HEIRS OF BIENVENIDO AND G.R. No.

Sometime in 1979, Jose Gabriel, father of

ARACELI TANYAG, namely: 175763 respondents, secured in his name Lot 1 indicating therein an
ARTURO TANYAG, AIDA T. increased area of 1,763 square meters.
JOCSON AND ZENAIDA T. Present:
VELOSO, On March 20, 2000, petitioners instituted a civil case
Petitioners, CORONA, C.J alleging that respondents never occupied the whole 686
., square meters of Lot 1 and fraudulently caused the inclusion
Chairpe of Lot 2 in such that Lot 1 consisting of 686 square meters
- versus - rson, originally declared in the name of Jose Gabriel was increased
LEONARDO- to 1,763 square meters. They contended that the issuance of
DE CASTRO,
OCT No. 1035 on October 28, 1998 over the subject land in
BERSAMIN,
the name of respondent’s heirs of Jose Gabriel was null and
DEL
CASTILLO, and void from the beginning.
VILLARAMA
On the other hand, respondents asserted that
, JR., JJ.
petitioners have no cause of action against them for they
SALOME E. GABRIEL, have not established their ownership over the subject
NESTOR R. GABRIEL, LUZ Promulgated: property covered by a Torrens title in respondents’
GABRIEL-ARNEDO married to name. They further argued that OCT No. 1035 had become
ARTURO ARNEDO, NORA April 11, 2012 unassailable one year after its issuance and petitioners failed
GABRIEL-CALINGO to establish that it was irregularly or unlawfully procured.
married to FELIX CALINGO,
PILAR M. MENDIOLA, Issue:
MINERVA GABRIEL-
NATIVIDAD married to Who has a better right over the subject property?
EUSTAQUIO NATIVIDAD, and
ERLINDA VELASQUEZ Ruling:
married to HERMINIO
VELASQUEZ, From 1969 until the filing of this complaint by
Respondents. the petitioners in March 2000, the latter have been in
continuous, public and adverse possession of the subject land
for 31 years. Having possessed the property for the period
and in the character required by law as sufficient for
Facts: extraordinary acquisitive prescription, petitioners have
indeed acquired ownership over the subject property. Such
Subject of controversy are two adjacent parcels of land right cannot be defeated by respondents’ acts of declaring
located at Ruhale, Barangay Calzada, Municipality of again the property for tax purposes in 1979 and obtaining a
Taguig. The first parcel (“Lot 1”) with an area of 686 square Torrens certificate of title in their name in 1998.
meters was originally declared in the name of Jose Gabriel,
while the second parcel (“Lot 2”) consisting of 147 square Under Article 434 of the Civil Code, to successfully
meters was originally declared in the name of Agueda maintain an action to recover the ownership of a real
Dinguinbayan. For several years, these lands lined with property, the person who claims a better right to it must
bamboo plants remained undeveloped and uninhabited. prove two (2) things: first, the identity of the land claimed;
and second, his title thereto. In regard to the first requisite,
Petitioners claimed that Lot 1 was owned by Benita in an accion reinvindicatoria, the person who claims that he
Gabriel, sister of Jose Gabriel, as part of her inheritance as has a better right to the property must first fix the identity of
declared by her in a 1944 notarized instrument (“Affidavit of the land he is claiming by describing the location, area and
Sale”) whereby she sold the said property to spouses Gabriel boundaries thereof. In this case, petitioners failed to identify
Sulit and Cornelia Sanga. Lot 2 by providing evidence of the metes and bounds thereof,
so that the same may be compared with the technical
Lot 1 allegedly came into the possession of Benita description contained in OCT No. 1035, which would have
Gabriel’s own daughter, Florencia Gabriel Sulit, when her shown whether Lot 2 consisting of 147 square meters was
father-in-law Gabriel Sulit gave it to her as part of inheritance erroneously included in respondents’ title. The testimony of
of his son, Eliseo Sulit who was Florencia’s Agueda Dinguinbayan’s son would not suffice because said
husband. Florencia Sulit sold the same lot to Bienvenido S. witness merely stated the boundary owners as indicated in
Tanyag, father of petitioners, as evidenced by a notarized the 1966 and 1967 tax declarations of his mother. On his
deed of sale dated October 14, 1964. Petitioners then took part, Arturo Tayag claimed that he had the lots surveyed in
possession of the property, paid the real estate taxes due on the 1970s in preparation for the consolidation of the two
the land and declared the same for tax purposes issued in parcels. However, no such plan was presented in court.
1969 in the name of Bienvenido’s wife, Araceli C. Tanyag.

