G.R. No.
L-630            November 15, 1947 court to voice its conviction in a future case may be remote, with the result
ALEXANDER A. KRIVENKO, petitioner-appellant,
vs.
THE REGISTER OF DEEDS, CITY OF MANILA, respondent and appellee.
Gibbs, Gibbs, Chuidian and Quasha of petitioner-appellant.
First Assistant Solicitor General Reyes and Solicitor Carreon for respondent-
appellee.
Marcelino Lontok appeared as amicus curies.
MORAN, C.J.:
Alenxander A. Kriventor alien, bought a residential lot from the Magdalena
Estate, Inc., in December of 1941, the registration of which was interrupted
by the war. In May, 1945, he sought to accomplish said registration but was
denied by the register of deeds of Manila on the ground that, being an alien,
he cannot acquire land in this jurisdiction. Krivenko then brought the case to
the fourth branch of the Court of First Instance of Manila by means of
a consulta, and that court rendered judgment sustaining the refusal of the
register of deeds, from which Krivenko appealed to this Court.
There is no dispute as to these facts. The real point in issue is whether or not
an alien under our Constitution may acquire residential land.
It is said that the decision of the case on the merits is unnecessary, there
being a motion to withdraw the appeal which should have been granted
outright, and reference is made to the ruling laid down by this Court in
another case to the effect that a court should not pass upon a constitutional
question if its judgment may be made to rest upon other grounds. There is,
we believe, a confusion of ideas in this reasoning. It cannot be denied that
the constitutional question is unavoidable if we choose to decide this case
upon the merits. Our judgment cannot to be made to rest upon other
grounds if we have to render any judgment at all. And we cannot avoid our
judgment simply because we have to avoid a constitutional question. We
cannot, for instance, grant the motion withdrawing the appeal only because
we wish to evade the constitutional; issue. Whether the motion should be, or
should not be, granted, is a question involving different considerations now
to be stated.
According to Rule 52, section 4, of the Rules of Court, it is discretionary upon
this Court to grant a withdrawal of appeal after the briefs have been
presented. At the time the motion for withdrawal was filed in this case, not
only had the briefs been prensented, but the case had already been voted
and the majority decision was being prepared. The motion for withdrawal
stated no reason whatsoever, and the Solicitor General was agreeable to it.
While the motion was pending in this Court, came the new circular of the
Department of Justice, instructing all register of deeds to accept for
registration all transfers of residential lots to aliens. The herein respondent-
appellee was naturally one of the registers of deeds to obey the new circular,
as against his own stand in this case which had been maintained by the trial
court and firmly defended in this Court by the Solicitor General. If we grant
the withdrawal, the the result would be that petitioner-appellant Alexander
A. Krivenko wins his case, not by a decision of this Court, but by the decision
or circular of the Department of Justice, issued while this case was pending
before this Court. Whether or not this is the reason why appellant seeks the
withdrawal of his appeal and why the Solicitor General readily agrees to that
withdrawal, is now immaterial. What is material and indeed very important,
is whether or not we should allow interference with the regular and
complete exercise by this Court of its constitutional functions, and whether
or not after having held long deliberations and after having reached a clear
and positive conviction as to what the constitutional mandate is, we may still
allow our conviction to be silenced, and the constitutional mandate to be
ignored or misconceived, with all the harmful consequences that might be
brought upon the national patromony. For it is but natural that the new
circular be taken full advantage of by many, with the circumstance that
perhaps the constitutional question may never come up again before this
court, because both vendors and vendees will have no interest but to uphold
the validity of their transactions, and very unlikely will the register of deeds
venture to disobey the orders of their superior. Thus, the possibility for this
that our indifference of today might signify a permanent offense to the
Constitution.
All thse circumstances were thoroughly considered and weighted by this
Court for a number of days and the legal result of the last vote was a denial
of the motion withdrawing the appeal. We are thus confronted, at this stage
of the proceedings, with our duty, the constitutional question becomes
unavoidable. We shall then proceed to decide that question.
Article XIII, section 1, of the Constitutional is as follows:
Article XIII. — Conservation and utilization of natural resources.
SECTION 1. All agricultural, timber, and mineral lands of the public domain,
water, minerals, coal, petroleum, and other mineral oils, all forces of
potential energy, and other natural resources of the Philippines belong to the
State, and their disposition, exploitation, development, or utilization shall be
limited to citizens of the Philippines, or to corporations or associations at
least sixty per centum of the capital of which is owned by such citizens,
subject to any existing right, grant, lease, or concession at the time of the
inaguration of the Government established uunder this Constitution. Natural
resources, with the exception of public agricultural land, shall not be
alienated, and no licence, concession, or lease for the exploitation,
development, or utilization of any of the natural resources shall be granted
for a period exceeding twenty-five years, renewable for another twenty-five
years, except as to water rights for irrigation, water supply, fisheries, or
industrial uses other than the development of water "power" in which cases
beneficial use may be the measure and the limit of the grant.
The scope of this constitutional provision, according to its heading and its
language, embraces all lands of any kind of the public domain, its purpose
being to establish a permanent and fundamental policy for the conservation
and utilization of all natural resources of the Nation. When, therefore, this
provision, with reference to lands of the public domain, makes mention of
only agricultural, timber and mineral lands, it means that all lands of the
public domain are classified into said three groups, namely, agricultural,
timber and mineral. And this classification finds corroboration in the
circumstance that at the time of the adoption of the Constitution, that was
the basic classification existing in the public laws and judicial decisions in the
Philippines, and the term "public agricultural lands" under said classification
had then acquired a technical meaning that was well-known to the members
of the Constitutional Convention who were mostly members of the legal
profession.
As early as 1908, in the case of Mapa vs. Insular Government (10 Phil., 175,
182), this Court said that the phrase "agricultural public lands" as defined in
the Act of Congress of July 1, 1902, which phrase is also to be found in
several sections of the Public Land Act (No. 926), means "those public lands
acquired from Spain which are neither mineral for timber lands." This
definition has been followed in long line of decisions of this Court.
(See Montano vs. Insular Government, 12 Phil., 593; Ibañez de Aldecoa vs.
Insular Government, 13 Phil., 159; Ramos vs. Director of Lands, 39 Phil., 175;
Jocson vs. Director of Forestry, 39 Phil., 560; Ankron vs. Government of the
Philippines, 40 Phil., 10.) And with respect to residential lands, it has been
held that since they are neither mineral nor timber lands, of necessity they
must be classified as agricultural. In Ibañez de Aldecoa vs. Insular
Government (13 Phil., 159, 163), this Court said:
Hence, any parcel of land or building lot is susceptible of cultivation, and may
be converted into a field, and planted with all kinds of vegetation; for this
reason, where land is not mining or forestal in its nature, it must necessarily
be included within the classification of agricultural land, not because it is
actually used for the purposes of agriculture, but because it was originally
agricultural and may again become so under other circumstances; besides,
the Act of Congress contains only three classification, and makes no special
provision with respect to building lots or urban lands that have ceased to be
agricultural land.
In other words, the Court ruled that in determining whether a parcel of land
is agricultural, the test is not only whether it is actually agricultural, but also
its susceptibility to cultivation for agricultural purposes. But whatever the
test might be, the fact remains that at the time the Constitution was
adopted, lands of the public domain were classified in our laws and
jurisprudence into agricultural, mineral, and timber, and that the term
"public agricultural lands" was construed as referring to those lands that
were not timber or mineral, and as including residential lands. It may safely
be presumed, therefore, that what the members of the Constitutional
Convention had in mind when they drafted the Constitution was this well-
known classification and its technical meaning then prevailing.
Certain expressions which appear in Constitutions, . . . are obviously
technical; and where such words have been in use prior to the adoption of a
Constitution, it is presumed that its framers and the people who ratified it
have used such expressions in accordance with their technical meaning. (11
Am. Jur., sec. 66, p. 683.) Also Calder vs. Bull, 3 Dall. [U.S.], 386; 1 Law. ed.,
648; Bronson vs. Syverson, 88 Wash., 264; 152 P., 1039.)
It is a fundamental rule that, in construing constitutions, terms employed
therein shall be given the meaning which had been put upon them, and
which they possessed, at the time of the framing and adoption of the
instrument. If a word has acquired a fixed, technical meaning in legal and
constitutional history, it will be presumed to have been employed in that
sense in a written Constitution. (McKinney vs. Barker, 180 Ky., 526; 203 S.W.,
303; L.R.A., 1918 E, 581.)
Where words have been long used in a technical sense and have been
judicially construed to have a certain meaning, and have been adopted by
the legislature as having a certain meaning prior to a particular statute in
which they are used, the rule of construction requires that the words used in
such statute should be construed according to the sense in which they have
been so previously used, although the sense may vary from strict literal
meaning of the words. (II Sutherland, Statutory Construction, p. 758.)
Therefore, the phrase "public agricultural lands" appearing in section 1 of
Article XIII of the Constitution must be construed as including residential
lands, and this is in conformity with a legislative interpretation given after the
adoption of the Constitution. Well known is the rule that "where the
Legislature has revised a statute after a Constitution has been adopted, such
a revision is to be regarded as a legislative construction that the statute so
revised conforms to the Constitution." (59 C.J., 1102.) Soon after the
Constitution was adopted, the National Assembly revised the Public Land Law
and passed Commonwealth Act No. 141, and sections 58, 59 and 60 thereof
permit the sale of residential lots to Filipino citizens or to associations or
corporations controlled by such citizens, which is equivalent to a solemn
declaration that residential lots are considered as agricultural lands, for,
under the Constitution, only agricultural lands may be alienated.
It is true that in section 9 of said Commonwealth Act No. 141, "alienable or
disposable public lands" which are the same "public agriculture lands" under
the Constitution, are classified into agricultural, residential, commercial,
industrial and for other puposes. This simply means that the term "public
agricultural lands" has both a broad and a particular meaning. Under its
broad or general meaning, as used in the Constitution, it embraces all lands
that are neither timber nor mineral. This broad meaning is particularized in
section 9 of Commonwealth Act No. 141 which classifies "public agricultural
lands" for purposes of alienation or disposition, into lands that are stricly
agricultural or actually devoted to cultivation for agricultural puposes; lands
that are residential; commercial; industrial; or lands for other purposes. The
fact that these lands are made alienable or disposable under Commonwealth
Act No. 141, in favor of Filipino citizens, is a conclusive indication of their
character as public agricultural lands under said statute and under the
Constitution.
It must be observed, in this connection that prior to the Constitution, under
section 24 of Public Land Act No. 2874, aliens could acquire public
agricultural lands used for industrial or residential puposes, but after the
Constitution and under section 23 of Commonwealth Act No. 141, the right
of aliens to acquire such kind of lands is completely stricken out,
undoubtedly in pursuance of the constitutional limitation. And, again, prior
to the Constitution, under section 57 of Public Land Act No. 2874, land of the
public domain suitable for residence or industrial purposes could be sold or
leased to aliens, but after the Constitution and under section 60 of
Commonwealth Act No. 141, such land may only be leased, but not sold, to
aliens, and the lease granted shall only be valid while the land is used for the
purposes referred to. The exclusion of sale in the new Act is undoubtedly in
pursuance of the constitutional limitation, and this again is another
legislative construction that the term "public agricultural land" includes land
for residence purposes.
Such legislative interpretation is also in harmony with the interpretation
given by the Executive Department of the Government. Way back in 1939,
Secretary of Justice Jose Abad Santos, in answer to a query as to "whether or
not the phrase 'public agricultural lands' in section 1 of Article XII (now XIII) of
the Constitution may be interpreted to include residential, commercial, and
industrial lands for purposes of their disposition," rendered the following
short, sharp and crystal-clear opinion:
Section 1, Article XII (now XIII) of the Constitution classifies lands of the
public domain in the Philippines into agricultural, timber and mineral. This is
the basic classification adopted since the enactment of the Act of Congress of
July 1, 1902, known as the Philippine Bill. At the time of the adoption of the
Constitution of the Philippines, the term 'agricultural public lands' and,
therefore, acquired a technical meaning in our public laws. The Supreme
Court of the Philippines in the leading case of Mapa vs. Insular
Government, 10 Phil., 175, held that the phrase 'agricultural public lands'
means those public lands acquired from Spain which are neither timber nor
mineral lands. This definition has been followed by our Supreme Court in
many subsequent case. . . .
Residential commercial, or industrial lots forming part of the public domain
must have to be included in one or more of these classes. Clearly, they are
neither timber nor mineral, of necessity, therefore, they must be classified as
agricultural.
Viewed from another angle, it has been held that in determining whether
lands are agricultural or not, the character of the land is the test
(Odell vs. Durant, 62 N.W., 524; Lorch vs. Missoula Brick and Tile Co., 123
p.25). In other words, it is the susceptibility of the land to cultivation for
agricultural purposes by ordinary farming methods which determines
whether it is agricultural or not (State vs. Stewart, 190 p. 129).
Furthermore, as said by the Director of Lands, no reason is seen why a piece
of land, which may be sold to a person if he is to devote it to agricultural,
cannot be sold to him if he intends to use it as a site for his home.
This opinion is important not alone because it comes from a Secratary of
Justice who later became the Chief Justice of this Court, but also because it
was rendered by a member of the cabinet of the late President Quezon who
actively participated in the drafting of the constitutional provision under
consideration. (2 Aruego, Framing of the Philippine Constitution, p. 598.) And
the opinion of the Quezon administration was reiterated by the Secretary of
Justice under the Osmeña administration, and it was firmly maintained in this
Court by the Solicitor General of both administrations.
It is thus clear that the three great departments of the Government —
judicial, legislative and executive — have always maintained that lands of the
public domain are classified into agricultural, mineral and timber, and that
agricultural lands include residential lots.
Under section 1 of Article XIII of the Constitution, "natural resources, with
the exception of public agricultural land, shall not be aliented," and with
respect to public agricultural lands, their alienation is limited to Filipino
citizens. But this constitutional purpose conserving agricultural resources in
the hands of Filipino citizens may easily be defeated by the Filipino citizens
themselves who may alienate their agricultural lands in favor of aliens. It is
partly to prevent this result that section 5 is included in Article XIII, and it
reads as follows:
Sec. 5. Save in cases of hereditary succession, no private agricultural land will
be transferred or assigned except to individuals, corporations, or associations
qualified to acquire or hold lands of the public domain in the Philippines.
This constitutional provision closes the only remaining avenue through which
agricultural resources may leak into aliens' hands. It would certainly be futile
to prohibit the alienation of public agricultural lands to aliens if, after all, they
may be freely so alienated upon their becoming private agricultural lands in
the hands of Filipino citizens. Undoubtedly, as above indicated, section 5 is
intended to insure the policy of nationalization contained in section 1. Both
sections must, therefore, be read together for they have the same purpose
and the same subject matter. It must be noticed that the persons against
whom the prohibition is directed in section 5 are the very same persons who
under section 1 are disqualified "to acquire or hold lands of the public
domain in the Philippines." And the subject matter of both sections is the
same, namely, the non-transferability of "agricultural land" to aliens. Since
"agricultural land" under section 1 includes residential lots, the same
technical meaning should be attached to "agricultural land under section 5. It
is a rule of statutory construction that "a word or phrase repeated in a
statute will bear the same meaning throughout the statute, unless a different
intention appears." (II Sutherland, Statutory Construction, p. 758.) The only
difference between "agricultural land" under section 5, is that the former is
public and the latter private. But such difference refers to ownership and not
to the class of land. The lands are the same in both sections, and, for the
conservation of the national patrimony, what is important is the nature or
class of the property regardless of whether it is owned by the State or by its
citizens.
Reference is made to an opinion rendered on September 19, 1941, by the
Hon. Teofilo Sison, then Secretary of Justice, to the effect that residential
lands of the public domain may be considered as agricultural lands, whereas
residential lands of private ownership cannot be so considered. No reason
whatsoever is given in the opinion for such a distinction, and no valid reason
can be adduced for such a discriminatory view, particularly having in mind
that the purpose of the constitutional provision is the conservation of the
national patrimony, and private residential lands are as much an integral part
of the national patrimony as the residential lands of the public domain.
Specially is this so where, as indicated above, the prohibition as to the
alienable of public residential lots would become superflous if the same
prohibition is not equally applied to private residential lots. Indeed, the
prohibition as to private residential lands will eventually become more
important, for time will come when, in view of the constant disposition of
public lands in favor of private individuals, almost all, if not all, the residential
lands of the public domain shall have become private residential lands.
It is maintained that in the first draft of section 5, the words "no land of
private ownership" were used and later changed into "no agricultural land of
private ownership," and lastly into "no private agricultural land" and from
these changes it is argued that the word "agricultural" introduced in the
second and final drafts was intended to limit the meaning of the word "land"
to land actually used for agricultural purposes. The implication is not
accurate. The wording of the first draft was amended for no other purpose
than to clarify concepts and avoid uncertainties. The words "no land" of the
first draft, unqualified by the word "agricultural," may be mistaken to include
timber and mineral lands, and since under section 1, this kind of lands can
never be private, the prohibition to transfer the same would be superfluous.
Upon the other hand, section 5 had to be drafted in harmony with section 1
to which it is supplementary, as above indicated. Inasmuch as under section
1, timber and mineral lands can never be private, and the only lands that
may become private are agricultural lands, the words "no land of private
ownership" of the first draft can have no other meaning than "private
agricultural land." And thus the change in the final draft is merely one of
words in order to make its subject matter more specific with a view to
avoiding the possible confusion of ideas that could have arisen from the first
draft.
If the term "private agricultural lands" is to be construed as not including
residential lots or lands not strictly agricultural, the result would be that
"aliens may freely acquire and possess not only residential lots and houses
for themselves but entire subdivisions, and whole towns and cities," and that
"they may validly buy and hold in their names lands of any area for building
homes, factories, industrial plants, fisheries, hatcheries, schools, health and
vacation resorts, markets, golf courses, playgrounds, airfields, and a host of
other uses and purposes that are not, in appellant's words, strictly
agricultural." (Solicitor General's Brief, p. 6.) That this is obnoxious to the
conservative spirit of the Constitution is beyond question.
One of the fundamental principles underlying the provision of Article XIII of
the Constitution and which was embodied in the report of the Committee on
Nationalization and Preservation of Lands and other Natural Resources of the
Constitutional Convention, is "that lands, minerals, forests, and other natural
resources constitute the exclusive heritage of the Filipino nation. They
should, therefore, be preserved for those under the sovereign authority of
that nation and for their posterity." (2 Aruego, Framing of the Filipino
Constitution, p. 595.) Delegate Ledesma, Chairman of the Committee on
Agricultural Development of the Constitutional Convention, in a speech
delivered in connection with the national policy on agricultural lands, said:
"The exclusion of aliens from the privilege of acquiring public agricultural
lands and of owning real estate is a necessary part of the Public Land Laws of
the Philippines to keep pace with the idea of preserving the Philippines for
the Filipinos." (Emphasis ours.) And, of the same tenor was the speech of
Delegate Montilla who said: "With the complete nationalization of our lands
and natural resources it is to be understood that our God-given birthright
should be one hundred per cent in Filipino hands . . .. Lands and natural
resources are immovables and as such can be compared to the vital organs of
a person's body, the lack of possession of which may cause instant death or
the shortening of life. If we do not completely antionalize these two of our
most important belongings, I am afraid that the time will come when we shall
be sorry for the time we were born. Our independence will be just a
mockery, for what kind of independence are we going to have if a part of our
country is not in our hands but in those of foreigners?" (Emphasis ours.)
Professor Aruego says that since the opening days of the Constitutional
Convention one of its fixed and dominating objectives was the conservation
