Remedy of the true owner or the aggrieved party

1. Direct attack on title

It is settled in this jurisdiction that the issue of the validity of title can only be
assailed in an action expressly instituted for such purpose. A certificate of title
cannot be attacked collaterally. This rule is provided under Section 48 of PD
1529 which states that:[49]
Section 48. Certificate not subject to collateral attack. ― A certificate of title
shall not be subject to collateral attack. It cannot be altered, modified, or
cancelled except in a direct proceeding in accordance with law.
In Lagrosa v. Court of Appeals[50], it was stated that it is a well-known doctrine
that the issue as to whether title was procured by falsification or fraud as
advanced by petitioner can only be raised in an action expressly instituted for
the purpose. A Torrens title can be attacked only for fraud, within one
year after the date of the issuance of the decree of registration. Such attack must
be direct, and not by a collateral proceeding. The title represented by the
certificate cannot be changed, altered, modified, enlarged, or diminished in a
collateral proceeding. In Carvajal v. Court of Appeals[51], it was ruled that an
application for registration of an already titled land constitutes a collateral attack
on the existing title. The title may be challenged only in a proceeding for that
purpose, not in an application for registration of a land already registered in the
name of another person. After one year from its registration, the title is
incontrovertible and is no longer open to review.[52]
2. Action for reconveyance
After the lapse of one year, a decree of registration is no longer open to review
or attack, although its issuance is attended with fraud.[53] This does not mean,
however, that the aggrieved party is without remedy at law. If the property has
not as yet passed to an innocent purchaser for value, an action for reconveyance
is still available. The sole remedy of the land owner whose property has been
wrongfully or erroneously registered in another’s name is, after one year from
the date of the decree, not to set aside the decree, but, respecting the decree as
incontrovertible and no longer open to review, to bring an ordinary action in the
ordinary court of justice for reconveyance or, if the property has passed into the
hands of an innocent purchaser for value, for damages.[54]
It has been held that an original owner of registered land may seek annulment of
the transfer thereof on the ground of fraud and the proper remedy is
reconveyance.[55] An action for reconveyance is a legal and equitable remedy
that seeks to transfer or reconvey property, wrongfully registered in another
person’s name, to its rightful owner. To warrant reconveyance of the land, the
 plaintiff must allege and prove, among others, ownership of the land in dispute
and the defendant’s erroneous, fraudulent or wrongful registration of the
property.[56] In the action for reconveyance, the decree of registration is highly
respected as incontrovertible; what is sought instead is the transfer of the
property wrongfully or erroneously registered in another’s name to its rightful
owner or to the one with a better right.[57]
In New Regent Sources, Inc. v. Tanjuatco[58], the Court enumerated the four
requisites that must concur for an action for reconveyance to prosper, to wit:
“To warrant a reconveyance of the land, the following requisites must
concur: (1) the action must be brought in the name of a person claiming
ownership or dominical right over the land registered in the name of the
defendant; (2) the registration of the land in the name of the defendant was
procured through fraud or other illegal means; (3) the property has not yet
passed to an innocent purchaser for value; and (4) the action is filed after the
certificate of title had already become final and incontrovertible but within four
years from the discovery of the fraud or not later than 10 years in the case of an
implied trust. x x x.”

Reconveyance is based on Section 53 of P.D. 1529 which provides that in all

cases of registration procured by fraud, the owner may pursue all his legal and
equitable remedies against the parties to such fraud without prejudice, however,
to the rights of any innocent holder for value of a certificate of title. In civil law,
the basis of an action for reconveyance is the trust created by virtue of Art. 1456
of the Civil Code which provides that a person acquiring property through fraud
becomes by operation of law a trustee of an implied trust for the benefit of the
real owner of the property. The presence of fraud creates an implied trust in
favor of the plaintiffs, giving them the right to seek reconveyance of the
property from the private respondents. The aggrieved party may file an action
for reconveyance based on implied or constructive trust, which prescribes in ten
years from the date of the issuance of the Certificate of Title over the property
provided that the property has not been acquired by an innocent purchaser for
value.[59]
While it is true that an action for reconveyance can prescribe or can be barred
by statute of limitations, an action for reconveyance based on a void contract is
imprescriptible.[60] Thus, the action based on a fictitious, fraudulent or forged
deed may be brought by the aggrieved party at any time.[61]
3. Action for damages
 When the property has already passed into the hands of an innocent purchaser
for value, an action for reconveyance is no longer appropriate. This is so
because as a rule, a purchaser in good faith is an exception to the general rule
that a forged deed conveys no title. Nonetheless, the true owner is not without
recourse. He can still file an action for damages against the person/s responsible
for his loss of right or interest in his property.