As to Lot 2, petitioners averred that it was sold by

Agueda Dinguinbayan to Araceli Tanyag under Deed of Sale
executed on October 22, 1968. Thereupon, petitioners took
possession of said property and declared the same for tax
purposes. Petitioners claimed to have continuously, publicly,
notoriously and adversely occupied both Lots 1 and 2 through
their caretaker Juana Quinones; they fenced the premises
and introduced improvements on the land.
Mechielle S. Salapang
Obligations & Contracts
Case Digest: Case No. 01
G.R. No. 200558
July 1, 2015
CONSUELO V. PANGASINAN and ANNABELLA V.
BORROMEO, Petitioners,
vs. CRISTINA DISONGLOALMAZORA, RENILDA ALMAZORA-
CASUBUAN, RODOLFO CASUBUAN, SUSANA
ALMAZORAMENDIOLA, CARLOS MENDIOLA, CECILIO
ALMAZORA and NENITA ALMAZORA, Respondents.
Facts of the Case:
This case concerns a parcel of land located at Brgy.
Sto. Domingo, Biñan, Laguna. It was registered in the name of
Aquilina Martinez (Aquilina) under Transfer Certificate of Title
(TCT) No. T-18729 by the Register of Deeds of Laguna on July
29, 1939.
In 1945, Aquilina and her grandmother Leoncia
rebuild their house located at Tondo, Manila by borrowing
money from Conrado. In return, Leoncia entrusted to
Conrado the owner’s ducplicate copy of the property in
Laguna, and Conrado and his family remained in the said
property.
Aquilina died in 1949 and the title of the said
property was transferred to Aurora. In 1972, Conrado also
passed away.
In 1994, Aurora learned from the widow of Conrado
that the title of the property in Laguna was long transferred
to Conrado and that it has been sold to Fullway Development
Corporation by the heirs of the same.
Aurora was shocked by the news and on October
1995, she sent an demand letter to the heirs of Conrado
demanding the delivery of the payment they received for the
sale of the property, but it was unheeded.
On May 1996, Aurora and her husband filed a
complaint for damages against Cristina and the heirs of
Conrado before the RTC. They said that the duplicate copy of
the TCT was given to Conrado for safekeeping. However, they
admitted that Conrado has been using the property since
1912 with the consent of Aquilina and Leoncia.
Aurora asserted that she had repeatedly asked
Conrado and then Cristina but she was ignored and that the
said property was sold to Fullway without her authorization.
On June 1996, respondents filed their answer with
compulsory counterclaim. They said that the subject property
was properly transferred to Conrado. They also raised the
defense that the complaint stated no cause of action and was
barred by prescription. RTC then ruled that the complaint
stated a cause of action.
Respondents filed a certiorari before the Court of
Appeals but was denied.
In RTC’s June 29, 2004 Decision, the complaint was
dismissed. It explained that Aurora was guilty of laches
because for many years she slept on her right over the
questioned property and failed to exhaust all means, legal or
administrative to retrieve what was rightfully hers at the
earliest possible time.
RTC further determined that the title was
transferred to Conrado’s name on June 1965 by virtue of a
document denominated as “Adjudication and Absolute Sale
of a Parcel of Registered Land” dated January 1949 and
signed by Aurora and her husband.
Aurora appealed to the Court of Appeals. Her
children substituted her after her death. The Court of Appeals
denied the appeal of the petitioners. It held that it took
Aurora more than 50 years to act on Conrado’s withholding
the title of the said property and petitioners were barred by
laches as Aurora should have been impervious in asserting
her ownership and made judicial demands to return the title
and the property.
The CA further explained that the prescriptive period
to recover property obtained through fraud or mistake giving
rise to an implied trust under Article 1456 of the Civil Code
was 10 years, pursuant to Article 1144. This 10-year
prescriptive period began from the time the land was
registered on June 17, 1965. Accordingly, Aurora had only
until June 17, 1975 within which to file her action. However,
Aurora commenced the suit only on May 12, 1996.
Petitioners moved for reconsideration, but their
motion was denied by the CA in the assailed Resolution,
dated February 3, 2012.
Hence, this petition.
Issue:
Whether or not petitioners are barred by laches
from revering the subject property.
Ruling:
The Supreme Court denied the petition and affirmed
in toto the assailed Decision and Resolution of the Court of
Appeals.
Petitioners assert that they are not guilty of laches
and that prescription is not a valid defense to defeat the title
of Aurora in relation to PD 1529 which states that no title to
registered land in derogation of the tile of the registered
owner shall be acquired by prescription or adverse
possession. The Court held that Section 47 of P.D. No. 1529
covers acquisitive prescription. A registered land therein can
never be acquired by adverse possession. In the case at
bench, however, it was extinctive prescription, and not
acquisitive prescription, which barred the action of
petitioners.
Moreover, the Court upheld the CA’s findings that all
elements for laches are present in this case. First, Aurora and
her family entrusted to Conrado the owner’s duplicate of the
certificate of title of the subject property in 1945. In their
complaint, petitioners even admitted that Conrado’s family
had been staying in the subject property since 1912. Second,
it took five decades, from 1945 to 1996, before Aurora and
petitioners decided to enforce their right thereon. Third,
respondents who lived all their lives in the disputed property
apparently were not aware that Aurora would one day come
out and claim ownership thereon. Fourth, there was no
question that respondents would be prejudiced in the event
that the suit would be allowed to prosper.
The four (4) elements of laches, as first prescribed by this
Court in Go Chi Gun v. Co Cho are as follows:
(1) conduct on the part of the defendant, or of one under
whom he claims, giving rise to the situation of which
complaint is made for which the complaint seeks a remedy;
(2) delay in asserting the complainant’s rights, the
complainant having had knowledge or notice, of the
defendant’s conduct and having been afforded an
opportunity to institute a suit;
(3) lack of knowledge or notice on the part of the defendant
that the complainant would assert the right on which he
bases his suit; and
(4) injury or prejudice to the defendant in the event relief is
accorded to the complainant, or the suit is not held to be
barred.
G.R. No. 147951 December 14, 2009
ARSENIO OLEGARIO and Heirs of ARISTOTELES F. OLEGARIO,
represented by CARMELITA GUZMAN-OLEGARIO,
Petitioners,
vs.
PEDRO C. MARI, represented by LILIA C. MARI-CAMBA,
Respondent.
Factual antecedents
As early as 1916, Juan Mari, the father of Pedro Mari,
declared his ownership over a parcel of land in Nancasalan,
Mangatarem for tax purposes. He took possession of the
same by delineating the limits with a bamboo fence, planting
various fruit bearing trees and bamboos and constructing a
house thereon. Tax Declaration No. 8048 for the year 1951
specified the subject realty as a residential land with an area
of 897 square meters and as having the following boundaries:
North - Magdalena Fernandez; South - Catalina Cacayorin;
East - Camino Vecinal; and West - Norberto Bugarin. In 1974,
the subject realty was transferred to respondent, Pedro Mari,
by virtue of a deed of sale.
In 1947, Wenceslao Olegario, the husband of Magdalena
Fernandez and father of petitioner Arsenio Olegario, filed a
new tax declaration9 for a certain 50-square meter parcel of
land, then on May 1961, he executed a "Deed of Quit-Claim
of Unregistered Property"10 in favor of Arsenio transferring
to the latter the aforementioned 50-square meter property.
The subject realty was identified as Lot Nos. 17526, 17553
and 14356.
In 1988, respondent filed with the DENR a protest against the
petitioners because of their encroachment into the disputed
realty. DENR decided in favor of the respondent and found
the latter to be the owner of Lot Nos. 17526, 17553 and
14356. Petitioners did not appeal and the said decision
became final and executory.
In 1989, Arsenio caused the amendment of his tax
declaration12 for the 50-square meter property to reflect an
increased area of 341 square meters. In 1990, after
discovering the amended entries in Arsenio’s Tax Declaration,
respondent filed a complaint14 with the RTC for Recovery of
Possession and Annulment of Tax Declaration. RTC rendered
judgment in favor of the petitioners. CA reversed the trial
court's findings.
Issues
1. Whether or not the Court of Appeals erred in its
decision in adjudicating ownership of the said lots in favor of
the respondent;
2. Whether or not the Court of Appeals erred in its
failure to declare the action as barred by laches;
Ruling
The petition has no merit.
1. Circumstances clearly show that Juan Mari was in
possession of subject realty in the concept of owner, publicly
and peacefully since 1916 or long before petitioners entered
the disputed realty sometime in 1965.Based on Article 538 of
the Civil Code,26 the respondent is the preferred possessor
because, benefiting from his father's tax declaration of the
subject realty since 1916, he has been in possession thereof
for a longer period. On the other hand, petitioners acquired
joint possession only sometime in 1965.
Petitioners' acts of a possessory character - acts that might
have been merely tolerated by the owner - did not constitute
possession. No matter how long tolerated possession is
continued, it does not start the running of the prescriptive
period.30 Mere material possession of land is not adverse
possession as against the owner and is insufficient to vest
title, unless such possession is accompanied by the intent to
possess as an owner. There should be a hostile use of such a
nature and exercised under such circumstance as to manifest
and give notice that the possession is under a claim of
right.31
Open, exclusive and undisputed possession of alienable
public land for the period prescribed by law creates the legal
fiction whereby the land, upon completion of the requisite
period - ipso jure and without the need of judicial or other
sanction, ceases to be public land and becomes private
property. Ownership of immovable property is acquired by
extraordinary prescription through possession for 30 years.35
For purposes of deciding the instant case, therefore, the
possession by respondent and his predecessor had already
ripened into ownership of the subject realty by virtue of
prescription as early as 1946.
2. Petitioners cannot find refuge in the principle of
laches. It is not just the lapse of time or delay that constitutes
laches. The essence of laches is the failure or neglect, for an
unreasonable and unexplained length of time, to do that
which, through due diligence, could or should have been
done earlier, thus giving rise to a presumption that the party
entitled to assert it had earlier abandoned or declined to
assert it.
The essential elements of laches are: (a) conduct on the part
of the defendant, or of one under whom he claims, giving rise
to the situation complained of; (b) delay in asserting
complainant's rights after he had knowledge of defendant's
acts and after he has had the opportunity to sue; (c) lack of
knowledge or notice by defendant that the complainant will
assert the right on which he bases his suit and (d) injury or
prejudice to the defendant in the event the relief is accorded
to the complainant.36
In the instant case, the second and third elements are
missing. Petitioners had notice and knew all along the
position of the respondent and his predecessor Juan Mari -
they were standing pat on his ownership over the subject
realty. On the other hand, it was petitioners who suddenly
changed their position in 1989 by changing the area of the
property declared in their name from 50 square meters to
341 square. Upon discovery of this clear and unequivocal
change in status of petitioners’ position over the disputed
land respondent immediately acted. He filed in 1990 the
complaint for recovery of possession and nullification of tax
declaration. Hence, we find no laches in the instant case.
Heirs of Crisologo v Rañon
G.R. No. 171068, September 5, 2007
Andamon, Honey Charish U.
FACTS:
The subject property in this case is a parcel of unregistered
land in Ilocos.
Ranon claims to be the owner of said lot by prescription. That
her family had been in continuous, adverse and
uninterrupted possession of such since 1962; that they paid
taxes thereto; and even built a house where she and her
family had resided. They however moved to Manila but
continued to visit the property from time to time. In 1986, a
fire incident occurred which destroyed the house. The same
year, they discovered that the property was already in the
name of Sps. Montemayor.
Sps. Montemayor alleged that they bought the parcel of land
from del Rosario and Arzadon (heirs in this case). The heirs
however were able to repurchase the property from the
spouses.
So between the heirs and Ranon, the heirs alleged that they
are the owners through succession. That Arzadon lived there
until the fire incident; and that they paid taxes. They alleged
that in 1977, Marcelina, their predecessor filed an adverse
claim against Ranon. The heirs argued that such filing
interrupted Ranon’s possession over the property.
ISSUES:
1. WON the Notice of Adverse Claim interrupted
Ranon’s possession. -NO.
2. WON Ranon’s possession is in the concept of an
owner. -YES.
3. WON Ranon acquired the property through
acquisitive prescription. -YES.
RULING:
1. NO.
For civil interruption to take place, the possessor must have
received judicial summons. The Notice of Adverse Claim
which was filed by Marcelina in 1977 is nothing more than a
notice of claim which did not effectively interrupt Ranon’s
possession.
2. YES. Ranon’s possession is in the concept of an
owner.
Court found the following as acts of dominion:
- Built a house on the property;
- Continued visiting and looking after the property even as
they already moved to Manila;
- Paid taxes;
