G.R. No.

183589 June 25, 2014

CHARLIE LIM vs. SPOUSES DANILO LIGON and GENEROSA VITUG-LIGON

Facts:
Sometime in 1970, one Tomas Fernandez filed a Free Patent Application over a parcel of land
situated in Sitio Kuala, Barangay Wawa, Nasugbu, Batangas. After the death of Tomas
Fernandez, his son Felicisimo pursued the application and on 25 April 1984, the survey plan
was approved by the Bureau of Lands. The spouses Isaac and Concepcion Ronulo asked the
assistance of the Office of the President and requested investigation of their claim that a
parcel of land which they have been occupying since the 1950s was included in the approved
survey plan in the name of Tomas Fernandez.
The Office of the President referred the matter to the Bureau of Lands which in turn referred
the same to the DENR-Region IVB for appropriate action.
Regional Director Antonio Prinsipe of DENR Provisional Region IV-A issued an Order in favor
of spouses Isaac and Concepcion Ronulo, ordering the cancellation of the plan approved in
the name of Tomas Fernandez. The order was appealed by Felicisimo Fernandez to the Office
of the DENR Secretary.
The already widowed Concepcion Ronulo executed an Affidavit of Waiver of Rights over the
parcel of land subject of DENR Case in favor of herein defendant Lim who will "file the
appropriate public land application", to which the children of Concepcion Ronulo executed an
affidavit of conformity to the waiver, conveyance and transfer of the property.
In the meantime, herein plaintiffs Spouses Danilo Ligon and Generosa Vitug-Ligon purchased
the subject property from Felicisimo Fernandez and introduced improvements thereon,
including a beach house. Defendant Lim filed a complaint for forcible entry against the
petitioners with the Municipal Trial Court of Nasugbu, Batangas involving the subject property.
The trial court rendered judgment in favor of private respondent and ordered petitioners to
vacate the subject land. The trial court based its decision on the alleged finality of the Order
issued by Regional Director Prinsipe in DENR Case.
Plaintiffs appealed the adverse decision to the Regional Trial Court of Nasugbu, Batangas but
the same was affirmed.
Plaintiffs appealed the RTC decision to the Court of Appeals by way of a petition for review.
However, the Court of Appeals dismissed the petition.
The DENR Secretary rendered a decision reversing the order of Regional Director Prinsipe,
dismissing the protest of the Ronulos, and ordering that TCT No. TP-1792 in the name of
plaintiffs "shall remain undisturbed."
The Ronulos filed a motion for reconsideration of the above decision. The DENR Secretary
denied the motion for reconsideration. The Ronulos filed a second motion for reconsideration
of the decision of the DENR Secretary
Meanwhile, as a result of the finality of the judgment in the ejectment case, plaintiffs were
evicted from the subject property. They filed the instant suit before this Court, a complaint
against defendant Lim and his representative, Lilia Salanguit, for Quieting of Title, Recovery
of Possession and Damages with prayer for a TRO and Preliminary Injunction, to restore them
to their possession of the subject property and to enjoin herein defendant Lim from
demolishing their beach house.
The Court denied plaintiffs’ application for injunctive relief. During the pre-trial, the parties
agreed to hold hearings on 25 September, 06 October and 20 October 2000. However, the
first two hearing dates were cancelled at the instance of the defendants. During the scheduled
hearing on 20 October 2000, defendant and counsel did not appear. Instead, Judge Antonio
de Sagun, then the Honorable Presiding Judge informed plaintiffs that herein defendant Lim
filed a Motion to Suspend Proceedings on the ground that the denial of the second motion for
reconsideration in DENR Case No. 5102 was appealed to the Office of the President. In his
motion, defendant alleged that trial should be suspended pending "final adjudication of the
DENR case before the Office of the President where the issue of validity of plaintiff’s title is
squarely involved.
The Court granted the motion to suspend proceedings. Petitioners filed a motion for
reconsideration but the same was denied by then Presiding Judge Antonio de Sagun.
Plaintiffs filed a Petition for Certiorari before the Court of Appeals, assailing the suspension of
proceedings ordered by this Honorable Court which, after due proceedings, was granted and
the Order issued by this Court suspending the proceedings of this case reversed and set aside
in a Decision of the said appellate court.
No motion for reconsideration or any appellate recourse to the Supreme Court having been
interposed by defendants, plaintiffs moved to set this case for further proceedings. The Court
granted the motion.
In view of the absence of the defendants and their counsel despite due notice, evidence for
plaintiffs was presented ex-parte with plaintiff Danilo Ligon taking the witness stand. After
plaintiff’s direct examination, the Court ordered a resetting of the case for cross-examination
by defendants. Counsel and his witness plaintiff Danilo Ligon were present during the
scheduled trial in which defendants were properly notified. Defendants and counsel were
absent prompting this Honorable Court, upon plaintiff’s motion to consider the cross-
examination of plaintiff Danilo Ligon by defendants as waived; the continued absence of the
defendants as indicative of lack of interest to further defend this case; Grant plaintiff’s motion
for ten (10) days within which to file Formal Offer of Evidence and thirty (30) days from
November 18, 2002, within which to file their Memorandum. After which, this case will be
deemed submitted for decision.
Petitioners appealed the RTC decision with the CA. The appellate court however,
dismissed the appeal.
Petitioners moved for reconsideration while respondents filed their Opposition To Motion For
Reconsideration in compliance with the directive of the appellate court. In a Resolution, the
CA denied reconsideration for lack of merit. Hence, this appeal raising the following issues:

Issue:
1. Whether the finality of the judgment in the ejectment case served as res judicata with
respect to the issue of prior possession of the spouses Ronulos.

HELD:

1. No. For a judgment to constitute res judicata, the following requisites must concur:
x x x (a) the former judgment was final; (b) the court that rendered it had jurisdiction over
the subject matter and the parties; (c) the judgment was based on the merits; and (d)
between the first and the second actions, there was an identity of parties, subject matters,
and causes of action.
Res judicata embraces two concepts: (1) bar by prior judgment and (2) conclusiveness of
judgment.
Bar by prior judgment exists "when, as between the first case where the judgment was
rendered and the second case that is sought to be barred, there is identity of parties, subject
matter, and causes of action."
On the other hand, the concept of conclusiveness of judgment finds application "when a fact
or question has been squarely put in issue, judicially passed upon, and adjudged in a former
suit by a court of competent jurisdiction." This principle only needs identity of parties and
issues to apply.
Neither bar by prior judgment nor conclusiveness of judgment applies to the case at bar.
While there is identity of parties and subject matter between the instant case and the matter
before the DENR and later the OP, the causes of action are not the same. The present case
arose from a case for quieting of title where the plaintiff must show or prove legal or equitable
title to or interest in the property which is the subject-matter of the action. Legal title denotes
registered ownership, while equitable title means beneficial ownership. Without proof of such
legal or equitable title, or interest, there is no cloud to be prevented or removed. The
administrative proceedings before the DENR and now the OP, on the other hand, were
instituted on behalf of the Director of Lands, in order to investigate any allegation of
irregularity in securing a patent and the corresponding title to a public land under Section 91
of the Public Land Act.
Given the lack of identity of the issue involved in the instant case vis-à-vis the issue in the
administrative proceedings before the DENR and the OP, there can also be no bar by
conclusiveness of judgment.
Petitioner: Aneco Realty and Development Corporation

Respondent: Landex Development Corporation

Facts:

1. Fernandez Hermanos Development, Inc. (FHDI) is the original owner of a tract of land in
San Francisco Del Monte, Quezon City and it subdivided the land into 39 lots. It sold 22 lots
to Aneco and the remaining 17 to Landex.

2. Landex started the construction of a concrete wall on one of its lots. To stop the
construction, Aneco filed a complaint for injunction with the RTC in Quezon City.

3. Landex: Aneco was not deprived access to its lots due to the construction of the concrete
wall. Aneco has its own entrance to its property. The Resthaven Street access, however,
was rendered inaccessible when Aneco constructed a building on said street. Also, Landex
claimed that FHDI sold ordinary lots, not subdivision lots, to Aneco based on the express
stipulation in the deed of sale that FHDI was not interested in pursuing its own subdivision
project.

4. RTC granted the complaint for injunction. Landex filed a Motion for Reconsideration. RTC
granted the motion for reconsideration of Landex.

RTC Decision:

The property in question never did exist as a subdivision, the limitations imposed by
Section 1 of Republic Act No. 440, that no portion of a subdivision road lot shall be
closed without the approval of the Court is clearly inappropriate to the case at bar.