and nationalization of the natural resources of the country. (2 Aruego,
Framing of the Philippine Constitution, p 592.) This is ratified by the members
of the Constitutional Convention who are now members of this Court,
namely, Mr. Justice Perfecto, Mr. Justice Briones, and Mr. Justice Hontiveros.
And, indeed, if under Article XIV, section 8, of the Constitution, an alien may
not even operate a small jitney for hire, it is certainly not hard to understand
that neither is he allowed to own a pieace of land.
This constitutional intent is made more patent and is strongly implemented
by an act of the National Assembly passed soon after the Constitution was
approved. We are referring again to Commonwealth Act No. 141. Prior to the
Constitution, there were in the Public Land Act No. 2874 sections 120 and
121 which granted aliens the right to acquire private only by way of
reciprocity. Said section reads as follows:
SEC. 120. No land originally acquired in any manner under the provisions of
this Act, nor any permanent improvement on such land, shall be
encumbered, alienated, or transferred, except to persons, corporations,
associations, or partnerships who may acquire lands of the public domain
under this Act; to corporations organized in the Philippine Islands authorized
therefor by their charters, and, upon express authorization by the Philippine
Legislature, to citizens of countries the laws of which grant to citizens of the
Philippine Islands the same right to acquire, hold, lease, encumber, dispose
of, or alienate land, or permanent improvements thereon, or any interest
therein, as to their own citizens, only in the manner and to the extent
specified in such laws, and while the same are in force but not thereafter.
SEC. 121. No land originally acquired in any manner under the provisions of
the former Public Land Act or of any other Act, ordinance, royal order, royal
decree, or any other provision of law formerly in force in the Philippine
Islands with regard to public lands, terrenos baldios y realengos, or lands of
any other denomination that were actually or presumptively of the public
domain or by royal grant or in any other form, nor any permanent
improvement on such land, shall be encumbered, alienated, or conveyed,
except to persons, corporations, or associations who may acquire land of the
public domain under this Act; to corporate bodies organized in the Philippine
Islands whose charters may authorize them to do so, and, upon express
authorization by the Philippine Legislature, to citizens of the countries the
laws of which grant to citizens of the Philippine Islands the same right to
acquire, hold, lease, encumber, dispose of, or alienate land or pemanent
improvements thereon or any interest therein, as to their own citizens, and
only in the manner and to the extent specified in such laws, and while the
same are in force, but not thereafter: Provided, however, That this
prohibition shall not be applicable to the conveyance or acquisition by reason
of hereditary succession duly acknowledged and legalized by competent
courts, nor to lands and improvements acquired or held for industrial or
residence purposes, while used for such purposes: Provided, further, That in
the event of the ownership of the lands and improvements mentioned in this
section and in the last preceding section being transferred by judicial decree
to persons,corporations or associations not legally capacitated to acquire the
same under the provisions of this Act, such persons, corporations, or
associations shall be obliged to alienate said lands or improvements to others
so capacitated within the precise period of five years, under the penalty of
such property reverting to the Government in the contrary case." (Public
Land Act, No. 2874.)
It is to be observed that the pharase "no land" used in these section refers to
all private lands, whether strictly agricultural, residential or otherwise, there
being practically no private land which had not been acquired by any of the
means provided in said two sections. Therefore, the prohibition contained in
these two provisions was, in effect, that no private land could be transferred
to aliens except "upon express authorization by the Philippine Legislature, to
citizens of Philippine Islands the same right to acquire, hold, lease,
encumber, dispose of, or alienate land." In other words, aliens were granted
the right to acquire private land merely by way of reciprocity. Then came the
Constitution and Commonwealth Act No. 141 was passed, sections 122 and
123 of which read as follows:
SEC. 122. No land originally acquired in any manner under the provisions of
this Act, nor any permanent improvement on such land, shall be
encumbered, alienated, or transferred, except to persons, corporations,
associations, or partnerships who may acquire lands of the public domain
under this Act or to corporations organized in the Philippines authorized
thereof by their charters.
SEC. 123. No land originally acquired in any manner under the provisions of
any previous Act, ordinance, royal order, royal decree, or any other provision
of law formerly in force in the Philippines with regard to public
lands terrenos baldios y realengos, or lands of any other denomination that
were actually or presumptively of the public domain, or by royal grant or in
any other form, nor any permanent improvement on such land, shall be
encumbered, alienated, or conveyed, except to persons, corporations or
associations who may acquire land of the public domain under this Act or to
corporate bodies organized in the Philippines whose charters authorize them
to do so: Provided, however, That this prohibition shall not be applicable to
the conveyance or acquisition by reason of hereditary succession duly
acknowledged and legalized by competent courts: Provided, further, That in
the event of the ownership of the lands and improvements mentioned in this
section and in the last preceding section being transferred by judicial decree
to persons, corporations or associations not legally capacitated to acquire
the same under the provisions of this Act, such persons, corporations, or
associations shall be obliged to alienate said lands or improvements to others
so capacitated within the precise period of five years; otherwise, such
property shall revert to the Government.
These two sections are almost literally the same as sections 120 and 121 of
Act No. 2874, the only difference being that in the new provisions, the right
to reciprocity granted to aliens is completely stricken out. This, undoubtedly,
is to conform to the absolute policy contained in section 5 of Article XIII of
the Constitution which, in prohibiting the alienation of private agricultural
lands to aliens, grants them no right of reciprocity. This legislative
construction carries exceptional weight, for prominent members of the
National Assembly who approved the new Act had been members of the
Constitutional Convention.
It is said that the lot question does not come within the purview of sections
122 and 123 of Commonwealth Act No. 141, there being no proof that the
same had been acquired by one of the means provided in said provisions. We
are not, however, diciding the instant case under the provisions of the Public
Land Act, which have to refer to land that had been formerly of the public
domain, otherwise their constitutionality may be doubtful. We are deciding
the instant case under section 5 of Article XIII of the Constitution which is
more comprehensive and more absolute in the sense that it prohibits the
transfer to alien of any private agricultural land including residential land
whatever its origin might have been.
And, finally, on June 14, 1947, the Congress approved Republic Act No. 133
which allows mortgage of "private real property" of any kind in favor of
aliens but with a qualification consisting of expressly prohibiting aliens to bid
or take part in any sale of such real property as a consequence of the
mortgage. This prohibition makes no distinction between private lands that
are strictly agricultural and private lands that are residental or commercial.
The prohibition embraces the sale of private lands of any kind in favor of
aliens, which is again a clear implementation and a legislative interpretation
of the constitutional prohibition. Had the Congress been of opinion that
private residential lands may be sold to aliens under the Constitution, no
legislative measure would have been found necessary to authorize mortgage
which would have been deemed also permissible under the Constitution. But
clearly it was the opinion of the Congress that such sale is forbidden by the
Constitution and it was such opinion that prompted the legislative measure
intended to clarify that mortgage is not within the constitutional prohibition.
It is well to note at this juncture that in the present case we have no choice.
We are construing the Constitution as it is and not as we may desire it to be.
Perhaps the effect of our construction is to preclude aliens, admitted freely
into the Philippines from owning sites where they may build their homes. But
if this is the solemn mandate of the Constitution, we will not attempt to
compromise it even in the name of amity or equity. We are satisfied,
however, that aliens are not completely excluded by the Constitution from
the use of lands for residential purposes. Since their residence in the
Philippines is temporary, they may be granted temporary rights such as a
lease contract which is not forbidden by the Constitution. Should they desire
to remain here forever and share our fortunes and misfortunes, Filipino
citizenship is not impossible to acquire.
For all the foregoing, we hold that under the Constitution aliens may not
acquire private or public agricultural lands, including residential lands, and,
accordingly, judgment is affirmed, without costs.
Feria, Pablo, Perfecto, Hilado, and Briones, JJ., concur.
G.R. No. 113539 March 12, 1998
CELSO R. HALILI and ARTHUR R. HALILI, petitioners,
vs.
COURT OF APPEALS, HELEN MEYERS GUZMAN, DAVID REY GUZMAN and
EMILIANO CATANIAG, respondents.
PANGANIBAN, J.:
The factual findings of a trial court, when affirmed by the Court of Appeals,
may no longer be reviewed and reversed by this Court in a petition for review
under Rule 45 of the Rules of Court. The transfer of an interest in a piece of
land to an alien may no longer be assailed on constitutional grounds after the
entire parcel has been sold to a qualified citizen.
The Case
These familiar and long-settled doctrines are applied by this Court in denying
this petition under Rule 45 to set aside the Decision 1 of the Court of
Appeals 2 in CA-GR CV No. 37829 promulgated on September 14, 1993, the
dispositive portion of which states:3
WHEREFORE, and upon all the foregoing, the Decision of the court below
dated March 10, 1992 dismissing the complaint for lack of merit is AFFIRMED
without pronouncement as to costs.
The Facts
The factual antecedents, as narrated by Respondent Court, are not disputed
by the parties. We reproduce them in part, as follows:
Simeon de Guzman, an American citizen, died sometime in 1968, leaving real
properties in the Philippines. His forced heirs were his widow, defendant
appellee [herein private respondent] Helen Meyers Guzman, and his son,
defendant appellee [also herein private respondent] David Rey Guzman, both
of whom are also American citizens. On August 9, 1989, Helen executed a
deed of quitclaim (Annex A-Complaint), assigning [,] transferring and
conveying to David Rey all her rights, titles and interests in and over six
parcels of land which the two of them inherited from Simeon.
Among the said parcels of land is that now in litigation, . . . situated in
Bagbaguin, Sta. Maria, Bulacan, containing an area of 6,695 square meters,
covered by Transfer Certificate of Title No. T-170514 of the Registry of Deeds
of Bulacan. The quitclaim having been registered, TCT No. T-170514 was
cancelled and TCT No. T-120259 was issued in the name of appellee David
Rey Guzman.
On February 5, 1991, David Rey Guzman sold said parcel of land to
defendant-appellee [also herein private respondent] Emiliano Cataniag, upon
which TCT No. T-120259 was cancelled and TCT No. T-130721(M) was issued
in the latter's name.4
Petitioners, who are owners of the adjoining lot, filed a complaint before the
Regional Trial Court of Malolos, Bulacan, questioning the constitutionality
and validity of the two conveyances — between Helen Guzman and David
Rey Guzman, and between the latter and Emiliano Cataniag — and claiming
ownership thereto based on their right of legal redemption under Art.
1621 5 of the Civil Code.
In its decision6 dated March 10, 1992,7 the trial court dismissed the
complaint. It ruled that Helen Guzman's waiver of her inheritance in favor of
her son was not contrary to the constitutional prohibition against the sale of
land to an alien, since the purpose of the waiver was simply authorize David
Rey Guzman to dispose of their properties in accordance with the
Constitution and the laws of the Philippines, and not to subvert them. On the
second issue, it held that the subject land was urban; hence, petitioners had
no reason to invoke their right of redemption under Art. 1621 of the Civil
Code.
The Halilis sought a reversal from the Court of Appeals which, however,
denied their appeal. Respondent Court affirmed the factual finding of the
trial court that the subject land was urban. Citing Tejido
vs. Zamacoma,8 and Yap vs. Grageda,9 it further held that, although the
transfer of the land to David Rey may have been invalid for being contrary to
the Constitution, there was no more point in allowing herein petitioners to
recover the property, since it has passed on to and was thus already owned
by a qualified person.
Hence, this petition. 10
Issues
The petition submits the following assignment of errors:
. . . the Honorable Court of Appeals —
1. Erred in affirming the conclusion of the trial court that the land in question
is urban, not rural
2. Erred in denying petitioners' right of redemption under Art. 1621 of the
Civil Code
3. Having considered the conveyance from Helen Meyers Guzman to her son
David Rey Guzman illegal, erred in not declaring the same null and void[.] 11
The Court's Ruling
The petition has no merit.
First Issue: The Land Is Urban;
Thus, No Right of Redemption
The first two errors assigned by petitioners being interrelated — the
determination of the first being a prerequisite to the resolution of the second
— shall be discussed together
Subject Land Is Urban
Whether the land in dispute is rural or urban is a factual question which, as a
rule, is not reviewable by this Court. 12 Basic and long-settled is the doctrine
that findings of fact of a trial judge, when affirmed by the Court of Appeals,
are binding upon the Supreme Court. This admits of only a few exceptions,
such as when the findings are grounded entirely on speculation, surmises or
conjectures; when an inference made by the appellate court from its factual
findings is manifestly mistaken, absurd or impossible; when there is grave
abuse of discretion in the appreciation of facts; when the findings of the
appellate court go beyond the issues of the case, run contrary to the
admissions of the parties to the case or fail to notice certain relevant facts
which, if properly considered, will justify a different conclusion; when there is
a misappreciation of facts; when the findings of fact are conclusions without
mention of the specific evidence on which they are based, are premised on
the absence of evidence or are contradicted by evidence on record. 13
The instant case does not fall within any of the aforecited exceptions. In fact,
the conclusion of the trial court — that the subject property is urban land —
is based on clear and convincing evidence, as shown in its decision which
disposed thus:
. . . As observed by the court, almost all the roadsides along the national
ghighway [sic] of Bagbaguin, Sta. Maria, Bulacan, are lined up with
residential, commercial or industrial establishments. Lined up along the
Bagbaguin Road are factories of feeds, woodcrafts [sic] and garments,
commercial stores for tires, upholstery materials, feeds supply and spare
parts. Located therein likewise were the Pepsi-Cola Warehouse, the Cruz
Hospital, three gasoline stations, apartment buildings for commercial
purposes and construction firms. There is no doubt, therefore, that the
community is a commercial area thriving in business activities. Only a short
portion of said road [is] vacant. It is to be noted that in the Tax Declaration in
the name of Helen Meyers Guzman[,] the subject land is termed
agricultural[,] while in the letter addressed to defendant Emiliano Cataniag,
dated October 3, 1991, the Land Regulatory Board attested that the subject
property is commercial and the trend of development along the road is
commercial. The Board's classification is based on the present condition of
the property and the community thereat. Said classification is far more later
[sic] than the tax declaration.14
No Ground to Invoke
Right of Redemption
In view of the finding that the subject land is urban in character, petitioners
have indeed no right to invoke Art. 1621 of the Civil Code, which
presupposes that the land sought to be redeemed is rural. The provision is
clearly worded and admits of no ambiguity in construction:
Art. 1621. The owners of adjoining lands shall also have the right of
redemption when a piece of rural land, the area of which does not exceed
one hectare, is alienated, unless the grantee does not own any rural land.
x x x           x x x          x x x
Under this article, both lands — that sought to be redeemed and the
adjacent lot belonging to the person exercising the right of redemption —
must be rural. If one or both are urban, the right cannot be invoked.15 The
purpose of this provision, which is limited in scope to rural lands not
exceeding one hectare, is to favor agricultural development.16 The subject
land not being rural and, therefore, not agricultural, this purpose would not
be served if petitioners are granted the right of redemption under Art. 1621.
Plainly, under the circumstances, they cannot invoke it.
Second Issue: Sale to Cataniag Valid
Neither do we find any reversible error in the appellate court's holding that
the sale of the subject land to Private Respondent Cataniag renders moot any
question on the constitutionally of the prior transfer made by Helen Guzman
to her son David Rey.
True, Helen Guzman's deed of quitclaim — in which she assigned, transferred
and conveyed to David Rey all her rights, titles and interests over the
property she had inherited from her husband — collided with the
Constitution, Article XII, Section 7 of which provides:
Sec. 7. Save in cases of hereditary succession, no private lands shall be
transferred or conveyed except to individuals, corporations, or associations
qualified to acquire or hold lands of the public domain.
The landmark case of Krivenko vs. Register of Deeds  17 settled the issue as to
who are qualified (and disqualified) to own public as well as private lands in
the Philippines. Following a long discourse maintaining that the "public
agricultural lands" mentioned in Section 1, Article XIII of the 1935
Constitution, include residential, commercial and industrial lands, the Court
then stated:
Under section 1 of Article XIII [now Sec. 2, Art. XII] of the Constitution,
"natural resources, with the exception of public agricultural land, shall not be
alienated," and with respect to public agricultural lands, their alienation is
limited to Filipino citizens. But this constitutional purpose conserving
agricultural resources in the hands of Filipino citizens may easily be defeated
by the Filipino citizens themselves who may alienate their agricultural lands
in favor of aliens. It is partly to prevent this result that section 5 is included in
Article XIII, and it reads as follows:
Sec. 5. Save in cases of hereditary succession, no private agricultural land will
be transferred or assigned except to individuals, corporations or associations
qualified to acquire or hold lands of the public domain in the Philippines.
This constitutional provision closes the only remaining avenue through which
agricultural resources may leak into aliens' hands. It would certainly be futile
to prohibit the alienation of public agricultural lands to aliens if, after all, they
may be freely so alienated upon their becoming private agricultural lands in
the hands of Filipino citizens. Undoubtedly, as above indicated, section 5
[now Sec. 7] is intended to insure the policy of nationalization contained in
section 1 [now Sec. 2]. Both sections must, therefore, be read together for
they have the same purpose and the same subject matter. It must be noticed
that the persons against whom the prohibition is directed in section 5 [now
Sec. 7] are the very same persons who under section 1 [now Sec. 2] are
disqualified "to acquire or hold lands of the public domain in the Philippines."
And the subject matter of both sections is the same, namely, the non
transferability of "agricultural land" to aliens . . . .18
The Krivenko rule was recently reiterated in Ong Ching Po vs. Court of
Appeals,  19 which involves a sale of land to a Chinese citizen. The Court sad:
The capacity to acquire private land is made dependent upon the capacity to
acquire or hold lands of the public domain. Private land may be transferred
or conveyed only to individuals or entities "qualified to acquire lands of the
public domain" (II Bernas, The Constitution of the Philippines 439-440 [1988
ed.]).
The 1935 Constitution reserved the right to participate in the "disposition,
exploitation, development and utilization" of all "lands of the public domain
and other natural resources of the Philippines" for Filipino citizens or
corporations at least sixty percent of the capital of which was owned by
Filipinos. Aliens, whether individuals or corporations, have been disqualified
from acquiring public lands; hence, they have also been disqualified from
acquiring private lands. 20
In fine, non-Filipinos cannot acquire or hold title to private lands or to lands
of the public domain, except only by way of legal succession. 21
But what is the effect of a subsequent sale by the disqualified alien vendee to
a qualified Filipino citizen? This is not a novel question. Jurisprudence is
consistent that "if land is invalidly transferred to an alien who subsequently
becomes a citizen or transfers it to a citizen, the flaw in the original
transaction is considered cured and the title of the transferee is rendered
valid." 22
Thus, in United Church Board of Word Ministries vs. Sebastian, 23 in which an
alien resident who owned properties in the Philippines devised to an
American non-stock corporation part of his shares of stock in a Filipino
corporation that owned a tract of land in Davao del Norte, the Court
sustained the invalidity of such legacy. However, upon proof that ownership
of the American corporation has passed on to a 100 percent Filipino
corporation, the Court ruled that the defect in the will was "rectified by the
subsequent transfer of the property."
The present case is similar to De Castro vs. Tan. 24 In that case, a residential
lot was sold to a Chinese. Upon his death, his widow and children executed
an extrajudicial settlement, whereby said lot was allotted to one of his sons
who became a naturalized Filipino. The Court did not allow the original
vendor to have the sale annulled and to recover the property, for the reason
that the land has since become the property of a naturalized Filipino citizen
who is constitutionally qualified to own land.
Likewise, in the cases of Sarsosa vs. Cuenco, 25 Godinez vs. Pak
Luen, 26 Vasquez vs. Li Seng Giap 27 and Herrera vs. Luy Kim Guan, 28 which
similarly involved the sale of land to an alien who thereafter sold the same to
a Filipino citizen, the Court again applied the rule that the subsequent sale
can no longer be impugned on the basis of the invalidity of the initial
transfer.
The rationale of this principle was explained in Vasquez vs. Li Seng Giap thus:
. . . [I]f the ban on aliens from acquiring not only agricultural but also urban
lands, as construed by this Court in the Krivenko case, is to preserve the
nation's lands for future generations of Filipinos, that aim or purpose would
not be thwarted but achieved by making lawful the acquisition of real estate
by aliens who became Filipino citizens by naturalization.29
Accordingly, since the disputed land is now owned by Private Respondent
Cataniag, a Filipino citizen, the prior invalid transfer can no longer be
assailed. The objective of the constitutional provision — to keep our land in
Filipino hands — has been served.
WHEREFORE, the petition is hereby DENIED. The challenged Decision is
AFFIRMED. Costs against petitioner.

