G.R. No.

160895 October 30, 2006

JOSE R. MARTINEZ, petitioner,

DECISION

TINGA, J.:

The central issue presented in this Petition for Review is whether an order of general default issued by a
trial court in a land registration case bars the Republic of the Philippines, through the Office of the
Solicitor General, from interposing an appeal from the trial court’s subsequent decision in favor of the
applicant.

The antecedent facts follow.

On 24 February 1999, petitioner Jose R. Martinez (Martinez) filed a petition for the registration in his
name of three (3) parcels of land included in the Cortes, Surigao del Sur Cadastre. The lots, individually
identified as Lot No. 464-A, Lot No. 464-B, and Lot No. 370, Cad No. 597, collectively comprised
around 3,700 square meters. Martinez alleged that he had purchased lots in 1952 from his uncle, whose
predecessors-in-interest were traceable up to the 1870s. It was claimed that Martinez had remained in
continuous possession of the lots; that the lots had remained unencumbered; and that they became private
property through prescription pursuant to Section 48(b) of Commonwealth Act No. 141. Martinez further
claimed that he had been constrained to initiate the proceedings because the Director of the Land
Management Services had failed to do so despite the completion of the cadastral survey of Cortes,
Surigao del Sur.1

The case was docketed as Land Registration Case No. N-30 and raffled to the Regional Trial Court (RTC)
of Surigao del Sur, Branch 27. The Office of the Solicitor General (OSG) was furnished a copy of the
petition. The trial court set the case for hearing and directed the publication of the corresponding Notice
of Hearing in the Official Gazette. On 30 September 1999, the OSG, in behalf of the Republic of the
Philippines, opposed the petition on the grounds that appellee’s possession was not in accordance with
Section 48(b) of Commonwealth Act No. 141; that his muniments of title were insufficient to prove bona-
fide acquisition and possession of the subject parcels; and that the properties formed part of the public
domain and thus not susceptible to private appropriation.2

Despite the opposition filed by the OSG, the RTC issued an order of general default, even against the
Republic of the Philippines, on 29 March 2000. This ensued when during the hearing of even date, no
party appeared before the Court to oppose Martinez’s petition.3

Afterwards, the trial court proceeded to receive Martinez’s oral and documentary evidence in support of
his petition. On 1 August 2000, the RTC rendered a Decision4 concluding that Martinez and his
predecessors-in-interest had been for over 100 years in possession characterized as continuous, open,
public, and in the concept of an owner. The RTC thus decreed the registration of the three (3) lots in the
name of Martinez.

From this Decision, the OSG filed a Notice of Appeal dated 28 August 2000,5 which was approved by the
RTC. However, after the records had been transmitted to the Court of Appeals, the RTC received a letter
dated 21 February 20016 from the Land Registration Authority (LRA) stating that only Lot Nos. 464-A
and 464-B were referred to in the Notice of Hearing published in the Official Gazette; and that Lot No.
370, Cad No. 597 had been deliberately omitted due to the lack of an approved survey plan for that
property. Accordingly, the LRA manifested that this lot should not have been adjudicated to Martinez for
lack of jurisdiction. This letter was referred by the RTC to the Court of Appeals for appropriate action.7

On 10 October 2003, the Court of Appeals promulgated the assailed Decision,8 reversing the RTC and
instead ordering the dismissal of the petition for registration. In light of the opposition filed by the OSG,
the appellate court found the evidence presented by Martinez as insufficient to support the registration of
the subject lots. The Court of Appeals concluded that the oral evidence presented by Martinez merely
consisted of general declarations of ownership, without alluding to specific acts of ownership performed
by him or his predecessors-in-interest. It likewise debunked the documentary evidence presented by
Martinez, adjudging the same as either inadmissible or ineffective to establish proof of ownership.

No motion for reconsideration appears to have been filed with the Court of Appeals by Martinez, who
instead directly assailed its Decision before this Court through the present petition.

