G.R. No.

76265 April 22, 1992

VIRGINIA CALALANG, petitioner,

Vs.

REGISTER OF DEEDS OF QUEZON CITY, ADMINISTRATOR OF NATIONAL LAND TITLES AND DEEDS
REGISTRATION ADMINISTRATION, LUCIA DE LA CRUZ, CONSTANCIO SIMANGAN and IGLESIA NI KRISTO,
respondents.

G.R. No. 83280 April 22, 1992

AUGUSTO M. DE LEON, JOSE M. DE CASTRO, JOSE A. PANLILEO, FELICIDAD VERGARA VDA. DE PINEDA,
FERNANDO L. VITUG I, FERNANDO M. VITUG II, FERNANDO M. VITUG III, FAUSTINO TOBIA, ELENA M.
OSTREA and FELISA C. CRISTOBAL-GENEROSO, petitioners,

Vs.

THE HON. COURT OF APPEALS and BISHOP ERAÑO MANALO, respondents.

GUTIERREZ, JR., J.:

The subject of controversy in these two consolidated petitions is a parcel of land — Lot 671-A of the Piedad
Estate located in Barrio Culiat, Diliman.

The petitioners are individual lot owners who claim to have bought their respective portions from Amando
Clemente in the 1950’s.

Amando Clemente is alleged to be the registered owner of said land evidenced by Transfer of Certificate
Title No. 16212 covering about 81,160 square meters who converted it into a subdivision known as
Clemville Subdivision.

Lot 671-A is actually part of a bigger parcel known as Lot 671 which is claimed by respondent Iglesia ni
Kristo (INK), which bought said property from Lucia dela Cruz in 1975. Dela Cruz was adjudged the rightful
owner of Lot 671 in the case of dela Cruz v. dela Cruz (130 SCRA 666 [1984]). INK began fencing the whole
area and placed the following sign “NO TRESPASSING — IGLESIA NI KRISTO PROPERTY SUPREME COURT
CASE NO. 61969, July 25, 1984.”

Briefly, the dela Cruz v. dela Cruz case is an action for reconveyance founded on breach of trust filed by
Augustina dela Cruz, et al. against Lucia dela Cruz and INK. Augustina and her co-plaintiffs charged that
the parcel of land purchased by the INK from Lucia dela Cruz was actually a part of their inheritance share
in the estate of their late grandfather, Policarpio dela Cruz but which, in breach of trust known to the INK,
Lucia sold to the latter.

Augustina’s suit was originally decided in her favor by the trial court. On appeal to the Court of Appeals,
the judgment was reversed and the questioned sale by Lucia dela Cruz to the INK was upheld.
Consequently, Augustina went to the Supreme Court on a petition for review on certiorari, docketed as
G. R. No. 61969.

On July 25, 1984, the Court rendered a decision in affirming the decision of the Court of Appeals. The
validity of the sale of Lucia to the INK was thereby upheld and the title of INK to the subject realty (Lot
671) was validated as well.

This Supreme Court decision spawned the two (2) petitions now before us assailing the validity of Lucia
dela Cruz’s title over Lot 671 which in turn was sold to INK.

In G.R. No. 76265, petitioner Virginia Calalang alleged that she is the registered owner of a portion of Lot
671-A (subdivision plan –– PSD 32221) as evidenced by TCT Nos. 17556, 17564 and 17562. She allegedly
came to know of INK’S claim only when a prospective buyer inspected the land on August 1986 and saw
the “no trespassing” sign.

Petitioner Calalang lost no time in inquiring into the status of the land and learned about the pending
consulta case (LRC 1978) filed before the Administrator of the National Land Titles and Deeds Registration
Administration (NLTDRA). This consulta came about when the Register of Deeds doubted the registrability
of the documents presented before it in the light of his findings that the land affected was covered by two
(2) sets of titles issued in the names of different owners.

On September 9, 1986, the petitioner filed a Motion to Intervene requesting the Administrator to conduct
an investigation of the supposed anomaly committed in connection with the reconstitution of TCT No. RT-
58 in the name of Lucia dela Cruz. This was denied by the Administrator invoking our ruling in dela Cruz v.
dela Cruz to the effect that TCT RT-58 in the name of respondent Lucia dela Cruz is the valid title. (Rollo,
pp. 44-47)

Consequently, a Motion for Reconsideration was filed by herein petitioner but this was likewise denied
by the Administrator on October 20, 1986 on the ground that the issues raised therein have already been
passed upon and that the issues being litigious in nature cannot be decided in a consulta case “where the
only question to be determined is the registrability of the document presented for registration.”

Hence, on October 27, 1986, the petitioner file the instant Special Civil Action for Certiorari and Prohibition
in G.R. No. 76265 against the Administrator of the NLTDRA, the Register of Deeds of Quezon City and
private respondents Lucia dela Cruz, Constancio Simangan and Iglesia ni Kristo. Lucia dela Cruz and
Constancio Simangan were impleaded as they were predecessors-in-interest of INK.

INK and the Administrator filed their comments on January 5, 1987 and June 29, 1987 respectively. For
failure to locate Constancio Simangan’s whereabouts despite diligent efforts and considering further that
INK is the indispensable party and the one interested in upholding the validity of the reconstituted title of
respondent Lucia dela Cruz, the petitioner moved to drop him as respondent. This was granted by the
Court in a resolution dated April 13, 1988. (Rollo, p. 189)

Taking the cue from the Administrator that present certificates of title must be cancelled to avoid
duplication, the Register of Deeds, instead of filing its comment initiated cancellation proceedings of more
than 100 titles, against 81 defendants which included herein petitioner on the basis of this Court’s
declaration in the case of dela Cruz that the reconstituted title of respondent Lucia dela Cruz is the valid
title. This petition was filed by the Office of the Solicitor-General (OSG) on January 5, 1987 with the
Regional Trial Court of Quezon City docketed as Civil Case No. Q-49900.

Consequently, the petitioner moved to dismiss on the ground that the complaint was premature and
maliciously filed with knowledge of the instant petition with this Court. INK, on the other hand, filed a
Motion to Intervene in said case. Claiming ownership over Lot 671, it prayed for damages against some of
the defendants namely Augusto de Leon, Jose M. Panlilio and Felicidad Vda. De Pineda who filed an
injunction suit against it (Civil Case No. Q-45767) with the Regional Trial Court (RTC) of Quezon City on
September 12, 1985.

Despite opposition of the petitioner to respondent INK’s Motion to Intervene, presiding Judge Benigno T.
Dayaw granted the motion of INK and denied petitioner’s Motion to Dismiss on the ground that the issues
raised in the instant petition (G. R. No. 76265) will not substantially affect said civil case. The subsequent
motion for reconsideration filed by the petitioner was likewise denied considering that no restraining
order has been issued (Rollo, pp. 198-216).
However, instead of filing an answer to the complaint in Civil Case No. Q-49900, the petitioners filed on
July 15, 1988 a supplemental petition before this Court to include as additional respondent, the Honorable
Judge Benigno T. Dayaw and petitioner’s children who were named as defendants in said Civil Case, as
additional petitioners. At the same time the petitioner prayed for a restraining order (Rollo, p.197).

To this supplemental petition, the OSG in behalf of the Republic filed its comment pursuant to the Court’s
resolution granting the petitioner’s motion for leave to include additional parties and to admit
supplemental petition (Rollo, p. 228).

In the meantime, fire gutted the records of the Register of Deeds in Quezon City, so respondent Judge
required the parties to agree to a stipulation of facts instead of trial.

In G.R. No. 83280, the petitioners alleged that they and/or their predecessors in interest were issued their
corresponding titles to the lots purchased from Amando Clemente in the 1950’s yet.

They alleged that they took physical possession of their lots in Clemville Subdivision by actually occupying
the same, declaring them in their names for tax purposes, fencing or marking them off and entrusting
their care to “katiwalas”. From the time they acquired their Torrens Title they and they alone to the
exclusion of INK exercised all acts of undisturbed, peaceful and uninterrupted ownership and possession
including the payment of their realty taxes.

On or about the second week of August, 1985, INK started to enclose the entire Clemville Subdivision with
“sawali” fences with billboards randomly posted which read:

NO TRESPASSING

I.N.C. PROPERTY

SC DECISION

2ND DIVISION

G. R. NO. L 61969

JULY 25, 1984

INK also destroyed the concrete/hollow block fence surrounding the lot of petitioner de Castro and started
the construction of housing structures therein. At the same time, it commenced the delivery of
construction materials to the former premises of petitioner Panlilio to erect a permanent structures of
strong materials on it.

Thus, on August 22, 1985, the petitioners filed with the RTC-Branch 101 a petition for injunction with
damages. This case was docketed an Civil Case No. 45767. Later, this petition was amended to include
Elena Ostrea and Feliza C. Cristobal-Generoso as additional petitioners.

August 25, 1985, presiding Judge Santiago issued a restraining order and set the case for hearing the writ
for preliminary injunction on September 5, 1985.

The September 5 hearing was however, reset to September 19, 1985 with respondent Eraño Manalo
volunteering to maintain the status quo until then or until the matter had been resolved by the trial court.

On September 19, by agreement of the parties and in open court, the Judge issued an order, granting the
parties’ motion to enter into a stipulation of facts instead of going on with the hearing and to maintain
the status quo.

In the course of the exchange of pleadings between the parties, the trial judge issued an Order on
December 6, 1985 denying the petitioners’ prayer for the issuance of a writ of preliminary injunction on
the grounds that:

From the exchange of written arguments and the authorities cited, it appears that the petitioners’ titles
which were issued some ten years earlier than that of respondent’s emanated from a reconstituted TCT
No. RT-52, which covered portion of Lot 671 of the Piedad Estate of Quezon City. Petitioner’s parcels of
land are within that estate. This reconstituted TCT No. RT-52 was the subject of a case, “De la Cruz v. De
la Cruz”, 130 SCRA 66 [1984], wherein the Honorable Supreme Court declared the said reconstituted title
null and void.

The principal argument of petitioners that they were not parties thereto can not be given serious
extended discussion as they could acquire no more rights than the source of their titles. For brevity, at
this initial stage, suffice it to say that under the foregoing discussed circumstances, the petitioners have
not shown a clear and positive right to a temporary relief. (Emphasis supplied) (Rollo, p. 35)
Assailing this order, the petitioners by way of certiorari elevated the matter to the Court of Appeals in CA-
G.R. SP No. 08146.

On April 9, 1986, the Court of Appeals promulgated a Decision with the following dispositive portion:

WHEREFORE, the petition is given due course and is hereby RESOLVED by setting aside the Order dated
December 6, 1985 in Civil Case No. Q-45767 and directing that the application for preliminary injunctive
relief therein be properly heard and evidence for or against the same be adduced in due course. (Rollo, p.
39)

On February 12, 1987, respondent INK filed with the lower court a motion to dismiss the petitioners’
complaint for injunction on the ground that it does not state a cause of action.

On August 7, 1987, the lower court issued an Order with the following dispositive portion:

WHEREFORE, premises considered, finding respondent’s Motion to Dismiss justified, the instant petition
is hereby DISMISSED, with costs against petitioners. (Rollo, p. 48)

Seeking relief from the dismissal, the petitioners filed the two pleadings, to wit:

“Motion for Reconsideration Ad Cautelam” dated September 18, 1987 filed with the RTC, NCR, Branch
101 Quezon City; and

“Omnibus Motion Incident to Execution of the Decision dated April 9, 1986” dated September 29, 1987
filed with the Court of Appeals.

On December 10, 1987, the Court of Appeals denied petitioners’ Omnibus Motion. The petitioners’ motion
for reconsideration was likewise denied in a resolution by the RTC dated May 4, 1988.

Hence, the instant petition with the following assignment of errors.

THE HONORABLE COURT OF APPEALS, IN ITS DECEMBER 10, 1987 RESOLUTION, ERRED IN HOLDING THAT
THE ORDERS OF DECEMBER 12, 1986 AND AUGUST 7, 1986 RELATE TO INCIDENTS IN CIVIL CASE NO. 45767
TOTALLY ALIEN TO THE SUBJECT MATTER OF CA-G.R. SP NO. 08146.

THE HONORABLE COURT OF APPEALS ERRED IN VALIDATING THE ORDER OF AUGUST 7, 1986. (Rollo, p.
16)

In a resolution dated August 30, 1989, G.R. No. 83280 was consolidated with G.R. No. 76265.

Although other minor issues are involved in these consolidated cases, the principal and crucial issue that
alone needs to be resolved is the applicability of this Court’s decision in the dela Cruz case to these cases
now before us.

The petitioners argue that the dela Cruz case could not be applied to them since they were not parties in
that case nor were they ever notified of such case pending between the parties. The petitioners explained
that the de la Cruz case was a case among the heirs of Policarpio de la Cruz. Since they acquired their
properties from an entirely different person, Amando Clemente and not from any of the heirs of Policarpio
de la Cruz, they could not be considered privies to any of them.

In denying applicability, however, the petitioners assail the Court’s ruling that “the reconstituted title of
Lucia dela Cruz over Lot 671 (TCT No. RT 58) was valid. As the registered and rightful owner, Lucia dela
Cruz had the perfect and legal right to sell, assign, and convert the property to respondent INK who as
purchaser for value in good faith holds the same free from all encumbrances except those noted in said
certificate.”

With this Court’s ruling promulgated in 1984, it is our considered view that the petitioner can not raise
anew the question of ownership of Lucia dela Cruz over Lot 671 which had been determined by the Court
of Appeals and affirmed by the Supreme Court in the dela Cruz case. Well-settled is the rule enunciated
in Church Assistance Program, Inc. v. Sibulo, 171 SCRA 408 [1989] that:

When a right or fact has been judicially tried and determined by a court of competent jurisdiction, so long
as it remains unreversed, it should be conclusive upon the parties and those in privity with them in law or
estate.
The Court’s ruling has long been final and the issue on ownership of Lot 671 finally disposed of several
years ago. This declaration must be respected and followed in the instant case applying the principle of
res judicata or, otherwise, the rule on conclusiveness of judgment. The less familiar concept or less
terminological usage of res judicata as a rule on conclusiveness of judgment refers to the situation where
the judgment in the prior action operates as an estoppel only as to the matters actually determined
therein or which were necessarily included therein (De la Cruz v. Court of Appeals, 187 SCRA 165 [1990]).

Inevitably, the dela Cruz ruling should be applied to the present petitions since the facts on which such
decision was predicated continue to be the facts of the case before us now (See Rivas v. SEC, 190 SCRA
295 [1990]). Even the petitioners substantially adopt the same findings of facts in their pleadings. The
factual inquiry with regards to the history of Lot 671 has already been laid to rest and may no longer be
disturbed. We quote:

The undisputed facts indicate that the parcel of land in question is Lot 671 of the Piedad Estate, GLRO Rec.
No. 5975, with an area of 184, 268 square meters, more or less, situated in Barrio Culiat, Quezon City; that
the totality of the Piedad Estate consists of a vast tract of land, registered on March 12, 1912, in the name
of the Philippine Government, under Original Certificate of Title (OCT) No. 614 of the Register of Deeds of
the Province of Rizal; that when the Piedad Estate was subdivided (with Lot No. 671 as one of the resulting
parcels) whoever was in possession of a particular lot was given priority and/or preference in the
acquisition thereof provided that the price and the cost of titling would be paid; that upon such payment,
the government would issue the corresponding certificate of title; that Policarpio dela Cruz and his wife
Luciana Rafael were originally in possession of the land; that they had three children, namely

Maximo de la Cruz (married to Feliza Yabut);

Filomeno de la Cruz (married to Narcisa Santiago); and

Defendant-appellant Lucia de la Cruz (a widow);

That the plaintiffs-appellees herein are the descendants of the two sons (Maximo and Filomeno) of
Policarpio; that on April 25, 1940, Lot No. 671 was segregated from the totality of the Piedad Estate,
covered by OCT No. 614 and a separate title was issued in the name of

“Eugenia de la Paz, soltera” and “Dorotea de la Cruz, viuda”

(this was Transfer Certificate of Title (TCT) No. 40355 of the Register of Deeds for the Province of Rizal);
that on November 29, 1941, a deed of sale over Lot No. 671 was executed by Eugenia de la Paz and
Dorotea de la Cruz (the registered owners) in favor of defendant-appellant Lucia de la Cruz; that said deed
of sale was registered with the office of the Register of Deeds on July 17, 1943 and the corresponding
certificate of title was issued to Lucia de la Cruz; that in 1971, Lucia de la Cruz obtained from the land
registration court a reconstituted title (TCT No. RT-59 over Lot No. 671), the transfer certificate of title
previously issued to her in 1943 having been lost; that subsequently, Lot No. 671 (this time, already
covered by TCT No. RT-58) was subdivided into three (3) lots, each of which was issued a separate title, as
follows:

Lot No. 671-A containing an area of 30,000 square meters and covered by TCT No. 168320;

Lot No. 671-B, containing an area of 4,268 square meters and covered by TCT No. 168321; and

© Lot No. 671-C, containing an area of 150,000 square meters and covered by TCT No. 168322;

That meanwhile TCT No. 40355 (already previously issued to and in the names of Eugenia de la Paz and
Dorotea de la Cruz) continued to exist; that when the title was transferred from the Rizal Registry to the
Quezon City Registry, from the latter Registry assigned to this TCT a new number, RT-52; that this same
Lot (No. 671) was later subdivided into two lots, each with a title:

Lot No. 671-A (TCT No. 16212)

Lot No. 671-B (TCT No. 16213)

Both in the names of Eugenia de la Paz and Dorotea de la Cruz; that the second lot (lot No. 671-B, with an
area of 103,108 square meters) was sold on December 17, 1952 to one Narcisa Vda. De Leon (to whom
TCT No. 2009 was later issued); that on May 6, 1964, Narcisa Vda. De Leon transferred the same Lot 671-
B to Nieves Paz Eraña (who was later issued in her own name TCT No. 79971).
The undisputed facts further show that in 1971, Nieves Paz Eraña filed before the Court of First instance
of Quezon City Civil Case No. 16125 for ‘quieting of title’ against Lucia de la Cruz, et al., praying that TCT
No. RT-58, (the reconstituted title of Lucia de la Cruz), as well as all titles derived therefrom, be declared
null and void; that the case ended with the parties submitting a compromise agreement with Lucia de la
Cruz, among other things, paying plaintiff Eraña the amount of P250,000.00 to cover the acquisitive cost
of the 103,108 square meters of land included in the certificate of title of defendant Lucia de la Cruz; that
on July 17, 1975, Lucia de la Cruz sold a portion of Lot No. 671-C (one of the three portions to which the
lot included in RT-58 had been subdivided, and which portion was covered by TCT No. 168322), consisting
of 103,108 square meters to defendant-appellant Iglesia Ni Cristo, for the amount of P2,108,850.00; that
this sale was later registered in the Registry of Deeds of Quezon City, with a new title, TCT No. 209554
being issued in the name of the Iglesia Ni Cristo; that another deed of absolute sale was executed for the
remaining 84,356 square meters in favor also of the Iglesia and said sale was annotated on TCT No.
168322. In view of said sales and the fact that registration of the involved parcels is now in the name
(separately) of Lucia de la Cruz and the Iglesia Ni Cristo, the present action for reconveyance with damages
was instituted. (Emphasis supplied)

Apparently, there is no mention of Amando Clemente in the above recital of facts. A closer perusal of the
records in G. R. 76265 would, however, reveal that TCT No. 16212 was issued for Lot 671-A in the name
of Amando Clemente on August 9, 1951 per report of the Acting Administrator of the NLTDRA (Rollo, p.
92). Amando Clemente’s TCT No. 16212 emanated from TCT No. 40355 in the name of Eugenia de la Paz
and Dorotea dela Cruz. Thus, Amando Clemente’s predecessors-in-interest are Eugenia dela Paz and
Dorotea dela Cruz whom the Court found to have lost their rights over Lot 671 by virtue of the sale made
to Lucia dela Cruz.

The Register of Deeds correctly observed that this is a clear case where there is a duplication or
overlapping of titles issued to different names over the same land which thereby compelled him to file
the consulta case with the NLTDRA:

Lucia dela Cruz’s reconstituted title (RT-58) which was divided into 3 Lots, Lot 671-A, Lot 671-B and Lot
671-C and was subsequently sold to INK;

Eugenia dela Paz and Dorotea dela Cruz’s reconstituted title (RT-52) which was divided into 2 lots, Lot 671-
A and Lot 671-B.

Notwithstanding, it is undisputed that Lot 671 was sold to Lucia dela Cruz by Eugenia dela Paz and Dorotea
dela Cruz as evidenced by Entry No. 258, page 7, Vol. 7, Primary Entry Book of the Registry of Deeds of
Manila. (de la Cruz v. de la Cruz, supra, pp. 697-698) This is a finding which can not be disturbed.
We need not emphasize the fact that the Supreme Court by tradition and in our system of judicial
administration, has the last word on what the law is. It is the final arbiter of any justiciable controversy.
There is only one Supreme Court from whose decisions all other courts should take their bearings.
Consequently, we cannot and should not review a case already passed upon by the Highest Tribunal. It is
only proper to allow the case to take its rest. (Church assistance Program, Inc. v. Sibulo, supra.).

The sale of the land to Lucia dela Cruz and the subsequent registration thereof in the Primary Book of the
Registry of Deeds, Manila constitutes constructive notice to the whole world. (Heirs of Maria Marasigan
v. Intermediate Appellate Court, 152 SCRA 253 [1987]; People v. Reyes, 175 SCRA 597 [1988])

Since it is the act of registration which transfers ownership of the land sold (Government Service Insurance
System v. Court of Appeals, 169 SCRA 244 [1989]). Lot 671 was already owned by Lucia dela Cruz as early
as 1943. Amando Clemente’s alleged title meanwhile which was issued on August 9, 1951 was very much
later. Thus, the petitioners, who merely stepped into the shoes of Amando Clemente cannot claim a better
right over said land. “Prior est temporae, prior est in jura” (he who is first in time is preferred in right)
(Garcia v. Court of Appeals, 95 SCRA 380 [1980]). The fact that Amando Clemente possessed a certificate
of title does not necessarily make him the true owner. And not being the owner, he cannot transmit any
right to nor transfer any title or interest over the land conveyed (Beaterio del Santisimo Rosario de Molo
v. Court of Appeals, 137 SCRA 459 [1985]; Treasurer of the Phil. V. Court of Appeals, 153 SCRA 359 [1987]).

Moreover, the petition for reconstitution of title by Lucia dela Cruz which the court held to be valid was a
proceeding in rem. It is well established that in rem proceedings such as land registration constitute
constructive notice to the whole world. The petitioners cannot now claim that they were not notified of
the reconstitution proceedings over said lot. Under the facts of the case, the title in the name of Lucia
dela Cruz (TCT No. RT 58) has become indefeasible and incontrovertible.

Likewise, the INK was also issued a Torrens Title over Lot 671 as a result of the sale made to it by the
rightful owner, Lucia dela Cruz in 1975. Under the Torrens System of registration, the Torrens Title became
indefeasible and incontrovertible one year from its final decree (Tirado v. Sevilla, 188 SCRA 321 [1990]). A
Torrens Title is generally a conclusive evidence of the ownership of the land referred to therein. (Ching v.
Court of Appeals, 181 SCRA 9 [1990]) It is, therefore, too late in the day for the petitioners to reopen or
question the legality of INK’s title over Lot 671 at this time.

The petitioners also contend that what INK purchased from Lucia dela Cruz in 1975 was Lot 671-C-4 LRC
322534 which corresponds roughly to Lot 671-B (Psd-32221) and did not affect Lot 671-A of Amando
Clemente at all. This is, however, belied by the fact that the sale made by Dorotea dela Cruz to Lucia dela
Cruz (as indicated in Entry No. 258) was Lot 671 which was later on conveyed to INK.
In challenging the validity of the reconstitution of Lucia dela Cruz’s title, the petitioners are not alleging
fraud, collusion and illegality in the procurement of the certificate of title of Lucia dela Cruz. It must be
recalled that G.R. No. 76265 stemmed merely from a consulta case with the National Land Titles and
Deeds Administration. Undeniably, the arguments and issues raised by the petitioner require adjudication
of facts which, under the circumstances of this case, we are not prepared to do as this Court is not a trier
of facts. Moreover, the present petition is not the proper remedy in challenging the validity of certificates
of titles since the judicial action required is a direct and not a collateral attack. (Natalia Realty Corp. v.
Vallez, 173 SCRA 534 [1989]).

The Court had this to say:

We note with approval the lower court’s patient explanation that, inter alia the certificate of title issued
in the name of the plaintiff in accordance with the Land Registration Act (Act No. 496) is indefeasible after
the expiration of one year from the entry of the decree of registration. Under Section 38 thereof, a petition
for review of the decree must be presented within one year after its entry as described and defined in
Section 40 of the same. After the lapse of one year, the decree of registration becomes incontrovertible
and is binding upon and conclusive against all persons whether or not they were notified of or participated
in the registration proceedings. . . .

Even assuming arguendo that said titles may still be challenged, the present case does not provide the
vehicle for that remedy since the judicial action required is a direct, and not a collateral attack. In fact,
under the existing law, Section 48 of the Property Registration Decree expressly provides that a certificate
of title cannot be subject to collateral attack and can be altered, modified or cancelled only in a direct
proceeding in accordance with law. (at p. 542)

In our capacity as the court of last resort, the petitioners try to convince us to look or inquire into the
validity of the reconstitution proceedings initiated by Lucia dela Cruz, contending that the implementation
of de la Cruz ruling would deprive them of their properties without due process of law. We have looked
long and hard into the records of the case but the facts and circumstances plus law and jurisprudence on
the matter do not warrant such action from the Court. INK’s title over Lot 671 which necessarily included
Lot 671-A had already become incontrovertible and indefeasible. To reopen or to question the legality of
INK’s title would defeat the purpose of our Torrens system which seeks to insure stability by quieting titled
lands and putting to a stop forever any question of the legality of the registration in the certificate or
questions which may arise therefrom. (de la Cruz v. de la Cruz, supra.) In fairness to INK, as registered
owner it is entitled to rest secure in its land title.
In view of all the foregoing, it would be for the public interest and the maintenance of the integrity and
stability of the Torrens system of land registration that all transfer certificates of title derived from the
reconstituted title of Eugenia dela Paz and Dorotea dela Cruz be annulled in order to prevent the
proliferation of derivative titles which are null and void. The legality or validity of INK’s title over Lot 671
has been settled. The Court has spoken and it has done so with finality, logically and rightly so as to assure
stability in legal relations and avoid confusion. (see Ver v. Quetulio, 163 SCRA 80 [1988])

WHEREFORE, the petitions in G. R. Nos. 76265 and 83280 are hereby DISMISSED for lack of merit.

SO ORDERED.

Republic of the Philippines

SUPREME COURT

Manila

EN BANC

G.R. Nos. L-21703-04 August 31, 1966

MATEO H. REYES and JUAN H. REYES, petitioners and appellants,

Vs.

MATEO RAVAL REYES, respondent and appellee.

Harold M. Hernando for petitioners and appellants.

Rafael Ruiz for respondent and appellee.

REYES, J.B.L., J.:

Direct appeal on pure question of law from an order of the Court of First Instance of Ilocos Norte, in its
Cadastral Cases Nos. 31, L. R. C. Rec. No. 1188, and 42, L. R. C. Rec. No. 1994, denying petitioners’ motion
to compel respondent to surrender their owners’ duplicates of Original Certificates of Title Nos. 22161
and 8066, as well as from a subsequent order of the same court, refusing, upon petitioners’ motion, to
reconsider the first order of denial.

The undisputed facts are: three brothers, Mateo H., Juan H., and Francisco H., all surnamed Reyes, are the
registered owners of several parcels of land, to wit; Lots Nos. 15891, 15896, 15902 and 15912, of the
Laoag (Ilocos Norte) Cadastre, embraced in and covered by Original Certificate of Title No. 22161, and also
Lots Nos. 20481 and 20484, of the same cadastral survey, embraced in and covered by Original Certificate
of Title No. 8066, both of the Registry of Deeds of Ilocos Norte. These titles were issued pursuant to a
decree of registration, dated 31 May 1940.

On 17 July 1962, petitioners Mateo H. Reyes and Juan H. Reyes filed, in the above stated cadastral cases,
a motion for issuance of writs of possession over all the lots covered by both Certificates of Title above
referred to.

Respondent Mateo Raval Reyes opposed the motion, admitting that he is only in possession of the lots
covered by Original Certificate of Title No. 22161, but denying that he possesses the lots covered by
Original Certificate of Title No. 8066; however, he claimed that he has been in, and is entitled to, the
possession thereof (i.e., Lots Nos. 20481 and 20484), having acquired by way of absolute sale (not
recorded) from petitioners’ brother, Francisco H. Reyes, the latter’s undivided one-third (1/3) share,
interest and participation to these disputed lots.

After due hearing of this appellant, the court a quo issued, on 20 December 1962, the writ of possession
with respect to Lot Nos. 15891 and 15896, which writ was, upon petitioners’ motion for reconsideration,
amended, on 7 January 1963, to include all the other lots covered by both titles.

Respondent did not appeal from this order amending the writ of possession.

Subsequently, petitioners in the above cadastral cases, as plaintiffs, commenced, on 15 January 1963,
before the same court of first instance, an ordinary civil action seeking to recover the products of the
disputed lots, or their value, and moral damages against respondent Mateo Raval Reyes, as defendant.
This case was docketed as its Civil Case No. 3659.
Defendant therein (now respondent M. Raval Reyes) answered the complaint and pleaded a counterclaim
for partition of all the disputed lots, alleging the same ground he had heretofore raised in his answer
and/or opposition to the motion for issuance of writ of possession, i.e., he is their (plaintiffs’) co-owner,
he having bought from plaintiffs’ brother, Francisco H. Reyes, the latter’s undivided one-third (1/3) share,
interest and participation to these disputed lots.

Pending trial on this ordinary civil case (No. 3659), petitioners presented, on 25 February 1963, in the
cadastral cases aforementioned, a motion to compel respondent Mateo Raval Reyes to surrender and
deliver to them the owners’ duplicates of Original Certificates of Title Nos. 22161 and 8066. Respondent
opposed this motion.

The court a quo denied petitioners’ motion, on the ground that the parcels of land covered by both titles
are subjects of litigation in Civil Case No. 3659 and the same has not yet been decided on the merits by it.
Petitioners subjected the foregoing order to a motion for reconsideration, but without success; hence,
the present appeal.

Petitioners-appellants dispute the above ruling of the trial court contending that, since the subject matter
of Civil Case No. 3659 are not the lots covered by the titles in question but their products or value, and
moral damages, these lots are not in litigation in this ordinary civil case; and that since respondent had
already raised the issue of ownership and possession of these lots in his opposition to the (petitioners’)
motion for issuance of writ of possession and, despite this opposition, the court a quo granted the writ,
without any appeal being taken, respondent is barred and estopped from raising the same issue in the
ordinary civil case, under the principle of res judicata.1äwphï1.ñët

On the other hand, respondent-appellee maintains that, having pleaded a counterclaim for partition of
the lots in question in said Civil Case No. 3659, the trial court correctly held that these lots are subjects of
litigation in this ordinary civil case. He also maintains that petitioners not having impleaded their brother,
Francisco H. Reyes, or his heirs, as parties in their motion for issuance of writ of execution, and because
these heirs have not intervened in this particular incident, the writ of possession issued by the trial court
is, at most, valid only with respect to their (petitioners) undivided two-thirds (2/3) share and participation
in these disputed lots; hence, he concludes that he is not barred and estopped from raising the issue of
ownership and possession of the undivided one-third (1/3) share and participation of petitioners’ brother,
Francisco H. Reyes, which share respondent allegedly bought from the latter.

In their reply brief, petitioners-appellants refute the latter argument of respondent-appellee by showing
that they had previously obtained special authority from the heirs of their deceased brother to represent
them in the proceedings had in the court below.
The sole issue to be resolved in the instant appeal is: who between petitioners-appellants or respondent-
appellee has a better right to the possession or custody of the disputed owners’ duplicates of certificates
of title.

