedy. The petition is also not sufficient in substance. Under Section 2[,]
property tax due relative to the real property covered by TCT No. 6715, she was told that Rule 47 of the Rules of Civil Procedure, the grounds for Annulment of Judgment are: (a)
said real property was no longer listed under her lame; that upon further verification, she lack of jurisdiction of the lower court; and (b) extrinsic fraud. Obviously, the ground relied
came to know that TCT No. 6715 had already been cancelled and had been replaced by upon in the present action is extrinsic fraud. However, the petitioner failed to state the facts
TCT No. 14115 issued in the name of herein respondent Virgilio Veloso Santos (Santos); constituting extrinsic fraud as a ground. Since the petitioner failed to avail [of] any of
that TCT No. 6715 was ordered cancelled by the RTC in a Decision dated August 26, 2004 aforementioned remedies in Section 1 without justification and that the ground relied upon
in LRC Case No. 04-035, entitled In Re: Petition for the Issuance of Second Owners was not substantiated, this petition has no prima facie merit. 7
Duplicate Copy of Transfer Certificate of Title No. 6715, [by] Mercedita C. Coombs,
Petitioner Coombs moved for the reconsideration of the above-quoted Resolution. She
represented by her Atty.-in-Fact Victoria C. Castaneda; that she neither authorized
insisted that her petition was grounded on lack of jurisdiction, not extrinsic fraud. In fact,
Victoria C. Castaneda (Castaneda) to file petition for issuance of a second owners
she explicitly spelled out in her petition that the RTC did not have jurisdiction over the
duplicate copy of TCT No. 6715 sometime in 2004, nor asked her to sell the subject
subject matter in LRC Case No. 04-035 because the owners duplicate copy of TCT No.
property to herein respondent Santos; that Santos, in turn, sold the same to herein
6715 was never lost.
respondents Pancho and Edith Leviste (spouses Leviste); that the spouses Leviste
executed a real estate mortgage over the subject property in favor of herein respondent In its assailed Resolution dated May 25, 2010, the Court of Appeals denied the said motion
5
Bank of the Philippine Islands Family Savings Bank (BPI Family). and explained that the RTC has jurisdiction over all proceedings involving title to real
property and land registration cases. Thus, it had jurisdiction over the subject matter of
Petitioner Coombs anchored her prayer for the annulment of the RTC Decision on the
LRC Case No. 04-035. It further held that petitioner Coombs failed to append affidavits of
ground that, since the owners duplicate copy of TCT No. 6715 had never been lost as it
witnesses or documents supporting her cause of action as required by Section 4, Rule 47
had always been in her custody,6 the RTC did not acquire jurisdiction over the subject
of the Rules of Court. It cited Veneracion v. Mancilla,8 where it was held that failure to
matter of LRC Case No. 04-035.
append the necessary documents may prompt the appellate court to dismiss the petition
The Assailed Court of Appeals Resolutions outright or deny the same due course. The dispositive portion of the Resolution reads:
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
WHEREFORE, premises considered, the instant motion is DENIED. Accordingly, the 2. [T]hat the Honorable Court of Appeals be directed to give due course to the petitioners
9
instant petition is DISMISSED WITH FINALITY. petition for annulment of judgment, declaration of nullity of sales and titles, and damages,
On the other hand, the spouses Leviste maintains (a) that petitioner Coombs petition was
First, petitioner Coombs asserts that she was never notified about the proceedings in LRC
grounded on extrinsic fraud and she failed to properly allege the facts constituting this
Case No. 04-035. Being a stranger to the case, she could not have availed of any of the
ground; (b) that the petition is infirm because petitioner Coombs did not comply with the
remedies mentioned in Section 1, Rule 47 of the Rules of Court to question the RTC
requirements of alleging her failure to resort to ordinary remedies, as enumerated in
Decision. She claims that she only found out about the RTCs decision sometime in March
Section 1, Rule 47 of the Rules of Court and appending the appropriate documents in
2005 in the course of paying for real estate taxes due on the subject property. By that time,
support of her cause of action; and (c) that petitioner Coombs admitted that a new owners
the RTC decision had already become final and executory. Thus, the failure to allege these
duplicate copy of TCT No. 6715 was issued by virtue of the RTC Decision. And, for their
circumstances is not fatal to her petition. 10
last point, they argue that the Petition for Annulment of Judgment is actually a collateral
Second, citing the Courts rulings in Strait Times, Inc. v. Court of Appeals,11 Serra Serra v. attack on their title that is not permitted pursuant to Section 48 of Presidential Decree No.
Court of Appeals,12 Alabang Development Corporation v. Valenzuela, 13 and Demetriou v. 1529, which states that a certificate of title cannot be altered, modified, or cancelled,
Court of Appeals,14 petitioner Coombs maintains that the RTC did not have jurisdiction over except in a direct proceeding in accordance with the law. 18
the subject matter in LRC Case No. 04-035 because the owners duplicate copy of the
For their part, respondent BPI Family contends that it should not have been impleaded in
TCT sought to be annulled was never lost and had always been in her possession. 15
the present petition. It maintains that it is simply a mortgagee in good faith and for value in
Third, petitioner Coombs insists that she appended all the relevant documents to support relation to the subject lot covered by TCT No. 6715. And the present petition seeks to
her Petition for Annulment of Judgment. But she did not append any witnesses affidavits nullify the RTC Decision to which the respondent bank was never a party of. Thus, BPI
because she does not have any witness other than herself. Besides, all the facts that may Family claims that the Court has no jurisdiction over it. 19
be set out in a separate affidavit are already averred in the present petition. Thus, lack
The Issue
thereof should not result in the petitions outright dismissal. 16
We are now left to resolve the lone issue of whether or not the Court of Appeals erred
Ultimately, Coombs prays for the following reliefs:
when it dismissed outright petitioner Coombs petition for annulment of judgment.
1. [T]hat this petition be given due course and that the assailed Resolutions of the Court of
The Ruling of the Court
Appeals be reversed and set aside;
The Court of Appeals erred when it dismissed outright the petition for annulment of To Our mind, the above-stated allegations made out a prima facie case of annulment of
The grounds for annulment of judgment are set forth in Section 2, Rule 47 of the Rules of In Manila v. Manzo,21 the Court held that in a petition for annulment of judgment grounded
Court, viz.: on lack of jurisdiction, it is not enough that there is an abuse of jurisdictional discretion. It
must be shown that the court should not have taken cognizance of the case because the
Section 2. Grounds for annulment. - The annulment may be based only on the grounds of
law does not confer it with jurisdiction over the subject matter.
extrinsic fraud and lack of jurisdiction.
It is doctrinal that jurisdiction over the nature of the action or subject matter is conferred by
Extrinsic fraud shall not be a valid ground if it was availed of, or could have been availed
law. Section 10 of Republic Act No. 2622vests the RTC with jurisdiction over the judicial
of, in a motion for new trial or petition for relief.
reconstitution of a lost or destroyed owners duplicate of the certificate of title. However,
Contrary to the findings of the Court of Appeals, the Petition for Annulment of Judgment the Court of Appeals erred when it ruled that the subject matter of LRC Case No. 04-035
filed by petitioner Coombs was clearly grounded on lack of jurisdiction of the RTC over the was within the RTCs jurisdiction, being a court of general jurisdiction.
In her petition, petitioner Coombs averred as follows: certificate sought to be reconstituted was never lost or destroyed but is in fact in the
possession of another person. In other words, the fact of loss of the duplicate certificate is
13. Since the owners duplicate copy of TCT No. 6715 is not lost or destroyed, but is in fact
jurisdictional.
in the possession of the petitioner, there is no necessity for the petition filed in the trial
court. The Regional Trial Court Branch 206 in Muntinlupa City never acquired jurisdiction Thus, petitioner Coombs mere allegation that the owners duplicate copy of TCT No. 7615
to entertain the petition and order the issuance of a new owners duplicate certificate. was never lost and has in fact always been with her gave rise to a prima facie case of the
Hence, the newly issued duplicate of TCT No. 6715 is null and void. 20 RTCs lack of jurisdiction over the proceedings in LRC Case No. 04-035. This is exactly
without jurisdiction. According to her, the RTC did not acquire jurisdiction over the subject Moreover, the Court of Appeals dismissal based on technical grounds (i.e., failure to
matter of LRC Case No. 04-035-one for the reconstitution of a lost certificate of title- allege that she did not avail of a motion for new trial, appeal, petition for relief, or other
because the owners duplicate copy of TCT No. 6715 was never lost in the first place, appropriate remedies and failure to append the affidavits of witnesses or documents
which argument has been upheld by the Court in a catena of cases that she cited to supporting the cause of action of her petition) was also erroneous.
First, when a petition for annulment of judgment is grounded on lack of jurisdiction, the WHEREFORE, the petition is hereby GRANTED. The Resolutions dated April 30, 2009
petitioner need not allege that the ordinary remedy of new trial or reconsideration of the and May 25, 2010 of the Court of Appeals in CA-G.R. SP No. 107949 are SET ASIDE.
judgment sought to be annulled are no longer available through no fault of her own. This is The Court of Appeals is directed to REINSTATE the Petition for Annulment of Judgment in
because a judgment rendered without jurisdiction is fundamentally void. Thus, it may be CA-G.R. SP No. 107949 and to proceed hearing the same with dispatch.
Second, petitioner Coombs in fact was able to attach to her petition documents supporting
Verily, our ruling in Veneracion25 required the petitioners to: (a) allege with particularity in
their petition the facts and the law relied upon for annulment as well as those supporting
their cause of action, and (b) attach to the original copy of their petition the affidavits of
In the present case, petitioner Coombs Petition for Annulment of Judgment was grounded
on lack of jurisdiction. Based on our review of the records, she annexed to her petition the
owners duplicate copy of TCT No. 6715 and the RTC Decision - which sufficiently support
the petitions cause of action. A copy of the TCT alleged (in LRC Case No. 04-035) to have
been missing supports the claim that the same was never lost. In the same vein, a copy of
Coombs averment that said decision was rendered without jurisdiction. Her allegations
coupled with the appropriate supporting documents give rise to a prima facie case that the
RTC did not have jurisdiction over the subject matter in LRC Case No. 04-035.
As we ruled in Tan Po Chu v. Court of Appeals,26 if allegations of this nature turned out
to be true, the RTC Decision would be void and the Court of Appeals would have
been duty-bound to strike it down. Thus, the appellate court erred when it brushed
aside this duty and dismissed the case outright based on a strict interpretation of technical
rules.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
G.R. No. 184348, April 04, 2016 responsible officer of FiberTech; (2) that Felix was aware of this fact; (3) that Felix
committed perjury when he executed the Affidavit of Loss; (4) that Felix and Rosita had not
TAN PO CHU, Petitioner, v. COURT OF APPEALS, FELIX T. CHINGKOE, ROSITA L. acquired 100% ownership of FiberTech; (5) that Rosita and Rodrigo Garcia were not even
stockholders of record in Fibertech; and (6) that the respondents had no authority to file
CHINGKOE, AND RODRIGO GARCIA, Respondents.
the petition for reissuance of the owner's duplicate copy on behalf of FiberTech. 9
DECISION Citing New Durawood Co. v. Court of Appeals10 and Serra Serra v. Court of Appeals,11 Tan
further argued that if an owner's duplicate TCT has not been lost, but is in fact possessed
BRION, J.: by another person, then the reconstituted title is void and the court that rendered the
decision never acquired jurisdiction.
This is a petition for certiorari filed by Tan Po Chu from the January 16, 2008 and July 16, However, the CA dismissed Tan's petition outright on January 16, 2008 on the grounds
2008 resolutions of the Court of Appeals (CA) in CA-G.R. SP No. 101727.1 The CA that the petition suffered from procedural infirmities and lacked substantial merit. 12
dismissed outright Tan's petition for annulment of the Regional Trial Court's (RTC) decision
in LRC CASE No. 2005-771-MK2 on the grounds that the petition suffered from procedural The CA observed that: (1) the verification and certification of non-forum shopping were
infirmities and lacked substantial merit. executed alone by Tan Po Chu without showing that she had the authority to sign for and
on behalf of the corporation; (2) Tan's actual address was not indicated in the petition as
Antecedents required by Rule 46, Section 3; and (3) the attached copy of the owner's duplicate TCT No.
157923 was not a certified true copy.
Fiber Technology Corporation (FiberTech) was a Philippine corporation with Securities and
Exchange Commission (SEC) Registration No. 0000142818. It was also the registered The CA also brushed aside Tan's substantive argument. It held that the RTC acquired
owner of a parcel of land in Marikina (subject lot) covered by Transfer Certificate of Title jurisdiction over the case after complying with the notice and hearing requirements under
(TCT) No. 157923 entered on November 28, 1988. The SEC allegedly revoked Section 109 of Presidential Decree (P.D.) No. 1529 or the Property Registration Decree. 13
FiberTech's registration on September 29, 2003.3
Tan moved for reconsideration. However, on July 16, 2008, the CA denied the motion,
On April 4, 2005, respondent Felix Chingkoe executed an affidavit of loss of TCT No. insisting that Tan's assertion that the RTC lacked jurisdiction was without merit. 14
157923 allegedly on behalf of FiberTech. 4
On September 19, 2008, Tan filed the present petition for certiorari.
On June 2, 2005, FiberTech - supposedly represented by respondent Rodrigo Garcia
pursant to a December 2, 2004 Board Resolution5 - filed a petition for the The Petition
reissuance/replacement of its owner's duplicate of TCT No. 157923. The petition was
based on the affidavit of loss that Felix executed. The petition alleged: (1) that Felix and Tan argues that the CA committed grave abuse of discretion in ruling that her allegation of
his wife Rosita acquired 3 00% ownership of FiberTech in 2004 pursuant to an award by the RTC's lack of jurisdiction was not meritorious. She maintains that the respondents
the National Labor Relations Commission (NLRC); (2) that Felix was elected Corporate misled the RTC because: (1) Felix and Rosita never became 100% owners of FiberTech;
Secretary soon after; (3) that Felix asked the former directors and officers of FiberTech to and (2) they knew that the "missing" owner's duplicate was in her possession. Pursuant to
turn over the owner's duplicate of TCT No. 157923, but the latter denied knowledge or the cases of New Durawood, Serra Serra, Strait Times v. CA,15 and Demetriou v. CA,16 the
possession thereof; and (4) that after conducting an exhaustive search, the subject title RTC never acquired jurisdiction to reconstitute the owner's duplicate TCT.
was nowhere,to be found.6
The respondents counter that the CA did not commit grave abuse of discretion in
The petition was raffled to the RTC, Marikina City, Branch 193 and docketed as LRC Case dismissing the petition. Further, assuming the CA decided in a manner contrary to
No. 2005-771-MK. prevailing jurisprudence, then it only committed an error of law and not an error of
jurisdiction. They conclude that Tan's resort to a special civil action of certiorari was
On July 23, 2006, the RTC granted the petition. It declared the owner's duplicate copy of unwarranted because the correct remedy would have been to appeal the dismissal of her
TCT No. 157923 as lost and ordered its reissuance. 7 petition.
On December 21, 2007, Tan Po Chu - mother of Fibertech's incorporators Faustino and
Our Ruling
respondent Felix Chingkoe - filed a petition before the CA for annulment of judgment
against the RTC's decision.8The petition was docketed as CA-G.R. SP No. 101727 with
At the outset, we observe that Tan resorted to the wrong remedy by filing a petition
Tan Po Chu and FiberTech as petitioners.
for certiorari under Rule 65. The. Rules of Court explicitly authorizes the CA to dismiss
outright a petition for annulment of judgment if the court finds no substantial merit in the
Tan alleged: (1) that the missing owner's duplicate of TCT was in her custody as the
petition.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Section 5. Action by the court. - Should the court find no substantial merit in the lawless thing, which can be treated as an outlaw and . slain at sight, or ignored wherever
petition, the same may be dismissed outright with specific reasons for such and whenever it exhibits its ugly head. 26 It may be attacked at any time.
dismissal.
If Tan's allegation were true, then the RTC's judgment would be void and the CA would
Should prima facie merit be found in the petition, the same shall be given due course and have been duty-bound to strike it down. The CA could have nipped this anomalous
summons shall be served on the respondent.17ChanRoblesVirtualawlibrary situation in the bud before it could cause any harm to innocent third persons. However, the
Accordingly, outright dismissal of Tan's petition is within the jurisdiction of the CA and its CA opted to turn its back on this duty and dismiss the case outright based on rigid
correctness may be reviewed through an appeal by certiorari under Rule 45. technicalities and on irrelevant considerations regardless of the implications to the general
public.
Certiorari is an extraordinary remedy of last resort for when another remedy is
present, certiorari is not available.18 It is a limited form of review confined to errors of Moreover, the CA's dismissal based on technical grounds was erroneous. The CA raised
jurisdiction. An error of jurisdiction is one where the officer or tribunal acted without or in the following procedural infirmities:
excess of its jurisdiction, or with grave abuse of discretion amounting to lack or excess of chanRoblesvirtualLawlibrary
jurisdiction.19 On the other hand, an error of judgment is one which the court may commit ...(1) the verification and certification of non-forum shopping was executed alone by affiant
in the exercise of its jurisdiction.20 They only involve errors in the court or tribunal's Tan Po Chu without any showing that [s]he had the authority to sign for and in behalf of
appreciation of the facts and of the law. 21 Errors of jurisdiction are reviewable on certiorari; petitioner corporation pursuant to Sec. 5(1), Rule 7 and Sec. 4(3), Rule 47 of the 1997
errors of judgment, only by appeal.22 Revised Rules of Civil Procedure considering that [s]he is one of the incorporators and
stockholders of her co-petitioner corporation; (2) The actual address of petitioner Tan Po
Ordinarily, this Court would have dismissed the petition outright for being an improper Chu is not indicated in the petition as required by Sec. 3 (1), Rule 46 of the same Rule; (3)
remedy. As a general rule, certiorari will not lie as a substitute for an appeal. However, an The copy of the owner's duplicate of TCT No. 157923 is not certified as a true copy of the
exception to this rule is where public welfare and the advancement of public policy so original owner's duplicate by the proper government agency as alleged by the
dictates.23 petitioners.27ChanRoblesVirtualawlibrary
First, we note that Tan alleged that FiberTech's corporate existence had already ceased
This Court cannot ignore the implications if the petitioner's allegations - that she has the when the SEC revoked its corporate registration on September 29, 2003, and that she was
original owner's duplicate TCT of the subject lot and that the SEC revoked FiberTech's a trustee of the corporation for the purpose of its dissolution. 28 We note further that the
registration in 2003 - are true. There will currently exist two owner's duplicate TCTs over petition for annulment was filed in the names of both FiberTech and Tan Po Chu.
the same property possessed by two contending factions in an intra-corporate dispute of a
defunct corporation. This anomalous situation can potentially bring considerable hann to While FiberTech may no longer have judicial personality to initiate the suit or authorize Tan
the general public and to the integrity of our Torrens system. This Court, therefore, cannot Po Chu to file the case, Tan Po Chu remained a real party-in-interest as the lawful
simply leave the parties as they were. possessor of the allegedly lost owner's duplicate TCT. The respondents could not legally
oust her of this possession by reconstituting the owner's duplicate instead of filing an
The CA committed a grave error when it brushed aside Tan's argument that the RTC action for replevin. Therefore, the verification and certification of non-forum shopping
rendered its decision without jurisdiction. It ruled that the replacement of a lost duplicate remained valid with respect to Tan Po Chu even though it might have been defective with
certificate is a proceeding in rem, directed against the whole world; therefore, the RTC respect to FiberTech.
acquired jurisdiction when it complied with the notice and hearing requirements under
Section 109ofP.D. 1529. Second, we also note that Tan Po Chu submitted her address in her motion for
reconsideration to cure the defect in the petition. 29 Her motion for reconsideration
The CA completely missed the point because Tan did not assail the RTC's jurisdiction by substantially complies with Rule 46, Section 3 of the Rules of Court.
alleging noncompliance with the requirements of notice and hearing; she questioned the
RTC's jurisdiction over the res by claiming that the allegedly lost owner's duplicate was, in Finally, a petition for annulment of judgment only requires the inclusion of a clearly legible
fact, not lost but was in her custody. Therefore, the RTC's compliance with Section 109 of duplicate original or certified true copy of the judgment, order, resolution, or ruling subject
P.D. 1529 was irrelevant. thereof.30 It does not require the petitioner to annex certified true copies or duplicate
originals of his evidence to the petition because these may be presented during the
We have consistently held that when the owner's duplicate certificate of title has not been evidentiary hearings of the case. To our mind, none of the procedural infirmities warranted
lost, but is in fact in the possession of another person, then the reconstituted certificate is the CA's outright dismissal of the case.
void because the court failed to acquire jurisdiction over the subject matter - the allegedly
lost owner's duplicate.24 The correct remedy for the registered owner against an Grave abuse of discretion is the capricious and whimsical exercise of judgment equivalent
uncooperative possessor is to compel the surrender of the owner's duplicate title through to an evasion of positive duty, or a virtual refusal to act
an action for replevin.
A judgment void for want of jurisdiction is no judgment at all. 25 It has been held to be a
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
G.R. No. L-15183 October 30, 1962 requiring him to secure the appointment of a legal representative to the estate of the
original registered owner, Paulino P. Gocheco and to obtain a judicial declaration of his
IN RE: ORIGINAL CERTIFICATE OF TITLE NO. O-1385, SP. NO. 695, BOOK NO. 1-5, lawful heirs before giving due course to his petition and (3) in dismissing the petition.
PATENTEE PAULINO P. GOCHECO, CESARIO GOCHECO, petitioner-appellant,
vs. The petition is only for the issuance of an owner's duplicate copy of O.C.T. No. O-1385, in
FRANCISCO T. ESTACIO, ET AL., oppositors-appellees. lieu of the one that was lost. Section 109 of Act No. 496, as amended, provides:
Climaco and Azcarraga for petitioner-appellant. SEC. 109. If a duplicate certificate is lost or destroyed or cannot be produced by
Antonio M. Ceniza for oppositors-appellees. a guarantee, heir, devisee, assignee, or other person applying for the entry of a
new certificate to him or for the registration of any instrument, a suggestion of the
PAREDES, J.: fact of such loss or destruction may be filed by the registered owner or other
person in interest and registered. The court may thereupon, upon the petition of
the registered owner or other persons in interest, after notice and hearing direct
Cesario Gocheco is a legitimate son of Paulino P. Gocheco registered owner of a parcel of the issue of a new duplicate certificate, which shall contain a memorandum of the
land, with improve comments, in Margosatubig, Zamboanga del Sur, as evidenced by fact that it is issued in place of the lost duplicate certificate, but shall in all
Original Certificate of Title No. O-1385 of the Register of Deeds for the said province. The respects be entitled to like faith and credit as the original duplicate for all the
owner's duplicate copy of the said original certificate of title was lost, and notwithstanding purposes of this act.
diligent search to ascertain its whereabouts, the said owner's duplicate copy has not been
found. However, in the records of the Register of Deeds of Zamboanga del Sur, the
original of the above number certificate No. O-1385 of title is found intact and complete in In view of the existence of the complete record in the Register of Deeds of Zamboanga del
Sp. No. 695, Book No. 1-5 patentee Paulino P. Gocheco. Sur, of the original of the certificate of title in question, which appears in Book No. 1-5 of
the said Register of Deeds' Office (Exh. A) and of the fact that the present petition is not
one for reconstitution as provided by Republic Act No. 26, there is no necessity for
On January 18, 1957, Cesario Gocheco, in his capacity as heir of the registered owner, publishing notice of the hearing thereof. And the petition, coming as it does, under the
filed a petition before the trial court to require the Register of Deeds of Zamboanga del Sur provisions of Section 109, aforequoted, there is likewise no need to first secure the
to issue another owner's duplicate copy of the O.C.T. No. O-1385, in lieu of the owners appointment of a legal representative of the estate and the declaration of the lawful heirs of
copy which was lost, copy of which petition was served to the Register of Deeds, thru the the deceased Paulino P. Gocheco. The petition does not at all seek the distribution of the
Provincial Fiscal, on April 30, 1957. Francisco T. Estacio and others opposed the petition, decedents estate. The owner's duplicate copy to be issued will be only an owner's
claiming that they have been in continuous, peaceful, lawful, public and adverse duplicate copy of the O.C.T. No. O-1385 and the petitioner is a person in interest is he is a
possession of the property covered by O.C.T. No. O-1385. On June 1, 1957, petitioner legal heir, according to his uncontroverted verified petition.
replied, stating that the oppositors can not intervene in the petition for want of personality
Industrial that to allow them to claim ownership and/or possession of the subject property
The oppositors-appellees, who had not chosen to file their brief, have no personality to
would defeat and destroy the indefeasibility of title guaranteed and protected by Act No.
496. intervene and their grounds of intervention, namely, that they have been in public,
continuous, peaceful, adverse and lawful possession of the property is immaterial,
impertinent and of no consequence, in the present proceeding. Their claim of ownership or
On June 29, 1957 petitioner appeared in Court and submitted his oral and documentary possession of the property can be properly instituted in a separate, independent and
evidence. Notwithstanding notice of hearing served upon them, the oppositors or their ordinary civil action.
counsel failed to appear. On the same day, however, the trial court entered an order
suspending hearing of the petition and required the petitioner to publish within 30 days his
petition or to file a testate or intestate proceeding, and to secure the appointment of a legal IN VIEW HEREOF, the order of June 29, 1957 of the Trial Court, appealed from, is set
representative to the estate of registered owner and the ultimate declaration of heirs. For aside, and another entered, directing the Register of Deeds of Zamboanga del Sur, to
failure of petitioners to comply with the order, on August 23, 1957, the oppositors filed issue to the petitioner a new owner's duplicate copy which was lost. With costs on the
an ex-parte motion to dismiss the petition. The Court, instead, on August 24, 1957 gave oppositors-appellees.
the petitioner 10 days within which to show cause why the petition should not be
dismissed. On September 3, 1957, petitioner filed his "constancia" manifesting that he was
submitting his case, on the evidences adduced in the hearing. On September 9, 1957, the
trial court dismissed the petition against which petitioner interposed the present appeal.
Petitioner-appellant alleges that the trial court erred (1) in requiring him to publish the
petition for the issuance of a new owner's duplicate copy of O.C.T. No. O-1385; (2) in
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
G.R. No. 176508, January 12, 2015 or justifiable ground to reconsider. 4chanRoblesvirtualLawlibrary
SAINT MARY CRUSADE TO ALLEVIATE POVERTY OF BRETHREN FOUNDATION, Hence, on February 22, 2007, the petitioner came directly to the Court alleging that
respondent Judge had unfairly abused his discretion and unlawfully neglected the
INC., Petitioner, v. HON. TEODORO T. RIEL, ACTING PRESIDING JUDGE, REGIONAL
TRIAL COURT, NATIONAL CAPITAL JUDICIAL REGION, BRANCH 85, QUEZON performance of an act which is specifically enjoined upon him as a duly [sic] under Rule 7,
CITY, Respondent. Section 8, of the Revised Rules of Court; 5that in finally dismissing the herein subject
UNIVERSITY OF THE PHILIPPINES, Intervenor. Petition for Reconsideration, respondent Honorable Acting Presiding Judge has acted
without and in excess of his authority and with grave abuse of discretion to the further
damage and prejudice of the herein petitioner; 6 and that it had no other remedy in the
DECISION course of law except through the present petition for certiorari and mandamus.cralawred
The Court directed respondent Judge and the Office of the Solicitor General (OSG) to
A petition for the judicial reconstitution of a Torrens title must strictly comply with the
comment on the petition for certiorari and mandamus. Respondent Judge submitted his
requirements prescribed in Republic Act No. 26; 1 otherwise, the petition should be
comment on May 23, 2007,7and the OSG its comment on July 19, 2007. 8 On November
dismissed.
13, 2007, the University of the Philippines (UP) sought leave to intervene, attaching to its
motion the intended comment/opposition-in-intervention.9 The motion for the UPs
This case is a direct resort to the Court by petition for certiorari and mandamus. The
intervention was granted on November 28, 2007. 10 In turn, the petitioner presented its
petitioner applied for the judicial reconstitution of Original Certificate of Title (OCT) No.
consolidated reply on February 8, 2008.11 The parties, except respondent Judge, then filed
1609 of the Register of Deeds of Quezon City, and for the issuance of a new OCT in place
their memoranda in compliance with the Courts directive.
thereof, docketed as L.R.C. Case No. Q-18987 (04), but respondent Acting Presiding
Judge of Branch 85 of the Regional Trial Court (RTC) in Quezon City dismissed the
Respondent Judge justified the dismissal of the petition for reconstitution by citing the
petition for reconstitution through the assailed order dated September 12, 2006. The
opposition by the OSG and the UP, as well as the recommendation of the Land
petitioner alleges that the respondent Judge thereby committed grave abuse of discretion
Registration Authority (LRA). He pointed out that the petitioner did not present its
and unlawful neglect of performance of an act specifically enjoined upon him. Equally
purported Torrens title to be reconstituted; that the petitioners claim was doubtful given the
assailed is the ensuing denial of its motion for reconsideration through the order dated
magnitude of 4,304,623 square meters as the land area involved;12 and that the UPs
February 5, 2007.
ownership of the portion of land covered by petitioners claim had long been settled by the
Court in a long line of cases.13chanRoblesvirtualLawlibrary
The antecedents follow.
The OSG and the UP argued that by directly coming to the Court by petition
On October 28, 2004, the petitioner claimed in its petition for reconstitution that the original
for certiorari and mandamus, the petitioner had availed itself of the wrong remedies to
copy of OCT No. 1609 had been burnt and lost in the fire that gutted the Quezon City
substitute for its lost appeal; that the correct recourse for the petitioner was an appeal
Register of Deeds in the late 80s. Initially, respondent Judge gave due course to the
considering that the two assailed orders already finally disposed of the case; that the
petition, but after the preliminary hearing, he dismissed the petition for reconstitution
petitioner intended its petition for certiorari and mandamus to reverse the final
through the first assailed order of September 12, 2006, 2 to wit:chanroblesvirtuallawlibrary
orders;14 that the petitioner further failed to observe the doctrine of hierarchy of courts,
despite the Court of Appeals (CA) having concurrent jurisdiction with the Court over
With the receipt of Report dated July 14, 2006 from Land Registration Authority (LRA) special civil actions under Rule 65;15 that the RTC would have gravely erred had it
recommending that the petition be dismissed, and considering the Opposition filed by the proceeded on the petition for reconstitution despite the petitioner not having notified the
Republic of the Philippines and University of the Philippines, the above-entitled petition is adjoining owners of the land or other parties with interest over the land;16 that the petitioner
hereby ordered DISMISSED. had no factual and legal bases for reconstitution due to its failure to prove the existence
and validity of the certificate of title sought to be reconstituted, in addition to the ownership
On October 11, 2006, the petitioner moved for reconsideration of the dismissal, 3 attaching of the land covered by the petition for reconstitution being already settled in a long line of
the following documents to support its petition for reconstitution, namely: (1) the copy of cases; that the petitioners claim over the land was derived from the Deed of Assignment
the original application for registration dated January 27, 1955; (2) the notice of initial executed by one Marcelino Tiburcio the same person whose claim had long been settled
hearing dated June 23, 1955; (3) the letter of transmittal to the Court of First Instance in and disposed of in Tiburcio v. Peoples Homesite and Housing Corporation and University
Quezon City; (4) the copy of the Spanish Testimonial Title No. 3261054 dated March 25, of the Philippines (106 Phil. 477), which vested title in the UP, and in Caero v. University
1977 in the name of Eladio Tiburcio; (5) the copy of Tax Assessment No. 14238; and (6) of the Philippines (437 SCRA 630); and that the Deed of Transfer and Conveyance dated
the approved Plan SWD-37457. November 26, 1925 executed by Tiburcio in favor of St. Mary Village Association, Inc. was
not a basis for the judicial reconstitution of title accepted under Section 2 of Republic Act
On February 5, 2007, the RTC denied the motion for reconsideration for lack of any cogent No. 26.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
In its memorandum, the petitioner indicates that the RTC gravely abused its discretion (b) The co-owner's, mortgagee's, or lessee's duplicate of the certificate of title;
amounting to lack or excess of its jurisdiction in dismissing its petition for reconstitution on
the basis of the recommendation of the LRA and the opposition of the Republic and the UP (c) A certified copy of the certificate of title, previously issued by the register of deeds or by
despite having initially given due course to the petition for reconstitution. It urges that the a legal custodian thereof;
dismissal should be overturned because it was not given a chance to comment on the
recommendation of the LRA, or to controvert the oppositions filed. 17 It contends that the (d) An authenticated copy of the decree of registration or patent, as the case may be,
LRA report did not substantiate the allegation of dismissal of the application for registration pursuant to which the original certificate of title was issued;
of Marcelino Tiburcio on October 17, 1955, in addition to the veracity of the report being
questionable by virtue of its not having been under oath. 18chanRoblesvirtualLawlibrary (e) A document, on file in the registry of deeds, by which the property, the description of
which is given in said document, is mortgaged, leased or encumbered, or an authenticated
Ruling copy of said document showing that its original had been registered; and
The petition for certiorari and mandamus, being devoid of procedural and substantive (f) Any other document which, in the judgment of the court, is sufficient and proper basis
merit, is dismissed. for reconstituting the lost or destroyed certificate of title.
Firstly, certiorari, being an extraordinary remedy, is granted only under the conditions Sec. 3. Transfer certificates of title shall be reconstituted from such of the sources
defined by the Rules of Court. The conditions are that: (1) the respondent tribunal, board hereunder enumerated as may be available, in the following order:
or officer exercising judicial or quasi-judicial functions has acted without or in excess of its
or his jurisdiction, or with grave abuse of discretion amounting to lack or excess of (a) The owner's duplicate of the certificate of title;
jurisdiction; and (2) there is no appeal, or any plain, speedy, and adequate remedy in the
ordinary course of law.19Without jurisdiction means that the court acted with absolute lack (b) The co-owner's, mortgagee's, or lessee's duplicate of the certificate of title;
of authority; there is excess of jurisdiction when the court transcends its power or acts
without any statutory authority; grave abuse of discretion implies such capricious and (c) A certified copy of the certificate of title, previously issued by the register of deeds or by
whimsical exercise of judgment as to be equivalent to lack or excess of jurisdiction; in a legal custodian thereof;
other words, power is exercised in an arbitrary or despotic manner by reason of passion,
prejudice, or personal hostility; and such exercise is so patent or so gross as to amount to (d) The deed of transfer or other document, on file in the registry of deeds, containing the
an evasion of a positive duty or to a virtual refusal either to perform the duty enjoined or to description of the property, or an authenticated copy thereof, showing that its original had
act at all in contemplation of law. 20chanRoblesvirtualLawlibrary been registered, and pursuant to which the lost or destroyed transfer certificate of title was
issued;
The petition for certiorari and mandamus did not show how respondent Judge could have
been guilty of lacking or exceeding his jurisdiction, or could have gravely abused his (e) A document, on file in the registry of deeds, by which the property, the description of
discretion amounting to lack or excess of jurisdiction. Under Section 12 21 of Republic Act which is given in said document, is mortgaged, leased or encumbered, or an authenticated
No. 26, the law on the judicial reconstitution of a Torrens title, the Regional Trial Court (as copy of said document showing that its original had been registered; and
the successor of the Court of First Instance) had the original and exclusive jurisdiction to
act on the petition for judicial reconstitution of title. Hence, the RTC neither lacked nor (f) Any other document which, in the judgment of the court, is sufficient and proper basis
exceeded its authority in acting on and dismissing the petition. Nor did respondent Judge for reconstituting the lost or destroyed certificate of title.
gravely abuse his discretion amounting to lack or excess of jurisdiction considering that the
petition for reconstitution involved land already registered in the name of the UP, as Thirdly, with the questioned orders of the RTC having finally disposed of the application for
confirmed by the LRA. Instead, it would have been contrary to law had respondent Judge judicial reconstitution, nothing more was left for the RTC to do in the case. As of then,
dealt with and granted the petition for judicial reconstitution of title of the petitioner. therefore, the correct recourse for the petitioner was to appeal to the Court of Appeals by
notice of appeal within 15 days from notice of the denial of its motion for reconsideration.