SO ORDERED.
G.R. No. 142913. August 9, 2005
ESTATE OF SALVADOR SERRA SERRA (SPEC. PROC. NO. 242) AND ESTATE OF
GREGORIO SERRA SERRA (SPEC. PROC. NO. 240), BOTH REPRESENTED BY
THE JUDICIAL CO-ADMINISTRATOR LUIS ISASI, MARGARITA SERRA SERRA,
FRANCISCA TERESA SERRA SERRA and FRANCISCO JOSE SERRA
SERRA, Petitioners,
vs.
HEIRS OF PRIMITIVO HERNAEZ, REPRESENTED BY PRESENTACION HERNAEZ
BELBAR, HEIRS OF LUISA HERNAEZ, REPRESENTED BY WILFREDO GAYARES,
LOLITA GAYARES, JULIETA FORTALEZA AND ROSAURO FORTALEZA, HEIRS
OF ROGACIANA HERNAEZ, REPRESENTED BY LOURDES
MONCERA, Respondent.
DECISION
YNARES-SANTIAGO, J.:
This petition for review on certiorari under Rule 45 of the 1997 Revised Rules
of Civil Procedure assails the March 3, 2000 decision of the Court of Appeals
in CA-G.R. SP No. 52817, and its April 17, 2000 resolution denying
reconsideration thereof.
The factual antecedents are as follows:
On December 27, 1967, a petition for reconstitution of alleged lost original
certificates of title (OCT) and owner’s duplicate copies in the name of
Eleuterio Hernaez covering Lot No. 1316 of Kabankalan Cadastre and Lot Nos.
2685 and 717 of Ilog Cadastre, in the Province of Negros Occidental, was filed
by his successors-in-interest Primitivo, Rogaciana and Luisa, all surnamed
Hernaez (Hernaez) with then Court of First Instance (CFI) of Bacolod City.
On April 6, 1968, the CFI granted the petition and ordered the reconstitution
of the subject OCTs and its duplicate copies.1 Accordingly, the Register of
Deeds of Negros Occidental issued reconstituted OCT Nos. RO-10173, RO-
10174, and RO-10175, for Lot Nos. 1316, 2685, and 717, respectively. These
reconstituted OCTs were cancelled on May 29, 1969 upon presentation by
Hernaez of a "declaration of heirship" and in lieu thereof, Transfer Certificate
of Title (TCT) Nos. T-51546, T-51547, and T-51548 were issued in their
names.
Upon learning of the existence of the above TCTs, Salvador Serra Serra, for
and in behalf of his co-heirs, registered their adverse claim and moved for
the cancellation of the reconstituted titles. They averred that they are
holders of valid and existing certificates of title over the subject properties
and have been in continuous and actual possession thereof.
The trial court denied petitioners’ motion to cancel the reconstituted titles
and granted instead Hernaez’ prayer that they be placed in possession of the
subject properties, which petitioners challenged before the Court of Appeals
in a petition for certiorari docketed as CA-G.R. No. SP-00139.2
On June 7, 1971, the appellate court issued a writ of preliminary
injunction3 which was ordered lifted in a resolution dated August 3, 1971.
Petitioners’ motion for reconsideration was denied, hence they filed before
this Court a petition for certiorari, prohibition and mandamus, docketed as
G.R. No. L-34080 and consolidated with G.R. No. L-34693,4 seeking to annul
the resolution lifting the writ of preliminary injunction.
On March 22, 1991, this Court rendered judgment the decretal portion of
which reads:
ACCORDINGLY, the petitions are GRANTED. The questioned order of the
respondent Court of Appeals lifting the writ of preliminary injunction is SET
ASIDE. The writ of possession issued in Cadastral Case No. 17, GLRO Records
No. 163 is declared NULL and VOID. The records of this case and of CA-G.R.
No. 00139 are remanded to the trial court for hearing of the motion for
cancellation of the reconstituted titles. Private respondents are ordered to
return to petitioners the possession of the properties in question. The
temporary restraining order issued by this Court on February 15, 1972,
enjoining private respondents from interfering in any manner, with
petitioners’ right of possession of the properties in question, shall remain
effective until the issue of ownership and/or possession of the properties is
finally settled by a competent court.
SO ORDERED.5
Pursuant thereto, the trial court heard petitioners’ motion for cancellation of
certificates of title and on November 25, 1998, rendered judgment the
dispositive portion of which reads:
WHEREFORE, based on the foregoing premises and considerations, the court
hereby renders judgment in favor of the oppositors and hereby orders the
following:
1) The petition filed by movants Serra Serra dated November 4, 1968 is
hereby DISMISSED for lack of merit;
2) Declaring the Transfer Certificate of Title No. T-27644 covering Lot No.
1316, Kabankalan Cadastre and Lot No. 2685, Ilog Cadastre, Transfer
Certificate of Title No. T-22344 covering Lot No. 717-A, and Transfer
Certificate of Title No. T-22351, Ilog Cadastre, all issued in the name of
movants Serra Serra NULL and VOID for being issued to foreigners;
3) Declaring the oppositors Hernaez as owners of Lot No. 1316, Kabankalan
Cadastre, covered by Transfer Certificate of Title No. 51546; Lot No. 2685,
Ilog Cadastre, covered by Transfer Certificate of Title No. T-51547; and Lot
No. 717, Ilog Cadastre, covered by Transfer Certiticate of Title No. T-51548;
and
4) Ordering the movants Serra Serra to return possession of said lots to the
oppositors Hernaez.
SO ORDERED.6
Without filing a motion for reconsideration, petitioners assailed the lower
court’s decision before the Court of Appeals via a petition for certiorari. On
March 3, 2000, the appellate court rendered the herein assailed judgment
which dismissed the petition for lack of merit, pertinent portion of which
reads:
In the case at bench, We find no cogent reason to disturb the assailed
decision denying petitioners’ motion for cancellation of the reconstituted
titles, especially after the court a quo found that the evidence presented is
sufficient and proper to uphold the reconstituted certificates of title in
question. A perusal of the assailed order shows that the trial court correctly
applied the established legal principle that in cases of annulment and/or
reconveyance of title, a party seeking it should establish not merely by a
preponderance of evidence but by clear and convincing evidence that the
land sought to be reconveyed is his.
Petitioners (Serra Serra), however, as noted by the court a quo in its Order
dated November 25, 1998, failed to present in court as evidence the original
certificates of title of the aforementioned lots, Lot No. 1316, Lot No. 2685
and Lot No. 717. Petitioners were also found to be of Spanish citizenship and,
hence, as aliens, disqualified to acquire lands in the Philippines under
the 1935 Constitution.7
Petitioners’ motion for reconsideration was subsequently denied, hence the
instant petition based on the following assigned errors:
I
THE COURT OF APPEALS HAS ... DEPARTED FROM THE ACCEPTED AND USUAL
COURSE OF JUDICIAL PROCEEDINGS AS TO CALL FOR THE EXERCISE OF THE
POWER OF SUPERVISION BY THIS HONORABLE COURT, IN THAT:
THE RULE THAT THE PETITIONER SHOULD HAVE PREVIOUSLY FILED A
MOTION FOR RECONSIDERATION WITH THE LOWER COURT BEFORE HE MAY
AVAIL HIMSELF OF THE WRIT OF CERTIORARI UNDER RULE 65 OF THE RULES
OF COURT IS SUBJECT TO WELL-SETTLED EXCEPTIONS ...
...
II
THE COURT OF APPEALS ... HAS DECIDED A QUESTION OF SUBSTANCE IN A
WAY PROBABLY NOT IN ACCORD WITH LAW, REPUBLIC ACT NO. 26, OR WITH
THE APPLICABLE DECISION OF THIS HONORABLE COURT IN SERRA VS. COURT
OF APPEALS, G.R. NO. L-34080, MARCH 22, 1991.8
Petitioners assail the dismissal of their petition on the ground that they failed
to file a motion for reconsideration with the lower court before filing a
petition for certiorari before the Court of Appeals. While admitting
procedural lapse on their part, they argue that the rule is subject to well-
settled exceptions, such as, when the questions raised before the Supreme
Court are the same as those which have been squarely raised and passed
upon by the trial court, or when the petitioner has been deprived of due
process of law, or when the writ is urgent under the circumstances.9
examine and determine the weight of the evidence supporting the assailed
decision. Moreover, well entrenched is the prevailing jurisprudence that only
errors of law and not of facts are reviewable by this Court in a petition for
review on certiorari under Rule 45 of the Revised Rules of Court, which
applies with greater force to the petition under consideration because the
factual findings of the Court of Appeals are in full agreement with what the
trial court found.11
WHEREFORE, the petition is DENIED. The March 3, 2000 decision and the
April 17, 2000 resolution of the Court of Appeals in CA-G.R. SP No. 52817 are
AFFIRMED.
SO ORDERED.