- Ranon (husband) executed an affidavit declaring himself to
be the true and lawful owner, an express repudiation to the
claim of the heirs.
3. YES. Through Extraordinary Acquisitive Prescription.
There are two (2) kinds of Prescription:
a. Ordinary acquisitive prescription- possession in good faith
and with just title for 10 years.
b. Extraordinary acquisitive prescription- possession for 30
years without need of title or good faith.
Ranon traced their claim of ownership from 1962 until the
filing of their Complaint for Ownership on 1995, a total of 33
years. It was never interrupted by the Notice of the Adverse
Claim filed by Marcelina because it is judicial summons and
not mere notice that is required by law.
[ G.R. No. 194516, June 17, 2015 ]
BALDOMERA FOCULAN-FUDALAN, PETITIONER, VS.
SPOUSES DANILO OCIAL AND DAVIDICA BONGCARAS-OCIAL,
EVAGRIA F. BAGCAT, CRISTINA G. DOLLISEN, EULALIA F.
VILLACORA, TEOFREDO FUDERANAN, JAIME FUDERANAN,
MARIANO FUDERANAN, FILADELFO FUDERANAN,
MUSTIOLA F. MONTEJO, CORAZON LOGMAO, DIONESIO
FUDERANAN, EUTIQUIA FUDERANAN, ASTERIA
FUDERANAN, ANTONIO FUDERANAN, ROMEO FUDERANAN,
FLORENTINO FUDERANAN, DOMECIANO FUDERANAN,
ERLINDA SOMONTAN, FELICIANA FUDERANAN, BONIFACIO
FUDERANAN, QUIRINO FUDERANAN, MA. ASUNCION
FUDERANAN, MARCELINA ARBUTANTE, SALOME GUTUAL,
LEONARDO LUCILLA, IMELDA L. ESTOQUE, CIRILA OLANDRIA,
TITA G. BONGAY AND MUNICIPAL ASSESSOR OF PANGLAO,
BOHOL, RESPONDENTS.
FACTS: Spouses Danilo Ocial and Davidica Bongcaras-Ocial
(Spouses Ocial) , filed an action for the declaration of validity
of partition and sale, recovery of ownership and possession
and damages against Flavio Fudalan (Flavio) and Cristobal
Fudalan (Cristobal) before the Regional Trial Court, Branch 3,
Tagbilaran City. Later, Baldomera, the wife of Flavio and
mother of Cristobal, intervened as 3rd party plaintiff against
third-party defendants, Heirs of Pedro and Ulpiano
Fuderanan (the Fuderanans), the predecessors-in-interest of
Spouses Ocial.
The subject of the said action was a parcel of land designated
as Cad. Lot No. 56-A located at Tangnan, Panglao, Bohol,
which was a portion of Lot No. 56, Cad 705-D, Panglao
Cadastre, in the name of Juana Fuderanan (Juana).
Spouses Ocial alleged in their complaint that on March 13,
2001, the heirs of Juana executed the Extrajudicial Settlement
Among Heirs with Simultaneous Deed of Absolute Sale over
Lot 56-A; that in June 2001, the Fudalans, without any lawful
right or authorization, surreptitiously planted "ubi" on a
portion of Lot No. 56-A and they also claimed the
landowner's share of the mango produce from Maximo
Bolongaita who refused to give the same and instead
deposited the amount in a bank in Tagbilaran City; that in
November 2001, the Fudalans illegally placed two "no-
trespassing" signs inside the questioned property; that for
this reason, they complained to the barangay captain of
Tangnan, Panglao, Bohol, who conducted conciliation
proceedings on November 14 and 29, 2001; that no
settlement was reached between the parties; and that they
learned that on December 14 and 15, 2001, while the Lupong
Tagapamayapa had not yet issued the required Certification
to File Action, the Fudalans unjustifiably caused the
installation of a fence consisting of barbed wires with
cemented posts around Lot No. 56-A, without the necessary
permit from the barangay captain of Tangnan and the
municipal officials of Panglao, Bohol.
The Fudalans, on the other hand, claimed that they were the
rightful owners of the subject land having purchased the
same from the Fuderanans on November 4, 1983; that the
sale was evidenced by a private document printed in a blue
paper; that as owners, they planted "ubi," posted two "no-
trespassing" signs and installed a barb wire fence around the
land; that since their purchase, they had been in possession
of the land in the concept of owners and had been paying the
real property taxes religiously; and that it was for this reason
that they insisted that if there was any deed of extrajudicial
settlement of estate and simultaneous sale of the land by the
Fuderanans, the same was null and void for being without
legal basis.
In essence, Baldomera claims that because they have been in
adverse possession for the requisite period, their possession
has now ripened into ownership through acquisitive
prescription.
ISSUE: Has petitioner’s adverse possession ripened into
ownership through acquisitive prescription?
RULING: NO. In the present controversy, aside from
Baldomera's bare allegation that her family had been in
possession of the subject property since it was sold to her
parents, no other evidence, documentary or otherwise,
showing that the title to the subject property was indeed
transferred from Juana to her parents was presented. In fact,
she never denied that the tax declaration of the property was
still in the name of Juana Fuderanan. As such, for lack of "just
title," she could not have acquired the disputed property by
ordinary prescription through possession often (10) years.
Occupation or use alone, no matter how long, cannot confer
title by prescription or adverse possession unless coupled
with the element of hostility towards the true owner, that is,
possession under the claim of title.[31]
Even the allegation that sometime on November 4, 1983, a
blue paper was executed wherein Teofredo and Eutiquia,
allegedly the duly authorized representatives of the heirs of
Juana to settle their claims over the land, acknowledged to
have received the sum of P1,000.00,[32] cannot be
considered a valid basis for a possession in good faith and just
title. The alleged agreement which is, at best, a compromise
agreement cannot be made as the foundation of a conclusion
that Baldomera is a possessor in good faith and with just title
who acquired the property through ordinary acquisitive
prescription. By the nature of a compromise agreement,
which brings the parties to agree to something that neither of
them may actually want, but for the peace it will bring them
without a protracted litigation, no right can arise therefrom
because the parties executed the same only to buy peace and
to write finis to the controversy. It did not create or transmit
ownership rights over the subject property.[33]
That being settled, the next question now is: Can Baldomera
acquire the property through extraordinary acquisitive
prescription?
The Court is still constrained to rule in the negative. In
extraordinary prescription, ownership and other real rights
over immovable property are acquired through uninterrupted
adverse possession for 30 years even without need of title or
of good faith. There was no mention of the predecessor
parents of Baldomera as one of the administrators which
would only fairly suggest that they were never in possession
of the land. Taking cue from the foregoing, Baldomera's
alleged possession could not have amounted to an ownership
by way of extraordinary acquisitive prescription. According to
the factual findings of the trial court, it was only in 1994 that
her husband, Flavio was named administrator; that it was
also then that they started paying taxes; and that it was also
then that they started occupying the subject property. This
observation of the trial court was contrary to her assertion
that they had been paying taxes and had been in possession
of the land even before the said period. On this note, the
thirty-year period would only be completed in the year 2024.
Also, the records would reveal that as early as November
2001, her possession was effectively interrupted when
Spouses Ocial filed a complaint before the barangay captain
of Tangnan, Panglao, Bohol, where conciliation proceedings
were held although no settlement was reached.
. Octavio Kalalo vs Alfredo Luz
34 SCRA 337 – Mercantile Law – Negotiable Instruments Law
– Negotiable Instruments in General – Sum Certain in Money
– Currency To Be Used
Octavio Kalalo is an engineer whose services were contracted
by Alfredo Luz, an architect in 1961. Luz contracted Kalalo to
work on ten projects across the country, one of which was an
in the International Rice Research Institute (IRRI) Research
Center in Los Baños, Laguna. Luz was to be paid $140,000.00
for the entire project. For Kalalo’s work, Luz agreed to pay
him 20% of what IRRI is going to pay or equivalent to
$28,000.00.
ISSUE: Whether or not Kalalo should be paid in US currency.
HELD: No. The agreement was forged in 1961, years before
the passage of Republic Act 529 in 1950. The said law
requires that payment in a particular kind of coin or currency
other than the Philippine currency shall be discharged in
Philippine currency measured at the prevailing rate of
exchange at the time the obligation was incurred. Nothing in
the law however provides which rate of exchange shall be
used hence it is but logical to use the rate of exchange at the
time of payment.
FIRST DIVISION
[G.R. No. 140528 : December 07, 2011]
MARIA TORBELA, REPRESENTED BY HER HEIRS, NAMELY:
EULOGIO TOSINO, HUSBAND AND CHILDREN: CLARO,
MAXIMINO, CORNELIO, OLIVIA AND CALIXTA, ALL SURNAMED
TOSINO, APOLONIA TOSINO VDA. DE RAMIREZ AND JULITA
TOSINO DEAN; PEDRO TORBELA, REPRESENTED BY HIS HEIRS,
NAMELY: JOSE AND DIONISIO, BOTH SURNAMED TORBELA;
EUFROSINA TORBELA ROSARIO, REPRESENTED BY HER HEIRS,
NAMELY: ESTEBAN T. ROSARIO, MANUEL T. ROSARIO,
ROMULO T. ROSARIO AND ANDREA ROSARIO-HADUCA;
LEONILA TORBELA TAMIN; FERNANDO TORBELA,
REPRESENTED BY HIS HEIRS, NAMELY: SERGIO T. TORBELA,
EUTROPIA T. VELASCO, PILAR T. ZULUETA, CANDIDO T.
TORBELA, FLORENTINA T. TORBELA AND PANTALEON T.
TORBELA; DOLORES TORBELA TABLADA; LEONORA TORBELA
AGUSTIN, REPRESENTED BY HER HEIRS, NAMELY: PATRICIO,
SEGUNDO, CONSUELO AND FELIX, ALL SURNAMED AGUSTIN;
AND SEVERINA TORBELA ILDEFONSO, PETITIONERS, VS.
SPOUSES ANDRES T. ROSARIO AND LENA DUQUE-ROSARIO
AND BANCO FILIPINO SAVINGS AND MORTGAGE BANK,
RESPONDENTS.
G.R. NO. 140553
LENA DUQUE-ROSARIO, PETITIONER, VS. BANCO FILIPINO
SAVINGS AND MORTGAGE BANK, RESPONDENT.
DECISION
LEONARDO-DE CASTRO, J.:
Presently before the Court are two consolidated Petitions for
Review on Certiorari under Rule 45 of the Rules of Court,
both assailing the Decision 1 dated June 29, 1999 and
Resolution 2 dated October 22, 1999 of the Court of Appeals
in CA-G.R. CV No. 39770.cralaw
The petitioners in G.R. No. 140528 are siblings Maria Torbela,
3 Pedro Torbela, 4 Eufrosina Torbela Rosario, 5 Leonila
Torbela Tamin, Fernando Torbela, 6 Dolores Torbela Tablada,
Leonora Torbela Agustin, 7 and Severina Torbela Ildefonso
(Torbela siblings).
The petitioner in G.R. No. 140553 is Lena Duque-Rosario
(Duque-Rosario), who was married to, but now legally
separated from, Dr. Andres T. Rosario (Dr. Rosario). Dr.
Rosario is the son of Eufrosina Torbela Rosario and the
nephew of the other Torbela siblings.
The controversy began with a parcel of land, with an area of
374 square meters, located in Urdaneta City, Pangasinan (Lot
No. 356-A). It was originally part of a larger parcel of land,
known as Lot No. 356 of the Cadastral Survey of Urdaneta,
measuring 749 square meters, and covered by Original
Certificate of Title (OCT) No. 16676, 8 in the name of
Valeriano Semilla (Valeriano), married to Potenciana Acosta.
Under unexplained circumstances, Valeriano gave Lot No.
356-A to his sister Marta Semilla, married to Eugenio Torbela
(spouses Torbela). Upon the deaths of the spouses Torbela,
Lot No. 356-A was adjudicated in equal shares among their
children, the Torbela siblings, by virtue of a Deed of
Extrajudicial Partition 9 dated December 3, 1962.
On December 12, 1964, the Torbela siblings executed a Deed
of Absolute Quitclaim 10 over Lot No. 356-A in favor of Dr.
Rosario. According to the said Deed, the Torbela siblings "for
and in consideration of the sum of NINE PESOS (P9.00) x x x
transfer[red] and convey[ed] x x x unto the said Andres T.
Rosario, that undivided portion of THREE HUNDRED SEVENTY-
FOUR square meters of that parcel of land embraced in
Original Certificate of Title No. 16676 of the land records of
Pangasinan x x x." 11 Four days later, on December 16, 1964,
OCT No. 16676 in Valeriano"'s name was partially cancelled
as to Lot No. 356-A and TCT No. 52751 12 was issued in Dr.
Rosario's name covering the said property.
Another Deed of Absolute Quitclaim 13 was subsequently
executed on December 28, 1964, this time by Dr. Rosario,
acknowledging that he only borrowed Lot No. 356-A from the
Torbela siblings and was already returning the same to the
latter for P1.00. The Deed stated:
That for and in consideration of the sum of one peso (P1.00),
Philippine Currency and the fact that I only borrowed the
above described parcel of land from MARIA TORBELA,
married to Eulogio Tosino, EUFROSINA TORBELA, married to
Pedro Rosario, PEDRO TORBELA, married to Petra Pagador,
LEONILA TORBELA, married to Fortunato Tamen, FERNANDO
TORBELA, married to Victoriana Tablada, DOLORES TORBELA,
widow, LEONORA TORBELA, married to Matias Agustin and
SEVERINA TORBELA, married to Jorge Ildefonso, x x x by these
presents do hereby cede, transfer and convey by way of this
ABSOLUTE QUITCLAIM unto the said Maria, Eufrosina, Pedro,
Leonila, Fernando, Dolores, Leonora and Severina, all
surnamed Torbela the parcel of land described above. 14
(Emphasis ours.)
The aforequoted Deed was notarized, but was not
immediately annotated on TCT No. 52751.
Following the issuance of TCT No. 52751, Dr. Rosario
obtained a loan from the Development Bank of the
Philippines (DBP) on February 21, 1965 in the sum of
P70,200.00, secured by a mortgage constituted on Lot No.
356-A. The mortgage was annotated on TCT No. 52751 on
September 21, 1965 as Entry No. 243537. 15 Dr. Rosario
used the proceeds of the loan for the construction of
improvements on Lot No. 356-A.
On May 16, 1967, Cornelio T. Tosino (Cornelio) executed an
Affidavit of Adverse Claim, 16 on behalf of the Torbela
siblings. Cornelio deposed in said Affidavit:
3. That ANDRES T. ROSARIO later quitclaimed his rights in
favor of the former owners by virtue of a Deed of Absolute
Quitclaim which he executed before Notary Public Banaga,
and entered in his Notarial Registry as Dec. No. 43; Page No.
9; Book No. I; Series of 1964;
4. That it is the desire of the parties, my aforestated kins, to