That plaintiff’s property is not isolated as it is bounded by Miller St.

and Resthaven St. Plaintiff could easily make an access to a public road within
the bounds and limits of its own property; and that the defendant has not yet
been indemnified whatsoever for the use of his property, as mandated by the Bill of
rights. The foregoing circumstances, negates the alleged plaintiffs right of
way.

CA affirmed RTC Decision:

The subject property ceased to be a road lot when its former owner
(Fernandez Hermanos, Inc.) sold it to appellant Aneco not as subdivision lots and
without the intention of pursuing the subdivision project.

The law in point is Article 624 of the New Civil Code. This provision allows the
continued use of an apparent easement should the owner alienate the property to
different persons. The easement that used to exist on the subject lot ceased
when appellant Aneco and the former owner agreed that the lots would be
consolidated and would no longer be intended as a subdivision project.

Re compulsory easement of right of way: Aneco failed to prove the essential

requisites to avail such right:

The essential requisites are:

1) that the dominant estate is surrounded by other immovables and has no

adequate outlet to a public highway;

2) that proper indemnity has been paid;

 3) that the isolation was not due to acts of the proprietor of the dominant estate;

4) that the right of way claimed is at a point least prejudicial to the servient estate
and in so far as consistent with this rule, where the distance from the dominant
estate to a public highway may be the shortest

Issue: Whether or not Aneco may enjoin Landex from constructing a concrete wall on its
own property (W/N Aneco should be given the right of way – NO)

Ruling: Court dismissed the complaint for injunction.

What is involved here is an undue interference on the property rights of a landowner to

build a concrete wall on his own property. It is a simple case of a neighbor, petitioner
Aneco, seeking to restrain a landowner, respondent Landex, from fencing his own land.

Article 430 of the Civil Code gives every owner the right to enclose or fence his
land or tenement by means of walls, ditches, hedges or any other means. The right
to fence flows from the right of ownership. As owner of the land, Landex may fence
his property subject only to the limitations and restrictions provided by law.
Absent a clear legal and enforceable right, as here, We will not interfere with the
exercise of an essential attribute of ownership.

Aneco cannot rely on the road lot under the old subdivision project of FHDI because it knew
at the time of the sale that it was buying ordinary lots, not subdivision lots, from FHDI. If
Aneco wants to transform its own lots into a subdivision project, it must make its own
provision for road lots.

WILLIAM ANGHIAN SIY, petitioner vs. ALVIN TOMLIN, respondent.

G.R. No. 205998
April 24, 2017

Facts:

On July 2011, petitioner William Anghian Siy filed a Complaint for Recovery of Possession
with Prayer for Replevin against Frankie Domanog Ong (Ong), Chris Centeno (Centeno),
John Co Chua (Chua), and respondent Alvin Tomlin. The petition which was filed before the
Quezon City RTC, alleged the following:

Petitioner is the owner of a 2007 model Range Rover with Plate Number ZMG 272 which he
purchased from Alberto Lopez on July 22, 2009.

In 2010, he entrusted the said vehicle to Ong, a businessman who owned a second-hand
car sales showroom, after the latter claimed that he had a prospective buyer. Ong failed to
remit the proceeds of the purported sale nor return the vehicle. The petitioner found out
that the vehicle had been transferred to Chua, and later learned that the vehicle was being
transferred to respondent.

On August 17, 2011, respondent filed an Omnibus Motion seeking to quash the Writ of
Replevin, dismiss the Complaint, and turn over the vehicle to him.
The RTC denied respondent’s Omnibus Motion while the CA reversed it.

Issue:

Whether or not the Writ of Replevin be issued for the return of the vehicle to petitioner.

Held:

No. “In a complaint of replevin, the claimant must convincingly show that he is the owner or
clearly entitled to the possession of the object sought to be recovered, and that the
defendant, who is in actual or legal possession thereof, wrongfully detains the same”
(Superlines Transportation Company, Inc v. Philippine National Construction Company, 548
Phil. 354,364).