While we agree with the court a quo that the disputed lots are subjects of litigation in Civil Case No. 3659,
it appearing that respondent, as defendant therein, had presented a counterclaim for partition of the lots
covered by the titles, we see no valid and plausible reason to justify, on this ground, the withholding from
the registered owners, such as the petitioners-appellants herein, the custody and possession of the
owners’ duplicates of certificates of title. In a decided case, this Court has already held that the owner of
the land in whose favor and in whose name said land is registered and inscribed in the certificate of title
has a more preferential right to the possession of the owners’ duplicate than one whose name does not
appear in the certificate and has yet to establish his right to the possession thereto. Thus, this Court said:

Como acertadamente dijo el Juzgado, lo unico que se suscita es si Ana Umbao de Carpio tiene derecho a
la possession del duplicado para el dueno del Certificado de Titulo Original No. 698, con preferencia a la
opositora-apelante. A nuestro juicio, la solucion es clara e ineludible. Hallandose admitido que el decreto
final que se dicto en el expediente catastral en 28 de mayo de 1936, en relacion con el lote No. 778, fue a
favor de Ana Umbao y que el duplicado para el dueño del Certificado de Titulo Original No. 698 se expidio
por el Registrador de Titulos a favor de la misma es obvious que quien tiene derecho a poseer el certificado
de titulo es ella y no la apelante (art. 41 de la Ley No. 496, tal como ha sido reformado).

Alega la apelante que ella tiene tanto derecho como la apelada a poseer el titulo porque el terreno a que
se refiere es de la propiedad de las tres hermanas. La pretension no es meritoria Segun el articulo 41 de
la Ley No. 496, conforme ha sido enmendado, el duplicado para el dueno debe expedirse por el
Registrador a nombre de la persona a cuyo favor se ha decretado el terreno y dispone, ademas, que dicho
duplicado debe entregarsele al dueño inscrito. Si la apelante cree que tiene derecho a participar en el lote
No. 778, como coheredera, debe ejercitar una accion independiente, encaminada a obtener su
participacion. (El Director de Terrenos contra Abacahin 72 Phil. 326).

It being undisputed that respondent had already availed of an independent civil action to recover his
alleged co-owner’s share in the disputed lots by filing a counterclaim for partition in said Civil Case No.
3659, his rights appear to be amply protected; and considering that he may also avail of, to better protect
his rights thereto, the provision on notice of lis pendens under Section 24, Rule 14, of the Revised Rules
of Court, for the purpose of recording the fact that the lots covered by the titles in question are litigated
in said Civil Case No. 3659, we again see no justifiable reason for respondent to retain the custody of the
owners’ duplicates of certificates of titles.

In view of the above considerations, we deem it unnecessary to pass on the merits of the second
contention of petitioners-appellants.
Wherefore, the orders appealed from should be, as they are hereby, reversed; and, in accordance with
this opinion, respondent Mateo Raval Reyes is hereby ordered to deliver to petitioners the owners’
duplicates of Original Certificates of Title No. 22161 and 8066. With costs against respondent-appellee,
Mateo Raval Reyes.

Concepcion, C.J., Barrera, Dizon, Makalintal, Bengzon, J.P., Zaldivar, Sanchez and Castro, JJ., concur.

Regala, J., took no part.

154409 : June 21, 2004 : J. Panganiban : First Division : Decision

[G.R. No. 154409. June 21, 2004]

Spouses NOEL and JULIE ABRIGO, petitioners, vs. ROMANA DE VERA, respondent.

DECISION

PANGANIBAN, J.:

Between two buyers of the same immovable property registered under the Torrens system, the law gives
ownership priority to (1) the first registrant in good faith; (2) then, the first possessor in good faith; and
(3) finally, the buyer who in good faith presents the oldest title. This provision, however, does not apply
if the property is not registered under the Torrens system.

The Case

Before us is a Petition for Review[1] under Rule 45 of the Rules of Court, seeking to set aside the March
21, 2002 Amended Decision[2] and the July 22, 2002 Resolution[3] of the Court of Appeals (CA) in CA-GR
CV No. 62391. The Amended Decision disposed as follows:
WHEREFORE, the dispositive part of the original DECISION of this case, promulgated on November 19,
2001, is SET ASIDE and another one is entered AFFIRMING in part and REVERSING in part the judgment
appealed from, as follows:

1. Declaring [Respondent] Romana de Vera the rightful owner and with better right to possess the
property in question, being an innocent purchaser for value therefor;

2. Declaring Gloria Villafania [liable] to pay the following to [Respondent] Romana de Vera and to
[Petitioner-]Spouses [Noel and Julie] Abrigo, to wit:

As to [Respondent] Romana de Vera:

1. P300,000.00 plus 6% per annum as actual damages;

2. P50,000.00 as moral damages;

3. P50,000.00 as exemplary damages;

4. P30,000.00 as attorneys fees; and

5. Cost of suit.

As to [Petitioner-]Spouses [Noel and Julie] Abrigo:

1. P50,000.00 as moral damages;

2. P50,000.00 as exemplary damages;

 3. P30,000.00 as attorneys fees;

4. Cost of suit.[4]

The assailed Resolution denied reconsideration.

The Facts

Quoting the trial court, the CA narrated the facts as follows:

As culled from the records, the following are the pertinent antecedents amply summarized by the trial
court:

On May 27, 1993, Gloria Villafania sold a house and lot located at Banaoang, Mangaldan, Pangasinan and
covered by Tax Declaration No. 1406 to Rosenda Tigno-Salazar and Rosita Cave-Go. The said sale became
a subject of a suit for annulment of documents between the vendor and the vendees.

On December 7, 1993, the Regional Trial Court, Branch 40 of Dagupan City rendered judgment approving
the Compromise Agreement submitted by the parties. In the said Decision, Gloria Villafania was given one
year from the date of the Compromise Agreement to buy back the house and lot, and failure to do so
would mean that the previous sale in favor of Rosenda Tigno-Salazar and Rosita Cave-Go shall remain valid
and binding and the plaintiff shall voluntarily vacate the premises without need of any demand. Gloria
Villafania failed to buy back the house and lot, so the [vendees] declared the lot in their name.

Unknown, however to Rosenda Tigno-Salazar and Rosita Cave-Go, Gloria Villafania obtained a free patent
over the parcel of land involved [on March 15, 1988 as evidenced by OCT No. P-30522]. The said free
patent was later on cancelled by TCT No. 212598 on April 11, 1996.

On October 16, 1997, Rosenda Tigno-Salazar and Rosita Cave-Go, sold the house and lot to the herein
[Petitioner-Spouses Noel and Julie Abrigo].

On October 23, 1997, Gloria Villafania sold the same house and lot to Romana de Vera x x x. Romana de
Vera registered the sale and as a consequence, TCT No. 22515 was issued in her name.
On November 12, 1997, Romana de Vera filed an action for Forcible Entry and Damages against [Spouses
Noel and Julie Abrigo] before the Municipal Trial Court of Mangaldan, Pangasinan docketed as Civil Case
No. 1452. On February 25, 1998, the parties therein submitted a Motion for Dismissal in view of their
agreement in the instant case that neither of them can physically take possession of the property in
question until the instant case is terminated. Hence the ejectment case was dismissed.[5]

Thus, on November 21, 1997, [petitioners] filed the instant case [with the Regional Trial Court of Dagupan
City] for the annulment of documents, injunction, preliminary injunction, restraining order and damages
[against respondent and Gloria Villafania].

After the trial on the merits, the lower court rendered the assailed Decision dated January 4, 1999,
awarding the properties to [petitioners] as well as damages. Moreover, x x x Gloria Villafania was ordered
to pay [petitioners and private respondent] damages and attorneys fees.

Not contented with the assailed Decision, both parties [appealed to the CA].[6]

Ruling of the Court of Appeals

In its original Decision promulgated on November 19, 2001, the CA held that a void title could not give
rise to a valid one and hence dismissed the appeal of Private Respondent Romana de Vera.[7] Since Gloria
Villafania had already transferred ownership to Rosenda Tigno-Salazar and Rosita Cave-Go, the
subsequent sale to De Vera was deemed void.

The CA also dismissed the appeal of Petitioner-Spouses Abrigo and found no sufficient basis to award
them moral and exemplary damages and attorneys fees.

On reconsideration, the CA issued its March 21, 2002 Amended Decision, finding Respondent De Vera to
be a purchaser in good faith and for value. The appellate court ruled that she had relied in good faith on
the Torrens title of her vendor and must thus be protected.[8]

Hence, this Petition.[9]

Issues

Petitioners raise for our consideration the issues below:

 1. Whether or not the deed of sale executed by Gloria Villafania in favor of [R]espondent Romana
de Vera is valid.

2. Whether or not the [R]espondent Romana de Vera is a purchaser for value in good faith.

3. Who between the petitioners and respondent has a better title over the property in question.[10]

In the main, the issues boil down to who between petitioner-spouses and respondent has a better right
to the property.

The Courts Ruling

The Petition is bereft of merit.

Main Issue:Better Right over the Property

Petitioners contend that Gloria Villafania could not have transferred the property to Respondent De Vera
because it no longer belonged to her.[11] They further claim that the sale could not be validated, since
respondent was not a purchaser in good faith and for value.[12]

Law on Double Sale

The present case involves what in legal contemplation was a double sale. On May 27, 1993, Gloria
Villafania first sold the disputed property to Rosenda Tigno-Salazar and Rosita Cave-Go, from whom
petitioners, in turn, derived their right. Subsequently, on October 23, 1997, a second sale was executed
by Villafania with Respondent Romana de Vera.

Article 1544 of the Civil Code states the law on double sale thus:

Art. 1544. If the same thing should have been sold to different vendees, the ownership shall be transferred
to the person who may have first taken possession thereof in good faith, if it should be movable property.
Should it be immovable property, the ownership shall belong to the person acquiring it who in good faith
first recorded it in the Registry of Property.

Should there be no inscription, the ownership shall pertain to the person who in good faith was first in
the possession; and, in the absence thereof, to the person who presents the oldest title, provided there
is good faith.

Otherwise stated, the law provides that a double sale of immovables transfers ownership to (1) the first
registrant in good faith; (2) then, the first possessor in good faith; and (3) finally, the buyer who in good
faith presents the oldest title.[13] There is no ambiguity in the application of this law with respect to lands
registered under the Torrens system.

This principle is in full accord with Section 51 of PD 1529[14] which provides that no deed, mortgage, lease
or other voluntary instrument – except a will – purporting to convey or affect registered land shall take
effect as a conveyance or bind the land until its registration.[15] Thus, if the sale is not registered, it is
binding only between the seller and the buyer but it does not affect innocent third persons.[16]

In the instant case, both Petitioners Abrigo and respondent registered the sale of the property. Since
neither petitioners nor their predecessors (Tigno-Salazar and Cave-Go) knew that the property was
covered by the Torrens system, they registered their respective sales under Act 3344.[17] For her part,
respondent registered the transaction under the Torrens system[18] because, during the sale, Villafania
had presented the transfer certificate of title (TCT) covering the property.[19]

Respondent De Vera contends that her registration under the Torrens system should prevail over that of
petitioners who recorded theirs under Act 3344. De Vera relies on the following insight of Justice Edgardo
L. Paras:

X x x If the land is registered under the Land Registration Act (and has therefore a Torrens Title), and it is
sold but the subsequent sale is registered not under the Land Registration Act but under Act 3344, as
amended, such sale is not considered REGISTERED, as the term is used under Art. 1544 x x x.[20]

We agree with respondent. It is undisputed that Villafania had been issued a free patent registered as
Original Certificate of Title (OCT) No. P-30522.[21] The OCT was later cancelled by Transfer Certificate of
Title (TCT) No. 212598, also in Villafanias name.[22] As a consequence of the sale, TCT No. 212598 was
subsequently cancelled and TCT No. 22515 thereafter issued to respondent.
Soriano v. Heirs of Magali[23] held that registration must be done in the proper registry in order to bind
the land. Since the property in dispute in the present case was already registered under the Torrens
system, petitioners registration of the sale under Act 3344 was not effective for purposes of Article 1544
of the Civil Code.

More recently, in Naawan Community Rural Bank v. Court of Appeals,[24] the Court upheld the right of a
party who had registered the sale of land under the Property Registration Decree, as opposed to another
who had registered a deed of final conveyance under Act 3344. In that case, the priority in time principle
was not applied, because the land was already covered by the Torrens system at the time the conveyance
was registered under Act 3344. For the same reason, inasmuch as the registration of the sale to
Respondent De Vera under the Torrens system was done in good faith, this sale must be upheld over the
sale registered under Act 3344 to Petitioner-Spouses Abrigo.

Radiowealth Finance Co. v. Palileo[25] explained the difference in the rules of registration under Act 3344
and those under the Torrens system in this wise:

Under Act No. 3344, registration of instruments affecting unregistered lands is without prejudice to a third
party with a better right. The aforequoted phrase has been held by this Court to mean that the mere
registration of a sale in ones favor does not give him any right over the land if the vendor was not anymore
the owner of the land having previously sold the same to somebody else even if the earlier sale was
unrecorded.

The case of Carumba vs. Court of Appeals[26] is a case in point. It was held therein that Article 1544 of
the Civil Code has no application to land not registered under Act No. 496. Like in the case at bar, Carumba
dealt with a double sale of the same unregistered land. The first sale was made by the original owners and
was unrecorded while the second was an execution sale that resulted from a complaint for a sum of
money filed against the said original owners. Applying [Section 33], Rule 39 of the Revised Rules of
Court,[27] this Court held that Article 1544 of the Civil Code cannot be invoked to benefit the purchaser
at the execution sale though the latter was a buyer in good faith and even if this second sale was
registered. It was explained that this is because the purchaser of unregistered land at a sheriffs execution
sale only steps into the shoes of the judgment debtor, and merely acquires the latters interest in the
property sold as of the time the property was levied upon.

Applying this principle, x x x the execution sale of unregistered land in favor of petitioner is of no effect
because the land no longer belonged to the judgment debtor as of the time of the said execution sale.[28]
Petitioners cannot validly argue that they were fraudulently misled into believing that the property was
unregistered. A Torrens title, once registered, serves as a notice to the whole world.[29] All persons must
take notice, and no one can plead ignorance of the registration.[30]

Good-Faith Requirement

We have consistently held that Article 1544 requires the second buyer to acquire the immovable in good
faith and to register it in good faith.[31] Mere registration of title is not enough; good faith must concur
with the registration.[32] We explained the rationale in Uraca v. Court of Appeals,[33] which we quote:

Under the foregoing, the prior registration of the disputed property by the second buyer does not by itself
confer ownership or a better right over the property. Article 1544 requires that such registration must be
coupled with good faith. Jurisprudence teaches us that (t)he governing principle is primus tempore, potior
jure (first in time, stronger in right). Knowledge gained by the first buyer of the second sale cannot defeat
the first buyers rights except where the second buyer registers in good faith the second sale ahead of the
first, as provided by the Civil Code. Such knowledge of the first buyer does not bar her from availing of her
rights under the law, among them, to register first her purchase as against the second buyer. But in
converso, knowledge gained by the second buyer of the first sale defeats his rights even if he is first to
register the second sale, since such knowledge taints his prior registration with bad faith. This is the price
exacted by Article 1544 of the Civil Code for the second buyer being able to displace the first buyer; that
before the second buyer can obtain priority over the first, he must show that he acted in good faith
throughout (i.e. in ignorance of the first sale and of the first buyers rights) ---- from the time of acquisition
until the title is transferred to him by registration, or failing registration, by delivery of possession.[34]
(Italics supplied)

Equally important, under Section 44 of PD 1529, every registered owner receiving a certificate of title
pursuant to a decree of registration, and every subsequent purchaser of registered land taking such
certificate for value and in good faith shall hold the same free from all encumbrances, except those noted
and enumerated in the certificate.[35] Thus, a person dealing with registered land is not required to go
behind the registry to determine the condition of the property, since such condition is noted on the face
of the register or certificate of title.[36] Following this principle, this Court has consistently held as regards
registered land that a purchaser in good faith acquires a good title as against all the transferees thereof
whose rights are not recorded in the Registry of Deeds at the time of the sale.[37]

Citing Santiago v. Court of Appeals,[38] petitioners contend that their prior registration under Act 3344 is
constructive notice to respondent and negates her good faith at the time she registered the sale. Santiago
affirmed the following commentary of Justice Jose C. Vitug:
The governing principle is prius tempore, potior jure (first in time, stronger in right). Knowledge by the
first buyer of the second sale cannot defeat the first buyer’s rights except when the second buyer first
registers in good faith the second sale (Olivares vs. Gonzales, 159 SCRA 33). Conversely, knowledge gained
by the second buyer of the first sale defeats his rights even if he is first to register, since such knowledge
taints his registration with bad faith (see also Astorga vs. Court of Appeals, G.R. No 58530, 26 December
1984) In Cruz vs. Cabana (G.R. No. 56232, 22 June 1984; 129 SCRA 656), it was held that it is essential, to
merit the protection of Art. 1544, second paragraph, that the second realty buyer must act in good faith
in registering his deed of sale (citing Carbonell vs. Court of Appeals, 69 SCRA 99, Crisostomo vs. CA, G.R.
95843, 02 September 1992).

Xxxxxxxxx

Registration of the second buyer under Act 3344, providing for the registration of all instruments on land
neither covered by the Spanish Mortgage Law nor the Torrens System (Act 496), cannot improve his
standing since Act 3344 itself expresses that registration thereunder would not prejudice prior rights in
good faith (see Carumba vs. Court of Appeals, 31 SCRA 558). Registration, however, by the first buyer
under Act 3344 can have the effect of constructive notice to the second buyer that can defeat his right as
such buyer in good faith (see Arts. 708-709, Civil Code; see also Revilla vs. Galindez, 107 Phil. 480; Taguba
vs. Peralta, 132 SCRA 700). Art. 1544 has been held to be inapplicable to execution sales of unregistered
land, since the purchaser merely steps into the shoes of the debtor and acquires the latter’s interest as of
the time the property is sold (Carumba vs. Court of Appeals, 31 SCRA 558; see also Fabian vs. Smith, Bell
& Co., 8 Phil. 496) or when there is only one sale (Remalante vs. Tibe, 158 SCRA 138).[39] (Emphasis
supplied)

Santiago was subsequently applied in Bayoca v. Nogales,[40] which held:

Verily, there is absence of prior registration in good faith by petitioners of the second sale in their favor.
As stated in the Santiago case, registration by the first buyer under Act No. 3344 can have the effect of
constructive notice to the second buyer that can defeat his right as such buyer. On account of the
undisputed fact of registration under Act No. 3344 by [the first buyers], necessarily, there is absent good
faith in the registration of the sale by the [second buyers] for which they had been issued certificates of
title in their names. X x x.[41]

Santiago and Bayoca are not in point. In Santiago, the first buyers registered the sale under the Torrens
system, as can be inferred from the issuance of the TCT in their names.[42] There was no registration
under Act 3344. In Bayoca, when the first buyer registered the sale under Act 3344, the property was still
unregistered land.[43] Such registration was therefore considered effectual.
Furthermore, Revilla and Taguba, which are cited in Santiago, are not on all fours with the present case.
In Revilla, the first buyer did not register the sale.[44] In Taguba, registration was not an issue.[45]

As can be gathered from the foregoing, constructive notice to the second buyer through registration under
Act 3344 does not apply if the property is registered under the Torrens system, as in this case.

We quote below the additional commentary of Justice Vitug, which was omitted in Santiago. This omission
was evidently the reason why petitioner misunderstood the context of the citation therein:

“The registration contemplated under Art. 1544 has been held to refer to registration under Act 496 Land
Registration Act (now PD 1529) which considers the act of registration as the operative act that binds the
land (see Mediante vs. Rosabal, 1 O.G. [12] 900, Garcia vs. Rosabal, 73 Phil 694). On lands covered by the
Torrens System, the purchaser acquires such rights and interest as they appear in the certificate of title,
unaffected by any prior lien or encumbrance not noted therein. The purchaser is not required to explore
farther than what the Torrens title, upon its face, indicates. The only exception is where the purchaser
has actual knowledge of a flaw or defect in the title of the seller or of such liens or encumbrances which,
as to him, is equivalent to registration (see Sec. 39, Act 496; Bernales vs. IAC, G.R. 75336, 18 October 1988;
Hernandez vs. Sales, 69 Phil 744; Tajonera vs. Court of Appeals, L-26677, 27 March 1981),”[46]

Respondentin Good Faith

The Court of Appeals examined the facts to determine whether respondent was an innocent purchaser
for value.[47] After its factual findings revealed that Respondent De Vera was in good faith, it explained
thus:

X x x. Gloria Villafania, [Respondent] De Veras vendor, appears to be the registered owner. The subject
land was, and still is, registered in the name of Gloria Villafania. There is nothing in her certificate of title
and in the circumstances of the transaction or sale which warrant [Respondent] De Vera in supposing that
she need[ed] to look beyond the title. She had no notice of the earlier sale of the land to [petitioners]. She
ascertained and verified that her vendor was the sole owner and in possession of the subject property by
examining her vendors title in the Registry of Deeds and actually going to the premises. There is no
evidence in the record showing that when she bought the land on October 23, 1997, she knew or had the
slightest notice that the same was under litigation in Civil Case No. D-10638 of the Regional Trial Court of
Dagupan City, Branch 40, between Gloria Villafania and [Petitioners] Abrigo. She was not even a party to
said case. In sum, she testified clearly and positively, without any contrary evidence presented by the
[petitioners], that she did not know anything about the earlier sale and claim of the spouses Abrigo, until
after she had bought the same, and only then when she bought the same, and only then when she brought
an ejectment case with the x x x Municipal Court of Mangaldan, known as Civil Case No. 1452. To the
[Respondent] De Vera, the only legal truth upon which she had to rely was that the land is registered in
the name of Gloria Villafania, her vendor, and that her title under the law, is absolute and indefeasible. X
x x.[48]

We find no reason to disturb these findings, which petitioners have not rebutted. Spouses Abrigo base
their position only on the general averment that respondent should have been more vigilant prior to
consummating the sale. They argue that had she inspected the property, she would have found petitioners
to be in possession.[49]

This argument is contradicted, however, by the spouses own admission that the parents and the sister of
Villafania were still the actual occupants in October 1997, when Respondent De Vera purchased the
property.[50] The family members may reasonably be assumed to be Villafanias agents, who had not been
shown to have notified respondent of the first sale when she conducted an ocular inspection. Thus, good
faith on respondents part stands.

WHEREFORE, the Petition is DENIED and the assailed Decision AFFIRMED. Costs against petitioners.

SO ORDERED.

REPUBLIC OF THE PHILIPPINES, G.R. No. 185091

REPRESENTED BY THE

DEPARTMENT OF EDUCATION

DIVISION OF LIPA CITY (FOR

PANINSINGIN PRIMARY SCHOOL),

Petitioner, Present:
CARPIO, J., Chairperson,

- Versus – ABAD,

VILLARAMA, JR.,*

PEREZ,** and

MENDOZA, JJ.

PRIMO MENDOZA and

MARIA LUCERO, Promulgated:

Respondents.

August 8, 2010

ABAD, J.:

This case is about the propriety of filing an ejectment suit against the Government for its failure to acquire
ownership of a privately owned property that it had long used as a school site and to pay just
compensation for it.

The Facts and the Case

Paninsingin Primary School (PPS) is a public school operated by petitioner Republic of the Philippines (the
Republic) through the Department of Education. PPS has been using 1,149 square meters of land in Lipa
City, Batangas since 1957 for its school. But the property, a portion of Lots 1923 and 1925, were registered
in the name of respondents Primo and Maria Mendoza (the Mendozas) under Transfer Certificate of Title
(TCT) T-11410.[1]

On March 27, 1962 the Mendozas caused Lots 1923 and 1925 to be consolidated and subdivided into four
lots, as follows:

Lot 1 292 square meters in favor of Claudia Dimayuga

Lot 2 292 square meters in favor of the Mendozas

Lot 3 543 square meters in favor of Gervacio Ronquillo; and

Lot 4 1,149 square meters in favor of the City Government of Lipa[2]

As a result of subdivision, the Register of Deeds partially cancelled TCT T-11410 and issued new titles for
Lots 1 and 3 in favor of Dimayuga and Ronquillo, respectively. Lot 2 remained in the name of the Mendozas
but no new title was issued in the name of the City Government of Lipa for Lot 4.[3] Meantime, PPS
remained in possession of the property.

The Republic claimed that, while no title was issued in the name of the City Government of Lipa, the
Mendozas had relinquished to it their right over the school lot as evidenced by the consolidation and
subdivision plan. Further, the property had long been tax-declared in the name of the City Government
and PPS built significant, permanent improvements on the same. These improvements had also been tax-
declared.[4]

The Mendozas claim, on the other hand, that although PPS sought permission from them to use the
property as a school site, they never relinquished their right to it. They allowed PPS to occupy the property
since they had no need for it at that time. Thus, it has remained registered in their name under the original
title, TCT T-11410, which had only been partially cancelled.

On November 6, 1998 the Mendozas wrote PPS, demanding that it vacate the disputed property.[5] When
PPS declined to do so, on January 12, 1999 the Mendozas filed a complaint with the Municipal Trial Court
in Cities (MTCC) of Lipa City in Civil Case 0002-99 against PPS for unlawful detainer with application for
temporary restraining order and writ of preliminary injunction.[6]

On July 13, 1999 the MTCC rendered a decision, dismissing the complaint on ground of the Republics
immunity from suit.[7] The Mendozas appealed to the Regional Trial Court (RTC) of Lipa City which ruled
that the Republics consent was not necessary since the action before the MTCC was not against it.[8]

In light of the RTCs decision, the Mendozas filed with the MTCC a motion to render judgment in the case
before it.[9] The MTCC denied the motion, however, saying that jurisdiction over the case had passed to
the RTC upon appeal.[10] Later, the RTC remanded the case back to the MTCC,[11] which then dismissed
the case for insufficiency of evidence.[12] Consequently, the Mendozas once again appealed to the RTC
in Civil Case 2001-0236.

On June 27, 2006 the RTC found in favor of the Mendozas and ordered PPS to vacate the property. It held
that the Mendozas had the better right of possession since they were its registered owners. PPS, on the
other hand, could not produce any document to prove the transfer of ownership of the land in its
favor.[13] PPS moved for reconsideration, but the RTC denied it.

The Republic, through the Office of the Solicitor General (OSG), appealed the RTC decision to the Court of
Appeals (CA) in CA-G.R. SP 96604 on the grounds that: (1) the Mendozas were barred by laches from
recovering possession of the school lot; (2) sufficient evidence showed that the Mendozas relinquished
ownership of the subject lot to the City Government of Lipa City for use as school; and (3) Lot 4, Pcs-5019
has long been declared in the name of the City Government since 1957 for taxation purposes.[14]

In a decision dated February 26, 2008, the CA affirmed the RTC decision.[15] Upholding the Torrens
system, it emphasized the indefeasibility of the Mendozas registered title and the imprescriptible nature
of their right to eject any person occupying the property. The CA held that, this being the case, the
Republics possession of the property through PPS should be deemed merely a tolerated one that could
not ripen into ownership.

The CA also rejected the Republics claim of ownership since it presented no documentary evidence to
prove the transfer of the property in favor of the government. Moreover, even assuming that the
Mendozas relinquished their right to the property in 1957 in the governments favor, the latter never took
steps to have the title to the property issued in its name or have its right as owner annotated on the
Mendozas title. The CA held that, by its omissions, the Republic may be held in estoppel to claim that the
Mendozas were barred by laches from bringing its action.

With the denial of its motion for reconsideration, the Republic has taken recourse to this Court via petition
for review on certiorari under Rule 45.

The Issue Presented

The issue in this case is whether or not the CA erred in holding that the Mendozas were entitled to evict
the Republic from the subject property that it had used for a public school.

The Courts Ruling

A decree of registration is conclusive upon all persons, including the Government of the Republic and all
its branches, whether or not mentioned by name in the application for registration or its notice.[16]
Indeed, title to the land, once registered, is imprescriptible.[17] No one may acquire it from the registered
owner by adverse, open, and notorious possession.[18] Thus, to a registered owner under the Torrens
system, the right to recover possession of the registered property is equally imprescriptible since
possession is a mere consequence of ownership.

Here, the existence and genuineness of the Mendozas title over the property has not been disputed. While
the consolidation and subdivision plan of Lots 1923 and 1925 shows that a 1,149 square meter lot had
been designated to the City Government, the Republic itself admits that no new title was issued to it or
to any of its subdivisions for the portion that PPS had been occupying since 1957.[19]

That the City Government of Lipa tax-declared the property and its improvements in its name cannot
defeat the Mendozas title. This Court has allowed tax declarations to stand as proof of ownership only in
the absence of a certificate of title.[20] Otherwise, they have little evidentiary weight as proof of
ownership.[21]
The CA erred, however, in ordering the eviction of PPS from the property that it had held as government
school site for more than 50 years. The evidence on record shows that the Mendozas intended to cede
the property to the City Government of Lipa permanently. In fact, they allowed the city to declare the
property in its name for tax purposes. And when they sought in 1962 to have the bigger lot subdivided
into four, the Mendozas earmarked Lot 4, containing 1,149 square meters, for the City Government of
Lipa. Under the circumstances, it may be assumed that the Mendozas agreed to transfer ownership of the
land to the government, whether to the City Government of Lipa or to the Republic, way back but never
got around to do so and the Republic itself altogether forgot about it. Consequently, the Republic should
be deemed entitled to possession pending the Mendozas formal transfer of ownership to it upon payment
of just compensation.

The Court holds that, where the owner agrees voluntarily to the taking of his property by the government
for public use, he thereby waives his right to the institution of a formal expropriation proceeding covering
such property. Further, as the Court also held in Eusebio v. Luis,[22] the failure for a long time of the
owner to question the lack of expropriation proceedings covering a property that the government had
taken constitutes a waiver of his right to gain back possession. The Mendozas remedy is an action for the
payment of just compensation, not ejectment.

In Republic of the Philippines v. Court of Appeals,[23] the Court affirmed the RTCs power to award just
compensation even in the absence of a proper expropriation proceeding. It held that the RTC can
determine just compensation based on the evidence presented before it in an ordinary civil action for
recovery of possession of property or its value and damages. As to the time when just compensation
should be fixed, it is settled that where property was taken without the benefit of expropriation
proceedings and its owner filed an action for recovery of possession before the commencement of
expropriation proceedings, it is the value of the property at the time of taking that is controlling.[24]

Since the MTCC did not have jurisdiction either to evict the Republic from the land it had taken for public
use or to hear and adjudicate the Mendozas right to just compensation for it, the CA should have ordered
the complaint for unlawful detainer dismissed without prejudice to their filing a proper action for recovery
of such compensation.

WHEREFORE, the Court partially GRANTS the petition, REVERSES the February 26, 2008 decision and the
October 20, 2008 resolution of the Court of Appeals in CA-G.R. 96604, and ORDERS the dismissal of
respondents Primo and Maria Mendozas action for eviction before the Municipal Trial Court in Cities of
Lipa City in Civil Case 0002-99 without prejudice to their filing an action for payment of just compensation
against the Republic of the Philippines or, when appropriate, against the City of Lipa.

SO ORDERED.
EN BANC

[G.R. No. L-7644. November 27, 1956.]

HENRY LITAM, ETC., ET AL., Plaintiffs-Appellants, vs. REMEDIOS R. ESPIRITU, as guardian of the
incompetent MARCOSA RIVERA, and ARMINIO RIVERA, Defendants-Appellees.

[G.R. No. L-7645. November 27, 1956]

IN THE MATTER OF THE INTESTATE OF THE DECEASED RAFAEL LITAM. GREGORIO DY TAM, Petitioner-
Appellant, vs. REMEDIOS R. ESPIRITU, in her capacity as judicial guardian of the incompetent MARCOSA
RIVERA, counter-Petitioner, ARMINIO RIVERA, administrator-Appellee.

DECISION

CONCEPCION, J.:

This is an appeal from a decision of the Court of First Instance of Rizal in the above entitled case, which
were jointly tried.

On May 21, 1952, Gregorio Dy Tam instituted Special Proceeding No. 1537 of said court, entitled “In the
matter of the Intestate Estate of the Deceased Rafael Litam”. The petition therein filed, dated April 24,
1952, states that Petitioner is the son of Rafael Litam, who died in Manila on January 10, 1951; chan
roblesvirtualawlibrarythat the deceased was survived by:chanroblesvirtuallawlibrary

Li Hong Hap 40 years

Li Ho 37 years
Gregorio Dy Tam 33 years

Henry Litam alias Dy Bun Pho 29 years

Beatriz Lee Tam alias Lee Giak Ian 27 years

Elisa Lee Tam alias Lee Giok Bee 25 years

William Litam alias Li Bun Hua 23 years

Luis Litam alias Li Bun Lin 22 years

That the foregoing children of the decedent “by a marriage celebrated in China in 1911 with Sia Khin, now
deceased”; chan roblesvirtualawlibrarythat “after the death of Rafael Litam, Petitioner and his co-heirs
came to know” that the decedent had, during the subsistence of said marriage with Sia Khin, “contracted
in 1922 in the Philippines cralaw another marriage with Marcosa Rivera, Filipino citizen”; chan
roblesvirtualawlibrarythat “the decedent left as his property among others, his one-half (1/2) share valued
at P65,000 in the purported conjugal properties between him and Marcosa Rivera, which cralaw
partnership consisted of the following real property acquired during the marriage between him and
Marcosa Rivera, to wit:chanroblesvirtuallawlibrary

(1) “Three (3) parcels of land covered by Transfer Certificate of Title No. 1228 of
the Registry of Deeds of the province of Pampanga:chanroblesvirtuallawlibrary

(2) “One (1) parcel of land covered by Transfer Certificate of Title No. 26011 of the
Registry of Deeds of the province of Bulacan.”

