G.R. No.

L-630            November 15, 1947

ALEXANDER A. KRIVENKO, petitioner-appellant,
vs.
THE REGISTER OF DEEDS, CITY OF MANILA, respondent and appellee.

Alenxander A. Kriventor alien, bought a residential lot from the Magdalena Estate, Inc., in December
of 1941, the registration of which was interrupted by the war. In May, 1945, he sought to accomplish
said registration but was denied by the register of deeds of Manila on the ground that, being an
alien, he cannot acquire land in this jurisdiction. Krivenko then brought the case to the fourth branch
of the Court of First Instance of Manila by means of a consulta, and that court rendered judgment
sustaining the refusal of the register of deeds, from which Krivenko appealed to this Court.

There is no dispute as to these facts. The real point in issue is whether or not an alien under our
Constitution may acquire residential land.

Ruling

Congress approved Republic Act No. 133 which allows mortgage of "private real property" of any
kind in favor of aliens but with a qualification consisting of expressly prohibiting aliens to bid or take
part in any sale of such real property as a consequence of the mortgage. This prohibition makes no
distinction between private lands that are strictly agricultural and private lands that are residental or
commercial. The prohibition embraces the sale of private lands of any kind in favor of aliens, which
is again a clear implementation and a legislative interpretation of the constitutional prohibition. Had
the Congress been of opinion that private residential lands may be sold to aliens under the
Constitution, no legislative measure would have been found necessary to authorize mortgage which
would have been deemed also permissible under the Constitution. But clearly it was the opinion of
the Congress that such sale is forbidden by the Constitution and it was such opinion that prompted
the legislative measure intended to clarify that mortgage is not within the constitutional prohibition.

It is well to note at this juncture that in the present case we have no choice. We are construing the
Constitution as it is and not as we may desire it to be. Perhaps the effect of our construction is to
preclude aliens, admitted freely into the Philippines from owning sites where they may build their
homes. But if this is the solemn mandate of the Constitution, we will not attempt to compromise it
even in the name of amity or equity. We are satisfied, however, that aliens are not completely
excluded by the Constitution from the use of lands for residential purposes. Since their residence in
the Philippines is temporary, they may be granted temporary rights such as a lease contract which is
not forbidden by the Constitution. Should they desire to remain here forever and share our fortunes
and misfortunes, Filipino citizenship is not impossible to acquire.
G.R. No. L-31606 March 28, 1983

DONATO REYES YAP and MELITONA MARAVILLAS, petitioners,

vs.
HON. EZEKIEL S. GRAGEDA, as Judge of the Court of First Instance of Albay and JOSE A.
RICO, respondents.

Maximino Rico, for and in his own behalf and that of the minors Maria Rico, Filomeno Rico, Prisco
Rico, and Lourdes' Rico, executed a Deed of Absolute Sale (Annex 'A' to the complaint) over Lot 339
and a portion of Lot 327 in favor of the petitioner Donato Reyes Yap who was then a Chinese
national. Respondent Jose A. Rico is the eldest son of Maximino Rico, one of the vendors in Annex
'A'.

Subsequently, the petitioner as vendee caused the registration of the instrument of sale and the
cancellation of Original Certificates of Title Nos. 29332 and 29410 and the consequent issuance in
his favor of Transfer Certificate of Title No. T-2433 covering the two lots subject matter of the
Contract of Sale.

The respondent court considered Section 5, Article XIII of the 1935 Constitution that "no private
agricultural land shall be transferred or assigned except to individuals, corporations, or associations
qualified to acquire or hold lands of the public domain in the Philippines" to be an absolute and
unqualified prohibition and, therefore, ruled that a conveyance contrary to it would not be validated
nor its void nature altered by the subsequent naturalization of the vendee and ordered its
reconveyance to the vendors.

But the factual set-up has changed. The litigated property is now in the hands of a naturalized
Filipino. It is no longer owned by a disqualified vendee. Respondent, as a naturalized citizen, was
constitutionally qualified to own the subject property. There would be no more public policy to be
served in allowing petitioner Epifania to recover the land as it is already in the hands of a qualified
person. Petition Granted.
G.R. No. 159310               February 24, 2009

CAMILO F. BORROMEO, Petitioner,
vs.
ANTONIETTA O. DESCALLAR, Respondent.

Wilhelm Jambrich, an Austrian, met respondent Antonietta Opalla-Descallar. They fell in love and
live together. They bought a house and lot and an Absolute Deed of Sale was issued in their names.
However, when the Deed of Absolute Sale was presented for registration, it was refused on the
ground that Jambrich was an alien and could not acquire alienable lands of the public domain.
Consequently, his name was erased but his signature remained and the property was issued on the
name of the Respondent alone. However their relationship did not last long and they found new love.