From petitioner’s own account, he constituted and appointed Ong as his agent to sell the
vehicle, surrendering to the latter the vehicle, all documents of title pertaining thereto, and
a deed of sale signed in blank. Acting for and in petitioner’s behalf by virtue of the implied
or oral agency, Ong was thus able to sell the vehicle to Chua, petitioner thus ceased to be
the owner thereof. Quite the contrary, respondent who obtained the vehicle from Chua and
registered the transfer with the Land Transportation Office, is the rightful owner thereof,
and as such, he is entitled to its possession.

Hence, the Supreme Court denied the petition, affirming the decision of the Court of
Appeals.

16. Heirs of Demetrio Melchor vs. Melchor 415 SCRA 726

FACTS:

Petitioners, who are the heirs of DEMETRIO MELCHOR, claim to be the owners, by way of
succession, of the subject property allegedly in possession of respondent JULIO
MELCHOR. The subject property is a portion of the twenty (20) hectares of land registered in
the name of PEDRO MELCHOR, evidenced by Original Certificate of Title No.I-6020 of the
Registry of Deeds for Isabela. The said property was purchased by the late DEMETRIO
MELCHOR from PEDRO MELCHOR, the deceased father of herein respondent JULIO
MELCHOR. During the lifetime of the late DEMETRIO MELCHOR, a request for the approval of
the Deed of Sale dated February 14, 1947 between DEMETRIO MELCHOR and PEDRO
MELCHOR was made to the Secretary of Agriculture and Natural Resources on September 4,
1953, which was subsequently approved. Since February 14, 1947 up to the present,
petitioners further allege that respondent has been occupying the subject property and has
been harvesting crops thereon and using it for grassing cows and carabaos.

A demand letter dated August 21, 1999 was allegedly sent by the petitioners to the
respondent, demanding him to vacate and surrender the said property, but the latter
refused. The disagreement reached the barangay authorities, which case was not amicably
settled, resulting in the issuance of a certification to file action. Petitioners filed against
respondent a complaint for ejectment before the MTC. The defendant (now respondent)
in Civil Case No. 2325 principally raised the matter of ownership by alleging
affirmative/special defenses, among others, that the parcel of land in possession of the
defendant is registered in the name of ANTONIA QUITERAS, the deceased mother of the
defendant. MTC Judge BERNABE B. MENDOZA, was rendered in favor of the respondent. Tthe
Regional Trial Court, Branch 20 of Cauayan, Isabela affirmed the MTC decision. Sustaining
the Regional Trial Court (RTC), the CA ruled that petitioners had failed to make a case for
unlawful detainer

ISSUE:

WON The Court of Appeals committed a grave error when it ruled that the Second Amended
Complaint does not allege a sufficient cause of action for x x x unlawful detainer. [8]

HELD:

We do not agree. Even if petitioners may be correct in saying that prior physical
possession by the plaintiff need not be alleged in an action for unlawful detainer, [10] the
absence of such possession does not ipso facto make their Complaint sufficient to confer
jurisdiction on the MTC.
In ejectment cases, the jurisdiction of the court is determined by the allegations of the
complaint.[11] The test for determining the sufficiency of those allegations is whether,
admitting the facts alleged, the court can render a valid judgment in accordance with the
prayer of the plaintiff.[12]
It is clear from the foregoing that the allegations in the Complaint failed to constitute a
case for either forcible entry or unlawful detainer. These actions, which deal with physical
or de facto possession,[19] may be distinguished as follows:

(1) In an action for forcible entry, the plaintiff must allege and prove that he was in prior
physical possession of the premises until deprived thereof, while in illegal detainer, the
plaintiff need not have been in prior physical possession; and (2) in forcible entry, the
possession by the defendant is unlawful ab initio because he acquires possession by force,
intimidation, threat, strategy, or stealth, while in unlawful detainer, possession is originally
lawful but becomes illegal by reason of the termination of his right of possession under his
contract with the plaintiff. In pleadings filed in courts of special jurisdiction, the special facts
giving the court jurisdiction must be specially alleged and set out. Otherwise, the complaint
is demurrable.[20]

As correctly held by the appellate court, [f]orcible entry must be ruled out as there was
no allegation that the petitioners were denied possession of the subject property through any
of the means stated in Section 1, Rule 70 [of the Rules of Court]. [21]
Neither was unlawful detainer satisfactorily alleged. In determining the sufficiency of a
complaint therefor, it is not necessary to employ the terminology of the law. [22] Not averred
in this case, however, were certain essential facts such as how entry was effected, or how
and when dispossession started.[23]