The petition is denied. Other than citing general exceptions to the rule
requiring a motion for reconsideration as a pre-condition to instituting a
petition for certiorari, the petitioners did not offer valid reason why their
particular case fall under any of the specified exceptions.

The settled rule is that a motion for reconsideration is a sine qua

non condition for the filing of a petition for certiorari. The purpose is to grant
an opportunity to public respondent to correct any actual or perceived error
attributed to it by the re-examination of the legal and factual circumstances
of the case.10 Petitioners’ failure to file a motion for reconsideration deprived
the trial court of the opportunity to rectify an error unwittingly committed or
to vindicate itself of an act unfairly imputed. Besides, a motion for
reconsideration under the present circumstances is the plain, speedy and
adequate remedy to the adverse judgment of the trial court.

Granting arguendo that certiorari is the proper remedy, the Court of Appeals

nevertheless did not err in dismissing the petition.

Both the trial court and the Court of Appeals found that petitioners are
Spanish citizens and as such, disqualified from acquiring lands in the
Philippines. As a rule, only a Filipino citizen can acquire private lands in the
Philippines and the only instances when a foreigner can own private lands
are by hereditary succession and if he was formerly a natural-born Filipino
citizen who lost his Philippine citizenship. The records are bereft of any
showing that petitioners derived their title by any mode which would qualify
them to acquire private lands in the country. Petitioners’ bare allegation that
they acquired the subject lots from Salvador Serra Serra has no probative
value lacking sufficient proof that the latter is not disqualified to own or hold
private property and was able to legally transmit to petitioners title thereto.

Petitioners’ alleged possession of TCTs and actual possession of the subject

lands, although strong proof of ownership, are not necessarily conclusive
where the assertion of proprietary rights is founded on dubious claim of
ownership. They claimed that their title over the subject properties
emanated from Salvador Serra Serra; yet they failed to present in evidence
the OCT in the name of the latter. Since petitioners impugn the proprietary
claim of Hernaez over the properties, the burden rests on them to establish
their superior right over the latter. To recall, the trial court found that the
evidence they presented have not established superior proprietary rights
over the respondents’ on the subject lots. It held that the non-presentation
of the OCTs cast doubt on the veracity of their claim. He who asserts must
prove.

It is also undisputed that petitioners are all Spanish citizens. Under Philippine
law, foreigners can acquire private lands only by hereditary succession or
when they were formerly natural-born Filipinos who lost their Philippine
citizenship. In this case, petitioners did not present proof that they acquired
the properties by inheritance. Neither did they claim to be former natural-
born Filipinos. On the contrary, they declare in this petition that they are all
Spanish citizens residing in Mallorca, Spain.