register ownership over the above-described property or to
perfect their title over the same but their Deed could not be
registered because the registered owner now, ANDRES T.
ROSARIO mortgaged the property with the DEVELOPMENT
BANK OF THE PHILIPPINES, on September 21, 1965, and for
which reason, the Title is still impounded and held by the said
bank;
5. That pending payment of the obligation with the
DEVELOPMENT BANK OF THE PHILIPPINES or redemption of
the Title from said bank, I, CORNELIO T. TOSINO, in behalf of
my mother MARIA TORBELA-TOSINO, and my Aunts
EUFROSINA TORBELA, LEONILA TORBELA-TAMEN, DOLORES
TORBELA, LEONORA TORBELA-AGUSTIN, SEVERINA TORBELA-
ILDEFONSO, and my Uncles PEDRO TORBELA and FERNANDO,
also surnamed TORBELA, I request the Register of Deeds of
Pangasinan to annotate their adverse claim at the back of
Transfer Certificate of Title No. 52751, based on the annexed
document, Deed of Absolute Quitclaim by ANDRES T.
ROSARIO, dated December 28, 1964, marked as Annex "A"
G.R. No. 193453 June 5, 2013
SPOUSES RUBIN AND PORTIA HOJAS, Petitioners,
vs.
PHILIPPINE AMANAH BANK AND RAMON KUE, Respondents.
DECISION
MENDOZA, J.:
This is a petition for review on certiorari assailing the July 28,
2010 Decision1 of the Court of Appeals (CA), in CA-G.R. CV
No. 55722, which affirmed the May 27, 1996 Decision of the
Regional Trial Court, Branch 13, Zamboanga City (RTC),
dismissing Civil Case No. 1028 (3952), an action for
"Determination of True Balance of Mortgage, Debt,
Annulment/Setting
Aside of Extrajudicial Foreclosure of Mortgage and Damages,
with Prayer for Preliminary Injunction."
The petitioners, Spouses Rubin and Portia Hojas (petitioners),
alleged that on April 11, 1980, they secured a loan from
respondent Philippine Amanah Bank (PAB) in the amount of
₱450,000.00; that this loan was secured by a mortgage,
covering both personal and real properties; that from May
14, 1981 to June 27, 1986, they made various payments
amounting to ₱486,162.13; that PAB, however, did not
properly credit their payments; that based on the summary of
payments furnished by PAB to them on February 24, 1989,
only 13 payments were credited, erroneously amounting to
₱317,048.83; that PAB did not credit the payment they made
totaling ₱165,623.24; and that, in the statement of their
account as of October 17, 1984, PAB listed their total
payment as ₱412,211.54 on the principal, and ₱138,472.09 as
30% interest, all amounting to ₱550,683.63, despite the fact
that at that time, petitioners had already paid the total sum
of ₱486,162.13.2
Petitioners further averred that for failure to pay the loan,
PAB applied for the extrajudicial foreclosure of the
mortgaged real properties of petitioners with the Ex-Officio
Sheriff; that consequently, a Notice of Extrajudicial
Foreclosure was issued on January 12, 1987 setting the
foreclosure sale on April 21, 1987 and, stating therein the
mortgage debt in the sum of ₱450,000.00; and that, in the
public auction conducted, PAB acquired said real property.3
It was further alleged that on March 9, 1988, through the
intervention of then Senator Aquilino Pimentel, Farouk A.
Carpizo (Carpizo), the OICPresident of PAB, wrote Roberto
Hojas (Roberto), petitioners’ son, informing him that although
the one-year redemption period would expire on April 21,
1988, by virtue of the bank’s incentive scheme, the
redemption period was extended until December 31, 1988;
that despite said letter from the OIC-President, the OIC of the
Project Development Department of PAB wrote Rubin Hojas
that the real properties acquired by PAB would be sold in a
public bidding before the end of August, 1988; that on
November 4, 1988, a public bidding was conducted; that in
the said bidding, the mortgaged properties were awarded to
respondent Ramon Kue (Kue); that subsequently, they
received a letter from the OIC of the Project Development
Department, dated January 3, 1989, informing them that they
had fifteen (15) days from receipt within which to vacate the
premises; that Kue then sent another letter, dated January
31, 1989, informing them that he had already acquired the
said property and that they were requested to vacate the
premises within fifteen (15) days from receipt thereof;4 and
that because of this development, on May 7, 1991,
petitioners filed an action for "Determination of True Balance
of Mortgage Debt, Annulment/Setting Aside of Extrajudicial
Foreclosure of Mortgage and Damages, with Prayer for
Preliminary Injunction" against PAB.5
On May 27, 1996, the RTC dismissed petitioners’ complaint. It
ruled, among others, that: 1) PAB was not guilty of bad faith
in conducting the extrajudicial foreclosure as it, at one time,
even suspended the conduct of the foreclosure upon the
request of petitioners, who, nevertheless, failed to exert
effort to settle their accounts; 2) because petitioners failed to
redeem their properties within the period allowed, PAB
became its absolute owner and, as such, it had the right to
sell the same to Kue, who acquired the property for value and
in good faith; and 3) the subsequent foreclosure and auction
sale having been conducted above board and in accordance
with the requisite legal procedure, collusion between PAB
and Kue was certainly alien to the issue.6
Aggrieved, petitioners filed an appeal assailing the May 27,
1996 RTC Decision. They asserted that the March 9, 1988
Letter of Carpizo to Roberto Hojas extended the redemption
period from April 21 to December 31, 1988. Considering that
they had relied on Carpizo’s representation, PAB violated the
principle of estoppel when it conducted the public sale on
November 4, 1988.7 Their basis was the portion of said letter
which stated:
xxxx
As the Bank has adopted an incentive scheme whereby
payments are liberalized to give chances to former owners to
repossess their properties, we suggest that you advise your
parents to drop by at our Zamboanga Office so they can avail
of this rare privilege which shall be good only up to December
31, 1988. (Emphasis supplied)8
The CA was not sympathetic with petitioners’ position. It held
that the period of redemption was never extended. The date
"December 31, 1988" was not an extension of the
redemption period. It was merely the last day for the
availment of the liberalized payment for the repossession of
foreclosed assets under PAB’s incentive scheme. PAB,
through said letter, did not make an unqualified
representation to petitioners that it had extended the
redemption period. As such, PAB could not be said to have
violated the principle of estoppel when it conducted a public
sale on November 4, 1988.9 Thus, the dispositive portion of
the CA decision reads:
ACCORDINGLY, the instant appeal is DENIED. The Decision
dated May 27, 1996, of the Regional Trial Court, 9th Judicial
Region, Branch No. 13 of Zamboanga City, in Civil Case No.
1028 (3952), is AFFIRMED.
SO ORDERED.10
Undaunted, petitioners filed the present petition for review.
It postulated the sole issue:
WHETHER OR NOT THE CA ERRED IN NOT HOLDING PAB TO
HAVE VIOLATED THE PRINCIPLE OF ESTOPPEL WHEN THE
LATTER CONDUCTED THE NOVEMBER 4, 1988 PUBLIC SALE.
Petitioners reiterated their argument that the November 4,
1988 public sale by PAB was violative of the principle of
estoppel because said bank made it appear that the one-year
redemption period was extended. As such, when PAB sold the
property before said date, they suffered damages and were
greatly prejudiced.11 They also argued that since they
manifested their interest in availing of the said "incentive
scheme," PAB should have, at the very least, waited until
December 31, 1988, before it sold the subject foreclosed
property in a public auction.12
On the other hand, PAB explains that the purpose of the
"incentive scheme" was to give previous owners the chance
to redeem their properties on easy payment term basis,
through condonation of some charges and penalties and
allowing payment by installment based on their proposals
which may be acceptable to PAB. Therefore, the March 9,
1988 Letter of Carpizo was an invitation for petitioners to
submit a proposal to PAB.13 It was not meant to extend the
one-year redemption period.
As early as August 11, 1988, PAB wrote petitioners informing
them of the scheduled public bidding. After receipt of the
letter, petitioners went to PAB to signify their willingness to
avail of the said incentive scheme. They, however, failed to
submit a proposal. In fact, PAB did not hear from petitioners
again. As such, the respondent sold the subject property in a
public sale on November 4, 198814 PAB cited the RTC’s
finding that although the petitioners manifested their
intention to avail of the incentive scheme desire alone was
not sufficient. Redemption is not a matter of intent but
involved making the proper payment or tender of the price of
the land within the specified period.15
The petition is bereft of merit.
Through estoppel, an admission or representation is rendered
conclusive upon the person making it, and cannot be denied
or disproved as against the person relying on it.16 This
doctrine is based on the grounds of public policy, fair dealing,
good faith, and justice and its purpose is to forbid one to
speak against his own act, representations or commitments
to the injury of one to whom they were directed and who
reasonably relied on it.17 Thus, in order for this doctrine to
operate, a representation must have been made to the
detriment of another who relied on it. In other words,
estoppel would not lie against one who, in the first place, did
not make any representation.
In this case, a perusal of the letter, on which petitioners
based their position that the redemption period had been
extended, shows otherwise. Pertinent portions of the said
letter read:
xxxx
Our records show that the above account has already been
foreclosed by the bank. However, the borrowers concerned
can still exercise the one (1) year right of redemption over the
foreclosed properties until April 21, 1988.
As the Bank has adopted an incentive scheme whereby
payments are liberalized to give chances to former owners to
repossess their properties, we suggest that you advise your
parents to drop by at our Zamboanga Office so they can avail
of this rare privilege which shall be good only up to December
31, 1988. [Emphases and Underscoring Supplied]18
As correctly held by the RTC and upheld by the CA, the date
"December 31, 1988" refers to the last day when owners of
foreclosed properties, like petitioners, could submit their
payment proposals to the bank. The letter was very clear. It
was about the availment of the liberalized payment scheme
of the bank. On the last day for redemption, the letter was
also clear. It was April 21, 1988. It was never extended.
The opportunity given to the petitioners was to avail of the
liberalized payment scheme which program would expire on
December 31, 1988. As explained by Abraham Iribani
(Iribani), the OIC of the Project Development Department of
PAB, it was to give a chance to previous owners to repossess
their properties on easy term basis, possibly by condonation
of charges and penalties and payment on instalment. The
letter of Carpizo was an invitation to the petitioners to come
to the bank with their proposal. It appears that the
petitioners could not come up with a proposal acceptable to
the bank.
For said reason, the mortgaged property was included in the
list of mortgaged properties that would be sold through a
scheduled public bidding. Thus, on August 11, 1988, Iribani
wrote the petitioners about the scheduled bidding. In
response, the petitioners told Iribani that they would go
Manila to explain their case. They did not, however, return
even after the public bidding. In this regard, the CA was
correct when it wrote:
Here, there is no estoppel to speak of. The letter does not
show that the Bank had unqualifiedly represented to the
Hojases that it had extended the redemption period to
December 31, 1988. Thus, the Hojases have no basis in
positing that the public sale conducted on November 4, 1988
was null and void for having been prematurely conducted.19
Moreover, petitioners’ allegation that they had signified their
intention to avail of the incentive scheme (which they have
equated to their intention to redeem the property), did not
amount to an exercise of redemption precluding the bank
from making the public sale.20 In the case of China Banking
Corporation v. Martir,21 this Court expounded on what
constitutes a proper exercise of the right of redemption, to
wit:
The general rule in redemption is that it is not sufficient that
a person offering to redeem manifests his desire to do so.
The statement of intention must be accompanied by an
actual and simultaneous tender of payment. This constitutes
the exercise of the right to repurchase.
In several cases decided by the Court where the right to
repurchase was held to have been properly exercised, there
was an unequivocal tender of payment for the full amount of
the repurchase price. Otherwise, the offer to redeem is
ineffectual. Bona fide redemption necessarily implies a
reasonable and valid tender of the entire repurchase price,
otherwise the rule on the redemption period fixed by law can
easily be circumvented.
Moreover, jurisprudence also characterizes a valid tender of
payment as one where the full redemption price is tendered.
Consequently, in this case, the offer by respondents on July
24, 1986 to redeem the foreclosed properties for ₱1,872,935
and the subsequent consignation in court of ₱1,500,000 on
August 27, 1986, while made within the period of
redemption, was ineffective since the amount offered and
actually consigned not only did not include the interest but
was in fact also way below the ₱2,782,554.66 paid by the
highest bidder/purchaser of the properties during the auction
sale.
In the case at bench, the record is bereft of concrete evidence
that would show that, aside from the fact that petitioners
manifested their intention to avail of the scheme, they were
also ready to pay the redemption price. Hence, as they failed
to exercise their right of redemption and failed to take
advantage of the liberalized incentive scheme, PAB was well
within its right to sell its property in a public sale.