And that the decedent had left neither a will nor debt. Petitioner prayed, therefore, that, after appropriate
proceedings, letters of administration be issued to Marcosa Rivera, “the surviving spouse of the
decedent”. Soon thereafter, Marcosa Rivera filed a counter- petition:chanroblesvirtuallawlibrary (1)
substantially denying the alleged marriage of the decedent to Sia Khin, as well as the alleged filiation of
the persons named in the petition; chan roblesvirtualawlibrary(2) asserting that the properties described
herein are her paraphernal properties, and that the decedent had left unpaid debts, and certain properties
in Bulan and Casiguran, Sorsogon, and in Virac, Catanduanes, apart from shares of stock in a private
corporation known by the name of Litam Co., Inc.; chan roblesvirtualawlibraryand (3) praying that her
nephew, Arminio Rivera, be appointed administrator of the intestate estate of the deceased.

In due course, the court granted this petition and letters of administration were issued to Arminio Rivera,
who assumed his duties as such, and, later, submitted an inventory of the alleged estate of Rafael Litam.
Inasmuch as said inventory did not include the properties mentioned in the petition, dated April 24, 1952,
of Gregorio Dy Tam, the latter filed, on November 29, 1952, a motion for the removal of Rivera as
administrator of the aforementioned estate. This led to a number of incidents hinging on the question
whether said properties belong in common to the decedent and Marcosa Rivera or to the latter
exclusively.

Meanwhile, Remedios R. Espiritu was appointed, in Special Proceeding No. 1709 of the Court of First
Instance of Rizal, guardian of Marcosa Rivera, who had been declared incompetent. Thereafter, or on April
20, 1953, Gregorio Dy Tam and his alleged brothers and sisters aforementioned, filed the complaint in
Civil Case No. 2071 of the same court, against Remedios R. Espiritu, as guardian of Marcosa Rivera, and
Arminio Rivera. In said complaint, Plaintiffs therein reproduced substantially the allegations made in the
aforementioned petition of Gregorio Dy Tam dated April 24. 1952, except that the properties acquired
“during the existence of marriage” between Rafael Litam and Marcosa Rivera “and/or with their joint
efforts during the time that they lived as husband and wife” were said to be more than those specified in
said petition, namely:chanroblesvirtuallawlibrary

“(1) 3 parcels of land situated in the Municipality of Macabebe, Province of Pampanga, covered by
Transfer Certificate of Title No. 1228 of the Registry of Deeds for the Province of Pampanga, issued on July
29, 1947;

“(2) 2 Parcels of land, together with all buildings and improvements thereon except those expressly noted
in the title as belonging to other persons, situated in the Municipality of Navotas, Province of Rizal,
covered by Transfer Certificate of Title No. 35836 of the Registry of Deeds for the Province of Rizal, issued
on October 4, 1938;

“(3) 1 parcel of land situated in the Municipality of Malabon, Province of Rizal, covered by Transfer
Certificate of Title No. 23248 of the Registry of Deeds for the Province of Rizal, issued on June 12, 1933;

“(4) 1 parcel of land situated in Barrio of Kay-Badia, Municipality of Obando, Province of Bulacan, covered
by Transfer Certificate of Title No. 21809 of the Registry of Deeds for the Province of Bulacan, issued on
May 25, 1939;
“(5) 1 parcel of land (plan psu-93067, swo-16049) situated in Barrio of Quibadia, Municipality of Obando,
Province of Bulacan, covered by Transfer Certificate of Title No. 26011 of the Registry of Deeds for the
Province of Bulacan, issued on April 9, 1943;

“Other properties are located in Bataan province.

“All properties total an assessed value of approximately P150,000.00.”

In said complaint, Plaintiffs prayed that the judgment be rendered:chanroblesvirtuallawlibrary

“(1) declaring the aforesaid properties as belonging to the conjugal partnership or tenancy in common
which existed between the deceased Rafael Litam and the incompetent Marcosa Rivera;

“(2) ordering the Defendants to deliver the aforesaid properties to the administration of the estate of the
deceased Rafael Litam (Rule 75, section 2, Rules of Court);

“(3) ordering the said Defendants further to render an accounting of the fruits they collected from the
aforesaid properties and to deliver the same to the administration of the estate of the deceased Rafael
Litam;

“(4) ordering the said Defendants to pay the administration of the estate of the deceased Rafael Litam
damages in double the value of the fruits mentioned in the preceding paragraph which they embezzled;
chan roblesvirtualawlibraryand

“(5) ordering the Defendants to pay the costs. “The Plaintiffs further pray for such other remedy as the
Court may deem just and equitable in the premises.”

In her answer to the complaint, Marcosa Rivera reiterated, in effect, the allegations in her counter-
petition, dated July 12, 1952, in Special Proceeding No. 1537, and set up some affirmative and special
defenses, as well as a counter-claim for attorney’s fees and damages in the aggregate sum of P110,000.00.
Owning to the identity of the issue raised in said Civil Case No. 2071 and in the aforementioned incidents
in Special Proceeding No. 1537, both were jointly heard. Later on, the court rendered a decision.

“(1) Dismissing Civil Case No. 2071, with costs against the Plaintiffs;

“(2) Sentencing the Plaintiff in Civil Case No. 2071, under the Defendants’ counterclaim, to pay jointly and
severally each of the Defendants the sum of P5,000.00 as actual damages and P25,000.00 as moral
damages;

“(3) Declaring that the properties in question, namely:chanroblesvirtuallawlibrary the fishponds,

consisting of three parcels, situated in Macabebe, Pampanga, with Transfer certificate of Title No. 1228
of the land records of Pampanga, one-half undivided portion of the fishponds, consisting of two parcels,
situated in Navotas, Rizal, covered by Transfer Certificate of Title No. 35836, the parcel of land with the
improvements thereon situated in Malabon, Rizal, covered by Transfer Certificate of Title No. 23248, both
of the land records of Rizal, and the fishponds, consisting of two parcels, situated in Obando, Bulacan,
covered by Transfer Certificates of Title Nos. 21809 and 26011, both of the land records of Bulacan, are
the exclusive, separate and paraphernal properties of Marcosa Rivera; chan roblesvirtualawlibraryand

“(4) Declaring that the Plaintiffs in Civil Case No. 2071 (who are the same persons alleged to be children
of Rafael Litam in the petition, dated April 24, 1952, filed by the Petitioner in Sp. Proc. No. 1537) are not
the children of the deceased Rafael Litam, and that his only heir is his surviving wife, Marcosa Rivera.”

The two (2) Cases are now before us on appeal taken by the Petitioner in Special Proceeding No. 1537 and
the Plaintiffs in Civil Case No. 2071. The issues for determination are:chanroblesvirtuallawlibrary (1) Are
Appellants the legitimate children of Rafael Litam? (2) Is Marcosa Rivera the exclusive owner of the
properties in question, or do the same constitute a common property of her and the decedent?

The first issue hinges on whether Rafael Litam and Sia Khin were married in 1911, and whether Rafael
Litam is the father of Appellants herein. In this connection, the lower court had the following to
say:chanroblesvirtuallawlibrary

“ cralaw the evidence weikhs very heavily in favor of the theory of the Defendants in Civil Case No. 2071
to the effect that the said deceased Rafael Litam was not married to Sia Khin and that Plaintiffs, are not
the children of the said decedent. The Plaintiffs in Civil Case No. 2071 and the Petitioner in Sp. Proc. No.
1537 have utterly failed to prove their alleged status as children of Rafael Litam by a marriage with Sia
Khin.
“It appears from the evidence presented by the Defendants in civil Case No. 2071 and the administrator
and the counter-Petitioner in Sp. Proc. No. 1537 that there was no such marriage between the deceased
Rafael Litam and Sia Khin and that the Plaintiffs named in Civil Case No. 2071 are not children of said
deceased. The various official and public documents executed by Rafael Litam himself convincingly show
that he had not contracted any marriage with any person other than Marcosa Rivera, and that he had no
child. In the marriage certificate, (Exhibit 55) it was clearly stated that he was single when he married
Marcosa Rivera on June 10, 1922. In the sworn application for alien certificate of registration dated July
7, 1950 (Exhibit 1), Rafael Litam unequivocably declared under oath that he had no child. In the several
other documents executed by him and presented in evidence, (Exhibits 19, 21, 22, 23, 46 and 46-A) Rafael
Litam had consistently referred to Marcosa Rivera alone as his wife; chan roblesvirtualawlibraryhe had
never mentioned of Sia Khin as his wife, or of his alleged children.

The witnesses presented by the Defendants in Civil Case No. 2071 and the administrator and counter
Petitioner in Sp. Proc. No. 1537 positively testified to the effect that they know that Rafael Litam did not
have any child, nor was he married with Sia Khin. An impartial and disinterested witness, Felipe Cruz,
likewise testified that he has known Rafael Litam even before his marriage with Marcosa Rivera and that
said Rafael Litam did not have any child.

“On the other hand, the Plaintiffs in Civil Case No. 2071 and the Petitioner in Sp. Proc. No. 1537 presented
in support of their theory the testimony of their lone witness, Luis Litam, and certain documentary
evidence. It is noteworthy that the said Plaintiffs and said Petitioner did not present in evidence the
marriage certificate of Rafael Litam and Sia Khin, which in the opinion of the Court, is the competent and
best evidence of the alleged marriage between them. No explanation has been given for the non-
presentation of said marriage certificate, nor has there been any showing of its loss. Neither have said
Plaintiffs and said Petitioner presented any competent secondary evidence of the supposed marriage.

“The testimony of the lone witness, Luis Litam, cannot be given any credence and value at all. His
testimony is mostly hearsay, as according to him, he was merely informed by Rafael Litam of the latter’s
supposed marriage with Sia Khin. His testimony is uncorroborated. The court noticed that the said witness
was only 22 years old when he testified, and it appears in the petition filed by the Petitioner in Sp. Proc.
No. 1537 that said witness is the youngest of all the alleged eight children of Rafael Litam. The Court is at
a loss to understand why one or some of the older alleged children of Rafael Litam were not presented as
witnesses in view of the unreliable testimony of Luis Litam, and considering that older persons are better
qualified to testify on the matters sought to be proved which allegedly happened a long time ago.

“The birth certificate presented by the Plaintiff in Civil Case No. 2071 and Petitioner in Sp. Proc. No. 1537
cannot be given even little consideration, because the name of the father of the children appearing
therein is not Rafael Litam, but different persons. It is very significant to note that the names of the father
of the persons appearing in said birth certificates are Dy Tham, Li Tam, Lee Tham, Rafael Dy Tam, and that
said persons were born in different places, some in Amoy, China, another Fukien, China, and the other in
Limtao, China. It also appears in said birth certificates that the children’s mothers named therein are
different, some being Sia Khim, others Sia Quien, the other Sia Khun, and still another Sia Kian. These
documents do not establish the identity of the deceased Rafael Litam and the persons named therein as
father. Besides, it does not appear in the said certificates of birth that Rafael Litam had in any manner
intervened in the preparation and filing thereof.

“The other documentary evidence presented by the said Plaintiffs and Petitioner are entirely immaterial
and highly insufficient to prove the alleged marriage between the deceased Rafael Litam and Sia Khin and
the alleged statue of the Plaintiffs as children of said decedent.

“It is, therefore, the finding of this Court that the Plaintiffs named in Civil Case No. 2071 are not heirs of
the said decedent, his only heir being his surviving wife, Marcosa Rivera.” (Emphasis ours.)

The findings of fact thus made in the decision appealed from are borne out by the records and the
conclusion drawn from said facts is, to our mind, substantially correct.

Appellants’ evidence on this point consists of the testimony of Appellant Li Bun Lin, who said that he is,
also known as Luis Litam; chan roblesvirtualawlibrarythat his co-Appellants are his brothers and sisters;
chan roblesvirtualawlibrarythat their parents are the decedent and Sia Khin, who were married in China
in 1911; chan roblesvirtualawlibraryand that Sia Khin died in Manila during the Japanese occupation. He
likewise, identified several pictures, marked Exhibits I to S, which were claimed to be family portraits, but
the lower court rejected their admission in evidence. Although we agree with herein Appellants that this
was an error, it is clear to us that said pictures and the testimony of Luis Litam, as well as the other
evidence adverted to in the above-quoted portion of the decision appealed from, are far from sufficient
to outweigh, or even offset, the evidence in favor of the Appellees.

It should be noted that the decedent had admittedly married Marcosa Rivera in 1922. In the very petition
of Appellant Gregorio Dy Tam, in Special Proceeding No. 1537, dated April 24, 1952, he alleged that
Marcosa Rivera is “the surviving spouse of the decedent”. In their complaint in Civil Case No. 2071,
Appellants specifically admitted and averred “the existence of the marriage between said Rafael Litam
and Marcosa Rivera” — which would have been void ab initio, and, hence, inexistent legally, if Appellants’
pretense were true or they believed it to be so — and that they had “lived as husband and wife”. Again,
although Gregorio Dy Tam, asserted, in his aforementioned petition, that he and his co-heirs “came to
know” about the marriage of the decedent and Marcosa Rivera “after the death of Rafael Litam”, the very
testimony of Li Bun Lin, as witness for the Appellants, show, beyond doubt, that said Appellants knew,
during the lifetime of Rafael Litam that he and Marcosa Rivera were living in Malabon, Rizal, openly and
publicly, as husband and wife, and regarded her as his lawful wife. Indeed, in the course of his testimony,
said Li Bun Lin alluded to her as his “mother”. In other words, aside from the circumstance that the
wedding and marital life of Marcosa Rivera and Rafael Litam is undisputed, it is, also, an established fact
that they had the general reputation of being legally married and were so regarded by the community
and by Appellants herein, during the lifetime of Rafael Litam.

Upon the other hand, Appellants maintain, in effect, that Rafael Litam was guilty of the crime of bigamy;
chan roblesvirtualawlibrarythat he had, likewise, willfully and maliciously falsified public and official
documents; chan roblesvirtualawlibraryand that, although Appellants and Sia Khin were living in Manila
and Marcosa Rivera — whom Appellants knew — resided only a few kilometers away, in Malabon, Rizal
where Rafael Litam returned daily, after attending to his business in Manila, the decedent had succeeded,
for about thirty (30) years, in keeping each party in complete ignorance of the nature of his alleged
relations with the other. Apart from the highly improbable nature of the last part of Appellants’ pretense,
it is obvious that the same cannot be sustained unless the evidence in support thereof is of the strongest
possible kind, not only because it entails the commission by Rafael Litam of grave criminal offenses which
are derogatory to his honor, but, also, because death has sealed his lips, thus depriving him of the most
effective means of defense. The proof for Appellants herein does not satisfy such requirement.

As regards the title to the properties in dispute, the evidence thereon was analyzed by the lower court in
the following language:chanroblesvirtuallawlibrary

“It has been established by the evidence that the properties in question were bought by Marcosa Rivera
with her separate and exclusive money. The fishponds situated in Obando, Bulacan, covered by Transfer
Certificate of Title Nos. 21809 and 26011, the one-half (1/2) undivided portion of the fishponds situated
in Navotas, Rizal with Transfer Certificate of Title No. 35836, and the property situated in Hulong-Duhat,
Malabon, Rizal, with Transfer Certificate of Title No. 23248 were all purchased by Marcosa Rivera with the
money she earned and accumulated while she was still single; chan roblesvirtualawlibrarywhile the
fishponds situated in Macabebe, Pampanga with Transfer Certificate of Title No. 1228 were purchased by
her with the money she inherited from her late sister, Rafaela Rivera and with the money she received
from the proceeds of the sale of the pieces of jewelry she inherited from her father Eduardo Rivera and
her sister Rafaela Rivera. The properties in question, having been bought by Marcosa Rivera, although
during her marriage with Rafael Litam, with her exclusive and separate money, said properties are
undeniably her paraphernal properties. (Art. 1396, Spanish Civil Code, which is the same as Art. 148 of the
Civil Code of the Phil.)

“Great importance should be given to the documentary evidence, vis:chanroblesvirtuallawlibrary Exhibits

21, 22, 23, 19, 46 and 46-A, presented by the Defendants, in Civil Case No. 2071 and the administrator
and counter- Petitioner in Sp. Proc. No. 1537, which prove beyond peradventure of any doubt that the
properties in question are the paraphernal properties of Marcosa Rivera. In Exhibit 21, Rafael Litam
unequivocably declared under his oath that the money paid by Marcosa Rivera for the fishponds in
Obando, Bulacan was her exclusive and separate money which was earned by her while she was still single.
In Exhibits 22 and 23, both dated June 16, 1947, same Rafael Litam, also under oath, acknowledge the fact
that the sums of P13,000.00 and P10,000.00 loaned by Marcosa Rivera to the spouses Catalino Pascual
and Juliana Pascual, and to Juliana Pascual, respectively, are the separate and exclusive money of Marcosa
Rivera, in which money Rafael Litam had no interest whatsoever. In Exhibit 19, same Rafael Litam
acknowledged the fact that he had obtained, before the outbreak of the second world war, from Marcosa
Rivera the sum of P135,000.00 which belongs exclusively to the latter, and that after the liberation, or
more specifically, on January 4, 1946, he stole from Marcosa Rivera the further sum of P62,000.00, also
belonging exclusively to the latter, which amounts, totalling P197,000.00, exclusive of interests, have not,
according to the evidence, been paid to her up to the present. In Exhibits 46 and 46-A, it was
acknowledged by Rafael Litam that he had not given any money to his wife, Marcosa Rivera, and that they
have actually adopted a system of separation of property, each of them not having any interest or
participation whatsoever in the property of the other. These declarations and admission of fact made by
Rafael Litam against his interest are binding upon him, his heirs and successors in interests and third
persons as well. (Secs. 7 & 29, Rule 123, Rules of Court).

“The finding of this Court that the properties in question are paraphernal properties of Marcosa Rivera,
having been bought by her with her separate and exclusive money, is further strengthened by the fact
that, as it is clearly disclosed by the evidence when Marcosa Rivera married Rafael Litam in 1922, she was
already rich, she having already earned and saved money as ‘consignataria’ while she was still single. It
also appears that she was born of a rich family, her father, Eduardo Rivera, being the owner of fishponds,
commercial and residential lands and buildings, (Exhibits 5 to 18, inclusive), with an assessed value of
around P150,000.00 (Exhibits 25 and 42, inclusive), now worth approximately a million pesos, and most
of which properties as may be seen from the certificates of title were acquired by him way back in the
years 1916 and 1919. When Eduardo Rivera died on February 5, 1942, his cash and jewelry were inherited
by his eldest daughter, Rafaela Rivera, and when the latter died single on July 2, 1943, Marcosa Rivera
inherited her cash amounting to P150,000.00, Philippine currency, and and her pieces of jewelry. It is with
this amount and with the proceeds of the sale of some of said pieces of jewelry that Marcosa Rivera
purchased the fishponds in question, situated in Macabebe, Pampanga.

“On the other hand, it appears from the evidence that when Rafael Litam was on June 10, 1922, married
to Marcosa Rivera, he was poor. He had to borrow from Marcosa Rivera, the sum of P135,000.00
belonging exclusively to her before the outbreak of the war, and to steal from her further sum of
P62,000.00 after the liberation (Exhibit 10). The said amounts totalling P197,000.00, exclusive of the
stipulated interests, according to the evidence, have not been paid to Marcosa Rivera up to the present.
Rafael Litam did not contribute any amount of money or labor to the properties in question, as he and
Marcosa Rivera maintained an absolute separation of property (Exhibits 46 and 46-A). Besides, during his
lifetime he used to go his office in Manila everyday.

“Another circumstance which clearly proves that the properties in question belong exclusively to Marcosa
Rivera is the established fact that before she became incompetent sometime in the early part of the year,
1953, she had been administering said properties, to the exclusion of Rafael Litam. In fact, as may be seen
from the very documentary evidence (Exhibit ‘EE’, same as Nxh. 50) presented by the Plaintiffs in Civil
Case No. 2071 themselves and Petitioner in Sp. Proc. No. 1537, she alone leased the properties in
question, situated in Macabebe, Pampanga, and the corresponding lease contract, dated July 13, 1948
was signed by her as lessor and by Rafael Suarez, Jr. as lessees. Furthermore, the properties in question
have been declared in the name of Marcosa Rivera alone, and she alone pays the real estate taxes due
thereon. (Exhibits 43, 44 & 45.)

“Further strong proofs that the properties in question are the paraphernal properties of Marcosa Rivera,
are the very Torrens Titles covering said properties. All the said properties are registered in the name of
‘Marcosa Rivera, married to Rafael Litam.’ This circumstance indicates that the properties in question
belong to the registered owner, Marcosa Rivera, as her paraphernal properties, for if they were conjugal,
the titles covering the same should have been issued in the names of Rafael Litam and Marcosa Rivera.
The words ‘married to Rafael Litam’ written after the name of Marcosa Rivera, in each of the above
mentioned titles are merely descriptive of the civil status of Marcosa Rivera, the registered owner of the
properties covered by said titles.

“On the other hand, the evidence presented by the Plaintiffs in Civil Case No. 2071 and Petitioner in Sp.
Proc. No. 1537 in support of their contention that the properties in question are conjugal is, in the mind
of the Court, very weak, unreliable, and mostly incompetent, and cannot overcome the clear, convincing
and almost conclusive proofs presented by the opposite party. Scant or no consideration at all could be
given by the Court to the immaterial, incompetent and unbelievable testimonies of the witnesses
presented by the said Plaintiffs and Petitioners. The disputable presumption of law that the properties
acquired during the marriage are conjugal properties, upon which legal presumption said Plaintiffs and
Petitioner mainly rely has been decisively overcome by the overwhelming preponderance of evidence
adduced in these cases that the properties in question are the paraphernal properties of Marcosa Rivera.”
(Emphasis ours.)

Appellants’ counsel assail the decision appealed from upon the ground that the lower court had been
partial to the Appellees and had not accorded to the Appellants a fair and just hearing.

As above pointed out, His Honor the trial Judge could have been, and should have been, more liberal in
the reception of evidence. Appellants’ witnesses (Li Bun Lin, Dominador Gadi, Benigno Musni and Rafael
B. Suarez) should have been allowed to testify on the alleged title of Rafael Litam to certain properties
and on his alleged reasons for the language used in the public and official documents relied upon by the
Appellees. However, it is apparent to us that said evidence cannot affect the decision in these cases.

The evidenciary value of the testimony of said witnesses would have depended mainly upon their
individual appraisal of certain facts, upon their respective inferences therefrom and their biases or view
points, and upon a number of other factors affecting their credibility. At best, said testimony could not
possibly prevail over the repeated admissions made by the decedent against his own interest in Exhibits
19, 21, 22, 23, 46 and 46-A (adverted to in the abovequoted portion of the decision appealed from), which
admissions are corroborated by the fact that the deceased father of Marcosa Rivera was well to do; chan
roblesvirtualawlibrarythat aside from her share in his estate, she had, likewise, inherited from a sister who
died single and without issue; chan roblesvirtualawlibrarythat the lands in dispute were registered, and
some were, also, leased, in her name, instead of hers and that of the decedent; chan
roblesvirtualawlibraryand that the latter lived in her house in Malabon, Rizal.

Appellants contend that the transactions covered by said Exhibits 19, 21 to 23 and 46 and 46-A, as well as
by the other deeds referred to in the decision appealed from, were caused to be made in the name of
Marcosa Rivera, to the exclusion of her husband, in order to evade the constitutional provision
disqualifying foreigners from the acquisition of private agricultural lands, except by succession. Apart from
being based, solely, upon a surmise, without any evidentiary support, this pretense is refuted by the fact
that said residential property in Hulong-Duhat, Malabon, Rizal, was acquired on April 12, 1933, or prior to
the adoption of our Constitution (see Exhibits Z and AA). Her transactions subsequently thereto, merely
followed, therefore, the pattern of her activities before the drafting of said fundamental law.

This notwithstanding, we do not believe that Appellants should be sentenced to pay damages. The
petition of Gregorio Dy Tam in Special Proceeding No. 1537 and the complaint in Civil Case No. 2071
contain nothing derogatory to the good name or reputation of the herein Appellees. On the contrary, it
may be surmised from said pleadings that Marcosa Rivera had no knowledge of the alleged previous
marriage of the decedent to Sia Khin. Moreover, the records do not show that Appellants have acted in
bad faith.

Likewise, we are of the opinion that the lower court should not have declared, in the decision appealed
from, that Marcosa Rivera is the only heir of the decedent, for such declaration is improper in Civil Case
No. 2071, it being within the exclusive competence of the court in Special Proceeding No. 1537, in which
it is not as yet, in issue, and, will not be, ordinarily, in issue until the presentation of the project of partition.

Wherefore, with the elimination of the award for damages in favor of the herein Appellees, and of said
declaration of heirship, the decision appealed from is hereby affirmed in all other respects, with costs
against the Appellants. It is SO ORDERED.
Republic of the Philippines

SUPREME COURT

Manila

FIRST DIVISION

G.R. No. 184148 June 9, 2014

NORA B. CALALANG-PARULAN and ELVIRA B. CALALANG, Petitioners,

Vs.

ROSARIO CALALANG-GARCIA, LEONORA CALALANG-SABILE, and CARLITO S. CALALANG, Respondents.

DECISION

VILLARAMA, JR., J.:

Before us is a petition for review on certiorari assailing the Decision1 dated December 21, 2007 and
Resolution2 dated July 25, 2008 of the Thirteenth Division of the Court of Appeals (CA) in CA-G.R. CV No.
72531. The CA modified the Decision3 dated July 10, 2001 of the Regional Trial Court (RTC), Branch 21, of
Malolos, Bulacan, in Civil Case No. 370-M-91.

The facts, as culled from the records, follow:

In a Complaint4 for Annulment of Sale and Reconveyance of Property filed with the RTC of Malolos,
Bulacan on June 10, 1991, the respondents Rosario Calalang-Garcia, Leonora Calalang-Sabile, and Carlito
S. Calalang asserted their ownership over a certain parcel of land against the petitioners Nora B. Calalang-
Parulan and Elvira B. Calalang. The said lot with an area of 1,266 square meters and specifically identified
as Lot 1132, Cad. 333, Bigaa Cadastre situated in Brgy. Burol 2nd, Municipality of Balagtas, Province of
Bulacan, was allegedly acquired by the respondents from their mother Encarnacion Silverio, through
succession as the latter’s compulsory heirs.
According to the respondents, their father, Pedro Calalang contracted two marriages during his lifetime.
The first marriage was with their mother Encarnacion Silverio. During the subsistence of this marriage,
their parents acquired the above-mentioned parcel of land from their maternal grandmother Francisca
Silverio. Despite enjoying continuous possession of the land, however, their parents failed to register the
same. On June 7, 1942, the first marriage was dissolved with the death of Encarnacion Silverio.

On November 6, 1967, Pedro Calalang entered into a second marriage with Elvira B. Calalang who then
gave birth to Nora B. Calalang-Parulan and Rolando Calalang. According to the respondents, it was only
during this time that Pedro Calalang filed an application for free patent over the parcel of land with the
Bureau of Lands. Pedro Calalang committed fraud in such application by claiming sole and exclusive
ownership over the land since 1935 and concealing the fact that he had three children with his first spouse.
As a result, on September 22, 1974, the Register of Deeds of Bulacan issued Original Certificate of Title
(OCT) No. P-28715 in favor of Pedro Calalang only.

On February 17, 1984, Pedro Calalang sold the said parcel of land to Nora B. Calalang-Parulan as evidenced
by a Deed of Sale6 executed by both Pedro Calalang and Elvira B. Calalang. Accordingly, the Register of
Deeds of Bulacan cancelled OCT No. P-2871 and issued Transfer Certificate of Title (TCT) No. 283321 in
the name of Nora B. Calalang-Parulan. On December 27, 1989,7 Pedro Calalang died.

The respondents assailed the validity of TCT No. 283321 on two grounds. First, the respondents argued
that the sale of the land was void because Pedro Calalang failed to obtain the consent of the respondents
who were co-owners of the same. As compulsory heirs upon the death of Encarnacion Silverio, the
respondents claimed that they acquired successional rights over the land. Thus, in alienating the land
without their consent, Pedro Calalang allegedly deprived them of their pro indiviso share in the property.
Second, the respondents claimed that the sale was absolutely simulated as Nora B. Calalang-Parulan did
not have the capacity to pay for the consideration stated in the Deed of Sale.

In their Answer,8 the petitioners argued that the parcel of land was acquired during the second marriage
of Pedro Calalang with Elvira B. Calalang. They stressed that OCT No. P-2871 itself stated that it was issued
in the name of “Pedro Calalang, married to Elvira Berba [Calalang].” Thus, the property belonged to the
conjugal partnership of the spouses Pedro Calalang and Elvira B. Calalang. The petitioners likewise denied
the allegation that the sale of the land was absolutely simulated as Nora B. Calalang-Parulan was gainfully
employed in Spain at the time of the sale. Moreover, they alleged that the respondents did not have a
valid cause of action against them and that their cause of action, if any, was already barred by laches,
estoppel and prescription. By way of counterclaim, the petitioners also sought the payment to them of
moral and exemplary damages plus costs of suit for the filing of the clearly unfounded suit.

On July 10, 2001, the trial court rendered decision in favor of the respondents. The dispositive portion of
the RTC decision reads as follows:
WHEREFORE, judgment is hereby rendered in favor of the plaintiffs and against the defendants in the
following manner:

1. Ordering the defendants to reconvey in favor of the plaintiffs, their rightful share to three-fourth
(3/4) of one-half (1/2) or a total of 474.75 square meters at 158.25 square meters for each of the
three plaintiffs, namely: Rosario, Leonora, and Juanito all surname[d] Calalang, of the real
property covered by TCT No. 283321 of the Registry of Deeds of Bulacan corresponding to their
shares in the conjugal estate of the late Encarnacion S. Calalang [sic];

2. Ordering defendants to pay plaintiffs the amount of ₱50,000.00 for moral damages; ₱50,000.00
for attorney’s fees and another ₱50,000.00 for litigation expenses.

3. Dismissing the defendants’ counterclaims.

With costs against the defendants.

SO ORDERED.9

The trial court declared that the parcel of land was jointly acquired by the spouses Pedro Calalang and
Encarnacion Silverio from the parents of the latter. Thus, it was part of the conjugal property of the first
marriage of Pedro Calalang. When this marriage was dissolved upon the death of Encarnacion Silverio on
June 7, 1942,the corresponding shares to the disputed property were acquired by the heirs of the
decedent according to the laws of succession. In particular, the trial court allocated half of the disputed
property to Pedro Calalang as his share in the conjugal partnership and allocated the other half to the
three respondents and Pedro Calalang to be divided equally among them. The trial court then ordered all
of Pedro’s share to be given to Nora B. Calalang-Parulan on account of the sale. The trial court also ruled
that because the application for free patent filed by Pedro Calalang was attended by fraud and
misrepresentation, Pedro Calalang should be considered as a trustee of an implied trust.

Aggrieved by the adverse ruling, the petitioners appealed the case to the CA which rendered the assailed
Decision on December 21, 2007. The dispositive portion of the CA decision reads,
WHEREFORE, in light of the foregoing premises, the Decision dated July 10, 2001of the Regional Trial Court
of Malolos, Bulacan is hereby MODIFIED to read as follows:

“WHEREFORE, judgment is hereby rendered in favor of the plaintiffs, and against the defendants in the
following manner:

1. Ordering the defendants to reconvey in favor of the plaintiffs, their rightful share to the property
owned by their common father Pedro Calalang, equivalent to one half(1/2) portion of the whole
area or 633 square meters to be divided equally by the three plaintiffs, namely:

Rosario, Leonora and Carlito, all surnamed Calalang, each getting an area of 211 square meters of the
property covered by TCT No. 2883321 of the Registry of Deeds of Bulacan corresponding to their shares
in the property of their late father Pedro Calalang;

2. Ordering defendants to pay plaintiffs the amount of ₱50,000.00 for moral damages; ₱50,000.00
for attorney’s fees and another ₱50,000.00 for litigation expenses.

3. Dismissing the defendants’ counterclaims.

With costs against the defendants.

SO ORDERED.