It is axiomatic that factual findings of trial courts, when adopted and

confirmed by the Court of Appeals, are binding and conclusive and will not be
disturbed on appeal. This Court is not a trier of facts. It is not its function to
G.R. No. 132964           February 18, 2000
REPUBLIC OF THE PHILIPPINES, petitioner,
vs.
DAVID REY GUZMAN, represented by his Attorney-in-Fact, LOLITA G.
ABELA, and the REGISTER OF DEEDS OF BULACAN, MEYCAUAYAN
BRANCH, respondents.
BELLOSILLO, J.:
The REPUBLIC OF THE PHILIPPINES seeks the nullification of the 5 March
1998 Decision of the Court of Appeals1 which affirmed the dismissal by the
Regional Trial Court, Br. 77, Malolos, Bulacan, of the petition for escheat filed
by the Government.2
David Rey Guzman, a natural-born American citizen, is the son of the spouses
Simeon Guzman,3 a naturalized American citizen, and Helen Meyers Guzman,
an American citizen. In 1968 Simeon died leaving to his sole heirs Helen and
David an estate consisting of several parcels of land located in Bagbaguin,
Sta. Maria, Bulacan, covered by TCT Nos. T-146837 (M), T-146839 (M), T-
146840 (M), T-146841 (M), T-146842 (M), T-120254 (M) and T-120257 (M).
On 29 December 1970 Helen and David executed a Deed of Extrajudicial
Settlement of the Estate of Simeon Guzman dividing and adjudicating to
themselves all the property belonging to the estate of Simeon. The
document of extrajudicial settlement was registered in the Office of the
Register of Deeds on 8 December 1971. The taxes due thereon were paid
through their attorneys-in-fact, Attys. Juan L. Austria and Lolita G. Abela, and
the parcels of land were accordingly registered in the name of Helen Meyers
Guzman and David Rey Guzman in undivided equal shares.
On 10 December 1981 Helen executed a Quitclaim Deed assigning,
transferring and conveying to her son David her undivided one-half (1/2)
interest on all the parcels of land subject matter of the Deed of Extrajudicial
Settlement of the Estate of Simeon Guzman. Since the document appeared
not to have been registered, upon advice of Atty. Lolita G. Abela, Helen
executed another document, a Deed of Quitclaim, on 9 August 1989
confirming the earlier deed of quitclaim as well as modifying the document
to encompass all her other property in the Philippines.4
On 18 October 1989 David executed a Special Power of Attorney where he
acknowledged that he became the owner of the parcels of land subject of
the Deed of Quitclaim executed by Helen on 9 August 1989 and empowering
Atty. Lolita G. Abela to sell or otherwise dispose of the lots. On 1 February
1990 Atty. Lolita G. Abela, upon instruction of Helen, paid donor's taxes to
facilitate the registry of the parcels of land in the name of David.
On 16 March 1994 a certain Atty. Mario A. Batongbacal wrote the Office of
the Solicitor General and furnished it with documents showing that David's
ownership of the one-half (1/2) of the estate of Simeon Guzman was
defective. On the basis thereof, the Government filed before the Regional
Trial Court of Malolos Bulacan a Petition for Escheat praying that one-half
(1/2) of David's interest in each of the subject parcels of land be forfeited in
its favor. On 9 August 1994 David Rey Guzman responded with a prayer that
the petition be dismissed.
On 11 July 1995 the trial court dismissed the petition holding that the two (2)
deeds of quitclaim executed by Helen Meyers Guzman had no legal force and
effect so that the ownership of the property subject thereof remained with
her.5
The Government appealed6 the dismissal of the petition but the appellate
court affirmed the court a quo.
Petitioner anchors its argument on Art. XII of the Constitution which provides
—
Sec. 7. Save in cases of hereditary succession, no private lands shall be
transferred or conveyed except to individuals, corporations, or associations
qualified to acquire or hold lands of the public domain.
Sec. 8. Notwithstanding the provisions of Section 7 of this Article, a natural-
born citizen of the Philippines who has lost his Philippine citizenship may be a
transferee of private lands, subject to limitations provided by law.
Thus as a rule, only a Filipino citizen can acquire private lands in the
Philippines. The only instances when a foreigner can acquire private lands in
the Philippines are by hereditary succession and if he was formerly a natural-
born Filipino citizen who lost his Philippine citizenship. Petitioner therefore
contends that the acquisition of the parcels of land by David does not fall
under any of these exceptions. It asserts that David being an American citizen
could not validly acquire one-half (1/2) interest in each of the subject parcels
of land by way of the two (2) deeds of quitclaim as they are in reality
donations inter vivos. It also reasons out that the elements of donation are
present in the conveyance made by Helen in favor of David: first, Helen
consented to the execution of the documents; second, the dispositions were
made in public documents; third, David manifested his acceptance of the
donation in the Special Power of Attorney he executed in favor of Atty. Lolita
G. Abela; fourth, the deeds were executed with the intention of benefiting
David; and lastly, there was a resultant decrease in the assets or patrimony
of Helen, being the donor. Petitioner further argues that the payment of
donor's taxes on the property proved that Helen intended the transfer to be
a gift or donation inter vivos.
David maintains, on the other hand, that he acquired the property by right of
accretion and not by way of donation, with the deeds of quitclaim merely
declaring Helen's intention to renounce her share in the property and not an
intention to donate. He further argues that, assuming there was indeed a
donation, it never took effect since the Special Power of Attorney he
executed does not indicate acceptance of the alleged donation.
There are three (3) essential elements of a donation: (a) the reduction of the
patrimony of the donor; (b) the increase in the patrimony of the donee; and,
(c) the intent to do an act of liberality or animus donandi. When applied to a
donation of an immovable property, the law further requires that the
donation be made in a public document and that there should be an
acceptance thereof made in the same deed of donation or in a separate
public document.7 In cases where the acceptance is made in a separate
instrument, it is mandated that the donor should be notified thereof in an
authentic form, to be noted in both instruments.8
Not all the elements of a donation of an immovable property are present in
the instant case. The transfer of the property by virtue of the Deed of
Quitclaim executed by Helen resulted in the reduction of her patrimony as
donor and the consequent increase in the patrimony of David as donee.
However, Helen's intention to perform an act of liberality in favor of David
was not sufficiently established. A perusal of the two (2) deeds of quitclaim
reveals that Helen intended to convey to her son David certain parcels of
land located in the Philippines, and to re-affirm the quitclaim she executed in
1981 which likewise declared a waiver and renunciation of her rights over
the parcels of land. The language of the deed of quitclaim is clear that Helen
merely contemplated a waiver of her rights, title and interest over the lands
in favor of David, and not a donation. That a donation was far from Helen's
mind is further supported by her deposition which indicated that she was
aware that a donation of the parcels of land was not possible since Philippine
law does not allow such an arrangement.9 She reasoned that if she really
intended to donate something to David it would have been more convenient
if she sold the property and gave him the proceeds therefrom.10 It appears
that foremost in Helen's mind was the preservation of the Bulacan realty
within the bloodline of Simeon from where they originated, over and above
the benefit that would accrue to David by reason of her renunciation.11 The
element of animus donandi therefore was missing.
Likewise, the two (2) deeds of quitclaim executed by Helen may have been in
the nature of a public document but they lack the essential element of
acceptance in the proper form required by law to make the donation valid.
We find no merit in petitioner's argument that the Special Power of Attorney
executed by David in favor of Atty. Lolita G. Abela manifests his implied
acceptance of his mother's alleged donation as a scrutiny of the document
clearly evinces the absence thereof. The Special Power of Attorney merely
acknowledges that David owns the property referred to and that he
authorizes Atty. Abela to sell the same in his name. There is no intimation,
expressly or impliedly, that David's acquisition of the parcels of land is by
virtue of Helen's possible donation to him and we cannot look beyond the
language of the document to make a contrary construction as this would be
inconsistent with the parol evidence rule.12
WHEREFORE, the assailed Decision of the Court of Appeals which sustained
the Decision of the Regional Trial Court of Malolos, Bulacan, dismissing the
petition for escheat is AFFIRMED. No costs.
SO ORDERED.

Moreover, it is mandated that if an acceptance is made in a separate public

writing the notice of the acceptance must be noted not only in the document
containing the acceptance but also in the deed of donation. Commenting on
Art. 633 of the Civil Code from whence Art. 74913 came Manresa said: "If the
acceptance does not appear in the same document, it must be made in
another. Solemn words are not necessary; it is sufficient if it shows the
intention to accept . . . . it is necessary that formal notice thereof be given to
the donor, and the fact that due notice has been given must be noted in both
instruments. Then and only then is the donation perfected.14

Thus, in Santos v. Robledo we emphasized that when the deed of donation is

recorded in the registry of property the document that evidences the
acceptance — if this has not been made in the deed of gift — should also be
recorded. And in one or both documents, as the case may be, the notification
of the acceptance as formally made to the donor or donors should be duly
set forth.15 Where the deed of donation fails to show the acceptance, or
where the formal notice of the acceptance made in a separate instrument is
either not given to the donor or else noted in the deed of donation, and in
the separate acceptance, the donation is null and void.16

These requisites, definitely prescribed by law, have not been complied with,
and no proof of compliance appears in the record. The two (2) quitclaim
deeds set out the conveyance of the parcels of land by Helen in favor of
David but its acceptance by David does not appear in the deeds, nor in the
Special Power of Attorney. Further, the records reveal no other instrument
that evidences such acceptance and notice thereof to the donor in an
authentic manner. It is well-settled that if the notification and notation are
not complied with, the donation is void. Therefore, the provisions of the law
not having been complied with, there was no effective conveyance of the
parcels of land by way of donation inter vivos.17

However, the inexistence of a donation does not render the repudiation

made by Helen in favor of David valid. There is no valid repudiation of
inheritance as Helen had already accepted her share of the inheritance when
she, together with David, executed a Deed of Extrajudicial Settlement of the
Estate of Simeon Guzman on 29 December 1970 dividing and adjudicating
between the two (2) of them all the property in Simeon's estate. By virtue of
such extrajudicial settlement the parcels of land were registered in her and
her son's name in undivided equal share and for eleven (11) years they
possessed the lands in the concept of owner. Article 1056 of the Civil Code
provides —

The acceptance or repudiation of an inheritance, once made is irrevocable

and cannot be impugned, except when it was made through any of the
causes that vitiate consent or when an unknown will appears.

Nothing on record shows that Helen's acceptance of her inheritance from

Simeon was made through any of the causes which vitiated her consent nor
is there any proof of the existence of an unknown will executed by Simeon.
Thus, pursuant to Art. 1056, Helen cannot belatedly execute an instrument
which has the effect of revoking or impugning her previous acceptance of her
one-half (1/2) share of the subject property from Simeon's estate. Hence, the
two (2) quitclaim deeds which she executed eleven (11) years after she had
accepted the inheritance have no legal force and effect.