A certificate of title issued to an innocent purchaser and for value cannot be

revoked on the ground that the deed of sale was falsified, if he had no
knowledge of the fraud committed. The recourse of the person prejudiced is to
bring an action for damages against those who caused or employed the
fraud.[62] The Court cannot disregard the rights of an innocent purchaser for
value and order the total cancellation of the certificate for that would impair
public confidence in the certificate of title.[63]
An action for damages should be brought within ten years from the date of
issuance of the questioned certificate of title pursuant to Article 1144 of the
Civil Code.[64]
4. Cancellation of title
An action for cancellation of title is applicable where there are two titles issued
to different persons for the same lot. Where the same parcel of land is covered
by two titles, necessarily when one of the two titles is held to be superior over
the other, the latter should be declared null and void and should be
cancelled.[65] In case of forgery, this rule contemplates a situation where the
true owner despite retaining possession of his duplicate certificate, through
fraud, another person succeeded in selling the property in his favor and another
certificate of title was issued as a result thereof.[66]
The general rule is that where two certificates of title are issued to different
persons covering the same land in whole or in part, the earlier date must prevail
as between the original parties, and in case of successive registration where
more than one certificate is issued over the land, the person holding under the
prior certificate is entitled to the land as against the person who relies on the
second certificate.[67] This principle is based on the maxim prior est in
tempore, potior est in jure(first in time, stronger in right) which is being
followed in our jurisdiction in land registration matters.[68]
It should be noted also that an action for cancellation of title is not an attack on
the title. An action or proceeding is deemed an attack on a title when its
objective is to nullify the title, thereby challenging the judgment pursuant to
which the title was decreed. The attack is direct when the objective is to annul
or set aside such judgment, or enjoin its enforcement. On the other hand, the
attack is indirect or collateral when, in an action to obtain a different relief, an
attack on the judgment is nevertheless made as an incident thereof.[69]
With respect to the aggrieved party however, the Court ruled in Gatioan v.
Gaffud[70] that the purchaser from the owner of the later certificate and his
successors, should resort to his vendor for redress, rather than molest the holder
of the first certificate and his successors, who should be permitted to rest secure
their title.
___________________________________________

The remedy of reconveyance, based on Section 53 of P.D. No. 1529 and Article 1456, prescribes in
ten (10) years from the issuance of the Torrens title over the property.

In the same vein, in Quiñiano, et al. v. Court of Appeals, et al., we stressed that:

The controlling legal norm was set forth in succinct language by Justice Tuason in a 1953 decision,
Director of Lands v. Register of Deeds of Rizal. Thus: "The sole remedy of the land owner whose
property has been wrongfully or erroneously registered in another's name is, after one year from the
date of the decree, not to set aside the decree, as was done in the instant case, but, respecting the
decree as incontrovertible and no longer open to review, to bring an ordinary action in the ordinary
court of justice for reconveyance or, if the property has passed into the hands of an innocent
purchaser for value, for damages." Such a doctrine goes back to the 1919 landmark decision of
Cabanos v. Register of Deeds of Laguna. If it were otherwise the institution of registration would, to
quote from Justice Torres, serve "as a protecting mantle to cover and shelter bad faith ...." In the
language of the then Justice, later Chief Justice, Bengzon: "A different view would encourage fraud
and permit one person unjustly to enrich himself at the expense of another." It would indeed be a
signal failing of any legal system if under the circumstances disclosed, the aggrieved party is
considered as having lost his right to a property to which he is entitled. It is one thing to protect an
innocent third party; it is entirely a different matter, and one devoid of justification, if [deceit] would be
rewarded by allowing the perpetrator to enjoy the fruits of his nefarious deed. As clearly revealed by
the undeviating line of decisions coming from this Court, such an undesirable eventuality is precisely
sought to be guarded against. So it has been before; so it should continue to be. (Citations omitted)