Jambrich met the petitioner who was engaged in business. Jambrich indebted the petitioner for a sum
of money and to pay his debt, he sold some of his properties to the petitioner and a Deed of Absolute
Sale/Assignment was issued in his favor. However, when the Petitioner sought to register the deed of
assignment it found out that said land was registered in the name of Respondent. Petitioner filed a
complaint against respondent for recovery of real property.
RTC – ruled in favor of petitioner, CA – reversed the decision
Ruling:
The evidence clearly shows that as between respondent and Jambrich, it was Jambrich who possesses
the financial capacity to acquire the properties in dispute. At the time of the acquisition of the
properties, Jamrich was the source of funds used to purchase the three parcels of land, and to
construct the house. Jambrich was the owner of the properties in question, but his name was deleted
in the Deed of Absolute Sale because of legal constraints. Nevertheless, his signature remained in the
deed of sale where he signed as a buyer. Thus, Jambrich has all authority to transfer all his rights,
interest and participation over the subject properties to petitioner by virtue of Deed of Assignment. 

It is settled that registration is not a mode of acquiring ownership.21 It is only a means of confirming
the fact of its existence with notice to the world at large.22 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. 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.

The rationale behind the Court’s ruling in United Church Board for World Ministries, as reiterated in
subsequent cases,32 is this – since the ban on aliens is intended to preserve the nation’s land for
future generations of Filipinos, that aim is achieved by making lawful the acquisition of real estate by
aliens who became Filipino citizens by naturalization or those transfers made by aliens to Filipino
citizens. As the property in dispute is already in the hands of a qualified person, a Filipino citizen,
there would be no more public policy to be protected. The objective of the constitutional provision to
keep our lands in Filipino hands has been achieved.

IN VIEW WHEREOF, the petition is GRANTED.

G.R. No. 108998 August 24, 1994

REPUBLIC OF THE PHILIPPINES, petitioner,
vs.
THE COURT OF APPEALS AND SPOUSES MARIO B. LAPIÑA AND FLOR DE
VEGA, respondents.

On June 17, 1978, respondent spouses bought Lots 347 and 348, Cad. s38-D, as their residence
with a total area of 91.77 sq. m. situated in San Pablo City, from one Cristeta Dazo Belen (Rollo, p.
41). At the time of the purchase, respondent spouses where then natural-born Filipino citizens. On
February 5, 1987, the spouses filed an application for registration of title of the two (2) parcels of
land before the Regional Trial Court of San Pablo City, Branch XXXI. This time, however, they were
no longer Filipino citizens and have opted to embrace Canadian citizenship through naturalization.

Petitioner submits that private respondents have not acquired proprietary rights over the subject
properties before they acquired Canadian citizenship through naturalization to justify the registration
thereof in their favor. It maintains that even privately owned unregistered lands are presumed to be
public lands under the principle that lands of whatever classification belong to the State under the
Regalian doctrine.

RTC – ruled in favor of Respondents, CA – Affrimed, in the present case, it is undisputed that both
applicants were still Filipino citizens when they bought the land in controversy from its former owner.
For this reason, the prohibition against the acquisition of private lands by aliens could not apply.

In the main, petitioner seeks to defeat respondents' application for registration of title on the ground
of foreign nationality.

Ruling

Section 8, Article XII of the 1987 Constitution above quoted is similar to Section 15, Article XIV of the
then 1973 Constitution which reads:

Sec. 8. Notwithstanding the provisions of Section 7 of this Article, a natural-born citizen of the
Philippines who has lost his Philippine citizenship may be a transferee of private lands, subject to
limitations provided by law.

Sec. 15. Notwithstanding the provisions of Section 14 of this Article, a natural-born citizen of the
Philippines who has lost his citizenship may be a transferee of private land, for use by him as his
residence, as the Batasang Pambansa may provide.

Pursuant thereto, Batas Pambansa Blg. 185 was passed into law, the relevant provision of which
provides:

Sec. 2. Any natural-born citizen of the Philippines who has lost his Philippine
citizenship and who has the legal capacity to enter into a contract under Philippine
laws may be a transferee of a private land

It is undisputed that private respondents, as vendees of a private land, were natural-born citizens of
the Philippines. For the purpose of transfer and/or acquisition of a parcel of residential land, it is not
significant whether private respondents are no longer Filipino citizens at the time they purchased or
registered the parcels of land in question. What is important is that private respondents were
formerly natural-born citizens of the Philippines, and as transferees of a private land, they could
apply for registration in accordance with the mandate of Section 8, Article XII of the Constitution.