Secondly, the petitioner did not present the duplicate or certified copy of OCT No. 1609. By allowing the period of appeal to elapse without taking action, it squandered its right to
Thereby, it disobeyed Section 2 and Section 3 of Republic Act No. 26, the provisions that appeal. Its present resort to certiorari is impermissible, for an extraordinary remedy like
expressly listed the acceptable bases for judicial reconstitution of an existing Torrens title, certiorari cannot be a substitute for a lost appeal. That the extraordinary remedy
to wit:chanroblesvirtuallawlibrary of certiorari is not an alternative to an available remedy in the ordinary course of law is
clear from Section 1 of Rule 65, which requires that there must be no appeal, or any plain,
speedy, and adequate remedy in the ordinary course of law. Indeed, no error of judgment
Sec. 2. Original certificates of title shall be reconstituted from such of the sources
by a court will be corrected by certiorari, which corrects only jurisdictional
hereunder enumerated as may be available, in the following order:
errors.22chanRoblesvirtualLawlibrary
(a) The owner's duplicate of the certificate of title;
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Fourthly, the filing of the instant special civil action directly in this Court is in disregard of G.R. No. 146081 July 17, 2006
the doctrine of hierarchy of courts. Although the Court has concurrent jurisdiction with the
Court of Appeals in issuing the writ of certiorari, direct resort is allowed only when there REPUBLIC OF THE PHILIPPINES, Represented by the Land Registration
are special, extra-ordinary or compelling reasons that justify the same. The Court enforces
Authority, petitioner,
the observance of the hierarchy of courts in order to free itself from unnecessary, frivolous vs.
and impertinent cases and thus afford time for it to deal with the more fundamental and SPOUSES ROBERTO and MARINA SANCHEZ, respondents.
more essential tasks that the Constitution has assigned to it. 23 There being no special,
important or compelling reason, the petitioner thereby violated the observance of the
hierarchy of courts, warranting the dismissal of the petition for certiorari. DECISION
Finally, the land covered by the petition for judicial reconstitution related to the same area CARPIO, J.:
that formed the UP campus. The UPs registered ownership of the land comprising its
campus has long been settled under the law. Accordingly, the dismissal of the petition for
judicial reconstitution by respondent Judge only safeguarded the UPs registered The Case
ownership. In so doing, respondent Judge actually heeded the clear warnings to the lower
courts and the Law Profession in general against mounting or abetting any attack against This is a petition for review1 of the Decision2 dated 31 August 2000 and Resolution dated
such ownership. One such warning was that in Caero v. University of the Philippines,24as 17 November 2000 of the Court of Appeals. The 31 August 2000 Decision granted the
follows:chanroblesvirtuallawlibrary petition of respondent spouses Roberto and Marina Sanchez ("respondents") to set aside
the ruling of the Regional Trial Court, Quezon City, Branch 225 ("trial court") in a suit for
We strongly admonish courts and unscrupulous lawyers to stop entertaining spurious reconstitution of title. The 17 November 2000 Resolution denied the motion for
cases seeking further to assail respondent UPs title. These cases open the dissolute reconsideration of petitioner Land Registration Authority ("petitioner").
avenues of graft to unscrupulous land-grabbers who prey like vultures upon the campus of
respondent UP. By such actions, they wittingly or unwittingly aid the hucksters who want The Facts
to earn a quick buck by misleading the gullible to buy the Philippine counterpart of the
proverbial London Bridge. It is well past time for courts and lawyers to cease wasting their
time and resources on these worthless causes and take judicial notice of the fact that On 28 May 1996, respondents filed a petition ("LRC Case No. Q-96-8296") in the trial court
respondent UPs title had already been validated countless times by this Court. Any ruling to reconstitute the original of Transfer Certificate of Title No. 252708 ("TCT No. 252708"),
deviating from such doctrine is to be viewed as a deliberate intent to sabotage the rule of covering a parcel of land measuring 2,991 square meters ("Lot 1"). 3 Respondents claimed
law and will no longer be countenanced.25 that TCT No. 252708 was issued in the name of respondent Marina Sanchez ("Marina") by
the Register of Deeds, Quezon City. Respondents alleged that the original of TCT No.
WHEREFORE, the Court DISMISSES the petition for certiorari and mandamus for lack of 252708 was among the documents destroyed by the fire which razed the Office of the
merit; and ORDERS the petitioner to pay the costs of suit. Register of Deeds, Quezon City in June 1988. Respondents sought reconstitution under
Section 3(a)4 of Republic Act No. 265 ("RA 26") based on Marina's duplicate title.
SO ORDERED.cralawlawlibrary
The trial court scheduled the case for hearing on 15 August 1996. The notice of hearing
dated 30 May 1996 was published in the 8 and 15 July 1996 issues of the Official Gazette
and posted at the main entrance of the City Hall and the Hall of Justice, Quezon City on 1
July 1996. Petitioner, the Office of the Solicitor General, the Land Management Section,
Surveys Division of the Department of Environment and Natural Resources, the Office of
the Quezon City Prosecutor, and the Register of Deeds, Quezon City were furnished
copies of the notice of hearing.
The Solicitor General filed his Comment to the petition, noting that since the petition is
based on Section 3(a) of RA 26, the trial court should defer acting on the petition until the
Land Registration Authority (LRA) has submitted its Report on the petition as required
under Land Registration Commission (now LRA) Circular No. 35 ("Circular No. 35").6
Reconstitution Division, LRA. The First Report, which was endorsed 7 to the trial court in a By:
letter signed by Salvador L. Oriel ("Oriel"), Chief, Docket Division, LRA, reads in full:
[Sgd.]
REPORT
BENJAMIN M. BUSTOS
COMES NOW the Land Registration Authority and to the Honorable Court Reconstituting Officer & Chief,
respectfully reports that: Reconstitution Division8
(1) The present petition seeks the reconstitution of Transfer Certificate of Title
No. 252708, allegedly lost or destroyed and supposedly covering Lots 12, 13, 14, As no opposition was filed against the petition, the trial court allowed respondents to
15, & 16 all of Blocks 5, of (LRC) Psd-4786, respectively, on the basis of the present evidence ex parte.Apart from the First Report, respondents also presented a
owner's duplicate thereof, reproductions of which, not certified by the clerk of Certification, dated 14 December 1994, of the Quezon City Register of Deeds, that the
Court, as required under LRC circular 35, Series of 1983, were submitted to this original of TCT No. 252708 was among those destroyed in the 1988 fire. Respondents
Authority. further presented a Certification, dated 14 May 1996, of the Office of the City Treasurer,
Quezon City, confirming that respondents last paid the real estate taxes on Lot No. 1 in
January 1996.
(2) The technical description of the consolidation of Lots, 12, 13, 14, 15 & 16 all
of Block 5, Psd-4786, appearing in the reproduction of Transfer Certificate of Title
No. 252708, respectively, have been examined and verified against the technical The Ruling of the Trial Court
description on file in the Volume 2753 in the Vault Section Docket Division, this
Authority. Said technical description when plotted in the Municipal Index Sheet In its Order dated 28 October 1996 ("28 October 1996 Order"), the trial court granted
No. 3669-C do [sic] not appear to overlap previously plotted/decreed properties reconstitution and ordered TCT No. 252708 reconstituted. The 28 October 1996 Order
in the area. became final on 6 January 1997. The Register of Deeds, Quezon City issued to
respondents reconstituted Transfer Certificate of Title No. RT-115027 (252708) ("TCT No.
The technical description of Lot 1, Pcn-04-000007 of the cosolidation [sic] of Lots RT-115027").
12, 13, 14, 15 & 16 of Block 5, appearing in the reproductions of Transfer
Certificate of Title No. 252708, respectively have been examined and verified In a letter dated 4 November 1997, Oriel submitted to the trial court another Report, dated
against the Lot Description on file in the vault section, Docket Division, this 24 October 1997 ("Second Report"), also signed by Bustos. Oriel informed the trial court
Authority. Said technical descriptions when plotted in the Municipal Index Sheet that the First Report was fake. The Second Report, which recommended that the trial court
No. 3669-C do not appear to overlap previously plotted/decreed properties in the set aside the 28 October 1996 Order, reads:
area.
REPORT
WHEREFORE, the foregoing information anent the lots in question is respectfully
submitted for consideration in the resolution of the instant petition, and if the
COMES NOW the Land Registration Authority, and to the Honorable Court
Honorable Court, after notice and hearing, finds justification pursuant to Section
respectfully reports that:
15 of the Republic Act No. 26 to grant the same, the owners [sic] duplicate of
Transfer Certificate of Title No. 252708 may be used as sources [sic] of the
desired reconstitution pursuant to Section 3 (a) of said Act. Provided, however, (1) The above-entitled case appears to seek the reconstitution of Transfer
that in case the petition is granted, the reconstituted title should be made subject Certificate of Title No. 252708 allegedly lost or destroyed and supposedly
to such encumbrances as maybe subsisting, and provided, further, that no covering Lot 1, Pcn-04-000007, situated at Quezon City, as indicated in the copy
certificate of title covering the same parcels of land exists in the office of the of the Notice of Hearing dated May 30, 1996, submitted to this Authority.
Register of Deeds Concerned [sic]. Attached also to our records of this case is a xerox copy of the purported
Transfer Certificate of Title No. 252708 covering Lot 1, Pcn-04-000007 in the
name of Marina Sanchez, not certified by the Clerk of Court, as required under
Quezon City, Philippines, September 5, 1996.
LRC Circular 35, Series of 1983.
REYNALDO Y. MAULIT (2) In the 1st Indorsement dated October 21, 1997 of Engr. Alberto H. Lingayo,
Administrator Acting Chief, Ordinary and Cadastral Decree Division, this Authority, xerox copy
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
attached as Annex "A", the following information are stated relative to the above- By:
entitled petition and its enclosures[] to wit:
[Sgd.]
1. On or about October 1, 1997, a certain Marvin Bautista came to this office to
inquire about the above petition, showing a copy of the reconstituted title No. RT-
115027 (252708) and a copy of a report purportedly issued by this Authority, BENJAMIN M. BUSTOS
xerox copies attached as Annexes "B" & "C"; Reconstituting Officer & Chief,
Reconstitution Division9
2. We checked our records and found out that on August 6, 1996, we sent a
letter to the Clerk of Court requiring petitioner to submit to this Authority, certain On 24 March 1998, petitioner filed a Manifestation and Motion to set aside the 28 October
documents, however, petitioner has not yet complied as of this date, hence, 1996 Order. Petitioner contended that considering the Second Report, respondents'
we could not have rendered a report, xerox copy attached as Annex "D"; petition should be considered as having been filed under Section 3(f) 10 of RA 26, that is,
based on "any other document." Petitioner pointed out that under Section 13 11 in relation to
3. On October 2, 1997, we secured from the RTC Branch 225, Quezon City, Section 1212 of RA 26, the notice of a petition for reconstitution of lost or destroyed titles
certified copies of pertinent documents relative to the above-petition and based on Section 3(f) should not only be published and posted but also served on, among
found out that there is indeed a copy of a fake LRA Report, copies attached others, the owners of the adjoining properties. For non-compliance with this requirement,
hereto; the trial court did not acquire jurisdiction over LRC Case No. Q-96-8296.
4. Initial verification of the purported TCT No. 252708 reveals that the same Respondents opposed petitioner's motion, primarily on the ground that the 28 October
is a questionable title, because, among other reasons, the Serial No. 1996 Order had become final.
3002163 appearing on the face of the certificate pertains to x x x judicial
forms issued to the Registry of Deeds of Manila on January 13, 1976, as per The heirs of Mario Uy ("Heirs"), whose predecessor-in-interest allegedly owned Lot No. 12
records on file at the Property Section, this Authority; and it overlaps covered by Transfer Certificate of Title No. 187042, filed an "amicus curiae" brief disclosing
properties covered by TCT Nos. 187042 and 187040 when plotted on our that they have caused the filing of criminal complaints against respondents for Falsification
Municipal Index Map. of TCT No. 252708 (Criminal Case No. 77668) and Use of Falsified Public Document
(Criminal Case No. 90649).13 Mario Uy and Maria Corazon Uy-Zalamea ("Zalamea), the
5. It is suggested that this case be referred to proper authorities for investigation latter being the alleged owner of Lot No. 13 covered by TCT No. 187042, had earlier sued
and prosecution of the perpetrators, and that the order of reconstitution rendered respondents in the Regional Trial Court, Quezon City, Branch 227 ("Civil Case No. Q-96-
by the court be recommended vacated or set aside because it was obtained 29545") for quieting of title, nullity of [TCT No. 252708], recovery of possession and
through fraud and forgery. damages.14
WHEREFORE, the foregoing observation anent the lot in question is respectfully In its Order of 17 July 1998 ("17 July 1998 Resolution"), the trial court set aside the 28
submitted for the information and guidance of the Honorable Court, with the October 1996 Order and dismissed LRC Case No. Q-96-8296. The trial court held:
recommendation that the order of reconstitution rendered relative to the
purported Transfer Certificate of Title No. 252708 be ordered vacated or set Records reveal, x x x, that TCT No. 25[2]708, the title to be reconstituted,
aside and the corresponding title that was issued be declared null and void. overlaps TCT Nos. 187040 and 187042. Petitioners' design of having their title
reconstituted, notwithstanding the fact that the same is covered in two other
That the person[] or persons responsible for the reconstitution of this titles, eludes the comprehension of this Court.
questionable title be investigated and if evidence warrants be charged or
prosecuted in Court. xxxx
Quezon City, Philippines, October 24, 1997. The unscrupulous manner by which the petitioners misled the Court is glaring in
two (2) instances, to wit: 1) the petition unceremoniously omitted the names of
the registered owners of TCT Nos. 187040 and 187042; and 2) the spurious LRA
REYNALDO Y. MAULIT Report submitted by the petitioners.
Administrator
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
This Court is of the view that the failure to notify the registered owners of TCT accident, mistake, or excusable negligence relied upon, and the facts constituting
Nos. 187040 and 187042 of the Reconstitution proceeding proved to be a the petitioner's good and substantial cause of action or defense, as the case may
mistake. be.
Section 13, Republic Act No. 26 x x x provides that "x x x x The Court shall xxxx
likewise cause a copy of the notice to be sent, by registered mail or otherwise, at
the expense of the petitioner, to every person named therein whose address is As mentioned previously, the LRA, represented by the OSG, contends that notice
known, at least thirty days prior to the date of the hearing. Said notice shall state
of the petition should have been served on adjoining landowners as one of the
among other things, the number of the lost or destroyed certificate[] of title[,] if jurisdictional requirements, since the Authentic LRA Report of 24 October 1997
known, the name of the registered owner, the name[s] of the occupants or found petitioners' title to be a fake title. However, a mere LRA Report cannot
persons in possession of the property, the owner[s] of the adjoining properties declare a certificate of title spurious without the proper court declaring its nullity
and all other interested parties, the location, area and boundaries of the property, and cancellation. A certificate of title cannot be subject to collateral attack and
and the date on which all persons having any interest therein, must appear and can be altered, modified or cancelled only in a direct proceeding in accordance
file their claim o[r] objection to the petition. The petitioner shall, at the hearing, with law. Incidentally, private respondents filed an action for quieting of title,
submit proof of the publication, posting and service of the notice as directed by nullity of title (viz., TCT No. 252708), recovery of possession and damages
the court." against petitioners, which is still pending before Branch 227, Regional Trial Court
of Quezon City. Until the trial court declares TCT No. 252708 to be void and
Petitioners' failure to comply with this provision is a fatal defect for the same is orders its cancellation, [w]e cannot but recognize the validity of the same.
mandatory and jurisdictional (Ortigas and Company Limited Partnership vs. Granting that a suspicion or cloud of doubt was cast on the genuineness and
Velasco, 234 SCRA 435). authenticity of petitioners' certificate of title, the same was brought to the fore
belatedly. A Certificate of Finality had already been issued on 06 January 1997.
When this Court issued the questioned order dated October 28, 1996, it was Presumably, the proper parties received a copy of the Order dated 28 October
1996 on or before 21 December 1996. Entry of Judgment having been made on
under the impression that there was no legal impediment for the reconstitution of
TCT No. 252708. Had it been apprised at that time that the LRA report submitted 06 January 1997, a petition for relief from judgment should have been filed on or
by the petitioner was spurious then it would not have issued the before 05 July 1997. The Manifestation and Motion was only filed on 24 March
same.15(Italicization in the original) 1998, long after the order of reconstitution had become final and a reconstituted
title actually issued petitioners. There having been no sufficient evidence to
discredit petitioners' duplicate of the certificate of title within the time to appeal,
Respondents sought reconsideration but the trial court denied their motion on 4 January move for new trial or file a petition for relief, there is no need to serve notice of
1999. the petition on the adjoining landowners under Section 13 of RA No. 26. Said
section applies only when the source of reconstitution is other than the owner's
Respondents filed a petition for certiorari in the Court of Appeals. The appellate court duplicate of the certificate of title. x x x xThus, at the time the Order of 28 October
initially dismissed the petition for respondents' failure to submit a certified true copy or 1996 was rendered, respondent court was properly clothed with jurisdiction. After
duplicate original of the trial court's 17 July 1998 and 4 January 1999 Resolutions. said order became final, and the petition for relief having been foreclosed against
However, on respondents' motion, the Court of Appeals, without giving due course to the aggrieved parties, respondent judge was without jurisdiction to entertain the
petition, required petitioner and respondents to file Comment and Reply, respectively. attack against the order of reconstitution. x x x x
The Ruling of the Court of Appeals Moreover, it must be remembered that the fallo of the Decision dated 28 October
1996 contains a caveat, i.e., "provided, however, that no certificate of title
covering the same parcel of land exists in the office of the Register of Deeds."
In its Decision of 31 August 2000, the Court of Appeals granted respondents' petition, set The reconstituted title issued petitioners militates against any doubt or suspicion
aside the trial court's 17 July 1998 and 4 January 1999 Resolutions, and reinstated the 28 cast on their title. The Registrar of Deeds concerned would not have issued a
October 1996 Order. The appellate court held: reconstituted title had the land covered by TCT No. 252708 already been
covered by another certificate of title. Thus, [w]e reiterate, until Branch 227,
The motion to set aside the [28 October 1996 Order] contemplates a petition for Regional Trial Court of Quezon City declares TCT No. 252708 to be void and
relief from a final order entered against a party in any court through fraud, orders its cancellation, [w]e cannot but recognize the validity of the same.
accident, mistake, or excusable negligence under Rule 38 of the 1997 Rules of
Civil Procedure, which must be filed within sixty (60) days after the petitioner The allegation of fraud requires a higher burden of persuasion, but this Court
learns of the final order, and not more than six (6) months after such final order maintains that the reconstitution proceeding, which has now become final, is not
was entered, and must be accompanied with affidavits showing the fraud,
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
the proper forum to thresh out the same. It is a fundamental rule that when a final which in turn governs those petitions based on specified sources. We quote
judgment becomes executory, it thereby becomes immutable and unalterable Section 12 below:
and any amendment or alteration which substantially affects a final and
executory judgment is null and void for lack of jurisdiction, including the entire
"SEC. 12. Petition for reconstitution from sources enumerated in
proceedings held for that purpose. Thus, it is as if no Manifestation and Motion Section 2(c), 2(d), 2(e), 2(f), 3(c), 3(d), 3(e), and/or 3(f) of this Act, shall
was filed and no suspicion or cloud of doubt was cast on the genuineness and be filed with the proper Court of First Instance, by the registered owner,
authenticity of petitioners' certificate of title by the presentation of the LRA Report his assigns, or any person having an interest in the property. The
of 24 October 1997.16 petition shall state or contain, among other things, the following: x x x
(e) the name and addresses of the occupants or persons in possession
Petitioner sought reconsideration but the appellate court denied its motion in the of the property, of the owners of the adjoining properties and of all
Resolution of 17 November 2000. persons who may have interest in the property; x x x x All the
documents, or authenticated copies thereof, to be introduced in
Hence, this petition. Petitioner reiterates its claim that the trial court did not acquire evidence in support to the petition for reconstitution shall be attached
jurisdiction over LRC Case No. Q-96-8296 for lack of actual notice to all interested parties thereto and filed with the same: Provided, That in case the
as required under Section 13 in relation to Section 12 of RA 26. reconstitution is to be made exclusively from sources enumerated in
Section 2(f) or 3(f) of this Act, the petition shall be further accompanied
with a plan and technical description of the property duly approved by
In their Comment, respondents countered that the actual notice requirement in Section 13 the Commissioner of Land Registration, or with a certified copy of the
does not apply to LRC Case No. Q-96-8296 because that case was based on Marina's description taken from a prior certificate of title covering the same
duplicate copy of TCT No. 252708. At any rate, respondents contended that it is the property."
posting and publication of the notice of hearing, not its actual service, which vests
jurisdiction to the trial court, citing our ruling in Calalang v. Register of Deeds of Quezon
City.17 Lastly, respondents maintained that the 28 October 1996 Order is already final and In other words, the requirements under Sections 12 and 13 do not apply to all
petitions for judicial reconstitution, but only to those based on any of the sources
can no longer be set aside.
specified in Section 12, that is, "sources enumerated in Section 2(c), 2(d), 2(e),
2(f), 3(c), 3(d), 3(e), and/or 3(f) of this Act."
The Issue
Sections 2 and 3 of RA 26 provide as follows:
The question is whether the trial court acquired jurisdiction over LRC Case No. Q-96-8296.
"SEC. 2. Original certificates of title shall be reconstituted from such of
The Ruling of the Court the sources hereunder enumerated as may be available, in the
following order:
We hold in the negative and accordingly grant the petition.
(a) The owner's duplicate of the certificate of title;
The Actual Notice Requirement under Section 13 in Relation
to Section 12 of RA 26 Applies Here (b) The co-owner's, mortgagee's, or lessee's duplicate of the
certificate of title;
Respondents are correct in saying that the service of notice of the petition for
reconstitution filed under RA 26 to the occupants of the property, owners of the adjoining (c) A certified copy of the certificate of title, previously issued
properties, and all persons who may have any interest in the property is not required if the by the register of deeds or by a legal custodian thereof;
petition is based on the owner's duplicate certificate of title or on that of the co-owner's,
mortgagee's, or lessee's. This was our ruling in Puzon v. Sta Lucia Realty and
Development, Inc.,18involving a petition filed with the Regional Trial Court of Quezon City, (d) An authenticated copy of the decree of registration or
Branch 80, ("Branch 80") for reconstitution of the original of two Torrens certificates of title patent, as the case may be, pursuant to which the original
based on Puzon's duplicate certificates of title. We held in that case: certificate of title was issued;
[T]he first sentence of Section 13 provides that the requirements therein pertain (e) A document, on file in the registry of deeds, by which the
only to petitions for reconstitution filed under "the preceding section," Section 12, property, the description of which is given in said document, is
mortgaged, leased or encumbered, or an authenticated copy
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Land Titles and Deeds (Finals) 2017
of said document showing that its original had been certificates of title reconstituted pursuant to this section shall not be
registered; and subject to the encumbrance referred to in Section Seven of this Act."
(f) Any other document which, in the judgment of the court, is Nothing in this provision requires that notices be sent to owners of adjoining lots.
sufficient and proper basis for reconstituting the lost or Verily, that requirement is found in Section 13, which does not apply to petitions
destroyed certificate of title. based on an existing owner's duplicate TCT.
"SEC. 3. Transfer certificates of title shall be reconstituted from such of Put differently, Sections 9 and 10 of RA 26 require that 30 days before the date
the sources hereunder enumerated as may be available, in the of hearing, (1) a notice be published in two successive issues of the Official
following order: Gazette at the expense of the petitioner, and (2) such notice be posted at the
main entrances of the provincial building and of the municipal hall where the
property is located. The notice shall state the following: (1) the number of the
(a) The owner's duplicate of the certificate of title;
certificate of title, (2) the name of the registered owner, (3) the names of the
interested parties appearing in the reconstituted certificate of title, (4) the location
(b) The co-owner's, mortgagee's or lessee's duplicate of the of the property, and (5) the date on which all persons having an interest in the
certificate of title; property, must appear and file such claims as they may have.
(c) A certified copy of the certificate of title, previously issued For petitions based on sources enumerated in Sections 2(c), 2(d), 2(e), 2(f), 3(c),
by the register of deeds or by a legal custodian thereof; 3(d), 3(e) and 3(f), Section 13 adds another requirement: that the notice be
mailed to occupants, owners of adjoining lots, and all other persons who may
(d) The deed of transfer or other document on file in the have an interest in the property. To repeat, mailing the notice is not required for a
registry of deeds, containing the description of the property, or petition based on Sections 2(a), 2(b), 3(a), 3(b) and 4(a), as in the present case.
an authenticated copy thereof, showing that its original had
been registered, and pursuant to which the lost or destroyed xxxx
transfer certificate of title was issued;
[T]here is no question that in [petitions for] reconstitution involving
(e) A document, on file in the registry of deeds, by which the Sections 12 and 13 of RA 26], notices to adjoining owners and to the actual
property the description of which is given in said documents, occupants of the land are mandatory and jurisdictional. But in petitions for
is mortgaged, leased or encumbered, or an authenticated reconstitution falling under Sections 9 and 10 of RA 26 where, as in the present
copy of said document showing that its original had been case, the source is the owner's duplicate copy, notices to adjoining owners and
registered; and to actual occupants of the land are not required. When the law is clear, the
mandate of the courts is simply to apply it, not to interpret or to speculate on it.
(f) Any other document[] which, in the judgment of the court, is
sufficient and proper basis for reconstituting the lost or In sum, RA 26 separates petitions for reconstitution of lost or destroyed
destroyed certificate of title." x x x certificates of title into two main groups with two different requirements and
procedures. Sources enumerated in Sections 2(a), 2(b), 3(a), 3(b), and 4(a) of
In the present case, the source of the Petition for the reconstitution of title was RA 26 are lumped under one group (Group A); and sources enumerated in
petitioner's duplicate copies of the two TCTs mentioned in Section 3(a). Clearly, Sections 2(c), 2(d), 2(e), 2(f), 3(c), 3(d), 3(e), and 3(f) are placed together under
the Petition is governed, not by Sections 12 and 13, but by Section 10 of RA 26. another group (Group B). For Group A, the requirements for judicial
We quote said Section 10 in full: reconstitution are set forth in Section 10 in relation to Section 9 of RA 26; while
for Group B, the requirements are in Sections 12 and 13 of the same
law.19 (Italicization in the original; boldfacing supplied)
"SEC. 10. Nothing hereinabove provided shall prevent any registered
owner or person in interest from filing the petition mentioned in Section
Five of this Act directly with the proper Court of First Instance, based on However, contrary to respondents' claim, Puzon finds no application here. No report from
sources enumerated in Section 2(a), 2(b), 3(a), 3(b), and/or 4(a) of this a pertinent government agency challenging the authenticity of Puzon's duplicate
Act: Provided, however, That the Court shall cause a notice of the certificates of title was presented in Puzon. Thus, when Branch 80 granted reconstitution,
petition, before hearing and granting the same, to be published in the Puzon's duplicate transfer certificates of title remained unchallenged. 20
manner stated in Section Nine hereof: And provided, further, That
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Land Titles and Deeds (Finals) 2017
In contrast, the trial court in the present case was misled into treating LRC Case No. Q-96- True, petitioner submitted the Second Report after the period to appeal, or seek relief
8296 as having been filed under Section 3(a) based on Marina's purported duplicate title. against, the 28 October 1996 Order had lapsed. However, this is no bar for the trial court
Thus, the trial court followed Section 1021 in connection with Section 922 of RA 26 to to consider the Second Report. Petitioner was not at fault when it did not submit its Report
publicize LRC Case No. Q-96-8296. Relying on the First Report's finding that TCT No. before the trial court resolved LRC Case No. Q-96-8296. Petitioner explained that
252708 "do[es] not appear to overlap previously plotted/decreed properties in the area," respondents failed to submit the documents petitioner had requested in its letter of 6
the trial court granted reconstitution. However, petitioner later informed the trial court of the August 1996. But more than this, courts have inherent power to
First Report's spuriousness, the serious doubts on TCT No. 252708's authenticity, and the
existence of two other titles that overlapped Lot No. 1. After hearing the parties, the trial correct fatal infirmities in its proceedings, 26 especially if, as here, the flaw was intentionally
court dismissed LRC Case No. Q-96-8296 for lack of jurisdiction as all interested parties brought about by a party who employed deceit in misleading the trial court. To hold
were not actually notified of the petition as required under Section 13 in relation to Section otherwise would render courts helpless in maintaining the integrity of its proceedings and
12 of RA 26. correspondingly embolden parties to make a mockery of judicial rules. The trial court
merely exercised such inherent power in the higher interest of justice. 27
We hold that the trial court did not commit grave abuse of discretion.
The issuance by the Register of Deeds of Quezon City of TCT No. RT-115027 does not
We were faced with substantially the same situation in Director of Lands v. Court erase the doubts the Second Report raises on the authenticity of TCT No. 252708. Nor
of Appeals.23 In that case, the petition for reconstitution, as in the present case, was filed does it negate the existence of TCT Nos. 187040 and 187042. Paragraph 12 of Circular
under Section 3(a) of RA 26 based on an alleged owner's duplicate certificate of title. No. 35 requires that the Register of Deeds shall submit "written findings" on the status of
However, the Director of Lands, in an adverse Report, challenged the authenticity of the the title sought to be reconstituted.28 No such "written findings" exist in the records of this
purported duplicate certificate of title. The trial court denied reconstitution but the Court of case. What respondents submitted was a Certification dated 14 December 1994 that the
Appeals reversed the trial court's ruling. Upon further review, we reversed the Court of original of TCT No. 252708 was among those destroyed in the 1988 fire. This falls short of
Appeals and dismissed the reconstitution petition. We held that with the Director of Lands' what paragraph 12 of Circular 35 requires.
Report, the petition for reconstitution "falls squarely" under Section 3(f) of RA 26, thus:
Consequently, it is Section 13 in relation to Section 12 of RA 26 which applies to LRC
In the instant case, the change in the number of the certificate of title sought to Case No. Q-96-8296. Hence, in addition to its posting and publication, the notice of
be reconstituted from T-12/79 to TCT No. 42449 rendered at once the hearing of LRC Case No. Q-96-8296 should also have been served through mail on the
authenticity or genuineness of respondent's certificate of title under suspicion or owners of the adjoining properties and all persons who may have any interest in the
cloud of doubt. And since respondent alleges that the technical descriptions property.29 The records show that neither Lot No. 1's adjoining owners 30 nor the other
under both certificates of title are identical and the same, x x x, We hold that the interested parties, namely, Mario Uy and Maria Corazon Uy-Zalamea ("Uy
instant petition for judicial reconstitution falls squarely under Section 3(f),
Republic Act No. 26, because the Director of Lands claims that the and Zalamea"), in whose names TCT Nos. 187042 and 187040 were issued, were notified
respondent's duplicate of the Certificate of Title No. T-12/79 or TCT No. of respondents' petition in LRC Case No. Q-96-8296.31
42449 are [sic] both fake and fictitious.24 (Emphasis supplied)
Employees Union vs. Juan Perez, L-22584 and L-23083, May 30, 1972, 45 In MWSS v. Sison, also involving a motion to set aside a "final" reconstitution order for
SCRA 179, 187). Further, absent jurisdiction the court cannot pass upon the non-compliance with Section 13 of RA 26, we laid down the attributes of a void judgment
merits of the petition (Pinza vs. Aldovino, 25 SCRA 220, 224). or ruling:
In the case at bar, the jurisdiction or authority of the Court of First Instance is x x x a void judgment is not entitled to the respect accorded to a valid judgment,
conferred upon it by Republic Act 26 entitled "An Act providing a special but may be entirely disregarded or declared inoperative by any tribunal in which
procedure for the reconstitution of Torrens Certificates of Title lost or destroyed," effect is sought to be given to it. It is attended by none of the consequences of a
approved on September 25, 1946. The Act specifically provides the special valid adjudication. It has no legal or binding effect or efficacy for any purpose or
requirements and mode of procedure that must be followed before the court can at any place. It cannot affect, impair or create rights. It is not entitled to
act on the petition and grant to the petitioner the remedy sought for. These enforcement and is, ordinarily, no protection to those who seek to enforce. All
requirements and procedure are mandatory. The petition for reconstitution proceedings founded on the void judgment are themselves regarded as invalid.
must allege the jurisdictional facts; the notice of hearing must also be In other words, a void judgment is regarded as a nullity, and the situation is the
published and posted in particular places and the same sent to specified same as it would be if there were no judgment. It, accordingly, leaves the parties
persons. Specifically, the requirements and procedure are set forth in detail litigants in the same position they were in before the trial. 37
under Sections 12 and 13 of the Act [.] x x x x32(Emphasis supplied)
Guided by this rule, we had set aside so-called "final" reconstitution Orders for being void
On the particular requirement of service of notice to all interested parties, we held in the for non-compliance with Section 13 of RA 26 where the Orders were challenged either
earlier case of Manila Railroad Company v. Moya: through a motion filed in the trial court issuing the reconstitution order 38 or through a
petition under Rule 47 of the Rules of Court filed with the Court of Appeals. 39Here,
It is clear from section 13 of Republic Act No. 26 that notice by publication is not petitioner availed of the former remedy.40
sufficient under the circumstances. Notice must be actually sent or delivered
to parties affected by the petition for reconstitution. The order of However, a modification in the disposition of LRC Case No. Q-96-8296 is in order. In its 17
reconstitution, therefore, having been issued without compliance with the July 1998 Resolution, the trial court set aside the 28 October 1996 and dismissed LRC
said requirement, has never become final as it was null and void. The Case No. Q-96-8296. At that time, however, the Register of Deeds, Quezon City had
Manila Railroad cannot then complain that the motion to set aside was filed already issued reconstituted TCT No. RT-115027. That title must similarly be set aside,
beyond the reglementary period. 33 (Emphasis supplied) emanating as it did from a void ruling.
We have since reiterated this ruling in Ortigas & Company Limited Partnership v. A Final Word
Velasco34 and Puzon.
Reconstitution proceedings under RA 26 has for their purpose the restoration in the
Respondents erroneously invoke Calalang as authority for their claim that it is only the original form and condition of a lost or destroyed instrument attesting the title of a person
publication and posting of the notice of hearing which are mandatory. The question of to a piece of land.41 Thus, reconstitution must be granted only upon clear proof that the title
whether the actual notice requirement in Section 13 in relation to Section 12 of RA 26 is sought to be restored was indeed issued to the petitioner. Strict observance of this rule is
mandatory and jurisdictional was not the main issue in that case it was whether the vital to prevent parties from exploiting reconstitution proceedings as a quick but illegal way
petitioners were bound by our ruling in De la Cruz v. De la Cruz,35 affirming the validity of to obtain Torrens certificates of titles over parcels of land which turn out to be already
a Torrens certificate of title issued to one who had obtained the property covered by the covered by existing titles.42 The social and economic costs of such modus operandi cannot
title through a conveyance duly recorded in the Register of Deeds of Quezon City and who be underestimated.43 Asweobserved in Director of Lands v. Court of Appeals:
had the title subsequently reconstituted. We answered in the affirmative and dismissed the
petitions principally on the ground of res judicata.36 Notably, we found in Calalang that The efficacy and integrity of the Torrens System must be protected and
the predecessor-in-interest of the petitioners did not own the disputed property, thus the preserved to ensure the stability and security of land titles for otherwise land
latter could not claim any better right than the former. ownership in the country would be rendered erratic and restless and can certainly
be a potent and veritable cause of social unrest and agrarian agitation. x x x x
For non-compliance with the actual notice requirement in Section 13 in relation to Section The real purpose of the Torrens System which is to quiet title to the land must be
12 of RA 26, the trial court did not acquire jurisdiction over LRC Case No. Q-96-8296. The upheld and defended, and once a title is registered, the owner may rest secure,
proceedings in that case were thus a nullity and the 28 October 1996 Order was void. without the necessity of waiting in the portals of the court or sitting in the mirador
de su casa to avoid the possibility of losing his land. 44
Void Rulings Subject to Challenge at any Time
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
WHEREFORE, we GRANT the petition. We SET ASIDE the Decision dated 31 August HEIRS OF GREGORIO AND MARY G.R. No. 149122
2000 and the Resolution dated 17 November 2000 of the Court of Appeals. We ENTER a VENTURANZA, Present:
new judgment declaring the reconstitution proceedings in LRC Case No. Q-96-
8296 VOID for lack of jurisdiction. Accordingly, we declare VOID the Order dated 28 Petitioners,
October 1996 of the Regional Trial Court of Quezon City, Branch 225 and the reconstituted
Transfer Certificate of Title No. RT-115027 (252708). We direct the Register of Deeds of
PUNO, C.J., Chairperson,
Quezon City to CANCEL Transfer Certificate of Title No. RT-115027 (252708).