We cannot help but observe that the petition, eight (8) pages in all, was apparently prepared with all
deliberate effort to attain nothing more but the perfunctory. The arguments raised center almost
exclusively on the claim that the OSG no longer had personality to oppose the petition, or appeal its
allowance by the RTC, following the order of general default. Starkly put, "the [OSG] has no personality
to raise any issue at all under the circumstances pointed out hereinabove." 9 Otherwise, it is content in
alleging that "[Martinez] presented sufficient and persuasive proof to substantiate the fact that his title to
Lot Nos. 464-A and 464-B is worth the confirmation he seeks to be done in this registration case";10 and
that the RTC had since issued a new Order dated 1 September 2003, confirming Martinez’s title over Lot
No. 370.

In its Comment dated 24 May 2004,11 the OSG raises several substantial points, including the fact that it
had duly opposed Martinez’s application for registration before the RTC; that jurisprudence and the Rules
of Court acknowledge that a party in default is not precluded from appealing the unfavorable judgment;
that the RTC had no jurisdiction over Lot No. 370 since its technical description was not published in the
Official Gazette; and that as found by the Court of Appeals the evidence presented by Martinez is
insufficient for registering the lots in his name.12 Despite an order from the Court requiring him to file a
Reply to the Comment, counsel for Martinez declined to do so, explaining, among others, that "he felt he
would only be taxing the collective patience of this [Court] if he merely repeats x x x what petitioner had
succinctly stated x x x on pages four (4) to seven (7) of his said petition." Counsel for petitioner was
accordingly fined by the Court.13

The Court’s patience is taxed less by redundant pleadings than by insubstantial arguments. The inability
of Martinez to offer an effective rebuttal to the arguments of the OSG further debilitates what is an
already weak petition.

The central question, as posed by Martinez, is whether the OSG could have still appealed the RTC
decision after it had been declared in default. The OSG argues that a party in default is not precluded from
filing an appeal, citing Metropolitan Bank & Trust Co. v. Court of Appeals,14 and asserts that "[t]he Rules
of Court expressly provides that a party who has been declared in default may appeal from the judgment
rendered against him."15

There is error in that latter, unequivocal averment, though one which does not deter from the ultimate
correctness of the general postulate that a party declared in default is allowed to pose an appeal.
Elaboration is in order.

We note at the onset that the OSG does not impute before this Court that the RTC acted improperly in
declaring public respondent in default, even though an opposition had been filed to Martinez’s petition.
Under Section 26 of Presidential Decree No. 1529, as amended, the order of default may be issued "[i]f
no person appears and answers within the time allowed." The RTC appears to have issued the order of
general default simply on the premise that no oppositor appeared before it on the hearing of 29 March
2000. But it cannot be denied that the OSG had already duly filed its Opposition to Martinez’s petition
long before the said hearing. As we held in Director of Lands v. Santiago:16

[The] opposition or answer, which is based on substantial grounds, having been formally filed, it
was improper for the respondent Judge taking cognizance of such registration case to declare the
oppositor in default simply because he failed to appear on the day set for the initial healing. The
pertinent provision of law which states: "If no person appears and answers within the time
allowed, the court may at once upon motion of the applicant, no reason to the contrary appearing,
order a general default to be recorded . . . ," cannot be interpreted to mean that the court can just
disregard the answer before it, which has long been filed, for such an interpretation would be
nothing less than illogical, unwarranted, and unjust. Had the law intended that failure of the
oppositor to appear on the date of the initial hearing would be a ground for default despite his
having filed an answer, it would have been so stated in unmistakable terms, considering the
serious consequences of an order of default. Especially in this case where the greater public
interest is involved as the land sought to be registered is alleged to be public land, the respondent
Judge should have received the applicant's evidence and set another date for the reception of the
oppositor's evidence. The oppositor in the Court below and petitioner herein should have been
accorded ample opportunity to establish the government's claim.17

Strangely, the OSG did not challenge the propriety of the default order, whether in its appeal before the
Court of Appeals or in its petition before this Court. It would thus be improper for the Court to make a
pronouncement on the validity of the default order since the same has not been put into issue.
Nonetheless, we can, with comfort, proceed from same apparent premise of the OSG that the default
order was proper or regular.