WHEREFORE, the petition is DISMISSED and the decision appealed from is hereby AFFIRMED.
G.R. No. L-27952 February 15, 1982

TESTATE ESTATE OF JOSE EUGENIO RAMIREZ, MARIA LUISA PALACIOS,

Administratrix, petitioner-appellee,
vs.
MARCELLE D. VDA. DE RAMIREZ, ET AL., oppositors, JORGE and ROBERTO
RAMIREZ, legatees, oppositors- appellants.

Jose Eugenio Ramirez, a Filipino national, died in Spain on December 11, 1964, with only his widow
as compulsory heir. His will was admitted to probate by the Court of First Instance of Manila, Branch
X, on July 27, 1965. Maria Luisa Palacios was appointed administratrix of the estate. The task is not
trouble-free because the widow Marcelle is a French who lives in Paris, while the companion Wanda
is an Austrian who lives in Spain. Moreover, the testator provided for substitutions.

Jorge and Roberto opposed the project of partition on the ground that: (c) that the grant of a usufruct
over real property in the Philippines in favor of Wanda Wrobleski, who is an alien, violates Section 5,
Article III of the Philippine Constitution;

Ruling: The usufruct of Wanda is valid (being not an ownership but only a right)

The usufruct of Wanda.

The appellants claim that the usufruct over real properties of the estate in favor of Wanda is void
because it violates the constitutional prohibition against the acquisition of lands by aliens.

The 1935 Constitution which is controlling provides as follows:

SEC. 5. Save in cases of hereditary succession, no private agricultural land shall be

transferred or assigned except to individuals, corporations, or associations qualified
to acquire or hold lands of the public domain in the Philippines. (Art. XIII.)

The court a quo upheld the validity of the usufruct given to Wanda on the ground that the
Constitution covers not only succession by operation of law but also testamentary succession. We
are of the opinion that the Constitutional provision which enables aliens to acquire private lands does
not extend to testamentary succession for otherwise the prohibition will be for naught and
meaningless. Any alien would be able to circumvent the prohibition by paying money to a Philippine
landowner in exchange for a devise of a piece of land.

This opinion notwithstanding, We uphold the usufruct in favor of Wanda because a usufruct, albeit a
real right, does not vest title to the land in the usufructuary and it is the vesting of title to land in favor
of aliens which is proscribed by the Constitution.

IN VIEW OF THE FOREGOING, the estate of Jose Eugenio Ramirez is hereby ordered distributed
as follows:

One-half (1/2) thereof to his widow as her legitime;

One-half (1/2) thereof which is the free portion to Roberto and Jorge Ramirez in naked ownership
and the usufruct to Wanda de Wrobleski with a simple substitution in favor of Juan Pablo Jankowski
and Horace V. Ramirez.

The distribution herein ordered supersedes that of the court a quo. No special pronouncement as to
costs.
G.R. No. 155051             May 29, 2007

RURAL BANK OF ANDA, INC., Petitioner,

vs.
ROMAN CATHOLIC ARCHBISHOP OF LINGAYEN- DAGUPAN, Respondent.

Sangguniang Bayan of Binmaley, Pangasinan, passed and approved Resolution Nos. 1045 and
105.6 Resolution No. 104 converted Lot 736 from an institutional lot to a commercial lot. Resolution
No. 105 authorized the municipal mayor to enter into a contract of lease for 25 years with the Rural
Bank of Anda

On 24 March 1998, respondent requested Mayor Domalanta to remove the sawali fence and restore
the concrete fence. On 20 May 1998, Mayor Domalanta informed respondent that the construction of
the building of the Rural Bank of Anda would resume but that he was willing to discuss with
respondent to resolve the problem concerning Lot 736. On 1 June 1998, respondent filed a
complaint for Abatement of Illegal Constructions, Injunction and Damages with Writ of Preliminary
Injunction in the Regional Trial Court of Lingayen, Pangasinan.

The trial court found that Lot 736 is not covered by any Torrens title either in the name of respondent
or in the name of the Municipality of Binmaley. The trial court held that Lot 736 is public in nature.
Since Lot 736 is property of public dominion, it is outside the commerce of man. Thus, the
Sangguniang Bayan of Binmaley, Pangasinan exceeded its authority when it adopted Resolution
Nos. 104 and 105 converting Lot 736 from an institutional lot to a commercial lot and authorizing the
municipal mayor to enter into a contract of lease for 25 years with the Rural Bank of Anda over a 252
square meter portion of Lot 736. The Court of Appeals agreed with the trial court that Lot 736 is
property of public dominion and is used by the public as a pathway. Respondent and the Municipality
of Binmaley are mere claimants with no sufficient evidence to prove their ownership of Lot 736. 