Nevertheless, the nullity of the repudiation does not ipso facto operate to

convert the parcels of land into res nullius18 to be escheated in favor of the
Government. The repudiation being of no effect whatsoever the parcels of
land should revert to their private owner, Helen, who, although being an
American citizen, is qualified by hereditary succession to own the property
subject of the litigation.1âwphi1.nêt
G.R. No. 91189 November 27, 1992
THE DIRECTOR OF LANDS, petitioner,
vs.
SAMUEL BUYCO and EDGAR BUYCO, represented by their attorney-in-fact,
RIEVEN H. BUYCO and THE COURT OF APPEALS, respondents.
DAVIDE, JR., J.:
In its Decision of 5 February 1985, 1 Branch 82 of the Regional Trial Court
(RTC) at Odiongan, Romblon granted the application of the private
respondents, who are American citizens, to bring within the operation of the
Land Registration Act a parcel of land with an area of 3,194,788 square
meters (319.4788 hectares) which spreads across the barangays of
Canduyong, Anahao and Ferrol in the municipality of Odiongan, Province of
Romblon, and to confirm their title thereto.
Petitioner appealed the decision to the Court of Appeals; he alleged therein
that the trial court erred (a) in not declaring the private respondents barred
by the Constitution from applying for registration because they are American
citizens and are thus disqualified from acquiring lands in the Philippines, (b)
in holding that private respondents had established proprietary rights over
the land even before acquiring American citizenship through naturalization,
and (c) independently of the issue of alienage, in not dismissing the
application for registration on the basis of the private respondents failure to
overthrow, by conclusive or well-nigh incontrovertible proof, the
presumption that the land applied for is public land belonging to the State. 2
In its Decision of 21 November 1989 in CA-G.R. CV No. 05824, 3 public
respondent dismissed the appeal "for lack of merit."4
Petitioner consequently filed this petition on 11 January 1990 under Rule 45
of the Rules of Court. Reiterating the issues he raised before the respondent
Court, he seeks a review and reversal of the latter's decision. 5
In the Resolution of 11 July 1990, this Court gave due course to the petition
after the filing by the private respondents of their Comment to the same and
by the petitioner of his reply thereto.6 On 17 April 1991, the parties were
required to file their respective Memoranda. 7
The records disclose the following material operative facts and procedural
antecedents:
A certain Charles Hankins, an American who was married to Laura Crescini
and who resided in Canduyong, Odiongan, Romblon, died on 31 May 1937
leaving a will (Exhibit "N"). He was survived by his widow; his son Alexander
and William; and his grandchildren Ismael Samuel and Edgar, all surnamed
Buyco, who are the legitimate issues of his deceased daughter Lilia and her
husband Marcelino Buyco. The will was submitted for probate before the
then Court of First Instance (now Regional Trial Court) of Romblon. Charles
Hankins' son Alexander was appointed administrator of the estate in Special
Proceedings No. 796.
Laura Crescini died on 22 December 1941.
It appears that in a Project of Partition dated 25 June 1947 (Exhibit "O") and
submitted to the probate court in the aforesaid Special Proceedings No. 796,
one of the properties of Charles Hankins described as "a parcel of
pastureland, riceland and coconut land containing an area of about 250
hectares, 21 ares and 63 untares . . . assessed at for P6,950.00 as per Tax
Declaration No. 15853," was partitioned among his heirs as follows:
xxx xxx xxx
TO LAURA C. HANKINS, . . .
(a) 157 acres . . . comprised in what is known as Carabao Pastureland and
Milk-Cow Pasture. (This land is a portion of the land described in tax
declaration N0. 15853 . . .)
xxx xxx xxx
TO ALEXANDER HANKINS, . . .
(a) 80 acres of land (pasture) which is a portion of the land described in Tax
declaration No. 15853 . . . .
xxx xxx xxx
TO LILIA HANKINS, . . .
(a) 100 acres of pastureland situated in the barrio of Canduyong and which is
a portion of the entire parcel described in tax declaration No. 15853 . . . .
(b) 25 acres of pasture land situated in the barrio of Canduyong and which is
a portion of the entire parcel described in tax declaration No. 15853.
xxx xxx xxx
TO WILLIAM B. HANKINS, . . .
(a) 100 acres of pastureland situated in the barrio of Canduyong and which is
a portion of the entire parcel described in tax declaration No. 15853 . . . .
(b) 25 acres of pasture land situated in barrio Anajao and which is a portion
of the entire parcel described in tax declaration No. 15853 . . . . 8
The total area so adjudicated is 487 acres, or 197.086 hectares (1 hectare =
2.471 acres)
On 30 July 1948, Laura's share in the estate of her husband Charles was
partitioned among her children. Alexander and William, and her
grandchildren, Ismael, Samuel and Edgar who were represented by their
father Marcelino Buyco (Exhibit "P"). Thereafter, on the same date, William
sold his hereditary shares in the estate of his parents to Marcelino Buyco
(Exhibit "R").
On 20 August 1962, Marcelino Buyco donated to his children the property
acquired from William together with other properties (Exhibit "S").
On 8 September 1970, the Buyco brothers partitioned among themselves the
properties acquired by inheritance from their grandparents and by donation
from their father (Exhibit "T"). However, Ismael waived his right to his share
therein in favor of Samuel, one of the private respondents in this case.
Edgar and Samuel Buyco became naturalized American citizens on 29 January
1972 and 12 September 1975, respectively.
On 14 October 1967, Edgar and Samuel, through their attorney-in-fact,
Rieven H. Buyco, filed before the then Court of First Instance of Romblon an
application for the registration of a parcel of land, described as follows:
A parcel of land (Lot I, under surveyed for the heirs of Lilia Hankins situated
in the barrios of Canduyong, Anahao and Ferrol, Municipality of Odiongan,
province of Romblon, Tablas Island under PSU 127238) LRC Record No.
________: Bounded on the North by properties of the heirs of Rita Fiedacan
and Alexander Hankins; on the Northeast, by Canduyong River and property
of Alexander Hankins; on the East, by properties of Andres Cuasay,
Escolastica Feruelo, Candido Mendoza, Raymundo Goray, Pedro Goray,
Manuel Yap, Feliza Fedri and Silverio Mierculecio; on the Southeast, by
properties of Candido Mendoza, the Heirs of Benita Formilleza Silverio
Mierculecio, Zosimo Llorca, Lot 2, and properties of Beatrice Hankins and
Zosimo Llorca; on the West, by properties of Maria Llorca and Miguel Llorca;
and on the Northwest, by property of Catalino Fabio. Point "I" is S. 33 deg.
24"., 4075.50 m. from B.L.L.M. 1, Odiongan, Romblon. Area THREE MILLION
ONE HUNDRED NINETY FOUR THOUSAND SEVEN HUNDRED EIGHTY EIGHT
(3,194,788) SQUARE METERS, more or less as Exhibit "C". 9
which they claim to own in fee simple as they acquired the same by
inheritance and donation inter vivos. However, they allege in paragraph 9 of
the application that should the Land Registration Act be inapplicable, the
benefits provided for under C.A. No. 141, as amended, be made to extend to
them since both they and their predecessors-in-interest have been in
possession thereof since time immemorial. The application was docketed as
Land Registration Case No. N-48 LRC Record No. N-51706.
The above description is based on a survey plan prepared by private land
surveyor Santiago Español in 1950 (Exhibit "C") and subsequently approved
by the Director of Lands. While in their application, private respondents
invoked the provisions of the Land Registration Act,10 they eventually sought
for a confirmation of imperfect title pursuant to paragraph (b), Section 48 of
the Public Land Act 11, as further amended by P.D. No. 1073.
While only the herein petitioner filed an opposition thereto, the
Development Bank of the Philippines (DBP) manifested that the portion of
the property pertaining to Samuel Buyco is covered by a mortgage in its
favor. After the jurisdictional facts had been established during the initial
hearing and a general order of default entered against all other parties, the
lower court designated the Judge of the Municipal Trial Court of Odiongan as
commissioner to receive the evidence for the parties. Samuel Buyco, William
Hankins, Manuel Firmalo and Jacinta Gomez Gabay (who was 83 years old
when she took the witness stand in October 1979) testified for the
applicants. The first two (2) recounted the history of the tract of land up to
the time of the abovementioned partitions and the alleged possession of the
entire area by the applicants (private respondents herein).
On 5 February 1985, the land registration court handed down a
Decision 12 the dispositive portion of which reads:
PREMISES CONSIDERED, this Court hereby orders the registration of title to
the parcel of land designated as Lot No. 1 Psu-127238 and its technical
description together with all the improvements thereon, in the name of the
herein applicants, recognizing the interest of the Development Bank of the
Philippines to be annotated on the certificate of title to be issued as
mortgagee for the amount of P200,000.00 with respect to the share of
applicants (sic) Samuel H. Buyco.
Upon the decision become (sic) final let the corresponding decree and
certificate of title be issued accordingly.
The favorable decision is based on the court's conclusion that:
The oral and documentary evidence indubitably show applicants and their
predecessors-in-interest — their grandparents Charles Hankins and Laura
Crescini, to their uncle Alexander Hankins, to them thru their administrators
Gregorio Gabay and later Manuel Firmalo — have possessed the property
herein sought to be registered in the concept of owners thereof, and such
possession has been continuous, uninterrupted, adverse, open and public for
a period of more than eighty years. And their right over the property is duly
recognized by the adjoining owners in their individual affidavits marked as
Exhibits "V", "V-1" to "V-21", inclusive. Moreover, none of the adjoining
owners filed any opposition to the herein land registration case, thereby
indubitably showing their recognition of the correctness of the boundary (sic)
between their individual lots and that of applicants land subject of this
registration.
The late Charles Hankins declared said land for taxation purposes under Tax
Declaration No. 15853 (please see description of lot in Exh. "N") and
thereafter in the name of applicants and/or their father Marcelino Buyco
since 1949 up to the present time (Exhs. "W", "W-1" to "W-19").
Applicants have also paid the real estate taxes thereon since 1948 up to the
present time (Exhs. "X", "X-1" to "X-194").
In 1950, the land of applicants was surveyed by Private Surveyor Santiago
Español and its exact metes and bounds were determined with accuracy in
his survey plan PSU-127238 (Exh. "C"). This survey corrected the
impreciseness of the land area as mentioned in the several instruments ––
the will, project of partition, deed of partition, deed of sale (Exhs. "N", "O",
"P", and "R") — under which applicants acquired the land in question. The
correctness of this survey is further shown by the fact that none of the other
heirs, like Alexander Hankins nor (sic) the adjoining owners ever made a
claim over any portion of the lot shown in said Psu-127238.
The land in question has been primarily devoted to cattle grazing (sic) and to
the cultivation of rice and coconut and it was (sic) the applicants and their
predecessors-in-interest have (sic) been reaping the fruits thereof.
The evidence further show (sic) that applicants can rightfully and did validly
acquire title and ownership over the land in question because they were
then Filipino citizens, their father Marcelino Buyco being a Filipino citizen
himself (please see personal circumstances of Marcelino Buyco in Exhs. "P"
and "R") and their modes of acquisition — by inheritance, intestate
succession, and donation inter-vivos — are all legally recognized modes to
transfer ownership to them from their predecessors-in-interest.
Since time immemorial, applicants and their predecessors-in-interest have
exercised all the attributes of dominion and absolute ownership over the
land in question, and have therefore established their vested proprietary
rights and registrable (sic) title over the land in question, rights which they
have acquired long before they became citizens of the United States (Edgar
Buyco became a U.S. citizen only on January 29, 1972; while Samuel H.
Buyco, only on September 12, 1975. As a matter of fact, applicant Samuel H.
Buyco mortgaged in favor of the Development Bank of the Philippines (Exhs.
"U", "U-1" and "U-2") the portion belonging to him in Lot 1, Psu-127238.
From the foregoing evidence it has been satisfactorily established that the
applicants have acquired an imperfect and incomplete title over the parcel of
land subject of this registration proceedings in their own right as citizens of
the Philippines so as to entitle them to a confirmation and registration of said
lot in their names. Consequently Section II, Article XVII of the 1973
Constitution does not apply to this case, neither (sic) does this case fall under
the provisions of Presidential Decree No. 713. 13
More specifically, the conclusion regarding possession is based on the
testimonies of Manuel Firmalo, William Hankins and Jacinta Gomez Gabay
which, as summarized by the court, are as follows:
xxx xxx xxx
Witness Manuel Firmalo testified that from 1970 to 1978 he was the
administrator, of the property of applicants; that the said property is located
in the Barrios of Anahao, Canduyong, and Tubigon (now forming part of the
municipality of Ferrol) and the same is shown in the survey may marked as
Exh. "C" (Psu-127238); that said lot is separated from the adjacent properties
by concrete monuments, big tress and some barb (sic) wire fence (sic); that
previous to his administration thereof, the same property was administered
by his father-in-law, Gregorio Gabay; . . . that during his administration, a
large part of the land was devoted to cattle grazing and a little portion, to
coconut (sic) which are now fruit bearing; that when he took over the
administration of the ranch, there was a total of 120 heads of cattle and at
the time of termination of his administration there were 300 heads; that
from time to time, some cattle in the ranch were sold by him and he
rendered an accounting to the applicants, the owners of the ranch; that he
employed cowhands to help him ran (sic) the ranch of applicants and the
salaries of said cowhands were paid out of the funds of applicant Samuel
Buyco from the sale of the cattle; that the proceeds of the coconuts
harvested, the money was (sic) deposited with the bank and a portion was
used for the payment of the real estate taxes on the land; that during his
administration no third person ever claimed ownership over applicants land;
that he was the one who procured the execution of the affidavits of adjoining
owners (Exhs. "V", "V-1" to "V-21") which were used to support the real
estate mortgage with the DBP over said land; that from the proceeds of the
sale of the copra harvested from the land of applicants,. he paid the real
estate taxes thereon specifically the taxes covered by Exhs. "X-83" to "X-
144"; . . . that his administration over said land was adverse, open continuous
and public.
William Hankins, then 72 years old and resident (sic) of Odiongan, Romblon,
testified . . .; that ever since he was still a small kid, he know (sic) that the big
tract of land subject of their partition was already owned by his father
(Charles Hankins); that the possession of his father was in the concept of
owner, continuous, adverse, public, and open, up to his (Charles Hankins)
death; that after receiving his hereditary share from the estates of his father
and mother, he sold his said shares to Marcelino Buyco, father of applicants
by executing a Deed of Sale (Exh. "R") dated July 30, 1948; that during the
lifetime of Charles Hankins; the big tract of land was devoted primarily to
cattle grazing and to coconut and rice; that after he sold his hereditary share
of (sic) Marcelino Buyco, the latter took possession of his said portion; that
after Marcelino Buyco died, the property of Marcelino Buyco (including his
share (sic) hereditary share sold under Ex. (sic) "R") was transmitted to his
children, namely: Edgar H. Buyco, Ismael Buyco and Samuel H. Buyco (Samuel
and Edgar Buyco, the (sic) applicants herein); that he known that at present
the owners in possession of the property subject of this registration
proceedings are applicants Samuel Buyco and Edgar Buyco; that the said land
is devoted to cattle grazing and planted with coconuts and rice.
xxx xxx xxx
Jacinta Gomez Gabay, 83 years (as of October, 1979) . . . testified that she
knew the spouses Charles Hankins and Laura Crescini because since the time
she can remember, she stayed with said spouses up to the (sic) their death
(sic); that having stayed with the Hankins couple, she knew of their
properties because she lived with them in Canduyong where the property
was situated; that the property is a big tract of land; . . . that when she was
living with the Hankins spouses, said spouses already owned and were in
possession of this big tract of land, and this land was fenced off with barbed
wires, and that said big tract of land has been used for grazing purposes since
she reached the age of reason up to the present time; that during all the time
that she has been with said Hankins spouses, nobody ever claimed any
portion thereof; that this property extended from barrio Canduyong up to
barrio Anahao; that after Charles Hankins died, his property was divided
among his children Alexander Hankins, William Hankins and Lilia Hankins and
the latter's share was received by her children named Ismael, Samuel and
Edgar all surnamed Buyco; that before Charles Hankins' estate was
partitioned it was placed under the administration of Alexander Hankins (one
of the heirs); that after the partition, the portion (sic) that went to the Buyco
children (as heirs of Lilia Hankins) were administered by her husband
Gregorio Gabay; that her husband's administration over said property started
3 or 4 years after the war which (sic) lasted 25 years or until Gregorio Gabay
died; that his son-in-law Manuel Firmalo took over the administration of
applicants' property; that the land she was referring to is utilized as a pasture
land and it has been a pasture since the time it was it was owned by spouses
Charles Hankins and Laura Crescini up to the present time; that Edgar,
Samuel and Ismael, all surnamed Buyco have been receiving the fruits of the
portion that went to Lilia Hankins; that Charles Hankins' possession of that
big tract of land was in the concept of owner, continuous, adverse, open and
public; that a portion of this big tract of land went to Edgar H. Buyco, Samuel
H. Buyco and Ismael H. Buyco as the heirs of Lilia Hankins; that the
possession of the said heirs of the late Lilia Hankins over the portion that
went to them was in the concept of owner, continuous, adverse, open and
public up to the present time; that as far as she can remember the Hankins
family possessed said property for more than eighty (80) years. 14
The land registration court also summarized the testimony of private
respondent Samuel H. Buyco as to possession in this wise:
Applicant Samuel H. Buyco testified that he was 51 years of age, . . .; that
prior to the death of his grandfather Charles Hankins, that big parcel of
pastureland was about 500 to 550 hectares, the boundaries of which were
marked off by concrete monuments, some big trees, some big stones until it
was partitioned in 1948, and to fix the actual boundaries, the land was
surveyed by private surveyor Español (Exh. "D"); that during the lifetime of
their grandfather Charles Hankins this big land was primarily used as a ranch
and it was fenced off by barb (sic) wires to prevent the cattle from getting
out; that after the death of his grandfather Charles Hankins, the property
was administered by his uncle Alexander Hankins, and such administration
was terminated when there was a partition in 1948 in accordance with the
will of his grandfather; that during the administration of the property by
Alexander Hankins, this property was used as a cattle ranch, even during the
Japanese time; that after receiving their share form the partition of the
estate, they initially planted rice and coconut and later on they reverted to
cattle ranch operation (sic); that after he and his brother Edgar became the
possessor (sic) of said land, they were the one (sic) who have been harvesting
the fruits of the land; that they did not personally managed (sic) the land but
hired in 1949 the services of Mr. Gregorio Gabay to administer the estate for
them until 1970 when the latter died, and Manuel Firmalo was hired to take
over the administration until 1977 when applicant took over active
management of the property because he obtained a loan of P200,000.00
from the Development Bank of the Philippines; . . . that the land was
declared in their name (sic) for taxation purposes by their administrator
Gregorio Gabay in 1949 (Exhs. "W", "W-1" to "W-19", inclusive) and that the
taxes thereon were paid out of their own money since 1948 up to the
present (Exhs. "X", "X-1" to "X-194", inclusive); that applicants' possession in
the concept of owner over the property sought to be registered has been
open, continuous, uninterrupted, adverse and
public. 15
As earlier adverted to petitioner's appeal from the said decision was
dismissed by the public respondent for lack of merit. As to the private
respondents' title to the land subject of the application, public respondent
makes the following findings:
Undisputably, applicant-appellees anchored their title to the land in question
by means of hereditary succession as well as donation from their own father,
Marcelino Buyco, who purchased the entire hereditary share of William
Hankins (Exhs. "R"). Subsequently, applicants-appellees and their brother,
Ismael, partitioned their hereditary share from their grandparents, the
spouses Hankins, including the property donated by their father, Marcelino
Buyco, in an instrument dated September 8, 1970 (Exh. "T"). In this partition,
the share of Ismael H. Buyco went to applicant-appellee Samuel H. Buyco
(Exh. "T-1").
From the records extant in this case, it is Our considered view that from
almost (sic) time immemorial or a period of eighty (80) years, applicant-
appellees through their predecessors-in-interest have been in actual,
continuous, and peaceful possession of the property in question so that the
inescapable conclusion is that all along it is private land and had been
segregated from the dominion (sic) of the State. Thus, We sustain the
conclusion reached by the court a quo that the latter (applicants-appellees)
thru their predecessors-in-interest have acquired title by acquisitive
prescription over the same. . . . 16
As to the issue of the private respondents citizenship, public respondent held
that:
. . . it is beyond per adventure (sic) of doubt that applicants-appellees were
still Filipinos when they acquired their title thereto. From the death of their
grandfather Charles Hankins on May 31, 1937, applicants-appellees right of
succession was already vested. Moreover, as early as the year 1962, their
father Marcelino Buyco transferred his title thereto by donation inter-
vivos so that on September 8, 1970, when the Buyco brothers partitioned the
property in question, among themselves, they could validly register the same
as they already possess the necessary qualifications to have their title
perfected under the Torrens system of registration. 17
The petition is meritorious.
As could be gleaned from the evidence adduce, the private respondents do
not rely on fee simple ownership base on a Spanish grant or possessory
information title under Section 19 of the Land Registration Act; the private
respondents did not present any proof that they or their predecessors-in-
interest derived title from an old Spanish grant such as (a) the "titulo real" or
royal; (b) the "concession especial" or special grant; (c) the "composicion con
el estado" title or adjustment title; (d) the "titulo de compra" or title of
purchase; and (e) the "informacion posesoria" or possessory information
title, which could become a "titulo gratuito" or gratuitous title.18 The primary
basis of their claim is possession, by themselves and their predecessors-in-
interest, since time immemorial. The land registration court and the public
respondent are of the opinion, and so held, that the private respondents had
this in their favor. Thus, both courts declared that the land applied for had
been segregated from the public domain and had become private land.
If indeed private respondents and their predecessors have been in
possession since time immemorial, the rulings of both courts could be upheld
for, as this Court stated in Oh Cho vs. Director of Lands; 19
. . . All lands that were not acquired from the Government, either by
purchase or by grant, belong to the public domain. An exception to the rule
would be any land that should have been in the possession of an occupant
and of his predecessors in interest since time immemorial, for such
possession would justify the presumption that the land had never been part
of the public domain even before the Spanish conquest. (Cariño vs. Insular
Government, 212 U.S., 449; 53 Law. ed., 594.)20 The applicant does not come
under the exception, for the earliest possession of the lot by his first
predecessor in interest began in 1880.
This exception was reiterated in Susi vs. Razon, 21 where the first possessor
was in possession was in possession for an undetermined period of time
prior to 1880. We stated therein:
. . . In favor of Valentin Susi, there is, moreover, the presumption juris et de
jure established, in paragraph (b) of section 45 of Act No. 2874, 22 amending
Act No. 926, that all the necessary requirements for a grant by the
Government were complied with, for he has been in actual and physical
possession, personally and through his predecessors, of an agricultural land
of the public domain openly, continuously, exclusively and publicly since July
26, 1894, with a right to a certificate of title to said land under the provisions
of Chapter VIII of said Act. . . . If by a legal fiction, Valentin Susi had acquired
the land in question by a grant of the State, it had already ceased to be of the
public domain and had become private property, at least by presumption, of
Valentin Susi, beyond the control of the Director of Lands.
Although this additional pronouncement was rippled by the ruling Manila
Electric Co. vs. Castro-Bartolome 23, to the effect that land would cease to be
public only upon the issuance of a certificate of title to any Filipino citizen
claiming it under Section 48 (b) of the Public Land Act, 24 and that a piece of
land over which an imperfect title is sought to be confirmed remains public,
this Court, speaking through then Associate Justice, now Chief Justice Andres
R. Narvasa, in Director of Lands vs. Intermediate Appellate
Court,  25 reiterated the Cariño and Susi doctrine, thus:
The Court, in the light of the foregoing, is of the view, and so holds, that the
majority ruling in Meralco must be reconsidered and no longer deemed to be
binding precedent. The correct rule, as enunciated in the line of cases already
referred to, 26 is that alienable public land held by a possessor, personally or
through his predecessor-in-interest, openly, continuously and exclusively for
the prescribed statutory period (30 years under The Public Land Act, as
amended) is covered to private property by the mere lapse or completion of
said period, ipso jure.
It is obvious from the foregoing rule that the applicant must prove that (a)
the land is alienable public land and (b) his possession, in the concept
abovestated, must be either since time immemorial, as ruled in
both Cariño and Susi, or for the period prescribe in the Public Land Act. As to
the latter, this Court, in Gutierrez Hermanos vs. Court of Appeals, 27 adopted
the rule enunciated by the Court of Appeals, per then Associate Justice Hugo
E. Gutierrez, Jr., now a distinguished member of this Court, that an applicant
for registration under Section 48 of the Public Land Act must secure a
certification from the Government that the lands which he claims to have
possessed as owner for more than thirty (30) years are alienable and
disposable. It is the burden of the applicant to prove its positive averments.
In the instant case, private respondents offered no evidence at all to prove
that the property subject of the application is an alienable and disposable
parcel of land of the public domain. On the contrary, based on their own
evidence, the entire property which is alleged to have originally belonged to
Charles Hankins was pasture land. According to witness Jacinta Gomez
Gabay, this land has been pasture land, utilized for grazing purposes, since
the time it was "owned" by the spouses Charles Hankins and Laura Crescini
up to the present time (i.e., up to the date she testified). In Director of Lands
vs. Rivas, 28 this Court ruled:
Grazing lands and timber lands are not alienable under section 1, Article XIII
of the 1935 Constitution and sections 8, 10 and 11 of Article XIV of the 1973
Constitution. Section 10 distinguishes strictly agricultural lands (disposable)
from grazing lands (inalienable).
The instant application was filed, heard and decided under the regime of the
1973 Constitution.
As to the second matter to be proved, the applicant must present evidence
of an imperfect title such as those derived from the old Spanish grants. He
may also show that he has been in continuous, open and notorious
possession and occupation of agricultural lands of the public domain under
a bona fide claim of acquisition of ownership and for the period prescribed
under Section 48(b) of the Public Land Act. 29 Simply put, a person who seeks
the registration of title to a piece of land on the basis of possession by
himself and his predecessors-in-interest must prove his claim by clear and
convincing evidence; he should not rely on the weakness of the evidence of
the
oppositors. 30 This rule is certainly not new. In the 1913 case of Maloles
vs. Director of Lands,  31 this Court already held that in order that a petitioner
may be entitled to have a parcel of land registered under the Torrens system,
he has to show that he is the real and absolute owner, in fee simple, of the
said land; moreover, it is the duty of the court, even in the absence of any
oppositor, to require the petitioner to show, by a preponderance of the
evidence and by positive and absolute proof, so far as it is possible, that he is
the owner in fee simple of the land in question.
In Santiago vs. de los Santos, 32 this rule was to find anchorage in policy
considerations based no less on one of the fundamental objectives of the
Constitution, namely the conservation and utilization of our natural
resources. We held in the said case that there would be a failure to abide by
its command if the judiciary does not scrutinize with care applications to
private ownership of real estate. This Court then set the quantum of
evidence needed to be established by the applicant, to wit: well-nigh
incontrovertible evidence.
In the instant case, private respondents evidence miserably failed to
establish their imperfect title to the property in question. Their allegation of
possession since time immemorial, which was conceded by the land
registration court and the public respondent, is patently baseless. There is an
evident failure to comprehend the meaning and import of the
term immemorial. As defined, immemorial simply means beyond the reach of
memory, 33 beyond human memory, or time out of mind. 34 When referring
to possession, specifically "immemorial possession," it means possession of
which no man living has seen the beginning, and the existence of which he
has learned form his elders. 35 Such possession was never present in the case
of the private respondents. The trial court and the public respondent based
the finding of the more than eighty (80) years of possession by the private
respondents and their predecessors-in-interest on the sole testimony of Mrs.
Gabay who was eighty-three (83) years old when she testified in October of
1979. Thus, she must have been born in 1896. If the asserted possession
lasted for a period of more than eighty (80) years at the time she testified the
same must have commenced sometime in 1899, or at the time that she was
barely three (3) years old. It is quite impossible that she could fully grasp,
before coming to the age of reason, the concept of possession of such a big
tract of land and testify on the same some eight (8) decades later. In short,
therefore, she cannot be relied upon to prove the possession by Charles
Hankins of the said property from 1899.
Charles Hankins was an American citizen. There is no evidence to show the
date of his birth, his arrival in the Philippines — particularly in Odiongan,
Romblon — or his acquisition of the big tract of land; neither is there any
evidence to prove the manner of his acquisition thereof. Thus, there does not
even exist a reasonable basis for the finding that the private respondents and
their predecessors-in-interest possessed the land for more than eighty (80)
years, much less since time immemorial. In Oh Cho vs. Director of
Lands, 36 possession which began in 1880 was not considered as possession
"since time immemorial."
There is as well, no evidence on record to show that Charles Hankins
cultivated, had control over or used the whole or even a greater portion of
the big tract of land for grazing purposes. None of the witnesses testified as
to the number of heads of cattle which were bought by Charles into the land.
There is likewise no competent proof that he declared the land in his name
for taxation purposes or that he had paid the taxes thereon. Although his will
(Exhibit "N") made mention of Tax Declaration No. 15853, neither the said
declaration nor any tax receipt was presented in evidence. Because of such
non-production, it cannot be determined when Charles initially declared his
alleged land for taxation purpose and what exactly were its natural
boundaries, if any. It is clear that the non-production of this tax declaration
accounted for the obvious inability of the witnesses to testify with certainty
as to the extent of the area of the property. As correctly observed by the
petitioner, none of the private respondents' witnesses could give the court a
definite idea thereon. Thus, Samuel Buyco declared:
I really don't know the exact area, but it is between 500 to 550 hectares. 37
while William Hankins admitted:
I cannot exactly tell because that is a very big estate. 38
On the other hand, witness Jacinta Gomez Gabay averred:
I could not exactly tell but I have heard that it was a big tract of land because
we were staying there. 39
In any event, even if Charles had indeed declared the property for taxation
purposes and actually paid taxes, such facts are still insufficient to justify
possession thereof, much less a claim of ownership thereon. This Court has
repeatedly held that the declaration of ownership for purposes of
assessment on the payment of the tax is not sufficient to prove ownership. 40
To this Court's mind, private respondents failed to prove that Charles
Hankins had possessed the property — allegedly covered by Tax Declaration
No. 15853 and made the subject of both his last will and testament and the
project of partition of his estate among his heirs — in such a manner as to
remove the same from the public domain under the Cariño and Susi
doctrines. Thus, when he died on 31 May 1937, he transmitted no right
whatsoever, with respect to the said property, to his heirs. This being the
case, his possession cannot be tacked to that of the private respondents for
the latter's benefit pursuant to Section 48(b) of the Public Land Act, the
alternative ground relied upon in their application. It would have been
entirely different if the possession of Charles was open, continuous,
exclusive, notorious and under a bona fide claim of ownership as provided
under Section 48 of the Public Land Act. Even if he were an American citizen
at that time, he would have had the same civil rights as Filipino citizens
pursuant to the original ordinance appended to the 1935 Constitution. the
pertinent portion of said ordinance reads:
(17) Citizens and corporations of the United States shall enjoy in the
Commonwealth of the Philippines all the civil rights of the citizens and
corporations, respectively, thereof.
The import of said paragraph (17) was confirmed and reinforced the
originally by Section 44 of Act No. 2874 and Section 127 of C.A. No. 141 (The
Public Land Act of 1936); the latter provided that:
Sec. 127. During the existence and continuance of the Commonwealth and
before the Republic of the Philippines is established, citizens and corporations
of the United States shall enjoy the same rights granted to citizens and
corporations of the Philippines under this Act.
This right, however, vanished with the advent of the Philippine Republic on 4
July 1946. 41
Verily, private respondents had to rely exclusively on their own possession.
under the applicable law at the time, it was incumbent upon them to prove
that they had been in open, continuous, exclusive and notorious possession
and occupation of agricultural land of the public domain, under a bona
fide claim of acquisition of ownership for at least thirty (30) years
immediately preceding the filing of the applications for confirmation of title,
except when prevented by war or force majeure. 42
By their own evidence, private respondents admitted that they were never in
actual possession of the property prior to the filing of their application.
During the pendency of Special Proceedings No. 796, the estate of Charles
Hankins appeared to have been administered by his son Alexander. This
administration was terminated in 1948 upon the execution of the Project of
Partition. Private respondents and their brother Ismael did not take
possession of the share which pertained to their mother, Lilia; instead; they
allegedly hired Gregorio Gabay to administer the same. There is, however, no
competent evidence to show the extent of such administration. Moreover,
notwithstanding the fact that Gregorio had the property declared for
taxation purposes, the correct area and boundaries of the same have not
been proven. As evidenced by the Project of Partition, the share of Lilia was
only 125 acres or 50.59 hectares, which is clearly not the portion applied for.
The area applied for consists of 319.4788 hectares of land based on a survey
plan prepared by private land surveyor Español on the basis of a survey
conducted in 1950. Obviously, therefore, the plan was not prepared to
determine Lilia's share alone for, as admitted by the private respondents
themselves, this plan includes William Hankins' share which was sold to
Marcelino Buyco, private respondents father, and the other properties which
the latter donated to the private respondents and Ismael Buyco on 20 August
1962 (Exhibit "S"). However, there is no competent evidence as to the
respective boundaries and areas of the properties constituting the said share
of William Hankins; neither are there reliable descriptions of the other
alleged properties belonging to Marcelino Buyco. Be that as it may, when the
survey was conducted by Español, private respondents and their brother
Ismael did not immediately acquire the portion originating from William
Hankins and the other alleged properties of Marcelino Buyco; hence, there
was no valid basis for the inclusion of said properties in the survey. And even
if both William's share and Marcelino Buyco's properties were included there
would still be nothing to support the application for the entire 319,4788
hectares considering that as per the Project of Partition, the share pertaining
to William consisted only of 50.59 hectares. There was, moreover, no
evidence to show the extent of the alleged "other properties" of Marcelino
Buyco. Given such circumstances, it would be reasonable to presume that
what was surveyed in 1950 was the entire pasture land alleged to form part
of the estate of Charles Hankins, covered by Tax Declaration No. 15853, and
which necessarily included the share of Alexander Hankins. Significantly, per
Exhibit "O" the latter's share is specified as part of the property covered by
Tax Declaration No. 15853. The inclusion then of Alexander's share in the
survey and the plan may provide the clue to this unusual increase in the area
covered by the survey plan.
Nevertheless, even if We are to assume for argument's sake that there was
nothing irregular in the inclusion in the survey plan of the share of William
Hankins and the other properties of Marcelino Buyco, the fact remains that
the "ownership" thereof could have been acquired by the private
respondents and Ismael Buyco only on 20 August 1962 upon the execution of
the deed of donation in their favor. To be thus benefited by the possession of
William or Marcelino for purposes of Section 48 (b) of the Public Land Act,
there should be proof that said predecessors had been in open, continuous,
exclusive and notorious possession and occupation thereof. Unfortunately,
no such proof was offered.
It is palpably obvious then that at the time Land Registration Case No. N-48
was filed in the Regional Trial Court of Romblon on 14 October 1976, private
respondents did not have in their favor an imperfect title over that which
they claimed to have inherited, by representation, from the estate of Charles
Hankins. With greater force does this conclusion likewise apply with respect
to the properties donated to them in 1962 by their father Marcelino Buyco.
This is because they were not able to prove open, continuous, exclusive and
notorious possession and occupation thereof under a bona fide claim of
acquisition of ownership for at least thirty (30) years immediately preceding
the filing of the application, 43 or from 12 June 1945. 44
Considering that the private respondents became American citizens before
such filing, it goes without saying that they had acquired no vested right,
consisting of an imperfect title over to property before they lost their
Philippine citizenship.