The juridical utility of a declaration of default cannot be disputed. By forgoing the need for adversarial
proceedings, it affords the opportunity for the speedy resolution of cases even as it penalizes parties who
fail to give regard or obedience to the judicial processes.

The extent to which a party in default loses standing in court has been the subject of considerable
jurisprudential debate. Way back in 1920, in Velez v. Ramas,18 we declared that the defaulting defendant
"loses his standing in court, he not being entitled to the service of notices in the case, nor to appear in the
suit in any way. He cannot adduce evidence; nor can he be heard at the final hearing." 19 These restrictions
were controversially expanded in Lim Toco v. Go Fay,20 decided in 1948, where a divided Court
pronounced that a defendant in default had no right to appeal the judgment rendered by the trial court,
except where a motion to set aside the order of default had been filed. This, despite the point raised by
Justice Perfecto in dissent that there was no provision in the then Rules of Court or any law "depriving a
defaulted defendant of the right to be heard on appeal."21

The enactment of the 1964 Rules of Court incontestably countermanded the Lim Toco ruling. Section 2,
Rule 41 therein expressly stated that "[a] party who has been declared in default may likewise appeal
from the judgment rendered against him as contrary to the evidence or to the law, even if no petition for
relief to set aside the order of default has been presented by him in accordance with Rule 38."22 By clearly
specifying that the right to appeal was available even if no petition for relief to set aside the order of
default had been filed, the then fresh Rules clearly rendered the Lim Toco ruling as moot.

Another provision in the 1964 Rules concerning the effect of an order of default acknowledged that "a
party declared in default shall not be entitled to notice of subsequent proceedings, nor to take part in the
trial."23 Though it might be argued that appellate proceedings fall part of "the trial" since there is no final
termination of the case as of then, the clear intent of the 1964 Rules was to nonetheless allow the
defaulted defendant to file an appeal from the trial court decision. Indeed, jurisprudence applying the
1964 Rules was unhesitant to affirm a defaulted defendant’s right to appeal, as guaranteed under Section
2 of Rule 41, even as Lim Toco was not explicitly abandoned.

In the 1965 case of Antonio, et al. v. Jacinto,24 the Court acknowledged that the prior necessity of a ruling
setting aside the order of default "however, was changed by the Revised Rules of Court. Under Rule 41,
section 2, paragraph 3, a party who has been declared in default may likewise appeal from the judgment
rendered against him as contrary to the evidence or to the law, even if no petition for relief to set aside the
order of default has been presented by him in accordance with Rule 38." 25 It was further qualified in
Matute v. Court of Appeals26 that the new availability of a defaulted defendant’s right to appeal did not
preclude "a defendant who has been illegally declared in default from pursuing a more speedy and
efficacious remedy, like a petition for certiorari to have the judgment by default set aside as a nullity." 27

In Tanhu v. Ramolete,28 the Court cited with approval the commentaries of Chief Justice Moran,
expressing the reformulated doctrine that following Lim Toco, a defaulted defendant "cannot adduce
evidence; nor can he be heard at the final hearing, although [under Section 2, Rule 41,] he may appeal the
judgment rendered against him on the merits."29

Thus, for around thirty-odd years, there was no cause to doubt that a defaulted defendant had the right to
appeal the adverse decision of the trial court even without seeking to set aside the order of default. Then,
in 1997, the Rules of Civil Procedure were amended, providing for a new Section 2, Rule 41. The new
provision reads:

SECTION 1. Subject of appeal.—An appeal may be taken from a judgment or final order that
completely disposes of the case, or of a particular matter therein when declared by these Rules to
be appealable.