SO ORDERED.10

The CA reversed the factual findings of the trial court and held that Pedro Calalang was the sole and
exclusive owner of the subject parcel of land. Firstly, it held that there was insufficient evidence to prove
that the disputed property was indeed jointly acquired from the parents of Encarnacion Silverio during
the first marriage. Secondly, the CA upheld the indefeasibility of OCT No. P-2871. It held that although the
free patent was issued in the name of “Pedro Calalang, married to Elvira Berba [Calalang]” this phrase was
merely descriptive of the civil status of Pedro Calalang at the time of the registration of the disputed
property. Thus, contrary to the ruling of the trial court, upon the death of Encarnacion Silverio on June 7,
1942, the respondents did not acquire any successional rights to the parcel of land which was exclusively
owned by Pedro Calalang. However, applying the rules of succession, Pedro’s heirs namely, Rosario
Calalang-Garcia, Leonora Calalang-Sabile, Carlito Calalang, Nora B. Calalang-Parulan, Elvira B. Calalang,
and Rolando Calalang, succeeded Pedro to the land in equal shares upon his death. Thus, the CA ordered
the petitioners to reconvey in favor of the respondents their rightful shares to the land. The CA ruled that
the sale by Pedro Calalang to Nora B. Calalang-Parulan was fraudulent and fictitious as the vendee was in
bad faith and the respondents were unlawfully deprived of their pro indiviso shares over the disputed
property. As regards the issue of prescription, the CA ruled that the prescriptive period for reconveyance
of fraudulently registered real property is ten years. Since the property was registered in the name of
Nora in1984 and the action for reconveyance was filed in 1991, the action has not yet prescribed.

On January 23, 2008, petitioners filed their Motion for Reconsideration. The CA, however, denied their
motion in its Resolution dated July 25, 2008.

Hence, this petition raising the sole issue:

Whether or not the court a quo gravely erred in rendering its December 21, 2007 Decision modifying the
July 10, 2001 Decision of the trial court, and in issuing its July 25, 2008 Resolution denying petitioners’
Motion for Reconsideration dated January 23, 2008.11

Essentially, the only issue in this case is whether Pedro Calalang was the exclusive owner of the disputed
property prior to its transfer to his daughter Nora B. Calalang-Parulan.

The petitioners argue that the disputed property belonged to the conjugal partnership of the second
marriage of Pedro Calalang with Elvira B. Calalang as evidenced by OCT No. P-2871 which was issued to
Pedro Calalang during the subsistence of his marriage to Elvira B. Calalang. On the other hand, the
respondents claim that the disputed property was transferred by their maternal grandmother, Francisca
Silverio, to their parents, Pedro Calalang and Encarnacion Silverio, during the latter’s marriage. Thus, the
respondents argue that it belonged to the conjugal partnership of the first marriage of Pedro Calalang
with Encarnacion Silverio.

The petition is meritorious.

Preliminarily, we note that the resolution of the issue in this case requires a reevaluation of the probative
value of the evidence presented by the parties in order to trace the title of the disputed property. What
is involved is indeed a question of fact which is generally beyond the jurisdiction of this Court to resolve
in a petition for review on certiorari.12 However, a recognized exception to the rule is when the RTC and
CA have conflicting findings of fact as in this case.13 Here, while the trial court ruled that the disputed
property belonged to the conjugal partnership of the first marriage of Pedro Calalang with Encarnacion
Silverio, the court a quo declared that the evidence proved the sole and exclusive ownership of the
disputed property of Pedro Calalang.

We have carefully reviewed the records of this case and sustain the finding of the CA that Pedro Calalang
is the sole and exclusive owner of the disputed property.

The trial court ruled that the respondents were able to establish that Lot 1132, Cad. 333 originated from
the parents of Encarnacion, and therefore said property “either became property of Encarnacion in her
own right or jointly with her husband Pedro Calalang in 1936.” In so ruling, the trial court relied on the
testimony of Rosario Calalang-Garcia that her parents built a nipa house on the subject lot and lived there
before and after World War II. The trial court further noted that Rosario’s testimony was corroborated by
her cousin and adjacent neighbor Manolo Calalang.14

However, as correctly pointed out by the CA, a close perusal of the records of this case would show that
the records are bereft of any concrete proof to show that the subject property indeed belonged to
respondents’ maternal grandparents. The evidence respondents adduced merely consisted of testimonial
evidence such as the declaration of Rosario Calalang-Garcia that they have been staying on the property
as far as she can remember and that the property was acquired by her parents through purchase from
her maternal grandparents. However, she was unable to produce any document to evidence the said sale,
nor was she able to present any documentary evidence such as the tax declaration issued in the name of
either of her parents. Moreover, we note that the free patent was issued solely in the name of Pedro
Calalang and that it was issued more than 30 years after the death of Encarnacion and the dissolution of
the conjugal partnership of gains of the first marriage. Thus, we cannot subscribe to respondents’
submission that the subject property originally belonged to the parents of Encarnacion and was acquired
by Pedro Calalang and Encarnacion.

We likewise cannot sustain the argument of the petitioners that the disputed property belongs to the
conjugal partnership of the second marriage of Pedro Calalang with Elvira B. Calalang on the ground that
the title was issued in the name of “Pedro Calalang, married to Elvira Berba [Calalang].”

The contents of a certificate of title are enumerated by Section 45 of Presidential Decree No. 1529,
otherwise known as the Property Registration Decree:

SEC. 45. Statement of personal circumstances in the certificate. – Every certificate of title shall set forth
the full names of all persons whose interests make up the full ownership in the whole land, including their
civil status, and the names of their respective spouses, if married, as well as their citizenship, residence
and postal address. If the property covered belongs to the conjugal partnership, it shall be issued in the
names of both spouses.1âwphi1

A plain reading of the above provision would clearly reveal that the phrase “Pedro Calalang, married to
Elvira Berba [Calalang]” merely describes the civil status and identifies the spouse of the registered owner
Pedro Calalang. Evidently, this does not mean that the property is conjugal. In Litam v. Rivera,15 we
declared:

Further strong proofs that the properties in question are the paraphernal properties of Marcosa Rivera,
are the very Torrens Titles covering said properties. All the said properties are registered in the name of
“Marcosa Rivera, married to Rafael Litam.” This circumstance indicates that the properties in question
belong to the registered owner, Marcosa Rivera, as her paraphernal properties, for if they were conjugal,
the titles covering the same should have been issued in the names of Rafael Litam and Marcosa Rivera.
The words “married to Rafael Litam” written after the name of Marcosa Rivera, in each of the above
mentioned titles are merely descriptive of the civil status of Marcosa Rivera, the registered owner of the
properties covered by said titles.

It must likewise be noted that in his application for free patent,16 applicant Pedro Calalang averred that
the land was first occupied and cultivated by him since 1935 and that he had planted mango trees, coconut
plants, caimito trees, banana plants and seasonal crops and built his house on the subject lot. But he
applied for free patent only in 1974 and was issued a free patent while already married to Elvira B.
Calalang. Thus, having possessed the subject land in the manner and for the period required by law after
the dissolution of the first marriage and before the second marriage, the subject property ipso jure
became private property and formed part of Pedro Calalang’s exclusive property.17 It was therefore
excluded from the conjugal partnership of gains of the second marriage.18

As the sole and exclusive owner, Pedro Calalang had the right to convey his property in favor of Nora B.
Calalang-Parulan by executing a Deed of Sale on February 17, 1984. The CA therefore erred in ruling that
Pedro Calalang deprived his heirs of their respective shares over the disputed property when he alienated
the same.

It is hornbook doctrine that successional rights are vested only at the time of death. Article 777 of the
New Civil Code provides that “[t]he rights to the succession are transmitted from the moment of the death
of the decedent.” In Butte v. Manuel Uy and Sons, Inc.,19 we proclaimed the fundamental tenets of
succession:

The principle of transmission as of the time of the predecessor’s death is basic in our Civil Code, and is
supported by other related articles. Thus, the capacity of the heir is determined as of the time the
decedent died (Art. 1034); the legitime is to be computed as of the same moment (Art. 908), and so is the
in officiousness of the donation inter vivas (Art. 771). Similarly, the legacies of credit and remission are
valid only in the amount due and outstanding at the death of the testator (Art. 935), and the fruits accruing
after that instant are deemed to pertain to the legatee (Art. 948).

Thus, it is only upon the death of Pedro Calalang on December 27, 1989 that his heirs acquired their
respective inheritances, entitling them to their pro indiviso shares to his whole estate. At the time of the
sale of the disputed property, the rights to the succession were not yet bestowed upon the heirs of Pedro
Calalang. And absent clear and convincing evidence that the sale was fraudulent or not duly supported by
valuable consideration (in effect an in officious donation inter vivas), the respondents have no right to
question the sale of the disputed property on the ground that their father deprived them of their
respective shares. Well to remember, fraud must be established by clear and convincing evidence. Mere
preponderance of evidence is not even adequate to prove fraud.20 The Complaint for Annulment of Sale
and Reconveyance of Property must therefore be dismissed.

WHEREFORE, the petition for review on certiorari is GRANTED. The Decision dated December 21, 2007
and Resolution dated July 25, 2008 of the Thirteenth Division of the Court of Appeals in CA-G.R. CV No.
72531 are REVERSED and SET ASIDE. Civil Case No. 370-M-91, or the Complaint for Annulment of Sale and
Reconveyance of Property filed by the respondents with the Regional Trial Court, Branch 21 of Malolos,
Bulacan, on June 10, 1991, is hereby DISMISSED for lack of merit.

No pronouncement as to costs.

SO ORDERED.

Republic of the Philippines

SUPREME COURT

Manila

FIRST DIVISION

G.R. No. 159310 February 24, 2009

CAMILO F. BORROMEO, Petitioner,

Vs.

ANTONIETTA O. DESCALLAR, Respondent.

DECISION

PUNO, C.J.:

What are the rights of an alien (and his successor-in-interest) who acquired real properties in the country
as against his former Filipina girlfriend in whose sole name the properties were registered under the
Torrens system?

The facts are as follows:

Wilhelm Jambrich, an Austrian, arrived in the Philippines in 1983 after he was assigned by his employer,
Simmering-Graz Panker A.G., an Austrian company, to work at a project in Mindoro. In 1984, he
transferred to Cebu and worked at the Naga II Project of the National Power Corporation. There, he met
respondent Antonietta Opalla-Descallar, a separated mother of two boys who was working as a waitress
at St. Moritz Hotel. Jambrich befriended respondent and asked her to tutor him in English. In dire need of
additional income to support her children, respondent agreed. The tutorials were held in Antonietta’s
residence at a squatters’ area in Gorordo Avenue.

Jambrich and respondent fell in love and decided to live together in a rented house in Hernan Cortes,
Mandaue City. Later, they transferred to their own house and lots at Agro-Macro Subdivision, Cabancalan,
Mandaue City. In the Contracts to Sell dated November 18, 19851 and March 10, 19862 covering the
properties, Jambrich and respondent were referred to as the buyers. A Deed of Absolute Sale dated
November 16, 19873 was likewise issued in their favor. However, when the Deed of Absolute Sale was
presented for registration before the Register of Deeds, registration was refused on the ground that
Jambrich was an alien and could not acquire alienable lands of the public domain. Consequently,
Jambrich’s name was erased from the document. But it could be noted that his signature remained on the
left hand margin of page 1, beside respondent’s signature as buyer on page 3, and at the bottom of page
4 which is the last page. Transfer Certificate of Title (TCT) Nos. 24790, 24791 and 24792 over the properties
were issued in respondent’s name alone.
Jambrich also formally adopted respondent’s two sons in Sp. Proc. No. 39-MAN,4 and per Decision of the
Regional Trial Court of Mandaue City dated May 5, 1988.5

However, the idyll lasted only until April 1991. By then, respondent found a new boyfriend while Jambrich
began to live with another woman in Danao City. Jambrich supported respondent’s sons for only two
months after the break up.

Jambrich met petitioner Camilo F. Borromeo sometime in 1986. Petitioner was engaged in the real estate
business. He also built and repaired speedboats as a hobby. In 1989, Jambrich purchased an engine and
some accessories for his boat from petitioner, for which he became indebted to the latter for about
₱150,000.00. To pay for his debt, he sold his rights and interests in the Agro-Macro properties to petitioner
for ₱250,000, as evidenced by a “Deed of Absolute Sale/Assignment.”6 On July 26, 1991, when petitioner
sought to register the deed of assignment, he discovered that titles to the three lots have been transferred
in the name of respondent, and that the subject property has already been mortgaged.

On August 2, 1991, petitioner filed a complaint against respondent for recovery of real property before
the Regional Trial Court of Mandaue City. Petitioner alleged that the Contracts to Sell dated November
18, 1985 and March 10, 1986 and the Deed of Absolute Sale dated November 16, 1987 over the properties
which identified both Jambrich and respondent as buyers do not reflect the true agreement of the parties
since respondent did not pay a single centavo of the purchase price and was not in fact a buyer; that it
was Jambrich alone who paid for the properties using his exclusive funds; that Jambrich was the real and
absolute owner of the properties; and, that petitioner acquired absolute ownership by virtue of the Deed
of Absolute Sale/Assignment dated July 11, 1991 which Jambrich executed in his favor.

In her Answer, respondent belied the allegation that she did not pay a single centavo of the purchase
price. On the contrary, she claimed that she “solely and exclusively used her own personal funds to defray
and pay for the purchase price of the subject lots in question,” and that Jambrich, being an alien, was
prohibited to acquire or own real property in the Philippines.

At the trial, respondent presented evidence showing her alleged financial capacity to buy the disputed
property with money from a supposed copra business. Petitioner, in turn, presented Jambrich as his
witness and documentary evidence showing the substantial salaries which Jambrich received while still
employed by the Austrian company, Simmering-Graz Panker A.G.

In its decision, the court a quo found—

Evidence on hand clearly show that at the time of the purchase and acquisition of [the] properties under
litigation that Wilhelm Jambrich was still working and earning much. This fact of Jambrich earning much
is not only supported by documentary evidence but also by the admission made by the defendant
Antoniet[t]a Opalla. So that, Jambrich’s financial capacity to acquire and purchase the properties . . . is
not disputed.7

Xxx

On the other hand, evidence . . . clearly show that before defendant met Jambrich sometime in the latter
part of 1984, she was only working as a waitress at the St. Moritz Hotel with an income of ₱1,000.00 a
month and was . . . renting and living only in . . . [a] room at . . . [a] squatter area at Gorordo Ave., Cebu
City; that Jambrich took pity of her and the situation of her children that he offered her a better life which
she readily accepted. In fact, this miserable financial situation of hers and her two children . . . are all
stated and reflected in the Child Study Report dated April 20, 1983 (Exhs. “G” and “G-1”) which facts she
supplied to the Social Worker who prepared the same when she was personally interviewed by her in
connection with the adoption of her two children by Wilhelm Jambrich. So that, if such facts were not true
because these are now denied by her . . . and if it was also true that during this time she was already
earning as much as ₱8,000.00 to ₱9,000.00 as profit per month from her copra business, it would be highly
unbelievable and impossible for her to be living only in such a miserable condition since it is the
observation of this Court that she is not only an extravagant but also an expensive person and not thrifty
as she wanted to impress this Court in order to have a big saving as clearly shown by her actuation when
she was already cohabiting and living with Jambrich that according to her . . . the allowance given . . . by
him in the amount of $500.00 a month is not enough to maintain the education and maintenance of her
children.8

This being the case, it is highly improbable and impossible that she could acquire the properties under
litigation or could contribute any amount for their acquisition which according to her is worth more than
₱700,000.00 when while she was working as [a] waitress at St. Moritz Hotel earning ₱1,000.00 a month
as salary and tips of more or less ₱2,000.00 she could not even provide [for] the daily needs of her family
so much so that it is safe to conclude that she was really in financial distress when she met and accepted
the offer of Jambrich to come and live with him because that was a big financial opportunity for her and
her children who were already abandoned by her husband.9

Xxx

The only probable and possible reason why her name appeared and was included in [the contracts to sell
dated November 18, 1985 and March 10, 1986 and finally, the deed of absolute sale dated November 16,
1987] as buyer is because as observed by the Court, she being a scheming and exploitive woman, she has
taken advantage of the goodness of Jambrich who at that time was still bewitched by her beauty,
sweetness, and good attitude shown by her to him since he could still very well provide for everything she
needs, he being earning (sic) much yet at that time. In fact, as observed by this Court, the acquisition of
these properties under litigation was at the time when their relationship was still going smoothly and
harmoniously.10 [Emphasis supplied.]

The dispositive portion of the Decision states:

WHEREFORE, . . . Decision is hereby rendered in favor of the plaintiff and against the defendant
Antoniet[t]a Opalla by:

1) Declaring plaintiff as the owner in fee simple over the residential house of strong materials and
three parcels of land designated as Lot Nos. 1, 3 and 5 which are covered by TCT Nos. 24790,
24791 and 24792 issued by the Register of Deeds of Mandaue City;

2) Declaring as null and void TCT Nos. 24790, 24791 and 24792 issued in the name of defendant
Antoniet[t]a Descallar by the Register of Deeds of Mandaue City;

3) Ordering the Register of Deeds of Mandaue City to cancel TCT Nos. 24790, 24791 and 24792 in
the name of defendant Antoniet[t]a Descallar and to issue new ones in the name of plaintiff
Camilo F. Borromeo;

4) Declaring the contracts now marked as Exhibits “I,” “K” and “L” as avoided insofar as they appear
to convey rights and interests over the properties in question to the defendant Antoniet[t]a
Descallar;

5) Ordering the defendant to pay plaintiff attorney’s fees in the amount of ₱25,000.00 and litigation
expenses in the amount of ₱10,000.00; and,

6) To pay the costs.11

Respondent appealed to the Court of Appeals. In a Decision dated April 10, 2002,12 the appellate court
reversed the decision of the trial court. In ruling for the respondent, the Court of Appeals held:

We disagree with the lower court’s conclusion. The circumstances involved in the case cited by the lower
court and similar cases decided on by the Supreme Court which upheld the validity of the title of the
subsequent Filipino purchasers are absent in the case at bar. It should be noted that in said cases, the title
to the subject property has been issued in the name of the alien transferee (Godinez et al., vs. Fong Pak
Luen et al., 120 SCRA 223 citing Krivenko vs. Register of Deeds of Manila, 79 Phils. 461; United Church
Board for World Ministries vs. Sebastian, 159 SCRA 446, citing the case of Sarsosa Vda. De Barsobia vs.
Cuenco, 113 SCRA 547; Tejido vs. Zamacoma, 138 SCRA 78). In the case at bar, the title of the subject
property is not in the name of Jambrich but in the name of defendant-appellant. Thus, Jambrich could not
have transferred a property he has no title thereto.13

Petitioner’s motion for reconsideration was denied.

Hence, this petition for review.

Petitioner assigns the following errors:

I. THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED IN DISREGARDING RESPONDENT’S

JUDICIAL ADMISSION AND OTHER OVERWHELMING EVIDENCE ESTABLISHING JAMBRICH’S
PARTICIPATION, INTEREST AND OWNERSHIP OF THE PROPERTIES IN QUESTION AS FOUND BY
THE HONORABLE TRIAL COURT.

II. THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED IN HOLDING THAT JAMBRICH HAS
NO TITLE TO THE PROPERTIES IN QUESTION AND MAY NOT THEREFORE TRANSFER AND
ASSIGN ANY RIGHTS AND INTERESTS IN FAVOR OF PETITIONER.

III. THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED IN REVERSING THE WELL-REASONED
DECISION OF THE TRIAL COURT AND IN IMPOSING DOUBLE COSTS AGAINST HEREIN
PETITIONER (THEN, PLAINTIFF-APPELLEE).14

First, who purchased the subject properties?

The evidence clearly shows, as pointed out by the trial court, who between respondent and Jambrich
possesses the financial capacity to acquire the properties in dispute. At the time of the acquisition of the
properties in 1985 to 1986, Jambrich was gainfully employed at Simmering-Graz Panker A.G., an Austrian
company. He was earning an estimated monthly salary of ₱50,000.00. Then, Jambrich was assigned to
Syria for almost one year where his monthly salary was approximately ₱90,000.00.

On the other hand, respondent was employed as a waitress from 1984 to 1985 with a monthly salary of
not more than ₱1,000.00. In 1986, when the parcels of land were acquired, she was unemployed, as
admitted by her during the pre-trial conference. Her allegations of income from a copra business were
unsubstantiated. The supposed copra business was actually the business of her mother and their family,
with ten siblings. She has no license to sell copra, and had not filed any income tax return. All the
motorized bancas of her mother were lost to fire, and the last one left standing was already scrap. Further,
the Child Study Report15 submitted by the Department of Social Welfare and Development (DSWD) in the
adoption proceedings of respondent’s two sons by Jambrich disclosed that:

Antonietta tried all types of job to support the children until she was accepted as a waitress at St. Moritz
Restaurant in 1984. At first she had no problem with money because most of the customers of St. Moritz
are (sic) foreigners and they gave good tips but towards the end of 1984 there were no more foreigners
coming because of the situation in the Philippines at that time. Her financial problem started then. She
was even renting a small room in a squatters area in Gorordo Ave., Cebu City. It was during her time of
great financial distress that she met Wilhelm Jambrich who later offered her a decent place for herself
and her children.16

The DSWD Home Study Report17 further disclosed that:

[Jambrich] was then at the Restaurant of St. Moritz when he saw Antonietta Descallar, one of the
waitresses of the said Restaurants. He made friends with the girl and asked her to tutor him in [the] English
language. Antonietta accepted the offer because she was in need of additional income to support [her] 2
young children who were abandoned by their father. Their session was agreed to be scheduled every
afternoon at the residence of Antonietta in the squatters area in Gorordo Avenue, Cebu City. The Austrian
was observing the situation of the family particularly the children who were malnourished. After a few
months sessions, Mr. Jambrich offered to transfer the family into a decent place. He told Antonietta that
the place is not good for the children. Antonietta who was miserable and financially distressed at that
time accepted the offer for the sake of the children.18

Further, the following additional pieces of evidence point to Jambrich as the source of fund used to
purchase the three parcels of land, and to construct the house thereon:
 (1) Respondent Descallar herself affirmed under oath, during her re-direct examination and during
the proceedings for the adoption of her minor children, that Jambrich was the owner of the
properties in question, but that his name was deleted in the Deed of Absolute Sale because of
legal constraints. Nonetheless, his signature remained in the deed of sale, where he signed as
buyer.

(2) The money used to pay the subject parcels of land in installments was in postdated checks issued
by Jambrich. Respondent has never opened any account with any bank. Receipts of the
installment payments were also in the name of Jambrich and respondent.

(3) In 1986-1987, respondent lived in Syria with Jambrich and her two children for ten months, where
she was completely under the support of Jambrich.

(4) Jambrich executed a Last Will and Testament, where he, as owner, bequeathed the subject
properties to respondent.

Thus, Jambrich has all authority to transfer all his rights, interests and participation over the subject
properties to petitioner by virtue of the Deed of Assignment he executed on July 11, 1991.

Well-settled is the rule that this Court is not a trier of facts. The findings of fact of the trial court are
accorded great weight and respect, if not finality by this Court, subject to a number of exceptions. In the
instant case, we find no reason to disturb the factual findings of the trial court. Even the appellate court
did not controvert the factual findings of the trial court. They differed only in their conclusions of law.

Further, the fact that the disputed properties were acquired during the couple’s cohabitation also does
not help respondent. The rule that co-ownership applies to a man and a woman living exclusively with
each other as husband and wife without the benefit of marriage, but are otherwise capacitated to marry
each other, does not apply.19 In the instant case, respondent was still legally married to another when
she and Jambrich lived together. In such an adulterous relationship, no co-ownership exists between the
parties. It is necessary for each of the partners to prove his or her actual contribution to the acquisition
of property in order to be able to lay claim to any portion of it. Presumptions of co-ownership and equal
contribution do not apply.20
Second, we dispose of the issue of registration of the properties in the name of respondent alone. Having
found that the true buyer of the disputed house and lots was the Austrian Wilhelm Jambrich, what now
is the effect of registration of the properties in the name of respondent?

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.
A certificate of title implies that the title is quiet,23 and that it is perfect, absolute and indefeasible.24
However, there are well-defined exceptions to this rule, as when the transferee is not a holder in good
faith and did not acquire the subject properties for a valuable consideration.25 This is the situation in the
instant case. Respondent did not contribute a single centavo in the acquisition of the properties. She had
no income of her own at that time, nor did she have any savings. She and her two sons were then fully
supported by Jambrich.

Respondent argued that aliens are prohibited from acquiring private land. This is embodied in Section 7,
Article XII of the 1987 Constitution,26 which is basically a reproduction of Section 5, Article XIII of the 1935
Constitution,27 and Section 14, Article XIV of the 1973 Constitution.28 The capacity to acquire private
land is dependent on the capacity “to acquire or hold lands of the public domain.” Private land may be
transferred only to individuals or entities “qualified to acquire or hold lands of the public domain.” Only
Filipino citizens or corporations at least 60% of the capital of which is owned by Filipinos are qualified to
acquire or hold lands of the public domain. Thus, as the rule now stands, the fundamental law explicitly
prohibits non-Filipinos from acquiring or holding title to private lands, except only by way of legal
succession or if the acquisition was made by a former natural-born citizen.29

Therefore, in the instant case, the transfer of land from Agro-Macro Development Corporation to
Jambrich, who is an Austrian, would have been declared invalid if challenged, had not Jambrich conveyed
the properties to petitioner who is a Filipino citizen. In United Church Board for World Ministries v.
Sebastian,30 the Court reiterated the consistent ruling in a number of cases31 that if land is invalidly
transferred to an alien who subsequently becomes a Filipino citizen or transfers it to a Filipino, the flaw in
the original transaction is considered cured and the title of the transferee is rendered valid. Applying
United Church Board for World Ministries, the trial court ruled in favor of petitioner, viz.:

[W]hile the acquisition and the purchase of (sic) Wilhelm Jambrich of the properties under litigation [were]
void ab initio since [they were] contrary to the Constitution of the Philippines, he being a foreigner, yet,
the acquisition of these properties by plaintiff who is a Filipino citizen from him, has cured the flaw in the
original transaction and the title of the transferee is valid.
The trial court upheld the sale by Jambrich in favor of petitioner and ordered the cancellation of the TCTs
in the name of respondent. It declared petitioner as owner in fee simple of the residential house of strong
materials and three parcels of land designated as Lot Nos. 1, 3 and 5, and ordered the Register of Deeds
of Mandaue City to issue new certificates of title in his name. The trial court likewise ordered respondent
to pay petitioner ₱25,000 as attorney’s fees and ₱10,000 as litigation expenses, as well as the costs of
suit.

We affirm the Regional Trial Court.

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. The Decision of the Court of Appeals in C.A. G.R. CV No.
42929 dated April 10, 2002 and its Resolution dated July 8, 2003 are REVERSED and SET ASIDE. The
Decision of the Regional Trial Court of Mandaue City in Civil Case No. MAN-1148 is REINSTATED.

SO ORDERED.

Republic of the Philippines

SUPREME COURT
Manila

SECOND DIVISION

G.R. No. 202932 October 23, 2013

EDILBERTO U. VENTURA JR., Petitioner,

vs.
SPOUSES PAULINO and EVANGELINE ABUDA, Respondents.

DECISION
CARPIO, J.:

The Case

This petition for review on certiorari seeks to annul the Decision1 dated 9 March 2012 of the Court of
Appeals (CA) in CA-G.R. CV No. 92330 and the Resolution2 dated 3 August 2012 denying the
motion for reconsideration. The Decision and Resolution dismissed the Appeal dated 23 October
2009 and affirmed with modification the Decision3dated 24 November 2008 of the Regional Trial
Court of Manila, Branch 32 (RTC-Manila).

The Facts

The RTC-Manila and the CA found the facts to be as follows:

Socorro Torres (Socorro) and Esteban Abletes (Esteban) were married on 9 June 1980. Although
Socorro and Esteban never had common children, both of them had children from prior marriages:
Esteban had a daughter named Evangeline Abuda (Evangeline), and Socorro had a son, who was
the father of Edilberto U. Ventura, Jr. (Edilberto), the petitioner in this case.

Evidence shows that Socorro had a prior subsisting marriage to Crispin Roxas (Crispin) when she
married Esteban. Socorro married Crispin on 18 April 1952. This marriage was not annulled, and
Crispin was alive at the time of Socorro’s marriage to Esteban.

Esteban’s prior marriage, on the other hand, was dissolved by virtue of his wife’s death in 1960.
According to Edilberto, sometime in 1968, Esteban purchased a portion of a lot situated at 2492
State Alley, Bonifacio Street, Vitas, Tondo, Manila (Vitas property). The remaining portion was
thereafter purchased by Evangeline on her father’s behalf sometime in 1970.4 The Vitas property
was covered by Transfer Certificate of Title No. 141782, dated 11 December 1980, issued to
"Esteban Abletes, of legal age, Filipino, married to Socorro Torres."5

Edilberto also claimed that starting 1978, Evangeline and Esteban operated small business
establishments located at 903 and 905 Delpan Street, Tondo, Manila (Delpan property).6

On 6 September 1997, Esteban sold the Vitas and Delpan properties to Evangeline and her
husband, Paulino Abuda (Paulino).7 According to Edilberto:

when Esteban was diagnosed with colon cancer sometime in 1993, he decided to sell the Delpan
and Vitas properties to Evangeline. Evangeline continued paying the amortizations on the two (2)
properties situated in Delpan Street. The amortizations, together with the amount of Two Hundred
Thousand Pesos (Php 200,000.00), which Esteban requested as advance payment, were
considered part of the purchase price of the Delpan properties. Evangeline likewise gave her father
Fifty Thousand Pesos (Php 50,000.00) for the purchase of the Vitas properties and she shouldered
his medical expenses.8

Esteban passed away on 11 September 1997, while Socorro passed away on 31 July 1999.

Sometime in 2000, Leonora Urquila (Leonora), the mother of Edilberto, discovered the sale. Thus,
Edilberto, represented by Leonora, filed a Petition for Annulment of Deeds of Sale before the RTC-
Manila. Edilberto alleged that the sale of the properties was fraudulent because Esteban’s signature
on the deeds of sale was forged. Respondents, on the other hand, argued that because of Socorro’s
prior marriage to Crispin, her subsequent marriage to Esteban was null and void. Thus, neither
Socorro nor her heirs can claim any right or interest over the properties purchased by Esteban and
respondents.9

The Ruling of the RTC-Manila

The RTC-Manila dismissed the petition for lack of merit.

The RTC-Manila ruled that the marriage between Socorro and Esteban was void from the
beginning.10 Article 83 of the Civil Code, which was the governing law at the time Esteban and
Socorro were married, provides:

Art. 83. Any marriage subsequently contracted by any person during the lifetime of the first spouse
of such person shall be illegal and void from its performance unless:

1. The first marriage was annulled or dissolved; or

2. The first spouse had been absent for seven consecutive years at the time of the second
marriage without the spouse present having news of the absentee being alive, or if the
absentee, though he has been absent for less than seven years, is generally considered as
dead and believed to be so by the spouse present at the time of contracting such
subsequent marriage, or if the absentee is presumed dead according to articles 390 and
391. The marriage so contracted shall be valid in any of the three cases until declared null
and void.

During trial, Edilberto offered the testimony of Socorro’s daughter-in-law Conchita Ventura
(Conchita). In her first affidavit, Conchita claimed that Crispin, who was a seaman, had been missing
and unheard from for 35 years. However, Conchita recanted her earlier testimony and executed an
Affidavit of Retraction.11

The RTC-Manila ruled that the lack of a judicial decree of nullity does not affect the status of the
union. It applied our ruling in Niñal v. Badayog:12

Jurisprudence under the Civil Code states that no judicial decree is necessary in order to establish
the nullity of a marriage. x x x

Under ordinary circumstances, the effect of a void marriage, so far as concerns the conferring of
legal rights upon the parties, is as though no marriage had ever taken place. And therefore, being
good for no legal purpose, its invalidity can be maintained in any proceeding in which [the] fact of
marriage may be material, either direct or collateral, in any civil court between any parties at any
time, whether before or after the death of either or both the husband and the wife, and upon mere
proof of the facts rendering such marriage void, it will be disregarded or treated as non-existent by
the courts.13

According to the RTC-Manila, the Vitas and Delpan properties are not conjugal, and are governed by
Articles 144 and 485 of the Civil Code, to wit:

Art. 144. When a man and a woman live together as husband and wife, but they are not married, or
their marriage is void from the beginning, the property acquired by either or both of them through
their work or industry or their wages and salaries shall be governed by the rules on co-ownership.
Art. 485. The share of the co-owners, in the benefits as well as in the charges, shall be proportional
to their respective interests. Any stipulation in a contract to the contrary shall be void.