WHEREFORE, the Petition is GRANTED. The challenged Decision of the public

respondent of 21 November 1989 in CA-G.R. CV No. 05824 is hereby SET
ASIDE and the Decision of 5 February 1985 of Branch 82 of the Regional Trial
Court of Romblon in Land Registration Case No. N-48, LRC Record No. N-
51706 is REVERSED.

Costs against the private respondents.

SO ORDERED.

G.R. No. 108998 August 24, 1994

REPUBLIC OF THE PHILIPPINES, petitioner,
vs.
THE COURT OF APPEALS AND SPOUSES MARIO B. LAPIÑA AND FLOR DE
VEGA, respondents.
Byron V. Belarmino and Juan B. Belarmino for private respondents.
BIDIN, J.:
Can a foreign national apply for registration of title over a parcel of land
which he acquired by purchase while still a citizen of the Philippines, from a
vendor who has complied with the requirements for registration under the
Public Land Act (CA 141)?
The Republic would have us rule on the negative and asks this Court to nullify
the decision of the appellate court which affirmed the judgment of the
court a quo in granting the application of respondent spouses for
registration over the lots in question.
On June 17, 1978, respondent spouses bought Lots 347 and 348, Cad. s38-D,
as their residence with a total area of 91.77 sq. m. situated in San Pablo City,
from one Cristeta Dazo Belen (Rollo, p. 41). At the time of the purchase,
respondent spouses where then natural-born Filipino citizens.
On February 5, 1987, the spouses filed an application for registration of title
of the two (2) parcels of land before the Regional Trial Court of San Pablo
City, Branch XXXI. This time, however, they were no longer Filipino citizens
and have opted to embrace Canadian citizenship through naturalization.
An opposition was filed by the Republic and after the parties have presented
their respective evidence, the court a quo rendered a decision confirming
private respondents' title to the lots in question, the dispositive portion of
which reads as follows:
WHEREFORE, in view of the foregoing, this Court hereby approves the said
application and confirms the title and possession of herein applicants over
Lots 347 and 348, Ap-04-003755 in the names of spouses Mario B. Lapiña
and Flor de Vega, all of legal age, Filipino citizens by birth but now Canadian
citizens by naturalization and residing at 14 A. Mabini Street, San Pablo City
and/or 201-1170-124 Street, Edmonton, Alberta T5M-OK9, Canada.
Once this Decision becomes final, let the corresponding decree of
registration be issued. In the certificate of title to be issued, there shall be
annotated an easement of .265 meters road right-of-way.
SO ORDERED. (Rollo, p. 25)
On appeal, respondent court affirmed the decision of the trial court based on
the following ratiocination:
In the present case, it is undisputed that both applicants were still Filipino
citizens when they bought the land in controversy from its former owner. For
this reason, the prohibition against the acquisition of private lands by aliens
could not apply. In justice and equity, they are the rightful owners of the
subject realty considering also that they had paid for it quite a large sum of
money. Their purpose in initiating the instant action is merely to confirm
their title over the land, for, as has been passed upon, they had been the
owners of the same since 1978. It ought to be pointed out that registration is
not a mode of acquiring ownership. The Torrens System was not established
as a means for the acquisition of title to private land. It is intended merely to
confirm and register the title which one may already have (Municipality of
Victorias vs. Court of Appeals, G.R. No. L-31189, March 31, 1987). With
particular reference to the main issue at bar, the High Court has ruled that
title and ownership over lands within the meaning and for the purposes of
the constitutional prohibition dates back to the time of their purchase, not
later. The fact that the applicants-appellees are not Filipino citizens now
cannot be taken against them for they were not disqualified from acquiring
the land in question (Bollozos vs. Yu Tieng Su, G.R. No. L-29442, November
11, 1987). (Rollo, pp. 27-28)
Expectedly, respondent court's disposition did not merit petitioner's
approval, hence this present recourse, which was belatedly filed.
Ordinarily, this petition would have been denied outright for having been
filed out of time had it not been for the constitutional issue presented
therein.
At the outset, petitioner submits that private respondents have not acquired
proprietary rights over the subject properties before they acquired Canadian
citizenship through naturalization to justify the registration thereof in their
favor. It maintains that even privately owned unregistered lands are
presumed to be public lands under the principle that lands of whatever
classification belong to the State under the Regalian doctrine. Thus, before
the issuance of the certificate of title, the occupant is not in the jurisdical
sense the true owner of the land since it still pertains to the State. Petitioner
further argued that it is only when the court adjudicates the land to the
applicant for confirmation of title would the land become privately owned
land, for in the same proceeding, the court may declare it public land,
depending on the evidence.
As found by the trial court:
The evidence thus presented established that applicants, by themselves and
their predecessors-in-interest, had been in open, public, peaceful,
continuous, exclusive and notorious possession and occupation of the two
adjacent parcels of land applied for registration of title under a bona-fide
claim of ownership long before June 12, 1945. Such being the case, it is
conclusively presumed that all the conditions essential to the confirmation of
their title over the two adjacent parcels of land are sought to be registered
have been complied with thereby entitling them to the issuance of the
corresponding certificate of title pursuant to the provisions of Presidential
Decree No. 1529, otherwise known as the Property Registration Decree.
(Rollo, p. 26)
Respondent court echoed the court a quo's observation, thus:
The land sought to be registered has been declared to be within the alienable
and disposable zone established by the Bureau of Forest Development
(Exhibit "P"). The investigation conducted by the Bureau of Lands, Natural
Resources District (IV-2) reveals that the disputed realty had been occupied
by the applicants "whose house of strong materials stands thereon"; that it
had been declared for taxation purposes in the name of applicants-spouses
since 1979; that they acquired the same by means of a public instrument
entitled "Kasulatan ng Bilihang Tuluyan" duly executed by the vendor,
Cristeta Dazo Belen, on June 17, 1978 (Exhibits "I" and "J"); and that
applicants and their predecessors in interest had been in possession of the
land for more than 30 years prior to the filing of the application for
registration. But what is of great significance in the instant case is the
circumstance that at the time the applicants purchased the subject lot in
1978, both of them were Filipino citizens such that when they filed their
application for registration in 1987, ownership over the land in dispute had
already passed to them. (Rollo, p., 27)
The Republic disagrees with the appellate court's concept of possession and
argues:
17. The Court of Appeals found that the land was declared for taxation
purposes in the name of respondent spouses only since 1979. However, tax
declarations or reality tax payments of property are not conclusive evidence
of ownership. (citing cases)
18. Then again, the appellate court found that "applicants (respondents) and
their predecessors-in-interest had been in possession of the land for more
than 30 years prior to the filing of the application for registration." This is not,
however, the same as saying that respondents have been in possession
"since June 12, 1945." (PD No. 1073, amending Sec. 48 [b], CA NO. 141; sec.
also Sec. 14, PD No. 1529). So there is a void in respondents' possession.
They fall short of the required possession since June 12, 1945 or prior
thereto. And, even if they needed only to prove thirty (30) years possession
prior to the filing of their application (on February 5, 1987), they would still
be short of the required possession if the starting point is 1979 when,
according to the Court of Appeals, the land was declared for taxation
purposes in their name. (Rollo, pp. 14-15)
The argument is myopic, to say the least. Following the logic of petitioner,
any transferee is thus foreclosed to apply for registration of title over a
parcel of land notwithstanding the fact that the transferor, or his
predecessor-in-interest has been in open, notorious and exclusive possession
thereof for thirty (30) years or more. This is not, however, what the law
provides.
As petitioner itself argues, Section 48 of the Public Land Act (CA 141) reads:
Sec. 48. The following-described citizens of the Philippines, occupying lands
of the public domain or claiming interest therein, but whose titles have not
been perfected or completed, may apply to the Court of First Instance (now
Regional Trial Court) of the province where the land is located for
confirmation of their claims and the issuance of a certificate of title therefor
under the Land Registration Act, to wit:
xxx xxx xxx
(b) Those who by themselves or through their predecessors-in-interest have
been in open, continuous, exclusive, and notorious possession and occupation
of agricultural lands of the public domain, under a bona fide claim of
acquisition or ownership, for at least thirty years immediately preceding the
filing of the application for confirmation of title except when prevented by
wars or force majeure. These shall be conclusively presumed to have
performed all the conditions essential to a Government grant and shall be
entitled to a certificate of title under the provisions of this chapter. (Emphasis
supplied)
As amended by PD 1073:
Sec. 4. The provisions of Section 48(b) and Section 48(c), Chapter VIII, of the
Public Land Act are hereby amended in the sense that these provisions shall
apply only to alienable and disposable lands of the public domain which have
been in open, continuous, exclusive and notorious possession and
occupation by the applicant himself or thru his predecessor-in-interest,
under a bona fide claim of acquisition or ownership, since June 12, 1945.
It must be noted that with respect to possession and occupation of the
alienable and disposable lands of the public domain, the law employs the
terms "by themselves", "the applicant himself or through his predecessor-in-
interest". Thus, it matters not whether the vendee/applicant has been in
possession of the subject property for only a day so long as the period and/or
legal requirements for confirmation of title has been complied with by his
predecessor-in-interest, the said period is tacked to his possession. In the
case at bar, respondents' predecessors-in-interest have been in open,
continuous, exclusive and notorious possession of the disputed land not only
since June 12, 1945, but even as early as 1937. Petitioner does not deny this
except that respondent spouses, in its perception, were in possession of the
land sought to be registered only in 1978 and therefore short of the required
length of time. As aforesaid, the disputed parcels of land were acquired by
private respondents through their predecessors-in-interest, who, in turn,
have been in open and continued possession thereof since 1937. Private
respondents stepped into the shoes of their predecessors-in-interest and by
virtue thereof, acquired all the legal rights necessary to confirm what could
otherwise be deemed as an imperfect title.
At this juncture, petitioner's reliance in Republic v. Villanueva (114 SCRA 875
[1982]) deserves scant consideration. There, it was held that before the
issuance of the certificate of title, the occupant is not in the juridical sense
the true owner of the land since it still pertains to the State.
Suffice it to state that the ruling in Republic v. Villanueva (supra), has already
been abandoned in the 1986 case of Director of Lands v. Intermediate
Appellate Court (146 SCRA 509; and reiterated in Director of Lands v. Iglesia
ni Cristo, 200 SCRA 606 [1991]) where the Court, through then Associate
Justice, now Chief Justice Narvasa, declared that:
(The weight of authority is) that 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. . . .
Herico in particular, appears to be squarely affirmative:
. . . Secondly, under the provisions of Republic Act
No. 1942, which the respondent Court held to be inapplicable to the
petitioner's case, with the latter's proven occupation and cultivation for more
than 30 years since 1914, by himself and by his predecessors-in-interest, title
over the land has vested on petitioner so as to segregate the land from the
mass of public land. Thereafter, it is no longer disposable under the Public
Land Act as by free patent . . .
x x x           x x x          x x x
As interpreted in several cases, when the conditions as specified in the
foregoing provision are complied with, the possessor is deemed to have
acquired, by operation of law, a right to a grant, a government grant, without
the necessity of a certificate of title being issued. The land, therefore, ceases
to be of the public domain and beyond the authority of the Director of Lands
to dispose of. The application for confirmation is mere formality, the lack of
which does not affect the legal sufficiency of the title as would be evidenced
by the patent and the Torrens title to be issued upon the strength of said
patent.
Nothing can more clearly demonstrate the logical inevitability of considering
possession of public land which is of the character and duration prescribed
by the statute as the equivalent of an express grant from the State than the
dictum of the statute itself (Section 48 [b]) that the possessor(s) ". . . shall be
conclusively presumed to have performed all the conditions essential to a
Government grant and shall be entitled to a certificate of title ..." No proof
being admissible to overcome a conclusive presumption, confirmation
proceedings would, in truth be little more than a formality, at the most
limited to ascertaining whether the possession claims is of the required
character and length of time; and registration thereunder would not confer
title, but simply recognize a title already vested. The proceedings would not
originally convert the land from public to private land, but only confirm such
a conversion already affected by operation of law from the moment the
required period of possession became complete. As was so well put in Cariño,
". . .(There are indications that registration was expected from all, but none
sufficient to show that, for want of it, ownership actually gained would be
lost. The effect of the proof, wherever made, was not to confer title, but
simply to establish it, as already conferred by the decree, if not by earlier law.
(Emphasis supplied)
Subsequent cases have hewed to the above pronouncement such that open,
continuous and exclusive possession for at least 30 years of alienable public
land ipso jure converts the same to private property (Director of Lands v. IAC,
214 SCRA 604 [1992]; Pineda v. CA, 183 SCRA 602 [1990]). This means that
occupation and cultivation for more than 30 years by an applicant and his
predecessors-in-interest, vest title on such applicant so as to segregate the
land from the mass of public and (National Power Corporation v. CA, 218
SCRA 41 [1993]).
The Public Land Act requires that the applicant must prove that (a) the land is
alienable public land and (b) his possession, in the concept above stated,
must be either since time immemorial or for the period prescribed in the
Public Land Act (Director of Lands v. Buyco, 216 SCRA 78 [1992]). When the
conditions set by law are complied with, the possessor of the land, by
operation of law, acquires a right to a grant, a government grant, without the
necessity of a certificate of title being issued (National Power Corporation v.
CA, supra). As such, the land ceases to be a part of the public domain and
goes beyond the authority of the Director of Lands to dispose of.
In other words, the Torrens system was not established as a means for the
acquisition of title to private land (Municipality of Victorias v. CA, 149 SCRA
32 [1987]). It merely confirms, but does not confer ownership. As could be
gleaned from the evidence adduced, private respondents were able to
establish the nature of possession of their predecessors-in-interest. Evidence
was offered to prove that their predecessors-in-interest had paid taxes on
the subject land and introduced improvements thereon (Exhibits "F" to "F9").
A certified true copy of the affidavit executed by Cristeta Dazo and her sister
Simplicia was also formally offered to prove that the subject parcels of land
were inherited by vendor Cristeta Dazo from her father Pedro Dazo with the
conformity of her only sister Simplicia (Exhibit "G"). Likewise, a report from
the Bureau of Lands was presented in evidence together with a letter from
the Bureau of Forest Development, to prove that the questioned lots were
part of the alienable and disposable zone of the government and that no
forestry interest was affected (CA GR No. 28953, Records, p. 33).
In the main, petitioner seeks to defeat respondents' application for
registration of title on the ground of foreign nationality. Accordingly, the
ruling in Director of Lands v. Buyco (supra) supports petitioner's thesis.
We disagree.
In Buyco, the applicants therein were likewise foreign nationals but were
natural-born Filipino citizens at the time of their supposed acquisition of the
property. But this is where the similarity ends. The applicants in Buyco sought
to register a large tract of land under the provisions of the Land Registration
Act, and in the alternative, under the provisions of the Public Land Act. The
land registration court decided in favor of the applicants and was affirmed by
the appellate court on appeal. The Director of Lands brought the matter
before us on review and we reversed.
This Court, speaking through Justice Davide, Jr., stated:
As could be gleaned from the evidence adduced, the private respondents do
not rely on fee simple ownership based on a Spanish grant or possessory
information title under Section 19 of the Land Registration Act; the private
respondents did not present any proof that they or their predecessors-in-
interest derived title from an old Spanish grant such as (a) the "titulo real" or
royal grant (b) the "concession especial" or especial grant; (c) the
"composicion con el estado" title or adjustment title; (d) the "titulo de
compra" or title by purchase; and (e) the "informacion posesoria" or
possessory information title, which could become a "titulo gratuito" or a
gratuitous title (Director of Forestry v. Muñoz, 23 SCRA 1183 [1968]). The
primary basis of their claim is possession, by themselves and their
predecessors-in-interest, since time immemorial.
If indeed private respondents and their predecessors have been in
possession since time immemorial, the rulings of both courts could be upheld
for, as this Court stated in Oh Cho v. Director of Lands (75 Phil. 890 [1946]):
. . . All lands that were not acquired from the Government, either by
purchase or by grant, belong to the public domain. An exception to the rule
would be any land that should have been in the possession of an occupant
and of his predecessors in interest since time immemorial, for such
possession would justify the presumption that the land had never been part
of the public domain or that if had been a private property even before the
Spanish conquest (Cariño v. Insular Government, 41 Phil 935 [1909]; 212 U.S.
449; 53 Law. Ed., 594) The applicant does not come under the exception, for
the earliest possession of the lot by his first predecessor in interest began in
1880.
. . . alienable public land held by a possessor, personally or through his
predecessors-in-interest, openly, continuously and exclusively for the
prescribed statutory period (30 years under the Public Land Act, as amended)
is converted to private property by the mere lapse or completion of said
period, ipso jure. (Director of Lands v. Intermediate Appellate Court, supra)
It is obvious from the foregoing rule that the applicant must prove that (a)
the land is alienable public land and (b) his possession, in the concept above
stated, must be either since time immemorial, as ruled in both Cariño and
Susi, or for the period prescribed in the Public Land Act. As to the latter, this
Court, in Gutierrez Hermanos v. Court of Appeals (178 SCRA 37 [1989]),
adopted the rule enunciated by the Court of Appeals, per then Associate
Justice Hugo R. Gutierrez, Jr., . . ., that an applicant for registration under
Section 48 of the Public Land Act must secure a certification from the
Government that the lands which he claims to have possessed as owner for
more than thirty (30) years are alienable and disposable. It is the burden of
the applicant to prove its positive averments.
In the instant case, private respondents offered no evidence at all to prove
that the property subject of the application is an alienable and disposable
land. On the contrary, the entire property . . . was pasture land (and
therefore inalienable under the then 1973 Constitution).
. . . (P)rivate respondents' evidence miserably failed to establish their
imperfect title to the property in question. Their allegation of possession
since time immemorial, . . ., is patently baseless. . . . When referring to
possession, specifically "immemorial possession," it means possession of
which no man living has seen the beginning, and the existence of which he
has learned from his elders (Susi v. Razon, supra). Such possession was never
present in the case of private respondents. . . .
. . ., there does not even exist a reasonable basis for the finding that the
private respondents and their predecessors-in-interest possessed the land
for more than eighty (80) years, . . .
xxx xxx xxx
To this Court's mind, private respondents failed to prove that (their
predecessor-in-interest) had possessed the property allegedly covered by Tax
Declaration No. 15853 and made the subject of both his last will and
testament and the project of partition of his estate among his heirs — in such
manner as to remove the same from the public domain under the Cariño and
Susi doctrines. Thus, (when the predecessor-in-interest) died on 31 May
1937, he transmitted no right whatsoever, with respect to the said property,
to his heirs. This being the case, his possession cannot be tacked to that of
the private respondents for the latter's benefit pursuant to Section 48(b) of
the Public Land Act, the alternative ground relied upon in their
application . . .
xxx xxx xxx
Considering that the private respondents became American citizens before
such filing, it goes without saying that they had acquired no vested right,
consisting of an imperfect title, over the property before they lost their
Philippine citizenship. (Emphasis supplied)
Clearly, the application in Buyco were denied registration of title not merely
because they were American citizens at the time of their application
therefor. Respondents therein failed to prove possession of their
predecessor-in-interest since time immemorial or possession in such a
manner that the property has been segregated from public domain; such
that at the time of their application, as American citizens, they have acquired
no vested rights over the parcel of land.
In the case at bar, private respondents were undoubtedly natural-born
Filipino citizens at the time of the acquisition of the properties and by virtue
thereof, acquired vested rights thereon, tacking in the process, the
possession in the concept of owner and the prescribed period of time held by
their predecessors-in-interest under the Public Land Act. In addition, private
respondents have constructed a house of strong materials on the contested
property, now occupied by respondent Lapiñas mother.
But what should not be missed in the disposition of this case is the fact that
the Constitution itself allows private respondents to register the contested
parcels of land in their favor. Sections 7 and 8 of Article XII of the
Constitution contain the following pertinent provisions, to wit:
Sec. 7. Save in cases of hereditary succession, no private lands shall be
transferred or conveyed except to individuals, corporations, or associations
qualified to acquire or hold lands of the public domain.
Sec. 8. Notwithstanding the provisions of Section 7 of this Article, a natural-
born citizen of the Philippines who has lost his Philippine citizenship may be a
transferee of private lands, subject to limitations provided by law. (Emphasis citizenship and the country of which he is presently a citizen; and such other
supplied) information as may be required under Section 8 of this Act.

Section 8, Article XII of the 1987 Constitution above quoted is similar to
Section 15, Article XIV of the then 1973 Constitution which reads:
Sec. 15. Notwithstanding the provisions of Section 14 of this Article, a
natural-born citizen of the Philippines who has lost his citizenship may be a
transferee of private land, for use by him as his residence, as the Batasang
Pambansa may provide.
Pursuant thereto, Batas Pambansa Blg. 185 was passed into law, the relevant
provision of which provides:
Sec. 2. Any natural-born citizen of the Philippines who has lost his Philippine
citizenship and who has the legal capacity to enter into a contract under
Philippine laws may be a transferee of a private land up to a maximum area
of one thousand square meters, in the case of urban land, or one hectare in
the case of rural land, to be used by him as his residence. In the case of
married couples, one of them may avail of the privilege herein granted;
Provided, That if both shall avail of the same, the total area acquired shall
not exceed the maximum herein fixed.
In case the transferee already owns urban or rural lands for residential
purposes, he shall still be entitled to be a transferee of an additional urban or
rural lands for residential purposes which, when added to those already
owned by him, shall not exceed the maximum areas herein authorized.
The Court is of the view that the requirements in Sec. 6 of BP 185 do not
apply in the instant case since said requirements are primarily directed to the
register of deeds before whom compliance therewith is to be submitted.
Nowhere in the provision is it stated, much less implied, that the
requirements must likewise be submitted before the land registration court
prior to the approval of an application for registration of title. An application
for registration of title before a land registration court should not be
confused with the issuance of a certificate of title by the register of deeds. It
is only when the judgment of the land registration court approving the
application for registration has become final that a decree of registration is
issued. And that is the time when the requirements of Sec. 6, BP 185, before
the register of deeds should be complied with by the applicants. This decree
of registration is the one that is submitted to the office of the register of
deeds for issuance of the certificate of title in favor of the applicant. Prior to
the issuance of the decree of registration, the register of deeds has no
participation in the approval of the application for registration of title as the
decree of registration is yet to be issued.
WHEREFORE, the petition is DISMISSED and the decision appealed from is
hereby AFFIRMED.
SO ORDERED.