Neither did the Complaint claim as a fact any overt act on the part of petitioners showing that
they had permitted or tolerated respondents occupancy of the subject property. [24] It is a
settled rule that in order to justify an action for unlawful detainer, the owners permission or
tolerance must be present at the beginning of the possession. [25] Furthermore, the complaint
must aver the facts showing that the inferior court has jurisdiction to try the case

Since the Complaint did not satisfy the jurisdictional requirements of a valid cause for
forcible entry or unlawful detainer, the appellate court was correct in holding that the MTC
had no jurisdiction to hear the case.
Under the proper circumstances, what may be filed is a case either for accion publiciana,
which is a plenary action intended to recover the better right to possess; or an accion
reivindicatoria, a suit to recover ownership of real property

07 Tolentino v. Laurel
GR. No. 181368 (2012)
J. Peralta / Tita K

Subject Matter: Rule 18: Pre-trial; Secs. 4 and 5

Case Summary: Respondents are the registered owners of a parcel of land. Petitioners
have occupied a portion of the said property and developed it into fishponds. Petitioners
continued to develop the area and refused to vacate the same. Respondents then filed an
action for reconveyance of property against petitioners. Petitioners were initially declared in
default by the RTC. The RTC however, set aside the Order of default and reset the pre-trial
conference. Despite several resetting of the pre-trial conference, petitioners still failed to
appear. Hence, RTC allowed respondents to present evidence ex parte. RTC ruled in favor of
respondents, ordering them to vacate the said property and pay rentals. CA affirmed RTC
decision.

Petitioners argued before the SC that they were denied of due process as they were not
allowed to present their evidence before the trial court. Nonetheless, the SC ruled that they
were not denied of due process.

The trial court gave petitioners every chance to air their side and even reconsidered its first
order declaring petitioners in default. Notwithstanding, petitioners and their counsel failed to
take advantage of such opportunity and disregarded the legal processes, by continuously
failing to appear during the pre-trial of the case without any valid cause. Clearly, when the
trial court allowed the respondents to present evidence ex parte, it did so in accordance
with Rule 18 of the 1997 Rules of Civil Procedure and with due regard to the constitutional
guarantee of due process. Petitioners’ repeated failure to appear at the pre-trial amounted
to a failure to comply with the Rules and their non-presentation of evidence before the trial
court was essentially due to their fault.

Doctrine/s:
If the party who failed to appear at the pre- trial is the plaintiff, then his case shall be
dismissed. If it is the defendant who fails to appear, then the plaintiff is allowed to present
his evidence ex parte and the court shall render judgment on the basis thereof.

Pre-trial seeks to achieve the following: (a) The possibility of an amicable settlement or of a
submission to alternative modes of dispute resolution; (b) The simplification of the issues;
(c) The necessity or desirability of amendments to the pleadings; (d) The possibility of
obtaining stipulations or 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 issues to a commissioner; (g) The propriety of rendering judgment on the pleadings, or
summary judgment, or of dismissing the action should a valid ground therefor be found to
exist; (h) The advisability or necessity of suspending the proceedings; and (i) Such other
matters as may aid in the prompt disposition of the action.

Action Before SC: “This is a petition for review under Rule 45 of the Rules of Court”

Petitioner GEORGE S. TOLENTINO, MONICA S. TOLENTINO,
GUSTAVO S.

TOLENTINO, JR.,
MA. MARJORIE S.
TOLENTINO, MARILYN S. TOLENTINO, MICHAEL GLEN S.
TOLENTINO, MYLENE S. TOLENTINO, MILAGROS M. GUEVARRA, MA.
VICTORIA T. RAMIREZ, LORENZA
T. ANDES, MICHAEL T. MEDRANO and
JACINTO T. MEDRANO