In this case, in filing the complaint for reconveyance and recovery of possession, Hortizuela was not
seeking a reconsideration of the granting of the patent or the decree issued in the registration
proceedings. What she was seeking was the reconveyance of the subject property on account of the
fraud committed by respondent Gregoria. An action for reconveyance is a legal and equitable
remedy granted to the rightful landowner, whose land was wrongfully or erroneously registered in the
name of another, to compel the registered owner to transfer or reconvey the land to him.25 Thus, the
RTC did not err in upholding the right of Hortizuela to ask for the reconveyance of the subject
property. To hold otherwise would be to make the Torrens system a shield for the commission of
fraud. To reiterate,

The fact that petitioner was able to secure a title in her name did not operate to vest ownership upon
her of the subject land. Registration of a piece of land under the Torrens System does not create or
1âwphi1

vest title, because it is not a mode of acquiring ownership. A certificate of title is merely an evidence
of ownership or title over the particular property described therein. It cannot be used to protect a
usurper from the true owner; nor can it be used as a shield for the commission of fraud; neither does
it permit one to enrich himself at the expense of others. Its issuance in favor of a particular person
does not foreclose the possibility that the real property may be co-owned with persons not named in
the certificate, or that it may be held in trust for another person by the registered owner.26

G.R. No. 205867 February 23, 2015

MARIFLOR T. HORTIZUELA, represented by JOVIER TAGUFA, Petitioner,

vs.
GREGORIA TAGUFA, ROBERTO TAGUFA and ROGELIO LUMABAN, Respondents.

No prescriptive period
When parcels of land have been acquired through fraud, an action for re-conveyance
may be filed within four (4) years from discovery of fraud. If an implied or
constructive trust is created by such acquisition, the action prescribes in ten (10)
years. But is there an instance when the action for re-conveyance will not prescribe?
This is answered in this case between Ester and her nephew Pete, a lawyer,

The case involved three parcels of land: lots 3244 and 1404 covered by Original
Certificate of Title (OCT) Nos. 484 and 1482 respectively, registered in the names of
the children and heirs of Matilde, namely, Mila, Juan, Tino and Ipe at 1/4 undivided
share each; and lot 3246 covered by OCT No. 368 registered collectively in the name
of the “Heirs of Matilde”.

Mila, Juan, Tino and Ipe had all died. Surviving them are their children and
descendants particularly the protagonists in this case, Ester and Pete who are the
daughter and grandson of Juan.

Since 1965, Ester had occupied lot 1404 where she built her house and was collecting
the rentals from the tenants of lots 3244 and 3246. To further protect her rights and
interest on the three lots as heir of her father Juan, she registered her adverse claims
on the titles to the lots although said claim was annotated only on the titles to lots
3244 and 1404.

Ester continued in possession of the properties although in 1983, Pete tried to prohibit
her from collecting the rentals from the tenants of lots 3244 and 3246. Then in
December, 1983, he filed a suit for recovery of possession of said lots from Ester and
another suit for unlawful detainer of lot 1404 where Ester was staying. While the
lower courts ruled in favor of Pete, the Court of Appeals reversed the RTC decision
and ruled in favor of Ester. Hence, Pete never took possession of the properties.
In 1988, upon verification from the Register of Deeds, Ester discovered that Pete had
already executed an “Affidavit of Adjudication” way back on April 17, 1974 wherein
he declared that he was the sole surviving heir of the registered owners of the three
lots and thus he adjudicated them unto himself. Based on this Affidavit of
Adjudication, Pete was able to obtain title to the lots. Then on May 10, 1974, the same
day he obtained titles to lots 3244 and 1404, he sold them to Cario so a new title was
issued in the name of Cario. Again on March 30, 1979 or two days after he obtained
title to lot 3246, Pete also sold the same to Tony. On the same day, Cario also sold to
Tony lots 3244 and 1404. Subsequently however, Tony sold back to Pete all the three
lots.

So on October 2, 1990, Ester filed a complaint before the RTC against her nephew
Pete for re-conveyance of the titles to the lots and for damages. She claimed that the
Affidavit of Adjudication was null and void ab initio because of the untruthful
statements therein knowingly and willfully made by Pete who knew that there were
still other living heirs entitled to the said properties. If at all, Ester alleged that Pete
was holding the titles as trustee in an implied or constructive trust. So Ester asked that
the titles be reverted back to its original registered owners: lots 3244 and 1404 in the
names of Mila, Juan, Tino and Ipe, pro indiviso and lot 3246 in the name of the “heirs
of Matilde”.