SANDOVAL-GUTIERREZ,
Let a copy of this ruling be served on the Register of Deeds, Quezon City.
CORONA,
SO ORDERED.
AZCUNA, and
Promulgated:
x------------------------------------------------------------------------------------x
DECISION
GARCIA, J.:
By this petition for review under Rule 45 of the Rules of Court, petitioners seek the reversal
of the decision[1] dated January 31, 2001 of the Court of Appeals (CA) in CA-G.R. CV No.
38630, as reiterated in its resolution of March 22, 2001, denying the petitioners motion for
reconsideration. The assailed CA decision affirmed [and dismissed the appeal taken by the
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
petitioners from] an earlier decision of the Regional Trial Court (RTC) of Iriga City, Branch Meanwhile, it appears that in the course of the parties negotiation for the sale of the
37, which ordered the cancellation of petitioners Transfer Certificate of Title (TCT) No. property covered by the title in question, the governments negotiation committee assigned
2574 and the reversion of the land covered thereby to the mass of the public domain, in a a deputy clerk of the Land Registration Commission (LRC) to verify the true copies of TCT
suit thereat commenced for the purpose by respondent Republic of the Philippines, No. 2574 in the name of Gregorio Venturanza.
The petition traces its beginning from a complaint filed by the Republic of the Philippines, Plan RS-383-D containing a combined area of 23,944,635 square meters or 2,394
through the Office of the Solicitor General (OSG), in the RTC of Iriga City, thereat hectares, situated in the municipality of Buhi, Camarines Sur.
docketed as Civil Case No. IR-122 and raffled to Branch 37 thereof, against the
In turn, TCT No. RT-40 (140) appears to have been reconstituted from TCT No. 140 which
Venturanza couple for the cancellation of their TCT No. 2574, covering a vast track of land
was issued to one Sebastian Moll on June 7, 1928.
with a combined area of 23,944, 635 square meters located at Buhi, Camarines Sur.
TCT No. 140, on the other hand, appears to be a transfer from Land Registration Case
Reviewed, the records unfold the following facts and antecedents:
(LRC) No. 3480 issued to one Casimiro Natividad.
The title in question TCT No. 2574 of the Registry of Deeds of Camarines Sur was issued
Upon further investigation, it was discovered that the land subject of LRC No. 3480,
sometime in 1959 in the name of Gregorio Venturanza, married to Mary Edwards-
originally registered on July 28, 1911, covered a parcel of land consisting of only 451
Venturanza. The memorandum of registration shows that TCT No. 2574 was derived from
square meters and situated in Tigaon, Camarines Sur.
TCT No. RT-40 (140), which is a reconstituted title issued to one Florencio Mora who
sold the property therein described to Gregorio Venturanza in 1956 for P107,730.00. The In the report submitted by the LRC deputy clerk, the latter made a finding that the
same memorandum of registration, however, does not show when the land covered by Venturanzas TCT No. 2574, a direct transfer from TCT No. RT-40 (140) which was, in turn,
TCT No. 2574 was originally registered and the other data were merely noted as (NA). derived from TCT No. 140, covers only a parcel of land with an area of 451 square meters
and not 23,944,635 square meters or 2,394 hectares which practically comprise the
In 1964, GregorioVenturanza and the then Abaca Development Board entered into an
entire Municipality of Buhi.
agreement for purchase and sale of the property covered by TCT No. 2574, whereby the
former agreed to convey the property to the latter, subject to the approval of the document
of sale by the concerned government office. The final sale, however, did not materialize.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Such was the state of things when, sometime in 1965, in the then Court of First Instance Therefrom, the Venturanzas went on appeal to the CA in CA-G.R. CV No. 38630, arguing
(now RTC) of Camarines Sur, the Republic of the Philippines, through the OSG, filed a that Moras reconstituted title from where their TCT No. 2574 was derived is already
complaint for the Cancellation of Transfer Certificate of Title No. 2574 and the Reversion of indefeasible on the ground that upon the lapse of one (1) year, the decision granting
the Land Described Therein to the Republic of the Philippines. Thereat originally docketed reconstitution of Moras title becomes final. The Venturanzas also claimed that they are
as Civil Case No. 5973, the complaint eventually became Civil Case No. IR-122 which was protected by law as buyers in good faith. Lastly, they argued that the Republics action for
raffled to Branch 37 of the court. the cancellation of TCT No. 2574 and the reversion of the land described therein to the
mass of public domain was already barred by the decision of the CA in CA-G.R. No.
On April 8, 1992, the trial court came out with its decision[2] ordering the annulment and
20681-R, entitled, Florencio Mora v. Venancio Infante, et al., which granted the petition for
cancellation of the Venturanzas TCT No. 2574 and the reversion of the land covered
reconstitution of Moras TCT No. RT-40 (140).
thereby to the mass of the public domain. Dispositively, the decision reads:
WHEREFORE, premises considered, judgment is rendered in In the herein assailed decision dated January 31, 2001, the CA affirmed that of the trial
favor of the Republic of the Philippines and against the defendants
ordering the annulment of TCT No. 2574 in the name of Gregorio court. With their motion for reconsideration having been denied by the CA in its
Venturanza, ordering the Register of Deeds of Camarines Sur to cancel resolution[3] of May 22, 2001, petitioners as successors-in-interest of the spouses
said title, and reverting the land covered by the questioned title, except
that which may have already been alienated by the proper authorities Venturanza are now with this Court via the present recourse raising the same issues
and lawfully passed to private ownership, to the public domain of the
Republic of the Philippines, with costs against the defendants. already passed upon by the appellate court.
We DENY.
SO ORDERED.
Petitioners maintain that under Section 112 of Act No. 496 (Land Registration Act), Moras
In resolving the suit in favor of the Republic, the trial court principally anchored its reconstituted TCT No. RT-40 (140) is already indefeasible the same having attained finality
judgment on the ground that the reconstituted title issued in the name of Florencio Mora one (1) year after the CA granted its reconstitution in CA-G.R. No. 20681-R. Citing the
could have been fraudulently secured, hence, does not legally exist. The court further ruled second paragraph of Section 31 of P.D. No. 1529[4] which reads:
that since the reconstituted title issued to Florencio Mora is a nullity, then the order for its
reconstitution did not attain finality and therefore may be attacked anytime. The decree of registration shall bind the land and quiet title thereto,
subject only to such exceptions or liens as may be provided by law. It
shall be conclusive upon and against all persons, including the National
Government and all branches thereof, whether mentioned by name in
the application or notice, the same being included in the general
description to all whom it may concern,
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
xxx the Land Registration Act is not applicable considering that the land
covered by TCT No. 2574 had never been within the operation of the
Land Registration Act because of the irregularities attending the The stench of anomaly became at once pervading
issuance of the reconstituted title. As found by the trial court: when we consider the evidence submitted by the
plaintiff. The land practically covers
TCT No. RT-40 (140) supposedly reconstituted from the Municipality of Buhi and are being claimed and
TCT no. 140 in the name of Florencio Mora consists possessed by claimants, who appeared as
of 2,394 hectares supposedly situated in Buhi, intervenors in this case. The Venturanzas never
Camarines Sur. It appears from the survey plan that materially and physically occupied the property
the land was surveyed only in 11 days, which because there are actual occupants and
according to Engr. Antonio Rodriguez was quite possessors. The Venturanzas only asserted
impossible considering the rugged terrain and the ownership over the property in papers but not in
mountainous features of the area. Moreover, it physical possession.[5]
covers timberland.
Significantly, from the exhibits presented by the As a necessary consequence, no court could have ever acquired jurisdiction to order the
plaintiff it can be seen that the resurvey plan (Exh.
A) shows that the survey of Lot Nos. 1, 2 and 3 was reconstitution of Moras TCT No. RT-40 (140) over the land which has never been originally
based on TCT No. 140 and it covered an area of
registered. As aptly pointed out by the trial court:
23,944,635 square meters and appeared to have
been surveyed on January 20, to January 31, 1953
or a period of 11 days. Exh. B shows that the area
supposedly covered by TCT 2574 is within the
timberland, Project 12, Block B, L.C. 646 and The evidence shows that TCT No. 2574,
Project 19, Block ALC 761, Exh. C, the official map the title in question, derived its existence from RT-40
of Legaspi City shows that the land covered by TCT (140) in the name of Florencio Mora which was a
140, which was issued on the basis of the resurvey reconstituted title based on TCT No. 140 allegedly
(Exh. A) is a land situated in Tigaon, Camarines Sur, obtained by Florencio Mora during the Japanese
while the land covered by TCT No. 40 (140) is a vast occupation. The records of the Register of Deeds of
tract of land in Buhi, Camarines Sur; that it further Camarines Sur, however, do not show how the land
appears that the lots covered by TCT No. 40 (140) covered by TCT No. 140 supposedly in the name of
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Mora could have acquired ownership over the subject parcels of land and validly transfer
Corollarily, petitioners argument that the Republics action for the cancellation of TCT No.
that ownership to the petitioners was for Mora to apply for their registration in his own
2574 and the reversion of the land covered thereby to the State is barred by the decision
name.
of the CA in CA-G.R. No. 20681-R has no leg to stand on.
What makes petitioners cause doubly undeserving of merit is the finding of the two courts
Aside from the fact that no court could have ever acquired jurisdiction to order the
below that the land subject matter of this case is part timberland, [7] a finding not even once
reconstitution of Moras title over the property which has never been originally registered,
disputed by petitioners. It is, thus, safe to conclude that the land subject of TCT No. 2574
the judgment in CA-G.R. No. 20681-R did not operate as res judicata which would bar the
could not have been registered in the name of petitioners or their predecessors-in-interest
Republics action because there was no identity of cause of action between CA-G.R. No.
for the simple reason that under the Constitution, timberlands, which are part of the public
20681-R and the instant case.
domain, cannot be alienated.[8] A certificate of title covering inalienable lands of the public
The issue in CA-G.R. No. 20681-R was whether or not Moras domain is void and can be cancelled in whosever hand said title may be found. [9] Thus, we
evidence in Special Proceedings No. 674 and the procedures adopted by have ruled that a certificate of title is void when it covers property of the public domain
him for the reconstitution of certificate of title alleged to have been lost or destroyed were classified as forest or timber and mineral lands. And any title issued on non-disposable
in conformity with the provisions of Republic Act No. 26. The questions of ownership and lands even if in the hands of alleged innocent purchaser for value, shall be cancelled. [10]
whether or not the property or portion thereof was registrable, being a timberland, were
All told, the Court finds no reversible error in the assailed decision of the CA, affirming that
never put at issue in CA-G.R. No. 20681-R. Neither the non-
of the trial court.
existence of the original title from which Moras TCT No. RT-40 (140) and petitioners TCT
WHEREFORE, the instant petition is DENIED and the assailed decision of the CA
No. 2574 were derived, nor the non-registrability of the timberland included in the area in
is AFFIRMED.
question which constitute Republics cause of action against the herein petitioners, were
ever raised, much less, decided by the CA in CA-G.R. No. 20681-R. No pronouncement as to costs.
Petitioners also claim that they are protected by law considering that they were buyers in SO ORDERED.
good faith.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
G.R. No. 172338 December 10, 2012 included burned and lost beyond recovery when the office was razed by fire
sometime in 1976, a certification to this effect as issued by the office is hereto
REPUBLIC OF THE PHILIPPINES, Petitioner, marked as ANNEX "D";
vs.
CONCEPCION LORENZO, ORLANDO FONTANILLA, SAMUEL FONTANILLA, JULIET 8. That for taxation purposes, the lot as covered by OCT NO. 3980, still in the
FONTANILLA, ELIZABETH FONTANILLA, ROSELA FONTANILLA, RENATO name of Antonia Pascua for Lot 18, Cad. 210, with an assessed value of
FONTANILLA AND EVELYN FONTANILLA, Respondents. P16,920.00, x x x;
DECISION 9. That no mortgagees and/or lessees co-owners copy to the subject OCT NO.
3980 was ever issued, and likewise no related documents affecting the land
LEONARDO-DE CASTRO, J.: covered thereby is presented and pending for registration in favor of any person
whomsoever, and henceforth, it is free from lien and encumbrance;
Before the Court is a petition for review under Rule 45 of the 1997 Rules of Civil Procedure
assailing the Decision 1 dated April 17, 2006 of the Court of Appeals in CA-G.R. CV No. xxxx
80132, entitled "Concepcion Lorenzo, Orlando Fontanilla, Samuel Fontanilla, Juliet
Fontanilla, Elizabeth Fontanilla. RosPln Fontanilla, Renato Fontanilla and Evelyn 11. That in support for the reconstitution of [OCT] No. 3980, the following
Fontanilla v. Republic of the Philippines." Said Court of Appeals Decision affirmed the documents which may constitute as source or basis for the purpose are herewith
Decision2 dated August 26, 2003 in LRC Case No. 24-2692 of Branch 24, Regional Trial submitted:
Court (RTC), Echague, Isabela.
(a) S[E]PIA PLAN with Blue Prints x x x;
The genesis of the present case can be traced back to the filing before the trial court on
February 11, 2002 of a Petition3 for the reconstitution of Original Certificate of Title (OCT) (b) Certified technical description of Lot 18, Cad. 210 x x x;
No. 3980 covering a parcel of land measuring 811 square meters, situated in Echague,
Isabela.
(c) Certification by LRA as to the non-availability of a copy of DECREE
NO. 650254 x x x[.]4
In seeking the reconstitution of OCT No. 3980, respondents averred before the trial court:
During the trial, the testimony of co-respondent Evelyn Fontanilla- Gozum was offered in
3. That during the lifetime of Pedro Fontanilla and herein petitioner Concepcion order to prove the above-mentioned allegations in the petition. In her testimony, she
Lorenzo, husband and wife, respectively, they acquired a parcel of residential declared that she is the daughter of the late Pedro Fontanilla and co-respondent
land, x x x; Concepcion Lorenzo who, during their marriage, acquired a parcel of land covered and
embraced by OCT No. 3890 from her grandmother Antonia Pascua as evidenced by a
4. That subject parcel of land is identical to Lot 18 of Echague Cadastre 210, Deed of Sale. She also averred that the owners duplicate of the said Torrens certificate of
covered by and embraced under ORIGINAL CERTIFICATE OF TITLE NO. 3980 title was later discovered to have been eaten by termites and that the original copy of the
of the Land Records of Isabela, in the name of Antonia Pascua as her said Torrens certificate of title on file with the Register of Deeds of Isabela was certified to
paraphernal property and being the mother of Pedro Fontanilla; be burned and lost beyond recovery when the office was razed by fire of unknown origin
on December 4, 1976 as certified to by the Register of Deeds. Since both the original copy
5. That because of the death of Pedro Fontanilla the lot as covered by the on file and the owners duplicate copy are non-existent, she and her co-heirs, who are also
co-respondents in this case, instituted the petition for reconstitution of lost or destroyed
aforesaid title was settled and adjudicated among the herein petitioners, x x x;
Torrens certificate of title.5
6. That the OWNERS DUPLICATE COPY OF OCT NO. 3980 was handed and
delivered unto the spouses Pedro Fontanilla and Concepcion Lorenzo which they In its Decision dated August 26, 2003, the trial court granted respondents petition and
directed the Register of Deeds of Isabela to reconstitute OCT No. 3980 in the name of
have been keeping only to find out thereafter that it was eaten by white ants
(Anay); Antonia Pascua on the basis of the deed of sale, the technical description and the sketch
plans, and to issue another owners duplicate copy of the said Torrens certificate of title.
The dispositive portion of the said ruling states:
7. That the original and office file copy of said OCT NO. 3980 kept and to be on
file in the Registry of Deeds of Isabela is not now available, utmost same was
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
WHEREFORE, premises considered, judgment is hereby rendered ordering the Register of OCT No. 3980. Petitioner likewise maintains that the findings of fact of the Court of
of Deeds of Isabela to reconstitute the original copy of OCT No. 3980 in the name of Appeals are not supported by the evidence on record. Lastly, petitioner insists that,
Antonia Pascua, on the basis of the deed of sale, the technical description and the sketch contrary to respondents assertion, the government of the Republic of the Philippines is not
plans, and to issue another Owners Duplicate of the said title after payment of the estopped by the mistakes, negligence or omission of its agents.
necessary legal fees.
For their part, respondents maintain that they have complied with Section 2 of Republic Act
Furnish copy of this Order to the Land Registration Authority, The Register of Deeds of No. 26 considering that there was no opposition from the Office of the Solicitor General
Isabela and the Office of the Solicitor General.6 (OSG); that the OSG is guilty of estoppel; that there was a valid basis for reconstitution of
OCT No. 3980; that there was compliance with jurisdictional requirements; that both the
Petitioner Republic of the Philippines, through the Office of the Solicitor General, appealed original file copy and the owners copy of the subject OCT for reconstitution were lost or
the ruling to the Court of Appeals arguing that the trial court erred in granting respondents destroyed beyond discovery; and that questions of fact are not subject to review by this
petition for reconstitution of Torrens title since they failed to present substantial proof that Court.
the purported original certificate of title was valid and existing at the time of its alleged loss
or destruction, and that they failed to present sufficient basis or source for reconstitution. In essence, the focal issue of the present case is whether or not the reconstitution of OCT
No. 3980 was in accordance with the pertinent law and jurisprudence on the matter.
The Court of Appeals dismissed petitioners appeal in the assailed Decision dated April 17,
2006, the dispositive portion of which states: The petition is impressed with merit.
WHEREFORE, premises considered, the appeal is hereby DISMISSED for lack of merit.7 The relevant law that governs the reconstitution of a lost or destroyed Torrens certificate of
title is Republic Act No. 26. Section 2 of said statute enumerates the following as valid
Hence, the petitioner sought relief before this Court and relied on the following grounds to sources for judicial reconstitution of title:
support its petition:
SECTION 2. Original certificates of title shall be reconstituted from such of the sources
hereunder enumerated as may be available, in the following order:
I
THE COURT OF APPEALS ERRED IN AFFIRMING THE TRIAL COURTS (a) The owners duplicate of the certificate of title;
ORDER GRANTING RECONSTITUTION OF ORIGINAL CERTIFICATE OF
TITLE NO. 3980. (b) The co-owners, mortgagees, or lessees duplicate of the certificate of title;
II (c) A certified copy of the certificate of title, previously issued by the register of
deeds or by a legal custodian thereof;
THE COURT OF APPEALS ERRED IN ITS APPLICATION OF PARAGRAPH F,
SECTION 2 OF REPUBLIC ACT NO. 26.8 (d) An authenticated copy of the decree of registration or patent, as the case may
be, pursuant to which the original certificate of title was issued;
On the other hand, respondents put forward the following issues for consideration:
(e) A document, on file in the Registry of Deeds, by which the property, the
description of which is given in said document, is mortgaged, leased or
(a) HAS THERE BEEN SUFFICIENT COMPLIANCE OF ACT 26,
REQUIREMENTS RECONSTITUTING OCT NO. 3890 AND ISSUANCE OF encumbered, or an authenticated copy of said document showing that its original
had been registered; and
ANOTHER OWNERS DUPLICATE COPY?
(f) Any other document which, in the judgment of the court, is sufficient and
(b) DID THE HONORABLE COURT OF APPEALS CORRECTLY SUSTAIN THE
RENDERED DECISION OF THE COURT OF ORIGIN?9 proper basis for reconstituting the lost or destroyed certificate of title.
Petitioner argues that the alleged loss or destruction of the owners duplicate copy of OCT As borne out by the records of this case, respondents were unable to present any of the
documents mentioned in paragraphs (a) to (e) above. Thus, the only documentary
No. 3980 has no evidentiary basis and that there is no sufficient basis for the reconstitution
evidence the respondents were able to present as possible sources for the reconstitution
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
of OCT No. 3980 are those that they believed to fall under the class of "any other Furthermore, in a more recent case, this Court enumerated what should be shown before
document" described in paragraph (f). an order for reconstitution can validly issue, namely: (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
In the assailed April 17, 2006 Decision of the Court of Appeals, the appellate court affirmed
the trial courts ruling by granting respondents petition for reconstitution of OCT No. 3980 the registered owner of the property or had an interest therein; (d) that the certificate of title
merely on the bases of a purported deed of sale,10 sketch plan,11 and technical was in force at the time it was lost or destroyed; and (e) that the description, area and
description.12 The relevant portion of said Decision reads: boundaries of the property are substantially the same and those contained in the lost or
destroyed certificate of title.16
We also find insufficient the index of decree showing that Decree No. 365835 was issued BARSTOWE PHILIPPINES G.R. No. 133110
for Lot No. 1499, as a basis for reconstitution. We noticed that the name of the applicant CORPORATION,
as well as the date of the issuance of such decree was illegible. While Decree No. 365835 Petitioner,
existed in the Record Book of Cadastral Lots in the Land Registration Authority as stated
in the Report submitted by it, however, the same report did not state the number of the Present:
original certificate of title, which is not sufficient evidence in support of the petition for
reconstitution. The deed of extrajudicial declaration of heirs with sale executed by
Aguinaldo and Restituto Tumulak Perez and respondent on February 12, 1979 did not also
YNARES-SANTIAGO,*J.
mention the number of the original certificate of title but only Tax Declaration No. 00393.
Chairperson,
As we held in Tahanan Development Corp. v. Court of Appeals, the absence of any
AUSTRIA-MARTINEZ,
document, private or official, mentioning the number of the certificate of title and the
date when the certificate of title was issued, does not warrant the granting of such
petition.21 (Citation omitted, emphasis supplied.) CALLEJO, SR.,**
- versus-
CHICO-NAZARIO, and
Lastly, on the peripheral issue of whether or not the OSG should be faulted for not filing an
opposition to respondents petition for reconstitution before the trial court, we rule that such
an apparent oversight has no bearing on the validity of the appeal which the OSG filed NACHURA, JJ.
before the Court of Appeals. This Court has reiterated time and again that the absence of
opposition from government agencies is of no controlling significance because the State
cannot be estopped by the omission, mistake or error of its officials or agents. 22 Neither is
the Republic barred from assailing the decision granting the petition for reconstitution if, on
the basis of the law and the evidence on record, such petition has no merit. 23
Promulgated:
WHEREFORE, premises considered, the petition is GRANTED. The Decision dated April REPUBLIC OF THE PHILIPPINES,
17, 2006 of the Court of Appeals in CA-G.R. CV No. 80132 and the August 26, 2003
Decision of the Regional Trial Court, Branch 24 of Echague, Isabela are Respondent.
hereby REVERSED and SET ASIDE. The petition for reconstitution is DENIED. March 28, 2007
SO ORDERED. x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x
DECISION
CHICO-NAZARIO, J.:
Before this Court is a Petition for Review on Certiorari[1] under Rule 45 of the
Rules of Court seeking the reversal and setting aside the Decision, [2] dated 8 August 1997,
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
and Resolution,[3] dated 18 March 1998, of the Court of Appeals in CA-G.R. CV No. 47522, of the Quezon City Register of Deeds on 11 June 1988 and destroyed many certificates of
[4]
which in turn, reversed and set aside the Decision, dated 22 December 1992, of
title kept therein, Antonio sought the administrative reconstitution of the original copies and
the Quezon City Regional Trial Court (RTC), Branch 80 in Civil Case No. Q-92-11806.
owners duplicate copies of TCTs No. 200629 and 200630 with the Land Registration
Antecedent Facts Authority (LRA). On 12 December 1990, the LRA issued TCTs No. RT-23687 and RT-
This case involves the conflicting titles to the same parcels of land (subject lots) 23688 (reconstituting TCTs No. 200629 and 200630, respectively), which were transmitted
of petitioner Barstowe Philippines Corporation (BPC) and the respondent Republic of to the Quezon City Register of Deeds and signed by Deputy Register of
the Philippines (Republic). The subject lots have a total area of 111,447 square meters, Deeds Edgardo Castro on 19 February 1991. Also on 19 February 1991, TCTs No. RT-
and are situated along the northeastern perimeter boundary of the National Government 23687 and RT-23688 were cancelled and in lieu thereof, TCTs No. 30829, 30830, 30831,
Center in Payatas, Quezon City. and 30832 in the name of BPC were issued. BPC then acquired from the Housing and
BPC traces its titles to the subject lots back to Servando Accibal (Servando) who Land Use Regulatory Board (HLURB) a permit to develop the subject lots into a residential
was supposedly issued on 24 July 1974, at 3:20 p.m., Transfer Certificates of Title (TCTs) subdivision. Subsequently, BPC entered into Joint Venture Agreements with other
No. 200629 and 200630 over the subject lots. TCTsNo. 200629 and 200630 were corporations for the development of the subject lots into a subdivision called Parthenon
purportedly signed by Nestor N. Pena, Deputy Register of Deeds of Quezon City. On 10 Hills.
June 1988, Servando executed a Deed of Absolute Sale of the subject lots to his son
Antonio Accibal (Antonio), with the concurrence of his other heirs. Despite his prior sale of Meanwhile, according to the Republic, prior to 14 November 1979, the subject lots were
owned by First Philippine Holdings Corporation (FPHC). As evidence of its title to the
the subject lots to Antonio, Servando, by virtue of a Deed of Conveyance, dated 8
subject lots, FPHC was issued TCT No. 257672, on an undetermined date, and TCT
February 1989, transferred/conveyed the subject lots to BPC in exchange for subscription
No. 275201, on 20 January 1981. Pursuant to a Deed of Sale, dated 14 November 1979,
of 51% of the capital stock of BPC, such subscription supposedly amounting
FPHC sold one of the subject lots, covered by TCT No. 257672, to the Republic
to P6,000,000.00.[5] About a year after the death of Servando on 3 October 1989, for P2,757,360.00. Thus, on 22 January 1981, TCT No. 257672 was cancelled and TCT
particularly on 10 October 1990, Antonio executed another Deed of Conveyance of the No. 275443 was issued in place thereof in the name of the Republic. FPHC executed
subject lots in favor of BPC in exchange for subscription of 2,450 shares of its capital another Deed of Sale on 25 March 1982 in which it sold the remainder of the subject lots,
covered by TCT No. 275201, to the Republic for P9,575,920.00. On 31 May 1982, TCT
stock, with an alleged total value of P49,000,000.00.[6] Due to the fire that gutted the Office
No. 275201 was cancelled and was replaced by TCT No. 288417 issued in the name of
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Republic applied for administrative reconstitution of the same with the LRA. It was then
that the Republic came to know that another party had applied for reconstitution
of TCTs No. 200629 and 200630 which also covered the subject lots. This prompted the On 12 October 1992, the Republic filed with the Quezon City Register of Deeds a Notice
Republic to file before the RTC on 26 March 1992 a petition for cancellation of title against of Lis Pendens requesting the recording of the pendency of Civil Case No. Q-92-11806
Antonio, Servando, and BPC, docketed as Civil Case No. Q-92-11806. on TCTs No. 30830, 30831, and 30832, all in the name of BPC.
While Civil Case No. Q-92-11806 was still pending before the RTC, there were
Counsel for Antonio and the late Servando filed two successive Motions for extension of
two intervenors.
time to file the proper pleading, dated 17 June 1992 and 1 July 1992, but despite the grant
thereof by the RTC,[7] no such responsive pleading on behalf of Antonio and the Gloria Accibal Rettoriano (Gloria) filed with the RTC a Motion for Intervention,
late Servando was ever filed. Hence, on 31 July 1992, the RTC issued an with a Complaint in Intervention, both dated 1 September 1992. Gloria alleged that she
[8]
Order declaring Antonio and the late Servando in default.
was the only child of Basilia Accibal, Servandos sister; the subject lots were inherited
In another Order,[9] also dated 31 July 1992, the RTC, upon the motion of BPC, allowed by Basilia, Servando, and their other siblings from their parents Martin
the latter to continue with the development of the subject lots. It concluded that and Mauricia Accibal; upon her mothers death, Gloria inherited and came into possession
of a portion of the subject lots with an area of about 2.5 hectares; Gloria had been
Considering the plight of [BPC] and the possible irreparable possessing, cultivating and improving her portion of the subject lots for the last 30
damage that may be caused against the residents in the surrounding
developed subdivision, even as said corporation is possessed of a years; Servando, through fraudulent means, was able to secure TCTs over all the subject
good title, the court in the exercise of its discretion grants the
motion. More importantly, consideration of equity demands that the lots, including Glorias portion therein; the inclusion of Glorias portion in
titled owner [BPC] herein must be able to exercise all its dominical
right bloosoming [sic] forth from its ownership of the land in suit. the TCTs of Servando and, later, in those of BPC, was done through fraud and gross bad
faith; and unless the TCTs of Servando and BPC are declared null and void, Gloria will be
WHEREFORE, under cool reflection and prescinding from the deprived of her property without due process and just compensation. BPC opposed
foregoing, the motion is hereby granted. [BPC] is hereby permitted and
Glorias intervention in Civil Case No. Q-92-11806 considering that she had already
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
entered into a Compromise Agreement with BPC in which she waived and renounced any
Another intervenor in Civil Case No. Q-92-11806 was EL-VI Realty and
and all claims whatsoever which she may have over the titles of BPC in consideration of Development Corporation (ERDC) which filed with the RTC a Motion for Leave to
the payment by the latter of P2,000,000.00; the RTC, Branch 76, after finding that the said Intervene, dated 1 September 1992. Subsequently, it filed an Answer in Intervention, dated
Compromise Agreement was not contrary to law, morals, good customs, public order or 15 September 1992, in which, it alleged that it acquired interest in the subject lots after
having entered into a Joint Venture Agreement dated 16 January 1992, with BPC, for the
public policy, approved the same, thus putting an end to Civil Case No. Q-91-
development of the subject lots into a residential subdivision; the action initiated by the
10933;[11] Glorias cause of action to intervene in Civil Case No. Q-92-11806 was already
Republic for the cancellation of the TCTs of BPC was already barred
barred by prior judgment in Civil Case No. Q-91-10933 and Glorias Complaint in
by laches and estoppel because of the recognition accorded upon the said TCTs by the
Intervention is tantamount to a collateral attack against a TCT. In rejecting Glorias instrumentalities of the Republic, particularly the Register of Deeds and the HLURB, on
intervention in Civil Case No. Q-92-11806, the RTC found as follows which the ERDC relied in all good faith when it entered into the Joint Venture Agreement
with BPC; the Republic is liable to ERDC for moral damages and attorneys fees; should
The motion for intervention must be denied and the complaint
in intervention therein attached must be rejected. the RTC find the TCTs of BPC infirm, rendering the Joint Venture Agreement between
For one thing, herein movant Gloria Accibal Rettoriano, was
the plaintiff in the first case (RTC Br. 76 No. Q-91-10933) and with eyes ERDC and BPC of no force and effect, then BPC should be held liable to ERDC, being an
wide open she entered into a compromise agreement with [BPC], which
was the basis of the 26 February 1992 decision rendered therein and it innocent third party, for reimbursement of all expenses incurred by the latter in the
being based on a compromise agreement, said decision became
immediately final and executory. development of the subject lots; and should the RTC find that the TCTs of BPC are
Whether or not the decision rendered in the first case was spurious, then it should be declared in bad faith when it entered into the Joint Venture
satisfied is of no moment in the present case, as
herein movant intervenor has all the remedies to protect her rights Agreement with ERDC, for which it should be liable for exemplary damages and attorneys
therein.
fees. In an Order,[13] dated 27 October 1992, the RTC granted ERDCs Motion to Intervene
For another, movant intervenor Gloria Accibal Rettoriano,
from her complaint in intervention would ask for the cancellation of the and admitted its Answer in Intervention.
titles issued to their [sic] relative Servando Accibal and those titles duly
issued and registered in the name of [BPC]. Certainly, this can not be
done, as it constitutes a collateral attack on the questioned titles which
the law and settled jurisprudence do not allow. Perforce, a separate
action against the questioned titles is the remedy available
for intervenor Gloria A. Retoriano [sic].
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
xxxx
In the same Decision, the RTC found certain irregularities in TCTs No. 200629 and 200630
in the name of Servando and that the said TCTs should be cancelled, without prejudice to Finally, we shall next discuss the claim of intervenor EL-VI
Realty and Development Corporation. A close reading from the Joint
the rights and interests of BPC. The RTC discussed the matter in this wise Venture Agreement dated January 16, 1992, shows that in case of
litigation, intervenor Realty Corporation shall have the right to suspend
all development activities and the development period of 5 years shall
automatically be suspended until such time as the said case is finally
We shall now dwell on the validity of the titles TCT Nos. settled/decided (Exh. 5 and Annex A answer in intervention pp. 109-
200629 and 200630, issued in the name of Servando Accibal on July 114). Upon the signing of the said agreement the amount
24, 1974 by the Register of Deeds of Quezon City. The LRA report of P1,500,000.00 was received by [BPC] as advance payment of the
dated 10 June 1992 (Exh. H, pp. 214-258, record) is competent proof 50-50 sharing basis in the sales proceeds. During the pre-trial
that indeed said titles must be cancelled. In short, the LRA found after conference, herein intervenor tried to enforce a supplemental
due investigation that the said titles of Servando Accibal were issued agreement dated October 15, 1992, by filing a motion for a writ of
with certain irregularities. It recommended the cancellation therefore, of preliminary injunction with prayer for the issuance of a restraining
TCT Nos. 200629 and 200630, to which the court concurs, as said order. Resolution of the same was held in abeyance to await the
report must be accorded due respect and in the absence of fraud or decision to be rendered, after [BPC] assured intervenor herein that it
irregularities that attended the investigation, which the Court finds none, will abide by and strictly comply with its commitments arising from the
the same must be persuasive, if not conclusive. Moreover, herein aforesaid agreement, after proper accounting is made
defendant Servando Accibal because of his failure to answer, despite therefore. Herein intervenor admits that another financier-developer has
extension of time given him, failed to file his answer. Upon motion of entered the area due to the delay of the project caused by the filing of
[Republics] counsel, he was declared as in default and since then, he the present case.
never asked the court to lift and set aside the default order. There is no
way, his title must be cancelled. For one thing, he was not able to
present evidence to controvert the recommendation of LRA to cancel
his titles. For another, Servando Accibal is deemed to have impliedly MORE, due to the filing of the present case,
admitted the irregularities that attended the issuance of herein intervenor was reluctant to further finance the project because of
his aforestated titles. its big exposure already made. Hence, intervenors works and other
activities in the area was suspended in accordance with their Joint
Venture Agreement.