In Bodiongan vs. Court of Appeals, we held:

WHEREFORE, the petition is DENIED.

In order to effect a redemption, the judgment debtor must
pay the purchaser the redemption price composed of the
following: (1) the price which the purchaser paid for the SO ORDERED.
property; (2) interest of 1% per month on the purchase price;
(3) the amount of any assessments or taxes which the
purchaser may have paid on the property after the purchase;
JOSE CATRAL MENDOZA
and (4) interest of 1% per month on such assessments and
taxes x x x. Associate Justice

Furthermore, Article 1616 of the Civil Code of the Philippines

provides:
FIRST DIVISION

The vendor cannot avail himself of the right to repurchase

without returning to the vendee the price of the sale x x x. [G.R. No. L-41001. September 30, 1976.]

It is not difficult to understand why the redemption price
should either be fully offered in legal tender or else validly
consigned in court. Only by such means can the auction
winner be assured that the offer to redeem is being made in
good faith.1âwphi1
MANILA LODGE NO. 761, BENEVOLENT AND PROTECTIVE
ORDER OF THE ELKS, INC., Petitioner, v. THE HONORABLE
COURT OF APPEALS, CITY OF MANILA, and TARLAC
DEVELOPMENT CORPORATION, Respondents.

[G.R. No. L-41012. September 30, 1976.]

Respondents' repeated requests for information as regards
the amount of loan availed from the credit line and the
amount of redemption, and petitioner's failure to accede to TARLAC DEVELOPMENT CORPORATION, Petitioner, v.
said requests do not invalidate the foreclosure. Respondents HONORABLE COURT OF APPEALS, CITY OF MANILA, LODGE
can find other ways to know the redemption price. For one, NO. 761, BENEVOLENT AND PROTECTIVE ORDER OF ELKS,
they can examine the Certificate of Sale registered with the INC., Respondents.
Register of Deeds to verify the purchase price, or upon the
filing of their complaint, they could have moved for a
computation of the redemption price and consigned the
same to the court. At any rate, whether or not respondents Quasha, Asperilla, Zafra, Tayag & Ancheta, for Manila Lodge
'"were diligent in asserting their willingness to pay is No. 761, Benevolent and Protective Order of the ELKS, Inc.
irrelevant. Redemption within the period allowed by law is
not a matter of intent but a question of payment or valid
tender of the full redemption price within said period. Jose P. Bengzon, Villegas, Zarraga, Narciso & Cudala and
Emmanuel G. Cochico, for Tarlac Development Corporation.