After trial, the RTC ruled in favor of Pete on the ground that when the complaint was
filed on October 2, 1990 prescription has already set in. The RTC, as affirmed
subsequently by the Court of Appeals, (CA) declared that when an action for re-
conveyance is based on fraud , it must be filed within 4 years from discovery of fraud,
and such discovery is deemed to have taken place when the affidavit of adjudication
was registered and the titles were issued in the name of Pete on May 10, 1974. On the
other hand an action for re-conveyance based on implied or constructive trust
prescribes in 10 years from such date. In this case some 16 years have already passed
since the Affidavit of Adjudication was registered with the register of deeds on May
10, 1974. So the action has already prescribed. Were the RTC and the CA correct?

No. The action for re-conveyance can indeed be barred by prescription in 4 years or
10 years as the case may be. But when the plaintiff (Ester, in this case) is still in actual
possession of the disputed lands, the period of prescription does not run. The action
for re-conveyance here becomes in effect an action to quiet title, which is not subject
to prescription.

One who is in 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 the
right to seek the aid of the court of equity at any time, to determine the nature of the
claim of a another party and its effect on his own title, which right can be claimed
only by one who is in possession.

In this case Ester’s possession was disturbed in 1983 when Pete filed a case for
recovery of possession and a case for unlawful detainer. But Ester never lost
possession because the court eventually ruled in her favor on said cases. As such she
is in a position to file this action to protect her rights and clear whatever doubts have
been cast on her title by the issuance of the TCTs in Pete’s name (Yared etc, vs.
Tiongco and Doronila, Jr. G.R. 161360, October 14, 2011)

An action for reconveyance on the ground that the certificate of title was obtained by means of a
fictitious or forged deed of sale is virtually an action for the declaration of the nullity of the forged
deed, hence, it does not prescribe.

"the essence of an action for reconveyance is that the decree of registration is respected as
incontrovertible but what is sought instead is the transfer of the property which has been wrongfully
or erroneously registered in another person’s name, to its rightful owner or to one with a better right."

Mentioned in G.R. No. 173186

ANICETO UY, Petitioner,

vs.
COURT OF APPEALS, MINDANAO STATION, CAGAYAN DE ORO CITY, CARMENCITA
NAVAL-SAI, REP. BY HER ATTORNEY-INFACT RODOLFO FLORENTINO, Respondents.

__________________________________________________________________
An action for reconveyance is a legal and equitable remedy granted to the rightful owner of land
which has been wrongfully or erroneously registered in the name of another for the purpose of
compelling the latter to transfer or reconvey the land to him.40 In an action for reconveyance, the
decree of registration is respected as incontrovertible. What is sought instead is the transfer of the
property, which has been wrongfully or erroneously registered in another person’s name, to its
rightful and legal owner, or to one with a better right.41However, such recourse cannot be availed of
once the property has passed to an innocent purchaser for value. For an action for reconveyance to
prosper, the property should not have passed into the hands of an innocent purchaser for value.42

An action for reconveyanceis basedon Section 53, paragraph 3 of Presidential Decree (PD) No.
1529,43 which provides:

In all cases of registration procured by fraud, the owner may pursue all his legal and equitable
remedies against the parties to such fraud without prejudice, however, to the rights of any innocent
holder for valueof a certificate of title. x x x

In Caro v. Court of Appeals,44 we said that this provision should be read in conjunction with Article
1456 of the Civil Code, which provides:
Article 1456. If property is acquired through mistake or fraud, the person obtaining it is, by force of
law, considered a trustee of an implied trust for the benefit of the person from whom the property
comes.

