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December 2013 Philippine Supreme Court Decisions on Civil Law

Civil Code
Contracts; concept of contracts. A contract is what the law defines it to be, taking into
consideration its essential elements, and not what the contracting parties call it. The real
nature of a contract may be determined from the express terms of the written agreement
and from the contemporaneous and subsequent acts of the contracting parties. However,
in the construction or interpretation of an instrument, the intention of the parties is
primordial and is to be pursued. The denomination or title given by the parties in their
contract is not conclusive of the nature of its contents. ACE Foods, Inc. v. Micro Pacific
Technologies Co., Ltd., G.R. No. 200602, December 11, 2013.
Contracts; contract of loan; interest stipulated; reduced for being iniquitous and
unconscionable. Parties to a loan contract have wide latitude to stipulate on any interest
rate in view of the Central Bank Circular No. 905 s. 1982 which suspended the Usury
Law ceiling on interest effective January 1, 1983. It is, however, worth stressing that
interest rates whenever unconscionable may still be declared illegal. There is nothing in
the circular which grants lenders carte blanche authority to raise interest rates to levels
which will either enslave their borrowers or lead to a hemorrhaging of
their assets.In Menchavez v. Bermudez, the interest rate of 5% per month, which when
summed up would reach 60% per annum, is null and void for being excessive, iniquitous,
unconscionable and exorbitant, contrary to morals, and the law. Florpina Benvidez v.
Nestor Salvador, G.R. No. 173331, December 11, 2013.
Damages; award of costs; when entitled. Costs shall be allowed to the prevailing party as
a matter of course unless otherwise provided in the Rules of Court. The costs Ramirez
may recover are those stated in Section 10, Rule 142 of the Rules of Court. For instance,
Ramirez may recover the lawful fees he paid in docketing his action for annulment of
sale before the trial court. The court adds thereto the amount of P3,530 or the amount of
docket and lawful fees paid by Ramirez for filing this petition before this Court. 35(35)
The court deleted the award of moral and exemplary damages; hence, the restriction
under Section 7, Rule 142 of the Rules of Courtwould have prevented Ramirez to recover
any cost of suit. But the court certifies, in accordance with said Section 7, that Ramirezs
action for annulment of sale involved a substantial and important right such that he is
entitled to an award of costs of suit. Needless to stress, the purpose of paragraph N of the
real estate mortgage is to apprise the mortgagor, Ramirez, of any action that the
mortgagee-bank might take on the subject properties, thus according him the opportunity
to safeguard his rights. Jose T. Ramirez v. The Manila Banking Corporation, G.R. No.
198800, December 11, 2013.
Damages; exemplary damages; when entitled. No exemplary damages can be awarded
since there is no basis for the award of moral damages and there is no award of
temperate, liquidated or compensatory damages.Exemplary damages are imposed by way
of example for the public good, in addition to moral, temperate, liquidated or
compensatory damages. Jose T. Ramirez v. The Manila Banking Corporation, G.R. No.
198800, December 11, 2013.