The portions belonging to the co-owners in the co-ownership shall be presumed equal, unless the
contrary is proved.

The RTC-Manila then determined the respective shares of Socorro and Esteban in the properties. It
found that:

with respect to the property located at 2492 State Alley, Bonifacio St. Vitas, Tondo, Manila covered
by TCT No. 141782, formerly Marcos Road, Magsaysay Village, Tondo, Manila, [Evangeline]
declared that part of it was first acquired by her father Esteban Abletes sometime in 1968 when he
purchased the right of Ampiano Caballegan. Then, in 1970, she x x x bought the right to one-half of
the remaining property occupied by Ampiano Caballegan. However, during the survey of the
National Housing Authority, she allowed the whole lot to be registered in her father’s name. As proof
thereof, she presented Exhibits "8" to "11" x x x. These documents prove that that she has been an
occupant of the said property in Vitas, Tondo even before her father and Socorro Torres got married
in June, 1980.14

Anent the parcels of land and improvements thereon 903 and 905 Del Pan Street, Tondo, Manila, x
x x Evangeline professed that in 1978, before her father met Socorro Torres and before the
construction of the BLISS Project thereat, her father [already had] a bodega of canvas (lona) and a
sewing machine to sew the canvas being sold at 903 Del Pan Street, Tondo Manila. In 1978, she
was also operating Vangie’s Canvas Store at 905 Del Pan Street, Tondo, Manila, which was
evidenced by Certificate of Registration of Business Name issued in her favor on 09 November 1998
x x x. When the BLISS project was constructed in 1980, the property became known as Units D-9
and D-10. At first, her father [paid] for the amortizations for these two (2) parcels of land but when he
got sick with colon cancer in 1993, he asked respondents to continue paying for the amortizations x
x x. [Evangeline] paid a total of ₱195,259.52 for Unit D-9 as shown by the 37 pieces of receipts x x x
and the aggregate amount of ₱188,596.09 for Unit D-10, as evidenced by 36 receipts x x x.15

The RTC-Manila concluded that Socorro did not contribute any funds for the acquisition of the
properties. Hence, she cannot be considered a co-owner, and her heirs cannot claim any rights over
the Vitas and Delpan properties.16

Aggrieved, Edilberto filed an appeal before the CA.

The Ruling of the CA

In its Decision17 dated 9 March 2012, the CA sustained the decision of the RTC-Manila. The
dispositive portion of the CA Decision reads:

WHEREFORE, the Appeal is hereby DENIED and the challenged Decision of the court a quo
STANDS.

SO ORDERED.18

The CA ruled, however, that the RTC-Manila should have applied Article 148 of the Family Code,
and not Articles 144 and 485 of the Civil Code. Article 148 of the Family Code states that in unions
between a man and a woman who are incapacitated to marry each other:
 x x x only the properties acquired by both of the parties through their actual joint contribution of
money, property, or industry shall be owned by them in common in proportion to their respective
contributions. In the absence of proof to the contrary, their contributions and corresponding shares
are presumed to be equal. The same rule and presumption shall apply to joint deposits of money
and evidences of credit.

If one of the parties is validly married to another, his or her share in the co-ownership shall accrue to
the absolute community or conjugal partnership existing in such valid marriage. If the party who
acted in bad faith is not validly married to another, his or her share shall be forfeited in the manner
provided in the last paragraph of the preceding Article.

The foregoing rules on forfeiture shall likewise apply even if both parties are in bad faith.

The CA applied our ruling in Saguid v. Court of Appeals,19 and held that the foregoing provision
applies "even if the cohabitation or the acquisition of the property occurred before the effectivity of
the Family Code."20 The CA found that Edilberto failed to prove that Socorro contributed to the
purchase of the Vitas and Delpan properties. Edilberto was unable to provide any documentation
evidencing Socorro’s alleged contribution.21

On 2 April 2012, Edilberto filed a Motion for Reconsideration,22 which was denied by the CA in its
Resolution dated 3 August 2012.23

Hence, this petition.

The Ruling of this Court

We deny the petition.

Edilberto admitted that in unions between a man and a woman who are incapacitated to marry each
other, the ownership over the properties acquired during the subsistence of that relationship shall be
based on the actual contribution of the parties. He even quoted our ruling in Borromeo v.
Descallar24 in his petition:

It is necessary for each of the partners to prove his or her actual contribution to the acquisition of
property in order to be able to lay claim to any portion of it. Presumptions of co-ownership and equal
contribution do not apply.25

This is a reiteration of Article 148 of the Family Code, which the CA applied in the assailed decision:

Art 148. In cases of cohabitation [wherein the parties are incapacitated to marry each other], only the
properties acquired by both of the parties through their actual joint contribution of money, property,
or industry shall be owned by them in common in proportion to their respective contributions. In the
absence of proof to the contrary, their contributions and corresponding shares are presumed to be
equal. The same rule and presumption shall apply to joint deposits of money and evidences of
credit.

If one of the parties is validly married to another, his or her share in the co-ownership shall accrue to
the absolute community or conjugal partnership existing in such valid marriage. If the party who
acted in bad faith is not validly married to another, his or her share shall be forfeited in the manner
provided in the last paragraph of the preceding Article.
The foregoing rules on forfeiture shall likewise apply even if both parties are in bad faith.

Applying the foregoing provision, the Vitas and Delpan properties can be considered common
property if: (1) these were acquired during the cohabitation of Esteban and Socorro; and (2) there is
evidence that the properties were acquired through the parties’ actual joint contribution of money,
property, or industry.

Edilberto argues that the certificate of title covering the Vitas property shows that the parcel of land
is co-owned by Esteban and Socorro because: (1) the Transfer Certificate of Title was issued on 11
December 1980, or several months after the parties were married; and (2) title to the land was
issued to "Esteban Abletes, of legal age, married to Socorro Torres."26

We disagree. The title itself shows that the Vitas property is owned by Esteban alone. The phrase
1âwphi1

"married to Socorro Torres" is merely descriptive of his civil status, and does not show that Socorro
co-owned the property.27 The evidence on record also shows that Esteban acquired ownership over
the Vitas property prior to his marriage to Socorro, even if the certificate of title was issued after the
celebration of the marriage. Registration under the Torrens title system merely confirms, and does
not vest title. This was admitted by Edilberto on page 9 of his petition wherein he quotes an excerpt
of our ruling in Borromeo:

Registration is not a mode of acquiring ownership. It is only a means of confirming the fact of its
existence with notice to the world at large. Certificates of title are not a source of right. The mere
possession of a title does not make one the true owner of the property. Thus, the mere fact that
respondent has the titles of the disputed properties in her name does not necessarily, conclusively
and absolutely make her the owner. The rule on indefeasibility of title likewise does not apply to
respondent. A certificate of title implies that the title is quiet, and that it is perfect, absolute and
indefeasible. However, there are well-defined exceptions to this rule, as when the transferee is not a
holder in good faith and did not acquire the subject properties for a valuable consideration.

Edilberto claims that Esteban s actual contribution to the purchase of the Delpan property was not
sufficiently proven since Evangeline shouldered some of the amortizations.28 Thus, the law
presumes that Esteban and Socorro jointly contributed to the acquisition of the Del pan property.

We cannot sustain Edilberto s claim. Both the RTC-Manila and the CA found that the Delpan
property was acquired prior to the marriage of Esteban and Socorro.29 Furthermore, even if payment
of the purchase price of the Delpan property was made by Evangeline, such payment was made on
behalf of her father. Article 1238 of the Civil Code provides:

Art. 1238. Payment made by a third person who does not intend to be reimbursed by the debtor is
deemed to be a donation, which requires the debtor s consent. But the payment is in any case valid
as to the creditor who has accepted it.

Thus, it is clear that Evangeline paid on behalf of her father, and the parties intended that the Delpan
property would be owned by and registered under the name of Esteban.

During trial, the Abuda spouses presented receipts evidencing payments of the amortizations for the
Delpan property. On the other hand, Edilberto failed to show any evidence showing Socorro s
1âw phi1

alleged monetary contributions. As correctly pointed out by the CA:

settled is the rule that in civil cases x x x the burden of proof rests upon the party who, as
determined by the pleadings or the nature of the case, asserts the affirmative of an issue. x x x. Here
it is Appellant who is duty bound to prove the allegations in the complaint which undoubtedly, he
miserably failed to do so.30

WHEREFORE, the petition is DENIED. The Decision dated 9 March 2012 of the Court of Appeals in
CA-G.R. CV No. 92330 is AFFIRMED.

SO ORDERED.

G.R. No. 198356, April 20, 2015

ESPERANZA SUPAPO AND THE HEIRS OF ROMEO SUPAPO, NAMELY:

ESPERANZA, REX EDWARD, RONALD TROY, ROMEO, JR., SHEILA
LORENCE, ALL SURNAMED SUPAPO, AND SHERYL FORTUNE SUPAPO-
SANDIGAN, Petitioners, v. SPOUSES ROBERTO AND SUSAN DE JESUS,
MACARIO BERNARDO, AND THOSE PERSONS CLAIMING RIGHTS
UNDER THEM, Respondent.

DECISION

BRION, J.:

We resolve the petition for review on certiorari1 filed by petitioners Esperanza Supapo and Romeo
Supapo2 (Spouses Supapo) to assail the February 25, 2011 decision3 and August 25, 2011 resolution4 of the
Court of Appeals (CA) in CA-G.R. SP No. 111674.

Factual Antecedents

The Spouses Supapo filed a complaint5 for accion publiciana against Roberto and Susan de Jesus (Spouses
de Jesus), Macario Bernardo (Macario), and persons claiming rights under them (collectively,
the respondents), with the Metropolitan Trial Court (MeTC) of Caloocan City.

The complaint sought to compel the respondents to vacate a piece of land located in Novaliches, Quezon
City, described as Lot 40, Block 5 (subject lot). The subject lot is covered by Transfer Certificate of Title
(TCT) No. C-284416 registered and titled under the Spouses Supapo's names. The land has an assessed
value of thirty-nine thousand nine hundred eighty pesos (39,980.00) as shown in the Declaration of Real
Property Value (tax declaration) issued by the Office of the City Assessor of Caloocan.7

The Spouses Supapo did not reside on the subject lot. They also did not employ an overseer but they made
sure to visit at least twice a year.8 During one of their visits in 1992, they saw two (2) houses built on the
subject lot. The houses were built without their knowledge and permission. They later learned that the
Spouses de Jesus occupied one house while Macario occupied the other one.9

The Spouses Supapo demanded from the respondents the immediate surrender of the subject lot by
bringing the dispute before the appropriate Lupong Tagapamayapa. The Lupon issued a Katibayan Upang
Makadulog sa Hukuman (certificate to file action) for failure of the parties to settle amicably.10

The Spouses Supapo then filed a criminal case11 against the respondents for violation of Presidential Decree
No. 772 or the Anti-Squatting Law.12 The trial court convicted the respondents. The dispositive portion of the
decision reads:
 WHEREFORE, in view of all the foregoing, this Court finds accused ROBERTO DE JESUS,
SUSAN DE JESUS and MACARIO BERNARDO, GUILTY beyond reasonable doubt for Violation
of Presidential Decree No. 772, and each accused is hereby ordered to pay a fine of ONE
THOUSAND PESOS (P1,000.00), and to vacate the subject premises.

SO ORDERED.13 (Emphasis supplied.)

The respondents appealed their conviction to the CA.14 While the appeal was pending, Congress enacted
Republic Act (RA) No. 8368, otherwise known as "An Act Repealing Presidential Decree No. 772," which
resulted to the dismissal of the criminal case.15

On April 30, 1999, the CA's dismissal of the criminal case became final.16

Notwithstanding the dismissal, the Spouses Supapo moved for the execution of the respondents' civil
liability, praying that the latter vacate the subject lot. The Regional Trial Court (RTC) granted the motion
and issued the writ of execution. The respondents moved for the quashal of the writ but the RTC denied the
same. The RTC also denied the respondents' motion for reconsideration.

The respondents thus filed with the CA a petition for certiorari to challenge the RTC's orders denying the
quashal of the writ and the respondent's motion for reconsideration.17 The CA granted the petition and held
that with the repeal of the Anti-Squatting Law, the respondents' criminal and civil liabilities were
extinguished.18 The dispositive portion of the decision reads:

WHEREFORE, premises considered, the petition for certiorari with prayer for injunction
is GRANTED. The orders dated June 5, 2003 and July 24, 2003 of Branch 131 of the
Regional Trial Court of Caloocan City in Criminal Case No. C-45610
are REVERSED and SET ASIDE. Said court is hereby permanently ENJOINED from
further executing or implementing its decision dated March 18, 1996.

SO ORDERED.

The CA, however, underscored that the repeal of the Anti-Squatting Law does not mean that people now
have unbridled license to illegally occupy lands they do not own, and that it was not intended to compromise
the property rights of legitimate landowners.19 In cases of violation of their property rights, the CA noted
that recourse may be had in court by filing the proper action for recovery of possession.

The Spouses Supapo thus filed the complaint for action publiciana.20

After filing their Answer,21 the respondents moved to set their affirmative defenses for preliminary
hearing22 and argued that: (1) there is another action pending between the same parties; (2) the complaint
for accion publiciana is barred by statute of limitations; and (3) the Spouses Supapo's cause of action is
barred by prior judgment.

The MeTC Ruling23

The MeTC denied the motion to set the affirmative defenses for preliminary hearing. It ruled that the
arguments advanced by the respondents are evidentiary in nature, which at best can be utilized in the
course of the trial. The MeTC likewise denied the respondents' motion for reconsideration.

From the MeTC's ruling, the respondents filed a petition for certiorari with the RTC.24

The RTC Ruling25

The RTC granted the petition for certiorari on two grounds, viz.: (i) the action has prescribed; and (ii) accion
publiciana falls within the exclusive jurisdiction of the RTC.

It held that in cases where the only issue involved is possession, the MeTC has jurisdiction if the action for
forcible entry or unlawful detainer is filed within one (1) year from the time to demand to vacate was made.
Otherwise, the complaint for recovery of possession should be filed before the RTC.

The dispositive portion of the RTC decision reads:

WHEREFORE, premises considered, the instant petition is hereby GRANTED.

The Orders dated October 24, 2008 and February 23, 2009 are hereby
declared NULL and VOID.

The Public Respondent is hereby directed to DISMISS Civil Case No. 08-29245 for lack of
jurisdiction.

SO ORDERED.26

In their motion for reconsideration,27 the Spouses Supapo emphasized that the court's jurisdiction over an
action involving title to or possession of land is determined by its assessed value; that the RTC does not
have an exclusive jurisdiction on all complaints for accion publiciana; and that the assessed value of the
subject lot falls within MeTC's jurisdiction.

The RTC denied the petitioners' motion for reconsideration.

It held that although the MeTC had jurisdiction based on the assessed value of the subject lot, the Spouses
Supapos' cause of action had already prescribed, the action having been filed beyond the ten (l0)-year
prescriptive period under Article 555 of the Civil Code.28 As it was not proven when the actual demand to
vacate was made, the RTC ruled that the reckoning period by which the ejectment suit should have been
filed is counted from the time the certificate to file action was issued. The certificate to file action was issued
on November 25, 1992, while the complaint for accion publiciana was filed only on March 7, 2008, or more
than ten (10) years thereafter.

Dissatisfied with the RTC ruling, the Spouses Supapo appealed to the CA.29

The CA Ruling30

The CA dismissed the appeal and held that the complaint for accion publiciana should have been lodged
before the RTC and that the period to file the action had prescribed.

The dispositive portion of the CA decision reads:

WHEREFORE, the appeal is DENIED. The Decision dated June 30, 2009 and Order dated
October 19, 2009 are AFFIRMED.

SO ORDERED

The Spouses Supapo moved31 but failed32 to secure a reconsideration of the CA decision; hence, they came
to us through the present petition.

The Petition

In seeking reversal of the CA's ruling, the Spouses Supapo essentially argue that:

(1) the MeTC exercises exclusive original jurisdiction over accion

publiciana where the assessed value of the property does not exceed
 P20,000.00, or P50,000.00 if the property is located in Metro Manila; and
that

(2) prescription had not yet set in because their cause of action is
imprescriptible under the Torrens system.

The Respondents' Case33

The respondents argue that the complaint for accion publiciana was (1) filed in the wrong court; (2) barred
by prescription; and (3) barred by res judicata.

Issues

The issues for resolution are:

I. Whether the MeTC properly acquired jurisdiction;

II. Whether the cause of action has prescribed; and
III. Whether the complaint for accion publiciana is barred by res judicata.

Our Ruling

The petition is meritorious.

We hold that: (1) the MeTC properly acquired jurisdiction; (2) the cause of action has not prescribed; and
(3) the complaint is not barred by res judicata.

Accion Publiciana and

the Jurisdiction of the
MeTC

Accion publiciana is an ordinary civil proceeding to determine the better right of possession of realty
independent of title. It refers to an ejectment suit filed after the expiration of one year from the accrual of
the cause of action or from the unlawful withholding of possession of the realty.34

In the present case, the Spouses Supapo filed an action for the recovery of possession of the subject lot but
they based their better right of possession on a claim of ownership.

This Court has held that the objective of the plaintiffs in accion publiciana is to recover possession only, not
ownership. However, where the parties raise the issue of ownership, the courts may pass upon the issue to
determine who between the parties has the right to possess the property.35

This adjudication is not a final determination of the issue of ownership; it is only for the purpose of resolving
the issue of possession, where the issue of ownership is inseparably linked to the issue of possession. The
adjudication of the issue of ownership, being provisional, is not a bar to an action between the same parties
involving title to the property. The adjudication, in short, is not conclusive on the issue of ownership.36

Thus, while we will dissect the Spouses Supapo's claim of ownership over the subject property, we will only
do so to determine if they or the respondents should have the right of possession.

Having thus determined that the dispute involves possession over a real property, we now resolve which
court has the jurisdiction to hear the case.

Under Batas Pambansa Bilang 129,37 the jurisdiction of the RTC over actions involving title to or possession
of real property is plenary.38

RA No. 7691,39 however, divested the RTC of a portion of its jurisdiction and granted the Metropolitan Trial
Courts, Municipal Trial Courts and Municipal Circuit Trial Courts the exclusive and original jurisdiction to hear
actions where the assessed value of the property does not exceed Twenty Thousand Pesos (P20,000.00), or
Fifty Thousand Pesos (P50,000.00), if the property is located in Metro Manila.

Section 1 of RA No. 7691 states:

Section 1. Section 19 of Batas Pambansa Blg. 129, otherwise known as the "Judiciary
Reorganization Act of 1980," is hereby amended to read as follows:
Section. 19. Jurisdiction in civil cases. - Regional Trial Courts shall
exercise exclusive original jurisdiction:

(2) In all civil actions which involve the title to, or possession of, real
property, or any interest therein, where the assessed value of the
property involved exceeds Twenty thousand pesos (P20,000.00)
or, for civil actions in Metro Manila, where such value exceeds Fifty
thousand pesos (P50,000.00) x x x. (Emphasis supplied.)

Section 3 of the same law provides:

Section. 3. Section 33 of the same law is hereby amended to read as follows:

Section. 33. Jurisdiction of Metropolitan Trial Courts, Municipal Trial Courts

and Municipal Circuit Trial Courts in Civil Cases. - Metropolitan Trial
Courts, Municipal Trial Courts, and Municipal Circuit Trial Courts
shall exercise:

xxxx

(3) Exclusive original jurisdiction in all civil actions which involve title to,
or possession of, real property, or any interest therein where the
assessed value of the property or interest therein does not exceed
Twenty thousand pesos (P20,000.00) or, in civil actions in Metro
Manila, where such assessed value does not exceed Fifty thousand
pesos (P50,000.00)exclusive of interest, damages of whatever kind,
attorney's fees, litigation expenses and costs x x x. (Emphasis supplied.)

In view of these amendments, jurisdiction over actions involving title to or possession of real property is
now determined by its assessed value.40 The assessed value of real property is its fair market value
multiplied by the assessment level. It is synonymous to taxable value.41

In Quinagoran v. Court of Appeals,42 we explained:

[D]oes the RTC have jurisdiction over all cases of recovery of possession regardless of the
value of the property involved?

The answer is no. The doctrine on which the RTC anchored its denial of petitioner's Motion
to Dismiss, as affirmed by the CA � that all cases of recovery of possession or accion
publiciana lies with the regional trial courts regardless of the value of the property � no
longer holds true. As tilings now stand, a distinction must be made between those
properties the assessed value of which is below P20,000.00, if outside Metro
Manila; and P50,000.00, if within.43 (Emphasis supplied.)

In this regard, the complaint must allege the assessed value of the real property subject of the complaint or
the interest thereon to determine which court has jurisdiction over the action. This is required because the
nature of the action and the court with original and exclusive jurisdiction over the same is determined by the
material allegations of the complaint, the type of relief prayed for by the plaintiff, and the law in effect when
the action is filed, irrespective of whether the plaintiffs are entitled to some or all of the claims asserted
therein.44

In the present case, the Spouses Supapo alleged that the assessed value of the subject lot, located in Metro
Manila, is P39,980.00. This is proven by the tax declaration45 issued by the Office of the City Assessor of
Caloocan. The respondents do not deny the genuineness and authenticity of this tax declaration.

Given that the Spouses Supapo duly complied with the jurisdictional requirements, we hold that the MeTC of
Caloocan properly acquired jurisdiction over the complaint for accion publiciana.

The cause of action

has not prescribed

The respondents argue that the complaint for accion publiciana is dismissible for being filed out of time.

They invoke Article 555 of the Civil Code, which states: Art. 555. A possessor may lose his
possession:

xxxx

(4) By the possession of another, subject to the provisions of Article 537, if the new
possession has lasted longer than one year. But the real right of possession is not
lost till after the lapse of ten years. (Emphasis supplied.)

The respondents point out that the Spouses Supapo filed the complaint for accion publiciana on March 7,
2008 or more than ten (10) years after the certificate to file action was issued on November 25, 1992. The
respondents contend that the Spouses Supapo may no longer recover possession of the subject property,
the complaint having been filed beyond the period provided by law.

Further, while the respondents concede that the Spouses Supapo hold a TCT over the subject property, and
assuming a Torrens title is imprescriptible and indefeasible, they posit that the latter have lost their right to
recover possession because of laches.

On their part, the Spouses Supapo admit that they filed the complaint for accion publiciana more than ten
(10) years after the certificate to file action was issued. Nonetheless, they argue that their cause of action is
imprescriptible since the subject property is registered and titled under the Torrens system.

We rule that the Spouses Supapo's position is legally correct.

At the core of this controversy is a parcel of land registered under the Torrens system. The Spouses Supapo
acquired the TCT on the subject lot in 1979.46 Interestingly, the respondents do not challenge the
existence, authenticity and genuineness of the Supapo's TCT.47

In defense, the respondents rest their entire case on the fact that they have allegedly been in actual, public,
peaceful and uninterrupted possession of the subject property in the concept of an owner since 1992. The
respondents contend that they built their houses on the subject lot in good faith. Having possessed the
subject lot for more than ten (10) years, they claim that they can no longer be disturbed in their
possession.48

Under the undisputed facts of this case, we find that the respondents' contentions have no legal basis.

In a long line of cases, we have consistently ruled that lands covered by a title cannot be acquired by
prescription or adverse possession. We have also held that a claim of acquisitive prescription is baseless
when the land involved is a registered land because of Article 112649 of the Civil Code in relation to Act 496
[now, Section 47 of Presidential Decree (PD) No. 152950].51

The Spouses Supapo (as holders of the TCT) enjoy a panoply of benefits under the Torrens system. The
most essential insofar as the present case is concerned is Section 47 of PD No. 1529 which states:

Section 47. Registered land not subject to prescriptions. No title to registered land in
derogation of the title of the registered owner shall be acquired by prescription or adverse
possession.

In addition to the imprescriptibility, the person who holds a Torrens Title over a land is also entitled to the
possession thereof.52 The right to possess and occupy the land is an attribute and a logical consequence of
ownership.53 Corollary to this rule is the right of the holder of the Torrens Title to eject any person illegally
occupying their property. Again, this right is imprescriptible.54

In Bishop v. CA,55 we held that even if it be supposed that the holders of the Torrens Title were aware of the
other persons' occupation of the property, regardless of the length of that possession, the lawful
owners have a right to demand the return of their property at any time as long as the possession was
unauthorized or merely tolerated, if at all.56

Even if the defendant attacks the Torrens Title because of a purported sale or transfer of the property, we
still rule in favor of the holder of the Torrens Title if the defendant cannot adduce, in addition to the deed of
sale, a duly-registered certificate of title proving the alleged transfer or sale.

A case in point is Umpoc v. Mercado57 in which we gave greater probative weight to the plaintiffs TCT vis-a-
vis the contested unregistered deed of sale of the defendants. Unlike the defendants in Umpoc, however, the
respondents did not adduce a single evidence to refute the Spouses Supapo's TCT. With more reason
therefore that we uphold the indefeasibility and imprescriptibility of the Spouses Supapo's title.

By respecting the imprescriptibility and indefeasibility of the Spouses Supapo's TCT, this Court merely
recognizes the value of the Torrens System in ensuring the stability of real estate transactions and integrity
of land registration.

We reiterate for the record the policy behind the Torrens System, viz.:

The Government has adopted the Torrens system due to its being the most effective
measure to guarantee the integrity of land titles and to protect their indefeasibility once the
claim of ownership is established and recognized. If a person purchases a piece of land on
the assurance that the seller's title thereto is valid, he should not run the risk of being told
later that his acquisition was ineffectual after all, which will not only be unfair to him as the
purchaser, but will also erode public confidence in the system and will force land
transactions to be attended by complicated and not necessarily conclusive investigations
and proof of ownership. The further consequence will be that land conflicts can be even
more abrasive, if not even violent.58

With respect to the respondents' defense59 of laches, suffice it to say that the same is evidentiary in nature
and cannot be established by mere allegations in the pleadings.60 In other words, the party alleging laches
must adduce in court evidence proving such allegation. This Court not being a trier of facts cannot rule on
this issue; especially so since the lower courts did not pass upon the same.

Thus, without solid evidentiary basis, laches cannot be a valid ground to deny the Spouses Supapo's
petition.61 On the contrary, the facts as culled from the records show the clear intent of the Spouses Supapo
to exercise their right over and recover possession of the subject lot, viz.: (1) they brought the dispute to
the appropriate Lupon; (2) they initiated the criminal complaint for squatting; and (3) finally, they filed
the action publiciana. To our mind, these acts negate the allegation of laches.

With these as premises, we cannot but rule that the Spouses Supapo's right to recover possession of the
subject lot is not barred by prescription.
The action is not barred
by prior judgment

As a last-ditch effort to save their case, the respondents invoke res judicata. They contend that the decision
of the CA in CA-G.R. SP No. 78649 barred the filing of the action publiciana.

To recall, CA-G.R. SP No. 78649 is the petition for certiorari filed by the respondents to challenge the RTC's
issuance of the writ enforcing their civil liability (i.e., to vacate the subject property) arising from their
conviction under the Anti-Squatting Law. The CA granted the petition and permanently enjoined the
execution of the respondents' conviction because their criminal liability had been extinguished by the repeal
of the law under which they were tried and convicted. It follows that their civil liability arising from the crime
had also been erased.

The respondents' reliance on the principle of res judicata is misplaced.

Res judicata embraces two concepts: (1) bar by prior judgment as enunciated in Rule 39, Section 47(b) of
the Rules of Civil Procedure; and (2) conclusiveness of judgment in Rule 39, Section 47(c).62

"Bar by prior judgment" means that when a right or fact had already been judicially tried on the merits and
determined by a court of competent jurisdiction, the final judgment or order shall be conclusive upon the
parties and those in privity with them and constitutes an absolute bar to subsequent actions involving the
same claim, demand or cause of action.63

The requisites64 for res judicata under the concept of bar by prior judgment are:

(1) The former judgment or order must be final;

(2) It must be a judgment on the merits;

(3) It must have been rendered by a court having jurisdiction over the subject matter and
the parties; and

(4) There must be between the first and second actions, identity of parties,
subject matter, and cause of action.

Res judicata is not present in this case.

While requisites one to three may be present, it is obvious that the there is no identity of subject matter,
parties and causes of action between the criminal case prosecuted under the Anti-Squatting Law and
the civil action for the recovery of the subject property.

First, there is no identity of parties. The criminal complaint, although initiated by the Spouses Supapo,
was prosecuted in the name of the people of the Philippines. The accion publiciana, on the other hand, was
filed by and in the name of the Spouses Supapo.

Second, there is no identity of subject matter. The criminal case involves the prosecution of a crime
under the Anti-Squatting Law while the accion publiciana is an action to recover possession of the subject
property.

And third, there is no identity of causes of action. The people of the Philippines filed the criminal case
to protect and preserve governmental interests by prosecuting persons who violated the statute. The
Spouses Supapo filed the accion publiciana to protect their proprietary interests over the subject property
and recover its possession.

Even casting aside the requirement of identity of causes of action, the defense of res judicata has still no
basis.
The concept of "conclusiveness of judgment" does not require that there is identity of causes of action
provided that there is identity of issue and identity of parties.65

Under this particular concept of res judicata, any right, fact, or matter in issue directly adjudicated or
necessarily involved in the determination of an action before a competent court in which judgment is
rendered on the merits is conclusively settled by the judgment therein and cannot again be litigated
between the parties and their privies, whether or not the claim, demand, purpose, or subject matter of the
two actions is the same.66

As already explained, there is no identity of parties between the criminal complaint under the Anti-Squatting
law and the civil action for accion publiciana. For this reason alone, "collusiveness of judgment" does not
apply.

Even if we assume, for the sake of argument, that there is identity of parties, "conclusiveness of judgment"
still does not apply because there is no identity of issues. The issue in the criminal case is whether the
respondents (accused therein) committed the crime alleged in the information, while the only issue in accion
publiciana is whether the Spouses Supapo have a better right than the respondents to possess and occupy
the subject property.

For all these reasons, the defense of res judicata is baseless.

Final Note

As a final note, we stress that our ruling in this case is limited only to the issue of determining who between
the parties has a better right to possession. This adjudication is not a final and binding determination of the
issue of ownership. As such, this is not a bar for the parties or even third persons to file an action for the
determination of the issue of ownership.

WHEREFORE, premises considered, we GRANT the petition, and consequently REVERSE and SET
ASIDEthe February 25, 2011 decision and August 25, 2011 resolution of the Court of Appeals in CA-G.R. SP
No. 111674.

SO ORDERED.

SECOND DIVISION

[G.R. No. 108547. February 3, 1997]

FELICIDAD VDA. DE CABRERA, MARYJANE CABRERA and FELICIDAD TEOKEMIAN, plaintiff, vs. COURT OF
APPEALS and VIRGILIA ORAIS DE FELICIO, represented by her Attorney-in-Fact, ERNESTO M. ORAIS,
defendants.

DECISION
TORRES, JR., J.:

Assailed in this Petition for Review on Certiorari is the Decision[1] of the respondent Court of Appeals
dated January 7, 1993 in CA-G.R. No. 22407-CV, the dispositive portion of which reads:

WHEREFORE, the decision of the lower court is hereby REVERSED and judgment is hereby entered
ordering defendants Felicidad Vda. De Cabrera and Marykane Cabrera to vacate the portion of Lot 2238
occupied by them and surrender possession thereof to plaintiff.

SO ORDERED.

Reversed by the foregoing pronouncements was the decision[2] of the Regional Trial Court, Branch 7,
Baganga, Davao Oriental in Civil Case No. 379, an action for Quieting of Title to Real Property, Damages
with Preliminary Injunction. The trial courts disposition reads:

WHEREFORE, the plaintiff is hereby ordered:

(a) To execute a reconveyance within thirty (30) days after this decision shall have become final and
executory in favor of defendant Felicidad Vda. De Cabrera corresponding only to that portion of
Lot No. 2239 actually and physically possessed and occupied by the defendant as seen from the
sketch plan of Engr. Enecio Magno (Exh. 2) and pinpointed and identified during the ocular
investigation as to its extent and boundaries of the said portion bought by defendants Felicidad
Vda. De Cabrera from Felicidad Teokemian;

(b) To reimburse defendants for litigation expenses and attorneys fees in the amount of P7,000.00;
and

© To pay the cost.

SO ORDERED.

We are restating the facts as determined by the appellate court, viz:

On January 16, 1950, a Deed of Sale (Exh. B) was executed by Daniel Teokemian and Albertana Teokemian
in favor of Andres Orais over a parcel of unregistered land situated at Abejod, Cateel, Davao Oriental with
an area described as 7.3720 hectares. The property was owned in common by Daniel and Albertana and
their sister Felicidad Teokemian, having inherited the same from their late father, Domingo Teokemian.
However, the Deed of Sale was not signed by Felicidad, although her name was printed therein as one of
the vendors. On January 26, 1950, the parcel of land was surveyed in the name of Virgilia Orais, daughter
of the vendee Andres Orais, and denominated as Lot No. 2239, PLS-287, Cateel Cadastre. As surveyed, the
property had an area of 11.1000 hectares.