As for the intervention of ERDC, the RTC addressed the same as follows Finally, the RTC concluded that
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
bad faith, already sold 36 of the 40 subdivision lots it earlier offered to ERDC by
accepting downpayments thereon of only 30% of the selling price. Upon further
investigation, it discovered that of the four remaining lots, two were vacant while the other
Despite the promulgation of the foregoing Decision by the RTC on 22 December
two were reserved. ERDC subsequently filed two other motions: (1) A Motion, [21] dated 29
1992, the proceedings in Q-92-11806 were still far from over; significant developments still
April 1993, to set for trial the claim of ERDC for damages. Said motion was granted, and
took place thereafter.
the RTC set the hearing on 16 September 1993, at 8:30 a.m., [22] but upon the motion of the
counsel for BPC, the hearing was reset to 7 October 1993;[23] and (2) A Motion,[24] dated 6
September 1993, for the issuance of a partial writ of execution for the undisputed amount
ERDC sought the execution of paragraph 4 of the dispositive portion of the RTC
of P18,543,000.00, representing 65% of the total claims of ERDC. Unfortunately, the
Decision dated 22 December 1992. In an Order,[17] dated 13 January 1993, the RTC
records no longer show the succeeding incidents concerning these motions.
issued a writ of execution in favor of ERDC, and a notice of levy on execution was
accordingly made on the subject lots. In a dialogue held between the counsels for BPC
and ERDC in the chamber of the RTC Judge on 26 February 1993, an amicable settlement
In a Motion for Leave to Intervene[25] dated 8 March 1993, and the attached
was reached whereby BPC agreed to settle the claim of ERDC in the form of developed
Complaint in Intervention,[26] dated 10 March 1993, Kadakilaan Estate expressed its intent
subdivision lots in Parthenon Hills, subject to proper accounting. [18] BPC offered to ERDC
to intervene in Civil Case No. Q-92-11806. It anchored its claims on the contention that the
40 developed subdivision lots in Parthenon Hills, valued at P18,543,000.00, representing
subject lots were already registered as private property under the Spanish Mortgage Law
65% of the total claims (prior to proper accounting) of ERDC, which amounted
since 18 May 1891, and under the Torrens System of Registration since 31 August 1907,
to P28,787,306.32. However, ERDC refused the offer of BPC and demanded that it be
by the predecessors-in-interest of Kadakilaan Estate. The subject lots were supposedly
paid the total amount of its claims. It also brought to the attention of the RTC that, in
included in a vast track of land covered by Titulo de la Propiedad de Terrenos No. 01-4 in
violation of their Joint Venture Agreement, BPC contracted another realty developer for the
the name of Doa Petra Rodriguez, who transferred the same to her son, Don
development of Parthenon Hills. Thus, ERDC opposed the lifting of the notice of levy on
Gonzalo Yanesa y Rodriguez. Kadakilaan Estate came into ownership and possession of
execution on the subject lots for the protection of its interests. In an Order,[19] dated 17
the vast track of land, including the subject lots, by virtue of its successive sales from Don
March 1993, the RTC found that BPC already substantially complied with the terms of its
Gonzalo Yanesa y Rodriguez to DoaLourdez Rodriguez Yanesa, and from the latter
agreement with ERDC and that the rights and interests of the latter were well-protected
to Kadakilaan Estate. Kadakilaan Estate further alleged that the Original Certificate of Title
and safeguarded. In the same Order, the RTC lifted and set aside the notice of levy on
(OCT) No. 333, from which the TCTs of both BPC and the Republic were ultimately
execution on the subject lots. However, on 20 April 1993, ERDC filed a Motion for
derived, was null and void ab initio, and that the TCTs of BPC and the Republic were
Contempt[20] against BPC and informed the RTC that BPC, fraudulently, maliciously, and in
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Land Titles and Deeds (Finals) 2017
spurious and likewise null and void ab initio, and without any probative In the meantime, on 4 January 1993, the Republic filed a Notice of Appeal[28] of
value. Kadakilaan Estate prayed for judgment declaring it the owner of the subject lots; the RTC Decision, dated 22 December 1992. The RTC, in an Order,[29] dated 16 February
directing the other parties to respect its ownership, possession, rights and interests over 1993, denied the same. It reasoned that
the subject lots; and ordering the other parties to pay just compensation, damages, and Considering these judicial dimensions and acquiescence of
the [Republic] in open court during the hearings held and during the
attorneys fees. The RTC, in an Order[27] dated 27 April 1993, denied the Motion for Leave
pre-trial conference, the court in its dispositive portion of the questioned
to Intervene and rejected the Complaint in Intervention of Kadakilaan Estate for the decision, declared it to be a judgment based on a compromise
agreement which by operation of law becomes immediately executory.
following reasons
From the foregoing RTC Order, the Republic filed with the Court of Appeals a Petition
MORE, the law and the rules as well as jurisprudence on the
matter, will only allow in the courts discretion, intervention, before or for Certiorari and Mandamus (with Urgent Prayer for Temporary Restraining Order and/or
during the trial. Certainly NOT after the trial and with more reason
intervention may no longer be allowed after the decision has been Writ of Preliminary Injunction), docketed as CA-G.R. SP No. 30647. The Republic primarily
rendered as in the present case.
questioned the denial of its Notice of Appeal by the RTC in its Order, dated 16 February
1993, on the basis that the RTC Decision of 22 December 1992 constitutes a compromise
agreement, and is immediately final and executory. The Court of Appeals issued a writ of
preliminary injunction[30] enjoining the RTC from implementing and enforcing its Order,
dated 16 February 1993, during the pendency of CA-G.R. SP No. 30647 or until otherwise
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Land Titles and Deeds (Finals) 2017
directed by the appellate court. Apparently, from the denial by the RTC of its Motion for
xxxx
Leave to Intervene and the rejection of its Complaint in Intervention in Civil Case No. Q-92-
11806, the KadakilaanEstate again filed a Motion for Leave to Intervene in CA-G.R. SP
No. 30647, which in a Resolution,[31] dated 13 September 1993, the Court of Appeals also Records readily show that due to lack of an amicable
settlement or any compromise agreement, the respondent judge
denied on the following grounds directed the parties to present their documentary exhibits so as to
facilitate the trial; no longer for the purpose of settling the
We find the stance of [Republic] and [BPC] well- case. Evidently, there was no explicit agreement nor any reciprocal
grounded. Not only is [Kadakilaan Estate] precluded by estoppel from concession between the parties with an end in view of terminating the
filing the present motion, after failing to challenge before this Court or litigation. Absence of these essential elements of a compromise
the Supreme Court the trial courts denial of subject motion for inevitably results in the absence of a valid compromise agreement.
intervention, on April 27, 1993; it is too late for [Kadakilaan Estate] to (Merced vs. Roman Catholic Archbishop, L-24614, August 17, 1967, 20
come in at this stage of the present litigation. Furthermore, as aptly put SCRA 1077). Consequently, the opinion of respondent Judge that his
by the [Republic] the alleged rights [Kadakilaan Estate] seeks to protect December 22, 1992 Decision had the nature of a judgment based on
here can be amply protected in an appropriate action compromise, cannot be upheld.
[Kadakilaan Estate] may later bring.
In a Decision,[32] dated 29 June 1994, the Court of Appeals granted the Republics Petition
So also, the doctrine relied on by respondents that a
for Certiorari and Mandamus, ruling in this wise compromise agreement constitutes the law between the parties and a
judgment based thereon is immediately final, executory and
not appealable, is inapplicable under the premises.
Aggrieved, BPC came before this Court via a Petition for Review on Certiorari[35] under
(a) declaring and affirming the validity of TCT Nos. 288417
Rule 45 of the Rules of Court, dated 28 April 1998, raising the sole issue of who between
and 275443 of the Registry of Deeds of Quezon City in the name of
appellant Republic of the Philippines and that appellant Republic has BPC and the Republic has a better title over the subject lots. BPC prays that this Court rule
indefeasible title to the property covered thereby;
in its favor, and reverse and set aside the Court of Appeals Decision, dated 8 August 1997,
already deposited in a trust account in the name of BPC with the Far East Bank and Trust
THE HONORABLE COURT OF APPEALES [sic] ERRED IN
APPLYING THE CALALANG CASE (231 SCRA 88) AS IT IS NOT Company (FEBTC). She bought Lots No. 27 and 28 after relying on the face of
APPLICABLE TO THE CASE AT BAR[.]
the TCTs of BPC which were intact and subsisting in the records of the Quezon City
Register of Deeds, and on the authority granted to BPC by several government agencies,
THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN NOT
FINDING [REPUBLIC] GUILTY OF ESTOPPEL BY LACHES[.] such as the HLURB, LRA, and the Register of Deeds, for the subdivision, development,
and sale of the subject lots to private individuals. She only came to know, through her
sister and attorney-in-fact, Nicolas-Agbulos, that the TCTs of BPC covering the subject
After the Republic filed its Comment, dated 29 October 1998, several parties
lots, which comprised the Parthenon Hills, were being assailed in Civil Case No. Q-92-
again sought to intervene in the case.
11806 pending before the RTC. Nicolas inquiry on the matter was answered by BPC with
an assurance that despite the bad publicity, Parthenon Hills was an on-going project and
Winnie U. Nicolas (Nicolas), through her sister and attorney-in-
that she should continue paying her installments. Acting cautiously, Nicolas-
fact, Ditas Felicitas Nicolas-Agbulos (Nicolas-Agbulos),
Agbulos decided that instead of paying the balance of the purchase price for Lots No. 27
and Edgardo Q. Abesamis (Abesamis), filed their respective Petitions for Intervention,
and 28 directly to BPC, she would open a trust account with FEBTC in the name of BPC
dated 22 October 1998 and 9 December 1998, respectively.
where she would deposit Nicolas-Agbulos succeeding installment payments. Nicolas-
Agbulos was compelled to intervene in the instant case because BPC made no mention of
Nicolas-Agbulos invokes the provisions of the Rules of Court on the joinder of
the fact that it had already sold numerous subdivision lots in Parthenon Hills to innocent
indispensable parties and necessary parties for the complete determination of all possible
purchasers for value, either through absolute or installment sales. She thus sought a ruling
issues, not only between the parties themselves but also as regards to other persons who
upholding the title of BPC, and recognizing and protecting the rights of Nicolas as an
may be affected by the judgment. Nicolas-Agbulos contends that she was a buyer in good
innocent purchaser for value of Lots No. 27 and 28. [36]
faith of Lots No. 27 and 28, Block 13, of Parthenon Hills, covered by TCTs No. 76497 and
76498, respectively, of the Quezon City Register of Deeds, derived from TCTs No. 30830,
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Land Titles and Deeds (Finals) 2017
Abesamis seeks to intervene in the present case as an indispensable party since favor 15 Deeds of Assignment for 15 subdivision lots in Parthenon Hills. The TCTs for the
no complete and conclusive determination can be had therein, which shall be legally 15 subdivision lots were transferred in the name of the spouses Santiago free from any
binding and effective on Abesamis, unless he be allowed to intervene. Abesamis claims to lien or encumbrance. The spouses Santiago mortgaged 13 of the subdivision lots with the
have acquired by purchase Lot No. 16, Block 4, of Parthenon Hills, for the purchase price Planters Development Bank and sold the remaining two to different buyers. Thereafter,
of P720,000.00, and evidenced by a Deed of Absolute Sale dated 9 June 1993. BPC BPC again executed in favor of the spouses Santigao 71 Deeds of Assignment over 71
processed and secured TCT No. 92270 covering Lot No. 16 in Abesamis name. He only subdivision lots in Parthenon Hills. When the spouses Santiago attempted to transfer
learned that the subject lots comprising the Parthenon Hills, including his Lot No. 16, was the TCTs covering the 71 subdivision lots to their names, they discovered that the TCTs of
mired in controversy, when he attended an emergency meeting of the Homeowners BPC already bore the annotation of the notice of lis pendens. The Quezon City Register of
Association of Parthenon Hills. He asserts that, being a bona fide purchaser and holder of Deeds cancelled the TCTs of BPC covering the 71 subdivision lots and issued new ones in
a legitimate and indefeasible title to Lot No. 16, he had valid and enforceable rights against the names of the spouses Santiago, still bearing the annotation of the notice
both BPC and the Republic.[37] of lis pendens. The spouses Santiago claim that they were unable to intervene earlier in
this case because of the pendency of the case filed by BPC against them, docketed as
A third Petition in Intervention, dated 8 February 1999, was filed by spouses Civil Case No. 93-18231, with the Quezon City RTC, Branch 84, for the annulment of the
Jacinto H. Santiago, Jr. and Arlene C. Santiago (spouses Santiago). The last 71 Deeds of Assignment. This case had since been dismissed. The
spouses Santiago aver that, doing business as ACS Trading, they entered into a supply spouses Santiago invoke that they have sufficient interest in the present case which would
agreement with Proven International Development Corporation (PIDC), which had a necessarily be affected by the resolution/decision thereof, and they must necessarily
construction contract with BPC, for the development of Parthenon Hills. The intervene herein to protect their interest. The spouses Santiago pray for this Court to
spouses Santiago agreed to accept lots in Parthenon Hills as payment for the construction declare the assignment to them by BPC of the subdivision lots as valid, and to direct both
materials they supplied BPC since the latter showed them clean TCTs to the subject lots, BPC and the Republic to recognize and respect their rights and interest. [38]
and HLURB licenses and permits to develop Parthenon Hills. In payment for the
construction materials delivered, and financial assistance and various other professional
BPC supports the intervention in the case by Nicolas-Agbulos and Abesamis. It
services rendered by the spouses Santiago to BPC, the latter initially executed in their
explains that its failure to mention that it has already practically sold all the subdivision lots
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Land Titles and Deeds (Finals) 2017
in Parthenon Hills was not by design, but by mere oversight. [39] However, BPC opposes the This Court, in a Resolution, dated 22 March 1999, granted the motion of the
Republic for the issuance of a temporary restraining order enjoining BPC from selling the
intervention of the spouses Santiago claiming that the latter are not indispensable parties
remaining unsold portions of the subject lots and from allowing buyers to enter and occupy
to the case; they acquired their TCTs through fraudulent means; and Civil Case No. 93-
portions thereof.[42]
18231 which it instituted against the spouses Santiago was dismissed by the Quezon City
Thereafter, BPC,[43] the Republic,[44] spouses Santiago,[45] Abesamis,[46] and Nicolas-
RTC, Branch 84, without prejudice. According to BPC, the supply agreement for
Agbulos,[47] filed their respective Memoranda.
construction materials was between the spouses Santiago and PIDC, so that it could not
be enforced against BPC. This issue, as well as the validity of the 71 Deeds of Assignment However, even before the case could be submitted for decision, Servandos heirs,
namely Virgilio V. Accibal (Virgilio), Virginia A. Macabudbod (Virginia), and Antonio, filed
over 71 subdivision lots supposedly executed by BPC in favor of the spouses Santiago,
an Urgent Ex Parte Motion to Defer Resolution of the same. Soon after, they filed a
requires the holding of a trial, not a mere intervention. [40]
Petition for New Trial, dated 23 May 2001.[48] Although Servandos heirs concede that the
period allowed for the filing of a motion to set aside the judgment and grant a new trial
The Republic opposed all efforts of other parties to intervene in the case. The
under Rule 37, Section 1 of the Rules of Court, had already lapsed, on grounds of justice
legal interests of Nicolas-Agbulos, Abesamis, and the spouses Santiago are totally and equity, they still move that this Court grant their Petition. Servandos heirs were
dependent on the alleged right of ownership of BPC, and the issues they raised are similar allegedly prevented from participating in Civil Case No. Q-92-11806 before the RTC by the
fraudulent misrepresentations of Rev. Father Antonio O. Ipo (Ipo), BPC President, together
to those raised by BPC. The fact that Nicolas-Agbulos and Abesamis are purchasers in
with the BPC counsel, who convinced the nave Antonio that there was no need to worry
good faith will not render their titles valid and indefeasible. The titles of Servando from
about the case filed by the Republic against them and to hire another counsel as the BPC
whom BPC acquired its titles and from whom, in turn, Nicolas-Agbulos and Abesamis,
counsel shall represent all of them. Unknown to Servandos heirs, the BPC counsel neither
derived their titles, were found to be spurious; and the spring cannot rise higher than its
represented them nor included them in the Answer he filed on behalf of BPC,
source.[41] thus, Servandos heirs were declared in default by the RTC. Because of the extrinsic fraud
In the interim, BPC filed its Reply dated 22 January 1999, to the Comment of the perpetrated upon them and their excusable negligence, Servandos heirs should be
granted a new trial, otherwise, they would be deprived of their constitutional right to due
Republic.
process of law. According to Servandos heirs, neither BPC nor the Republic was a
purchaser in good faith who acquired clean titles to the subject lots. The BPC
President Ipo, hoodwinked Antonio into agreeing to convey the subject lots to BPC in
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Land Titles and Deeds (Finals) 2017
exchange for 51% of its capital stock. However, despite acquiring titles to the subject lots, It is alleged by BPC and Servandos heirs that Servando was issued TCTs No. 200629 and
BPC failed to transfer the promised 51% of its capital stock. On the other hand, 200630 on 24 July 1974. However, there is an absolute dearth of information and proof as
the TCTs of FPHC, the Republics predecessor-in-interest, were of doubtful origin; and the to how Servando acquired ownership and came into possession of the subject lots.
Republics acquisition of the subject lots from FPHC was anomalous in the sense that it
An investigation conducted by the LRA revealed even more irregularities which raised
purchased the said property through ordinary sale when it could have easily expropriated
the same. serious doubts as to the validity and authenticity of TCTs No. 200629 and 200630. The
together with other documents to disprove the validity of the titles of Servando and his and exhaustive analysis of the evidence available.
heirs to the subject lots. SSP is a cooperative formed by the urban poor to help secure for First, it should be noted that despite letters sent by Investigator Flestado to BPC
its members award from the government of titles to the portions of the subject lots which President Ipo, Servando, and Antonio, requesting copies of documents to support the
they are presently occupying. It presented the affidavit of a certain Edith issuance of TCTs No. 200629 and 200630, they failed to file a reply and furnish him with
C. Mantaring,[50] who attests that the Accibals are still misrepresenting themselves as the documents requested. A certain Atty. Justino Z. Benito (Atty. Benito) appeared before
owners of the subject lots and fraudulently selling portions thereof to unsuspecting buyers. Investigator Flestado claiming to be the counsel for BPC and promising to
contact Servandos heirs. Yet, even by the time the LRA Report was finalized on 10 June
This Courts Ruling
1992, Atty. Benito still failed to submit the documents requested. Instead, he wrote letters
insisting that TCTs No. 200629 and 200630 be returned to the Quezon City Register of
Ultimately, this Court is called upon to determine which party now has superior title to the
Deeds since these certificates were detached and transferred to [your LRA central] office
subject lots: the Republic, BPC, the intervenors Abesamis, Nicolas-Agbulos, and
for no cogent reason or purpose; and his client, BPC, is a transferee in good faith and for
spouses Santiago, or Servandos heirs?
value, and its titles unchallenged.
BPC, the intervenors Abesamis, Nicolas-Agbulos, spouses Santiago, and Servandos heirs
derived their title to the subject lots from Servandos TCTs No. 200629 and 200630. This Second, although the 109-D forms on which TCTs No. 200629 and 200630 were printed
appeared to be genuine, and determined to have been issued to the Quezon City Register
Court then is compelled to look into the validity, authenticity, and existence of these
of Deeds on 5 July 1974, the signature therein of the Quezon City Register of Deeds Atty.
two TCTs.
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Land Titles and Deeds (Finals) 2017
Nestor N. Pea (Atty. Pea) was forged. No less than Atty. Pea himself refuted that the and designation of Atty. Pea appearing on the questionable TCTs No. 200629 and 200630
signatures on TCTs No. 200629 and 200630 were his. In his sworn statement, he noted compared to those on five other admittedly authentic TCTs.[51].
Register of Deeds on 27 May 1968, and served as such until his retirement in August of
Finally, Investigator Flestado made inquiries with the Land Management Bureau
1980, so that at the time when he supposedly signed TCTsNo. 200629 and 200630 on 24
July 1974, he was the Quezon City Register of Deeds, not the Deputy Register of Deeds. (LMB) regarding the consolidation-subdivision plan Pcs-2480 and plan Psu-32606 of Lots
34 and 40 (the subject lots) as described in TCTs No. 200629 and 200630. LMB Geodetic
Surveys Division Chief Privadi J.G. Dalire, in a letter, dated 29 November 1991, informed
Third, even the then incumbent Quezon City Register of Deeds
Investigator Flestado that LMB had no records of Pcs-2480, while the original copy of Psu-
Samuel Cleofe (RD Cleofe) and Deputy Register of Deeds Edgardo Castro (DRD Castro)
32606 is no longer available as it had been badly damaged. Thus, there was no record in
believed that TCTs No. 200629 and 200630 were spurious. According to RD Cleofe, the
the LMB that Lots 34 and 40, Psu-32606, were in fact consolidated and then subdivided
size of the area covered by the TCTs made him highly suspicious of the
into Lots 3, 4, 5, and 6 pursuant to plan Pcs-2480, as mentioned in TCTs No. 200629 and
same. In Quezon City, only a few people own big tracts of land, namely,
the Aranetas, Tuazons, etc. Commonly, ordinary individuals own only 300 to 2,000 square 200630.
meters of land. Both RD Cleofe and DRD Castro identified differences in the signatures
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Land Titles and Deeds (Finals) 2017
To rebut the foregoing findings of LRA Investigator Flestado, BPC presented, in subject of NBI Questioned Documents Report No. 636-991, dated 31 March 1992,
support of the authenticity and validity of TCTs No. 200629 and 200630, the LRA mentioned in the LRA Report) or the accuracy of the entries made therein.
Resolution,[52] dated 4 November 1991, in Consulta No. 1957, and NBI Questioned
Documents Report No. 585-891,[53] dated 2 September 1991. A careful study of the said The LRA Report, dated 10 June 1992, of Investigator Flestado was submitted as
documents does little to support the position of BPC. evidence before the RTC. It must be emphasized that the LRA Report was extensive and
thorough. Its findings are sufficiently supported by independent and reliable proof. The
The LRA Resolution in Consulta No. 1957 merely allowed the registration of the BPC failed to present evidence to refute the same. The LRA Report deserves great weight
rescission of a Joint Venture Agreement on TCTs No. 200629 and 200630 despite the sufficient to overcome the presumption that TCTs No. 200629 and 200630 were genuine,
initial adverse finding that the said certificates were of doubtful authenticity. It did not make authentic, and indefeasible.[54]
any categorical finding as to the authenticity or validity of the TCTs. In fact, the last
paragraph of the said Resolution elucidated that It having been established that TCTs No. 200629 and 200630 were forged and
spurious, their reconstitution was also attended with grave irregularities. Once more, this
This resolution, however, should be understood to be limited
to the issue of registrability of the instrument sought to be registered Court relies on the findings in the LRA Report, dated 10 June 1992, of
and is without prejudice to any action, if warranted, that may be filed
in court assailing the validity or authenticity of the certificate of Investigator Flestado. Quezon City RD Cleofe; the unnamed Chief of the LRA
titles. (Emphasis supplied.)
Micrographics and Computer Division; and Records Officer Viterbo Cahilig of
the Quezon City Register of Deeds, all confirmed that there were no records of any
The NBI Questioned Documents Report No. 585-891 was even in accordance
applications for reconstitution of TCTs No. 200629 and 200630 in the name of Servando. It
with the finding in the LRA Report that the 109-D forms on which TCTs No. 200629 and
would seem that an LRA employee, Cartographer Rovil Ruiz (Ruiz), made it appear that
200630 were printed seemed to be genuine. The NBI concluded that the words 109-D and
there were applications for reconstitution of TCTs No. 200629 and 200630 filed, and which
the serial numbers printed on the forms were not altered. The NBI did a very limited
were included in Folder 1614. When Folder 1614 was inspected, TCTs No. 200629 and
examination of the genuineness of the forms on which TCTs No. 200629 and 200630 were
200630 were not included in its table of contents; and although the said folder did have 44
printed, but it did not look into the authenticity of Atty. Peas signature (which was the
missing pages, the missing pages pertain to the supporting documents of other TCTs, and
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Land Titles and Deeds (Finals) 2017
there was no showing that TCTs No. 200629 and 200630 and the applications for the titles of the Republic to the subject lots by averring that the transfer thereof from FPHC
reconstitution thereof were among these missing pages. Ruiz undertook by himself the to the Republic was highly irregular because the latter could have acquired the property by
computation of the tie-lines of the subject lots as described in TCTs No. 200629 and expropriation.Such an averment is totally baseless. Expropriation as the means by which
200630, the plotting, and examination of the titles. The LRA Report thus recommended the State can acquire private property is always the remedy of last resort. Expropriation
that Ruiz be administratively charged for grave misconduct, it appearing that he was the lies only when it is made necessary by the opposition of the owner of the property to the
one who facilitated the administrative reconstitution of TCTs No. 200629 and 200630. sale or by the lack of any agreement as to the price.[55] There being, in the present case,
valid and subsisting contracts between the FPHC, the previous owner, and the Republic,
In contrast, the Republic was able to supply Investigator Flestado with the the buyer, for the purchase of the subject lots at an agreed price, there was no reason for
documents supporting the transfer of the titles to the subject lots from FPHC to the the expropriation.
Republic, among which were the TCTs of FPHC, the Deeds of Sale executed by FPHC to .
the Republic, notice to the real property owners within 300-meter radius from the area, In consideration of all the foregoing findings, it is indubitable that TCTs No.
receipts for payment of registration fees, and payment order for the documentary stamp 275443 and 288417 of the Republic covering the subject lots are authentic and valid,
tax on the sales. TCTs No. 275443 and 288417 in the name of the Republic were included while TCTs No. 200629 and 200630 of Servando covering the same property are not.
in LRA Folder No. 1976-B, together with other certificates of title in the name of the
Republic. One of the applications filed by the Republic was docketed as Application for However, BPC maintains that it was a purchaser in good faith, for value and
Reconstitution No. 41869. The Chief of the LRA Micrographics and Computer Division without any inkling about any flaw from Servandos titles. It points out that it purchased the
confirmed that the applications for reconstitution of TCTs No. 275443 and 288417 by the subject lots from Servando on 8 February 1989 and registered the same on 19 February
Republic were recorded in the computerized Administrative Reconstitution System. 1991, way before the titles of Servando were declared null by the RTC on 22 December
1992. BPC relies on this Courts ruling in Tenio-Obsequio v. Court of Appeals,[56] to wit
BPC was unable to attack the authenticity and validity of the titles of the Republic
Under Section 55 of the Land Registration Act, as amended
to the subject lots, and could only interpose the defense that it was a buyer in good by Section 53 of Presidential Decree No. 1529, an original owner of
registered land may seek the annulment of a transfer thereof on the
faith. Only Servandos heirs, in their Petition for New Trial, attempted to raise doubts as to ground of fraud. However, such a remedy is without prejudice to the
rights of any innocent holder for value with a certificate of title.
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Land Titles and Deeds (Finals) 2017
the certificate and investigate the title of the vendor appearing on the
A purchaser in good faith and for value is one who buys the face of said certificate.
property of another, without notice that some other person has a right to
or interest in such property, and pays a full and fair price for the same
at the time of such purchase or before he has notice of the claim or
interest of some other person in the property. In consonance with this Now the question is whether BPC qualifies as an innocent purchaser for value which
accepted legal definition, petitioner Consorcia Tenio-Obsequio is a
purchaser in good faith. There is no showing whatsoever nor even an acquired valid titles to the subject lots, despite the fact that the titles of its predecessor-in-
allegation that herein petitioner had any participation, voluntarily or
otherwise, in the alleged forgery. interest were found to be forged and spurious.
xxxx
The main purpose of the Torrens system is to avoid possible This Court finds in the negative.
conflicts of title to real estate and to facilitate transactions relative
thereto by giving the public the right to rely upon the face of a Torrens
certificate of title and to dispense with the need of inquiring further,
except when the party concerned has actual knowledge of facts and Foremost is the fact that there seem to be two documents by which titles to the subject lots
circumstances that should impel a reasonable cautious man to make
such further inquiry. Where innocent third persons, relying on the were transferred from the Accibals to BPC: (1) A Deed of Conveyance, dated 8 February
correctness of the certificate of title thus issued, acquire rights over the
property, the court cannot disregard such rights and order the total 1989, executed by Servando in favor of BPC, transferring to the latter titles to the subject
cancellation of the certificate. The effect of such an outright cancellation
would be to impair public confidence in the certificate of title, for lots in exchange for 51% of its capital stock; and (2) A Deed of Conveyance, dated 10
everyone dealing with property registered under the Torrens system
would have to inquire in every instance as to whether the title has been October 1990, executed by Antonio in favor of BPC, transferring to the latter the very same
regularly or irregularly issued by the court. Every person dealing with
registered land may safely rely on the correctness of the certificate of property in exchange for 2,450 shares in BPC. It should be noted that even prior to these
title issued therefor and the law will in no way oblige him to go beyond
the certificate to determine the condition of the property. Deeds of Conveyance, Servando already transferred the subject lots by way of a Deed of
xxxx Absolute Sale, dated 10 June 1988, in favor of his son Antonio, with the concurrence of his
It has been consistently ruled that a forged deed can legally other heirs. Thus, by the time Servando executed the Deed of Conveyance over the
be the root of a valid title when an innocent purchaser for value
intervenes. A deed of sale executed by an impostor without the subject lots in favor of BPC on 8 February 1989, he no longer had any right to the said
authority of the owner of the land sold is a nullity, and registration will
not validate what otherwise is an invalid document. However, where the property, having sold the same to Antonio. It was probably to rectify this mistake that a
certificate of title was already transferred from the name of the true
second Deed of Conveyance was executed by Antonio on 10 October 1990. Comparing all
owner to the forger and, while it remained that way, the land was
subsequently sold to an innocent purchaser, the vendee had the right to
these transfer documents, the LRA Report, dated 10 June 1992, prepared by
rely upon what appeared in the certificate and, in the absence of
anything to excite suspicion, was under no obligation to look beyond
Investigator Flestado noted that Servandos Tax Account Number (TAN) in the Deed of
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Land Titles and Deeds (Finals) 2017
Conveyance, dated 8 February 1989, which he executed over the subject lots in favor of In addition, without the original copies and owners duplicate copies of TCTs No.
BPC, was A2140-M1746-A-1; while in the Deed of Sale, dated 10 June 1988, which he 200629 and 200630, BPC had to rely on the reconstituted certificates, issued on 12
executed over the subject lots in favor of Antonio, his TAN was 4110-241-R. Moreover, December 1990, bearing the following numbers: TCTs No. RT-23687 (for TCT No.
despite being executed a year apart, Servando had the same residence certificate (No. 200629) and RT-23688 (for TCT No. 200630). Under section 7 of Republic Act No.
5901393, issued at QuezonCity, on 6 April 1988) appearing in both documents. 26,[57] "Reconstituted titles shall have the same validity and legal effect as the originals
Furthermore, BPC cannot really claim that it was a purchaser in good faith which relied thereof" unless the reconstitution was made extrajudicially.[58] In this case, TCTs No.
upon the face of Servandos titles. It should be recalled that the Quezon City Register of 200629 and 200630 were reconstituted administratively, hence, extrajudicially. In contrast
Deeds caught fire on 11 June 1988. Presumably, the original copies of TCTs No. 200629 to the judicial reconstitution of a lost certificate of title which is in rem, the administrative
and 200630 were burnt in the said fire. Servandos heirs sought the administrative reconstitution is essentially ex-parte and without notice.[59] The reconstituted certificates of
reconstitution of of TCTs No. 200629 and 200630 only in December 1990. The two Deeds title do not share the same indefeasible character of the original certificates of title for the
of Conveyance over the subject lots were executed in favor of BPC by Servando and following reason
Antonio on 8 February 1989 and 10 October 1990, respectively, both prior to the x x x The nature of a reconstituted Transfer Certificate Of Title of
registered land is similar to that of a second Owner's Duplicate Transfer
administrative reconstitution of TCTs No. 200629 and 200630. If BPC bought the subject Certificate Of Title. Both are issued, after the proper proceedings, on
the representation of the registered owner that the original of the said
lots after TCTs No. 200629 and 200630 were destroyed when the Quezon City Register of TCT or the original of the Owner's Duplicate TCT, respectively, was lost
and could not be located or found despite diligent efforts exerted for
Deeds burned down, but before the said certificates were reconstituted, then on the face of that purpose. Both, therefore, are subsequent copies of the originals
thereof. A cursory examination of these subsequent copies would show
what titles did BPC rely on before deciding to proceed with the purchase of the subject that they are not the originals. Anyone dealing with such copies are put
on notice of such fact and thus warned to be extra-careful. x x x.[60]
lots? There was no showing that there were surviving owners duplicate copies of TCTs No.
200629 and 200630, or even if there were, without the original copies of the
The fact that the TCTs were reconstituted should have alerted BPC and its officers to
said TCTs which were stored in the Quezon City Register of Deeds and purportedly
conduct an inquiry or investigation as might be necessary to acquaint themselves with the
destroyed in the fire, there would have been no way for BPC to have verified the owners
defects in the titles of Servando.[61]
duplicate copies.
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Land Titles and Deeds (Finals) 2017
What is more, BPC again invokes LRA Resolution, dated 4 November 1991, with a par value of P100.00 each, amount only to P245,000.00. This Court cannot find a
in Consulta No. 1957, and NBI Questioned Documents Report No. 585-891, dated 2 plausible explanation for the discrepancy in the value of 2,450 shares of BPC between
September 1991 as proof that it did inquire or investigate into the validity and authenticity the P245,000.00 it has hereby computed and the P49,000,000.00 claimed by BPC.
of Servandos titles. But again, it should be noted that these documents were
issued after BPC already acquired the subject lots from Servando and Antonio. For the above-stated reasons, this Court cannot declare BPC an innocent
purchaser for value, and it acquired no better titles to the subject lots than its
Lastly, there are serious doubts that BPC acquired the subject lots for value. The Republic predecessors-in-interest, Servando and Antonio.
bought the subject lots from FPHC for the combined price of P12,333,280.00. BPC, on the
other hand, supposedly acquired the subject lots from Servando on 8 February 1989 in At this point, it would seem that the Republic does hold better titles to the subject
exchange for 51% of the capital stock of BPC, with a subscription value lots. Nonetheless, another level of transactions involving the subject lots was brought
of P6,000,000.00. In the LRA Report, dated 10 June 1992, Investigator Flestado pointed by intervenors to the attention of this Court.
out that in the Articles of Incorporation, dated 16 January 1989, of BPC, submitted to the
Securities and Exchange Commission (SEC) on 20 January 1989, BPC had an authorized From the reconstituted TCTs No. RT-23687 (200629) and RT- 23688 (200630) in
capital stock of only P1,000,000.00, which was divided into 10,000 shares, with a par value the name of Servando, BPC derived and was issued by the Quezon City Register of
of P100.00 each; and the amount of capital stock actually subscribed Deeds new certificates, TCTs No. 30829, 30830, 30831 and 30832, in its own name. It
was P250,000.00. Therefore, in 1989, fifty-one percent of the capital stock of BPC would was able to secure the necessary licenses and permits from the appropriate government
be 5,100 shares, with an aggregate value of only P510,000.00. BPC is not saved by the agencies to subdivide, develop, and sell the subject lots as Parthenon Hills. The Parthenon
second Deed of Conveyance, executed more than a year later by Antonio, again Hills project was openly advertised and marketed, and a substantial portion of the subject
transferring to BPC the subject lots in exchange for 2,450 shares in the latter, with the lots was already sold by BPC to the public.
alleged value of P49,000.000.00. Unless BPC is able to present proof that it applied for,
and the SEC approved, a substantial increase in its capital stock, then this Court can only Except for the spouses Santiago, BPC recognizes that the intervenors, Nicolas-
assume that its capital stock remained the same as the year before, 2,450 shares in BPC, Agbulos and Abesamis, together with other legitimate homeowners in Parthenon Hills,
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Land Titles and Deeds (Finals) 2017
acquired from BPC titles to their respective subdivided lots in good faith and for
value. Even the Republic could not refute that the individuals who acquired lots in The forged TCTs No. 200629 and 200630 were later administratively
reconstituted, and although an investigation would show that their reconstitution was also
Parthenon Hills from BPC were purchasers in good faith and for value. It insists, however,
attended with irregularities, TCTs No. RT-23687 (200629) and RT-23688 (200630) appear,
that these buyers could not acquire better titles to the property than its predecessors-in-
on either face, to have been duly approved by the LRA and issued by the Quezon City
interest BPC, Servando, and Antonio since the spring cannot rise higher than its
Register of Deeds. With the cancellation of the reconstituted TCTs and the issuance of
source. The law must protect and prefer the lawful holder of registered title over the new ones, TCTs No. 30829, 30830, 30831, and 30832, in the name of BPC, any trace of
transferee of a vendor bereft of any transmissible rights.[62] forgery or irregularity as to BPCs titles was eliminated. TCTs No. 30829, 30830, 30831,
and 30832 were clean, at least, until the annotation therein of the notice of lis pendens of
the Republic on 21 October 1992. It is a settled doctrine that one who deals with property
It is true that the general rule is that a forged deed is a nullity and conveys no
registered under the Torrens system need not go beyond the same, but only has to rely on
title.[63] A forged deed may be defined as an instrument which purports to have been
the certificates of title. He is charged with notice only of such burdens and claims as are
executed by the person or persons whose signatures appear thereon, but which, in fact,
annotated on the certificates.[66] Herein intervenors, Nicolas-Agbulos and Abesamis, before
was not executed, and the signatures thereon had been merely imitated so as to give them purchasing subdivision lots in Parthenon Hills, looked into the TCTs of BPC and found
the deceptive appearance of genuineness. [64] In the case at bar, it was not any of the nothing on the face thereof to raise doubts or suspicions as to their validity and
deeds of transfer or conveyance of the subject lots which was forged, but TCTs No. authenticity. Besides, BPC was the holder of licenses and permits to subdivide, develop,
and sell the subject lots as Parthenon Hills, issued by the appropriate government
200629 and 200630 themselves. The forged TCTs, nevertheless, just as a forged deed,
agencies, primarily HLURB.
can make it appear that one had title, right, or interest to the land, when in truth, he had
none, to the deprivation of the rightful owner. It has been recognized that while a forged
instrument is null and void and of no effect as between the parties, it may nevertheless be
This is definitely a situation which constitutes an exception to the general rule
the root of a good title; so that the title of a registered owner who has taken it bona that estoppel cannot lie against the government. The Republic v. Court of
fide and for value, is not affected by reason of his claiming through someone, that the Appeals,[67] provides an illuminating discourse on when such an exception applies, thus
registration was void because it had been procured by the presentation of a forged
lots sold in good faith by a private developer to innocent purchasers for encumbrances annotated on the titles, private respondents purchasers
value, notwithstanding its approval of the subdivision plan and its could not have had notice of defects that only an inquiry beyond the
issuance of separate individual certificates of title thereto? face of the titles could have satisfied. The rationale for this presumption
has been stated thus:
xxxx
"The main purpose of the Torrens System
The general rule is that the State cannot be put in estoppel by is to avoid possible conflicts of title to real estate and
the mistakes or errors of its officials or agents. However, like all general to facilitate transactions, relative thereto by giving
rules, this is also subject to exceptions, viz: the public the right to rely upon the face of a Torrens
Certificate of Title and to dispense with the need of
"Estoppels against the public are little
inquiring further, except when the party concerned
favored. They should not be invoked except in rare
had actual knowledge of facts and circumstances
and unusual circumstances, and may not be invoked
that should impel a reasonably cautious man to
where they would operate to defeat the effective
make such further inquiry (Pascua v. Capuyoc, 77
operation of a policy adopted to protect the public.