Damages; moral damages; when entitled. Nothing supports the trial courts award of
moral damages. There was no testimony of any physical suffering, mental anguish, fright,
serious anxiety, besmirched reputation, wounded feelings, moral shock, social
humiliation, and similar injury suffered by Ramirez. The award of moral damages must
be anchored on a clear showing that Ramirez actually experienced mental anguish,
besmirched reputation, sleepless nights, wounded feelings or similar injury. Ramirezs
testimony is also wanting as to the moral damages he suffered.Jose T. Ramirez v. The
Manila Banking Corporation, G.R. No. 198800, December 11, 2013.
Foreclosure; extrajudicial foreclosure; notice of extrajudicial foreclosure proceedings not
necessary unless stipulated by the parties. In Carlos Lim, et al. v. Development Bank of
the Philippines, the court held that unless the parties stipulate, personal notice to the
mortgagor in extrajudicial foreclosure proceedings is not necessary because Section 3 of
Act No. 3135 only requires the posting of the notice of sale in three public places and the
publication of that notice in a newspaper of general circulation. In this case, the parties
stipulated in paragraph N of the real estate mortgage that all correspondence relative to
the mortgage including notifications of extrajudicial actions shall be sent to mortgagor
Ramirez at his given address. Respondent had no choice but to comply with this
contractual provision it has entered into with Ramirez. The contract is the law between
them. Hence, the court cannot agree with the bank that paragraph N of the real estate
mortgage does not impose an additional obligation upon it to provide personal notice of
the extrajudicial foreclosure sale to the mortgagor Ramirez. Jose T. Ramirez v. The
Manila Banking Corporation, G.R. No. 198800, December 11, 2013.
Foreclosure of mortgage; proceeds; obligations covered. The petitioner contends that
there was no excess or surplus that needs to be returned to the respondent because her
other outstanding obligations and those of her attorney-in-fact were paid out of the
proceeds.
The relevant provision, Section 4 of Rule 68 of the Rules of Civil Procedure, mandates
that:
Section 4. Disposition of proceeds of sale. The amount realized from the foreclosure
sale of the mortgaged property shall, after deducting the costs of the sale, be paid to the
person foreclosing the mortgage, and when there shall be any balance or residue, after
paying off the mortgage debt due, the same shall be paid to junior encumbrancers in the
order of their priority, to be ascertained by the court, or if there be no such
encumbrancers or there be a balance or residue after payment to them, then to the
mortgagor or his duly authorized agent, or to the person entitled to it.
Thus, in the absence of any evidence showing that the mortgage also covers the other
obligations of the mortgagor, the proceeds from the sale should not be applied to
them. Philippine Bank of Communication v. Mary Ann O. Yeung, G.R. No. 179691,
December 4, 2013.
Laches; concept of. Well settled is the rule that the elements of laches must be proven
positively. Laches is evidentiary in nature, a fact that cannot be established by mere
allegations in the pleadings and cannot be resolved in a motion to dismiss. At this stage

therefore, the dismissal of the complaint on the ground of laches is premature. Those
issues must be resolved at the trial of the case on the merits, wherein both parties will be
given ample opportunity to prove their respective claims and defenses. Modesto Sanchez
v. Andrew Sanchez, G.R. No. 187661, December 4, 2013.
Mortgage; redemption period; reckoning of the period of redemption by the mortgagor or
his successor-in-interest starts from the registration of the sale in the Register of Deeds.
The reckoning of the period of redemption by the mortgagor or his successor-in-interest
starts from the registration of the sale in the Register of Deeds. Although Section 6 of Act
No. 3135, as amended, specifies that the period of redemption starts from and after the
date of the sale, jurisprudence has since settled that such period is more appropriately
reckoned from the date of registration.United Coconut Planters Bank v. Christopher
Lumbo and Milagros Lumbo, G.R. No. 162757, December 11, 2013.
Obligations; force majeure; concept of force majeure. Anent petitioners reliance on force
majeure, suffice it to state that Peakstars breach of its obligations to Metro Concast
arising from the MoA cannot be classified as a fortuitous event under jurisprudential
formulation.
Fortuitous events by definition are extraordinary events not foreseeable or avoidable. It is
therefore, not enough that the event should not have been foreseen or anticipated, as is
commonly believed but it must be one impossible to foresee or to avoid. The mere
difficulty to foresee the happening is not impossibility to foresee the same.
To constitute a fortuitous event, the following elements must concur: (a) the cause of the
unforeseen and unexpected occurrence or of the failure of the debtor to comply with
obligations must be independent of human will; (b) it must be impossible to foresee the
event that constitutes the caso fortuito or, if it can be foreseen, it must be impossible to
avoid; (c) the occurrence must be such as to render it impossible for the debtor to fulfill
obligations in a normal manner; and, (d) the obligor must be free from any participation
in the aggravation of the injury or loss. Metro Concast Steel Corp., Spouses Jose S.
Dychiao and Tiu Oh Yan, et al. v. Allied Bank Corporation, G.R. No. 177921, December
4, 2013.
Obligations; modes of extinguishment. Article 1231 of the Civil Code states that
obligations are extinguished either by payment or performance, the loss of the thing due,
the condonation or remission of the debt, the confusion or merger of the rights of creditor
and debtor, compensation or novation. Metro Concast Steel Corp., Spouses Jose S.
Dychiao and Tiu Oh Yan, et al. v. Allied Bank Corporation, G.R. No. 177921, December
4, 2013.
Obligations; novation; extinctive novation distinguished from modificatory novation.To
be sure, novation, in its broad concept, may either be extinctive or modificatory. It is
extinctive when an old obligation is terminated by the creation of a new obligation that
takes the place of the former; it is merely modificatory when the old obligation subsists to
the extent it remains compatible with the amendatory agreement. In either case, however,
novation is never presumed, and the animus novandi, whether totally or partially, must
appear by express agreement of the parties, or by their acts that are too clear and