On June 24, 1957, Virgilia Orais was issued Free Patent No. V-79089. Original Certificate of Title No. P-
10908 was issued in her name (Exh. A).

On July 27, 1972, Alberto (sic. Albertana) Teokemian executed a Deed of Absolute Sale conveying to Elano
Cabrera, husband of Felicidad Cabrera, ONE HALF PORTION OF LOT NO. 2239, Cad-287, eastern portion,
containing an area of FIFTY FIVE THOUSAND FIVE HUNDRED TEN (55,510) SQUARE METERS, more or less
(Exh. 3), which portion supposedly corresponded to the one-third share in Lot 2239 of Felicidad
Teokemian who was not a party to the Deed of Sale earlier executed by her brother and sister in favor of
Andres Orais, Virgilia Orais predecessor-in-interest. It was explained by Felicidad Cabrera that the Deed
of Sale was signed by Albertana Teokemian, not by Felicidad Teokemian, because the whole of Lot 2239
was adjudicated to Albertana in a decision of a cadastral court dated June 8, 1965 as evidenced by a
Certification of an officer-in-charge of the Office of the Clerk of Court, RTC, Br. 7, Baganga, Davao Oriental
(Exh. 4). Felicidad Cabrera and her husband immediately took possession of the western portion of Lot
2239.

In 1974 and 1978, Virgilia Orais brothers, Rodolfo and Jimmy Orais went to Cateel, Davao Oriental and
confronted the Cabreras of the latters alleged encroachment and illegal occupation of their sisters land,
but no concrete action on the matter was pursued by Virgilia Orais until February 11, 1988 when she filed
Civil Case No. 379 against Felicidad Cabrera, now a widow, and her daughter Marykane Cabrera for
Quieting of Title to Real Property, Damages with Preliminary Mandatory Injunction.

The complaint, which was amended on June 22, 1988 by including Felicidad Teokemian as party defendant
(pp. 42-47, Records), alleged that sometime in 1972 and 1973 the late Elano Cabrera and defendant
Felicidad Cabrera, knowing that Lot 2239 was already registered in the name of the plaintiff, prepared a
document of sale and had Felicidad Teokemian sign it conveying a portion of said lot to them as described
in the Sketch Map (Annex D of the Complaint), after which they entered and possessed said portion and
enjoyed the fruits thereon. Plaintiff further averred that by reason of the document of sale and the
declaration of the property involved in the name of defendant Felicidad Vda. De Cabrera, there created a
cloud of doubt on the formers title on said property.
Plaintiff prayed as follows:

WHEREFORE, premises considered, plaintiff through the undersigned counsel respectfully prays this
Honorable Court that:

a) After due notice and hearing, a Writ of Preliminary Mandatory Injunction be issued restraining
the defendants from further dispossessing the plaintiff of the land in question;

b) Ordering the defendants to pay jointly the plaintiff the amount of not less than Sixteen Thousand
Two Hundred (P16,200) as total value of the rice produced from the riceland in question, and the
amount of Twenty One Thousand Six Hundred (P21,600.00) Pesos as the total proceeds of the
nuts of the coconut land in question;

c) The Defendants be ordered to pay the plaintiff the amount of Twenty Thousand (P20,000.00)
Pesos and Ten Thousand (P10,000.00) Pesos as litigation expenses;

d) The defendants be ordered to pay Six Thousand (P6,000.00) Pesos for attorneys fees; Four
Hundred (P400.00) Pesos as expenses for every appearance in Court;

e) The document of sale executed by Felicidad Teokemian and the Tax Declarations issued to the
late Elano Cabrera and Felicidad Vda. De Cabrera and the subsequent Tax Declaration creating a
cloud of doubt on the title, possession, rights and interest be declared null and void for being
fraudulent and without any legal basis and inexistent; and

f) Such other reliefs and remedies which this Honorable Court may deem just, proper, and equitable
in the premises.

In their answer with counterclaim (pp.10-18, Records), defendants alleged that they acquired a portion of
Lot 2239 in good faith and for value; that said portion was owned by Felicidad Teokemian who was not a
party to the Deed of Sale executed by Daniel and Albertana Teokemian on January 16, 1950 in favor of
Andres Orais over Lot 2239; that not having signed the Deed of Sale, Felicidad Teokemians one-third share
in Lot 2239 could not have been legally conveyed to Andres Orais; that Virgilia Orais (successor-in-interest
of Andres Orais) committed fraud in including the portion owned by Felicidad Teokemian in her applying
for free patent over Lot 2239 is concerned pursuant to Art. 1456 of the Civil Code; and that plaintiff is
guilty of laches for not initiating an action against defendants to recover the western portion of Lot 2239
despite plaintiffs knowledge of defendants acquisition thereof in 1972, as in fact it was only in 1988 when
the complaint for quieting of title was filed in court.

Defendants prayed, thus:

WHEREFORE, this Honorable Court, after due notice and hearing on the merits of this case; to issue order
or orders;

1. Finding the defendants as the rightful, lawful, and legal owner of that portion which was sold to
them by Felicidad Teokemian and which was included in the title of plaintiff;

2. To find that the plaintiff did not own the said portion and that they have personal knowledge of
the same when the plaintiff filed and secured the title under the Administrative Proceeding;

3. Finding that the plaintiff is only holding the title to that portion only in an implied trust in favor of
the real owner;

4. Finding the plaintiff legally obligated to cause the segregation of the portion at their expense and
deliver formally the said portion to the real owners, the defendants.

5. To order the plaintiff to execute, prepare and or make any instrument or document to finally vest
in the Defendants absolute, clear and flawless title or ownership over the portion which the
plaintiff holds title in trust in defendants favor.

6. To Order the Plaintiff to pay actual damages in the sum of P2,000.00 as litigation expense and
Attorneys fees in the sum of P5,000.00 in favor of defendants;
 7. To direct the plaintiff to account for the share of the real owner of the portion of land illegally
cultivated and planted by plaintiff to rice in favor of FELICIDAD TEOKEMIAN to be paid thru the
Defendants who are the owners, which consisted in ONE THIRD OF THE RICE HARVEST every year
since the year 1950 to 1972 when the portion was sold and cultivated by defendant based on the
computation of income by the plaintiff in Paragraph 16, a paragraph in the Second Cause of Action
of the complaint;

And to grant the defendants such other reliefs and remedies proper and equitable in the premises.[3]

On April 27, 1989, the lower court rendered judgment in favor of defendants and against the plaintiff,
ruling that the latter can no longer recover the western portion of Lot 2239 conveyed in 1972 by Felicidad
Teokemian in favor of the late Elano Cabrera and Felicidad Cabrera due to laches. In support of its findings,
the trial court referred to the Courts pronouncements in Lola vs. Court of Appeals,[4] where it was held
that although the defense of prescription is unavailing to the petitioners, because, admittedly, the title to
the subject lot was still registered in the name of the respondent, still the petitioners have acquired title
to it by virtue of the equitable principle of laches due to the respondents failure to assert her claim and
ownership for thirty-two years; and in Republic vs. Court of Appeals[5] that, while it is true that by
themselves tax receipts and declaration of ownership for taxation purposes are not incontrovertible
evidence of ownership, they become strong evidence of ownership acquired by prescription when
accompanied by proof of actual possession of the property; and in Miguel vs. Catalino,[6] that even
granting appellants proposition that no prescription lies against their fathers recorded title, their passivity
and inaction for more than thirty four years justifies the defendant appellee in setting up the equitable
defense of laches in his own behalf.

The respondent Court of Appeals reversed such findings upon appeal.

Even as the appellate court observed that the registration made by the plaintiffs was fraudulent insofar
as it involved the one-third interest of Felicidad Teokemian, which was not included in the sale executed
by them and Albertana and Daniel Teokemian, it nevertheless upheld its effects, on the justification that
the defendants action for reconveyance based on an implied trust had already been barred by
prescription. Furthermore, the action of the plaintiffs is not barred by laches, as was held by the lower
court. Said the appellate court:

We disagree with the lower courts ruling that plaintiff is barred from bringing an action for recovery of
ownership. Parenthetically, while the complaint filed by plaintiff is designated as one for quieting of title,
the allegations therein show that it is actually for recovery of ownership/possession.
First. The Deed of Absolute Sale dated May 27, 1972 (Exh. 3) executed by Albertana Teokemian in favor
of Elcano Cabrera over the portion of 55,510 square meters of Lot 2238 which allegedly pertained to the
one-third interest of Felicidad Teokemian did not convey any title to Elcano Cabrera, assuming that
Felicidad Teokemian still owned a one-third portion of Lot 2238 which was already registered in plaintiffs
name, considering that Albertana did not have any authority from Felicidad Teokemian to effect such
conveyance. Consequently, defendants Felicidad vda. De Cabrera and Marykane Cabrera had acquired no
title upon which to anchor their claim of ownership over the one-third portion. Such being the case,
plaintiffs cannot be barred by laches from instituting the action to quiet title against defendants

Xxx

Second. There was no allegation, much less proof, that Lot 2239 had been partitioned among the co-
owners Daniel, Albertana, and Felicidad, all surnamed Teokemian, before the land was sold to Andres
Orais in 1950 when the same was still unregistered. This being the case, and assuming that Felicidad
Teokemian had retained ownership over an undivided one-third portion of Lot 2239 despite its being titled
in plaintiffs name in 1958, Felicidad Teokemian could only dispose her undivided interest, not a definite
portion described in the Deed of Sale executed on July 27, 1972 (Exh. 3) as eastern part. Worse, the
supposed vendee, Elcano Cabrera, and her successors-in-interest, defendants Felicidad vda. De Cabrera
and Marykane Cabrera, occupied the western portion of Lot 2239, not the eastern portion which was the
subject of the sale. Their occupation of a definite portion of an undivided property, without any color of
title, could not have ripened into ownership on the principle of laches.

Third. As testified to by Jimmy Orais, plaintiffs brother, it was only in 1974 when plaintiff came to know
that her property was occupied by Elcano Cabrera. According to Jimmy, he and his elder brother Dr.
Rodolfo Orais went to the house of Elcano Cabrera three times in 1974 and in 1979 complaining of the
latters occupancy of their sisters property. Jimmy further declared that after Elcano Cabrera was shown
plaintiffs title to the property, Elcano Cabrera proposed a relocation survey of the area to determine
whether the premises occupied by him were included in the plaintiffs title (T.S.N. pp. 39-44, January 3,
1989). It appears, however, that nothing came out of the proposal to conduct a relocation survey. From
the time plaintiff became aware of Cabreras possession of the western portion of Lot 2239, which was in
1974, up to the time she instituted the action for quieting of title in 1988, only fourteen (14) years had
elapsed. This case, therefore, has no congruency with those cases where the Supreme Court ruled that
the registered owner is barred by laches from recovering his property. Thus, in Lola vs. Court of Appeals
(145 SCRA 439), the petitioners acquired title to the land owned by respondent by virtue of the equitable
principles of laches due, according to the Supreme Court, to respondents failure to assert her claims and
ownership for thirty-two (32) years. In Miguel vs. Catalino (26 SCRA 234), the Supreme Court said that
appellants passivity and inaction for more than 34 years (1928-1962) justifies the defendant-appellee in
setting up the equitable defense of laches in his behalf. In Mejia vs. Gampomana (100 Phil 277), it was
held that the original owners right to recover back the possession of the property and title thereto from
the defendant has by the long period of 37 years and by the patentees inaction and neglect been
converted into a stale demand.
Laches, in a general sense, is failure or neglect, for an unreasonable and unexplained length of time, to do
that which, by the exercise of due diligence, could or should have been done earlier; it is negligence or
omission to assert a right within a reasonable time, warranting a presumption that the party entitled to
assert it (Tijam vs. Sibonghanoy, 32 SCRA 29). Since imprescriptibility is one of the basic features of a
Torrens title, it is not an ordinary delay in asserting ones right that will give rise to the application of the
principle of laches, otherwise, registered title can easily be defeated by prescription. This is precisely the
reason why, in the cases cited, the delay or inaction by the registered owners in asserting their rights was
considered unreasonable and unexplained because it took them from 32 to 37 years to do so. In contrast,
the delay in the case at bar was only fourteen years.

While possession of defendants Felicidad vda. De Cabrera and Marykane Cabrera could not have ripened
into ownership as already discussed, they are possessors in good faith of the portion occupied by them
and, therefore, entitled to the benefits accorded by the Civil Code as such.[7]

Sisters Felicidad vda. De Cabrera and Marykane Cabrera, together with Felicidad Teokemian are now
before the Court as Petitioners in this Petition for Review on Certiorari, seeking relief from the respondent
courts decision, assigning as errors the following:

RESPONDENT COURT OF APPEALS ERRED IN RULING THAT PRIVATE RESPONDENTS COMPLAINT FILED IN
1988 FOR QUIETING OF TITLE WHICH ACTUALLY IS ONE FOR RECOVERY OF OWNERSHIP AND POSSESSION
AS FOUND BY RESPONDENT COURT IS NOT BARRED BY LACHES BECAUSE:

1. A PERIOD OF 30 YEARS HAD ELAPSED FROM 1958 WHEN TORRENS TITLE WAS ISSUED TO PRIVATE
RESPONDENT TO 1988 WHEN HER COMPLAINT BELOW WAS FILED DURING WHICH PERIOD OF
TIME THE PROPERTY HAS BEEN IN OPEN, CONTINUOUS AND ADVERSE POSSESSION OF THE
ORIGINAL OWNER, FELICIDAD TEOKEMIAN, FROM 1958, OR EVEN EARLIER IN 1941 WHEN SHE
INHERITED THE PROPERTY, TO 1972 WHEN SHE SOLD IT TO THE CABRERAS WHO CONTINUED THE
PRIOR POSSESSION UNTIL 1988 WHEN PRIVATE RESPONDENTS COMPLAINT WAS FILED.

2. ASSUMING ARGUENDO RESPONDENT COURTS HOLDING THAT ONLY 14 YEARS HAD ELAPSED
COUNTED FROM 1974 WHEN CABRERAS POSSESSION WAS QUESTIONED BY PRIVATE
RESPONDENTS BROTHERS, STILL THAT PERIOD CONSTITUTES LACHES.
B

RESPONDENT COURT OF APPEALS ERRED IN HOLDING THAT LACHES DOES NOT APPLY BECAUSE WHAT
WAS SOLD TO THE CABRERAS WAS A DEFINITE PORTION OF THE COMMUNITY PROPERTY BEFORE
PARTITION, HENCE, VOID AND THAT ALBERTANA TEOKEMIAN WHO SIGNED THE DOCUMENT OF SALE IN
FAVOR OF THE CABRERAS HAD NO AUTHORITY FROM HER SISTER-CO-OWNER FELICIDAD TEOKEMIAN TO
EXECUTE THE DEED OF CONVEYANCE.[8]

The bone of the petitioners contention rests on the alleged waiver of the plaintiff to recover any interest
she had in the one-third portion of the property inherited by Daniel, Albertana and Felicidad Teokemian
from their late father, Domingo, due to the long period of time which lapsed from the time the plaintiffs
title was registered until the action for quieting of title was instituted.

We find merit in the petition.

At the outset, it must be observed that the Certificate of Title of the plaintiff, which was derived from Free
Patent No. V-79089, issued in the name of Virgilia Orais, leaves much to be desired in propriety,
considering that the Deed of Sale executed by Daniel and Albertana Teokemian, on one hand and Andres
Orais on the other, did not bear the signature of Felicidad Teokemian, and therefore, did not cover the
latters share.

It was the respondent appellate court which observed that the registration of the plaintiffs title over the
subject property was fraudulent insofar as it involved the one-third interest of Felicidad Teokemian who
did not sign the Deed of Sale in favor of plaintiffs predecessor-in-interest and, therefore, the latter held
that portion as a trustee of an implied trust for the benefit of Felicidad, pursuant to Art. 1456 of the Civil
Code.[9] Needless to state, these conclusions, being matters of fact, are entitled to our full affirmation,
since they are congruent with the findings of the trial court, thus:

It would seem from the facts of the case that the basis of the right of plaintiff over the land in litigation
specifically Lot No. 2239 now titled in the name of the plaintiff, located at Buayahon, Abejod, Cateel,
Davao Oriental, proceeded from the Deed of Sale executed by Daniel Teokemian and Albertana
Teokemian on January 16, 1950 acknowledged before Judge Proserador Danao as Notary Ex Oficio. Taking
a hard look over the aforesaid deed of sale (Exh. B) the said document apparently included the third heir
of Domingo Teokemian Felicidad Teokemian because her name was typewritten together with her sister
Albertana and brother Daniel all surnamed Teokemian in the said document. Again this fact will come to
mind that the vendee Andres Orais was anticipating at the time Felicidad Teokemian will also sell her
share in this portion of land (Lot No. 2239) which at the time of the sale it was still unregistered land. The
non-signing of Felicidad Teokemian over her typewritten name in this deed of sale (Exh. B) will attest to
the fact that she did not sell her share in the lot in question. After this sale the vendee Andres Orais
through his encargado Melecio Capilitan and later Servillano Abarca immediately took possession of the
two third portion of said parcel of land respecting the third portion owned by Felicidad Teokemian.[10]

However, the appellate court stated further that nonetheless, the plaintiffs attempt to recover the
property is justified because defendant Felicidad Teokemians own action for reconveyance has already
been barred by prescription,[11] which is the same as stating that the very tardiness of the plaintiffs in
pursuing the present action for reconveyance of the subject property has rendered the defendants
defense nugatory, and has made the fortress of the plaintiffs case impregnable.

This conclusion is incorrect. As can be discerned from the established facts, the Certificates of Title of the
vendees Orais are, to say the least, irregular, and were issued in a calculated move to deprive Felicidad
Teokemian of her dominical rights over the property reserved to her by descent. Plaintiff could not have
registered the part reserved to Felicidad Teokemian, as this was not among those ceded in the Deed of
Sale between Daniel/Albertana Teokemian and Andres Orais. It must be remembered that registration
does not vest title, it is merely evidence of such title over a particular property. (Embrado vs. Court of
Appeals)[12]

The defense of indefeasibility of the Torrens Title does not extend to a transferee who takes the certificate
of title with notice of a flaw in his title. (Anonuevo vs. Court of Appeals)[13] The principle of indefeasibility
of title is unavailing where there was fraud that attended the issuance of the free patents and titles.
(Meneses vs. Court of Appeals)[14]

Be that as it may, that the right of the defendants for reconveyance of the subject property arising from
an implied trust under Article 1456 of the Civil Code is material to the instant case, such remedy has not
yet lapsed, as erroneously submitted by the plaintiffs, and, is thus, a bar to the plaintiffs action. In the
case of Heirs of Jose Olviga vs. Court of Appeals,[15] we observed that an action for reconveyance of a
parcel of land based on implied or constructive trust prescribes in ten years, the point of reference being
the date of registration of the deed or the date of the issuance of the certificate of title over the property,
but this rule applies only when the plaintiff or the person enforcing the trust is not in possession of the
property, since if a person claiming to be the owner thereof is in actual possession of the property, as the
defendant is in the instant case, the right to seek reconveyance, which in effect seeks to quiet title to the
property, does not prescribe. The reason for this is that one who is in actual possession of a piece of land
claiming to be the owner thereof may wait until his possession is disturbed or his title is attacked before
taking steps to vindicate his right, the reason for the rule being, that his undisturbed possession gives him
a continuing right to seek the aid of a court of equity to ascertain and determine the nature of the adverse
claim of a third party and its effect on his own title, which right can be claimed only by one who is in
possession.
As it is, before the period of prescription may start, it must be shown that (a) the trustee has performed
unequivocal acts of repudiation amounting to an ouster of the cestui que trust; (b) such positive acts of
repudiation have been made known to the cestui que trust; and, (c) the evidence thereon is clear and
positive.[16]

In the case at bar, the defendant Felicidad Teokemian, and thereafter, the Cabreras, were in actual
possession of the property since it was left to Felicidad Teokemian by her father in 1941, which possession
had not been interrupted, despite the sale of the two-third portion thereof to the plaintiff in 1950, and
the latters procurement of a Certificate of Title over the subject property in 1957. Until the institution of
the present action in 1988, plaintiffs, likewise, have not displayed any unequivocal act of repudiation,
which could be considered as an assertion of adverse interest from the defendants, which satisfies the
above-quoted requisites. Thus, it cannot be argued that the right of reconveyance on the part of the
defendants, and its use as defense in the present suit, has been lost by prescription.

On the other hand, the action for reconveyance (quieting of title) of the plaintiff was instituted only in
1988, that is, thirty years from the time the plaintiffs husband was able to acquire Certificate of Title
covering the properties inherited by the Teokemians, and apparently including that portion belonging to
Felicidad Teokemian. In the meantime, defendant Felicidad vda. De Cabrera and her late husband have
been actively in possession of the same, tilling it, and constructing an irrigation system thereon. This must
surely constitute such tardiness on the part of the plaintiff constituting the basis for laches.

Laches has been defined as the failure or neglect, for an unreasonable and unexplained length of time, to
do that which by exercising due diligence could or should have been done earlier; it is negligence or
omission to assert a right within a reasonable time, warranting a presumption that the party entitled to
assert it either has abandoned it or declined to assert it.[17] The defense of laches is an equitable one and
does not concern itself with the character of the defendants title, but only with whether or not by reason
of plaintiffs long inaction or inexcusable neglect, he should be barred from asserting his claim at all,
because to allow him to do so would be inequitable and unjust to defendant. Laches is not concerned
merely with lapse of time, unlike prescription. While the latter deals with the fact of delay, laches deals
with the effect of unreasonable delay.[18]

This Court emphasized in Mejia de Lucas vs. Gampona,[19] the reason upon which the rule is based is not
alone the lapse of time during which the neglect to enforce the right has existed, but the changes of
condition which may have arisen during the period in which there has been neglect. In other words, where
a court finds that the position of the parties has to change, that equitable relief cannot be afforded
without doing injustice, or that the intervening rights of third persons may be destroyed or seriously
impaired, it will not exert its equitable powers in order to save one from the consequences of his own
neglect.
In our jurisdiction, it is an enshrined rule that even a registered owner of property may be barred from
recovering possession of property by virtue of laches. Under the Land Registration Act (now the Property
Registration Decree), no title to registered land in derogation to that of the registered owner shall be
acquired by prescription or adverse possession. The same is not true with regard to Laches.[20] As we
have stated earlier in Mejia de Lucas vs. Gamponia, while the defendant may not be considered as having
acquired title by virtue of his and his predecessors long continued possession (37 years) the original
owners right to recover back the possession of the property and the title thereto from the defendant has,
by the latters long period of possession and by patentees inaction and neglect, been converted into a stale
demand.

The argument that laches does not apply because what was sold to the Cabreras was a definite portion of
the community property, and, therefore, void, is likewise untenable.

Under Article 493 of the Civil Code:

Each co-owner shall have the full ownership of his part and of the fruits and benefits pertaining thereto,
and even he may therefore alienate, assign or mortgage it, and even substitute another person in its
enjoyment, except when personal rights are involved. But the effect of the alienation or the mortgage,
with respect to the co-owners, shall be limited to the portion which may be allotted to him in the division
upon the termination of the co-ownership.

In Go Ong vs. Court of Appeals,[21] this Court ruled that the heirs, as co-owners, shall each have the full
ownership of his part and the fruits and benefits pertaining to it. An heir may, therefore, alienate, assign
or mortgage it, and even substitute another person in its enjoyment, except when the personal rights are
involved. But the effect of the alienation or mortgage, with respect to the co-owners, shall be limited to
the portion which may be allotted to him in the division upon the termination of the co-ownership.

Undisputed is the fact that since the sale of the two-third portion of the subject property to the plaintiff,
the latter had allowed Felicidad Teokemian to occupy that one-third portion allotted to her. There has,
therefore, been a partial partition, where the transferees of an undivided portion of the land allowed a
co-owner of the property to occupy a definite portion thereof and has not disturbed the same, for a period
too long to be ignored—the possessor is in a better condition or right (Potior est conditio possidentis).

Clearly, the plaintiff in this instance is barred from asserting her alleged right over the portion subject
matter in the instant case on the ground that their right has been lost by laches. In Bailon-Casilao vs. Court
of Appeals, we ruled that:
As early as 1923, this Court has ruled that even if a co-owner sells the whole property as his, the sale will
affect only his own share but not those of the other co-owners who did not consent to the sale (Punzalan
vs. Boon Liat, 44 Phil 320 [1923]). This is because under the aforementioned codal provision, the sale or
other dispostion affects only his undivided share and the transferee gets only what would correspond to
his grantor in the partition of the things owned in common (Ramirez vs. Bautista, 14 Phil 528 [1909]). Xxx
For Article 494 of the Civil Code explicitly declares: No prescription shall lie in favor of a co-owner or co-
heir so long as he expressly or impliedly recognizes the co-ownership.[22]

IN VIEW WHEREOF, the petition is hereby GRANTED. The decision of the Court of Appeals dated January
7, 1993 is hereby SET ASIDE. The decision of the trial court dated April 27, 1989 is hereby REINSTATED in
toto.

SO ORDERED.

Tiongco Vs Tiongco

October 19, 2011

VILLARAMA, JR., J.:

Before us on appeal by way of a petition for review on certiorari under Rule 45 is the Court of Appeals
(CA) August 28, 2003 Decision[1] which dismissed petitioner Estrella Tiongco Yareds appeal and affirmed
the Decision[2] of the Regional Trial Court (RTC), Branch 26, of Iloilo City, dismissing petitioners complaint
for annulment of affidavit of adjudication, deeds of sale and Transfer Certificates of Title (TCTs),
reconveyance and damages. Also assailed is the appellate courts November 27, 2003 Resolution[3]
denying petitioners motion for reconsideration.

The factual antecedents, as culled from the records, follow:

Matilde, Jose, Vicente, and Felipe, all surnamed Tiongco, were born to Atanacio and Maria Luis Tiongco.
Together they were known as the Heirs of Maria Luis de Tiongco.
The present dispute involves three parcels of land namely, Lots 3244, 3246 and 1404, all located in Iloilo
City. Lots 3244 and 1404 used to be covered by Original Certificates of Title (OCTs) Nos. 484 and 1482,
respectively, in the names of Matilde (wife of Vicente Rodriguez), Jose (married to Carmen Sonora),
Vicente (married to Ursula Casador), and Felipe (married to Sabina Montelibano), each in undivided share,
while Lot 3246 used to be covered by OCT No. 368 in the name of Heirs of Maria Luis de Tiongco.[4]

While all of the Heirs of Maria Luis de Tiongco have died, they were survived by their children and
descendants. Among the legitimate children of Jose were petitioner and Carmelo Tiongco, the father of
respondent Jose B. Tiongco.[5]

Sometime in 1965, petitioner built her house on Lot 1404[6] and sustained herself by collecting rentals
from the tenants of Lots 3244 and 3246. In 1968, petitioner, as one of the heirs of Jose, filed an adverse
claim affecting all the rights, interest and participation of her deceased father on the disputed lots, but
the adverse claim was annotated only on OCT No. 484 and OCT No. 1482, respectively covering Lots 3244
and 1404.[7]

In 1983, respondent Jose prohibited petitioner from collecting rentals from the tenants of Lots 3244 and
3246. In December 1983, respondent Jose filed a suit for recovery of possession with preliminary
injunction against several tenants of Lots 3244 and 3246 wherein he obtained a judgment in his favor.[8]
Respondent Jose also filed a case for unlawful detainer with damages against petitioner as she was staying
on Lot 1404. While the RTC, Branch 33, of Iloilo City ruled in respondent Joses favor, the CA reversed the
RTCs decision and ruled in favor of petitioner.[9] As such, respondent Jose never took possession of the
properties.

In 1988, when petitioner inquired at the Office of the Register of Deeds of Iloilo City, she discovered that
respondent Jose had already executed an Affidavit of Adjudication[10] dated April 17, 1974, declaring that
he is the only surviving heir of the registered owners and adjudicating unto himself Lots 3244, 3246 and
1404. Consequently, the OCTs of the aforementioned lots were cancelled, and in place thereof, the
Register of Deeds of Iloilo City issued TCT No. T-37195 for Lot 3244, TCT No. T-4665 for Lot 3246, and TCT
No. T-37193 for Lot 1404, all in the name of respondent Jose.[11]

Based on the records with the Register of Deeds, it also appears that on May 10, 1974, the same day when
the TCTs covering Lots 3244 and 1404 were issued, respondent Jose sold the said lots to Catalino Torre.
TCT Nos. T-37195 and T-37193 were thus cancelled and TCT Nos. T-37196 and T-37194 were issued in the
name of Catalino Torre.[12]

Similarly, the records of the Register of Deeds showed that Lot 3246 was likewise disposed of by
respondent Jose. On March 30, 1979, or barely two days after obtaining TCT No. T-4665, respondent Jose
sold Lot 3246 to respondent Antonio G. Doronila, Jr. who was issued TCT No. T-4666 which cancelled TCT
No. T-4665. Catalino Torre also sold Lots 3244 and 1404 on the same date to Doronila who was issued the
corresponding new TCTs.[13] However, just a few days later, or on April 2, 1979, Doronila sold Lot 1404
back to respondent Jose. Lots 3244 and 3246 were also sold back to respondent on January 17, 1980.[14]

On October 2, 1990, petitioner filed a complaint before the court a quo against her nephew respondent
Jose and respondent Antonio G. Doronila, Jr. Petitioner argued that respondent Jose knowingly and
wilfully made untruthful statements in the Affidavit of Adjudication because he knew that there were still
other living heirs entitled to the said properties.[15] Petitioner claimed that the affidavit was null and void
ab initio and as such, it did not transmit or convey any right of the original owners of the properties. Any
transfer whatsoever is perforce likewise null and void.[16] Moreover, the petitioner averred that since
respondent Jose executed said documents through fraud, bad faith, illegal manipulation and
misrepresentation, Lots 3244 and 1404 should be reconveyed to its original registered owners and Lot
3246 to the heirs of Maria Luis de Tiongco subject to subsequent partition among the heirs.[17] Petitioner
also posited that granting for the sake of argument that the affidavit of adjudication was simply voidable,
respondent Jose became a trustee by constructive trust of the property for the benefit of the
petitioner.[18]

Respondent Jose, for his part, argued that the petitioners father, Jose, was not an heir of Maria Luis de
Tiongco but an heir of Maria Cresencia de Loiz y Gonzalez vda. De Tiongco. Respondent Jose claimed that
he was the only legitimate son and that while it was true that he has two other siblings, he refused to
acknowledge them because they are illegitimate.[19] Respondent Jose denied that the series of sales of
the properties was fraudulent. He claimed that Lot 3244 was bought by the City of Iloilo from its own
auction sale for tax delinquency and was merely resold to him. Respondent Jose averred that he has been
paying real property taxes on the said properties for more than ten (10) years and that petitioner collected
rentals from Lots 3244 and 3246 only because he allowed her.[20]

After trial, the Iloilo City RTC ruled in favor of respondent Jose. The court a quo ruled that prescription has
set in since the complaint was filed only on October 2, 1990 or some sixteen (16) years after respondent
Jose caused to be registered the affidavit of adjudication on May 10, 1974.[21]

Aggrieved, petitioner appealed to the CA[22] which, however, sustained the trial courts ruling. The CA
agreed with the trial court that an action for reconveyance can indeed be barred by prescription.
According to the CA, when an action for reconveyance is based on fraud, it must be filed within four years
from discovery of the fraud, and such discovery is deemed to have taken place from the issuance of the
original certificate of title. On the other hand, an action for reconveyance based on an implied or
constructive trust prescribes in ten (10) years from the date of issuance of the original certificate of title
or transfer certificate of title. For the rule is that the registration of an instrument in the Office of the
Register of Deeds constitutes constructive notice to the whole world and therefore the discovery of fraud
is deemed to have taken place at the time of registration.[23]
Petitioner filed a motion for reconsideration of the above ruling, but the CA as aforesaid, denied
petitioners motion. Hence, the present petition for review on certiorari.