No appeal may be taken from:

(a) An order denying a motion for new trial or reconsideration;

(b) An order denying a petition for relief or any similar motion seeking relief from judgment;

(c) An interlocutory order;

(d) An order disallowing or dismissing an appeal;

(f) An order of execution;

(g) A judgment or final order for or against or one or more of several parties or in separate claims,
counterclaims, cross-claims and third-party complaints, while the main case is pending, unless the
court allows an appeal therefrom; and

(h) An order dismissing an action without prejudice.

In all the above instances where the judgment or final order is not appealable, the aggrieved party
may file an appropriate special civil action under Rule 65.

Evidently, the prior warrant that a defaulted defendant had the right to appeal was removed from Section
2, Rule 41. On the other hand, Section 3 of Rule 9 of the 1997 Rules incorporated the particular effects on
the parties of an order of default:

Sec. 3. Default; declaration of.—If the defending party fails to answer within the time allowed
therefor, the court shall, upon motion of the claiming party with notice to the defending party, and
proof of such failure, declare the defending party in default. Thereupon, the court shall proceed to
render judgment granting the claimant such relief as his pleading may warrant, unless the court in
its discretion requires the claimant to submit evidence. Such reception of evidence may be
delegated to the clerk of court.

(a) Effect of order of default.—A party in default shall be entitled to notice of subsequent
proceedings but shall not take part in the trial.

(b) Relief from order of default.—A party declared in default may any time after notice thereof
and before judgment file a motion under oath to set aside the order of default upon proper
showing that his failure to answer was due to fraud, accident, mistake or excusable negligence
and that he has a meritorious defense. In such case, the order of default may be set aside on such
terms and conditions as the judge may impose in the interest of justice.

(c) Effect of partial default.—When a pleading asserting a claim states a common cause of action
against several defending parties, some of whom answer and the others fail to do so, the court
shall try the case against all upon the answers thus filed and render judgment upon the evidence
presented.

(d) Extent of relief to be awarded.—A judgment rendered against a party in default shall not
exceed the amount or be different in kind from that prayed for nor award unliquidated damages.

xxx

It cannot be escaped that the old provision expressly guaranteeing the right of a defendant declared in
default to appeal the adverse decision was not replicated in the 1997 Rules of Civil Procedure. Should this
be taken as a sign that under the 1997 Rules a defaulted defendant no longer has the right to appeal the
trial court decision, or that the Lim Toco doctrine has been reinstated?
If post-1997 jurisprudence and the published commentaries to the 1997 Rules were taken as an indication,
the answer should be in the negative. The right of a defaulted defendant to appeal remains extant.

By 1997, the doctrinal rule concerning the remedies of a party declared in default had evolved into a
fairly comprehensive restatement as offered in Lina v. Court of Appeals:30

a) The defendant in default may, at any time after discovery thereof and before judgment, file a
motion, under oath, to set aside the order of default on the ground that his failure to answer was
due to fraud, accident, mistake or excusable neglect, and that he has meritorious defenses; (Sec 3,
Rule 18)

b) If the judgment has already been rendered when the defendant discovered the default, but
before the same has become final and executory, he may file a motion for new trial under Section
1(a) of Rule 37;

c) If the defendant discovered the default after the judgment has become final and executory, he
may file a petition for relief under Section 2 of Rule 38; and

d) He may also appeal from the judgment rendered against him as contrary to the evidence or to
the law, even if no petition to set aside the order of default has been presented by him. (Sec. 2,
Rule 41)31

The fourth remedy, that of appeal, is anchored on Section 2, Rule 41 of the 1964 Rules. Yet even after
that provision’s deletion under the 1997 Rules, the Court did not hesitate to expressly rely again on the
Lina doctrine, including the pronouncement that a defaulted defendant may appeal from the judgment
rendered against him. This can be seen in the cases of Indiana Aerospace University v. Commission on
Higher Education,32 Tan v. Dumarpa,33 and Crisologo v. Globe Telecom, Inc.34