unequivocal to be mistaken. ACE Foods, Inc. v. Micro Pacific Technologies Co.,


Ltd., G.R. No. 200602, December 11, 2013.
Property; action for reconveyance; prescriptive period; exception. The Court likewise
takes note that Paraguyas complaint is likewise in the nature of an action for
reconveyance because it also prayed for the trial court to order Sps. Crucillo to surrender
ownership and possession of the properties in question to [Paraguya], vacating them
altogether . . . . Despite this, Paraguyas complaint remains dismissible on the same
ground because the prescriptive period for actions for reconveyance is ten (10) years
reckoned from the date of issuance of the certificate of title, except when the owner is in
possession of the property, in which case the action for reconveyance becomes
imprescriptible. Laura F. Paraguya v. Sps. Alma Escurel-Crucillo and Emeterio Crucillo
and the Register of Deeds of Sorsogon, G.R. No. 200265, December 2, 2013.
Property; possessor in good faith; reimbursement of necessary and useful expenses.
Dionisio was well aware that this temporary arrangement may be terminated at any time.
Respondents cannot now refuse to vacate the property or eventually demand
reimbursement of necessary and useful expenses under Articles 448 and 546 of the New
Civil Code, because the provisions apply only to a possessor in good faith, i.e., one who
builds on land with the belief that he is the owner thereof. Persons who occupy land by
virtue of tolerance of the owners are not possessors in good faith.Heirs of Cipriano
Trazona, et al. v. Heirs of Dionisio Caada, et al., G.R. No. 175874, December 11, 2013.
Property; Spanish titles can no longer be used as evidence of ownership after six (6)
months from the effectivity of PD 892. Based on Section 1 of PD 892, entitled
Discontinuance of the Spanish Mortgage System of Registration and of the Use of
Spanish Titles as Evidence in Land Registration Proceedings, Spanish titles can no
longer be used as evidence of ownership after six (6) months from the effectivity of the
law, or starting August 16, 1976. Laura F. Paraguya v. Sps. Alma Escurel-Crucillo and
Emeterio Crucillo and the Register of Deeds of Sorsogon, G.R. No. 200265, December 2,
2013.
Property; waiver of interest; when absolute and unconditional.Lucila did not say, to put
everything in proper order, I promise to waive my right to the property, which is a future
undertaking, one that is demandable only when everything is put in proper order. But she
instead said, to put everything in proper order, I hereby waive etc. The phrase hereby
waive means that Lucila was, by executing the affidavit, already waiving her right to the
property, irreversibly divesting herself of her existing right to the same. After he and his
co-owner Emelinda accepted the donation, Isabelo became the owner of half of the
subject property having the right to demand its partition.Isabelo C. Dela Cruz v. Lucila C.
Dela Cruz, G.R. No. 192383, December 4, 2013.
Quasi-contract; unjust enrichment; concept of; elements.In light of the foregoing, it is
unfair to deny petitioner a refund of all his contributions to the car plan. Under Article 22
of the Civil Code, [e]very person who through an act of performance by another, or any
other means, acquires or comes into possession of something at the expense of the latter
without just or legal ground, shall return the same to him. Antonio Locsin II v. Mekeni
Food Corporation, G.R. No. 192105, December 9, 2013.

Quasi-contract; concept of quasi-contract. Article 2142 of the same Code likewise