Even the complaint instituted by respondents cannot aid their

plight because the institution of an action to annul a S.M. Artiaga Jr. and Restituto R. Villanueva, Office of the City
foreclosure sale does not suspend the running of the Legal Officer for City of Manila.
redemption period. (Underscoring supplied)22
DECISION
CASTRO, J.:
STATEMENT OF THE CASE AND STATEMENT
OF THE FACTS
These two cases are petitions on certiorari to review the
decision dated June 30, 1975 of the Court of Appeals in CA-
G.R. No. 51590-R entitled "Tarlac Development Corporation
v. City of Manila, and Manila Lodge No. 761, Benevolent and
Protective Order of Elks, Inc.," affirming the trial court’s
finding in Civil Case No. 83009 that the property subject of
the decision a quo is a "public park or plaza."
chanrobles.com:cralaw:red
On June 26, 1905 the Philippine Commission enacted Act No.
1.360 which authorized the City of Manila to reclaim a
portion of Manila Bay. The reclaimed area was to form part of
the Luneta extension. The Act provided that the reclaimed
area "shall be the property of the City of Manila" and that
"the City of Manila is hereby authorized to set aside a tract of
the reclaimed land formed by the Luneta extension . . . at the
north end not to exceed five hundred feet by six hundred feet
in size, for a hotel site, and to lease the same, with the
approval of the Governor General, to a responsible person or
corporation for a term not to exceed ninety-ninety
years."cralaw virtua1aw library
Subsequently, the Philippine Commission passed on May 18,
1907 Act No. 1657, amending Act No. 1360, so as to authorize
the City of Manila either to lease or to sell the portion set
aside as a hotel site.
The total area reclaimed was a little over 25 hectares. The
City of Manila applied for the registration of the reclaimed
area, and on January 20, 1911, O.C.T. No. 1909 was issued in
the name of the City of Manila. The title described the
registered land as "un terreno conocido con el nombre de
Luneta Extension, situado en el distrito de la Ermita . . .." The
registration was "subject, however, to such of the
incumbrances mentioned in Article 39 or said law (Land
Registration Act) as may be subsisting" and "sujeto a las
disposiciones y condiciones impuestas en la Ley No. 1360; y
sujeto tambien a los contratos de venta. celebrados y
otorgados por la Ciudad de Manila a favor del Army and Navy
Club y la Manila Lodge No. 761, Benevolent and Protective
Order of Elks, fechados respectivamente, en 29 de Diciembre
de 1908 y 16 de Enero de 1909." 1
On July 13, 1911 the City of Manila, affirming a prior sale
dated January 16, 1909, conveyed 5,543.07 square meters of
the reclaimed area to the Manila Lodge No. 761, Benevolent
and Protective Order of Elks of the U.S.A. (BPOE, for short) on
the basis of which TCT No. 2195 2 was issued to the latter
over the "parcela de terreno que es parte de la Luneta
Extension, Situada en el Distrito de la Ermita . . .." At the back
of this title was annotated document 4608/T-1635, which in
part reads as follows: "que la citada Ciudad de Manila tendra
derecho a su opcion, de recomprar la expresada propiedad
para fines publicos solamente, en cualquier tiempo despues
de cincuenta anos desde el 13 de Julio de 1911, previo pago a
la entidad compradora, o a sus sucesores del precio de la
venta de la misma propiedad, mas el valor que entonces
tengan las mejoras."cralaw virtua1aw library
For the remainder of the Luneta Extension, that is, after
segregating therefrom the portion sold to the Manila Lodge
No. 761, BPOE, a new Certificate of Title No. 2196 3 was
issued on July 17, 1911 to the City of Manila.
Manila Lodge No. 761, BPOE, subsequently sold the said
5,543.07 square meters to the Elks Club, Inc., to which was
issued TCT No. 67488. 4 The registered owner, "The Elks Club,
Inc.," was later changed by court order to "Manila Lodge No.
761, Benevolent and Protective Order of Elks, Inc."cralaw
virtua1aw library
In January 1963 the BPOE petitioned the Court of First
Instance of Manila, Branch IV, for the cancellation of the right
of the City of Manila to repurchase the property. This petition
was granted on February 15, 1963.
On November 19, 1963 the BPOE sold for the sum of
P4,700,000 the land together with all the improvements
thereon to the Tarlac Development Corporation (TDC, for
short) which paid P1,700,000 as down payment and
mortgaged to the vendor the same realty to secure the
payment of the balance to be paid in quarterly installments. 5
At the time of the sale, there was no annotation of any
subsisting lien on the title to the property. On December 12,
1963 TCT No. 73444 as issued to TDC over the subject land
still described as "UNA PARCELA DE TERRENO, que es parte
de la Luneta Extension, situada en el Distrito de Ermita . .
.."cralaw virtua1aw library
In June 1964 the City of Manila filed with the Court of First
Instance of Manila a petition for the reannotation of its right
to repurchase; the court, after hearing, issued an order,
dated November 19, 1964, directing the Register of Deeds of
the City of Manila to reannotate in toto the entry regarding
the right of the City of Manila to repurchase the property
after fifty years. From this order TDC and BPOE appealed to
this Court which on July 31, 1968 affirmed in G.R. Nos. L-
24557 and L-24469 the trial court’s order of reannotation, but
reserved to TDC the right to bring another action for the
clarification of its rights.chanrobles law library
As a consequence of such reservation, TDC filed on April 28,
1971 against the City of Manila and the Manila Lodge No.
761, BPOE, a complaint, docketed as Civil Case No. 83009 of
the Court of First Instance of Manila, containing three causes
of action and praying —
"a) On the first cause of action, that the plaintiff TDC be
declared to have purchased the parcel of land now in
question with the buildings and improvements thereon from
the defendant BPOE for value and in good faith, and
accordingly ordering the cancellation of Entry No. 4608/T-
1635 on Transfer Certificate of Title No. 73444 in the name of
the Plaintiff.
"b) On the second cause of action, ordering the defendant of
Manila to pay the plaintiff TDC damages in the sum of not less
than one hundred thousand pesos (P100,000.00);
"c) on the third cause of action, reserving to the plaintiff TDC
the right to recover from the defendant BPOE the amounts
mentioned in par. XVI of the complaint in accordance with
Art. 1555 of the Civil Code, in the remote event that the final
judgment in this case should be that the parcel of land now in
question is a public park; and
"d) For costs, and for such other and further relief as the
Court may deem just and equitable." 6
Therein defendant City of Manila, in its answer dated May 19,
1971, admitted all the facts alleged in the first cause of action
except the allegation that TDC purchased said property "for
value and in good faith," but denied for lack of knowledge or
information the allegations in the second and third causes of
action. As special and affirmative defense, the City of Manila
claimed that TDC was not a purchaser in good faith for it had
actual notice of the City’s right to repurchase which was
annotated at the back of the title prior to its cancellation, and
that, assuming arguendo that TDC had no notice of the right
to repurchase, it was, nevertheless, under obligation to
investigate inasmuch as its title recites that the property is a
part of the Luneta extension. 7
The Manila Lodge No. 761, BPOE, in its answer dated June 7,
1971, admitted having sold the land together with the
improvements thereon for value to therein plaintiff which
was in good faith, but denied for lack of knowledge as to their
veracity the allegations under the second cause of action. It
furthermore admitted that TDC had paid the quarterly
installments until October 15, 1964 but claimed that the
latter failed without justifiable cause to pay the subsequent
installments. It also asserted that it was a seller for value in
good faith without having misrepresented or concealed facts
relative to the title on the property. As counterclaim, Manila
Lodge No. 761 (BPOE) sought to recover the balance of the
purchase price plus interest and costs. 8
On June 15, 1971 TDC answered the aforesaid counterclaim,
alleging that its refusal to make further payments was fully
justified. 9
After due trial the court a quo rendered on July 14, 1972 its
decision finding the subject land to be part of the "public park
or plaza" and, therefore, part of the public domain. The court
consequently declared that the sale of the subject land by the
City of Manila to Manila Lodge No. 761, BPOE, was null and
void; that plaintiff TDC was a purchaser thereof in good faith
and for value from BPOE and can enforce its rights against the
latter; and that BPOE is entitled to recover from the City of
Manila whatever consideration it had paid the latter. The
dispositive part of the decision reads:jgc:chanrobles.com.ph
"WHEREFORE, the Court hereby declares that the parcel of
land formerly covered by Transfer Certificate of Title Nos.
2195 and 67488 in the name of BPOE and now by Transfer
Certificate of Title No. 73444 in the name of Tarlac
Development Corporation is a public park or plaza, and,
consequently, instant complaint is dismissed, without
pronouncement as to costs.
"In view of the reservation made by plaintiff Tarlac
Development Corporation to recover from defendant BPOE
the amounts mentioned in paragraph XVI of the complaint in
accordance with Article 1555 of the Civil Code, the Court
makes no pronouncement on this point." 10
From said decision the therein plaintiff TDC as well as the
defendant Manila Lodge No. 761, BPOE, appealed to the
Court of Appeals.
In its appeal docketed as CA-G.R. No. 51590-R, the Manila
Lodge No. 761, BPOE, avers that the trial court committed the
following errors, namely:chanrob1es virtual 1aw library
1. In holding that the property subject of the action is not
patrimonial property of the City of Manila; and
2. In holding that the Tarlac Development Corporation may
recover and enforce its right against the defendant BPOE. 11
The Tarlac Development Corporation, on the other hand,
asserts that the trial court erred:chanrob1es virtual 1aw
library
(1) In finding that the property in question is or was a public
park and in consequently nullifying the sale thereof by the
City of Manila to BPOE;
(2) In applying the cases of Municipality of Cavite v. Rojas, 30
Phil. 602, and Government v. Cabangis, 53 Phil. 112, to the
case at bar; and
(3) In not holding that the plaintiff-appellant is entitled to
recover damages from the defendant City of Manila. 12
Furthermore, TDC, as appellee regarding the second
assignment of error raised by BPOE, maintained that it can
recover and enforce its right against BPOE in the event that
the land in question is declared a public park or part thereof.
13
In its decision promulgated on June 30, 1975, the Court of
Appeals concurred in the findings and conclusions of the
lower court upon the ground that they are supported by the
evidence and are in accordance with law, and accordingly
affirmed the lower court’s judgment.
Hence, the present petitions for review on certiorari.
G.R. No. L-41001
The Manila Lodge No. 761, BPOE, contends, in its petition for
review on certiorari docketed as G.R. No. L-41001, that the
Court of Appeals erred in (1) disregarding the very enabling
acts and/or statutes according to which the subject property
was, and still is, patrimonial property of the City of Manila
and could therefore be sold and/or disposed of like any other
private property; and (2) in departing from the accepted and
usual course of judicial proceedings when it simply made a
general affirmance of the court a quo’s findings and
conclusions without bothering to discuss or resolve several
vital points stressed by the BPOE in its assigned errors. 14
G.R. No. L-41012
The Tarlac Development Corporation, in its petition for
review on certiorari docketed as G.R. No. L-41012, relies on
the following grounds for the allowance of its
petition:chanrob1es virtual 1aw library
1. that the Court of Appeals did not correctly interpret Act
No. 1360, as amended by Act No. 1657, of the Philippine
Commission; and
2. that the Court of Appeals has departed from the accepted
and usual course of judicial proceedings in that it did not
make its own findings but simply recited those of the lower
court. 15
ISSUES AND ARGUMENTS
FIRST ISSUE
Upon the first issue, both petitioners claim that the property
subject of the action, pursuant to the provisions of Act No.
1360, as amended by Act No. 1657, was patrimonial property
of the City of Manila and not a park or plaza.
Arguments of Petitioners
In G.R. No. L-41001, the Manila Lodge No. 761, BPOE, admits
that "there appears to be some logic in the conclusion" of the
Court of Appeals that "neither Act No. 1360 nor Act No. 1657
could have meant to supply the City of Manila the authority
to sell the subject property which is located at the south end
— not the north — of the reclaimed area." 16 It argues,
however, that when Act No. 1360, as amended, authorized
the City of Manila to undertake the construction of the
Luneta extension by reclaiming land from the Manila Bay, and
declared that the reclaimed land shall be the "property of the
City of Manila," the State expressly granted the ownership
thereof to the City of Manila which. consequently, could
enter into transactions involving it; that upon the issuance of
O.C.T. No. 1909, there could be no doubt that the reclaimed
area owned by the City was its patrimonial property; 17 that
the south end of the reclaimed area could not be for public
use for. as argued by TDC, a street, park or promenade can be
property for public use pursuant to Article 344 of the Spanish
Civil Code only when it has already been so constructed or
laid out, and the subject land, at the time it was sold to the
Elk’s Club, was neither actually constructed as a street, park
or promenade nor laid out as a street, park or promenade; 18
that even assuming that the subject property was at the
beginning property of public dominion, it was subsequently
converted into patrimonial property pursuant to Art. 422 of
the Civil Code, inasmuch as it had never been used, regarded,
or utilized since it was reclaimed in 1905 for purposes other
than that of an ordinary real estate for sale or lease; that the
subject property had never been intended for public use, is
further shown by the fact that it was neither included as a
part of the Luneta Park under Plan No. 30 of the National
Planning Commission nor considered a part of the Luneta
National Park (now Rizal Park) by Proclamation No. 234 dated
December 19, 1955 of President Ramon Magsaysay or by
Proclamation Order No. 274 dated October 4, 1967 of
President Ferdinand E. Marcos; 19 that, such being the case,
there is no reason why the subject property should not be
considered as having been converted into patrimonial
property, pursuant to the ruling in Municipality v. Roa, 7 Phil.
20, inasmuch as the City of Manila has considered it as its
patrimonial property not only bringing it under the operation
of the Land Registration Act but also by disposing of it; 20 and
that to consider now the subject property as a public plaza or
park would not only impair the obligations of the parties to
the contract of sale dated July 13, 1911, but also authorize
deprivation of property without due process of law. 21
G.R. No. L-41012
In L-41012, the petitioner TDC stresses that the principal issue
is the interpretation of Act No. 1360, as amended by Act No.
1657 of the Philippine Commission, 22 and avers that
inasmuch as Section 6 of Act No. 1360, as amended by Act
1657, provided that the reclamation of the Luneta extension
was to be paid for out of the funds of the City of Manila
which was authorized to borrow P350,000 "to be expended in
the construction of Luneta Extension," the reclaimed area
became "public land" belonging to the City of Manila that
spent for the reclamation, conformably to the holding in
Cabangis, 23 and consequently, said land was subject to sale
and other disposition; that the Insular Government itself
considered the reclaimed Luneta extension as patrimonial
property subject to disposition as evidenced by the fact that
Sec. 3 of Act 1360 declared that "the land hereby reclaimed
shall be the property of the City of Manila;" that this property
cannot be property for public use for, according to Article 344
of the Civil Code, the character of property for public use can
only attach to roads and squares that have already been
constructed or at least laid out as such, which conditions did
not obtain regarding the subject land; that Sec. 5 of Act 1360
authorized the City of Manila to lease the northern part of
the reclaimed area for hotel purposes; that Act No. 1657
furthermore authorized the City of Manila to sell the same;
24 that the express statutory authority to lease or sell the
northern part of the reclaimed area cannot be interpreted to
mean that the remaining area could not be sold inasmuch as
the purpose of the statute was not merely to confer authority
to sell the northern portion but rather to limit the city’s
power of disposition thereof, to wit: to prevent disposition of
the northern portion for any purpose other than for a hotel
site; 25 that the northern and southern ends of the reclaimed
area cannot be considered as extension of the Luneta for they
lie beyond the-sides of the original Luneta when extended in
the direction of the sea, and that is the reason why the law
authorized the sale of the northern portion for hotel
purposes, and, for the same reason, it is implied that the
southern portion could likewise be disposed of. 26
TDC argues likewise that there are several items of
uncontradicted circumstantial evidence which may serve as
aids in construing the legislative intent and which
demonstrate that the subject property is patrimonial in
nature, to wit: (1) Exhibits "J" and "J-1", or Plan No. 30 of the
National Planning Commission showing the Luneta and its
vicinity, do not include the subject property as part of the
Luneta Park; (2) Exhibit "K", which is the plan of the subject
property covered by TCT No. 67488 of BPOE, prepared on
November 11, 1963, indicates that said property is not a
public park; (3) Exhibit "T", which is a certified copy of
Proclamation No. 234 issued on December 15, 1955 by
President Magsaysay, and Exhibit "U" which is Proclamation
Order No. 273 issued on October 4, 1967 by President
Marcos, do not include the subject property in the Luneta
Park; (4) Exhibit "W", which is the location plan of the Luneta
National Park under Proclamations Nos. 234 and 273, further
confirms that the subject property is not a public park; and
(5) Exhibit "y", which is a copy of O.C.T. No. 7333 in the name
of the United States of America covering the land now
occupied by the American Embassy, the boundaries of which
were delineated by the Philippine Legislature, states that the
said land is bounded on the northwest by properties of the
Army and Navy Club (Block No. 321) and the Elks Club (Block
No. 321), and this circumstance shows that even the
Philippine Legislature recognized the subject property as
private property of the Elks Club. 27
TDC furthermore contends that the City of Manila is estopped
from questioning the validity of the sale of the subject
property that it executed on July 13, 1911 to the Manila
Lodge No. 761, BPOE, for several reasons, namely: (1) the
City’s petition for the reannotation of Entry No. 4608/T-1635
was predicated on the validity of said sale; (2) when the
property was bought by the petitioner TDC it was not a public
plaza or park as testified to by both Pedro Cojuangco,
treasurer of TDC, and the surveyor, Manuel Añonuevo; (4)
the property was never used as a public park, for, since the
issuance of T.C.T. No. 2165 on July 17, 1911 in the name of
the Manila Lodge NO. 761, the latter used it as private
property, and as early as January 16, 1909 the City of Manila
had already executed a deed of sale over the property in
favor of the Manila Lodge No. 761; and (5) the City of Manila
has not presented any evidence to show that the subject
property has ever been proclaimed or used as a public park.
28