Ruling: The petition has no merit.

Both respondent and the Municipality of Binmaley admit that they do not have title over Lot 736. The
records show that Lot 736 is used as a pathway going to the school, the seminary, or the church,
which are all located on lots adjoined to Lot 736.14 Lot 736 was also used for parking and
playground.15 In other words, Lot 736 was used by the public in general.

it is well settled "that no public land can be acquired by private persons without any grant, express or
implied, from the government." It is indispensable then that there be a showing of a title from the
state or any other mode of acquisition recognized by law.

Municipal corporations cannot appropriate to themselves public or government lands without prior
grant from the government.18 Since Lot 736 is owned by the state, the Sangguniang Bayan of
Binmaley exceeded its authority in passing Resolution Nos. 104 and 105. Thus, Resolution Nos. 104
and 105 are void and consequently, the contract of lease between the Municipality of Binmaley and
the Rural Bank of Anda over a portion of Lot 736 is also void.

WHEREFORE, we DENY the petition. We AFFIRM the Decision dated 15 October 2001 and the
Resolution dated 23 August 2002 of the Court of Appeals.
Section 3. Definition and Classification of Banks. -

3.1. "Banks" shall refer to entities engaged in the lending of funds obtained in the form of deposits.
(2a)

3.2. Banks shall be classified into:

(a) Universal banks;

(b) Commercial banks;

(c) Thrift banks, composed of: (i) Savings and mortgage banks, (ii) Stock savings and loan
associations, and (iii) Private development banks, as defined in the Republic Act No. 7906
(hereafter the "Thrift Banks Act");

(d) Rural banks, as defined in Republic Act No. 73S3 (hereafter the "Rural Banks Act");

(e) Cooperative banks, as defined in Republic Act No 6938 (hereafter the "Cooperative
Code");

(f) Islamic banks as defined in Republic Act No. 6848, otherwise known as the "Charter of Al
Amanah Islamic Investment Bank of the Philippines"; and

(g) Other classifications of banks as determined by the Monetary Board of the Bangko
Sentral ng Pilipinas. (6-Aa)

SECTION 51. Ceiling on Investments in Certain Assets. – Any bank may acquire real estate as shall be
necessary for its own use in the conduct of its business: Provided, however, That the total investment in such
real estate and improvements thereof including bank equipment, shall not exceed fifty percent (50%) of
combined capital accounts: Provided, further, That the equity investment of a bank in another corporation
engaged primarily in real estate shall be considered as part of the bank’s total investment in real estate, unless
otherwise provided by the Monetary Board. (25a)

SEC. 52. Acquisition of Real Estate by Way of Satisfaction of Claims. – Notwithstanding the limitations of
the preceding Section, a bank may acquire, hold or convey real property under the following circumstances:

52.1. Such as shall be mortgaged to it in good faith by way of security for debts;

52.2. Such as shall be conveyed to it in satisfaction of debts previously contracted in the course of its dealings,
or

52.3. Such as it shall purchase at sales under judgments, decrees, mortgages, or trust deeds held by it and such
as it shall purchase to secure debts due it.

Any real property acquired or held under the circumstances enumerated in the above paragraph shall be
disposed of by the bank within a period of five (5) years or as may be prescribed by the Monetary Board:
Provided, however, That the bank may, after said period, continue to hold the property for its own use, subject
to the limitations of the preceding Section. (25a)
G.R. No. 171545               December 19, 2007

EQUITABLE PCI BANK,* AIMEE YU and BEJAN LIONEL APAS, Petitioners,

vs.
NG SHEUNG NGOR** doing business under the name and style "KEN MARKETING," KEN
APPLIANCE DIVISION, INC. and BENJAMIN E. GO, Respondents.