clarifies that there are certain lawful, voluntary and unilateral acts which give rise to the
juridical relation of quasi-contract, to the end that no one shall be unjustly enriched or
benefited at the expense of another. In the absence of specific terms and conditions
governing the car plan arrangement between the petitioner and Mekeni, a quasicontractual relation was created between them.Antonio Locsin II v. Mekeni Food
Corporation, G.R. No. 192105, December 9, 2013.
Quasi-delict; elements. Article 2176 of the Civil Code provides that [w]hoever by act or
omission causes damage to another, there being fault or negligence, is obliged to pay for
the damage done. Such fault or negligence, if there is no pre-existing contractual relation
between the parties, is a quasi-delict. Under this provision, the elements necessary to
establish a quasi-delict case are: (1) damages to the plaintiff; (2) negligence, by act or
omission, of the defendant or by some person for whose acts the defendant must respond,
was guilty; and (3) the connection of cause and effect between such negligence and the
damages. These elements show that the source of obligation in a quasi-delict case is the
breach or omission of mutual duties that civilized society imposes upon its members, or
which arise from non-contractual relations of certain members of society to others.Dra.
Leila A. Dela Llana v. Rebecca Biong, doing business under the name and style of
Pongkay Trading,G.R. No. 182356, December 4, 2013.
Quasi-delict; quantum of proof; preponderance of evidence. Based on these requisites,
Dra. dela Llana must first establish by preponderance of evidence the three elements of
quasi-delict before we determine Rebeccas liability as Joels employer. She should show
the chain of causation between Joels reckless driving and her whiplash injury. Only after
she has laid this foundation can the presumption that Rebecca did not exercise the
diligence of a good father of a family in the selection and supervision of Joel
arise.Once negligence, the damages and the proximate causation are established, this
Court can then proceed with the application and the interpretation of the fifth paragraph
of Article 2180 of the Civil Code. Under Article 2176 of the Civil Code, in relation with
the fifth paragraph of Article 2180, an action predicated on an employees act or
omission may be instituted against the employer who is held liable for the negligent act
or omission committed by his employee.The rationale for these graduated levels of
analyses is that it is essentially the wrongful or negligent act or omission itself which
creates the vinculum juris in extra-contractual obligations. Dra. Leila A. Dela Llana v.
Rebecca Biong, doing business under the name and style of Pongkay Trading, G.R. No.
182356, December 4, 2013.
Sales; car plan benefit; contributions as installment payments distinguished from rental
payments. From the evidence on record, it is seen that the Mekeni car plan offered to
petitioner was subject to no other term or condition than that Mekeni shall cover one-half
of its value, and petitioner shall in turn pay the other half through deductions from his
monthly salary. Mekeni has not shown, by documentary evidence or otherwise, that there
are other terms and conditions governing its car plan agreement with petitioner. There is
no evidence to suggest that if petitioner failed to completely cover one-half of the cost of
the vehicle, then all the deductions from his salary going to the cost of the vehicle will be

treated as rentals for his use thereof while working with Mekeni, and shall not be
refunded. Indeed, there is no such stipulation or arrangement between them. Thus, the
CAs reliance on Elisco Tool is without basis, and its conclusions arrived at in the
questioned decision are manifestly mistaken. To repeat what was said in Elisco Tool,
[P]etitioner does not deny that private respondent Rolando Lantan acquired the vehicle
in question under a car plan for executives of the Elizalde group of companies. Under a
typical car plan, the company advances the purchase price of a car to be paid back by the
employee through monthly deductions from his salary. The company retains ownership
of the motor vehicle until it shall have been fully paid for. However, retention of
registration of the car in the companys name is only a form of a lien on the vehicle in the
event that the employee would abscond before he has fully paid for it. There are also
stipulations in car plan agreements to the effect that should the employment of the
employee concerned be terminated before all installments are fully paid, the vehicle will
be taken by the employer and all installments paid shall be considered rentals per
agreement.
It was made clear in this pronouncement that installments made on the car plan may be
treated as rentals only when there is an express stipulation in the car plan agreement to
such effect. It was therefore patent error for the appellate court to assume that, even in the
absence of express stipulation, petitioners payments. Antonio Locsin II v. Mekeni Food
Corporation, G.R. No. 192105, December 9, 2013.
Sales; contract of sale; elements; distinguished from contract to sell. Corollary thereto, a
contract of sale is classified as a consensual contract, which means that the sale is
perfected by mere consent. No particular form is required for its validity. Upon perfection
of the contract, the parties may reciprocally demand performance, i.e., the vendee may
compel transfer of ownership of the object of the sale, and the vendor may require the
vendee to pay the thing sold.
In contrast, a contract to sell is defined as a bilateral contract whereby the prospective
seller, while expressly reserving the ownership of the property despite delivery thereof to
the prospective buyer, binds himself to sell the property exclusively to the prospective
buyer upon fulfillment of the condition agreed upon, i.e., the full payment of the purchase
price. A contract to sell may not even be considered as a conditional contract of sale
where the seller may likewise reserve title to the property subject of the sale until the
fulfillment of a suspensive condition, because in a conditional contract of sale, the first
element of consent is present, although it is conditioned upon the happening of a
contingent event which may or may not occur. ACE Foods, Inc. v. Micro Pacific
Technologies Co., Ltd., G.R. No. 200602, December 11, 2013.
Sales; contract to sell; concept of.Verily, in a contract to sell, the prospective seller binds
himself to sell the property subject of the agreement exclusively to the prospective buyer
upon fulfillment of the condition agreed upon which is the full payment of the purchase
price but reserving to himself the ownership of the subject property despite delivery
thereof to the prospective buyer.The full payment of the purchase price in a contract to
sell is a suspensive condition, the non-fulfillment of which prevents the prospective
sellers obligation to convey title from becoming effective, as in this case. Optimum