TDC, moreover, contends that Sec. 60 of Com. Act No. 141
cannot apply to the subject land, for Com. Act No. 141 took
effect on December 1, 1936 and at that time the subject land
was no longer part of the public domain. 29
TDC also stresses that its rights as a purchaser in good faith
cannot be disregarded, for the mere mention in the
certificate of title that the lot it purchased was "part of the
Luneta extension" was not a sufficient warning that the title
of the City of Manila was invalid; and that although the trial
court, in its decision affirmed by the Court of Appeals, found
the TDC to have been an innocent purchaser for value, the
court disregarded the petitioner’s rights as such purchaser
that relied on a Torrens certificate of title. 30
The Court, continues the petitioner TDC, erred in not holding
that the latter is entitled to recover from the City of Manila
damages in the amount of P100,000 caused by the City’s
petition for reannotation of its right to repurchase.
DISCUSSION AND RESOLUTION OF FIRST ISSUE
It is a cardinal rule of statutory construction that courts must
give effect to the general legislative intent that can be
discovered from or is unraveled by the four corners of the
statute, 31 and in order to discover said intent, the whole
statute, and not only a particular provision thereof, should be
considered. 32 It is, therefore, necessary to analyze all the
provisions of Act No. 1360, as amended, in order to unravel
the legislative intent.
Act No. 1360 which was enacted by the Philippine
Commission on June 26, 1905, as amended by Act No. 1657
enacted on May 18, 1907, authorized the "construction of
such rock and timber bulkheads or sea walls as may be
necessary for the making of an extension to the Luneta" (Sec.
1[a]), and the placing of the material dredged from the
harbor of Manila "inside the bulkheads constructed to inclose
the Luneta extension above referred to" (Sec. 1[c]). It likewise
provided that the plan of Architect D. H. Burnham as "a
general outline for the extension and improvement of the
Luneta in the City of Manila" be adopted; that "the
reclamation from the Bay of Manila of the land included in
said projected Luneta extension . . . is hereby authorized and
the land thereby reclaimed shall be the property of the City of
Manila" (Sec. 3); that "the City of Manila is hereby authorized
to set aside a tract of the reclaimed land formed by the
Luneta extension authorized by this Act at the north end of
said tract, not to exceed five hundred feet by six hundred feet
in size, for a hotel site, and to lease the same with the
approval of the Governor General, . . . for a term not
exceeding ninety-nine years;" that "should the Municipal
Board . . . deem it advisable it is hereby authorized to
advertise for sale to sell said tract of land . . .;" "that said tract
shall be used for hotel purposes as herein prescribed, and
shall not be devoted to any other purpose or object
whatever;" "that should the grantee . . . fail to maintain on
said tract a first-class hotel . . . then the title to said tract of
land sold, conveyed, and transferred to the grantee shall
revert to the City of Manila, and said City of Manila shall
thereupon become entitled to the immediate possession of
said tract of land" (Sec. 3); that the construction of the rock
and timber bulkheads or sea wall "shall be paid for out of the
funds of the City of Manila, but the area to be reclaimed by
said proposed Luneta extension shall be filled, without cost to
the City of Manila, with material dredged from Manila Bay at
the expense of the Insular Government" (Sec. 6); and that
"the City of Manila is hereby authorized to borrow from the
Insular Government . . . the sum of three hundred thousand
pesos, to be expended in the construction of the Luneta
extension provided for by paragraph (a) of section one
hereof" (Sec. 7).
The grant made by Act No. 1360 of the reclaimed land to the
City of Manila is a grant of a "public" nature, the same having
been made to a local political subdivision. Such grants have
always been strictly construed against the grantee. 33 One
compelling reason given for the strict interpretation of a
public grant is that there is in such grant a gratuitous
donation of, public money or resources which results in an
unfair advantage to the grantee and for that reason, the
grant should be narrowly restricted in favor of the public. 34
This reason for strict interpretation obtains relative to the
aforesaid grant for although the City of Manila was to pay for
the construction of such work and timber bulkheads or sea
walls as may be necessary for the making of the Luneta
extension, the area to be reclaimed would be filled at the
expense of the Insular Government and without cost to the
City of Manila, with material dredged from Manila Bay.
Hence, the letter of the statute should be narrowed to
exclude matters which if included would defeat the policy of
the legislation.chanroblesvirtualawlibrary
The reclaimed area, an extension to the Luneta, is declared to
be property of the City of Manila. Property, however, is either
of public ownership or of private ownership. 35 What kind of
property of the City is the reclaimed land? Is it of public
ownership (dominion) or of private ownership?
We hold that it is of public dominion, intended for public use.
Firstly, if the reclaimed area was granted to the City of Manila
as its patrimonial property, the City could, by virtue of its
ownership, dispose of the whole reclaimed area without need
of authorization to do so from the lawmaking body. Thus
Article 348 of the Civil Code of Spain provides that
"ownership is the right to enjoy and dispose of a thing
without further limitations than those established by law." 36
The right to dispose (jus disponendi) of one’s property is an
attribute of ownership. Act No. 1360, as amended, however,
provides by necessary implication, that the City of Manila
could not dispose of the reclaimed area without being
authorized by the lawmaking body. Thus the statute provides
that "the City of Manila is hereby authorized to set aside a
tract . . . at the north end, for a hotel site, and to lease the
same . . . should the municipal board . . . deem it advisable, it
is hereby authorized . . . to sell said tract of land . . ." (Sec. 5).
If the reclaimed area were patrimonial property of the City,
the latter could dispose of it without need of the
authorization provided by the statute, and the authorization
to set aside . . . lease . . . or sell . . . given by the statute would
indeed be superfluous. To so construe the statute as to
render the term "authorize," which is repeatedly used by the
statute, superfluous would violate the elementary rule of
legal hermeneutics that effect must be given to every word,
clause, and sentence of the statute and that a statute should
be so interpreted that no part thereof becomes inoperative
or superflous. 37 To authorize means to empower, to give a
right to act. 38 Act No. 1360 furthermore qualifies the verb
"authorize" with the adverb "hereby," which means "by
means of this statue or section." Hence without the
authorization expressly given by Act No. 1360, the City of
Manila could not lease or sell even the northern portion;
much less could it dispose of the whole reclaimed area.
Consequently, the reclaimed area was granted to the City of
Manila, not as its patrimonial property. At most, only the
northern portion reserved as a hotel site could be said to be
patrimonial property, for, by express statutory provision it
could be disposed of, and the title thereto would revert to
the City should the grantee fail to comply with the terms
provided by the statute.chanrobles law library : red
TDC, however, contends that the purpose of the
authorization provided in Act No. 1360 to lease or sell was
really to limit the City’s power of disposition. To sustain such
contention is to beg the question. If the purpose of the law
was to limit the City’s power of disposition, then it is
necessarily assumed that the City had already the power to
dispose, for if such power did not exist, how could it be
limited? It was precisely Act 1360 that gave the City the
power to dispose — for it was "hereby authorized" — by
lease or sale. Hence, the City of Manila had no power to
dispose of the reclaimed land had such power not been
granted by Act No. 1360, and the purpose of the
authorization was to empower the city to sell or lease the
northern part and not, as TDC claims, to limit only the power
to dispose. Moreover, it is presumed that when the
lawmaking body enacted the statute, it had full knowledge of
prior and existing laws and legislation on the subject of the
statute and acted in accordance or with respect thereto. 39 If
by another previous law, the City of Manila could already
dispose of the reclaimed area, which it could do if such area
were given to it as its patrimonial property, would it then not
be a superfluity for Act No. 1360 to authorize the City to
dispose of the reclaimed land? Neither has petitioner TDC
pointed to any other law that authorized the City to do so,
nor have we come across any. What we do know is that if the
reclaimed land were patrimonial property, there would be no
need of giving special authorization to the City to dispose of
it. Said authorization was given because the reclaimed land
was not intended to be patrimonial property of the City of
Manila, and without the express authorization to dispose of
the northern portion, the City could not dispose of even that
part.chanrobles.com:cralaw:red
Secondly, the reclaimed area is an "extension to the Luneta in
the City of Manila." 40 If the reclaimed area is an extension of
the Luneta, then it is of the same nature or character as the
old Luneta. Anent this matter, it has been said that a power
to extend (or continue an act or business) cannot authorize a
transaction that is totally distinct. 41 It is not disputed that
the old Luneta is a public park or plaza and it is so considered
by Section 859 of the Revised Ordinances of the City of
Manila. 42 Hence the "extension to the Luneta" must be also
a public park or plaza and for public use.
TDC, however, contends that the subject property cannot be
considered an extension of the old Luneta because it is
outside of the limits of the old Luneta when extended to the
sea. This is a strained interpretation of the term "extension,"
for an "extension," it has been held, "signifies enlargement in
any direction — in length, breadth, or circumstance." 43
Thirdly, the reclaimed area was formerly a part of the Manila
Bay. A by is nothing more than an inlet of the sea. Pursuant to
Article 1 of the Law of Waters of 1866, bays, roadsteads,
coast sea, inlets and shores are parts of the national domain
open to public use. These are also property of public
ownership devoted to public use, according to Article 339 of
the Civil Code of Spain.
When the shore or part of the bay is reclaimed, it does not
lose its character of being property for public use, according
to Government of the Philippine Islands v. Cabangis. 44 The
predecessor of the claimants in this case was the owner of a
big tract of land including the lots is question. From 1896 said
land began to wear away due to the action of the water of
Manila Bay. In 1901 the lots in question became completely
submerged in water in ordinary tides. It remained in such a
state until 1912 when the Government undertook the
dredging of the Vitas estuary and dumped the sand and silt
from estuary on the low lands completely submerged in
water, thereby gradually forming the lots in question. Tomas
Cabangis took possession thereof as soon as they were
reclaimed; hence, the claimants, his successors in interest,
claimed that the lots belonged to them. The trial court found
for the claimants and the Government appealed. This Court
held that when the lots became a part of the shore. As they
remained in that condition until reclaimed by the filling done
by the Government, they belonged to the public domain for
public use. 45 Hence, a part of the shore, and for that
purpose, a part of the bay, did not lose its character of being
for public use after it was reclaimed.
Fourthly, Act 1360, as amended, authorized the lease or sale
of the northern portion of the reclaimed area as a hotel site.
The subject property is not that northern portion authorized
to be leased or sold; the subject property is the southern
portion. Hence, applying the rule of expresio unius est exlusio
alterius, the City of Manila was not authorized to sell the
subject property. The application of this principle of statutory
construction becomes the more imperative in the case at bar
inasmuch as not only must the public grant of the reclaimed
area to the City of Manila be, as above stated, strictly
construed against the City of Manila, but also because a grant
of power to a municipal corporation, as happens in this case
where the city is authorized to lease or sell the northern
portion of the Luneta extension, is strictly limited to such as
are expressly or impliedly authorized or necessarily incidental
to the objectives of the corporation.
Fifthly, Article 344 of the Civil Code of Spain provides that
"property of public use, in provinces and in towns, comprises
the provincial and town roads, the squares, streets, fountains,
and public waters, the promenades, and public works of
general service paid for by such towns or provinces." A park
or plaza, such as the extension to the Luneta, is undoubtedly
comprised in said article.
The petitioners, however, argue that, according to said Article
344, in order that the character of property for public use
may be so attached to a plaza, the latter must be actually
constructed or at least laid out as such, and since the subject
property was not yet constructed as a plaza or at least laid
out as a plaza when it was sold by the City, it could not be
property for public use. It should be noted, however, that
properties of provinces and towns for public use are
governed by the same principles as properties of the same
character belonging to the public domain. 46 In order to be
property of public domain an intention to devote it to public
use is sufficient. 47 The petitioners’ contention is refuted by
Manresa himself who said, in his comments 48 on Article 344,
that:jgc:chanrobles.com.ph
"Las plazas, calles y paseos publicos corresponden, sin duda
alguna, aldominio publico municipal, porque se hallan
establecidos sobre suelo municipal y estan destinadas al uso
de todos. Laurent presenta, tratando de las Plazas, una
cuestion relativa a si deben conceptuarse como de dominio
publico los lugares vacios, libres, que se encuentran en los
Municipios rurales. . . . Laurent opina contra Proudhon, que
toda vez que estan al servicio de todos esos lugares, deben
considerarse publicos y de dominio publico. Realmente, para
decidir el punto, bastara siempre fijarse en el destino real y
efectivo de los citados lugares, y si este destino entraña un
uso comun de todos, no hay duda que son de dominio
municipal si no patrimoniales."cralaw virtua1aw library
It is not necessary, therefore, that a plaza be already
construed or laid out as a plaza in order that it be considered
property for public use. It is sufficient that it be intended to
be such. In the case at bar, it has been shown that the
intention of the lawmaking body in giving to the City of
Manila the extension to the Luneta was not a grant to it of
patrimonial property but a grant for public use as a plaza.
We have demonstrated ad satietatem that the Luneta
extension was intended to be property of the City of Manila
for public use. But, could not said property later on be
converted, as the petitioners contend, to patrimonial
property? It could be. But this Court has already said, in
Ignacio v. The Director of Lands, 49 that it is only the
executive and possibly the legislative department that has the
authority and the power to make the declaration that said
property is no longer required for public use, and until such
declaration is made the property must continue to form part
of the public domain. In the case at bar, there has been no
such explicit or unequivocal declaration. It should be noted,
furthermore, anent this matter, that courts are undoubtedly
not primarily called upon, and are not in a position, to
determine whether any public land is still needed for the
purposes specified in Article 4 of the Law of Waters. 50
Having disposed of the petitioners’ principal arguments
relative to the main issue, we now pass to the items of
circumstantial evidence which TDC claims may serve as aids
in construing the legislative intent in the enactment of Act
No. 1360, as amended. It is noteworthy that all these items of
alleged circumstantial evidence are acts far removed in time
from the date of the enactment of Act No. 1360 such that
they cannot be considered contemporaneous with its
enactment. Moreover, it is not far-fetched that this mass of
circumstantial evidence might have been influenced by the
antecedent series of invalid acts, to wit: the City’s having
obtained over the reclaimed area OCT No. 1909 on January
20, 1911; the sale made by the City of the subject property to
Manila Lodge No. 761; and the issuance to the latter of T.C.T.
No. 2195. It cannot be gainsaid that if the subsequent acts
constituting the circumstantial evidence have been based on,
or at least influenced, by those antecedent invalid acts and
Torrens titles, they can hardly be indicative of the intent of
the lawmaking body in enacting Act No. 1360 and its
amendatory act.cralawnad
TDC claims that Exhs. "J," "J-1," "K," "T," "U," "W" and "Y"
show that the subject property is not a park.
Exhibits "J" and "J-1," the "Luneta and vicinity showing
proposed development" dated May 14, 1949, were prepared
by the National Urban Planning Commission of the Office of
the President. It cannot be reasonably expected that this plan
for development of the Luneta should show that the subject
property occupied by the Elks Club is a public park, for it was
made 38 years after the sale to the Elks, and after T.C.T. No.
2195 had been issued to Elks. It is to be assumed that the
Office of the President was cognizant of the Torrens title of
BPOE. That the subject property was not included as a part of
the Luneta only indicates that the National Urban Planning
Commission that made the plan knew that the subject
property was occupied by Elks and that Elks had a Torrens
title thereto. But this in no way proves that the subject
property was originally intended to be patrimonial property
of the City of Manila or that the sale to Elks or that the
Torrens title of the latter is valid.
Exhibit "K" is the "Plan of land covered by T.C.T. No. ____, as
prepared for Tarlac Development Company." It was made on
November 11, 1963 by Felipe F. Cruz, private land surveyor.
This surveyor is admittedly a surveyor for TDC. 51 This plan
cannot be expected to show that the subject property is a
part of the Luneta Park, for the plan was made to show the
lot that "was to be sold to petitioner" This plan must have
also assumed the existence of a valid title to the land in favor
of Elks.
Exhibits "T" and "U" are copies of Presidential Proclamations
No. 234 issued on November 15, 1955 and No. 273 issued on
October 4, 1967, respectively. The purpose of the said
Proclamations was to reserve certain parcels of land situated
in the District of Ermita, City of Manila, for park site purposes.
Assuming that the subject property is not within the
boundaries of the reservation, this cannot be interpreted to
mean that the subject property was not originally intended to
be for public use or that it has ceased to be such. Conversely
had the subject property been included in the reservation, it
would not mean, if it really were private property, that the
rights of the owners thereof would be extinguished, for the
reservations was "subject to private rights, if any there be."
That the subject property was not included in the reservation
only indicates that the President knew of the existence of the
Torrens titles mentioned above. The failure of the
Proclamations to include the subject property in the
reservation for park site could not change the character of
the subject property as originally for public use and to form
part of the Luneta Park. What has been said here applies to
Exhibits "V", "V-1" to "V-3," and "W" which also refer to the
area and location of the reservation for the Luneta
Park.chanrobles virtualawlibrary
chanrobles.com:chanrobles.com.ph
Exhibit "Y" is a copy of O.C.T. No. 7333 dated November 13,
1935, covering the lot where now stands the American
Embassy [Chancery]. It states that the property is "bounded .
. . on the Northwest by properties of Army and Navy Club
(Block No. 321) and Elks Club (Block No. 321)." Inasmuch as
the said boundaries were delineated by the Philippine
Legislature in Act No. 4269, the petitioners contend that the
Legislature "recognized and conceded the existence of the
Elks Club property as a private property (the property is
question) and not as a public park or plaza. This argument is
non sequitur, plain and simple. Said Original Certificate of
Title cannot be considered as an inconvertible declaration
that the Elks Club was in truth and in fact the owner of such
boundary lot. Such mention as boundary owner is not a
means of acquiring title nor can it validate a title that is null
and void.
TDC finally claims that the City of Manila is estopped from
questioning the validity of the sale it executed on July 13,
1911 conveying the subject property to the Manila Lodge No.
761, BPOE. This contention cannot be seriously defended in
the light of the doctrine repeatedly enunciated by this Court
that the Government is never estopped by mistakes or errors
on the part. of its agents, and estoppel does not apply to a
municipal corporation to validate a contract that is prohibited
by law or its against public policy, and the sale of July 13,
1911 executed by the city of Manila to Manila Lodge was
certainly a contract prohibited by law. Moreover, estoppel
cannot be urged even if the City of Manila accepted the
benefits of such contract of sale and the Manila Lodge No.
761 had performed its part of the agreement, for to apply the
doctrine of estoppel against the City of Manila in this case
would be tantamount to enabling it to do indirectly what it
could not do directly. 52
The sale of the subject property executed by the City of
Manila to the Manila Lodge No. 761, BPOE, was void and
inexistent for lack of subject matter. 53 It suffered from an
incurable defect that could not be ratified either by lapse of
time or by express ratification. The Manila Lodge No. 761
therefore acquired no right by virtue of the said sale. Hence
to consider now the contract inexistent as it always has been,
cannot be, as claimed by the Manila Lodge No. 761, an
impairment of the obligations of contracts, for there was in
contemplation of law, no contract at all.chanrobles virtual
lawlibrary
The inexistence of said sale can be set up against anyone who
asserts a right arising from it, not only against the first
vendee, the Manila Lodge No. 761, BPOE, but also against all
its successors, including, the TDC, which are not protected by
law. 54 The doctrine of bona fide purchaser without notice,
being claimed by the TDC, does not apply where there is a
total absence of title in the vendor, and the good faith of the
purchaser TDC cannot create title where none exists. 55
The so-called sale of the subject property having been
executed, the restoration or restitution of what has been
given is in order. 56
SECOND ISSUE