SCRA 78). Thus, where innocent third persons
They must be applied with circumspection and
relying on the correctness of the certificate thus
should be applied only in those special cases where
issued, acquire rights over the property, the court
the interests of justice clearly require it.
cannot disregard such rights (Director of Land
Nevertheless, the government must not be allowed
v. Abache, et al., 73 Phil. 606)."
to deal dishonorably or capriciously with its citizens,
and must not play an ignoble part or do a shabby In another case, this Court further said:
thing; and subject to limitations x x x the doctrine of
equitable estoppel may be invoked against public "The Torrens System was adopted in this
authorities as well as against private individuals." country because it was believed to be the most
effective measure to guarantee the integrity of land
xxxx titles and to protect their indefeasibility once the
claim of ownership is established and recognized. If
Significantly, the other private respondents Spouses Santos,
a person purchases a piece of land on the
Spouses Calaguian, Dela Fuente and Madaya bought such "expanded"
assurance that the seller's title thereto is valid, he
lots in good faith, relying on the clean certificates of St. Jude, which had
should not run the risk of being told later that his
no notice of any flaw in them either. It is only fair and reasonable to
acquisition was ineffectual after all. This would not
apply the equitable principle of estoppel by laches against the
only be unfair to him. What is worse is that if this
government to avoid an injustice to the innocent purchasers for value.
were permitted, public confidence in the system
Likewise time-settled is the doctrine that where innocent third would be eroded and land transactions would have
persons, relying on the correctness of the certificate of title, acquire to be attended by complicated and not necessarily
rights over the property, courts cannot disregard such rights and order conclusive investigations and proof of ownership.
the cancellation of the certificate. Such cancellation would impair public The further consequence would be that land
confidence in the certificate of title, for everyone dealing with property conflicts could be even more abrasive, if not even
registered under the Torrens system would have to inquire in every violent. The Government, recognizing the worthy
instance whether the title has been regularly issued or not. This would purposes of the Torrens System, should be the first
be contrary to the very purpose of the law, which is to stabilize land to accept the validity of titles issued thereunder once
titles. Verily, all persons dealing with registered land may safely rely on the conditions laid down by the law are satisfied.
the correctness of the certificate of title issued therefor, and the law or [Italics supplied.]
the courts do not oblige, them to go behind the certificate in order to
Petitioner never presented proof that the private respondents
investigate again the true condition of the property. They are only
charged with notice of the lions and encumbrances on the property that who had bought their lots from St. Jude were buyers in bad faith.
are noted on the certificate. Consequently, their claim of good faith prevails. A purchaser good faith
and for value is one who buys the property of another without notice
When private respondents-purchasers bought their lots from that some other person has a right to or an interest in such property;
St. Jude, they did not have to go behind the titles thereto to verify their
and who pays a full and fair price for the same at the time of such
contents or search for hidden defects or inchoate rights that could
defeat their rights to said lots. Although they were bound by liens and purchase or before he or she has notice of the claims or interest of
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Land Titles and Deeds (Finals) 2017
some other person. Good faith is the honest intention to abstain from
taking any unconscientious advantage of another. further asserted that the spouses Santiago acquired the said subdivision lots by fraudulent
means. The allegations by the spouses Santiago of good faith, on one hand, and by BPC
of fraud, on the other, in the acquisition by the spouses Santiago of the subdivision lots in
question, are factual matters, best proven and established before the RTC, which could
It also bears to emphasize that the subject lots covered by TCTs No. 30829,
30830, 30831, and 30832 were already subdivided, and new TCTs were issued in the receive evidence in support of each partys position during trial. Should the RTC find that
names of the buyers of each subdivision lot. To order the cancellation of all these the spouses Santiago have indeed acquired the subdivision lots in good faith and for
derivative titles and the return of the subdivision lots to the Republic shall irrefragably be value, then their titles thereto shall, likewise, be valid and indefeasible even against that of
unjust to the innocent purchasers for value and shall wreak havoc on the Torrens System.
the Republic. However, in a contrary case, should the RTC find that the
spouses Santiagoacquired the subdivision lots by fraud, then titles thereto return to BPC.
Anyway, the Republic is not without recourse. It can claim damages from BPC,
found herein not to be a buyer of the subject lots in good faith. For its loss of portions of Though estoppel by laches may lie against the Republic when titles to the
the subdivision lots to innocent purchasers from BPC, the Republic may recover from BPC subdivision lots are already in the names of the respective innocent purchasers for value
the purchase price it paid to FPHC corresponding to such subdivision lots, with interest at from BPC, it may not be used by BPC to defeat the titles of the Republic as regards the
6% per annum from 26 March 1992 (the date when the Republic instituted its petition for
subdivision lots which remain unsold and the titles to which are still in the name of BPC. It
the cancellation of the TCTs of Servando, Antonio, and BPC) until finality of this Decision,
must be recalled that BPC is not a purchaser in good faith. Estoppel, being an equitable
and 12% per annum thereafter until fully paid. [68]
principle, may only be invoked by one who comes to court with clean hands. [69]
Although this Court allowed in the case at bar the intervention of Nicolas- Pertinent provisions of the New Civil Code concerning builders in bad faith
Agbulos and Abesamis, and recognized their title to their respective subdivision lots in provide that
Parthenon Hills as purchasers in good faith and for value from BPC, it could not do the ART. 449. He who builds, plants, or sows in bad faith on the
land of another, loses what is built, planted or sown without right to
same for the spouses Santiago, for the reason that BPC contested their claim that they indemnity.
had acquired titles to the subdivision lots in Parthenon Hills in good faith and for value, and ART. 450. The owner of the land on which anything has been
built, planted or sown in bad faith may demand the demolition of the
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Land Titles and Deeds (Finals) 2017
has the option to either (1) recover the said lots and demand that BPC demolish whatever (b) Newly discovered evidence, which he could not, with
reasonable diligence, have discovered and produced at the trial, and
improvements it has made therein, to return the lots to their former condition, at the which if presented would probably alter the result.
expense of BPC; or (2) compel BPC to pay the price of the land. The choice can only be
made by the Republic, as the rightful owner of the said subject lots. Should the Republic Servandos heirs themselves admit that the period allowed for the filing of a
motion to set aside the judgment and grant a new trial under the afore-quoted provision
choose the first option, BPC is under the obligation to return the possession of the
had already lapsed, but they still pray that this Court give due course to their Petition on
subdivision lots to the Republic and surrender its corresponding TCTs for cancellation and
the grounds of justice and equity.
issuance of new ones in the name of the Republic. Should the Republic select the second
option, then BPC shall pay the Republic the purchase price that the latter had paid to
FPHC corresponding to such subdivision lots, with interest at 6% per annum from 26 In Malipol v. Lim Tan,[70] this Court ruled that
March 1992 until finality of this Decision, and 12% per annum thereafter until fully paid. In
either option, the Republic may claim damages from BPC, while BPC cannot seek
It is within the sound discretion of the court to set aside an
order of default and to permit a defendant to file his answer and to be
indemnity from the Republic for any improvements made on the subdivision lots, except if
heard on the merits even after the reglementary period for the filing of
the answer has expired, but it is not error, or an abuse of discretion, on
these constitute as necessary expenses for the preservation of the land, for which it shall
the part of the court to refuse to set aside its order of default and to
still be entitled to reimbursement. refuse to accept the answer where it finds no justifiable reason for the
delay in the filing of the answer. In the motions for reconsideration of an
order of default, the moving parry has the burden of showing such
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Land Titles and Deeds (Finals) 2017
diligence as would justify his being excused from not filing the answer
within the reglementary period as provided by the Rules of Court, consecutive motions for extension of time to file the appropriate pleadings. There was no
otherwise these guidelines for an orderly and expeditious procedure
would be rendered meaningless. Unless it is shown clearly that a party explanation provided as to why, despite the grant of said motions, the counsel still failed to
has justifiable reason for the delay, the court will not ordinarily exercise
its discretion in his favor. file an answer to the Republics petition for cancellation of title. It is also contrary to
common human experience that Servandos heirs, by the mere assurance of the President
and counsel of BPC, adopted a totally hands-off attitude in a case where they supposedly
have substantial interest. There is no showing during the nine years when they were not
In the present case, the late Servando and Antonio were already declared in
default by the RTC on 31 July 1992, after their supposed counsel failed to file an answer to participating in the court proceedings, that they, at least, inquired into or followed-up on the
the Republics petition for cancellation of title. Nothing was heard from Servandos heirs status of the case with BPC. Such blind trust in the President and counsel of BPC is surely
even after the promulgation of the RTC Decision on 22 December 1992, and the Court of difficult to comprehend, especially if this Court takes into account the contention
Appeals Decision, dated 8 August 1997, until they filed their Petition for New Trial,
of Servandos heirs that BPC failed to deliver the shares of stock in exchange for the
dated 23 May 2001, before this Court, or nine years from the date they were declared in
subject lots. What is apparent to this Court is not the alleged fraud committed by BPC but,
default.
rather, the inexcusable negligence of Servandos heirs when it came to protecting their
titles, rights, and interests to the subject lots, if indeed, there were still any.
President and counsel of BPC, they were prevented from participating in the proceedings Worth reproducing herein, is the conclusion[71] made by the Court of Appeals
before the trial court. They allegedly relied on the assurance of the President and counsel on Servandos titles
of BPC that the latter shall also represent them and their interests in the subject lots in the
On the strength of the LRA report, Exhibit H (Record, pp. 214-
258), the court a quo found TCT Nos. 200629 and 200630, in the name
case.
of Servando Accibal and from which the titles of defendant-
appellee Barstowe Philippines Corporation were derived, spurious, and
ordered the Register of Deeds of Quezon City to officially and finally
cancel (said titles) from his records (Par. 2, dispositive portion,
This allegation of fraud by Servandos heirs has no leg to stand on. It should be
Decision, p. 16; Rollo, p. 71). As explained by the court a quo:
recalled that the late Servando and Antonio were represented by a counsel at the
We shall now dwell on the validity of the
beginning of the proceedings before the RTC. Their counsel even submitted two titles, TCT Nos. 200629 and 200630, issued in the
name of Servando Accibal on July 24, 2974 by the
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Land Titles and Deeds (Finals) 2017
Parthenon Hills. Relying on the face of the certificates of title of BPC and the licenses and
(1) The certificates of title acquired by Servando over the subject lots
(6) The claims of the intervenor spouses Santiago that they acquired
were forged and spurious, and such finding made by both the RTC and Court of Appeals is
portions of the subject lots in good faith and for value still need to be proven during trial
already final and binding on Servandos heirs;
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Land Titles and Deeds (Finals) 2017
before the court a quo. Unlike the claims of intervenors Nicolas-Agbulos and Abesamis, No. 47522 is hereby REVERSED and SET ASIDE and a new one is hereby entered, as
which BPC admitted, the claims of the spouses Santiago were opposed by BPC on the follows:
ground of fraud;
(1) In view of the finding that the Transfer Certificates of Title No. 200629 and
(7) Certificates of title over portions of the subject lots, acquired by 200630 in the name of Servando Accibal are forged and spurious, the Quezon City
purchasers in good faith and for value, from BPC, are valid and indefeasible, even as Register of Deeds is ORDERED to officially and finally cancel the same from his records;
against the certificates of title of the Republic. The Republic, however, is entitled to recover
from BPC the purchase price the Republic paid to FPHC for the said portions, plus (2) In view of the finding that the respondent Republic of the Philippines was a
appropriate interests; and purchaser in good faith of the subject lots from Philippine First Holdings Corporation, but
also taking into consideration the functioning and stability of the Torrens System, as well
(8) As portions of the subject lots are still unsold and their corresponding as the superior rights of subsequent purchasers in good faith and for value of portions of
certificates of title remain in the name of BPC, the Republic may exercise two options: (a) the subject lots subdivided, developed, and sold as Parthenon Hills from
It may recover the said portions and demand that BPC demolish whatever improvements it petitioner Barstowe Philippines Corporation
has made therein, so as to return the said portions to their former condition, at the expense
of BPC. In such a case, certificates of title of BPC over the said portions shall be cancelled (a) The Quezon City Register of Deeds is ORDERED to
and new ones issued in the name of the Republic; or (b) It may surrender the said portions cancel Transfer Certificates of Title No. 275443 and 288417 in the
to BPC and just compel BPC to reimburse the Republic for the purchase price the name of respondent Republic of the Philippines;
Republic paid to FPHC for the said portions, plus appropriate interest.
WHEREFORE, premises considered, the instant Petition is hereby PARTLY the Philippines is ORDERED to respect and recognize the certificates
GRANTED. The Decision, dated 8 August 1997, of the Court of Appeals in CA-G.R. CV of title to the subject portions of land in the name of purchasers of good
(c) Petitioner Barstowe Philippines Corporation expenses incurred by the latter for the said portions;
purchase price the latter paid to First Philippine Holdings Corporation (2) In view of the finding that petitioner Barstowe Philippines Corporation
corresponding to the portions of the subject lots which are already is not a purchaser and builder in good faith, and depending on the option chosen by
covered by certificates of title in the name of purchasers in good faith respondent Republic of the Philippines concerning the portions of the subject lots which
and for value from petitioner Barstowe Philippines Corporation, plus remain unsold and covered by certificates of title in the name of
appropriate interest; petitioner Barstowe Philippines Corporation, as enumerated in paragraph 2(d) hereof
is ORDERED to choose one of the options available to it as regards the (a) In case the respondent Republic of the Philippines
portions of the subject lots which remain unsold and covered by chooses the option under paragraph 2(d)(i) hereof,
certificates of title in the name of petitioner Barstowe Philippines petitioner Barstowe Philippines Corporation is ORDERED to demolish
Corporation, either (i) To recover the said portions and demand that whatever improvements it has made on the said portions, so as to
petitioner Barstowe Philippines Corporation demolish whatever return the same to their former condition, at its own
improvements it has made therein, so as to return the said portions to expense. The Quezon City Register of Deeds is also ORDERED to
their former condition, at the expense of the latter, or (ii) To surrender cancel the certificates of title of petitioner Barstowe Philippines
the said portions to petitioner Barstowe Philippines Corporation and Corporation over the said portions and to issue in lieu thereof
compel the latter to reimburse the respondent Republic of the certificates of title in the name of respondent Republic of
Philippines for the purchase price it had paid to First Philippine the Philippines;
interest. Regardless of the option chosen by the respondent Republic of (b) In case the respondent Republic of the Philippines
the Philippines, it is ORDERED to reimburse chooses the option under paragraph 2(d)(ii) hereof,
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Land Titles and Deeds (Finals) 2017
petitioner Barstowe Philippines Corporation is ORDERED to reimburse than intervenors Winnie U. Nicolas-Agbulos and Edgardo Q. Abesamis,
paid to First Philippine Holdings Corporation for the said portions, plus (b) The identification of the portions of the subject lots in the
appropriate interest; possession and names of purchasers in good faith and for value and
appropriate damages to respondent Republic of the Philippines as may (c) The computation of the amount of the purchase price
be determined by the trial court; which respondent Republic of the Philippines may recover from
of the subject lots subdivided, developed, and sold as Parthenon Hills from (d) The types and computation of the damages recoverable
are valid and indefeasible as to all parties; (e) The computation and award of the cross-claim of EL-VI
(4) In view of the finding that the Petition for New Trial filed by the heirs Realty and Development Corporation against
of Servando Accibal, namely, Virgilio V. Accibal, Virginia A. Macabudbud, and Antonio petitioner Barstowe Philippines Corporation.
(5) The case is REMANDED to the court of origin for determination of the SO ORDERED.
following
purchasers, in good faith and for value, of portions of the subject lots
[G.R. No. 116111. January 21, 1999] Caloocan City cancelled TCT No. 22660 and in lieu thereof issued Certificates of Title Nos.
23967 up to 24068 inclusive, all in the name of defendants St. Judes Enterprises, Inc. The
subdivision of lot 865-B-1 [which was] covered [by] TCT No. 22660 was later found to have
expanded and enlarged from its original area of 40,523 square meters to 42,044 square
meters or an increase of 1,421 square meters. This expansion or increase in area was
REPUBLIC OF THE PHILIPPINES, (Represented by the Acting Commissioner of Land confirmed by the land Registration Commission [to have been made] on the northern
Registration), petitioner, vs. COURT OF APPEALS, Spouses CATALINO portion of Lot 865-B-1.
SANTOS and THELMA BARRERO SANTOS, ST. JUDES ENTERPRISES,
INC., Spouses DOMINGO CALAGUIAN and FELICIDAD CALAGUIAN,
VIRGINIA DE LA FUENTE and LUCY MADAYA, respondents. Subsequently, defendant St. Judes Enterprises, Inc. sold the lots covered by TCT Nos.
24013 and 24014 to defendant Sps. Catalino Santos and Thelma Barreto Santos[;] TCT
No. 24019 to defendant Sps. Domingo Calaguian and Felicidad de Jesus[;] TCT No.
DECISION 24022 to defendant Virginia dela Fuente[;] and TCT No. 2402[3] to defendant Lucy
Madaya. Accordingly, these titles were cancelled and said defendants were issued the
PANGANIBAN, J.:
following: TCT No. C-43319 issued in the name of Sps. Santos containing an area of 344
square meters[;] TCT No. 55513 issued in the name of defendants Sps. Calaguian
Is the immunity of the government from laches and estoppel absolute? May it still containing an area of 344 square meters[;] TCT No. 13309 issued in the name of Sps.
recover the ownership of lots sold in good faith by a private developer to innocent Santos[;] TCT No. 24069 issued in the name of Virginia dela Fuente containing an area of
purchasers for value. Notwithstanding its approval of the subdivision plan and its issuance 350 square meters[;] and TCT No. C-46648 issued in the name of defendant Lucy
of separate individual certificates of title thereto? Mandaya with an area of 350 square meters."[5]
"[On January 29, 1985, then Solicitor General Estelito Mendoza filed] an action seeking
The Case xxx the annulment and cancellation of Transfer Certificates of Title (TCT) Nos. 24015,
24017, 24018, 24020, 24021, 24024, 24025 and 24068 issued in the name of defendant
St. Jude's Enterprises, Inc.[;] Transfer Certificates of Title Nos. 13309 and C-43319 both
registered in the name of Sps. Catalino Santos and Thelma B. Santos[;] TCT No. 55513
These are the main questions raised in the Petition for Review before us, seeking to registered in the name of Sps. Domingo Calaguian and Felicidad de Jesus[;] TCT No.
set aside the November 29, 1993 Decision[1] of the Court of Appeals[2] in CA-GR CV No. 24069 registered in the name of Virginia dela Fuente[;] and TCT No. C-46648 registered in
34647. The assailed Decision affirmed the ruling[3] of the Regional Trial Court of Caloocan the name of Lucy Mandaya, principally on the ground that said Certificates of Title were
City, Branch 125, in Civil Case No. C-111708, which dismissed petitioners Complaint for issued on the strength of [a] null and void subdivision plan (LRC) PSD-55643 which
the cancellation of Transfer Certificates of Title (TCTs) to several lots in Caloocan City, expanded the original area of TCT No. 22660 in the name of St. Jude's Enterprises, Inc.
issued in the name of private respondents. from 40,623 square meters to 42,044 square meters upon its subdivision
In a Resolution[4] dated July 7, 1994, the Court of Appeals denied the Republics
motion for reconsideration. "Defendants Virginia dela Fuente and Lucy Mandaya were declared in default for failure to
file their respective answer within the reglementary period.
The Facts "Defendants Sps. Catalino Santos and Thelma Barreto Santos, St. Jude's Enterprises, Inc.
and Sps. Domingo Calaguian and Felicidad Calaguian filed separate answers to the
complaint. Defendants Sps. Domingo Calaguian and Sps. Catalino Santos interposed
defenses, among others, that they acquired the lots in question in good faith from their
The facts of the case are not disputed. The trial courts summary, which was adopted former owner, defendant St. Jude's Enterprises, Inc. and for value and that the titles issued
by the Court of Appeals, is reproduced below: to the said defendants were rendered incontrovetible, conclusive and indefeasible after
one year from the date of the issuance of the titles by the Register of Deeds of Caloocan
Defendant St. Judes Enterprises, Inc. is the registered owner of a parcel of land known as City.
Lot 865-B-1 of the subdivision plan (LRC) PSD-52368, being a portion of Lot 865-B located
in Caloocan City containing an area of 40,623 square meters. For Lot 865-B-1 defendant "On the other hand, defendant St. Jude's Enterprises, Inc. Interposed defenses, among
St. Judes Enterprises, Inc. was issued TCT No. 22660 on July 25, 1966. others, that the cause of action of plaintiff is barred by prior judgment; that the subdivision
plan submitted having been approved by the LRC, the government is now in estoppel to
Sometime in March 1966 defendant St Judes Enterprises, Inc. subdivided Lot No. 865-B-1 question the approved subdivision plan; and the plaintiff's allegation that the area of the
under subdivision plan (LRC) PSD-55643 and as a result thereof the Register of Deeds of subdivision increased by 1,421 square meters is without any basis in fact and in law."[6]
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
On April 30, 1991, the trial court dismissed the Complaint. [7] While the plaintiff The Issues
sufficiently proved the enlargement or expansion of the area of the disputed property, it
presented no proof that Respondent St. Jude Enterprises, Inc. (St. Jude) had committed
fraud when it submitted the subdivision plan to the Land Registration Commission (LRC)
for approval. Because the plan was presumed to have been subjected to investigation, In this petition, the Republic raises the following issues for our resolution:[12]
study and verification by the LRC, there was no one to blame for the increase in the area
but the plaintiff[,] for having allowed and approved the subdivision plan. Thus, the court 1. Whether or not the government is estopped from questioning the approved subdivision
concluded, the government was already in estoppel to question the approved subdivision plan which expanded the areas covered by the transfer certificates of title in question;
plan.
The trial court also took into account the absence of complaints from adjoining 2. Whether or not the Court of Appeals erred when it did not consider the Torrens System
owners whose supposed lots [were] encroached upon by the defendants, as well as the as merely a means of registering title to land;
fact that an adjoining owner had categorically stated that there was no such
encroachment. Finding that Spouses Santos, Spouses Calaguian, Dela Fuente and
3. Whether or not the Court of Appeals erred when it failed to consider that petitioners
Madaya had brought their respective lots from St. Jude for value and in good faith, the
complaint before the lower court was filed to preserve the integrity of the Torrens System.
court held that their titles could no longer be questioned, because under the Torrens
system, such titles had become absolute and irrevocable. As regards the Republics
allegation that it had filed the case to protect the integrity of the said system, the court said: We shall discuss the second and third questions together. Hence, the issues shall be
(1) the applicability of estoppel against the State and (2) the Torrens system.
xxx [S]ustaining the position taken by the government would certainly lead to disastrous
consequences. Buyers in good faith would lose their titles. Adjoining owners who were
deprived of a portion of their lot would be forced to accept the portion of the property The Courts Ruling
allegedly encroached upon. Actions for recovery will be filed right and left[;] thus instead of
preserving the integrity of the Torrens System it would certainly cause chaos rather than
stability. Finally, if only to strengthen the Torrens System and in the interest of justice, the
boundaries of the affected properties of the defendants should not be disturbed and the The petition is bereft of merit.
status quo should be maintained.[8]
The solicitor general appealed the trial courts Decision to the Court of Appeals. First Issue: Estoppel Against the Government
Ruling of the Appellate Court The general rule is that the State cannot be put in estoppel by the mistakes or error
of its officials or agents.[13] However, like all general rules, this is also subject to
exceptions, viz.:[14]
Citing several cases[9] upholding the indefeasibility of titles issued under the Torrens
system, the appellate court affirmed the trial court. It berated petitioner for bringing the suit Estoppels against the public are little favored. They should not be invoked except in rate
only after nineteen (19) years had passed since the issuance of St. Judes title and the and unusual circumstances, and may not be invoked where they would operate to defeat
approval of the subdivision plan. The pertinent portion of the assailed Decision reads: [10] 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
xxx Rather than make the Torrens system reliable and stable, [its] act of filing the instant dishonorably or capriciously with its citizens, and must not play an ignoble part or do a
suit rocks the system, as it gives the impression to Torrens title holders, like appellees, that shabby thing; and subject to limitations x x x, the doctrine of equitable estoppel may be
their titles to properties can be questioned by the same authority who had approved the invoked against public authorities as well as against private individuals.
same even after a long period of time. In that case, no Torrens title holder shall be at
peace with the ownership and possession of his land, for the Commission of land
Registration can question his title any time it makes a finding unfavorable to said Torrens
title holder.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
In Republic v. Sandiganbayan,[15] the government, in its effort to recover ill-gotten registered under the Torrens system would have to inquire in every instance whether the
wealth, tried to skirt the application of estoppel against it by invoking a specific title has been regularly issued or not. This would be contrary to the very purpose of the
constitutional provision.[16] The Court countered:[17] 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 therefor, and the law or the
We agree with the statement that the State is immune from estoppel, but this concept is courts do not oblige them to go behind the certificate in order to investigate again the true
understood to refer to acts and mistakes of its officials especially those which are irregular condition of the property. They are only charged with notice of the liens and encumbrances
(Sharp International Marketing vs. Court of Appeals, 201 SCRA 299; 306 [1991]; Republic on the property that are noted on the certificate. [22]
v. Aquino, 120 SCRA 186 [1983]), which peculiar circumstances are absent in the case at When private respondents-purchasers bought their lots from St. Jude, they did not
bar. Although the States right of action to recover ill-gotten wealth is not vulnerable to have to go behind the titles thereto to verify their contents or search for hidden defects or
estoppel[;] it is non sequitur to suggest that a contract, freely and in good faith executed inchoate rights that could defeat their rights to said lots. Although they were bound by liens
between the parties thereto is susceptible to disturbance ad infinitum. A different and encumbrances annotated on the titles, private respondents-purchasers could not have
interpretation will lead to the absurd scenario of permitting a party to unilaterally jettison a had notice of defects that only an inquiry beyond the face of the titles could have
compromise agreement which is supposed to have the authority of res judicata (Article satisfied.[23] The rationale for this presumption has been stated thus: [24]
2037, New Civil Code), and like any other contract, has the force of law between parties
thereto (Article 1159, New Civil Code; Hernaez vs. Kao, 17 SCRA 296 [1966]; 6 Padilla,
Civil Code Annotated, 7th ed., 1987, p. 711; 3 Aquino, Civil Code, 1990 ed., p. 463). xxx. The main purpose of the Torrens System is to avoid possible conflicts of title to real estate
and to facilitate transactions relative thereto by giving the public the right to rely upon the
face of a Torrens Certificate of Title and to dispense with the need of inquiring further,
The Court further declared that (t)he real office of the equitable norm of estoppel is except when the party concerned had actual knowledge of facts and circumstances that
limited to supply[ing] deficiency in the law, but it should not supplant positive law. [18] should impel a reasonably cautious man to make such further inquiry (Pascua v. Capuyoc,
In the case at bar, for nearly twenty years (starting from the issuance of St. 77 SCRA 78). Thus, where innocent third persons relying on the correctness of the
Judes titles in 1966 up to the filing of the Complaint in 1985), petitioner failed to correct certificate thus issued, acquire rights over the property, the court cannot disregard such
and recover the alleged increase in the land area of St. Jude. Its prolonged inaction rights (Director of Land v. Abache, et al., 73 Phil. 606).
strongly militates against its cause, as it is tantamount to laches, which means the failure
or neglect, for an unreasonable and unexplained length of time, to do that which by In another case,[25] this Court further said:
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 The Torrens System was adopted in this country because it was believed to be most
entitled to assert it either has abandoned it or declined to assert it. [19] effective measure to guarantee the integrity of land titles and to protect their indefeasibility
The Court notes private respondents argument that, prior to the subdivision, the once the claim of ownership is established and recognized. If a person purchases a piece
surveyors erred in the original survey of the whole tract of land covered by TCT No. of land on the assurance that the sellers title thereto is valid, he should not run the risk of
22660. So that less then the actual land area was indicated on the title. Otherwise, the being told later that his acquisition was ineffectual after all. This would not only be unfair to
adjoining owners would have complained upon the partition of the land in accordance with him. What is worse is that if this were permitted, public confidence in the system would be
the LRC-approved subdivision plan. As it is, Florencio Quintos, the owner of the 9,146 eroded and land transactions would have to be attended by complicated and not
square-meter Quintos Village adjoining the northern portion of St. Judes property (the necessarily conclusive investigations and proof of ownership. The further consequence
portion allegedly expanded), even attested on August 16, 1973 that there [was] no would be that land conflicts could be even more abrasive, if not even violent. The
overlapping of boundaries as per my approved plan (LRC) PSD 147766 dated September Government, recognizing the worthy purposes of the Torrens System, should be the first to
8, 1971.[20] None of the other neighboring owners ever complained against St. Jude or the accept the validity of titles issued thereunder once the conditions laid down by the law are
purchasers of its property. It is clear, therefore, that there was no actual damage to third satisfied. [Italics supplied.]
persons caused by the resurvey and the subdivision.
Petitioner never presented proof that the private respondents who had bought their
Significantly, the other private respondents -- Spouses Santos, Spouses Calaguian, lots from St. Jude were buyers in bad faith. Consequently, their claim of good faith
Dela Fuente and Madaya -- bought such expanded lots in good faith, relying on the clean prevails. A purchaser in good faith and for value is one who buys the property of another
certificates of St. Jude, which had no notice of any flaw in them either. It is only fair and without notice that some other person has a right to or an interest in such property; and
reasonable to apply the equitable principle of estoppel by laches against the government who pays a full and fair price for the same at the time of such purchase or before he or she
to avoid an injustice[21] to the innocent purchasers for value. has notice of the claims or interest of some other person. [26] Good faith is the honest
Likewise time-settled is the doctrine that where innocent third persons, relying on the intention to abstain from taking any unconscientious advantage of another.[27]
correctness of the certificate of title, acquire rights over the property, courts cannot Furthermore, it should be stressed that the total area of forty thousand six hundred
disregard such rights and order the cancellation of the certificate. Such cancellation would twenty-three (40,623) square meters indicated on St. Judes original title (TCT No. 22660)
impair public confidence in the certificate of title, for everyone dealing with property was not an exact area. Such figure was followed by the phrase more or less. This
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
plainlymeans that the land area indicated was not precise. Atty. Antonio H. Noblejas, who [h.] It is well settled that in the identification of a parcel of land covered by certificate of title,
became the counsel of St. Jude subsequent to his tenure as Land Registration what is controlling are the metes and bounds as set forth in its Technical Description and
Commissioner, offers a sensible explanation. In his letter[28] to the LRC dated November 8, not the area stated therein, which is merely an approximation as indicated in the more or
1982, he gave the following information: less phrase placed after the number of square meters.
a. Records show that our client owned a large tract of land situated in an area cutting the i. There is thus no unauthorized expansion of the survey occasioned by the subdivision of
boundary of Quezon City and Caloocan City, then known as Lot 865-B, Psd-60608, and Lot 865-B-1 under Plan (LRC) Psd-55643; consequently, LRC Circular No. 167, Series of
described in T.C.T. No. 100412, containing an area of 96,931 sq. meters, more or less. 1967, finds no application thereto, as to bar the processing and registration in due course
of transactions involving the subdivision lots of our client, subject hereof. This is apart from
b. It will be noted that on the northern portion of this Lot 865-B, Psd-60608, is xxx Lot 865- the fact that LRC Circular No. 167 has not been implemented by the Register of Deeds of
A, Psd-60608, which means that at a previous point of time, these 2 lots composed one Caloocan City or any proper government authority since its issuance in 1967, and that, in
whole tract of land. the interest of justice and equity, its restrictive and oppressive effect on transactions over
certificates of titles of subdivisions that allegedly expanded on re-surveys, cannot be
allowed to continue indefinitely. (Italics supplied.)
c. On December 23, 1965, Lot 865-B, Psd-60608, was subdivided into 2 lots, denominated
as Lot 865-B-1, with an area of 40,622 sq. meters, more or less, on the Caloocan side,
and Lot 865-B-2, with an area of 56,308 sq. meters, more or less, on the Quezon City side, The discrepancy in the figures could have been caused by the inadvertence or the
under Plan (LRC) Psd-52368. negligence of the surveyors. There is no proof, though, that the land area indicated was
intentionally and fraudulently increased. The property originally registered was the same
property that was subdivided. It is well-settled that what defines a piece of titled property is
d. On March 1-10, 1966, Lot 865-B-1, Psd-52368, then covered by T.C.T. No. N-22660, not the numerical date indicated as the area of the land, but the boundaries or metes and
was subdivided into residential lots under Plan (LRC) Psd-55643, with a total area of bounds of the property specified in its technical description as enclosing it and showing its
42,044 sq. meters, more or less. limits.[29]
Petitioner miserably failed to prove any fraud, either on the part of Private
e. It will be noted that Lot 865-B, Psd-60608, covered by T.C.T. No. 100412, contained an
Respondent St. Jude or on the part of land registration officials who had approved the
area of 96,931 sq. meters, more or less, but when subdivided under Plan (LRC) Psd-
subdivision plan and issued the questioned TCTs. Other than its peremptory statement in
52368, into 2 lots, its total area shrank by 1 sq. meter, to wit:
the Complaint that the expansion of the area was motivated by bad faith with intent to
defraud, to the damage and prejudice of the government and of public interests, petitioner
Lot 865-B-1, Psd-52368 = 40,622 sq. meters did not allege specifically how fraud was perpetrated to cause an increase in the actual
land size indicated. Nor was any evidence proffered to substantiate the allegation. That the
Lot 865-B-2, Psd-52368 = 56,308 land registration authorities supposedly erred or committed an irregularity was merely a
conclusion drawn from the table survey showing that the aggregate area of the subdivision
lots exceeded the area indicated on the title of the property before its subdivision. Fraud
96,930 sq. meters. cannot be presumed, and the failure of petitioner to prove it defeats it own cause.
f. There is no allegation whatever in the Perez report that there was error in laying out the
metes and bounds of Lot 865-B-1 in Plan (LRC) Psd-55643, as specified in the Technical Second Issue: The Torrens System
Description of the said lot set forth in T.C.T. No. N-22660 covering the same. There is
likewise no allegation, on the contrary there is confirmation from the boundary owner on
the northern side, Mr. Florencio Quintos, that there is no overlapping of boundaries on the
northern side of Lot 865-B-1, Psd-55643. True, the Torrens system is not a means of acquiring titles to lands; it is merely a
system of registration of titles to lands.[30] Consequently, land erroneously included in a
Torrens certificate of title is not necessarily acquired by the holder of such certificate. [31]
g. We respectfully submit that the area of 42, 044 sq. meters stated in Plan (LRC) Psd-
55643 as the size of Lot 865-B-a, is the more accurate area, confirmed by the Perez report But in the interest of justice and equity, neither may the titleholder be made to bear
as per surveyor[]s findings on the ground, which rectifies previous surveryors error the unfavorable effect of the mistake or negligence of the States agents, in the absence of
in computing its area as 40,622 sq. meters in Plan (LRC) Psd-52368, which is about 3.5% proof of his complicity in a fraud or of manifest damage to third persons. First, the real
tolerable error (1,422 divided by 40,622 = .035). purpose of the Torrens system is to quite 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. [32] Second, as we discussed earlier,
estoppel by laches now bars petitioner from questioning private respondents titles to the
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
subdivision lots. Third, it was never proven that Private Respondent St. Jude was a party G.R. No. 83432 May 20, 1991
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 RADIOWEALTH FINANCE COMPANY, petitioner,
might have been committed by its agent who had surveyed the property, the presumption
vs.
of regularity in the performance of their functions must be respected. Otherwise, the MANUELITO S. PALILEO, respondent.