Petitioner raised the following arguments in the petition, to wit:

A. THE HONORABLE COURT OF APPEALS ERRED IN AFFIRMING THE LOWER COURT THAT THE
AFFIDAVIT OF ADJUDICATION EXECUTED BY RESPONDENT JOSE B. TIONGCO, WHO IS A LAWYER
AND IS AWARE OF ITS NULLITY, IS MERELY VOIDABLE; ON THE CONTRARY, SAID DOCUMENT IS A
COMPLETE NULLITY BECAUSE RESPONDENT JOSE B. TIONGCO HAS MALICIOUSLY AND IN BAD
FAITH ADJUDICATED IN FAVOR OF HIMSELF THE PROPERTIES IN QUESTION OVER WHICH HE, AS
A LAWYER, KNOWS HE HAS NO RIGHTS WHATSOEVER AND HE ALSO KNOWS HAS BEEN IN
POSSESSION OF THE PETITIONER AND HER PREDECESSORS-IN-INTEREST UNTIL THE PRESENT.

B. THE HONORABLE COURT OF APPEALS ERRED IN AFFIRMING THE DISMISSAL OF

PETITIONERS COMPLAINT BY THE LOWER COURT ON THE GROUND OF PRESCRIPTION BECAUSE
THE RESPONDENT JOSE B. TIONGCOS AFFIDAVIT OF ADJUDICATION, BEING A TOTAL NULLITY, THE
ACTION TO DECLARE SUCH NULLITY AND OF THOSE SUBSEQUENT TRANSACTIONS ARISING FROM
SAID ADJUDICATION DOES NOT PRESCRIBE, ESPECIALLY BECAUSE IN THIS CASE THE PETITIONER
AND HER PREDECESSORS-IN-INTEREST HAVE ALWAYS BEEN IN POSSESSION OF THE LOTS IN
QUESTION AND RESPONDENT JOSE B. TIONGCO HAS NEVER BEEN IN POSSESSION THEREOF.[24]

C. FURTHER, EVEN IF ARGUENDO, THE AFFIDAVIT OF ADJUDICATION IS VOIDABLE, THE

HONORABLE COURT OF APPEALS STILL ERRED IN AFFIRMING THE DISMISSAL OF THE COMPLAINT
BY THE LOWER COURT ON THE GROUND OF PRESCRIPTION BECAUSE THE RESPONDENT, JOSE B.
TIONGCO, BEING A LAWYER AND BEING AWARE OF PETITIONERS OWNERSHIP OF THE LOTS IN
QUESTION, THE SAID AFFIDAVIT OF ADJUDICATION MAKES THE RESPONDENT AN IMPLIED
TRUSTEE THEREOF FOR THE PETITIONER AND THE ACTION FOR RECONVEYANCE BASED ON TRUST
DOES NOT PRESCRIBE SO LONG AS THE BENEFICIARY LIKE THE PETITIONER HAS BEEN IN ACTUAL
PHYSICAL POSSESSION OF THE PROPERTY SUBJECT THEREOF, AS HELD IN THE CASE OF VDA. DE
CABRERA VS. COURT OF APPEALS (267 SCRA 339).[25]
The only issue in this case is who has a better right over the properties.

The petition is meritorious.

The Court agrees with the CAs disquisition that an action for reconveyance can indeed be barred by
prescription. In a long line of cases decided by this Court, we ruled that an action for reconveyance based
on implied or constructive trust must perforce prescribe in ten (10) years from the issuance of the Torrens
title over the property.[26]

However, there is an exception to this rule. In the case of Heirs of Pomposa Saludares v. Court of
Appeals,[27] the Court reiterating the ruling in Millena v. Court of Appeals,[28] held that there is but one
instance when prescription cannot be invoked in an action for reconveyance, that is, when the plaintiff is
in possession of the land to be reconveyed. In Heirs of Pomposa Saludares,[29] this Court explained that
the Court in a series of cases,[30] has permitted the filing of an action for reconveyance despite the lapse
of more than ten (10) years from the issuance of title to the land and declared that said action, when
based on fraud, is imprescriptible as long as the land has not passed to an innocent buyer for value. But
in all those cases, the common factual backdrop was that the registered owners were never in possession
of the disputed property. The exception was based on the theory that registration proceedings could not
be used as a shield for fraud or for enriching a person at the expense of another.

In Alfredo v. Borras,[31] the Court ruled that prescription does not run against the plaintiff in actual
possession of the disputed land because such plaintiff has a right to wait until his possession is disturbed
or his title is questioned before initiating an action to vindicate his right. His undisturbed possession gives
him the continuing right to seek the aid of a court of equity to determine the nature of the adverse claim
of a third party and its effect on his title. The Court held that where the plaintiff in an action for
reconveyance remains in possession of the subject land, the action for reconveyance becomes in effect
an action to quiet title to property, which is not subject to prescription.

The Court reiterated such rule in the case of Vda. De Cabrera v. Court of Appeals,[32] wherein we ruled
that the imprescriptibility of an action for reconveyance based on implied or constructive trust applies
only when the plaintiff or the person enforcing the trust is not in possession of the property. In effect, the
action for reconveyance is an action to quiet the property title, which does not prescribe.

Similarly, in the case of David v. Malay[33] the Court held that there was no doubt about the fact that an
action for reconveyance based on an implied trust ordinarily prescribes in ten (10) years. This rule
assumes, however, that there is an actual need to initiate that action, for when the right of the true and
real owner is recognized, expressly or implicitly such as when he remains undisturbed in his possession,
the statute of limitation would yet be irrelevant. An action for reconveyance, if nonetheless brought,
would be in the nature of a suit for quieting of title, or its equivalent, an action that is imprescriptible. In
that case, the Court reiterated the ruling in Faja v. Court of Appeals[34] which we quote:

X x x There is settled jurisprudence that one who is in actual possession of a piece of land claiming to be
owner thereof may wait until his possession is disturbed or his title is attacked before taking steps to
vindicate his right, the reason for the rule being, that his undisturbed possession gives him a continuing
right to seek the aid of a court of equity to ascertain and determine the nature of the adverse claim of a
third party and its effect on his own title, which right can be claimed only by one who is in possession. No
better situation can be conceived at the moment for Us to apply this rule on equity than that of herein
petitioners whose mother, Felipa Faja, was in possession of the litigated property for no less than 30 years
and was suddenly confronted with a claim that the land she had been occupying and cultivating all these
years, was titled in the name of a third person. We hold that in such a situation the right to quiet title to
the property, to seek its reconveyance and annul any certificate of title covering it, accrued only from the
time the one in possession was made aware of a claim adverse to his own, and it is only then that the
statutory period of prescription commences to run against such possessor.

In this case, petitioners possession was disturbed in 1983 when respondent Jose filed a case for recovery
of possession.[35] The RTC of Iloilo City ruled in respondent Joses favor but the CA on November 28, 1991,
during the pendency of the present controversy with the court a quo, ruled in favor of petitioner.[36]
Petitioner never lost possession of the said properties, and as such, she is in a position to file the complaint
with the court a quo to protect her rights and clear whatever doubts has been cast on her title by the
issuance of TCTs in respondent Joses name.

The Court further observes that the circuitous sale transactions of these properties from respondent Jose
to Catalino Torre, then to Antonio Doronila, Jr., and back again to respondent Jose were quite unusual.
However, this successive transfers of title from one hand to another could not cleanse the illegality of
respondent Joses act of adjudicating to himself all of the disputed properties so as to entitle him to the
protection of the law as a buyer in good faith. Respondent Jose himself admitted that there exists other
heirs of the registered owners in the OCTs. Even the RTC found that [t]hese allegations contained in the
Affidavit of Adjudication executed by defendant Jose B. Tiongco are false because defendant Jose B.
Tiongco is not the only surviving heir of Jose Tiongco, Matilde Tiongco, Vicente Tiongco and Felipe Tiongco
as the latters have other children and grandchildren who are also their surviving heirs.[37]

In the case of Sandoval v. Court of Appeals,[38] the Court defined an innocent purchaser for value as one
who buys property of another, without notice that some other person has a right to, or interest in, such
property and pays a full and fair price for the same, at the time of such purchase, or before he has notice
of the claim or interest of some other persons in the property. He is one who buys the property with the
belief that the person from whom he receives the thing was the owner and could convey title to the
property. A purchaser can not close his eyes to facts which should put a reasonable man on his guard and
still claim that he acted in good faith.
And while it is settled that every person dealing with a property registered under the Torrens title need
not inquire further but only has to rely on the title, this rule has an exception. The exception is when the
party has actual knowledge of facts and circumstances that would impel a reasonably cautious man to
make such inquiry or when the purchaser has some knowledge of a defect or the lack of title in his vendor
or of sufficient facts to induce a reasonably prudent man to inquire into the status of the title of the
property in litigation. The presence of anything which excites or arouses suspicion should then prompt
the vendee to look beyond the certificate and investigate the title of the vendor appearing on the face of
said certificate. One who falls within the exception can neither be denominated an innocent purchaser
for value nor a purchaser in good faith and hence does not merit the protection of the law.[39]

In this case, when the subject properties were sold to Catalino Torre and subsequently to Doronila,
respondent Jose was not in possession of the said properties. Such fact should have put the vendees on
guard and should have inquired on the interest of the respondent Jose regarding the subject
properties.[40] But regardless of such defect on transfer to third persons, the properties again reverted
back to respondent Jose. Respondent Jose cannot claim lack of knowledge of the defects surrounding the
cancellation of the OCTs over the properties and benefit from his fraudulent actions. The subsequent sale
of the properties to Catalino Torre and Doronila will not cure the nullity of the certificates of title obtained
by respondent Jose on the basis of the false and fraudulent Affidavit of Adjudication.

WHEREFORE, the petition for review on certiorari is GRANTED. The August 28, 2003 Decision and
November 27, 2003 Resolution of the Court of Appeals in CA-G.R. CV No. 44794 are hereby REVERSED and
SET ASIDE. The Register of Deeds of Iloilo City is ordered to RESTORE Original Certificates of Title Nos. 484,
1482, and 368, respectively covering Lots 3244, 1404 and 3246, under the name/s of the registered
original owners thereof.

Furthermore, respondent Atty. Jose B. Tiongco is ORDERED to SHOW CAUSE, within ten (10) days from
notice hereof, why he should not be sanctioned as a member of the bar for executing the April 17, 1974
Affidavit of Adjudication and registering the same with the Register of Deeds.

No pronouncement as to costs.

SO ORDERED.
G.R. No. 152007 January 22, 2007

PROCOPIO TAPUROC, HEIRS OF ANTONIA EBE (Deceased) represented by her children namely: HEIRS OF
CELEDONIA PUTONG, namely: FORTUNATO ESCUDERO, TERESITA TABALDINA, CONCORDIO E. NEBRIA,
PEDRO ESCUDERO and LUISA PEDRERA; HEIRS OF EUFEMIO PUTONG, namely: RICARDO PUTONG and
PORFERIA PUTONG; HEIRS OF GREGORIO PUTONG, namely: ROSALIO PUTONG, PERSEVERANDA LOPEZ,
BERNARDO PUTONG and ROSALINDA OMAGAC; HEIRS OF MARIANO PUTONG, namely: SERAPIA DALHOG,
TEODORA AYENG, MARCIANO PUTONG, RESTITUTA LIQUIT, SERAPIA LUAY, FAUSTINO PUTONG and
SOFRONIA PATROLLA, ALL REPRESENTED BY THEIR ATTORNEY-IN- FACT, AUREA P. MERCIDOR, Petitioners,

Vs.

CARMELITA LOQUELLANO VDA. DE MENDE and the HEIRS OF EVANS MENDE, namely: ERIC MITCHEL, ERIC
LYNDON, ERIC FERDINAND, JOSE ERIC ERVIN and JENNIFER MILDRED, ALL SURNAMED MENDE and the
REGISTER OF DEEDS OF THE CITY OF TAGBILARAN, Respondents.

DECISION

GARCIA, J.:

Under consideration is this petition for review under Rule 45 of the Rules of Court to nullify and set aside
the following issuances of the Court of Appeals (CA) in CA-G.R. CV No. 64548, to wit:

1. Decision1 dated September 21, 2001, affirming an earlier decision of the Regional Trial Court
(RTC) of Tagbilaran City, Branch 47, in an action for Declaration of Nullity of Deed of Sale,
Cancellation of Transfer Certificate of Title (TCT) No. (8585) T-4767 and all Subsequent Documents
and Damages, thereat commenced by the herein petitioners against the respondents; and

2. Resolution2 dated January 23, 2002, denying the petitioners’ motion for reconsideration.

The petition embodies an alternative prayer for this Court to remand the case to the trial court for the
presentation of an expert witness.

The facts:
On September 19, 1996, in the RTC of Tagbilaran City, a Complaint for Declaration of Nullity of Deed of
Sale, Cancellation of TCT No. (8585) T-4767 and all Subsequent Documents and Damages3 was filed by
the petitioners against respondents Carmelita Loquellano Vda. De Mende, the Heirs of Evans B. Mende,
and the Register of Deeds of the City of Tagbilaran. Thereat docketed as Civil Case No. 5970 and raffled to
Branch 47 of the court, the Complaint alleges that petitioners Procopio Tapuroc and all the successors-in-
interest of deceased co-owner Antonia Ebe are the co-owners, co-heirs and/or descendants of the original
owners of a parcel of land with an area of 5,795 square meters, more or less, situated in the Barrio (now
District) of Booy, Tagbilaran, Bohol and previously covered by TCT No. 3444; that sometime in 1992, when
the petitioners decided to partition the subject property, they discovered from the Office of the City
Assessor that the title covering the land was already in the name of a certain Evans Mende by virtue of a
Deed of Sale purportedly executed in favor of the latter by their predecessors-in-interest on December
30, 1967; that said Deed of Sale is a forged document because the alleged vendors therein, who were
Procopio Tapuroc and the predecessors-in-interest of the other petitioners, did not sign the conveying
deed nor receive any consideration therefor; and that one of the alleged vendors, Antonia Ebe, had
already passed away in 1960, or long before the purported Deed of Sale was said to have been executed
in 1967. Petitioners, as plaintiffs, thus pray for the nullification of the same Deed of Sale, the cancellation
of the title issued pursuant thereto in the name of Evans Mende and the restoration of the previous title
in their names, plus damages.

In their Answer,4 the respondent Mendes, as defendants, denied the material allegations of the
Complaint and averred that the late Evans Mende, husband of respondent Carmelita Loquellano Vda. De
Mende and father of the herein co-respondents, bought the subject parcel of land from its previous
owners on December 12, 1967 as evidenced by a Deed of Sale duly notarized by Atty. Rodolfo Yap. They
further assert that they had been in open, continuous, and peaceful possession of the land in question
from the time of said sale, and had been religiously paying the realty taxes due thereon. By way of
affirmative defense, the respondents assert that petitioners’ cause of action, if any, had already
prescribed in view of the unreasonable delay in filing the suit in court, let alone the fact that their
(respondents’) title has become indefeasible.

On June 7, 1999, after due proceedings, the trial court came out with its decision5 finding that the
evidence adduced by the plaintiffs (now petitioners) was insufficient to establish their claim that the
questioned Deed of Sale was a forgery. The court explained that despite the opportunity given them, the
plaintiffs failed to present a handwriting expert to determine whether the said Deed of Sale was indeed a
forged instrument, adding that laches had already set in because of plaintiffs’ inaction and neglect in
questioning the supposed forged character of the document after the lapse of more than twenty-nine
(29) years from the time of its execution. Accordingly, the trial court rendered judgment dismissing the
Complaint, thus:

WHEREFORE, PREMISES CONSIDERED, judgment is hereby rendered DISMISSING the complaint for lack of
merit. No compensation for damages, moral, exemplary and litigation expenses is awarded for failure of
plaintiffs (sic) to prove by preponderance of evidence the existence of malice or bad faith in filing the
instant case.

SO ORDERED.

From the adverse decision of the trial court, the petitioners went on appeal to the CA in CA-G.R. CV No.
64548, faulting the court of origin in ruling that they failed to present convincing evidence to prove the
fact of forgery in the execution of the assailed Deed of Sale. They likewise faulted the lower court in
denying their motion to have the original copy of the Deed of Sale in dispute and their own Special Power
of Attorney containing the genuine signatures of their predecessors-in-interest, be examined by a
handwriting expert.

As stated at the outset hereof, the appellate court, in its Decision6 of September 21, 2001, dismissed the
petitioners’ appeal and affirmed that of the trial court. Their motion for reconsideration having been
denied by the CA in its Resolution7 of January 23, 2002, the petitioners are now with this Court via the
instant recourse on their main submission that –

THE HONORABLE COURT OF APPEALS COMMITTED REVERSIBLE ERROR WHEN IT DISMISSED THE APPEAL
OF THE PETITIONERS DESPITE SUFFICIENCY OF SUPPORTING EVIDENCE TO WARRANT A FAVORABLE
JUDGMENT ON THE PART OF THE PETITIONERS,

And presenting for our resolution the following issues:

WHETHER OR NOT THE DEED OF SALE ALLEGEDLY EXECUTED ON DECEMBER 30, 1967 BETWEEN THE
PETITIONERS’ PREDECESSORS-IN-INTEREST AND THE RESPONDENTS IS VALID.

II

WHETHER OR NOT THE COURT OF APPEALS HAS CONTRADICTED ITSELF AND ARRIVED AT A CONCLUSION
CONTRARY TO THE RECORDS, LAW AND THE APPLICABLE JURISPRUDENCE.
The recourse must fail.

As it is, the petitioners call for a review of the facts of the case. This is evident from the pleadings they
filed with this Court. In their main petition8 and Memorandum,9 the petitioners emphatically state:

The issue in the case at bar boils down to whether or not the signatures of the petitioners’ predecessors-
in-interest and Procopio Tapuroc (the only surviving vendor to the alleged deed of sale) were forged; and
if they were, is the declaration of nullity of the said deed of sale dated December 13, 1967 is proper (sic).

Clearly, the foregoing statement calls for a determination of the truth or falsehood of an alleged fact, a
matter not for this Court to resolve. Well-settled is the rule that factual questions may not be raised in a
petition for review on certiorari. Section 1 of Rule 45 of the Revised Rules of Court is explicit. It reads:

SECTION 1. Filing of petition with Supreme Court. – A party desiring to appeal by certiorari from a
judgment or final order or resolution of the Court of Appeals, the Sandiganbayan, the Regional Trial Court
or other courts whenever authorized by law, may file with the Supreme Court a verified petition for review
on certiorari. The petition shall raise only questions of law which must be distinctly set forth. (Emphasis
supplied)

Evident it is from the above that the function of the Court in petitions for review on certiorari is limited to
reviewing errors of law that may have been committed by the lower courts. And, as a matter of sound
practice and procedure, the Court defers and accords finality to the factual findings of trial courts, more
so when, as here, such findings are undisturbed by the appellate court. This factual determination, as a
matter of long and sound appellate practice, deserves great weight and shall not be disturbed on appeal,
save only for the most compelling reasons,10 such as when that determination is clearly without
evidentiary support or when grave abuse of discretion has been committed.11 This is as it should be since
the Court, in petitions for review of CA decisions under Rule 45 of the Rules of Court, usually limits its
inquiry only to questions of law. Stated otherwise, it is not the function of the Court to analyze and weigh
all over again the evidence or premises supportive of the factual holdings of lower courts.12 The Court
refrains from further scrutiny of factual findings of trial courts, more so when those findings are affirmed
by the CA, as here. To do otherwise would defeat the very essence of Rule 45 and would convert the Court
into a trier of facts, which it is not meant to be.13

What is more, it appears undisputed that the assailed Deed of Sale is a public document, having been duly
notarized by a certain Atty. Rodolfo Yap who, unfortunately, had already passed away. Being a notarial
instrument, the deed in question is a public document and as such enjoys the presumption of regularity
in its execution. To overthrow that presumption, sufficient, clear and convincing evidence is required,
otherwise the document should be upheld.14
Petitioners maintain, however, that by merely examining the signatures in the questioned Deed of Sale
and the genuine signatures of their predecessors-in-interest in their Special Power of Attorney, the glaring
dissimilarities between the two sets of signatures are immediately evident to support their claim of
forgery.

We are not convinced.

As a rule, forgery cannot be presumed. It must be proved by clear, positive and convincing evidence. Mere
allegation of forgery is not evidence and the burden of proof lies on the party alleging it.15 Here, the
petitioners failed to discharge their burden.

As it were, the petitioners merely alleged that they filed two motions before the trial court to have the
original copy of the documents in the Office of the Register of Deeds of Tagbilaran City be examined by
handwriting experts but their motions were ignored by the trial court. They then harp on the excuse that
they could not be expected to prove forgery if the trial court denied them the opportunity to do so.

We are not persuaded.

The trial court correctly ruled that the parties themselves dictate the course and flow of the presentation
of evidence, as well as the witnesses for each side. Considering that the case before it is civil, not criminal,
the lower court certainly cannot, on its own, issue an order requiring a handwriting expert to appear
before it and compare the documents presented by the parties. It behooves upon the parties themselves
to call forth their own set of witnesses and present their own evidence to bolster their respective claims.
If the petitioners failed to present an expert witness, only themselves ought to be blamed. For, as the trial
court itself pointed out in its decision:

X x x. Plaintiffs, despite the opportunity given them by this Court, failed to present a handwriting expert
to determine whether there was indeed forgery in the execution of the subject Deed of Sale. In the
absence of the testimony of the handwriting expert, the allegations of forgery by the plaintiffs is merely
self-serving. Unfortunately, this Court is not in the position to assess or evaluate the differences and
similarities in the questioned signatures, much less, categorically state whether or not forgery exists.
Neither could this court rely on the observation of the plaintiffs as to the alleged “glaring differences and
dissimilarities” of the questioned signatures. (Underscoring ours)
Moreover, the technical procedure utilized by handwriting experts, while usually helpful in the
examination of forged documents, is not mandatory or indispensable to the examination or comparison
of handwritings.[16]

In Jimenez v. Commission on Ecumenical Mission and Relations of the United Presbyterian Church in the
USA,[17] the Court identified and explained the factors involved in the examination and comparison of
handwritings:

Xxx [T]he authenticity of a questioned signature cannot be determined solely upon its general
characteristics, similarities or dissimilarities with the genuine signature. Dissimilarities as regards
spontaneity, rhythm, pressure of the pen, loops in the strokes, signs of stops, shades, etc., that may be
found between the questioned signatures and the genuine one are not decisive on the question of the
former’s authenticity. The result of examinations of questioned handwriting, even with the benefit of aid
of experts and scientific instruments, is, at best, inconclusive. There are other factors that must be taken
into consideration. The position of the writer, the condition of the surface on which the paper where the
questioned signature is written is placed, his state of mind, feelings and nerves, and the kind of pen and/or
paper used, play an important role on the general appearance of the signature. Unless, therefore, there
is, in a given case, absolute absence, or manifest dearth, of direct or circumstantial competent evidence
on the character of the questioned handwriting, much weight should not be given to characteristic
similarities, or dissimilarities, between that questioned handwriting and an authentic one.

And to determine forgery, the Court in Cesar v. Sandiganbayan18 (quoting Osborn, The Problem of Proof)
wrote:

The process of identification, therefore, must include the determination of the extent, kind, and
significance of this resemblance as well as of the variation. It then becomes necessary to determine
whether the variation is due to the operation of a different personality, or is only the expected and
inevitable variation found in the genuine writing of the same writer. It is also necessary to decide whether
the resemblance is the result of a more or less skillful imitation, or is the habitual and characteristic
resemblance which naturally appears in a genuine handwriting. When these two questions are correctly
answered the whole problem of identification is solved.

In the present case, all that the petitioners had to offer by way of evidence on the issue of forgery was
their bare denial that their predecessors-in-interest signed the subject Deed of Sale. Such denial will not
suffice to overcome the presumption of regularity of notarized documents, to overthrow which, the
countervailing evidence must be clear, convincing and more than merely preponderant.19

Moreover, and as aptly pointed out by the lower court in its decision of June 7, 1999:
However, even if it were true that the signature of Antonia Ebe is forged, it cannot brush aside the fact
that all the heirs of Antonia Ebe, namely: Celedonia Putong, Eufemio Putong, Gregorio Putong and
Mariano Putong all signed in the Deed of Absolute Sale. As earlier discussed their signatures cannot be
said to have been forged as evidence presented to prove the same is found to be insufficient. Henceforth,
all the rightful heirs who could question the subject sale are themselves signatories of the supposed
questionable transaction.

Meanwhile, granting that Procopio Tapuroc’s signature found on Exh. C is indeed a forgery, he testified in
open court that he discovered the sale and the fact of Mende’s possession of the subject land in 1967 yet
– and did not do anything about it.

At the other end of the spectrum, the respondents presented sufficient proof of their claim of ownership
over the property in dispute. The respondent Mendes maintain that they had been in continuous, peaceful
and open possession of the property since 1967, the year of the alleged sale, or for more than thirty (30)
years now. No less than the petitioners themselves acknowledged this in their pleadings20 before this
Court. And beginning the year 1968, the respondents have been religiously paying the realty taxes due on
the same property. Likewise, when TCT No. 3444 was lost, respondent Carmelita Loquellano Vda. De
Mende filed a petition for judicial reconstitution to secure a second owner’s copy of the lost title. Said
petition went through the proper procedure and thereafter Carmelita was issued a second owner’s copy
of TCT No. 3444 which was later changed to TCT No. (8585) T-4767.

All told, we find that the petitioners, who initiated in the court of origin the basic complaint in this case,
have not sufficiently met the burden of proof to sustain their cause. Additionally, we agree with the CA in
ruling that laches had barred the petitioners:

Xxx The records show that they [petitioners] did not institute any action against the order of the then
Court of First Instance, 14th Judiciary District. Their inaction and failure to assert any right, if any, over the
disputed lot, bars them from recovering the same as said failure clearly asserts to laches.

Not to be overlooked is the fact that the petitioners filed their complaint of declaration of nullity only
after twenty-nine (29) years from the execution of the alleged forged deed of sale. In the meanwhile, title
to the property had already been in the name of respondent Mendes since 1967. The Mendes had been
in open, continuous and peaceful possession of the subject land, and had been religiously paying the realty
taxes due thereon. These are hard facts that ought not to be disregarded. The Court, in a long line of
cases,21 has uniformly held in favor of the registered owner who had been in possession of a disputed
property for a considerable period of time. With the Mendes’ possession in this case having been in the
concept of an owner and the land itself registered in their names for more than thirty (30) years now,
their title thereto had become indefeasible and their possession could no longer be disturbed. The
petitioners’ failure to take the necessary steps to assert their alleged right for at least twenty-nine (29)
years from date of registration of title is fatal to their cause of action on the ground of laches.

As a final note, we emphasize that a Torrens title cannot be collaterally attacked. The question on the
validity of a Torrens title, whether fraudulently issued or not, can be raised only in an action expressly
instituted for that purpose. The title represented by the certificate cannot be changed, altered, modified,
enlarged, diminished, or cancelled in a collateral proceeding. The action for the declaration of nullity of
deed of sale commenced by the petitioners in the RTC of Tagbilaran City is not the direct proceeding
required by law to attack a Torrens certificate of title.

WHEREFORE, the instant petition is DENIED and the challenged decision of the CA is AFFIRMED.

No pronouncement as to costs.

SO ORDERED.

RODRIGUEZ VS RODRIGUEZ

YNARES-SANTIAGO, J.:

This petition for review on certiorari assails the Decision[1] of the Court of Appeals in CA-G.R. SP No. 91442
dated June 27, 2006, which set aside the Decision of the Regional Trial Court (RTC) of Makati City, Branch
134, in Civil Case No. 03-517, and reinstated the Decision of the Metropolitan Trial Court (MTC) of Makati
City, Branch 63, in Civil Case No. 75717, dismissing the complaint for ejectment; as well as the Resolution
denying the motion for reconsideration.

Juanito Rodriguez owned a five-door apartment located at San Jose Street, Guadalupe Nuevo, Makati City,
and covered by TCT No. 144865.[2] On October 27, 1983, Juanito executed a Huling Habilin at Testamento
giving petitioner Cresenciana Tubo Rodriguez, his live-in partner, apartments D and E, and his children
Benjamin Rodriguez (the deceased husband of respondent Evangeline Rodriguez), apartment A,
respondent Buenaventura Rodriguez, apartment B, and respondent Belen Rodriguez, apartment C.[3]

However, on June 14, 1984, Juanito executed a Deed of Absolute Sale over the property in favor of
petitioner.[4] Thus, TCT No. 144865 was cancelled and a new TCT No. 150431 was issued in the name of
the petitioner.[5]
The case arose when petitioner filed on September 20, 2001 a complaint for unlawful detainer against the
respondents, alleging that she is the lawful and registered owner of the property; and that in 1984, she
allowed respondents Evangeline, Buenaventura and Belen, out of kindness and tolerance, to personally
occupy units A, B and D, respectively. However, without her knowledge and consent, respondents
separately leased the units to Montano Magpantay, Mel Navarro and Socorro Escota, who despite
repeated demands, failed and refused to vacate the premises and to pay the rentals thereof.[6]

In their Answer, respondents claimed ownership over the subject property by succession. They alleged
that while petitioner is the registered owner of the property, however, she is not the lawful owner thereof
because the June 14, 1984 Deed of Absolute Sale was simulated and void. As in Civil Case No. 01-1641
now pending before the RTC of Makati City, Branch 141, which they filed to assail the validity of the said
sale, respondents maintain that petitioner exerted undue influence over their father, who at that time
was seriously ill, to agree to the sale of the property for only P20,000.00 after knowing that only two
apartments were given to her in the Huling Habilin at Testamento. Further, she had no cause of action
against them for being a party to the August 23, 1990 Partition Agreement wherein they recognized each
other as co-owners and partitioned the property in accordance with the provision of the last will and
testament.[7]

On February 26, 2002, the MTC rendered a judgment in favor of the respondents and held that the deed
of sale was simulated otherwise petitioner would not have entered into the Partition Agreement, which
legally conferred upon each heir exclusive ownership over their respective shares, thus:

WHEREFORE, the Complaint is DISMISSED. Plaintiff is ordered to pay attorneys fees of P10,000.00 and the
costs of suit in favor of defendants.

SO ORDERED.[8]

On appeal, the RTC reversed the decision of the MTC. It held that petitioners certificate of title is a
conclusive evidence of ownership of the land described therein; and that unless and until said title has
been annulled by a court of competent jurisdiction, such title is existing and valid. This is true also with
respect to the deed of sale. The present action, which involves only the issue of physical or material
possession, is not the proper action to challenge it. Further, the MTC erred when it relied heavily on the
Huling Habilin at Testamento, which was not probated hence has no effect and no right can be claimed
therein. The Partition Agreement which was allegedly entered into pursuant to the Huling Habilin at
Testamento should not also be considered. Thus:

WHEREFORE, premises considered, the decision rendered by the Metropolitan Trial Court, Branch 63,
Makati City, is hereby ordered REVERSED AND SET ASIDE. Consequently, judgment is hereby rendered
ordering the defendants and all persons claiming rights under them to vacate the premises and surrender
the possession thereof to the plaintiff. Defendants are likewise ordered to pay jointly and severally the
plaintiff an amount of P5,000.00 a month per unit beginning 13 August 2001 until they finally vacate the
premises and the costs of this suit.

SO ORDERED.[9]

Aggrieved, respondents filed a petition for review before the Court of Appeals which reversed and set
aside the decision of the RTC and reinstated the decision of the MTC. It held that the MTC correctly
received evidence on ownership since the question of possession could not be resolved without deciding
the issue of ownership. Further, the Huling Habilin at Testamento transmitted ownership of the specific
apartments not only to the respondents but also to the petitioner; and pursuant thereto, the parties
executed the Partition Agreement in accordance with the wishes of the testator, thus:

WHEREFORE, this Court resolves to REVERSE and SET ASIDE the Decision of the Regional Trial Court. The
decision dated February 26, 2002 of the Metropolitan Trial Court, Branch 63, Makati City in Civil Case No.
75717 dismissing the complaint for ejectment is hereby REINSTATED.

SO ORDERED.[10]

The motion for reconsideration was denied hence, petitioner filed the present petition for review raising
the following errors:

I.

THE COURT OF APPEALS COMMITTED A REVERSIBLE ERROR OF LAW AND GRAVE ABUSE OF DISCRETION
IN REVERSING AND SETTING ASIDE THE DECISION OF THE REGIONAL TRIAL COURT AND REINSTATING THE
DECISION OF THE METROPOLITAN TRIAL COURT DISMISSING PETITIONERS COMPLAINT FOR UNLAWFUL
DETAINER.

II.