Annotated textbooks on the 1997 Rules of Civil Procedure similarly acknowledge that even under the
new rules, a defaulted defendant retains the right to appeal as previously confirmed under the old Section
2, Rule 41. In his textbook on Civil Procedure, Justice Francisco answers the question "What are the
remedies available to a defending party in default?" with a reiteration of the Lina doctrine, including the
remedy that a defaulted defendant "may also appeal from the judgment rendered against him as contrary
to the evidence or to the law, even if no petition to set aside the order of default has been presented by
him."35 Justice Regalado also restates the Lina rule in his textbook on Civil Procedure, opining that the
remedies enumerated therein, even if under the former Rules of Procedure, "would hold true under the
present amended Rules."36 Former Court of Appeals Justice Herrerra likewise reiterates the Lina doctrine,
though with the caveat that an appeal from an order denying a petition for relief from judgment was no
longer appealable under Section 1, Rule 41 of the 1997 Rules.37 Herrera further adds:

Section 2, paragraph [2] of the former Rule 41, which allows an appeal from a denial of a petition
for relief, was deleted from the present Rule, and confined appeals to cases from a final judgment
or final order that completely disposes of the case, or of a particular matter therein, when declared
by these rules to be appealable. A judgment by default may be considered as one that
completely disposes of the case.38

We are hard-pressed to find a published view that the enactment of the 1997 Rules of Civil Procedure
accordingly withdrew the right, previously granted under the 1964 Rules, of a defaulted defendant to
appeal the judgment by default against him. Neither is there any provision under the 1997 Rules which
expressly denies the defaulted defendant such a right. If it is perplexing why the 1997 Rules deleted the
previous authorization under the old Section 2, Rule 41 (on subject of appeal), it is perhaps worth noting
that its counterpart provision in the 1997 Rules, now Section 1, Rule 41, is different in orientation even as
it also covers "subject of appeal." Unlike in the old provision, the bulk of the new provision is devoted to
enumerating the various rulings from which no appeal may be taken, and nowhere therein is a judgment
by default included. A declaration therein that a defaulted defendant may still appeal the judgment by
default would have seemed out of place.

Yet even if it were to assume the doubtful proposition that this contested right of appeal finds no anchor
in the 1997 Rules, the doctrine still exists, applying the principle of stare decisis. Jurisprudence applying
the 1997 Rules has continued to acknowledge the Lina doctrine which embodies this right to appeal as
among the remedies of a defendant, and no argument in this petition persuades the Court to rule
otherwise.

In Rural Bank of Sta. Catalina v. Land Bank of the Philippines,39 the Court, through Justice Callejo, Sr.,
again provided a comprehensive restatement of the remedies of the defending party declared in default,
which we adopt for purposes of this decision:

It bears stressing that a defending party declared in default loses his standing in court and his
right to adduce evidence and to present his defense. He, however, has the right to appeal from the
judgment by default and assail said judgment on the ground, inter alia, that the amount of the
judgment is excessive or is different in kind from that prayed for, or that the plaintiff failed to
prove the material allegations of his complaint, or that the decision is contrary to law. Such party
declared in default is proscribed from seeking a modification or reversal of the assailed decision
on the basis of the evidence submitted by him in the Court of Appeals, for if it were otherwise, he
would thereby be allowed to regain his right to adduce evidence, a right which he lost in the trial
court when he was declared in default, and which he failed to have vacated. In this case, the
petitioner sought the modification of the decision of the trial court based on the evidence
submitted by it only in the Court of Appeals.40

If it cannot be made any clearer, we hold that a defendant party declared in default retains the right to
appeal from the judgment by default on the ground that the plaintiff failed to prove the material
allegations of the complaint, or that the decision is contrary to law, even without need of the prior filing
of a motion to set aside the order of default. We reaffirm that the Lim Toco doctrine, denying such right to
appeal unless the order of default has been set aside, was no longer controlling in this jurisdiction upon
the effectivity of the 1964 Rules of Court, and up to this day.

Turning to the other issues, we affirm the conclusion of the Court of Appeals that Martinez failed to
adduce the evidence needed to secure the registration of the subject lots in his name.