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. [33] Rolando A. Calang for petitioner.
Sisenando Villaluz, Sr. for respondent.
We cannot, therefore, adhere to the petitioners submission that, in filing this suit, it
seeks to preserve the integrity of the Torrens system. To the contrary, it is rather evident
from our foregoing discussion that petitioners action derogates the very integrity of the
system.Time and again, we have said that a Torrens certificate is evidence of an
indefeasible title to property in favor of the person whose name appears thereon.
GANCAYCO, J.:
WHEREFORE, the petition is hereby DENIED and the assailed Decision
is AFFIRMED.
If the same piece of land was sold to two different purchasers, to whom shall ownership
SO ORDERED. belong? Article 1544 of the Civil Code provides that in case of double sale of an
immovable property, ownership shall be transferred: (1) to the person acquiring it who in
good faith first recorded it in the Registry of Property; (2) in default thereof, to the person
who in good faith was first in possession; and (3) in default thereof, to the person who
presents the oldest title, provided there is good faith. There is no ambiguity regarding the
application of the law with respect to lands registered under the Torrens System. Section
51 of Presidential Decree No. 1529 (amending Section 50 of Act No. 496 clearly provides
that the act of registration is the operative act to convey or affect registered lands insofar
as third persons are concerned. Thus, a person dealing with registered land is not required
to go behind the register to determine the condition of the property. He is only charged with
notice of the burdens on the property which are noted on the face of the register or
certificate of title.1 Following this principle, this Court has time and again held that a
purchaser in good faith of registered land (covered by a Torrens Title) acquires a good title
as against all the transferees thereof whose right is not recorded in the registry of deeds at
the time of the sale.2
The question that has to be resolved in the instant petition is whether or not the rule
provided in Article 1544 of the Civil Code as discussed above, is applicable to a parcel of
unregistered land purchased at a judicial sale. To be more specific, this Court is asked to
determine who, as between two buyers of unregistered land, is the rightful ownerthe first
buyer in a prior sale that was unrecorded, or the second buyer who purchased the land in
an execution sale whose transfer was registered in the Register of Deeds.
On April 13, 1970, defendant spouses Enrique Castro and Herminia R. Castro
sold to plaintiff-appellee Manuelito Palileo (private respondent herein), a parcel of
unregistered coconut land situated in Candiis, Mansayaw, Mainit, Surigao del
Norte. The sale is evidenced by a notarized Deed of Absolute Sale (Exh. "E").
The deed was not registered in the Registry of Property for unregistered lands in
the province of Surigao del Norte. Since the execution of the deed of sale,
appellee Manuelito Palileo who was then employed at Lianga Surigao del Sur,
exercised acts of ownership over the land through his mother Rafaela Palileo, as
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
administratrix or overseer. Appellee has continuously paid the real estate taxes There is no substantive proof to support petitioner's allegation that the document is
on said land from 1971 until the present (Exhs. "C" to "C-7", inclusive). fictitious or simulated. With this in mind, We see no reason to reject the conclusion of the
Court of Appeals that private respondent was not a mere administrator of the property.
That he exercised acts of ownership through his mother also remains undisputed.
On November 29, 1976, a judgment was rendered against defendant Enrique T.
Castro, in Civil Case No. 0103145 by the then Court of First Instance of Manila,
Branch XIX, to pay herein defendant-appellant Radiowealth Finance Company Going now to the third assigned error which deals with the main issue presented in the
(petitioner herein), the sum of P22,350.35 with interest thereon at the rate of instant petition, We observe that the Court of Appeals resolved the same in favor of private
16% per annum from November 2, 1975 until fully paid, and the further sum of respondent due to the following reason; what the Provincial Sheriff levied upon and sold to
P2,235.03 as attorney's fees, and to pay the costs. Upon the finality of the petitioner is a parcel of land that does not belong to Enrique Castro, the judgment debtor,
judgment, a writ of execution was issued. Pursuant to said writ, defendant hence the execution is contrary to the directive contained in the writ of execution which
provincial Sheriff Marietta E. Eviota, through defendant Deputy Provincial Sheriff commanded that the lands and buildings belonging to Enrique Castro be sold to satisfy the
Leopoldo Risma, levied upon and finally sold at public auction the subject land execution.5
that defendant Enrique Castro had sold to appellee Manuelito Palileo on April
13,1970. A certificate of sale was executed by the Provincial Sheriff in favor of There is no doubt that had the property in question been a registered land, this case would
defendant- appellant Radiowealth Finance Company, being the only bidder. After have been decided in favor of petitioner since it was petitioner that had its claim first
the period of redemption has (sic) expired, a deed of final sale was also executed recorded in the Registry of Deeds. For, as already mentioned earlier, it is the act of
by the same Provincial Sheriff. Both the certificate of sale and the deed of final
registration that operates to convey and affect registered land. Therefore, a bona
sale were registered with the Registry of Deeds. 3 fide purchaser of a registered land at an execution sale acquires a good title as against a
prior transferee, if such transfer was unrecorded.
Learning of what happened to the land, private respondent Manuelito Palileo filed an
action for quieting of title over the same. After a trial on the merits, the court a
However, it must be stressed that this case deals with a parcel of unregistered land and a
quo rendered a decision in his favor. On appeal, the decision of the trial court was different set of rules applies. We affirm the decision of the Court of Appeals.
affirmed. Hence, this petition for review on certiorari.
Under Act No. 3344, registration of instruments affecting unregistered lands is "without
In its petition, Radiowealth Finance Company presents the following errors:
prejudice to a third party with a better right". The aforequoted phrase has been held by this
Court to mean that the mere registration of a sale in one's favor does not give him any right
1. THE COURT OF APPEALS ERRED IN NOT FINDING THAT THE DEED OF over the land if the vendor was not anymore the owner of the land having previously sold
ABSOLUTE SALE (EXHIBIT B) ALLEGEDLY EXECUTED BY ENRIQUE the same to somebody else even if the earlier sale was unrecorded.
CASTRO IN FAVOR OF APPELLEE MANUELITO PALILEO, WAS SIMULATED
OR FICTITIOUS. The case of Carumba vs. Court of Appeals6 is a case in point. It was held therein that
Article 1544 of the Civil Code has no application to land not registered under Act No. 496.
2. THE COURT OF APPEALS ERRED IN NOT FINDING APPELLEE Like in the case at bar, Carumba dealt with a double sale of the same unregistered land.
MANUELITO PALILEO AS ADMINISTRATOR ONLY OF THE DISPUTED The first sale was made by the original owners and was unrecorded while the second was
PROPERTY; AND an execution sale that resulted from a complaint for a sum of money filed against the said
original owners. Applying Section 35, Rule 39 of the Revised Rules of Court, 7 this Court
3. THE COURT OF APPEALS ERRED IN NOT FINDING DEFENDANT- held that Article 1544 of the Civil Code cannot be invoked to benefit the purchaser at the
execution sale though the latter was a buyer in good faith and even if this second sale was
APPELLANT RADIOWEALTH FINANCE COMPANY OWNER OF THE
DISPUTED PROPERTY BY REASON OF THE CERTIFICATE OF SALE AND registered. It was explained that this is because the purchaser of unregistered land at a
THE DEED OF FINAL SALE WHICH WERE ALL REGISTERED IN THE sheriffs execution sale only steps into the shoes of the judgment debtor, and merely
REGISTER OF DEEDS, HENCE, SUPERIOR TO THAT OF THE DEED OF acquires the latter's interest in the property sold as of the time the property was levied
SALE IN POSSESSION OF MANUELITO PALILEO, FOR BEING NOT upon.
REGISTERED.4
Applying this principle, the Court of Appeals correctly held that the execution sale of the
As regards the first and second assigned errors, suffice it to state that findings of fact of unregistered land in favor of petitioner is of no effect because the land no longer belonged
the Court of Appeals are conclusive on this Court and will not be disturbed unless there is to the judgment debtor as of the time of the said execution sale.
grave abuse of discretion. The finding of the Court of Appeals that the property in question
was already sold to private respondent by its previous owner before the execution sale is WHEREFORE, in view of the foregoing, the decision of the Court of Appeals in CA-G.R.
evidenced by a deed of sale. Said deed of sale is notarized and is presumed authentic. CV No. 10788 is hereby AFFIRMED. No costs. SO ORDERED.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
G.R. No. 181359 August 5, 2013 On April 11, 2000, Juanito, through his attorney-in-fact Domingo Jr., filed Civil Case No. B-
109712 for quieting of title and preliminary injunction, against herein petitioners Atty.
SPOUSES CLEMENCIO C. SABITSANA, JR. and MA. ROSARIO M. Sabitsana and his wife, Rosario, claiming that they bought the lot in bad faith and are
exercising acts of possession and ownership over the same, which acts thus constitute a
SABITSANA, Petitioners,
vs. cloud over his title. The Complaint13 prayed, among others, that the Sabitsana Deed of
JUANITO F. MUERTEGUI, represented by his Attorney-in-Fact DOMINGO A. Sale, the August 24, 1998 letter, and TD No. 5327 be declared null and void and of no
MUERTEGUI, JR., Respondent. effect; that petitioners be ordered to respect and recognize Juanitos title over the lot; and
that moral and exemplary damages, attorneys fees, and litigation expenses be awarded to
him.
DECISION
In their Answer with Counterclaim,14 petitioners asserted mainly that the sale to Juanito is
DEL CASTILLO, J.: null and void absent the marital consent of Garcias wife, Soledad Corto (Soledad); that
they acquired the property in good faith and for value; and that the Complaint is barred by
A lawyer may not, for his own personal interest and benefit, gamble on his client's word, prescription and laches. They likewise insisted that the Regional Trial Court (RTC) of
believing it at one time and disbelieving it the next. He owes his client his undivided loyalty. Naval, Biliran did not have jurisdiction over the case, which involved title to or interest in a
parcel of land the assessed value of which is merely 1,230.00.
Assailed in this Petition for Review on Certiorari 1 are the January 25, 2007 Decision2 of the
Court of Appeals (CA) which denied the appeal in CA-G.R. CV No. 79250, and its January The evidence and testimonies of the respondents witnesses during trial reveal that
11, 2008 Resolution3 denying petitioners Motion for Reconsideration.4 petitioner Atty. Sabitsana was the Muertegui familys lawyer at the time Garcia sold the lot
to Juanito, and that as such, he was consulted by the family before the sale was executed;
that after the sale to Juanito, Domingo Sr. entered into actual, public, adverse and
Factual Antecedents continuous possession of the lot, and planted the same to coconut and ipil-ipil; and that
after Domingo Sr.s death, his wife Caseldita, succeeded him in the possession and
On September 2, 1981, Alberto Garcia (Garcia) executed an unnotarized Deed of Sale 5 in exercise of rights over the lot.
favor of respondent Juanito Muertegui6 (Juanito) over a 7,500-square meter parcel of
unregistered land (the lot) located in Dalutan Island, Talahid, Almeira, Biliran, Leyte del On the other hand, Atty. Sabitsana testified that before purchasing the lot, he was told by a
Norte covered by Tax Declaration (TD) No. 1996 issued in 1985 in Garcias name. 7 member of the Muertegui family, Carmen Muertegui Davies (Carmen), that the Muertegui
family had bought the lot, but she could not show the document of sale; that he then
Juanitos father Domingo Muertegui, Sr. (Domingo Sr.) and brother Domingo Jr. took conducted an investigation with the offices of the municipal and provincial assessors; that
actual possession of the lot and planted thereon coconut and ipil-ipil trees. They also paid he failed to find any document, record, or other proof of the sale by Garcia to Juanito, and
the real property taxes on the lot for the years 1980 up to 1998. instead discovered that the lot was still in the name of Garcia; that given the foregoing
revelations, he concluded that the Muerteguis were merely bluffing, and that they probably
did not want him to buy the property because they were interested in buying it for
On October 17, 1991, Garcia sold the lot to the Muertegui family lawyer, petitioner Atty. themselves considering that it was adjacent to a lot which they owned; that he then
Clemencio C. Sabitsana, Jr. (Atty. Sabitsana), through a notarized deed of absolute proceeded to purchase the lot from Garcia; that after purchasing the lot, he wrote
sale.8 The sale was registered with the Register of Deeds on February 6, 1992. 9 TD No. Caseldita in October 1991 to inform her of the sale; that he then took possession of the lot
1996 was cancelled and a new one, TD No. 5327,10 was issued in Atty. Sabitsanas name. and gathered ipil-ipil for firewood and harvested coconuts and calamansi from the lot; and
Although Domingo Jr. and Sr. paid the real estate taxes, Atty. Sabitsana also paid real that he constructed a rip-rap on the property sometime in 1996 and 1997.
property taxes in 1992, 1993, and 1999. In 1996, he introduced concrete improvements on
the property, which shortly thereafter were destroyed by a typhoon.
Ruling of the Regional Trial Court
When Domingo Sr. passed away, his heirs applied for registration and coverage of the lot
under the Public Land Act or Commonwealth Act No. 141. Atty. Sabitsana, in a On October 28, 2002, the trial court issued its Decision 15 which decrees as follows:
letter11 dated August 24, 1998 addressed to the Department of Environment and Natural
Resources CENRO/PENRO office in Naval, Biliran, opposed the application, claiming that WHEREFORE, in view of the foregoing considerations, this Court finds in favor of the
he was the true owner of the lot. He asked that the application for registration be held in plaintiff and against the defendants, hereby declaring the Deed of Sale dated 2 September
abeyance until the issue of conflicting ownership has been resolved. 1981 as valid and preferred while the Deed of Absolute Sale dated 17 October 1991 and
Tax Declaration No. 5327 in the name of Atty. Clemencio C. Sabitsana, Jr. are VOID and
of no legal effect.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
The Provincial Assessor and the Municipal Assessor of Naval are directed to cancel Tax The CA added that the fact that the Deed of Sale in favor of Juanito was not notarized
Declaration No. 5327 as void and done in bad faith. could not affect its validity. As against the notarized deed of sale in favor of petitioners, the
CA held that the sale in favor of Juanito still prevails. Applying Article 1544 of the Civil
Code, the CA said that the determining factor is petitioners good faith, or the lack of it. It
Further, Atty. Clemencio C. Sabitsana, Jr. is ordered to pay plaintiff Juanito Muertigui,
represented by his attorney-in-fact Domingo Muertigui, Jr. the amounts of: held that even though petitioners were first to register the sale in their favor, they did not
do so in good faith, for they already knew beforehand of Garcias prior sale to Juanito. By
virtue of Atty. Sabitsanas professional and confidential relationship with the Muertegui
a) 30,000.00 as attorneys fees; family, petitioners came to know about the prior sale to the Muerteguis and the latters
possession of the lot, and yet they pushed through with the second sale. Far from acting in
b) 10,000.00 as litigation expenses; and good faith, petitioner Atty. Sabitsana used his legal knowledge to take advantage of his
clients by registering his purchase ahead of them.
c) Costs.
Finally, the CA declared that Juanito, as the rightful owner of the lot, possessed the
16
requisite cause of action to institute the suit for quieting of title and obtain judgment in his
SO ORDERED. favor, and is entitled as well to an award for attorneys fees and litigation expenses, which
the trial court correctly held to be just and equitable under the circumstances.
The trial court held that petitioners are not buyers in good faith. Petitioner Atty. Sabitsana
was the Muertegui familys lawyer, and was informed beforehand by Carmen that her The dispositive portion of the CA Decision reads:
family had purchased the lot; thus, he knew of the sale to Juanito. After conducting an
investigation, he found out that the sale was not registered. With this information in mind,
Atty. Sabitsana went on to purchase the same lot and raced to register the sale ahead of WHEREFORE, premises considered, the instant appeal is DENIED and the Decision
the Muerteguis, expecting that his purchase and prior registration would prevail over that of dated October 28, 2002 of the Regional Trial Court, 8th Judicial Region, Branch 16, Naval,
his clients, the Muerteguis. Applying Article 1544 of the Civil Code,17 the trial court Biliran, is hereby AFFIRMED. Costs against defendants-appellants.
declared that even though petitioners were first to register their sale, the same was not
done in good faith. And because petitioners registration was not in good faith, preference SO ORDERED.23
should be given to the sale in favor of Juanito, as he was the first to take possession of the
lot in good faith, and the sale to petitioners must be declared null and void for it casts a
Issues
cloud upon the Muertegui title.
Ruling of the Court of Appeals I. THE COURT OF APPEALS ERRED IN NOT HOLDING THAT THE
REGIONAL TRIAL COURT DID NOT HAVE JURISDICTION OVER THE CASE
IN VIEW OF THE FACT THAT THE ASSESSED VALUE OF THE SUBJECT
Petitioners appealed to the CA20 asserting that the sale to Juanito was null and void for LAND WAS ONLY 1,230.00 (AND STATED MARKET VALUE OF ONLY
lack of marital consent; that the sale to them is valid; that the lower court erred in applying 3,450.00).
Article 1544 of the Civil Code; that the Complaint should have been barred by prescription,
laches and estoppel; that respondent had no cause of action; that respondent was not
entitled to an award of attorneys fees and litigation expenses; and that they should be the II. THE COURT OF APPEALS ERRED IN APPLYING ART. 1544 OF THE CIVIL
ones awarded attorneys fees and litigation expenses. CODE INSTEAD OF THE PROPERTY REGISTRATION DECREE (P.D. NO.
1529) CONSIDERING THAT THE SUBJECT LAND WAS UNREGISTERED.
The CA, through its questioned January 25, 2007 Decision, 21 denied the appeal and
affirmed the trial courts Decision in toto. It held that even though the lot admittedly was III. THE COURT OF APPEALS ERRED IN NOT HOLDING THAT THE
conjugal property, the absence of Soledads signature and consent to the deed did not COMPLAINT WAS ALREADY BARRED [BY] LACHES AND THE STATUTE OF
LIMITATIONS.
render the sale to Juanito absolutely null and void, but merely voidable. Since Garcia and
his wife were married prior to the effectivity of the Family Code, Article 173 of the Civil
Code22should apply; and under the said provision, the disposition of conjugal property IV. THE COURT OF APPEALS ERRED IN AFFIRMING THE DECISION OF
without the wifes consent is not void, but merely voidable. In the absence of a decree THE REGIONAL TRIAL COURT ORDERING THE PETITIONERS TO PAY
annulling the deed of sale in favor of Juanito, the same remains valid. ATTORNEYS FEES AND LITIGATION EXPENSES TO THE RESPONDENT.24
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Petitioners Arguments his rights over the lot, having previously filed a complaint for recovery of the lot, which
unfortunately was dismissed based on technicality.
Petitioners assert that the RTC of Naval, Biliran did not have jurisdiction over the case.
They argue that since the assessed value of the lot was a mere 1,230.00, jurisdiction On the issue of attorneys fees and litigation expenses, respondent finds refuge in Article
over the case lies with the first level courts, pursuant to Republic Act No. 7691, 25 which 2208 of the Civil Code,28 citing three instances which fortify the award in his favor
expanded their exclusive original jurisdiction to include "all civil actions which involve title petitioners acts compelled him to litigate and incur expenses to protect his interests; their
to, or possession of, real property, or any interest therein where the assessed value of the gross and evident bad faith in refusing to recognize his ownership and possession over the
property or interest therein does not exceed Twenty thousand pesos (20,000.00) or, in lot; and the justness and equitableness of his case.
civil actions in Metro Manila, where such assessed value does not exceed Fifty thousand
pesos (50,000.00) exclusive of interest, damages of whatever kind, attorneys fees, Our Ruling
litigation expenses and costs."26 Petitioners thus conclude that the Decision in Civil Case
No. B-1097 is null and void for lack of jurisdiction.
The Petition must be denied.
Petitioners next insist that the lot, being unregistered land, is beyond the coverage of
Article 1544 of the Civil Code, and instead, the provisions of Presidential Decree (PD) No. The Regional Trial Court has jurisdiction over the suit for quieting of title.
1529 should apply. This being the case, the Deed of Sale in favor of Juanito is valid only
as between him and the seller Garcia, pursuant to Section 113 of PD 1529; 27 it cannot On the question of jurisdiction, it is clear under the Rules that an action for quieting of title
affect petitioners who are not parties thereto. may be instituted in the RTCs, regardless of the assessed value of the real property in
dispute. Under Rule 63 of the Rules of Court, 29 an action to quiet title to real property or
On the issue of estoppel, laches and prescription, petitioners insist that from the time they remove clouds therefrom may be brought in the appropriate RTC.
informed the Muerteguis in writing about their purchase of the lot, or in October 1991, the
latter did not notify them of their prior purchase of the lot, nor did respondent interpose any It must be remembered that the suit for quieting of title was prompted by petitioners
objection to the sale in their favor. It was only in 1998 that Domingo Jr. showed to August 24, 1998 letter-opposition to respondents application for registration. Thus, in
petitioners the unnotarized deed of sale. According to petitioners, this seven-year period of order to prevent30 a cloud from being cast upon his application for a title, respondent filed
silence and inaction on the Muerteguis part should be taken against them and construed Civil Case No. B-1097 to obtain a declaration of his rights. In this sense, the action is one
as neglect on their part to assert their rights for an unreasonable length of time. As such, for declaratory relief, which properly falls within the jurisdiction of the RTC pursuant to Rule
their action to quiet title should be deemed barred by laches and estoppel. 63 of the Rules.
Lastly, petitioners take exception to the award of attorneys fees and litigation expenses, Article 1544 of the Civil Code does not apply to sales involving unregistered land.
claiming that since there was no bad faith on their part, such award may not be considered
just and equitable under the circumstances. Still, an award of attorneys fees should
remain the exception rather than the rule; and in awarding the same, there must have Both the trial court and the CA are, however, wrong in applying Article 1544 of the Civil
been an express finding of facts and law justifying such award, a requirement that is Code. Both courts seem to have forgotten that the provision does not apply to sales
absent in this case. involving unregistered land. Suffice it to state that the issue of the buyers good or bad faith
is relevant only where the subject of the sale is registered land, and the purchaser is
buying the same from the registered owner whose title to the land is clean. In such case,
Petitioners thus pray for the reversal of the questioned CA Decision and Resolution; the the purchaser who relies on the clean title of the registered owner is protected if he is a
dismissal of the Complaint in Civil Case No. B-1097; the deletion of the award of attorneys purchaser in good faith for value.31
fees and litigation expenses in respondents favor; and a declaration that they are the true
and rightful owners of the lot.
Act No. 3344 applies to sale of unregistered lands.
Respondents Arguments
What applies in this case is Act No. 3344, 32 as amended, which provides for the system of
recording of transactions over unregistered real estate. Act No. 3344 expressly declares
Respondent, on the other hand, counters that a suit for quieting of title is one whose that any registration made shall be without prejudice to a third party with a better right. The
subject matter is incapable of pecuniary estimation, and thus falls within the jurisdiction of question to be resolved therefore is: who between petitioners and respondent has a better
the RTC. He likewise insists that Article 1544 applies to the case because there is a clear right to the disputed lot?
case of double sale of the same property to different buyers, and the bottom line thereof
lies in petitioners lack of good faith in entering into the subsequent sale. On the issue of
laches/estoppel, respondent echoes the CAs view that he was persistent in the exercise of Respondent has a better right to the lot.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
The sale to respondent Juanito was executed on September 2, 1981 via an unnotarized Petitioner Atty. Sabitsana took advantage of confidential information disclosed to him by
deed of sale, while the sale to petitioners was made via a notarized document only on his client, using the same to defeat him and beat him to the draw, so to speak. He rushed
October 17, 1991, or ten years thereafter. Thus, Juanito who was the first buyer has a the sale and registration thereof ahead of his client. He may not be afforded the excuse
better right to the lot, while the subsequent sale to petitioners is null and void, because that he nonetheless proceeded to buy the lot because he believed or assumed that the
when it was made, the seller Garcia was no longer the owner of the lot. Nemo dat quod Muerteguis were simply bluffing when Carmen told him that they had already bought the
non habet. same; this is too convenient an excuse to be believed. As the Muertegui family lawyer, he
had no right to take a position, using information disclosed to him in confidence by his
The fact that the sale to Juanito was not notarized does not alter anything, since the sale client, that would place him in possible conflict with his duty. He may not, for his own
between him and Garcia remains valid nonetheless. Notarization, or the requirement of a personal interest and benefit, gamble on his clients word, believing it at one time and
public document under the Civil Code,33 is only for convenience, and not for validity or disbelieving it the next. He owed the Muerteguis his undivided loyalty. He had the duty to
enforceability.34 And because it remained valid as between Juanito and Garcia, the latter protect the client, at all hazards and costs even to himself.38
no longer had the right to sell the lot to petitioners, for his ownership thereof had ceased.
Petitioner Atty. Sabitsana is enjoined to "look at any representation situation from the point
Nor can petitioners registration of their purchase have any effect on Juanitos rights. The of view that there are possible conflicts, and further to think in terms of impaired loyalty,
mere registration of a sale in ones favor does not give him any right over the land if the that is, to evaluate if his representation in any way will impair his loyalty to a client." 39
vendor was no longer the owner of the land, having previously sold the same to another
even if the earlier sale was unrecorded. 35 Neither could it validate the purchase thereof by Moreover, as the Muertegui familys lawyer, Atty. Sabitsana was under obligation to
petitioners, which is null and void. Registration does not vest title; it is merely the evidence safeguard his client's property, and not jeopardize it. Such is his duty as an attorney, and
of such title. Our land registration laws do not give the holder any better title than what he pursuant to his general agency.40
actually has.36
Even granting that Atty. Sabitsana has ceased to act as the Muertegui family's lawyer, he
Specifically, we held in Radiowealth Finance Co. v. Palileo 37 that: still owed them his loyalty.1wphi1 The termination of attorney-client relation provides no
justification for a lawyer to represent an interest adverse to or in conflict with that of the
Under Act No. 3344, registration of instruments affecting unregistered lands is without former client on a matter involving confidential information which the lawyer acquired when
he was counsel. The client's confidence once reposed should not be divested by mere
prejudice to a third party with a better right. The aforequoted phrase has been held by this
Court to mean that the mere registration of a sale in ones favor does not give him any expiration of professional employment. 41 This is underscored by the fact that Atty.
Sabitsana obtained information from Carmen which he used to his advantage and to the
right over the land if the vendor was not anymore the owner of the land having previously
sold the same to somebody else even if the earlier sale was unrecorded. detriment of his client.
Petitioners defense of prescription, laches and estoppel are unavailing since their claim is from the foregoing disquisition, it can be seen that petitioners are guilty of bad faith in
pursuing the sale of the lot despite being apprised of the prior sale in respondent's favor.
based on a null and void deed of sale. The fact that the Muerteguis failed to interpose any
objection to the sale in petitioners favor does not change anything, nor could it give rise to Moreover, petitioner Atty. Sabitsana has exhibited a lack of loyalty toward his clients, the
Muerteguis, and by his acts, jeopardized their interests instead of protecting them. Over
a right in their favor; their purchase remains void and ineffective as far as the Muerteguis
are concerned. and above the trial court's and the CA's findings, this provides further justification for the
award of attorney's fees, litigation expenses and costs in favor of the respondent.
The award of attorneys fees and litigation expenses is proper because of petitioners bad
Thus said, judgment must be rendered in favor of respondent to prevent the petitioners'
faith.
void sale from casting a cloud upon his valid title.
Petitioners actual and prior knowledge of the first sale to Juanito makes them purchasers
in bad faith. It also appears that petitioner Atty. Sabitsana was remiss in his duties as WHEREFORE, premises considered, the Petition is DENIED. The January 25, 2007
Decision and the January 11, 2008 Resolution of the Court of Appeals in CA-G.R. CV No.
counsel to the Muertegui family. Instead of advising the Muerteguis to register their
purchase as soon as possible to forestall any legal complications that accompany 79250 are AFFIRMED. Costs against petitioners.
unregistered sales of real property, he did exactly the opposite: taking advantage of the
situation and the information he gathered from his inquiries and investigation, he bought SO ORDERED.
the very same lot and immediately caused the registration thereof ahead of his clients,
thinking that his purchase and prior registration would prevail. The Court cannot tolerate
this mercenary attitude. Instead of protecting his clients interest, Atty. Sabitsana practically
preyed on him.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
G.R. No. L-24736 January 29, 1926 Observing that this notation was not signed by the registrar, and that the certificate of sale
was not endorse on its margin, the attorneys for the plaintiff in the writ called upon the
CONSULTA NO. 441 DE LOS ABOGADOS DE SMITH, BELL AND CO., LTD., BLOCK, registrar of deeds, who then added in parenthesis, following the inscription, the words "no
vale." In May, 1925, the sheriff delivered to the plaintiff his original certificate of sale
JOHNSTON AND GREENBAUM, appellants,
vs. endorsed as follows:
THE REGISTER OF DEEDS OF LEYTE, appellee.
The foregoing sheriff's certificate of sale having been presented at 7.30 a.m. on
May 29, 1924, its inscription is denied for the reason that the property, with all the
Block, Johnston and Greenbaum; Ross, Lawrence and Selph and Antonio T. Carrascoso,
Jr, for appellant Smith, Bell and Co. improvements described in the said certificate, is registered in the name of a
Attorney-General Jaranilla for appellee. person other than any of the judgment debtors, Teofilo Mejia and Casilda
Martinez de Mejia (see the fourth parcel in the inscription No. 57, pp. 57 to 59, of
book 1, of inscriptions under Act No. 2837). Tacloban, Leyte, May 7, 1925.
STATEMENT
A letter setting out the foregoing facts was then addressed to the Chief of the General
For a purported consideration of P78,000, Teofilo Mejia and Casilda Martinez de Mejia Land Registration Office, who in turn submitted it to the Judge of the Fourth Branch of the
signed a deed of sale and in favor of Cristina Martinez for four parcels of land in Ormoc, Court of First Instance of Manila, who held, first, that after the filing of the affidavits, there
Leyte, and certain personal property. April 26, 1921, the deed was presented for was no error in registering the original deed, and, second, that the registrar had the legal
registration under Act No. 2837 to the registrar of deeds of the Province of Leyte, and right to refuse to inscribe the sheriff's certificate of sale for property sold at public auction
owing to certain defects in it, registration was refused. June 7, 1921, Teofilo Mejia made which was not registered in the name of the judgment debtor, but in the name of a third
an amendatory affidavit of her husband. On August 12 1921, the property was then party, and third, refused to order registration of the deed to plaintiff in the writ, which was
registered as inscription No. 57 in the register of lands not registered under Act No. 496. executed by the sheriff under sections 429 and 466 of Act No. 190. From this ruling, the
Thereafter Smith, Bell and Co. commenced an action, known as civil case No. 4030, in the plaintiff appeals, assigning the following errors:
Court of First Instance of Cebu against Teofilo Mejia and Casilda Martinez de Mejia,
defendants., and grantors in the deed, to recover the sum of P14,000, in which a writ of
attachment was issued, and on April 18, 1923, it was levied upon the four parcels of land The court erred:
described in the deed of Cristina Martinez. A record of this certificate of attachment
appears under paragraph 16 of inscription No. 57 of the deed to Cristina Martinez In the 1. In finding that defects in a original conveyance presented for registration under
ordinary course of business, judgment was rendered against the defendants, and an order Act No. 2837, (amending Act No. 2711, sec.. 1940, can be cured by affidavit
of sale of the four parcels of land, and execution was issued, and on February 15, 1924, alone.
the fourth parcel of land described in the deed was levied upon by the sheriff to satisfy the
judgment, and that fact was also noted under paragraph 16 of inscription No 57 of the 2. In holding that a registrar of deeds may refuse to register a sheriff's deed of
deed. After the levy was made and the property advertised for sale, Cristina Martinez, the
sale, on the ground that the property sold stands inscribed in the registry book for
vendee in the deed, entered a terceria with the sheriff, claiming that the property unregistered real estate in the name of some person other than the judgment
advertised for sale was her sole property. The sheriff required Smith, Bell and Co. to give
debtor.
him an indemnity bond in the sum of P150,000 as a condition precedent to the making of
the sale. The bond was furnished, and the property sold, and in due course, the sheriff
executed and presented a certificate of sale to the registrar for inscription, which was duly 3. In failing to order the registrar of deeds of Leyte (1) to annul inscription No. 57
inscribed in the registry under inscription No. 57 as follows: in his register under Act No. 2837; or (if the inscription be held valid) (2) to
require the said registrar to record the sheriff's certificate of sale.
The fourth parcel described in this inscription, together with all the improvements
thereon, was sold at public auction by the sheriff of Leyte, by order of the Court
of First Instance of Cebu (civil case No. 4030), for the best bidder, this property
being subject to repurchase by the judgment debtor in the said case within the JOHNS, J.:
period of one year from May 21st of this year. All the aforementioned is
contained in the certificate of sale dated May 21, 1924, issued by the sheriff of
Leyte and presented to this registry at 7. 30 a. m. f May 29, 1924. Tacloban, Upon the facts, we are clearly of the opinion that there is no merit in the first assignment of
June 5, 1924. error. As the Attorney-General points out, there was no material defect in the conveyance
itself, because the instrument was regular on its face, valid in substance, and had all of the
requirements provided for in section 127 of Act No. 496, as amended. Nothing was
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
conveyed by the affidavits which were simply furnished for the purpose of conforming to And section 463 provides:
the requirements of the entries to be made in the registry book.
Upon a sale of real property, the purchaser shall be substituted to, and acquire
As to the second assignment of error, it will be noted that, although the deed of sale was all the right, interest, title, and claim of the judgment debtor thereto, subject to the
duly registered on August 12, 1921, that on April 18, 1923, the land therein described was right of redemption as hereinafter provided. The officer must give to the
attached as the property of the grantors in the deed. That later judgment was obtained in purchaser a certificate of sale containing:
the attachment proceedings, execution was issued, and that the fourth parcel of land
described in the deed was advertised for sale when the grantees notified the sheriff that it
1. A particular description of the real property sold;
was their sole and exclusive property. The sheriff then demanded the indemnity bond from
the plaintiff in the writ, which was furnished, and the fourth parcel of land was then sold by
the sheriff to Smith, Bell and Co. as purchaser for the sum of P20,000. Later, a certificate 2. The price paid for each distinct lot or parcel;
of sale was issued and the sale confirmed, and the sheriff's deed was executed.
3. The whole price by him paid;
Section 429 of the Code of Civil Procedure provides:
4. The date when the right of redemption expires.
Real property, standing upon the records in the name of the defendant or not
appearing at all upon the record, shall be attached by filing with the registrar of When the judgment under which the sale has been made is made payable in a
titles of land, for the province in which the land is situated, a copy of the order of specified kind of money or currency, the certificate must also show the kind of
attachment, together with a description of the property attached, and a notice that money or currency in which such redemption must be made, which must be the
it is attached, and by leaving a similar copy of the order, description, and notice same as that specified in the judgment. A duplicate of such certificate must be
with an occupant of the property, if there is one. filed by the officer in the office of the registrar of land titles of the province.