On October 7, 2001, respondents Ng Sheung Ngor,4 Ken Appliance Division, Inc. and Benjamin E.
Go filed an action for annulment and/or reformation of documents and contracts5 against petitioner
Equitable PCI Bank (Equitable) and its employees, Aimee Yu and Bejan Lionel Apas, in the Regional
Trial Court (RTC), Branch 16 of Cebu City.6 They claimed that Equitable induced them to avail of its
peso and dollar credit facilities by offering low interest rates7 so they accepted Equitable's proposal
and signed the bank's pre-printed promissory notes on various dates beginning 1996. They,
however, were unaware that the documents contained identical escalation clauses granting
Equitable authority to increase interest rates without their consent.8

Equitable, in its answer, asserted that respondents knowingly accepted all the terms and conditions
contained in the promissory notes.9 In fact, they continuously availed of and benefited from
Equitable's credit facilities for five years.10

After trial, the RTC upheld the validity of the promissory notes. Nevertheless, it took judicial notice of
the steep depreciation of the peso during the intervening period 13 and declared the existence of
extraordinary deflation. Lastly, because the business reputation of respondents was (allegedly)
severely damaged when Equitable froze their accounts, 16 the trial court awarded moral and
exemplary damages to them.17

A writ of execution was thereafter issued29 and three real properties of Equitable were levied upon.30

n March 26, 2004, Equitable filed a petition for relief in the RTC from the March 1, 2004 order.31 It,
however, withdrew that petition on March 30, 200432 and instead filed a petition for certiorari with an
application for an injunction in the CA to enjoin the implementation and execution of the March 24,
2004 omnibus order.33

On June 16, 2004, the CA granted Equitable's application for injunction. A writ of preliminary
injunction was correspondingly issued.3

Notwithstanding the writ of injunction, the properties of Equitable previously levied upon were sold in
a public auction on July 1, 2004. Respondents were the highest bidders and certificates of sale were
issued to them.35 On October 28, 2005, the CA dismissed the petition for certiorari. 37 It found
Equitable guilty of forum shopping because the bank filed its petition for certiorari in the CA several
hours before withdrawing its petition for relief in the RTC.

Ruling: This petition is meritorious.

Equitable Was Not Guilty Of Forum shopping

Equitable substantially complied with the rule on non-forum shopping when it moved to withdraw its
petition for relief in the RTC on the same day (in fact just four hours and forty minutes after) it filed
the petition for certiorari in the CA. Even if Equitable failed to disclose that it had a pending petition
for relief in the RTC, it rectified what was doubtlessly a careless oversight by withdrawing the petition
for relief just a few hours after it filed its petition for certiorari in the CA ― a clear indication that it
had no intention of maintaining the two actions at the same time.

The Trial Court Committed Grave Abuse of Discretion In Issuing Its March 1, 2004 and March
24, 2004 Orders
The March 1, 2004 and March 24, 2004 orders of the RTC were obviously intended to prevent
Equitable, et al. from appealing the February 5, 2004 decision. Not only that. The execution of the
decision was undertaken with indecent haste, effectively obviating or defeating Equitable's right to
avail of possible legal remedies. No matter how we look at it, the RTC committed grave abuse of
discretion in rendering those orders.

Equitable Raised Pure Questions of Law in Its Petition For Review

Equitable does not assail the factual findings of the trial court. Its arguments essentially focus on the
nullity of the RTC’s February 5, 2004 decision. Equitable points out that that decision was patently
erroneous, specially the exorbitant award of damages, as it was inconsistent with existing law
and jurisprudence.57

The Promissory Notes Were Valid

As the trial court noted, if the terms and conditions offered by Equitable had been truly prejudicial to
respondents, they would have walked out and negotiated with another bank at the first available
instance. But they did not. Instead, they continuously availed of Equitable's credit facilities for five
long years.

There Was No Extraordinary Deflation

Despite the devaluation of the peso, the BSP never declared a situation of extraordinary inflation.
Moreover, although the obligation in this instance arose out of a contract, the parties did not agree to
recognize the effects of extraordinary inflation (or deflation). 77 The RTC never mentioned that there
was a such stipulation either in the promissory note or loan agreement. Therefore, respondents
should pay their dollar-denominated loans at the exchange rate fixed by the BSP on the date of
maturity.78

The Award Of Moral And Exemplary Damages Lacked Basis

Respondents indeed defaulted on their obligation. For this reason, Equitable had the option to
exercise its legal right to set-off or compensation. However, the RTC mistakenly (or, as it now
appears, deliberately) concluded that Equitable acted "fraudulently or in bad faith or in wanton
disregard" of its contractual obligations despite the absence of proof. The undeniable fact was that,
whatever damage respondents sustained was purely the consequence of their failure to pay
their loans. There was therefore absolutely no basis for the award of moral damages to them

ACCORDINGLY, the petition is hereby GRANTED.

he March 24, 2004 omnibus order of the Regional Trial Court, Branch 16, Cebu City in Civil Case
No. CEB-26983 is hereby ANNULLED for being rendered with grave abuse of discretion amounting
to lack or excess of jurisdiction. All proceedings undertaken pursuant thereto are likewise declared
null and void.