The law creates the obligation of the trustee to reconvey the property and its title in favor of the true
owner. Correlating Section 53, paragraph 3 of PD No. 1529 and Article 1456 of the Civil Code with
Article 1144 (2) of the Civil Code,45 the prescriptive period for the reconveyance of fraudulently
registered real property is ten (10) years reckoned from the date of the issuance of the certificate of
title.46 This ten-year prescriptive period begins to run from the date the adverse party repudiates the
implied trust, which repudiation takes place when the adverse party registers the land.47 An exception
to this rule is when the party seeking reconveyance based on implied or constructive trust is in
actual, continuous and peaceful possession of the property involved.48 Prescription does not
commence to run against him because the action would be in the nature of a suit for quieting of title,
an action that is imprescriptible.49

The foregoing cases on the prescriptibility of actions for reconveyanceapply when the action is
based on fraud, or when the contract used as basis for the action is voidable. Under Article 1390 of
the Civil Code, a contract is voidable when the consent of one of the contracting parties is vitiated by
mistake, violence, intimidation, undue influence or fraud. When the consent is totally absent and not
merely vitiated, the contract is void.50An action for reconveyance may also be based on a void
contract.51When the action for reconveyance is based on a void contract, as when there was no
consent on the part of the alleged vendor, the action is imprescriptible.52The property may be
reconveyed to the true owner, notwithstanding the TCTs already issued in another’s name. The
issuance of a certificate of title in the latter’s favor could not vest upon him or her ownership of the
property; neither could it validate the purchase thereof which is null and void. Registration does not
vest title; it is merely the evidence of such title. Our land registration laws do not give the holder any
better title than what he actually has. Being null and void, the sale produces no legal effects
whatsoever.53

Whether an action for reconveyance prescribes or not is therefore determined by the nature of the
action, that is, whether it is founded on a claim of the existence of an implied or constructive trust, or
one based on the existence of a void or inexistent contract.

There is no dispute that an action for reconveyance based on a void contract is imprescriptible
(Castillo, et al. v. Madrigal, et al., G.R. No. 62650, June 27, 1991; Baranda, et al. v. Baranda, et al.,
G.R. No. 73275, May 20, 1987, 150 SCRA 59).

An action for reconveyance based on a void contract is imprescriptible. As long as the land
wrongfully registered under the Torrens system is still in the name of the person who caused such
registration, an action in personam will lie to compel him to reconvey the property to the real
owner.57 (Citations omitted)

In Santos v. Heirs of DomingaLustre,58 the complaint alleged that the deed of sale was simulated by
forging the signature of the original registered owner. We ruled in favor of imprescribility applying the
doctrine that the action for reconveyance on the ground that the certificate of title was obtained by
means of a fictitious deed of sale is virtually an action for the declaration of its nullity, which does not
prescribe.

Hi-Tone Marketing Corporation v. Baikal Realty Corporation, G.R. No. 149992, August 20, 2004,
40

437 SCRA 121, 143.

41
Id., citing Walstrom v. Mapa, Jr., G.R. No. 38387, January 29, 1990, 181 SCRA 431, 442.
 Philippine Economic Zone Authority v. Fernandez, G.R. No. 138971, June 6, 2001, 358 SCRA 489,
42

499.

43
Otherwise known as the Property Registration Decree.

44
G.R. No. 76148, December 20, 1989, 180 SCRA 401, 407.

ART. 1144. The following actions must be brought within ten years from the time the right of action
45

accrues:

(1) Upon a written contract;

(2) Upon an obligation created by law;

(3) Upon a judgment.

46
Id.

47
Crisostomo v. Garcia, Jr., G.R. No. 164787, January 31, 2006, 481 SCRA 402; Salvatierra v. Court
of Appeals, G.R. No. 107797, August 26, 1996, 261 SCRA 45; Amerol v. Bagumbaran, G.R. No. L-
33261, September 30, 1987, 154 SCRA 396.

48
Vda.de Gualberto v. Go, G.R. No. 139843, July 21, 2005, 463 SCRA 671, 681.

49
Brito, Sr. v. Dianala, G.R. No. 171717, December 15, 2010, 638 SCRA 529, 538.

50
ART.1318. There is no contract unless the following requisites concur:

(1) Consent of the contracting parties;

(2) Object certain which is the subject matter of the contract;

(3) Cause of the obligation which is established.

51
Amado D. Aquino, Land Registration and Related Proceedings, p. 133, 4th Ed., 2007.

52
Id. at 136.

53
Macababbad, Jr. v. Masirag,G.R. No. 161237, January 14, 2009, 576 SCRA 70, 86.

54
G.R. No. 96829, December 9, 1991, 204 SCRA 684, 693.

55
Id.