Respondent PACIFICO S. LAUREL, HEIRS OF ILUMINADA LAUREL- ASCALON, CONSUELO

T. LAUREL, BIENVENIDO LAUREL, HEIRS OF ARCHIMEDES LAUREL,
TEODORO LAUREL, FE LAUREL-LIMJUCO and CLARO LAUREL
Parties:

Antecedent Facts:
1. Respondents are the registered owners of a parcel of land with an area of
1,056,275 square meters.
2. For several years, petitioners have been in actual possession of the western
portion of the said property with a total area of 620,000 square meters which
they tried to develop into fishponds.
3. Respondents asked the petitioners to vacate the occupied property. However,
petitioner Gustavo asked for time to verify respondents’ claim of ownership.
4. Respondents waited for almost a year for the outcome of the intended verification,
but they waited in vain until Gustavo died.
5. Petitioners continued to develop the area they were occupying into fishponds,
thereby manifesting their unwillingness to vacate the premises and restore
the possession thereof in favor of respondents.
RTC
6. Respondents filed an action to recover the property and demand payment of
unearned income.
7. Petitioners were declared in default, for failure to appear at the pre-trial conference.
8. However, the trial court set aside the default order and reset the pre-trial
conference.
9. Despite several resetting of the pre-trial conference of which petitioners were
notified, petitioners failed to appear.
10. Hence, on March 21, 2000, the trial court issued an Order allowing
respondents to present their evidence ex parte, instead of declaring petitioners
in default.
11. RTC ruled in favor of respondents ordering the petitioners to vacate said property
and reasonable rental.
CA
 12.CA affirmed the RTC decision.
13. Petitioner’s MR was denied.
Issues:
1. WON petitioners were denied their day in court. (NO)
Argument:
Petitioner argues that that they were denied their day in court, because they were not
allowed to present their evidence before the trial court which resulted in the denial of their
right to due process.

Ratio:
NO – petitioners were not denied of due process.
 Failure of a party to appear at the pre-trial has adverse consequences.
 If the absent party is the plaintiff, then his case shall be dismissed.
 If it is the defendant who fails to appear, then the plaintiff is allowed to
present his evidence ex parte and the court shall render judgment on the
basis thereof. Thus, the plaintiff is given the privilege to present his evidence
without objection from the defendant, the likelihood being that the court will decide
in favor of the plaintiff, the defendant having forfeited the opportunity to rebut or
present its own evidence.
o In this case, the trial court gave petitioners every chance to air their
side and even reconsidered its first order declaring petitioners in default.
o Notwithstanding, petitioners and their counsel failed to take advantage
of such opportunity and disregarded the legal processes, by continuously
failing to appear during the pre-trial of the case without any valid cause.
o Clearly, when the trial court allowed the respondents to present evidence ex
parte due to the continued failure of the petitioners to attend the pre-trial
conference, it did so in accordance with Rule 18 of the 1997 Rules of Civil
Procedure and with due regard to the constitutional guarantee of due process.
 In The Philippine American Life & General Insurance Company v. Enario, the Court
held that pre-trial cannot be taken for granted. It is not a mere technicality in court
proceedings for it serves a vital objective: the simplification, abbreviation and
expedition of the trial, if not indeed its dispensation.
 Pre-trial seeks to achieve the following:
(a) The possibility of an amicable settlement or of a submission to alternative modes
of dispute resolution;
(b) The simplification of the issues;
(c) The necessity or desirability of amendments to the pleadings;
(d) The possibility of obtaining stipulations or 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 issues to a commissioner;
(g) The propriety of rendering judgment on the pleadings, or summary judgment, or
of dismissing the action should a valid ground therefor be found to exist;
(h) The advisability or necessity of suspending the proceedings; and
(i) Such other matters as may aid in the prompt disposition of the action.
o Petitioners’ repeated failure to appear at the pre-trial amounted to a
failure to comply with the Rules and their non-presentation of
evidence before the trial court was essentially due to their fault.

Dispositive: Wherefore, the petition is DENIED. The Decision and Resolution of the Court of
Appeals, dated October 18, 2007 and January 22, 2008, respectively, in CA-G.R. CV No.
78676, are AFFIRMED with MODIFICATION that the award of attorney’s fees and litigation
expenses is DELETED.

GABUTAN VS. NACALABAN G.R. NOS. 185857-58/G.R. NOS. 194314-15. JUNE 29, 2016

On January 25, 1957, Godofredo Nacalaban (Godofredo) purchased an 800-square meter

parcel of prime land (property) in Poblacion, Cagayan de Oro City. Pursuant to the sale,
Transfer Certificate of Title (TCT) No. T-22597covering the property was issued in the name
of Godofredo. He thereafter built a house on it.