It should be noted that the OSG, in appealing the case to the Court of Appeals, did not introduce any new
evidence, but simply pointed to the insufficiency of the evidence presented by Martinez before the trial
court. The Court of Appeals was careful to point out that the case against Martinez was established not by
the OSG’s evidence, but by petitioner’s own insufficient evidence. We adopt with approval the following
findings arrived at by the Court of Appeals, thus:

The burden of proof in land registration cases is incumbent on the applicant who must show that
he is the real and absolute owner in fee simple of the land applied for. Unless the applicant
succeeds in showing by clear and convincing evidence that the property involved was acquired by
him or his ancestors by any of the means provided for the proper acquisition of public lands, the
rule is settled that the property must be held to be a part of the public domain. The applicant must,
therefore, present competent and persuasive proof to substantiate his claim. He may not rely on
general statements, or mere conclusions of law other than factual evidence of possession and title.

Considered in the light of the opposition filed by the Office of the Solicitor General, we find the
evidence adduced by appellee, on the whole, insufficient to support the registration of the subject
parcels in his name. To prove the provenance of the land, for one, all that appellee proffered by
way of oral evidence is the following cursory testimony during his direct examination, viz:

xxxx

Q You mentioned that you are the owner of these three (3) parcels of land. How did you begin the
ownership of the same?

A I bought it from my uncles Julian Martinez and Juan Martinez.

xxxx

Q x x x x Who took possession of these parcels of land from then on?

A I took possession, sir

Q As owner?

A Yes, as owner.

Q Up to the present who is in possession as owner of these parcels of land?

A I took possession.

Q Before Julian Martinez and Juan Martinez sold these parcels of land before you took
possession who were the owners and in possession of these?

A Hilarion Martinez, the father of my predecessors-in-interest and also my grandfather.

xxxx

Court:

Q Of your own knowledge[,] where [sic] did your grandfather Hilarion Martinez acquire these
lands?

A According to my grandfather he bought that land from a certain Juan Casano in the year
1870’s[,] I think.

xxxx

Q By the way[,] when did your grandfather Hilarion Martinez die?

A Either in 1920 or 1921.

A Yes, sir.

xxxx

In the dreary tradition of most land registration cases, appellee has apparently taken the
absence of representation for appellant at the hearing of his petition as license to be
perfunctory in the presentation of his evidence. Actual possession of land, however, consists
in the manifestation of acts of dominion over it of such a nature as a party would naturally
exercise over his own property. It is not enough for an applicant to declare himself or his
predecessors-in-interest the possessors and owners of the land for which registration is
sought. He must present specific acts of ownership to substantiate the claim and cannot just
offer general statements which are mere conclusions of law requiring evidentiary support
and substantiation.

The record shows that appellee did not fare any better with the documentary evidence he adduced
before the trial court. The October 20, 1952 Deed of Sale by which appellee claims to have
purchased the subject parcels from his uncle, Julian Martinez, was not translated from the
vernacular in which it was executed and, by said token, was inadmissible in evidence.
Having submitted a white print copy of the survey plan for Lot Nos. 464-A and 464-B,
appellee also submitted the tracing cloth plan for Lot No. 370 which does not, however,
appear to be approved by the Director of Lands. In much the same manner that the submission
of the original tracing cloth plan is a mandatory statutory requirement which cannot be waived,
the rule is settled that a survey plan not approved by the Director of Lands is not admissible in
evidence.41

These findings of the Court of Appeals, arrived at after a sufficiently extensive evaluation of the evidence,
stand in contrast to that contained in the RTC decision, encapsulated in a one-paragraph précis of the
factual allegations of Martinez concerning how he acquired possession of the subject properties. The
Court of Appeals, of course, is an appropriate trier of facts, and a comparison between the findings of fact
of the Court of Appeals and that of the RTC clearly demonstrates that it was the appellate court which
reached a more thorough and considered evaluation of the evidence.

As correctly held by the Court of Appeals, the burden of proof expected of the petitioner in a land
registration case has not been matched in this case.

WHEREFORE, the petition is DISMISSED. Costs against petitioner.