Real property or an interest therein, belonging to the defendant and held by any Under section 465, if the judgment debtor redeems, he is entitled to a certificate of
other person, shall be attached by filing with the registrar of land titles in the redemption, which must be filed with the registrar of deeds, but if the property is not
province in which the land is situated, a copy of the order of attachment, together redeemed, the sheriff's deed of the property sold must also be registered, for, under the
with a description of the property, and a notice that such real property and any provisions of section 1 of Act No. 2837, if not registered, it would only be valid as between
interest of the defendant therein, held by or standing in the name of such other the parties, and hence in the instant case, it would not be of any value to the purchaser at
person (naming him) are attached; and by leaving with the occupant, if any, and the sheriff's sale.
with such other person, or his agent, if known and within the province, a copy of
the order, description, and notice. The registrar must index statements filed
under the first paragraph of this section, in the names, both the plaintiff and of the Section 466 of the Code of Civil Procedure provides:
defendant, and must index attachments filed under the second paragraph of this
section, in the names of the plaintiff and of the defendant and of the person by If no redemption be made within twelve months after the sale, the purchaser, or
whom the property is held or in whose name it stands on the records. his assignee, is entitled to a conveyance; or, if so redeemed, whenever sixty
days have elapsed and no other redemption has been made, notice thereof
It was under the second paragraph of this section that the property was attached as the given, and the time for redemption has expired, the last redemptioner, or his
property of the grantors in the deed, and attachment indexed by the registrar as therein assignee, is entitled to a deed from the officer. but in all cases the judgment
provided. That portion of the section deals with real property or an interest therein debtor shall have the entire period of twelve months from the date of the sale to
belonging to the defendants in the attachment suit, which may be held by any other redeem the property. If the judgment debtor redeem, he must make the same
person, and section 450 of the Code of Civil Procedure provides: payments as are required to effect a redemption by a redemptioner. If the debtor
redeem, the effect of the sale is terminated and he is restored to his estate. Upon
a redemption by the debtor, the person to whom the payment is made must
All goods, chattels, moneys, and other property, both real and personal, or ant execute and deliver to him a certificate of redemption acknowledged or approved
interest therein of the judgment debtor, not exempt by law, and all property and before an officer authorized to take acknowledgment of conveyances of real
rights of property seized and held under attachment in the action, shall be liable property. Such certificate must be filed and recorded in the office of the registrar
to execution. Shares and interests in any corporation or company, and debts, of land titles of the province in which the property is situated, and the registrar
credits and all other property, both real and personal, or any interest in either real must note the record thereof on the margin of the record of the certificate of sale.
or personal property, and all other property, not capable of manual delivery, may The payment mentioned in this section and the preceding one may be made to
be attached on execution, in like manner as upon writs of attachment. the purchaser or redemptioner, or for him to the officer who made the sale. When
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
the judgment under which the sale has been made is payable in a specified kind [G.R. No. 151821. April 14, 2004]
of money or currency, payments must be made in the same kind of money or
currency.
Of course, if at the time the attachment was levied in the grantors in the deed, the BANK OF THE PHILIPPINE ISLANDS, as Successor-in-Interest of BPI Investment
defendants in the attachment proceedings, did not have any right, title, or interest in the Corporation, petitioner, vs. ALS MANAGEMENT & DEVELOPMENT
property, Smith, Bell and Co. did not acquire any title to the land by the sheriffs deed. But, CORP., respondent.
if it be a fact that at the time the attachment was levied, the grantors in the deed did have
an interest in the property at the time the attachment was levied, it follows that Smith, Bell
and Co. acquired that interest by and through the sheriff's deed. That is to say, that if at the DECISION
time attachment was levied Cristina Martinez was in good faith the real owner of the
PANGANIBAN, J.:
property, Smith, Bell and Co. did not acquire any title, and Cristina Martinez would be and
remain the owner of the property, the same as if had never been sold at the sheriff's sale.
But Smith, Bell and Co., having attached the property as property of the grantors in the Factual findings of the lower courts are entitled to great respect, but may be reviewed
deed at the time the attachment was made, and following the claim of Cristina Martinez, if they do not conform to law and to the evidence on record. In the case at bar, a
having executed a good and sufficient bond to purchased the property at the sale, and meticulous review of the facts compels us to modify the award granted by the Court of
having received the sheriff's deed, is entitled to have the result of such proceedings made Appeals.
a matter of official record, so as to preserve and protect any legal rights it may have
acquired in the land as a result of such proceedings, and under the provisions of section 1
of Act No. 2837, those rights, if any, cannot be protected without the registration of the
sheriff's deed. Such registration would not legally mean that Smith, Bell and Co. was the The Case
owner of the property described in the sheriff's deed, or any interest therein. It would
simply mean that by the sheriff's deed, Smith, Bell, and Co. had acquired any right, title or
interest which the grantors had in the fourth parcel of land described in the deed at the Before us is a Petition for Review[1] under Rule 45 of the Rules of Court, seeking to
time the attachment was levied. It might be a cloud on the title of Cristina Martinez, and it set aside the November 24, 2000 Decision[2] and the January 9, 2002 Resolution[3] of the
might be necessary for her to bring a suit to remove the cloud and to quiet her title. Be that Court of Appeals (CA) in CA-GR CV No. 25781. The assailed Decision disposed as
as it may, she would be fully protected from all loss or damage by the sheriff, or after the follows:
deed is registered, Smith, Bell and Co., could then maintain a suit to ascertain what rights,
if any, it had acquired by the sheriff's deed in and to the fourth parcel of land.
WHEREFORE, premises considered, the assailed decision is hereby AFFIRMED in
toto and the instant appeal DISMISSED.[4]
Although in some matters, the registrar may have some quasi-judicial power, yet a suit to
quiet a title to ascertain and determine an interest in real property is a matter exclusively
The assailed Resolution denied reconsideration.
within the jurisdiction of the courts. The title, if any, which Smith, Bell and Co. has in the
fourth parcel of land by the sheriff's deed was acquired by and through a judicial
proceeding, and it has a legal right to have that title settled and determined in the courts,
and under the provisions of its sheriff deed, it would in legal effect be deprived of that right.
The Facts
In the registering the actual sheriff's deed, care should be taken to recite the actual facts,
the source and chain of title, so as to protect the rights of Smith, Bell and Co., and it should
be done so as not to prejudice, injure or impair any rights which Cristina Martinez may
have acquired in the land by her deed, thus leaving the respective rights of each party to The facts of the case are narrated by the appellate court as follows:
be settled and determined upon proper pleadings in a judicial proceeding.
On July 29, 1985, [petitioner] BPI Investment Corporation filed a complaint for a Sum of
The judgment of the lower court is reversed, and following this opinion, the writ of Money against ALS Management and Development Corporation, alleging inter alia that on
mandamus shall issue as prayed for by the petitioner. Neither party to recover costs. So July 22, 1983, [petitioner] and [respondent] executed at Makati, Metro Manila a Deed of
ordered. Sale for one (1) unfurnished condominium unit of the Twin Towers Condominium located
at Ayala Avenue, corner Apartment Ridge Street, Makati, Metro Manila designated as Unit
E-4A comprising of 271 squares [sic] meters more or less, together with parking stalls
identified as G022 and G-63. The Condominium Certificate of Title No. 4800 of the
Registry of Deeds for Makati, Metro Manila was issued after the execution of the said
Deed of Sale. [Petitioner] advanced the amount of P26,300.45 for the expenses in causing
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
the issuance and registration of the Condominium Certificate of Title. Under the 2. The anodized aluminum used in the door and windows were damaged;
penultimate paragraph of the Deed of Sale, it is stipulated that the VENDEE [respondent]
shall pay all the expenses for the preparation and registration of this Deed of Sale and 3. The kitchen counter tops/splashboard suffered from cracks and were mis-cut and
such other documents as may be necessary for the issuance of the corresponding
misaligned;
Condominium Certificate of Title. After the [petitioner] complied with its obligations under
the said Deed of Sale, [respondent], notwithstanding demands made by [petitioner], failed
and refused to pay [petitioner] its legitimate advances for the expenses mentioned above 4. The partition between living and masters bedroom was unpainted and it had no access
without any valid, legal or justifiable reason. for maintenance due to aluminum fixed glass cover;
In its Answer with Compulsory Counterclaim, [respondent] averred among others that it 5. The varifold divider, including the bar and counter top cabinet were not installed;
has just and valid reasons for refusing to pay [petitioners] legal claims. In clear and direct
contravention of Section 25 of Presidential Decree No. 957 which provides that No fee 6. The toilets had no tiles;
except those required for the registration of the deed of sale in the Registry of Deeds shall
be collected for the issuance of such title, the [petitioner] has jacked-up or increased the
amount of its alleged advances for the issuance and registration of the Condominium 7. No closed circuit TV was installed;
Certificate of Title in the name of the [respondent], by including therein charges which
should not be collected from buyers of condominium units. [Petitioner] made and 8. Rainwater leaks inside or into the condominium unit. [5]
disseminated brochures and other sales propaganda in and before May 1980, which made
warranties as to the facilities, improvements, infrastructures or other forms of development
of the condominium units (known as The Twin Towers) it was offering for sale to the public, Respondents Answer prayed that judgment be rendered ordering [petitioner] to
which included the following: correct such defects/deficiencies in the condominium unit,[6] and that the following reliefs
be granted:
The Twin Towers is destined to reflect condominium living at its very best.
1. The sum of P40,000.00 plus legal interest thereon from the date of extra-judicial
demand, representing the amount spent by the defendant for the completion works it had
While the twin tower design and its unusual height will make the project the only one of its undertaken on the premises.
kind in the Philippines, the human scale and proportion [are] carefully maintained.
2. The sum of U.S.$6,678.65 (or its equivalent in the Philippine currency) representing the
To be sure, modern conveniences are available as in the installation of an intercom system unearned rental of the premises which the defendant did not realize by reason of the late
and a closed-circuit TV monitor through which residents from their apartments can see delivery to him of the condominium unit;
their guests down at the lobby call station.
3. Twenty-four percent (24%) interest per annum on the agreed one (1) year advance
Some of the features of each typical apartment unit are: x x x A bar x x x Three toilets with rental and one (1) month deposit (totaling U.S.$15,785.00) corresponding to the period
baths x x x. January 1, 1982 to June 17, 1982, which [petitioner] would have earned had he deposited
the said amount in a bank;
The penthouse units are privileged with the provision of an all-around balcony. x x x
4. The sum of U.S.$1,214.30 per month, commencing from May 1, 1985, which the
[Respondent] further averred that [petitioner] represented to the [respondent] that the [respondent] no longer earns as rental on the premises because the lessee vacated the
condominium unit will be delivered completed and ready for occupancy not later than same by reason of defects and/or deficiencies;
December 31, 1981. [Respondent] relied solely upon the descriptions and warranties
contained in the aforementioned brochures and other sales propaganda materials when 5. The sum of P50,000.00 plus appearance fees of P300.00 per court hearing, as
[respondent] agreed to buy Unit E-4A of the Twin Tower(s) for the hefty sum attorneys fees;
of P2,048,900.00 considering that the Twin Towers was then yet to be built. In
contravention of [petitioners] warranties and of good engineering practices, the
condominium unit purchased by [respondent] suffered from the following defects and/or 6. Litigation expenses and costs of suit.[7]
deficiencies:
On February 6, 1990, the trial court issued this judgment:
1. The clearance in the walkway at the balcony is not sufficient for passage;
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
1. Ordering the [respondent] to pay [petitioner] the sum of P26,300.45, with legal interest ii) Falling off water-damaged plywood ceiling in the masters
from the filing of the complaint up to full payment thereof, representing the amount spent bedroom bathroom;
for the registration of the title to the condominium unit in [respondents] name;
iii) Grinders mark damage at the bathtub;
2. Ordering [petitioner] to deliver, replace or correct at [petitioners] exclusive expense/cost
or appoint a licensed qualified contractor to do the same on its behalf, the following
f) BALCONY WALKWAY
defects/deficiencies in the condominium unit owned by the [respondent]:
i) PVC pipes installed two (2) inches above floor level causing
a) KITCHEN water to accumulate;
i) The sides of the kitchen sink covered with sealants as well ii) Cracks on level of wash out flooring;
as miscut marble installed as filler at the right side of
the sink;
iii) 14-inches passageway going to the open terrace not
sufficient as passageway;
ii) Miscut marble installed on both sides of the side wall above
the gas range;
iv) PVC pipe installed on the plant box water drained directly
on the balcony floor;
b) FOYERS
Ceiling cut off about one (1) square foot in size and left h) BOYS BEDROOM
unfinished
iii) The water damaged parquet flooring near the door of the
j) LIVING ROOM
dining room to the passage way
a) The sum of P40,000.00 representing reimbursement for expenses incurred for the First Issue:
materials/labor in installing walls/floor titles in 2 bathrooms and bar counter cabinet. Jurisdiction
b) The sum of P136,608.75, representing unearned income for the five-month period that
the defendant had to suspend a lease contract over the premises. Contending that it was the Housing and Land Use Regulatory Board (HLURB) -- not
the RTC -- that had jurisdiction over respondents counterclaim, petitioner seeks to nullify
the award of the trial court.
c) The sum of P27,321.75 per month for a period of twenty-one (21) months (from May
1985 to January 1987), representing unearned income when defendants lessee had to Promulgated on July 12, 1976, PD No. 957 -- otherwise known as The Subdivision
vacate the premises and condominium unit remained vacant, all with legal interest from the and Condominium Buyers Protective Decree -- provides that the National Housing
filing of the counterclaim until the same are fully paid. [8] Authority (NHA) shall have exclusive authority to regulate the real estate trade and
business.[14] Promulgated later on April 2, 1978, was PD No. 1344 entitled Empowering the
National Housing Authority to Issue Writs of Execution in the Enforcement of Its Decisions
Under Presidential Decree No. 957. It expanded the jurisdiction of the NHA as follows:
Ruling of the Court of Appeals
SECTION 1. In the exercise of its function to regulate the real estate trade and business
[9]
and in addition to its powers provided for in Presidential Decree No. 957, the National
On appeal, after a thorough review and examination of the evidence on record, the Housing Authority shall have exclusive jurisdiction to hear and decide cases of the
CA found no basis for disbelieving what the trial court found and arrived at. [10] following nature:
The appellate court sustained the trial courts finding that while [petitioner] succeeded
in proving its claim against the [respondent] for expenses incurred in the registration of [the A. Unsound real estate business practices;
latters] title to the condominium unit purchased, x x x for its part [respondent] in turn
succeeded in establishing an even bigger claim under its counterclaim. [11]
B. Claims involving refund and any other claims filed by subdivision lot or condominium
Hence, this Petition.[12] unit buyer against the project owner, developer, dealer, broker or salesman; and
On February 7, 1981, by virtue of Executive Order No. 648, the regulatory functions
Petitioner raises the following issues for our consideration:
of the NHA were transferred to the Human Settlements Regulatory Commission
I. Whether or not the Honorable Court of Appeals erred in not holding that the (HSRC). Section 8 thereof provides:
trial court had no jurisdiction over the respondents counterclaims.
SECTION 8. Transfer of Functions. -The regulatory functions of the National Housing
II. Whether or not the decision of the Court of Appeals is based on Authority pursuant to Presidential Decree Nos. 957, 1216, 1344 and other related laws are
misapprehension of facts and/or manifestly mistaken warranting a review hereby transferred to the Commission (Human Settlements Regulatory Commission). x x
by this Honorable Court of the factual findings therein. x.Among these regulatory functions are: 1) Regulation of the real estate trade and
III. Whether or not the award of damages by the Honorable Court of Appeals is business; x x x 11) Hear and decide cases of unsound real estate business practices;
conjectural warranting a review by this Honorable Court of the factual claims involving refund filed against project owners, developers, dealers, brokers, or
findings therein.[13] salesmen; and cases of specific performance.
Pursuant to Executive Order No. 90 dated December 17, 1986, the functions of the
HSRC were transferred to the HLURB.
The Courts Ruling
As mandated by PD No. 957, the jurisdiction of the HLURB is encompassing. Hence,
we said in Estate Developers and Investors Corporation v. Sarte:[15]
The Petition is partly meritorious.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
x x x. While PD 957 was designed to meet the need basically to protect lot buyers from the A party may be estopped or barred from raising a question in different ways and for
fraudulent manipulations of unscrupulous subdivision owners, sellers and operators, the different reasons. Thus, we speak of estoppel in pais, of estoppe[l] by deed or by record,
exclusive jurisdiction vested in the NHA is broad and general -to regulate the real estate and of estoppel by laches.
trade and business in accordance with the provisions of said law.
Laches, in general sense, is failure or neglect, for an unreasonable and unexplained length
Furthermore, the jurisdiction of the HLURB over cases enumerated in Section 1 of of time, to do that which, by exercising due diligence, could or should have been done
PD No. 1344 is exclusive. Thus, we have ruled that the board has sole jurisdiction in a earlier; it is negligence or omission to assert a right within a reasonable time, warranting a
complaint of specific performance for the delivery of a certificate of title to a buyer of a presumption that the party entitled to assert it either has abandoned it or declined to assert
subdivision lot;[16] for claims of refund regardless of whether the sale is perfected or it.
not;[17] and for determining whether there is a perfected contract of sale. [18]
In Solid Homes v. Payawal,[19] we declared that the NHA had the competence to The doctrine of laches or of stale demands is based upon grounds of public policy which
award damages as part of the exclusive power conferred upon it -- the power to hear and requires, for the peace of society, the discouragement of stale claims and, unlike the
decide claims involving refund and any other claims filed by subdivision lot or statute of limitations, is not a mere question of time but is principally a question of the
condominium unit buyers against the project owner, developer, dealer, broker or inequity or unfairness of permitting a right or claim to be enforced or asserted. [28]
salesman.[20]
Thus, we struck down the defense of lack of jurisdiction, since the appellant therein
Clearly then, respondents counterclaim -- being one for specific performance failed to raise the question at an earlier stage. It did so only after an adverse decision had
(correction of defects/deficiencies in the condominium unit) and damages -- falls under the been rendered.
jurisdiction of the HLURB as provided by Section 1 of PD No. 1344.
We further declared that if we were to sanction the said appellants conduct, we
would in effect be declaring as useless all the proceedings had in the present case since it
was commenced x x x and compel the judgment creditors to go up their Calvary once
The Applicability of Estoppel more. The inequity and unfairness of this is not only patent but revolting. [29]
We also find petitioner guilty of estoppel by laches for failing to raise the question of It is readily apparent that petitioner is raising issues of fact that have been ruled upon
jurisdiction earlier. From the time that respondent filed its counterclaim on November 8, by the RTC and sustained by the CA. The factual findings of lower courts are generally
1985, the former could have raised such issue, but failed or neglected to do so. It was only binding upon this Court and will not be disturbed on appeal, especially when both sets of
upon filing its appellants brief [26] with the CA on May 27, 1991, that petitioner raised the findings are the same.[32] Nevertheless, this rule has certain exceptions, [33] as when those
issue of jurisdiction for the first time. findings are not supported by the evidence on record.
In Tijam v. Sibonghanoy,[27] we declared that the failure to raise the question of We have carefully scrutinized the records of this case and found reason to modify the
jurisdiction at an earlier stage barred the party from questioning it later. Applying the rule award to conform to law and the evidence. We thus address the arguments of
on estoppel by laches, we explained as follows: petitioner seriatim.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
It is undisputed that petitioner sent respondent a Contract to Sell [46] declaring that the
The brochure that was disseminated indicated features that would be provided each construction would be finished on or before December 31, 1981. [47] The former delivered
condominium unit; and that, under Section 19 of PD No. 957, would form part of the sales the condominium unit only in June 1982;[48] thus, the latter claims that there was a delay in
warranties of petitioner.[34] Respondent relied on the brochure in its decision to purchase a the delivery.
unit.[35] Since the former failed to deliver certain items stated therein, then there was a
clear violation of its warranties and representations. Because of this delay, the trial court ordered petitioner to pay damages
of P136,608.75 representing unearned income for the period that respondent had to
The brochure says that [t]he particulars stated x x x as well as the details and visuals suspend a lease contract. We find a dearth of evidence to support such award.
shown x x x are intended to give a general idea of the project to be undertaken, and as
such, are not to be relied [upon] as statements or representations of fact. [36] This general To recover actual damages, the amount of loss must not only be capable of proof,
disclaimer should apply only to the general concept of the project that petitioner aptly but also be proven with a reasonable degree of certainty. [49] The lone evidence for this
characterizes thus: award was the self-serving testimony of respondents witness that a lease contract had
indeed been intended to commence in January 1982, instead of the actual implementation
on June 18, 1982.[50] Without any other evidence, we fail to see how the amount of loss
x x x [D]estined to reflect condominium living at its very best and its design x x x will make was proven with a reasonable degree of certainty.
the project the only one of its kind in the Philippines. [37]
This disclaimer, however, should not apply to the features and the amenities that the
brochure promised to provide each condominium unit. Petitioner was thus in breach when Condominium Defects
it failed to deliver a closed-circuit TV monitor through which residents from their
apartments can see their guests x x x.[38]
The rule is that a partys case must be established through a preponderance of
evidence.[51] By such term of evidence is meant simply evidence that is of greater weight,
or is more convincing than that which is offered in opposition to it. [52]Respondent was able
Storage Facilities to establish through its witness testimony that the condominium unit suffered from
defects.[53] This testimony was confirmed by an inspection report [54] noted and signed by
petitioners representative, as well as by a commissioners report [55] prepared after an ocular
The trial court erred, though, in requiring petitioner to provide storage facilities on the inspection by the clerk of court acting as a commissioner. Furthermore, this conclusion is
ground floor, as the non-delivery had not been alleged in respondents Answer with supported by the circumstances that occurred during the lease period, as evidenced by the
Counterclaim.[39] complaint and the update letters[56] of respondents lessee.
It is elementary that a judgment must conform to and be supported by both the Petitioners contention that the claim arising from the alleged defects has already
pleadings and the evidence, and that it be in accordance with the theory of the action on prescribed must fail for being raised for the first time only on appeal. [57] Well-settled is the
which the pleadings were framed and the case was tried. [40] Indeed, issues in each case rule that issues not raised below cannot be resolved on review in higher courts. [58]
are limited to those presented in the pleadings. [41]
We agree, however, that the lower courts erred in finding that there was a defect in a
We are aware that issues not alleged in the pleadings may still be decided upon, if portion of the balcony, which respondent alleges to be a walkway x x x [that] is not
tried with the parties express or implied consent. [42] Trial courts are not precluded from sufficient for passage.[59] Petitioner was able to prove, however, that the specifications
granting reliefs not specifically claimed in the pleadings -- notwithstanding the absence of thereof conformed to the building plan.
their amendment -- upon the condition that evidence has been presented properly, with full
opportunity on the part of the opposing parties to support their respective contentions and Respondent contends that this portion should have been 65 to 80 centimeters wide,
to refute each others evidence.[43] This exception is not present in the case at bar. so that it would be sufficient as a passageway. [60] The building plan[61] had not specified the
width, however. Architect Leo Ramos of W.V. Coscolluela & Associates, the architectural
Moreover, a cursory reading of the brochure shows that there is no promise to firm that prepared the building plan, testified thus:
provide individual storage facilities on the ground floor for each condominium unit. The
brochure reads: Storage facilities in the apartment units and the ground floor. [44] Apparent Q I am directing your attention xxx to a certain portion in this condominium unit
from the letter of petitioner dated June 18, 1982, [45] was its compliance with its promise of x x x it appears x x x [that] there is no measurement indicated therein, do
storage facilities on the ground floor. In that letter, respondent was also informed that it you know why the measurement of said portion was not indicated in the
may course a reservation of those facilities through the building superintendent. building plan?
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
A It depends on the actual measurement of the building construction. Respondent entered into a lease contract with Advanced Micro Device on May 18,
1982, for the period June 18, 1982 to June 17, 1983, with option to renew. [71] The lease --
Q Could you please tell the Court, what x x x the purpose of the said portion of which was for an agreed monthly rental of P17,000 -- was renewed for a period ending
the condominium unit [is]? May 1, 1985, when Advanced Micro Device vacated the unit. [72] On the basis of these
facts, the trial court ordered petitioner to pay damages by way of unrealized income for
A It is used for watering the plants and the servicing of some area[s]. twenty-one months or from May 1, 1985, until January 1987 -- when respondent decided to
move into the condominium unit, which was unoccupied by then.
Q How much measurement is made to affix the portion of watering the plants?
Despite the defects of the condominium unit, a lessee stayed there for almost three
A Approximately .50 [m].[62]
years.[73] The damages claimed by respondent is based on the rent that it might have
Respondent maintains that this portion should have been .80 meters (or 80 earned, had Advanced Micro Device chosen to stay and renew the lease.Such claim is
centimeters), similar to another area in the building plan that it offered as Exhibit 2- highly speculative, considering that respondent failed to adduce evidence that the unit had
A.[63] But an analysis of this plan reveals that the latter area has a different width from that been offered for lease to others, but that there were no takers because of the defects
of the former. therein. Speculative damages are too remote to be included in an accurate estimate
thereof.[74] Absent any credible proof of the amount of actual damage sustained, the Court
It is readily apparent from the foregoing facts that the portion in controversy was not cannot rely on speculations as to its existence and amount.[75]
intended to be a walkway. Thus, there was no deviation from the building plan. Because it
has not been shown that this section was insufficient to serve the purpose for which it was We recognize, however, that respondent suffered damages when its lessee vacated
intended, the lower courts erred in considering it as defective. the condominium unit on May 1, 1985, because of the defects therein. Respondents are
thus entitled to temperate damages.[76] Under the circumstances, the amount equivalent to
three monthly rentals of P17,000 -- or a total of P51,000 -- would be reasonable.
Reimbursement of P40,000 WHEREFORE, this Petition is PARTLY GRANTED, and the assailed Decision and
for Completion Work Resolution of the Court of Appeals MODIFIED, as follows:
Hereby DELETED is the requirement on the part of petitioner to (1) deliver storage
facilities on the ground floor; (2) pay P136,608.75 for unearned income for the five-month
The lower courts did not err in ordering petitioner to correct the defects in the period that the lease contract was allegedly suspended; (3) correct the alleged
condominium unit, but in requiring it to reimburse respondent in the amount of P40,000 for passageway in the balcony; (4) pay P40,000.00 as reimbursement for completion work
completion work done. done by respondent; (5) pay P27,321.75 per month for a period of twenty-one months for
the alleged unearned income during the period when the condominium unit remained
Petitioner argues that the trial courts Decision encompassed the areas beyond those vacant. Petitioner, however, is ORDERED to pay P51,000 as temperate damages for the
alleged in respondents Answer.[64] This contention is not convincing, because the termination of the lease contract because of the defects in the condominium unit. All other
allegations in the latter were broad enough to cover all the defects in the condominium awards are AFFIRMED.
unit. In fact, respondent prayed that judgment be rendered ordering [petitioner] to correct
such defects x x x in the condominium unit as may be prove[d] during the trial. [65] No pronouncement as to costs.
Petitioner further challenges the award of P40,000 as reimbursement for completion SO ORDERED.
work done by respondent, on the ground that this claim was not proven during the
trial. The latters evidence partook of a witness testimony[66] and of a demand letter[67] sent Davide, Jr., C.J., (Chairman), Ynares-Santiago, Carpio, and Azcuna, JJ., concur.
to petitioner requesting reimbursement for completion work done. Petitioner argues that
respondent should have presented receipts to support the expenses. [68]
We agree with petitioner. While respondent may have suffered pecuniary losses for
completion work done, it failed to establish with reasonable certainty the actual amount
spent. The award of actual damages cannot be based on the allegation of a witness
without any tangible document, such as receipts or other documentary proofs to support
such claim.[69] In determining actual damages, courts cannot rely on mere assertions,
speculations, conjectures or guesswork, but must depend on competent proof and on the
best obtainable evidence of the actual amount of loss. [70]
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
[G.R. No. 132869. October 18, 2001] approved.[4] In a letter dated 18 January 1984 QPSDCI President Quintin P. San Diego
forwarded the letter to petitioner. However, the amount approved was only P139,100.00
and not P160,000.00. Additional charges further reduced the amount to P117,043.33.
Petitioner De Vera Jr. approached QPSDCI to have the P12,040.00 discount credited
GREGORIO DE VERA, JR., petitioner, vs. COURT OF APPEALS, Q. P. SAN DIEGO to his additional equity. Since the resultant net loan of P117,043.33 was insufficient to
CONSTRUCTION, INC., ASIATRUST DEVELOPMENT BANK, SECOND cover the balance of the purchase price, De Vera Jr. negotiated with QPSDCI to defer
LAGUNA DEVELOPMENT BANK, CAPITOL CITY DEVELOPMENT BANK, payment of the P23,916.67 deficiency until the project was completed and the unit was
EX-OFFICIO SHERIFF OF QUEZON CITY and/or HIS DEPUTY, respondents. ready for turnover. QPSDCI agreed.[5]
The condominium project was substantially completed in June 1984 and the unit was
DECISION turned over to De Vera Jr. the following month. Accordingly, petitioner paid QPSDCI
BELLOSILLO, J.: the P23,916.67 shortfall between the balance and the granted loan.
On 26 June 1984 ASIATRUST through its Vice-President Pedro V. Lucero and
This is a Petition for Review, under Rule 45 of the Revised Rules of Court, of Manager Nicanor T. Villanueva wrote to QPSDCI asking the unit buyers to pay in advance
the Decision of the Court of Appeals in CA-G.R. CV No. 37281, "Gregorio de Vera, Jr. v. the costs of the transfer of titles and registration of their Pag-IBIG loan
Court of Appeals, QP San Diego Construction, Inc., Asiatrust Development Bank, Second mortgages.[6] QPSDCI forwarded the letter to De Vera Jr. and requested that he pay the
Laguna Development Bank, Capitol City Development Bank, Ex-Officio Sheriff of Quezon amount to QPSDCI.[7] As ASIATRUST indicated that the amount be paid directly to it, De
City and/or his Deputy," and of its Resolution of 18 February 1998 denying Vera Jr. went to the bank for clarification. On 23 August 1983, after learning that
petitioner's Manifestation with Motion for Reconsideration. ASIATRUST was in possession of the certificate of title, De Vera Jr. paid the transfer
expenses directly to ASIATRUST.
Respondent Q. P. San Diego Construction, Inc. (QPSDCI), owned a parcel of land
located at 101 Panay Avenue, Quezon City, on which it built Lourdes I Condominium. On On 17 September 1984 ASIATRUST sent another notice of approval [8] to QPSDCI
10 June 1983, to finance its construction and development, QPSDCI entered into and De Vera Jr. with the notation, "additional equity of all accounts have (sic) to be paid
a Syndicate Loan Agreement[1] with respondents Asiatrust Development Bank directly to the Bank."
(ASIATRUST) as lead bank, and Second Laguna Development Bank (LAGUNA) and
Capitol City Development Bank (CAPITOL) as participating banks (hereafter collectively On 3 October 1984 ASIATRUST wrote another letter [9] asking QPSDCI to advise the
known as FUNDERS).QPSDCI mortgaged to the creditor banks as security the herein unit buyers, among others, to pay all additional and remaining equities on 10 October
mentioned Panay Avenue property and the condominium constructed thereon. The 1984; that their Pag-IBIG loan mortgages would be registered only upon payment of those
mortgage deed was registered with the Register of Deeds of Quezon City and annotated equities; and, that loan mortgages registered after 31 October 1984 would be subject to
on the individual condominium certificates of title (CCT) of each condominium unit. [2] the increased Pag-IBIG interest rates.
On 23 June 1983 petitioner Gregorio de Vera Jr. and QPSDCI, through its authorized On 12 October 1984 ASIATRUST also wrote a letter to petitioner and signed by its
agent Fil-Estate Realty Corporation (FIL-ESTATE), entered into a Condominium Assistant Manager Leticia R. de la Cruz informing him that his housing loan would only be
Reservation Agreement[3] where petitioner undertook to buy Unit 211-2C of the implemented upon the following conditions: (a) Payment of the remaining equity directly to
condominium for P325,000.00 under the following agreed terms of payment: (a) an option ASIATRUST Development Bank; and (b) Signing of all Pag-IBIG documents not later than
money of P5,000.00 payable upon signing of the agreement to form part of the purchase 20 October 1984, so his mortgages could be registered on or before 31 October
price; (b) a full downpayment of P175,675.00 broken down into the reservation fee 1984. Mortgages registered beyond said date shall subject the Pag-IBIG loan to the
of P5,000.00 and three (3) equal monthly installments payable beginning the month after increased interest rates of the National Home Mortgage Finance Corp. (per Circular #27
the signing of the contract; and, (c) the remaining balance of P160,000.00 to be secured dated June 21, 1984).
through petitioner's Pag-IBIG and Open-Housing Loan. Pending release of the loan, According to petitioner, the letter came as a total surprise to him; all the while he
petitioner was to avail of a bridge financing loan with ASIATRUST or any accredited thought that his loan had already been released to QPSDCI and the titles transferred to his
originating bank of the Pag-IBIG program. name; he promptly wrote ASIATRUST to seek clarification; ASIATRUST responded by
On 2 June 1983 petitioner paid the reservation fee of P5,000.00, and on 11 July informing De Vera Jr. that the developmental loan agreement between QPSDCI and the
1983 the balance of the downpayment of P167,000.00, thus completing the downpayment three (3) banks, under which the individual titles of the condominium units were mortgaged
of P175,675.00 well before the due date. As incentive, petitioner was given a full discount in favor of the FUNDERS to secure the loan, shall be paid out of the net proceeds of the
on cash payment by QPSDCI to bring the total payment to P184,040.00. Pag-IBIG loans of the buyers; that the total amount of loan from the FUNDERS was
distributed among all condominium units such that each unit had to bear a certain portion
Pursuant to their Condominium Reservation Agreement, petitioner submitted through of the total loan, or a "loan value;" that per agreement with QPSDCI, ASIATRUST would
FIL-ESTATE his application for the Pag-IBIG loan. On 28 December 1983 ASIATRUST as only grant the Pag-IBIG Housing Loan with the release of the mortgage liens, which could
originating bank notified FIL-ESTATE that petitioner's Pag-IBIG loan application had been
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
not be released unless the buyers fully paid their respective loan values; and that The Court of Appeals affirmed the decision of the trial court with the modification that
petitioner's equity payments to QPSDCI had not been remitted to the bank. respondents were ordered solidarily to pay petitioner P50,000.00 as nominal damages, but
the award for actual and exemplary damages was deleted.
On 30 May 1985 ASIATRUST informed QPSDCI that it could no longer extend the
bridge financing loan to some of the buyers, including petitioner, for various On 9 July 1997 petitioner filed a "Compliance with Manifestation and Motion for
reasons,[10] among which was that petitioner had already exceeded the age limit, hence, he Extension of Time to File Motion for Reconsideration" alleging that he received the
was disqualified.[11] decision of the Court of Appeals on 4 July 1997 and requesting a thirty (30)-day extension
within which to file a motion for reconsideration. The motion was denied by respondent
After learning of the disapproval of his loan, petitioner wrote the president of QPSDCI appellate court.
to make arrangements to settle his balance. Since petitioner had already invested a
substantial amount in remodelling and improving his unit, rescinding the sale was no On 8 August 1997 petitioner filed a "Manifestation with Motion for Reconsideration,"
longer a viable option. Consequently, he only asked the president of QPSDCI for some and on 6 February 1998 a "Compliance with Motion to Resolve Manifestation with Motion
assurance that the title would be turned over to him upon full payment. for Reconsideration," with respondent court. Reckoning the deadline of the period to file a
motion for reconsideration at 19 July 1997, the Court of Appeals denied petitioner's Motion
In response, QPSDCI suggested that petitioner deal directly with ASIATRUST for for Reconsideration for having been filed out of time. Hence, the instant petition for review
any matter regarding the sale of the unit. [12] President San Diego explained that "as far as on certiorari.
we are concerned we have sold to you our property at a certain price and we have
correspondingly issued to your goodself, thru the Bank, a Deed of Absolute Sale for the Petitioner assails the 18 February 1998 Resolution denying
unit we sold to you taking into consideration that the Bank has approved your loan per their his Motion for Reconsideration, asserting that the Court of Appeals should not have denied
advice dated December 28, 1983 and presumably credited us for the approved amount of his motion on mere technicality. Petitioner claims that his counsel was not notified of the
loan." Court of Appeals' decision.The Notice of Judgment [16] of the decision of the Court of
Appeals shows that the same was served on petitioner Gregorio de Vera himself and not
As petitioner failed to obtain the housing loan, he was not able to pay the balance of on his counsel. Petitioner asserts that service to a party is allowed only if the party is not
the purchase price. QPSDCI sent him a letter[13] dated 6 August 1987 presenting him with represented by counsel. But if he is represented by a counsel, then service shall be made
two options: (a) to pay the remaining balance of the purchase price, with interest, which upon his counsel unless service upon the party himself is ordered by the court. Unless so
had already ballooned to P263,751.63, on or before 15 August 1987; or, (b) to pay rent for ordered, service on the party himself who is represented by counsel is not notice in law,
the use of the unit from 28 July 1984 to June 1987. hence, invalid.[17]
On 20 May 1988 petitioner, upon discovering that the FUNDERS had already Furthermore, justice will be better served by entertaining this petition than by
published a notice[14] of extrajudicial foreclosure of the mortgage, filed a complaint against dismissing it outright. It is always in the power of this Court to suspend its own rules, or to
respondents for damages and injunction with urgent prayer for issuance of a writ of except a particular case from its operation, whenever the purposes of justice require it. [18]
preliminary injunction, annulment of mortgage based on fraud, with urgent prayer for the
issuance of a writ of preliminary attachment and specific performance. The complaint was The trial court found that petitioner's failure to pay the balance of the price of Unit
docketed as Civil Case No. Q-53737 and subsequently raffled to Branch 107 of the 211-2C was not his fault. It also found that petitioner was a real party in interest to annul
Regional Trial Court of Quezon City. the loan agreement between QPSDCI and the FUNDERS, and that he had priority in right
to the unit over the FUNDERS. The trial court rejected QPSDCI's counterclaim against
Meanwhile, QPSDCI failed to pay its obligations to the FUNDERS. On 23 May 1988 petitioner for rentals and sustained petitioner's claim for damages against private
ASIATRUST extrajudicially foreclosed the mortgage on twenty-seven (27) condominium respondents.
units, including that of petitioner De Vera Jr. The units were sold at public auction, with the
FUNDERS as the highest bidder. The certificate of sale was issued and annotated on the The Court of Appeals ruled that the regular courts had no jurisdiction over the subject
CCTs. matter of the case, the proper venue being the Housing and Land Use Regulatory Board
(HLURB). However, respondents were estopped from questioning jurisdiction because
On 3 March 1992 the trial court rendered judgment "directing the defendants (herein they filed counterclaims in the lower court.
respondents) to pay to the plaintiff (herein petitioner) jointly and severally the sum
equivalent to the penalties and charges plus whatever amount may be necessary to As to the issue of who had superior right over the Unit 211-2C, the Court of Appeals
redeem Unit 211-2C from any lien and encumbrances so that the title may be released and ruled in favor of petitioner, holding that the mortgage in favor of ASIATRUST, which was
delivered to the plaintiff, free from any lien and encumbrances, subject only to the the basis for its title, did not bind petitioner inasmuch as the same was not registered with
deduction of his unpaid balance of P139,000.00, which the plaintiff should pay out of his the National Housing Authority (NHA), contrary to the mandate of Sec. 18 of PD 957, or
own funds, plus exemplary damages of P100,000.00 each and to pay plaintiff attorney's "The Subdivision and Condominium Buyers' Protective Decree."[19] The appellate court
fees jointly and severally x x x P50,000.00 plus the expenses of litigation." The lower court further found that QPSDCI breached its warranties as seller under Art. 1547, and also
denied plaintiff's prayer for moral damages and dismissed defendants' counterclaim violated its obligation to deliver to petitioner a clean title as required by Sec. 4 of PD 957. It
against the plaintiff and cross-claims against each other.[15] declared that delivery of the unit to petitioner operated to transfer ownership to him from
QPSDCI.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Respondents did not appeal. Petitioner contests the decision of the Court of Appeals negligence as evidenced by Exhs. S and S-1. The compensation is the same amount as
only insofar as it deleted the award of actual and exemplary damages and attorney's whatever the liability may be and therefore merely offsets the liability x x x x
fees. The only issue to be addressed by this Court therefore is the propriety of the award
of damages in favor of petitioner.