Development Bank v. Spouses Benigno v. Jovellanos and Lourdes R. Jovellanos, G.R.


No. 189145, December 4, 2013.
Sales; contract to sell; real property in installments; covered by Realty Installment Buyer
Protection Act. Further, it is significant to note that given that the Contract to Sell in this
case is one which has for its object real property to be sold on an installment basis, the
said contract is especially governed by and thus, must be examined under the
provisions of RA 6552, or the Realty Installment Buyer Protection Act, which
provides for the rights of the buyer in case of his default in the payment of succeeding
installments. Optimum Development Bank v. Spouses Benigno v. Jovellanos and Lourdes
R. Jovellanos, G.R. No. 189145, December 4, 2013.
SPECIAL LAWS
Property Registration Decree; alienable lands of public domain; proof of; to prove that
the land subject of an application for registration is alienable, an applicant must establish
the existence of a positive act of the Government. The burden of proof in overcoming the
presumption of State ownership of lands of the public domain is on the person applying
for registration, or in this case, for homestead patent. The applicant must show that the
land subject of the application is alienable or disposable. It must be stressed that
incontrovertible evidence must be presented to establish that the land subject of the
application is alienable or disposable.
As the court pronounced in Republic of the Phils. v. Tri-Plus Corporation, to prove that
the land subject of an application for registration is alienable, an applicant must establish
the existence of a positive act of the Government such as a presidential proclamation or
an executive order, an administrative action, investigation reports of Bureau of Lands
investigators, and a legislative act or statute. The applicant may also secure a certification
from the Government that the lands applied for are alienable and disposable. Republic of
the Philippines-Bureau of Forest Development v. Vicente Roxas, et al./Provident Tree
Farms, Inc. v. Vicente Roxas, et al., G.R. Nos. 157988/160640, December 11, 2013.
Property Registration Decree; estoppel; the principle of estoppel does not operate against
the Government for the act of its agents. Neither can respondent Roxas successfully
invoke the doctrine of estoppel against petitioner Republic. While it is true that
respondent Roxas was granted Homestead Patent No. 111598 and OCT No. P-5885 only
after undergoing appropriate administrative proceedings, the Government is not now
estopped from questioning the validity of said homestead patent and certificate of title. It
is, after all, hornbook law that the principle of estoppel does not operate against the
Government for the act of its agents. And while there may be circumstances when
equitable estoppel was applied against public authorities, i.e., when the Government did
not undertake any act to contest the title for an unreasonable length of time and the lot
was already alienated to innocent buyers for value, such are not present in this case. More
importantly, we cannot use the equitable principle of estoppel to defeat the law. Republic
of the Philippines-Bureau of Forest Development v. Vicente Roxas, et al./Provident Tree
Farms, Inc. v. Vicente Roxas, et al., G.R. Nos. 157988/160640, December 11, 2013.
Property Registration Decree; homestead patent; once registered, the certificate of title
issued by virtue of said patent has the force and effect of a Torrens title issued under said