Godofredo died on January 7, 1974. He was survived by his wife, Baldomera, and their
children, Dante, Helen, and Susan. On March 19, 1979, Baldomera issued a Certification in
favor of her mother, Melecia. It provided, in effect, that Baldomera was allowing her mother
to build and occupy a house on the portion of the property. Accordingly, the house was
declared for taxation purposes. The tax declaration presented in evidence showed that
Melecia owned the building on the land owned by Godofredo.

Baldomera died on September 11, 1994. On July 3, 1996, her children executed an
Extrajudicial Settlement with Sale where they adjudicated unto themselves the property and
sold it to Cagayan Capital College. On August 22, 1996, TCT No. T-2259 was cancelled and
TCT No. T-111846 covering the property was issued in the name of the College.

Melecia died and was survived by her children who continued living in the house, Gabutan
was one of these children. College demanded that said heirs vacate the premises.

On July 7, 1997, Gabutan, et al. filed a Complaint for Reconveyance of Real Property,
Declaration of Nullity of Contracts, Partition and Damages with Writ of Preliminary
Attachment and Injunction against Nacalaban, et al. and the College. They alleged that: (1)
Melecia bought the property using her own money but Godofredo had the Deed of Absolute
Sale executed in his name instead of his mother-in-law;(2) Godofredo and Baldomera were
only trustees of the property in favor of the real owner and beneficiary, Melecia;(3) they
only knew about the Extrajudicial Settlement with Sale upon verification with the Registry of
Deeds;and (4) the College was a buyer in bad faith, being aware they were co-owners of
the property.

W/N the action for reconveyance is proper

W/N the college is a buyer in good faith

HELD:

Gabutan, et al., through the testimonies of Felisia, Crisanta, and Trifonia, established that
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. On
one occasion in Melecia's house, and when the entire family was present, Melecia gave
Godofredo the money to purchase the property. Melecia entrusted the money to Godofredo
because he was in Cagayan de Oro, and per Melecia's instruction, the deed of sale covering
the property was placed in his name. It was allegedly her practice to buy properties and
place them in her children's name, but it was understood that she and her children co-own
the properties.

Melecia built a residential building on the property, where her daughter Crisanta and some
of her grandchildren resided. Godofredo also thereafter built a house on the property.
Twice, he also mortgaged the property to secure loans. Melecia allowed him to do so
because she trusted him. After Godofredo's death, and when Baldomera fell ill, there were
family discussions to transfer the title in Melecia's name so Melecia's children can divide it
together with the rest of Melecia's properties. The plans, however, always fell through.

Article 1448 of the Civil Code provides in part that there is an implied trust when property is
sold, and the legal estate is granted to one party but the price is paid by another for the
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
money resulting trust, occurs when there is (1) an actual payment of money, property or
services, or an equivalent, constituting valuable consideration; (2) and such consideration
must be furnished by the alleged beneficiary of a resulting trust. These two elements are
present here.

Having established the creation of an implied resulting trust, the action for reconveyance
filed by Gabutan, et al., the heirs of Melecia in whose benefit the trust was created, is
proper. An action for reconveyance is a legal and equitable remedy granted to the rightful
landowner, whose land was wrongfully or erroneously registered in the name of another, to
compel the registered owner to transfer or reconvey the land to him.

College is not a buyer in good faith. To prove good faith, a buyer of registered and titled
land need only show that he relied on the face of the title to the property. He need not
prove that he made further inquiry for he is 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
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
aware of any claim or interest of some other person in the property, or of any
defect or restriction in the title of the seller or in his capacity to convey title to the
property.

Thus, the College, which has the burden to prove the status of being a purchaser in good
faith, is required to prove the concurrence of the above conditions. This onus
probandi cannot be discharged by mere invocation of the legal presumption of good
faith.We find that the College failed to discharge this burden. They knew that the heirs of
Melecia lived on the property yet did not conduct a proper inquiry into it. The "honesty of
intention" which constitutes good faith implies a freedom from knowledge of
circumstances which ought to put a person on inquiry. If the land purchased is in the
possession of a person other than the vendor, the purchaser must be wary and must
investigate the rights of the actual possessor. Without such inquiry, the purchaser cannot be
said to be in good faith and cannot have any right over the property.