The cost of clearing the CCT of liens and encumbrances and transferring it to the name of
In finding QPSDCI liable for damages, the trial court held - the petitioner are also part of the actual or compensatory damages and are its own proof.
x x x it (QPSDCI) has not exerted any reasonable diligence or effort to procure the Article 2199 of the Civil Code provides that one is entitled to adequate compensation
issuance of the title to the plaintiff. All that it did was to refer the plaintiff to the Funder(s), only for such pecuniary loss suffered by him as is "duly proved."[20] This provision denies
alleging that he (plaintiff) should transact business with them as the matter of loan is the grant of speculative damages, or such damage not actually proved to have existed and
between the plaintiff and the Funder(s), and they had nothing to do with it. However, it to have been caused to the party claiming the same.[21] Actual damages, to be
collected the additional equity and never forwarded the same to the Funder(s) nor recoverable, must not only be capable of proof, but must actually be proved with
informed the latter of plaintiff's payment thereof. Thus, to the mind of Asiatrust, plaintiff reasonable degree of certainty. Courts cannot simply rely on speculation, conjecture or
never paid the additional equity, although per records of the Seller, he already had. guesswork in determining the fact and amount of damages. [22]
This does not mean however that petitioner is liable to private respondents for
All these show negligence on the part of the Seller to perform its obligations under the penalties, interests and other charges that accrued by reason of non-payment of the
contract -- to the detriment of the plaintiff, for which it should be liable for damages under balance of the purchase price. Respondent ASIATRUST had made several
Art. 2201 of the Civil Code, for the natural and probable consequences of the breach of the representations to petitioner that his loan had been approved. The tenor of the letters sent
obligation which the parties, specially the Seller, should have forseen or could have by ASIATRUST would lead a reasonable man to believe that there was nothing left to do
reasonably forseen at the time the obligation was contracted. but await the release of the loan. ASIATRUST cannot hide behind the pithy excuse that the
grant of the bridge financing loan was subject to the release of the Pag-IBIG loan. The
essence of bridge financing loans is to obtain funds through an interim loan while the Pag-
As to respondent ASIATRUST, the trial court held that its failure to notify petitioner of
the required steps to be taken after the approval of the loan, of the requirement that IBIG funds are not yet available. To await the release of the Pag-IBIG loan would render
any bridge financing nugatory. Thus, we agree with the trial court when it said that "the
additional equity be paid directly to the bank and other important aspects of the bridging
loan, made it liable for damages under the general provisions on torts under Art. 2176 of conclusion is inevitable that although the plaintiff was not able to pay, he was a victim of
the Civil Code, in relation to Art. 2202. circumstances and his failure was not due to his own fault."
In deleting the award for damages, the respondent Court of Appeals explained - Furthermore, Sec. 25 of PD 957 provides:
As earlier found, QPSDCI failed to comply with its warranties as seller. Unfortunately, Sec. 25. Issuance of Title. - The owner or developer shall deliver the title of the lot or unit
plaintiff-appellee posits the propriety of the award of actual damages only in the probable to the buyer upon full payment of the lot or unit. No fee, except those required for the
sense: that such award is to the amount of interests, penalties and other charges as registration of the deed of sale in the Registry of Deeds, shall be collected for the issuance
plaintiff may stand liable for by reason of the non-payment of the purchase price. In other of such title. In the event a mortgage over the lot or unit is outstanding at the time of the
words, plaintiff-appellee admits not having suffered damages in consequence of non- issuance of the title to the buyer, the owner or developer shall redeem the mortgage or the
compliance of seller's warranties. Since actual damages are predicated on such pecuniary corresponding portion thereof within six months from such issuance in order that the title
loss as duly proved, the award of the lower court therefor is plainly not in order x x x over any fully paid lot or unit may be secured and delivered to the buyer in accordance
(citations omitted). herewith.
We agree with the respondent Court of Appeals on this point. Petitioner did not From the foregoing it is clear that upon full payment, the seller is duty-bound to
present any proof that he suffered any damage as a result of the breach of seller's deliver the title of the unit to the buyer. Even with a valid mortgage over the lot, the seller is
warranty. He did not lose possession of his condominium unit, although the same had not still bound to redeem said mortgage without any cost to the buyer apart from the balance
of the purchase price and registration fees. It has been established that respondent
yet been registered in his name. In his Consolidated Reply, petitioner came up with this
feeble argument for claiming actual damages, a rehash of his motion for reconsideration QPSDCI had been negligent in failing to remit petitioner's payments to ASIATRUST. If
QPSDCI had not been negligent, then even the possibility of charges, liens or penalties
with the Court of Appeals -
would not have arisen. Therefore, as between QPSDCI and petitioner, the former should
be held liable for any charge, lien or penalty that may arise. However, it was error for the
Petitioner reiterates that the compensatory damages awarded is to the amount of interests, trial court to remedy the situation in the form of an award for damages because, as
penalties and other charges as (he) may stand liable for by reason of the non-payment of discussed earlier, the basis for the same does not appear indubitable.
the balance of the purchase price of Unit #211 in consequence of the respondent's fault or
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Part of the confusion lies in the deficiency of the trial court's decision. It had found [G.R. No. 122088. January 26, 2001]
that petitioner had superior right to the unit over the FUNDERS and the mortgage in favor
of the FUNDERS was contrary to Condominium laws. Therefore, the proper remedy was to
annul the mortgage foreclosure sale and the CCT issued in favor of ASIATRUST, and not
merely decree an award for damages. We held in Union Bank of the Philippines v.
HLURB -[23] GOLD LOOP PROPERTIES, INC. and EMMANUEL R. ZAPANTA, petitioners,
vs. THE COURT OF APPEALS, BHAVNA HARILELA SADHWANI and
RAMESH J. SADHWANI, represented by their attorney-in-fact PURSHUTAM
Clearly, FRDC's act of mortgaging the condominium project to Bancom and FEBTC, DIALANI, respondents.
without the knowledge and consent of David as buyer of a unit therein, and without the
approval of the NHA (now HLURB) as required by P.D. No. 957, was not only an unsound
real estate business practice but also highly prejudicial to the buyer David, (who) has a DECISION
cause of action for annulment of the mortgage, the mortgage foreclosure sale, and the
PARDO, J. :
condominium certificate of title that was issued to the UBP and FEBTC as highest bidders
of the sale.
The case before the Court is an appeal via certiorari from the decision[1] of the Court
of Appeals dismissing the petition for certiorari assailing the decision of the Senior Deputy
These remedies were clearly within those sought for in petitioner's complaint. The
Executive Secretary, Office of the President sustaining the ruling of the Housing Land Use
trial court should have also ordered QPSDCI to credit petitioner's payments to his
and Regulatory Board of Commissioners requiring petitioners to furnish private
outstanding balance and deliver to petitioner a clean CCT upon full payment of the
respondents with copy of the contract to sell and to accept the balance of the purchase
purchase price as mandated by Sec. 25 of PD 957.
price of a condominium unit.
We note that petitioner, believing that he won, did not appeal the trial court's
On July 16, 1988, private respondents Bhavna Harilela and Ramesh Sadhwani
decision. Petitioner is partly to blame for the difficult situation he is in, having filed his
(hereinafter referred to as Sadhwanis) submitted through St. Martin Realty Corporation, a
complaint with the regular courts instead of the HLURB. Nevertheless, both trial court and
realtor agent of petitioner Gold Loop Properties, Inc. (hereinafter referred to as GLPI), a
the Court of Appeals found that petitioner had superior rights over the condominium unit,
signed pro forma reservation application addressed to GLPI for the purchase of one (1)
that petitioner was not bound by the mortgage in favor of the FUNDERS and, that QPSDCI
condominium unit at Gold Loop Towers residential complex, located in Ortigas Complex,
violated its contract with petitioner by its failure to remit the latter's payments. Such
Pasig. One of the terms of the reservation was the execution of a contract to sell once the
findings are uncontested before us and provide enough ground to warrant the modification
downpayment was paid in full. Upon submission of the reservation, the Sadhwanis issued
of the ruling, so that full relief may be accorded to petitioner. The general rule that an
a check for P50,000.00 to cover the reservation fees to Josephine Flores Guina, agent of
appellate court may only pass upon errors assigned may be waived, and the appellate
St. Martin Realty who issued a receipt to them.
court may consider matters not assigned when consideration of which is necessary in
arriving at a just decision and complete resolution of the case or serve the interests of On November 18, 1988, the Sadhwanis paid GLPI the amount of
justice or to avoid dispensing piecemeal justice. [24] P819,531.25. Subsequently, Bhavna Harilela signed a Contract To Sell [2] with GLPI,
represented by its President Emmanuel Zapanta. Ms. Guina assured them that they would
WHEREFORE, the assailed Decision of the Court of Appeals in CA-G.R. CV No.
be furnished with a copy of the contract after its notarization, and that the amount,
37281 is MODIFIED thus -
representing the balance of the purchase price, would be included in a loan application
(a) The mortgage over Unit 211-2C of Lourdes I Condominium covered by CCT No. with a bank. However, the contract to sell was not notarized, as the private respondents
2307 as well as its foreclosure sale is declared NULL and VOID. The Ex-Officio Sheriff of were not able to supply GLPI with a copy of their passports.
Quezon City is ordered to cancel the certificate of sale in favor of ASIATRUST
Under the contract, GLPI agreed to sell to Sadhwanis a 198.75 square meters
Development Bank over the aforesaid Unit 211-2C and the Register of Deeds of Quezon
condominium unit particularly Unit R-84 of Southwest Tower. The contract price was
City to cancel the Annotation of the Real Estate Mortgage (Entry No. 7714) and the
P2,484,375.00, inclusive of a reservation deposit of P50,000.00.
Annotation of the Certificate of Sale (Entry No. 8087); and
The Contract to Sell, Section 3, provides:
(b) Respondents Q. P. San Diego Construction, Inc., and ASIATRUST are ordered to
credit all payments made by petitioner Gregorio de Vera Jr., to his outstanding balance,
and to deliver to petitioner the certificate of title over Unit 211-2C, Lourdes I Condominium, Section 3. PURCHASE PRICE AND TERMS OF PAYMENT.
upon full payment of the purchase price, free from all penalties, liens, charges, except
those accruing after finality of this Decision. (a) The purchase price of the UNIT, exclusive of interest shall be TWO MILLION FOUR
The award of nominal damages in favor of petitioner in the amount of P50,000.00 is HUNDRED EIGHTY FOUR THOUSAND THREE HUNDRED SEVENTY FIVE
AFFIRMED. SO ORDERED. (P2,484,375.00) Pesos, Philippine Currency, payable as follows:
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Less: Reservation 50,000.00 July 16, 1988 By letter[5] dated March 16, 1989, addressed to GLPI, the
Sadhwanis offered to resell their rights to the condominium unit they purchased. The letter
Net Downpayment 819,531.25 Oct. 21, 1988 contained proposals which read:
Balance Payable P1,614,843,80 Per our verbal agreement, this comes to formalize the earnest intention of my clients,
Spouses Ramesh and Anita Sadhwani, to sell their rights over Unit R-84 of the Gold Loop
Towers, under the following terms and conditions:
thru the bank designated by the SELLER and subject to standard banking requisites
and approval.
ACQUISITION:
NOTE: In the event of non-approval of the loan by the bank, the BUYER commits to adopt
198.75 sq. m. @ 12,500 per sq. m. = P2,484,375.00
the Co-Terminus Payment Plan retroactive to the date of scheduled downpayment as
reflected above. This plan requires the payment of non-interest bearing equal monthly Less: 35% downpayment paid 11-15-88 869,531.25
Balance = 1,614,843.75
installments spreads on the full balance of the purchase price commencing 30 days after
the scheduled downpayment up to January 1990.[3]
Monthly amortization payable in = 89,713.54
GLPI informed the Sadhwanis that the bank loan accommodation which was to serve 18 months starting December 1988
until May 1990 @ 3% penalty for
as payment of the balance of the purchase price was disapproved, and thus, per the terms
of the Contract to Sell, the balance would become payable through the Co-terminus delayed amortization = _________3%
Payment Plan schedule of payments, in implementation of which petitioners were informed Penalty per month = P 2,691.41
by letter[4] dated March 15, 1989, which pertinently reads: x 3 months
Total Penalty = P 8,074.22
Despite diligent efforts and ardent representations on our part to have the approval of the
loan in accordance with the Contract, such approval could not be obtained for the reason RE-SALE:
that banks are not willing to extend a loan to be secured by a still ongoing
project. Accordingly, the balance of the purchase price should now be paid in equal 198.75 sq. m. @ P14,500.00
monthly installments until January 1990 pursuant to the aforequoted provision. The per sq. m. = P2,881,875.00
schedule of these payments in implementation of this Co-Terminus Payment Plan should
be as follows: Less: Balance = 1,614,843.75
1,267,031.25
Date of Payment Amount
Less: Interest for delayed
March 20, 1989 (Covering Amortization = 8,074.22
the period from Nov. 21,
1989 to March 21, 1989) P538,281.25 Net cash involved payable
April 20, 1989 107,626.25
in 6 months = P1,258,957.03
May 20, 1989 107,626.25
June 20, 1989 107,626.25
July 20, 1989 107,626.25 Petitioners rejected the offer on the resale of the rights over the condominium unit
August 20, 1989 107,626.25 proposed by private respondents because the offer was unreasonable, unfair and
September 20, 1989 107,626.25 inequitable.
October 20, 1989 107,626.25
November 20, 1989 107,626.25 On March 19 and April 25, 1989, respondent Ramesh J. Sadhwani demanded a copy
December 20, 1989 107,626.25 of the contract to sell, noting that his wife had no official document to show that she bought
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
a condominium unit from GLPI and there were conditions and/or stipulations in the contract IT IS SO ORDERED.[8]
which she could not be expected to comply with, unless a copy of the same be given to
her. By letter dated May 22, 1989 to GLPI, respondent Sadhwanis counsel made a formal On November 16, 1992, petitioners appealed to the HLURB Board of
demand for the delivery to him of a copy of the contract to sell.
Commissioners, Quezon City while private respondents interposed a partial appeal
Spouses Sadhwanis failed to pay any of the monthly amortizations in the payment thereto.
plan. On October 11, 1993, the HLURB Board of Commissioners rendered a decision, the
On August 7, 1989, petitioners sent a letter demanding payment of the balance dispositive portion of which reads:
amounting to P1,614,814.80, and informed the Sadhwanis that GLPI will rescind the
Contract to Sell and automatically forfeit their down payment should they fail to pay within WHEREFORE, premises considered, respondents appeal is hereby DENIED and
five (5) days from receipt of the letter in accordance with section 8 of the contract to sell. [6] complainants Partial Appeal is hereby given due course and the Decision subject of this
Appeal is hereby MODIFIED by DELETING the second paragraph of order number
On August 14, 1990, spouses Sadhwanis filed with the Housing and Land Use two. Accordingly, complainants are directed to pay the balance of the purchase price,
Regulatory Board (hereinafter referred to as HLURB), a complaint for specific performance without interest, within 30 days from receipt hereof while respondents are ordered to
with an alternative prayer for refund against GLPI. Spouses Sadhwanis prayed that they accept said payment and turn over to complainants the unit subject of said contract to sell.
be furnished with a copy of the contract to sell and allowed them to remit the balance of
the consideration to GLPI and to deliver to them the title and possession of the
condominium unit, or to be reimbursed of the amount they paid with interest and All other aspects of the decision is hereby AFFIRMED IN TOTO.
damages.[7]
SO ORDERED.[9]
On October 8, 1990, petitioners filed with the HLURB an answer to the complaint and
subsequently, the parties submitted their position papers.
On January 7, 1994, petitioners elevated the case to the Office of the President.
On October 2, 1992, HLURB Arbiter Roberto F. Paras rendered a decision, the
dispositive portion of which provides: On August 24, 1994, Senior Deputy Executive Secretary Leonardo A.
Quisumbing[10] rendered a decision[11] dismissing petitioners appeal. He also denied
petitioners motion for reconsideration[12] in a Resolution[13] dated December 22, 1994.
WHEREFORE, premises considered, judgment is hereby rendered:
On March 22, 1995, petitioners filed with the Supreme Court a special civil action for
1. Ordering respondents Gold Loop Properties, Inc. and St. Martin to furnish complainants certiorari assailing the decision of the Senior Deputy Executive Secretary, Office of the
with a copy of the subject Contract to Sell and to accept complainants payment of the President. In a resolution dated April 4, 1995, the Court referred the case to the Court of
agreed purchase price balance of the Condominium unit described in the said Contract to Appeals for proper disposition.[14]
Sell;
On June 22, 1995, the Court of Appeals promulgated its decision dismissing the
petition.[15] The court ruled that the failure of petitioners to give respondents a copy of the
2. Ordering said respondents to deliver possession of and to effect the transfer of title to contract to sell sued upon, despite repeated demands therefor, and notwithstanding the
the subject condominium unit in favor of the complainants after full payment of the payment of P878,366.35, was a valid ground for private respondents to suspend their
purchase price; payments. And given the fact that the contract to sell was in writing, the Sadhwanis, as
buyers, were entitled to a copy. Their request for a copy sprung from their desire to comply
In the event compliance with the above dispositive portion is no longer possible, with what was incumbent upon them to perform thereunder. While buyers do not need a
respondents instead are hereby ordered to jointly and severally reimburse complainants copy of the contract to know the stipulated purchase price, the schedule of payments and
the amount of Eight Hundred Seventy Eight Thousand Three Hundred Sixty Six Pesos and the outstanding balance, the contract to sell, being an eight paged single-spaced
Thirty Five Centavos (P878,366.35) representing complainants reservation deposit and document, broken down into twelve sections, spelling out the parties respective monetary
downpayment, with legal interest from the time of the filing of this complaint; and non-monetary rights and obligations, the buyers could not be expected to recall each
and every detail of the stipulations of the contract without a copy of the contract to guide
them.
3. Ordering respondents jointly and severally to pay complainants (a) moral damages in
the amount of Ten Thousand Pesos (P10,000.00), and (b) attorneys fees in the amount of On July 14, 1995, petitioners filed with the Court of Appeals a motion for
Thirty Thousand Pesos (P30,000.00); reconsideration.[16] However, the court denied the motion.[17]
Hence, this petition.[18]
4. Dismissing respondents counterclaim for lack of merit.
Compiled by: SHEENA RHEA FAELNAR
Land Titles and Deeds (Finals) 2017
Petitioners contend that private respondents are not entitled to suspend payment of condominium unit, the contract to sell, or what it represents is concrete proof of the
their monthly amortizations because of the alleged failure of petitioners to furnish them purchase and sale of the condominium unit.
copy of the contract to sell and that private respondents used the alleged failure to give
them copy of the contract as an excuse for defaulting in their contractual obligation to pay WHEREFORE, the Court hereby DENIES the petition for review on certiorari, for lack
the installments. Petitioners insist that private respondents were given copy of the contract of merit. The Court AFFIRMS the decision of the Court of Appeals in CA-G.R. SP No.
to sell. Petitioners pointed out that under the contract, they had the right to rescind the 36977 affirming the order for delivery of a copy of the contract to sell to private
contract in case private respondents breached the contract. respondents and to accept payment of the balance of the purchase
price and deliver title over the condominium unit to the private respondents upon full
In their Comment[19] and Memorandum,[20] private respondents alleged that they have payment of the balance of the purchase price.
not in fact received a copy of the contract to sell. Private respondents likewise averred that
petitioners assertion is premised on its completely wrong proposition that private No costs.
respondents had given petitioners a reason to rescind the contract to sell. What was really
SO ORDERED.
in issue was that it was petitioners that gave them sufficient and well-founded cause to
suspend payment of their monthly amortizations on the condominium unit.
We agree with private respondents.
The core issue actually boils down to the question of whether or not respondents
may suspend payment of their monthly amortizations due to failure of petitioners to furnish
them copy of the contract to sell.
Time and again, the Court had occasion to reiterate the well-established rule that
findings of fact of the Court of Appeals are conclusive on the parties and are not generally
reviewable by this Court.[21] We find no compelling reason to disturb the factual findings of
the Court of Appeals, in the absence of showing that the present case falls within the
exceptions to this rule.[22] When supported by sufficient evidence, the findings of fact of the
Court of Appeals affirming those of the trial court, are not to be disturbed on appeal. The
rationale behind this doctrine is that review of the findings of fact of the Court of Appeals is
not a function that the Supreme Court normally undertakes. In the case at bar, we
subscribe to the findings of fact of the Court of Appeals when it held that:
xxx
And contrary to petitioners stance, records disclose that they were the ones who did
fraudulent acts against private respondents by entering into a Contract to Sell with the
latter and accepting their downpayment of P878,366.35, withholding a copy thereof for no
valid reason at all, and then threatening them with rescission and forfeiture, when private
respondents only suspended payment of the balance of the purchase price while waiting
for their copy of the Contract to Sell.[23]
The private respondents are entitled to a copy of the contract to sell, otherwise they
would not be informed of their rights and obligations under the contract. When the
Sadhwanis parted with P878,366.35 or more than one third of the purchase price for the
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Land Titles and Deeds (Finals) 2017
[G.R. No. 118822. July 28, 1997] Petitioner imputes error to the Court of Appeals in not finding the true facts of the
case that greatly affected its decision, and its decision being contrary to law.
GOAL contends that the Court of Appeals failed to appreciate the fact that the
construction of the fifth floor was with the written approval of public respondent HLURB as
G.O.A.L., INC., petitioner, vs. COURT OF APPEALS, OFFICE OF THE RESIDENT required by Sec. 22 of P.D. 957 which provides -
LEGAL AFFAIRS, HOUSING AND LAND USE REGULATORY BOARD,
RIZALINO SIMBILLO, WILLIAM ONG, HERMINIA MESINA, SELFA
Sec. 22. Alteration of Plans. - No owner or developer shall change or alter the roads, open
MARTINEZ, FILOMENO TENG, RAFAEL JAVIER, FERNANDO DEL MUNDO,
spaces, infrastructures, facilities for public use and/or other form of subdivision
MILDRED PAREJA, REMEDIOS LASQUETE, GEORGE CABIGAN, and
development as contained in the approved subdivision plan and/or represented in its
ARCADIO SAMPANG, respondents.
advertisements, without the permission of the Authority and the written conformity or
consent of the duly organized homeowners association, or in the absence of the latter, by
DECISION majority of the lot buyers in the subdivision (underscoring supplied).
BELLOSILLO, J.:
The above provision is clear. We do not have to tussle with legal hermeneutics in the
interpretation of Sec. 22 of P.D. 957. The written approval of the National Housing
G. O. A. L., INC. (GOAL), in this petition for review on certiorari, seeks to set aside Authority alone is not sufficient. It must be coupled with the written conformity or consent of
part of the decision of the Court of Appeals dated 28 September 1994[1] which affirmed the the duly organized homeowners association or the majority of the lot buyers. Failing in this,
decision of the Office of the President Legal Affairs (OPLA) that earlier likewise affirmed the construction of the fifth floor is violative of the decree invoked. The Court of Appeals
the decision of the Housing and Land Use Regulatory Board (HLURB). Petitioner confines simply applied the law, and correctly so.
its petition to the construction of the fifth floor of Gemin I Condominium and all works
related thereto, including the issuance of title to private respondent Teng and providing Petitioner likewise contends that it should not have been faulted for failing to deliver
free parking spaces for the condominium units.[2] the title to private respondent Teng as the proximate cause thereof was the abandonment
of the construction project by the first contractor, hence, due to force majeure.[4]
On 23 May 1983 GOAL and the National Housing Authority (NHA) entered into an
agreement whereby NHA extended to GOAL a loan of P4.425 million for the construction We cannot sustain petitioner. There is no one else to blame but itself. Upon full
of Gemin I Condominium at 941 Gonzales St., Ermita, Manila.Sometime in 1984 a payment of the agreed price, petitioner is mandated by law to deliver the title of the lot or
Contract Agreement was entered into between GOAL and Matson International unit to the buyer. Both the Contract to Sell of petitioner and private respondents, and Sec.
Corporation for the construction of the condominium within one (1) year at the cost of P4.2 25 of P.D. 957 state -
million. However, in the later part of 1984, the contractor abandoned the project with only
60% of it finished. In 1985 GOAL offered the condominium units for sale with private Sec. III (Contract to Sell). - Title and Ownership of Unit. Upon full payment by the vendees
respondents among its buyers. To remedy the situation brought about by the of the full amount of the purchase price stipulated under Sec. III hereof, the assessments
abandonment of the project by the first contractor, GOAL subsequently pursued the and expenses under Sec. IV and otherwise upon compliance by the VENDEES of all
construction of the fifth floor with NHA granting additional funding on the condition that it obligations therein, the VENDOR will convey to the VENDEE all rights and interests of the
would hold on to the condominium certificates of title of private respondents. former and to the Unit, subject hereof together with the interest in the common area and in
In August 1989 private respondents filed with the Housing and Land Use Regulatory the Condominium Corporation appurtenant to such unit x x x x
Board (HLURB), Office of Appeals, Adjudication and Legal Affairs (OAALA), a complaint
against GOAL. Among the issues raised were the illegal construction of the fifth floor of Sec. 25, P.D. 957 - Issuance of Title. - The owner or developer shall deliver the title of the
Gemin I Condominium, the failure to deliver the title of private respondent Filomeno Teng lot or unit to the buyer upon full payment of the lot or unit x x x x In the event a mortgage
despite his repeated demands, and the failure to provide adequate parking spaces for the over the lot or unit is outstanding at the time of the issuance of the title to the buyer, the
unit owners. owner or developer shall redeem the mortgage or the corresponding portion thereof within
six months from such issuance in order that the title over any paid lot or unit may be
On 31 March 1989 OAALA rendered its decision ordering GOAL, inter alia, (a) to secured and delivered to the buyer in accordance herewith.
stop the construction of the fifth floor, (b) to deliver the title of private respondent Teng, and
(c) to provide adequate parking space for the unit owners. [3]
Petitioner also attempts to justify its failure to deliver the certificate of title of private
On appeal to the Office of the President Legal Affairs (OPLA) and subsequently to respondent Teng by claiming that it used the title as part collateral for the additional loan
the Court of Appeals, the decision rendered by the HLURB-OAALA was affirmed in NHA had extended for the construction of the fifth floor.
toto. Petitioner's motion for reconsideration was denied. Hence this petition.
The Court observes the frequent allusion of petitioner to its predicament brought
about by the abandonment of the project by the first contractor. But such is irrelevant in
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Land Titles and Deeds (Finals) 2017
light of Sec. 25 of P.D. 957 as well as of the Contract to Sell of the parties.While we Petitioner can hardly be excused for its failure to comply with the provisions of P.D.
empathize with petitioner in its financial dilemma we cannot make innocent parties suffer 957 by claiming ignorance of the requirements of the decree and that a mistake upon a
the consequences of the formers lack of business acumen. Upon full payment of a unit, doubtful or difficult question of law may be the basis of good faith. Being engaged in a
petitioner loses all its rights and interests to the unit in favor of the buyer. Consequently, it business affected by P.D. 957, petitioner should be aware of its provisions and its
has no right to use the certificate of title of respondent Teng as collateral for a new mandates which, as can be readily perceived, are clear, simple and unmistakable. [7]
loan. The title of Teng must be released to him as provided by law.
WHEREFORE, finding no error in the Decision sought to be reviewed, the petition is
With respect to the second issue, petitioner contends that the decision of the Court of DENIED. Costs against petitioner.
Appeals is contrary to law considering that under Sec. 12-D, No. 2, Rule V of the
Implementing Rules of P.D. 957, what should be given for free are only off-street parking SO ORDERED
spaces and not indoor parking areas.
Petitioner is wrong. It has for purposes of its own construed off-street to mean not
including indoor. On the other hand, the law does not exclude indoor parking. What it
specifically excludes is street parking. Therefore, parking may be in the basement or, in
the absence thereof, in the first floor.
Furthermore, at this point, a definition of terms may be necessary. In a condominium,
common areas and facilities are portions of the condominium property not included in the
units, whereas, a unit is a part of the condominium property which is to be subject to
private ownership.[5] Inversely, that which is not considered a unit should fall under
common areas and facilities.
Hence, the parking spaces not being subject to private ownership form part of the
common area over which the condominium unit owners hold undivided interest. As such,
petitioner cannot invoke Sec. I, Art. III, of the Bill of Rights which provides that No person
shall be deprived of life, liberty or property without due process of law. Petitioner alone
does not own the parking area. The parking space is owned in common by the developer
and the unit owners. Private respondents must be allowed to use the parking area.
Finally, petitioner contends that the payment of P10,000.00 as moral damages
and P5,000.00 as exemplary damages plus P5,000.00 as attorney's fees is too much of a
penalty. However, the Court of Appeals upheld these awards holding that -
In the light of the foregoing premises, we sense no error in the award of attorney's fees,
moral and exemplary damages, and administrative fines against petitioner. This is allowed
by the provisions of civil law and under Secs. 38 and 39 of P.D. 957:
Sec. 38. Administrative Fines. - The Authority may prescribe and impose fines not
exceeding ten thousand pesos for violations of the provisions of this Decree or any rule or
regulation thereunder. Fines shall be payable to the Authority and enforceable through
writs of execution in accordance with the provisions of the Rules of Court.
Sec. 39. Penalties - Any person who shall violate any of the provisions of this Decree
and/or any rule or regulation that may be issued pursuant to this Decree shall, upon
conviction, be punished by a fine of not more than twenty thousand (P20,000.00) pesos
and/or imprisonment of not more than ten years: Provided, that in the case of corporations,
partnership, cooperatives, or associations, the President, manager, or Administrator or the
person who has charge of the administration of the business shall be criminally
responsible for any violation of this Decree and/or the rules and regulations promulgated
pursuant thereto.[6]
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x --------------------------------------------------------------------------------------- x subdivision.
DECISION
ABAD, J.:
In answer, Ortigas alleged that its development plan for the subject land was for a
The Facts and the Case Justice through the Land Registration Commission on June 16, 1969; (2) by the Municipal
Council of Pasig under Resolution 128 dated May 27, 1969; and (3) by the Court of First
Petitioner Ortigas & Company, Limited Partnership (Ortigas), a realty company,
Instance of Rizal, Branch 25 in its Order dated July 11, 1969.
developed the Ortigas Center that straddled the three cities of Mandaluyong, Quezon, and
Pasig. This case concerns the Pasig City side of the commercial district known as the
Ortigas further alleged that only in 1984, 15 years after the approval of its plan, that the
Ortigas Center, known in 1969 as Capitol VI Subdivision.
National Housing Regulatory Commission imposed the open space requirement for
commercial subdivisions through its Rules and Regulations for Commercial Subdivision
In 1994 respondent City of Pasig (the City) filed a complaint against Ortigas and Greenhills
and Commercial Subdivision Development.
Properties, Inc. (GPI) for specific compliance before the Regional Trial Court (RTC) of
Pasig in Civil Case 64427. The City alleged that Ortigas failed to comply with Municipal
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Land Titles and Deeds (Finals) 2017
The case was heard on pre-trial but before it could be terminated, on January 23, 1996 The Issue Presented
Ortigas filed a motion to dismiss the case on the ground that the RTC had no jurisdiction
The sole issue in this case is whether or not the CA erred in affirming the lower courts
over it, such jurisdiction being in the Housing and Land Use Regulatory Board (HLURB) for
ruling that jurisdiction over the Citys action lies with the RTC, not with the HLURB.
unsound real estate business practices.
On April 15, 1996 the RTC denied the motion to dismiss. [1] It held that HLURBs jurisdiction
Ortigas maintains that the HLURB has jurisdiction over the complaint since a land
pertained to disputes arising from transactions between buyers, salesmen, and subdivision
developer's failure to comply with its statutory obligation to provide open spaces
and condominium developers. In this case, the City is a local government unit seeking to
constitutes unsound real estate business practice that Presidential Decree (P.D.) 1344
enforce compliance with a municipal ordinance, an action that is not within the scope of the
prohibits. Executive Order 648 empowers the HLURB to hear and decide claims of
disputes cognizable by the HLURB. With the denial of its motion for reconsideration on
unsound real estate business practices against land developers.
August 7, 1996, Ortigas filed a petition for certiorari before the Court of Appeals (CA) to
Judiciary Reorganization Act of 1980.[4] (c) cases involving specific performance of contractual and
statutory obligations filed by buyers of subdivision lots or condominium
units against the owner, developer, dealer, broker or salesman.
The CA denied Ortigas motion for reconsideration on June 27, 1997, prompting it to file the
Unlike paragraphs (b) and (c) above, paragraph (a) does not state which party
present petition for review.
can file a claim against an unsound real estate business practice. But, in the context of the
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Land Titles and Deeds (Finals) 2017
evident objective of Section 1, it is implicit that the unsound real estate business practice
would, like the offended party in paragraphs (b) and (c), be the buyers of lands involved in
development. The policy of the law is to curb unscrupulous practices in real estate trade
Sarmiento[7] that not every case involving buyers and sellers of subdivision lots or
condominium units can be filed with the HLURB. Its jurisdiction is limited to those cases
filed by the buyer or owner of a subdivision lot or condominium unit and based on any of
Obviously, the City had not bought a lot in the subject area from Ortigas which
would give it a right to seek HLURB intervention in enforcing a local ordinance that
regulates the use of private land within its jurisdiction in the interest of the general
welfare. It has the right to bring such kind of action but only before a court of general
WHEREFORE, the Court DISMISSES the petition, AFFIRMS the Court of Appeals
Decision in CA-G.R. SP 42270 dated February 18, 1997, and ORDERS the Regional Trial
Court of Pasig City, Branch 166, to hear and decide the case before it with deliberate
dispatch.
SO ORDERED.