registration laws; provided that the land covered by said certificate is a disposable public
land within the contemplation of the Public Land Law.It is true that once a homestead
patent granted in accordance with the Public Land Act is registered pursuant to Act 496,
otherwise known as The Land Registration Act, or Presidential Decree No. 1529,
otherwise known as The Property Registration Decree, the certificate of title issued by
virtue of said patent has the force and effect of a Torrens title issued under said
registration laws.We expounded in Ybaez v. Intermediate Appellate Court that:
The certificate of title serves as evidence of an indefeasible title to the property in favor
of the person whose name appears therein. After the expiration of the one (1) year period
from the issuance of the decree of registration upon which it is based, it becomes
incontrovertible. The settled rule is that a decree of registration and the certificate of title
issued pursuant thereto may be attacked on the ground of actual fraud within one (1) year
from the date of its entry and such an attack must be direct and not by a collateral
proceeding. The validity of the certificate of title in this regard can be threshed out only
in an action expressly filed for the purpose.
It must be emphasized that a certificate of title issued under an administrative proceeding
pursuant to a homestead patent, as in the instant case, is as indefeasible as a certificate of
title issued under a judicial registration proceeding, provided the land covered by said
certificate is a disposable public land within the contemplation of the Public Land
Law. Republic of the Philippines-Bureau of Forest Development v. Vicente Roxas, et
al./Provident Tree Farms, Inc. v. Vicente Roxas, et al.,G.R. Nos. 157988/160640,
December 11, 2013.
Property Registration Decree; reversion; nature of; grounds. We do not find evidence
indicating that respondent Roxas committed fraud when he applied for homestead patent
over the subject property. It does not appear that he knowingly and intentionally
misrepresented in his application that the subject property was alienable and disposable
agricultural land. Nonetheless, we recognized in Republic of the Phils. v. Mangotara that
there are instances when we granted reversion for reasons other than fraud:
Reversion is an action where the ultimate relief sought is to revert the land back to the
government under the Regalian doctrine. Considering that the land subject of the action
originated from a grant by the government, its cancellation is a matter between the
grantor and the grantee. In Estate of the Late Jesus S. Yujuico v. Republic (Yujuico
case), reversion was defined as an action which seeks to restore public land fraudulently
awarded and disposed of to private individuals or corporations to the mass of public
domain. It bears to point out, though, that the Court also allowed the resort by the
Government to actions for reversion to cancel titles that were void for reasons other than
fraud, i.e., violation by the grantee of a patent of the conditions imposed by law; and lack
of jurisdiction of the Director of Lands to grant a patent covering inalienable forest land
or portion of a river, even when such grant was made through mere oversight. In
Republic v. Guerrero, the Court gave a more general statement that the remedy of
reversion can be availed of only in cases of fraudulent or unlawful inclusion of the land
in patents or certificates of title.Republic of the Philippines-Bureau of Forest

Development v. Vicente Roxas, et al./Provident Tree Farms, Inc. v. Vicente Roxas, et


al., G.R. Nos. 157988/160640, December 11, 2013.
Property Registration Decree; Torrens certificate of title is not conclusive proof of
ownership. It is an established rule that a Torrens certificate of title is not conclusive
proof of ownership. Verily, a party may seek its annulment on the basis of fraud or
misrepresentation. However, such action must be seasonably filed, else the same would
be barred. Laura F. Paraguya v. Sps. Alma Escurel-Crucillo and Emeterio Crucillo and
the Register of Deeds of Sorsogon, G.R. No. 200265, December 2, 2013.
Property Registration Decree; Torrens certificate of title is not conclusive proof of
ownership becomes incontrovertible and indefeasible after one (1) year from the date of
its entry. In this relation, Section 32 of PD 1529 provides that the period to contest a
decree of registration shall be one (1) year from the date of its entry and that, after the
lapse of the said period, the Torrens certificate of title issued thereon becomes
incontrovertible and indefeasible, viz.:
Sec. 32. Review of decree of registration; Innocent purchaser for value. The decree of
registration shall not be reopened or revised by reason of absence, minority, or other
disability of any person adversely affected thereby, nor by any proceeding in any court
for reversing judgments, subject, however, to the right of any person, including the
government and the branches thereof, deprived of land or of any estate or interest therein
by such adjudication or confirmation of title obtained by actual fraud, to file in the proper
Court of First Instance a petition for reopening and review of the decree of registration
not later than one year from and after the date of the entry of such decree of registration,
but in no case shall such petition be entertained by the court where an innocent purchaser
for value has acquired the land or an interest therein, whose rights may be prejudiced.
Whenever the phrase innocent purchaser for value or an equivalent phrase occurs in
this Decree, it shall be deemed to include an innocent lessee, mortgagee, or other
encumbrancer for value.
Upon the expiration of said period of one year, the decree of registration and the
certificate of title issued shall become incontrovertible. Any person aggrieved by such
decree of registration in any case may pursue his remedy by action for damages against
the applicant or any other persons responsible for the fraud. (Emphases and underscoring
supplied) Laura F. Paraguya v. Sps. Alma Escurel-Crucillo and Emeterio Crucillo and
the Register of Deeds of Sorsogon, G.R. No. 200265, December 2, 2013.