The second ground alleged in support of the instant petitions

for review on certiorari is that the Court of Appeals has
departed from the accepted and usual course of judicial
proceedings as to call for an exercise of the power of
supervision TDC, in L-41012, argues that the respondent
Court did not make its own findings but simply recited those
of the lower court and made a general affirmance, contrary
to the requirements of the Constitution; that the respondent
Court made glaring and patent mistakes in recounting even
the copied findings, palpably showing lack of deliberate
consideration of the matters involved, as, for example, when
said court said that Act No. 1657 authorized the City of
Manila to set aside a portion of the reclaimed land "formed
by the Luneta Extension or to lease or sell the same for park
purposes;" and that respondent Court, furthermore, did not
resolve or dispose of any of the assigned errors contrary to
the mandate of the Judiciary Act. 57

The Manila Lodge No. 761, in L-41001, likewise alleges, as one

of the reasons warranting review, that the Court of Appeals
departed from the accepted and usual course of judicial
proceedings by simply making a general affirmance of the
court a quo’s findings without bothering to resolve several
vital points mentioned by the BPOE in its assigned errors. 58

COMMENTS ON SECOND ISSUE

We have shown in our discussion of the first issue that the

decision of the trial court is fully in accordance with law. It
follows that when such decision was affirmed by the Court of
Appeals, the affirmance was likewise in accordance with law.
Hence, no useful purpose will be served in further discussing
the second issue.

CONCLUSION

ACCORDINGLY, the petitions in both G.R. Nos. L-41001 and L-

41012 are denied for lack of merit, and the decision of the
Court of Appeals of June 30, 1975, is hereby affirmed, at
petitioners’ cost.

Makasiar, Muñoz Palma and Martin, JJ., concur.

Teehankee, J., concurs in the result which is wholly consistent

with the basic rulings and judgment of this Court in its
decision of July 31, 1968.