THE COURT OF APPEALS COMMITTED A REVERSIBLE ERROR OF LAW AND GRAVE ABUSE OF DISCRETION
IN DECLARING THAT THE PROPERTY, A PARCEL OF LAND UPON WHICH A FIVE-UNIT APARTMENT STANDS,
BECAME THE SUBJECT OF JUANITO RODRIGUEZS HULING HABILIN AT TESTAMENTO WHEREIN THE
PROPERTY WAS DISTRIBUTED TO HIS HEIRS (HEREIN RESPONDENTS) INCLUDING THE RESPONDENT
(PETITIONER HEREIN).[11]

Petitioner alleges that as the registered owner of the subject property, she enjoys the right of possession
thereof and that question of ownership cannot be raised in an ejectment case unless it is intertwined with
the issue of possession. While the court may look into the evidence of title or ownership and possession
de jure to determine the nature of possession, it cannot resolve the issue of ownership because the
resolution of said issue would effect an adjudication on ownership which is not proper in the summary
action for unlawful detainer. Petitioner insists that the Court of Appeals erred in ruling that the Huling
Habilin at Testamento transmitted ownership of the specific apartments disregarding the fact that the
same is not probated yet and that the testator changed or revoked his will by selling the property to
petitioner prior to his death.

Contrarily, respondents pray that the instant petition for review be dismissed since the resolution of the
question of ownership by the MTC and the Court of Appeals was provisional only to resolve the issue of
possession. Petitioner can always avail of legal remedies to have the issue of ownership passed upon by
the proper court. Aware of the provisional nature of the resolution on ownership in ejectment cases,
respondents filed Civil Case No. 01-1641 to assail the validity of the deed of sale of the property and the
registration thereof in petitioners name.

The petition has merit.

An action for unlawful detainer exists when a person unlawfully withholds possession of any land or
building against or from a lessor, vendor, vendee or other persons, after the expiration or termination of
the right to hold possession, by virtue of any contract, express or implied.[12] The sole issue to be resolved
is the question as to who is entitled to the physical or material possession of the premises or possession
de facto.[13] Being a summary proceeding intended to provide an expeditious means of protecting actual
possession or right to possession of property, the question of title is not involved[14] and should be raised
by the affected party in an appropriate action in the proper court.[15]

However, when the issue of ownership is raised the court is not ousted of its jurisdiction. Section 16 of
Rule 70 of the Rules of Court provides:

SEC 16. Resolving defense of ownership. When the defendant raises the defense of ownership in his
pleadings and the question of possession cannot be resolved without deciding the issue of ownership, the
issue of ownership shall be resolved only to determine the issue of possession.

Thus, all that the trial court can do is to make an initial determination of who is the owner of the property
so that it can resolve who is entitled to its possession absent other evidence to resolve ownership.[16]
But this adjudication is only provisional and does not bar or prejudice an action between the same parties
involving title to the property.[17]

In the case at bar, petitioners cause of action for unlawful detainer was based on her alleged ownership
of land covered by TCT No. 150431 and that she merely tolerated respondents stay thereat. However,
when respondents leased the apartments to other persons without her consent, their possession as well
as those persons claiming right under them became unlawful upon their refusal to vacate the premises
and to pay the rent. On the other hand, respondents assailed petitioners title by claiming that the deed
of sale upon which it was based was simulated and void. They insisted that they were co-owners thus,
they have the right to possess the said property. To prove their claim, they presented the Huling Habilin
at Testamento of Juanito Rodriguez and the Partition Agreement.

The lower courts considered the following documentary evidence in arriving at their respective decisions,
albeit the RTC decision contradicts that of the MTC and Court of Appeals: 1) Huling Habilin at Testamento
executed by Juanito Rodriguez on October 27, 1983; 2) Deed of Sale of the property executed by Juanito
Rodriguez and the petitioner on June 14, 1984; 3) TCT No. 150431 in the name of the petitioner; and 4)
the August 23, 1990 Partition Agreement executed by both the respondents and the petitioner.

Based on the foregoing documentary evidence, we find that there is preponderance of evidence in favor
of the petitioners claim. Respondents failed to prove their right of possession, as the Huling Habilin at
Testamento and the Partition Agreement have no legal effect since the will has not been probated. Before
any will can have force or validity it must be probated. This cannot be dispensed with and is a matter of
public policy.[18] Article 838 of the Civil Code mandates that [n]o will shall pass either real or personal
property unless it is proved and allowed in accordance with the Rules of Court. As the will was not
probated, the Partition Agreement which was executed pursuant thereto can not be given effect. Thus,
the fact that petitioner was a party to said agreement becomes immaterial in the determination of the
issue of possession.

Moreover, at the time the deed of sale was executed in favor of the petitioner, Juanito Rodriguez
remained the owner thereof since ownership would only pass to his heirs at the time of his death. Thus,
as owner of the property, he had the absolute right to dispose of it during his lifetime. Now, whether or
not the disposition was valid is an issue that can be resolved only in Civil Case No. 01-1641, an action
instituted by the respondents for that purpose.

We are, thus, left with the deed of sale and the certificate of title over the property to consider.

We agree with the RTC that a certificate of title is a conclusive evidence of ownership of the land described
therein; the validity of which shall not be subject to a collateral attack, especially in an ejectment case
which is summary in nature.

In Ross Rica Sales Center, Inc. v. Ong,[19] the Court held that:

The long settled rule is that the issue of ownership cannot be subject of a collateral attack.

In Apostol v. Court of Appeals, this Court had the occasion to clarify this:

. . . Under Section 48 of Presidential Decree No. 1529, a certificate of title shall not be subject to collateral
attack. It cannot be altered, modified or cancelled, except in a direct proceeding for that purpose in
accordance with law. The issue of the validity of the title of the respondents can only be assailed in an
action expressly instituted for that purpose. Whether or not the petitioners have the right to claim
ownership over the property is beyond the power of the court a quo to determine in an action for unlawful
detainer.

Further, in Co v. Militar,[20] it was held that:

[T]he Torrens System was adopted in this country because it was believed to be the most effective
measure to guarantee the integrity of land titles and to protect their indefeasibility once the claim of
ownership is established and recognized.

It is settled that a Torrens Certificate of title is indefeasible and binding upon the whole world unless and
until it has been nullified by a court of competent jurisdiction. Under existing statutory and decisional law,
the power to pass upon the validity of such certificate of title at the first instance properly belongs to the
Regional Trial Courts in a direct proceeding for cancellation of title.

As the registered owner, petitioner had a right to the possession of the property, which is one of the
attributes of ownership. X x x

We emphasize, however, that our ruling on the issue of ownership is only provisional to determine who
between the parties has the better right of possession. It is, therefore, not conclusive as to the issue of
ownership, which is the subject matter of Civil Case No. 01-1641. Our ruling that petitioner has a better
right of possession was arrived at on the basis of evidence without prejudice to the eventual outcome of
the annulment case, where the issue as to who has title to the property in question is fully threshed out.
As the law now stands, in an ejectment suit, the question of ownership may be provisionally ruled upon
for the sole purpose of determining who is entitled to possession de facto.

WHEREFORE, in view of the foregoing, the Decision of the Court of Appeals in CA-G.R. SP No. 91442 dated
June 27, 2006 is REVERSED and SET ASIDE. The Decision of the Regional Trial Court of Makati City, Branch
134, in Civil Case No. 03-517, reversing the Decision of the Metropolitan Trial Court (MTC) of Makati City,
Branch 63, in Civil Case No. 75717, is REINSTATED.

SO ORDERED.
Corpuz vs Agustin

DECISION

SERENO, J.:

This Petition for Review on Certiorari under Rule 45 of the Rules of Court assails the Decision[1] dated 08
January 2008 of the Court of Appeals (CA) in CA-G.R. SP No. 90645, which affirmed the Decision of the
Regional Trial Court (RTC) of Laoag City and its Resolution[2] dated 15 July 2008 denying the Motion for
Reconsideration. The RTC, in the exercise of its appellate jurisdiction, affirmed the Decision of the
Municipal Trial Court (MTC) of Laoag City, which had dismissed the unlawful detainer case filed by herein
petitioner.

The Factual Antecedents

The Court adopts the findings of fact of the CA as follows:

Ruben C. Corpuz (Ruben) filed a complaint for ejectment against Spouses Hilarion and Justa Agustin on
the allegation that he is the registered owner of two parcels of land located in Santa Joaquina, Laoag City
covered by TCT No. 12980 issued on October 29, 1976 by the Laoag City Register of Deeds and with
technical descriptions as follows:

1) A parcel of land (Lot No. 20 of the Cadastral Survey of Laoag), with improvements thereon,
situated in the barrio of Santa Joaquina, Municipality of Laoag. Bounded x x x containing an area
of five thousand seven hundred and fifty nine (5,759) square meters more or less x x x.
2) A parcel of land (Lot No. 11711 of the Cadastral Survey of Laoag), with the improvements
thereon, situated in the barrio of Santa Joaquina, Municipality of Laoag. Bounded x x x, containing
an area of twenty thousand seven hundred and forty five (20,745) square meters, more or less x
x x.

Aforesaid parcels of land were formerly owned by Elias Duldulao in whose name Original Certificate of
Title No. O-1717 was issued. Duldulao sold said properties on August 27, 1951 to Francisco D. Corpuz,
father of Ruben C. Corpuz. The elder Corpuz allowed spouses Agustin to occupy subject properties, the
latter being relatives.

Despite demand to vacate, the Agustins refused to leave the premises.

Ruben alleged further that he has the better right to possess subject property having acquired the same
from his father, Francisco, who executed a Deed of Quitclaim in his favor on March 15, 1971.

Spouses Agustin, in their Answer, interposed the defense that on June 5, 1971 Francisco Corpuz, Ruben’s
father, disposed of subject property by executing a Deed of Absolute Sale in their favor for a consideration
of Eleven Thousand One Hundred Fifty Pesos (P11,150.00).

The Municipal Trial Court found for the spouses Agustin and dismissed the complaint.

In sum, considering the evidence of the defendants which shows that they entered into and occupied Lot
No. 20 and the 9,657 sq. m. portion of Lot No. 11711 as buyers or owners, disproving the allegation of the
plaintiff that defendants were merely allowed by Francisco Corpuz to occupy the subject properties, being
his relatives, and considering further the length of time that the defendants have been in possession, as
owners, of Lot No. 20 and the 9,657 sq. m. portion of Lot No. 11711, and have been continuously
exercising their rights of ownership thereon, this court is of the view and holds, in so far as this case is
concerned, that the defendants are the ones entitled to the possession of Lot No. 20 and the 9,657 sq. m.
portion of Lot No. 11711

WHEREFORE, premises considered, this case, is hereby dismissed.

SO ORDERED.

On appeal, Branch XVI, Regional Trial Court of Laoag City affirmed said dismissal, the dispositive portion
of said decision states:

WHEREFORE, premises considered, the Appeal is hereby DISMISSED for lack of merit and the JUDGMENT
of the Municipal Trial Court in Cities, Branch 01, Laoag City is hereby AFFIRMED, with costs against the
plaintiff-appellant.

SO ORDERED.[3]

Petitioner assailed the Decision of the RTC, affirming the earlier dismissal of the case by the MTC, by
instituting an appeal with the CA. On 08 January 2008, the appellate court through its Fourteenth Division
dismissed his appeal.[4] It noted that his father engaged in a double sale when he conveyed the disputed
properties to petitioner and respondents. The Quitclaim executed by the elder Corpuz in favor of
petitioner was dated 15 March 1971, while the Deed of Sale with respondents was later, on 15 June 1971;
both documents were notarized shortly after their execution.[5] The Quitclaim, which was subsequently
inscribed at the back of Original Certificate of Title (OCT) No. O-1717 on 29 October 1976,[6] resulted in
the issuance of Transfer Certificate of Title (TCT) No. T-12980 in the name of petitioner. The Deed of Sale
executed with respondents was, however, not annotated at the back of OCT No. O-1717 and remained
unregistered.[7]

Based on the above findings, the CA ruled that petitioner had knowledge of the sale of the disputed real
property executed between Francisco Corpuz, petitioner’s father, and respondents. Due to this
conveyance by the elder Corpuz to respondents, the latter’s possession thereof was in the nature of
ownership. Thus, in the context of an unlawful detainer case instituted by petitioner against respondents,
the appellate court concluded that respondents possession of the property was not by mere tolerance of
its former owner petitioner’s father but was in the exercise of ownership.[8]

The CA noted that petitioner had knowledge of his fathers sale of the properties to respondents as early
as 1973. However, despite knowledge of the sale, petitioner failed to initiate any action to annul it and
oust respondents from the subject properties.[9] The appellate court rejected his contention that, as
registered owner of the disputed properties, he had a better right to possession thereof, compared to the
unregistered Deed of Sale relied upon by respondents in their defense of the same properties. The CA
ruled that the inaction on his part despite knowledge of the sale in 1973 was equivalent to registration of
respondents unregistered deed.[10] In dismissing his appeal, the CA concluded that respondents
possession was not … anchored on mere tolerance nor on any of the grounds for forcible entry or unlawful
detainer; hence the complaint for ejectment must fail.[11] The dispositive portion of the assailed Decision
reads:

WHEREFORE, in view of the foregoing, the instant petition is hereby DISMISSED. The decision of Branch
XVI, Regional Trial Court of Laoag City in Civil Case No. 13293-16 is hereby AFFIRMED.

SO ORDERED.[12]

The Issues

Petitioner assigns the following errors in this Petition for Review on Certiorari:

I. THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED IN FAILING TO CONSIDER THE

LEGAL OWNERSHIP OF PETITIONER ON THE DISPUTED PROPERTY TO CLAIM BETTER RIGHT TO
POSSESSION.
II. THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED IN THE APPRECIATION OF THE
ALLEGED SALE IN FAVOR OF RESPONDENTS TO RULE THAT THEY HAVE BETTER RIGHT TO
POSSESSION.
III. THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED IN FAILING TO CONSIDER THE
CASE OF JACINTO CO VS. MILITAR, ET AL. (421 SCRA 455) WHICH IS SIMILAR TO THE INSTANT
CASE.
IV. THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED IN DENYING THE PETITION FOR
REVIEW RAISED BEFORE IT.[13]

Petitioner presents to this Court for resolution the core issue of his Petition: who between the parties has
the right to possession of the disputed properties – petitioner, who is the registered owner under TCT No.
T-12980; or respondents, who have a notarized yet unregistered Deed of Absolute Sale over the same
properties?
The Court’s Ruling

We DENY the Petition.

Although this case does not present a novel question of law, there is a need to discuss the nature of an
ejectment case for the recovery of physical possession in relation to the Torrens system. A resolution of
the issue would be relevant to the determination of who has the better right to possession in this unlawful
detainer case.

One of the three kinds of action for the recovery of possession of real property is accion interdictal, or an
ejectment proceeding … which may be either that for forcible entry (detentacion) or unlawful detainer
(desahucio), which is a summary action for the recovery of physical possession where the dispossession
has not lasted for more than one year, and should be brought in the proper inferior court.[14] In ejectment
proceedings, the courts resolve the basic question of who is entitled to physical possession of the
premises, possession referring to possession de facto, and not possession de jure.[15]

Where the parties to an ejectment case raise the issue of ownership, the courts may pass upon that issue
to determine who between the parties has the better right to possess the property. However, where the
issue of ownership is inseparably linked to that of possession, adjudication of the ownership issue is not
final and binding, but only for the purpose of resolving the issue of possession. The adjudication of the
issue of ownership is only provisional, and not a bar to an action between the same parties involving title
to the property.[16]

In the instant case, the position of respondents is that they are occupying the disputed properties as
owners, having acquired these from petitioner’s father through a Deed of Absolute Sale executed in 1971.
Respondents believe that they cannot be dispossessed of the disputed properties, since they are the
owners and are in actual possession thereof up to this date. Petitioner, however, rebuts this claim of
ownership, contending that he has registered the disputed properties in his name and has been issued a
land title under the Torrens system. He asserts that, having registered the properties in his name, he is
the recognized owner and consequently has the better right to possession.

Indeed, a title issued under the Torrens system is entitled to all the attributes of property ownership,
which necessarily includes possession.[17] Petitioner is correct that as a Torrens title holder over the
subject properties, he is the rightful owner and is entitled to possession thereof. However, the lower
courts and the appellate court consistently found that possession of the disputed properties by
respondents was in the nature of ownership, and not by mere tolerance of the elder Corpuz. In fact, they
have been in continuous, open and notorious possession of the property for more than 30 years up to this
day.
Petitioner cites Jacinto Co v. Rizal Militar, et al.,[18] which has facts and legal issues identical to those of
the instant case. The petitioner therein filed an unlawful detainer case against the respondents over a
disputed property. He had a Torrens title thereto, while the respondents as actual occupants of the
property claimed ownership thereof based on their unregistered Deeds of Sale. The principal issue was
who between the two parties had the better right to possess the subject property.

This Court resolved the issue by upholding the title holder as the one who had the better right to
possession of the disputed property based on the following justification:

We have, time and again, held that the only issue for resolution in an unlawful detainer case is physical or
material possession of the property involved, independent of any claim of ownership by any of the party
litigants. Moreover, an ejectment suit is summary in nature and is not susceptible to circumvention by the
simple expedient of asserting ownership over the property.

In forcible entry and unlawful detainer cases, even if the defendant raises the question of ownership in
his pleadings and the question of possession cannot be resolved without deciding the issue of ownership,
the lower courts and the Court of Appeals, nonetheless, have the undoubted competence to provisionally
resolve the issue of ownership for the sole purpose of determining the issue of Possession.

Such decision, however, does not bind the title or affect the ownership of the land nor is conclusive of the
facts therein found in a case between the same parties upon a different cause of action involving
possession.

In the instant case, the evidence showed that as between the parties, it is the petitioner who has a Torrens
Title to the property. Respondents merely showed their unregistered deeds of sale in support of their
claims. The Metropolitan Trial Court correctly relied on the transfer certificate of title in the name of
petitioner.

In Tenio-Obsequio v. Court of Appeals, it was held that the Torrens System was adopted in this country
because it was believed to be the most effective measure to guarantee the integrity of land titles and to
protect their indefeasibility once the claim of ownership is established and recognized.

It is settled that a Torrens Certificate of title is indefeasible and binding upon the whole world unless and
until it has been nullified by a court of competent jurisdiction. Under existing statutory and decisional law,
the power to pass upon the validity of such certificate of title at the first instance properly belongs to the
Regional Trial Courts in a direct proceeding for cancellation of title.

As the registered owner, petitioner had a right to the possession of the property, which is one of the
attributes of his ownership. Respondents’ argument that petitioner is not an innocent purchaser for value
and was guilty of bad faith in having the subject land registered in his name is a collateral attack on the
title of petitioner, which is not allowed. A certificate of title cannot be subject to a collateral attack and
can be altered, modified or cancelled only in a direct proceeding in accordance with law. [19]
The pronouncement in Co v. Militar was later reiterated in Spouses Pascual v. Spouses Coronel[20] and in
Spouses Barias v. Heirs of Bartolome Boneo, et al.,[21] wherein we consistently held the age-old rule that
the person who has a Torrens Title over a land is entitled to possession thereof.[22]

However, we cannot lose sight of the fact that the present petitioner has instituted an unlawful detainer
case against respondents. It is an established fact that for more than three decades, the latter have been
in continuous possession of the subject property, which, as such, is in the concept of ownership and not
by mere tolerance of petitioners father. Under these circumstances, petitioner cannot simply oust
respondents from possession through the summary procedure of an ejectment proceeding.

Instructive on this matter is Carbonilla v. Abiera,[23] which reads thus:

Without a doubt, the registered owner of real property is entitled to its possession. However, the owner
cannot simply wrest possession thereof from whoever is in actual occupation of the property. To recover
possession, he must resort to the proper judicial remedy and, once he chooses what action to file, he is
required to satisfy the conditions necessary for such action to prosper.

In the present case, petitioner opted to file an ejectment case against respondents. Ejectment
casesforcible entry and unlawful detainerare summary proceedings designed to provide expeditious
means to protect actual possession or the right to possession of the property involved. The only question
that the courts resolve in ejectment proceedings is: who is entitled to the physical possession of the
premises, that is, to the possession de facto and not to the possession de jure. It does not even matter if
a partys title to the property is questionable. For this reason, an ejectment case will not necessarily be
decided in favor of one who has presented proof of ownership of the subject property. Key jurisdictional
facts constitutive of the particular ejectment case filed must be averred in the complaint and sufficiently
proven.

The statements in the complaint that respondents possession of the building was by mere tolerance of
petitioner clearly make out a case for unlawful detainer. Unlawful detainer involves the persons
withholding from another of the possession of the real property to which the latter is entitled, after the
expiration or termination of the formers right to hold possession under the contract, either expressed or
implied.

A requisite for a valid cause of action in an unlawful detainer case is that possession must be originally
lawful, and such possession must have turned unlawful only upon the expiration of the right to possess.
It must be shown that the possession was initially lawful; hence, the basis of such lawful possession must
be established. If, as in this case, the claim is that such possession is by mere tolerance of the plaintiff, the
acts of tolerance must be proved. (Emphasis supplied.)
In this case, petitioner has not proven that respondents continued possession of the subject properties
was by mere tolerance of his father, except by a mere allegation thereof. In fact, petitioner has not
established when respondents possession of the properties became unlawful a requisite for a valid cause
of action in an unlawful detainer case.

In Canlas v. Tubil,[24] we enumerated the elements that constitute the sufficiency of a complaint for
unlawful detainer, as follows:

Well-settled is the rule that what determines the nature of the action as well as the court which has
jurisdiction over the case are the allegations in the complaint. In ejectment cases, the complaint should
embody such statement of facts as to bring the party clearly within the class of cases for which the statutes
provide a remedy, as these proceedings are summary in nature. The complaint must show enough on its
face to give the court jurisdiction without resort to parol evidence.

Unlawful detainer is an action to recover possession of real property from one who illegally withholds
possession after the expiration or termination of his right to hold possession under any contract, express
or implied. The possession of the defendant in unlawful detainer is originally legal but became illegal due
to the expiration or termination of the right to possess.

An unlawful detainer proceeding is summary in nature, jurisdiction of which lies in the proper municipal
trial court or metropolitan trial court. The action must be brought within one year from the date of last
demand and the issue in said case is the right to physical possession.

In Cabrera v. Getaruela, the Court held that a complaint sufficiently alleges a cause of action for unlawful
detainer if it recites the following:

(1) Initially, possession of property by the defendant was by contract with or by tolerance of the
plaintiff;
(2) Eventually, such possession became illegal upon notice by plaintiff to defendant of the
termination of the latters right of possession;
(3) Thereafter, the defendant remained in possession of the property and deprived the plaintiff of
the enjoyment thereof; and
(4) Within one year from the last demand on defendant to vacate the property, the plaintiff
instituted the complaint for ejectment.

Based on the above, it is obvious that petitioner has not complied with the requirements sufficient to
warrant the success of his unlawful detainer Complaint against respondents. The lower courts and the CA
have consistently upheld the entitlement of respondents to continued possession of the subject
properties, since their possession has been established as one in the concept of ownership. Thus, the
courts correctly dismissed the unlawful detainer case of petitioner.
We concur in the appellate courts findings that petitioners father engaged in a double sale of the disputed
properties. The records of the case show that it took petitioner more or less five years from 1971 when
he acquired the property from his father to 1976 when petitioner registered the conveyance and caused
the issuance of the land title registered in his name under the Torrens system. Respondents, on the other
hand, continued their possession of the properties, but without bothering to register them or to initiate
any action to fortify their ownership.

We cannot, however, sustain the appellate courts conclusion that petitioner’s failure to initiate any action
to annul the sale to respondents and oust them from the disputed properties had the effect of registration
of respondents unregistered Deed of Absolute Sale. We held thus in Ruiz, Sr. v. Court of Appeals [25]:

(But) where a party has knowledge of a prior existing interest which is unregistered at that time he
acquired a right to the same land, his knowledge of that prior unregistered interest has the effect of
registration as to him. Knowledge of an unregistered sale is equivalent to registration. As held in
Fernandez v. Court of Appeals [189 SCRA 780 (1990)],

Section 50 of Act No. 496 (now Sec. 51 of P.D. 1529), provides that the registration of the deed is the
operative act to bind or affect the land insofar as third persons are concerned. But where the party has
knowledge of a prior existing interest which is unregistered at the time he acquired a right to the same
land, his knowledge of that prior unregistered interest has the effect of registration as to him. The Torrens
system cannot be used as a shield for the commission of fraud (Gustillo v. Maravilla, 48 Phil. 442).
[Emphasis supplied.]

In this case, the Quitclaim executed by the elder Corpuz in favor of petitioner was executed ahead of the
Deed of Sale of respondents. Thus, the sale of the subject properties by petitioners father to respondents
cannot be considered as a prior interest at the time that petitioner came to know of the transaction.

We also note that, based on the records, respondents do not dispute the existence of TCT No. T-12980
registered in the name of petitioner. They allege, though, that the land title issued to him was an act of
fraud [26] on his part. We find this argument to be equivalent to a collateral attack against the Torrens
title of petitioner an attack we cannot allow in the instant unlawful detainer case.

It is settled in jurisprudence that a Torrens certificate of title cannot be the subject of collateral attack.[27]
Such attack must be direct and not by a collateral proceeding.[28] It is a well-established doctrine that the
title represented by the certificate cannot be changed, altered, modified, enlarged, or diminished in a
collateral proceeding.[29] Considering that this is an unlawful detainer case wherein the sole issue to be
decided is possession de facto rather than possession de jure, a collateral attack by herein respondents
on petitioner’s title is proscribed.
Our ruling in the present case is only to resolve the issue of who has the better right to possession in
relation to the issue of disputed ownership of the subject properties. Questions as to the validity of
petitioner’s Torrens title can be ventilated in a proper suit instituted to directly attack its validity, an issue
that we cannot resolve definitively in this unlawful detainer case.

WHEREFORE, in view of the foregoing, we deny the instant Petition for lack of merit. The Decisions of the
Court of Appeals in CA-G.R. SP No. 90645 (dated January 08, 2008), of the Regional Trial Court of Laoag
City in Civil Case No. 3111-13293-65, as well as of the Municipal Trial Court of Laoag City in Civil Case No.
3111 – all dismissing the unlawful detainer case of petitioner are AFFIRMED.

We make no pronouncements as to attorney’s fees for lack of evidence.

SO ORDERED.

G.R. No. 191432, September 02, 2015

TERESA D. TUAZON, Petitioner, v. SPOUSES ANGEL AND MARCOSA

ISAGON, Respondents.

DECISION

BRION, J.:

We resolve the petition for review on certiorari filed by petitioner Teresa Tuazon (Teresa) to challenge the
October 28, 2009 Decision and February 11, 2010 Resolution of the Court of Appeals in CA-G.R. SP No.
107937, penned by Associate Justice Marlene Gonzales-Sison with Associate Justices Andres B. Reyes, Jr.
and Vicente S.E. Veloso, concurring.

The Facts

During their lifetime, spouses Melencio Diaz and Dolores Gulay (Dolores) owned Lot 103 of the Santa Rosa
Estate, Barangay Aplaya, Sta. Rosa, Laguna, consisting of 499 square meters (Lot 103). They had three
daughters named Maria, Paciencia, and Esperanza. Melencio and Maria predeceased Dolores. On May 28,
1955, Dolores, Paciencia, and Esperanza adjudicated Lot 103 to Dolores through a Deed of Extrajudicial
Settlement. Maria's children who were still minors at that time were not included in the settlement.

On March 17, 1956, Dolores sold Lot 103 to Isabel Torres through a Bilihang Tuluyan (Deed of Absolute
Sale). Subsequently, Isabel Torres sold Lot 103 to Teresa on September 29, 1973.

On October 12, 1973, Maria's children, namely Gloria, Angel, Felix, and Flaviano, all surnamed Isagon,
executed a Deed of Conformity. In this instrument, they honored the Deed of Extrajudicial Settlement
executed by their grandmother and aunts, subject to the condition that they would get one-sixth of Lot 103
as their share.

Gloria, Felix, and Flaviano also sold their.shares to Teresa. On the other hand, Angel mortgaged his share
to Teresa on October 20, 1975, through a Kasulatan ng Sanglaan. His share consisted of 20.75 square
meters which was one-fourth of the one-sixth share in the property. Angel Isagon thereafter refused and
failed to redeem the mortgaged property.

Teresa has been paying the real estate taxes due on Lot 103 since 1974 up to the present. Lot 103 is
covered by an undated and reconstituted Transfer Certificate of Title (TCT) No. (N.A.) RT-1925 issued
in Teresa's name.

Sometime in 1972, the petitioner's brother, Antonio Tuazon (Antonio), allowed Spouses Angel and Marcosa
Isagon (respondents) to build a small hut on a portion of Lot 103 without Teresa's knowledge. The
respondents and their children were then living by the seashore and Antonio feared that their house could
be swept away by the floods during a typhoon.

In 2000, the respondents started to construct a house on the disputed property despite Teresa's protest. For
years, however, Teresa tolerated their possession and use of the contested area.

In 2007, Teresa filed a complaint against the respondents before the Lupon
Tagapamayapa of Barangay Aplaya. The parties failed to reach any amicable settlement.

On January 24, 2007, Teresa sent a final demand letter to respondents to vacate and to pay rental fees. The
respondents did not reply.

On September 11, 2007, Teresa filed a complaint for unlawful detainer against the respondents before the
Municipal Trial Court in Cities (MTCC), City of Sta. Rosa, Laguna. She prayed that the respondents be
ordered to vacate the subject property and to pay compensation for its use and occupancy.

In their answer, the respondents alleged that they were occupying the subject property as owners. They
also alleged that Teresa fraudulently obtained TCT No. (N.A.) RT-1925.

The MTCC and RTC Rulings

The MTCC, in its judgment on January 25, 2008, decided in favor of Teresa and ordered the respondents to
vacate the subject property and to pay reasonable rent and attorney's fees. The MTCC held that Teresa was
the owner of the property as shown by TCT No. (N.A.) RT-1925, and as owner, she was entitled to enjoy the
right of possession over the subject property. It added that a property registered under the Torrens system
could not be collaterally attacked in an action for unlawful retainer.

On appeal, the Regional Trial Court (RTC) in Bifian, Laguna, affirmed in toto the decision of the MTCC. The
RTC denied the respondents' motion for reconsideration.

The CA Ruling

The respondents appealed the RTC's ruling to the CA.

In its October 28, 2009 Decision, the CA reversed the RTC's ruling. The CA noted that Angel Isagon
executed a real estate mortgage in favor of Teresa over a portion of Lot 103 but had failed to redeem it.
Citing Article 2088 of the Civil Code, the CA concluded that Teresa was a mere mortgagee and had no right
to eject the respondents. Instead of foreclosing the property, Teresa filed this action for unlawful detainer.
The CA added that a mortgage was not an instrument that transferred ownership; thus, the disputed
property still belonged to the respondents.

The Petition

Teresa's present petition for review on certiorari argues that she is the registered owner, not a mere
mortgagee, of the property as shown by TCT No. (N.A.) RT-1925. Section 51 of Presidential Decree No.
1929 expressly states that registration is the operative act that conveys registered land. Thus, the TCT is
the best proof of ownership.

She adds that the only issue in an unlawful detainer case is the physical possession of the property. As the
registered owner, she has the right to enjoy all the rights of an owner under Articles 428 and 429 of the Civil
Code, including actual possession.

Our Ruling

We grant the petition.

The sole issue here is who has the better right of physical possession between the registered owner as
shown in the certificate of title and the mortgagor as shown in the Kasulatan ng Sanglaan.

While the CA is correct that a mortgage does not transfer ownership, the indefeasibility of a Torrens title
should have been given primary consideration.

An action for unlawful detainer is summary in nature and cannot be delayed by a mere assertion of
ownership as a defense.1 When the parties to an ejectment case raise the issue of ownership, the court may
pass upon that issue only if needed to determine who between the parties has a better right to possess the
property.2 Furthermore, the adjudication on the issue of ownership is only provisional,3 and subject to a
separate proceeding that the parties may initiate to settle the issue of ownership.

A person who possesses a title issued under the Torrens system is entitled to all the attributes of ownership
including possession.4 A certificate of title cannot be subject to a collateral attack in an action for unlawful
detainer. A collateral attack is made when, in an action to obtain a different relief, the validity of a certificate
of title is questioned.5

In the present case, the respondents alleged in their answer that the certificate of title issued in the name of
Teresa was fraudulently obtained. This defense constitutes a collateral attack on the title and should not
therefore be entertained. To directly assail the validity of TCT No. (N.A.) RT-1925, a direct action for
reconveyance must be filed.6

In the present case, based on the certificate of title, Teresa is the owner of the subject property and is
entitled to its physical possession.

WHEREFORE, we hereby GRANT the petition for review on certiorari. The Decision dated October 28,
2009, and the Resolution dated February 11, 2010, of the Court of Appeals in CA-G.R. SP No. 107937 are
hereby REVERSED and SET ASIDE. The decision dated October 15, 2008, of Branch 25 of the Regional
Trial Court, Bi�an, Laguna, in Civil Case No. B-7472, is hereby REINSTATED.

SO ORDERED