From the adoption of the 1987 Constitution up to the present, no other law
has been passed by the legislature on the same subject. Thus, what governs
the disposition of private lands in favor of a natural-born Filipino citizen who
has lost his Philippine citizenship remains to be BP 185.

Even if private respondents were already Canadian citizens at the time they
applied for registration of the properties in question, said properties as
discussed above were already private lands; consequently, there could be no
legal impediment for the registration thereof by respondents in view of what
the Constitution ordains. The parcels of land sought to be registered no
longer form part of the public domain. They are already private in character
since private respondents' predecessors-in-interest have been in open,
continuous and exclusive possession and occupation thereof under claim of
ownership prior to June 12, 1945 or since 1937. The law provides that a
natural-born citizen of the Philippines who has lost his Philippine citizenship
may be a transferee of a private land up to a maximum area of 1,000 sq.m., if
urban, or one (1) hectare in case of rural land, to be used by him as his
residence (BP 185).

It is undisputed that private respondents, as vendees of a private land, were

natural-born citizens of the Philippines. For the purpose of transfer and/or
acquisition of a parcel of residential land, it is not significant whether private
respondents are no longer Filipino citizens at the time they purchased or
registered the parcels of land in question. What is important is that private
respondents were formerly natural-born citizens of the Philippines, and as
transferees of a private land, they could apply for registration in accordance
with the mandate of Section 8, Article XII of the Constitution. Considering
that private respondents were able to prove the requisite period and
character of possession of their predecessors-in-interest over the subject
lots, their application for registration of title must perforce be approved.

The dissenting opinion, however, states that the requirements in BP 185,

must also be complied with by private respondents. Specifically, it refers to
Section 6, which provides:

Sec. 6. In addition to the requirements provided for in other laws for the
registration of titles to lands, no private land shall be transferred under this
Act, unless the transferee shall submit to the register of deeds of the
province or city where the property is located a sworn statement showing
the date and place of his birth; the names and addresses of his parents, of his
spouse and children, if any; the area, the location and the mode of G.R. No. 195670               December 3, 2012
acquisition of his landholdings in the Philippines, if any; his intention to
reside permanently in the Philippines; the date he lost his Philippine
WILLEM BEUMER, Petitioner,
vs.
AVELINA AMORES, Respondent.
DECISION
PERLAS-BERNABE, J.:
Before the Court is a Petition for Review on Certiorari1 under Rule 45 of the
Rules of CoLlli assailing the October 8, 2009 Decision2 and January 24, 2011
Resolution3 of the court of Appeals (CA) in CA-G.R. CV No. 01940, which
affirmed the February 28, 2007 Decision4 of the Regional Trial Court (RTC) of
Negros Oriental, Branch 34 in Civil Case No. I 2884. The foregoing rulings
dissolved the conjugal partnership of gains of Willem Beumer (petitioner)
and Avelina Amores (respondent) and distributed the properties forming part
of the said property regime.
The Factual Antecedents
Petitioner, a Dutch National, and respondent, a Filipina, married in March 29,
1980. After several years, the RTC of Negros Oriental, Branch 32, declared
the nullity of their marriage in the Decision5 dated November 10, 2000 on the
basis of the former’s psychological incapacity as contemplated in Article 36 of
the Family Code.
Consequently, petitioner filed a Petition for Dissolution of Conjugal
Partnership6 dated December 14, 2000 praying for the distribution of the
following described properties claimed to have been acquired during the
subsistence of their marriage, to wit:
By Purchase:
a. Lot 1, Block 3 of the consolidated survey of Lots 2144 & 2147 of the
Dumaguete Cadastre, covered by Transfer Certificate of Title (TCT) No.
22846, containing an area of 252 square meters (sq.m.), including a
residential house constructed thereon.
b. Lot 2142 of the Dumaguete Cadastre, covered by TCT No. 21974,
containing an area of 806 sq.m., including a residential house constructed
thereon.
c. Lot 5845 of the Dumaguete Cadastre, covered by TCT No. 21306,
containing an area of 756 sq.m.
d. Lot 4, Block 4 of the consolidated survey of Lots 2144 & 2147 of the
Dumaguete Cadastre, covered by TCT No. 21307, containing an area of 45
sq.m.
By way of inheritance:
e. 1/7 of Lot 2055-A of the Dumaguete Cadastre, covered by TCT No. 23567,
containing an area of 2,635 sq.m. (the area that appertains to the conjugal
partnership is 376.45 sq.m.).
f. 1/15 of Lot 2055-I of the Dumaguete Cadastre, covered by TCT No. 23575,
containing an area of 360 sq.m. (the area that appertains to the conjugal
partnership is 24 sq.m.).7
In defense,8 respondent averred that, with the exception of their two (2)
residential houses on Lots 1 and 2142, she and petitioner did not acquire any
conjugal properties during their marriage, the truth being that she used her
own personal money to purchase Lots 1, 2142, 5845 and 4 out of her
personal funds and Lots 2055-A and 2055-I by way of inheritance.9 She
submitted a joint affidavit executed by her and petitioner attesting to the fact
that she purchased Lot 2142 and the improvements thereon using her own
money.10 Accordingly, respondent sought the dismissal of the petition for
dissolution as well as payment for attorney’s fees and litigation expenses.11
During trial, petitioner testified that while Lots 1, 2142, 5845 and 4 were
registered in the name of respondent, these properties were acquired with
the money he received from the Dutch government as his disability
benefit12 since respondent did not have sufficient income to pay for their
acquisition. He also claimed that the joint affidavit they submitted before the
Register of Deeds of Dumaguete City was contrary to Article 89 of the Family
Code, hence, invalid.13
For her part, respondent maintained that the money used for the purchase
of the lots came exclusively from her personal funds, in particular, her
earnings from selling jewelry as well as products from Avon, Triumph and
Tupperware.14 She further asserted that after she filed for annulment of their
marriage in 1996, petitioner transferred to their second house and brought
along with him certain personal properties, consisting of drills, a welding
machine, grinders, clamps, etc. She alleged that these tools and equipment
have a total cost of P500,000.00.15
The RTC Ruling
On February 28, 2007, the RTC of Negros Oriental, Branch 34 rendered its
Decision, dissolving the parties’ conjugal partnership, awarding all the parcels
of land to respondent as her paraphernal properties; the tools and
equipment in favor of petitioner as his exclusive properties; the two (2)
houses standing on Lots 1 and 2142 as co-owned by the parties, the
dispositive of which reads:
WHEREFORE, judgment is hereby rendered granting the dissolution of the
conjugal partnership of gains between petitioner Willem Beumer and
respondent Avelina Amores considering the fact that their marriage was
previously annulled by Branch 32 of this Court. The parcels of land covered
by Transfer Certificate of Titles Nos. 22846, 21974, 21306, 21307, 23567 and
23575 are hereby declared paraphernal properties of respondent Avelina
Amores due to the fact that while these real properties were acquired by
onerous title during their marital union, Willem Beumer, being a foreigner, is
not allowed by law to acquire any private land in the Philippines, except
through inheritance.
The personal properties, i.e., tools and equipment mentioned in the
complaint which were brought out by Willem from the conjugal dwelling are
hereby declared to be exclusively owned by the petitioner.
The two houses standing on the lots covered by Transfer Certificate of Title
Nos. 21974 and 22846 are hereby declared to be co-owned by the petitioner
and the respondent since these were acquired during their marital union and
since there is no prohibition on foreigners from owning buildings and
residential units. Petitioner and respondent are, thereby, directed to subject
this court for approval their project of partition on the two houses
aforementioned.
The Court finds no sufficient justification to award the counterclaim of
respondent for attorney’s fees considering the well settled doctrine that
there should be no premium on the right to litigate. The prayer for moral
damages are likewise denied for lack of merit.
No pronouncement as to costs.
SO ORDERED.16
It ruled that, regardless of the source of funds for the acquisition of Lots 1,
2142, 5845 and 4, petitioner could not have acquired any right whatsoever
over these properties as petitioner still attempted to acquire them
notwithstanding his knowledge of the constitutional prohibition against
foreign ownership of private lands.17 This was made evident by the sworn
statements petitioner executed purporting to show that the subject parcels
of land were purchased from the exclusive funds of his wife, the herein
respondent.18 Petitioner’s plea for reimbursement for the amount he had
paid to purchase the foregoing properties on the basis of equity was likewise
denied for not having come to court with clean hands.
The CA Ruling
Petitioner elevated the matter to the CA, contesting only the RTC’s award of
Lots 1, 2142, 5845 and 4 in favor of respondent. He insisted that the money
used to purchase the foregoing properties came from his own capital funds
and that they were registered in the name of his former wife only because of
the constitutional prohibition against foreign ownership. Thus, he prayed for
reimbursement of one-half (1/2) of the value of what he had paid in the
purchase of the said properties, waiving the other half in favor of his
estranged ex-wife.19
On October 8, 2009, the CA promulgated a Decision20 affirming in toto the
judgment rendered by the RTC of Negros Oriental, Branch 34. The CA
stressed the fact that petitioner was "well-aware of the constitutional
prohibition for aliens to acquire lands in the Philippines."21 Hence, he cannot
invoke equity to support his claim for reimbursement.
Consequently, petitioner filed the instant Petition for Review on Certiorari
assailing the CA Decision due to the following error:
UNDER THE FACTS ESTABLISHED, THE COURT ERRED IN NOT SUSTAINING THE
PETITIONER’S ATTEMPT AT SUBSEQUENTLY ASSERTING OR CLAIMING A
RIGHT OF HALF OR WHOLE OF THE PURCHASE PRICE USED IN THE PURCHASE
OF THE REAL PROPERTIES SUBJECT OF THIS CASE.22 (Emphasis supplied)
The Ruling of the Court
The petition lacks merit.
The issue to be resolved is not of first impression. In In Re: Petition For
Separation of Property-Elena Buenaventura Muller v. Helmut Muller23 the
Court had already denied a claim for reimbursement of the value of
purchased parcels of Philippine land instituted by a foreigner Helmut Muller,
against his former Filipina spouse, Elena Buenaventura Muller. It held that
Helmut Muller cannot seek reimbursement on the ground of equity where it
is clear that he willingly and knowingly bought the property despite the
prohibition against foreign ownership of Philippine land24 enshrined under
Section 7, Article XII of the 1987 Philippine Constitution which reads:
Section 7. Save in cases of hereditary succession, no private lands shall be
transferred or conveyed except to individuals, corporations, or associations
qualified to acquire or hold lands of the public domain.
Undeniably, petitioner openly admitted that he "is well aware of the above-
cited constitutional prohibition"25 and even asseverated that, because of such
prohibition, he and respondent registered the subject properties in the
latter’s name.26 Clearly, petitioner’s actuations showed his palpable intent to
skirt the constitutional prohibition. On the basis of such admission, the Court
finds no reason why it should not apply the Muller ruling and accordingly,
deny petitioner’s claim for reimbursement.
As also explained in Muller, the time-honored principle is that he who seeks
equity must do equity, and he who comes into equity must come with clean
hands. Conversely stated, he who has done inequity shall not be accorded
equity. Thus, a litigant may be denied relief by a court of equity on the
ground that his conduct has been inequitable, unfair and dishonest, or
fraudulent, or deceitful.27
party to an illegal contract or agreement; it leaves the parties where it finds
them.32 Indeed, one cannot salvage any rights from an unconstitutional
transaction knowingly entered into.
Neither can the Court grant petitioner’s claim for reimbursement on the
basis of unjust enrichment.33 As held in Frenzel v. Catito, a case also involving
a foreigner seeking monetary reimbursement for money spent on purchase
of Philippine land, the provision on unjust enrichment does not apply if the
action is proscribed by the Constitution, to wit:
Futile, too, is petitioner's reliance on Article 22 of the New Civil Code which
reads:
Art. 22. Every person who through an act of performance by another, or any
other means, acquires or comes into possession of something at the expense
of the latter without just or legal ground, shall return the same to
him.1âwphi1
The provision is expressed in the maxim: "MEMO CUM ALTERIUS DETER
DETREMENTO PROTEST" (No person should unjustly enrich himself at the
expense of another). An action for recovery of what has been paid without
just cause has been designated as an accion in rem verso. This provision does
not apply if, as in this case, the action is proscribed by the Constitution or by
the application of the pari delicto doctrine. It may be unfair and unjust to bar
the petitioner from filing an accion in rem verso over the subject properties,
or from recovering the money he paid for the said properties, but, as Lord
Mansfield stated in the early case of Holman v. Johnson: "The objection that
a contract is immoral or illegal as between the plaintiff and the defendant,
sounds at all times very ill in the mouth of the defendant. It is not for his
sake, however, that the objection is ever allowed; but it is founded in general
principles of policy, which the defendant has the advantage of, contrary to
the real justice, as between him and the plaintiff."34 (Citations omitted)
Nor would the denial of his claim amount to an injustice based on his foreign
citizenship.35 Precisely, it is the Constitution itself which demarcates the
rights of citizens and non-citizens in owning Philippine land. To be sure, the
constitutional ban against foreigners applies only to ownership of Philippine
land and not to the improvements built thereon, such as the two (2) houses
standing on Lots 1 and 2142 which were properly declared to be co-owned
by the parties subject to partition. Needless to state, the purpose of the
prohibition is to conserve the national patrimony36 and it is this policy which
the Court is duty-bound to protect.
WHEREFORE, the petition is DENIED. Accordingly, the assailed October 8,
2009 Decision and January 24, 2011 Resolution of the Court of Appeals in CA-
G.R. CV No. 01940 are AFFIRMED.
SO ORDERED.

In this case, petitioner’s statements regarding the real source of the funds
used to purchase the subject parcels of land dilute the veracity of his claims:
While admitting to have previously executed a joint affidavit that
respondent’s personal funds were used to purchase Lot 1,28 he likewise
claimed that his personal disability funds were used to acquire the same.
Evidently, these inconsistencies show his untruthfulness. Thus, as petitioner
has come before the Court with unclean hands, he is now precluded from
seeking any equitable refuge.

In any event, the Court cannot, even on the grounds of equity, grant
reimbursement to petitioner given that he acquired no right whatsoever over
the subject properties by virtue of its unconstitutional purchase. It is well-
established that equity as a rule will follow the law and will not permit that
to be done indirectly which, because of public policy, cannot be done
directly.29 Surely, a contract that violates the Constitution and the law is null
and void, vests no rights, creates no obligations and produces no legal effect G.R. No. L-29663 August 20, 1990
at all.30 Corollary thereto, under Article 1412 of the Civil Code,31 petitioner
cannot have the subject properties deeded to him or allow him to recover GREGORIO LLANTINO and BELINDA LLANTINO assisted by husband
the money he had spent for the purchase thereof. The law will not aid either Napoleon Barba, plaintiffs-appellants,
vs.
CO LIONG CHONG alias JUAN MOLINA, defendant-appellee.
Delfin de Vera for plaintiffs-appellants.
Antonio G. Sosito for defendant-appellee.
PARAS, J.:
This is an appeal perfected before the effectivity of Republic Act 5440, from
the decision * of the Court of First Instance of Catanduanes in Civil Case No.
611, to quiet title with damages, entitled Gregorio Llantino, et al. vs. Cong
Liong Chong alias Juan Molina, dismissing the complaint and declaring that
the contract of lease entered into between the plaintiffs and the defendant
valid and in accordance with law.
The facts of the case as summarized by the trial court are as follows:
Plaintiffs (petitioners herein) aver that they are the owners of a commercial-
residential land situated in the municipality of Virac, Catanduanes, described
in paragraph 2 of the complaint, which sometime in 1954 they leased to the
defendant (private respondent) who was then a Chinese national and went
by the name of Co Liong Chong for a period of thirteen (13) years for the sum
of P6,150.00 for the whole period. The defendant was placed in possession
of the property but knowing that the period of the least would end with the
year 1967, petitioners requested private respondent for a conference but the
latter did not honor the request and instead he informed the petitioners that
he had already constructed a commercial building on the land worth
P50,000.00; that the lease contract was for a period of sixty (60) years,
counted from 1954; and that he is already a Filipino citizen. The claim of
Chong came as a surprise to the Llantinos because they did not remember
having agreed to a sixty-year lease agreement as that would virtually make
Chong the owner of the realty which, as a Chinese national, he had no right
to own and neither could he have acquired such ownership after
naturalization subsequent to 1954. On December 16, 1967, in order to avoid
a court litigation the Llantinos once more invited Chong to a conference
about the matter but again Chong ignored the invitation. (Rollo, p. 48;
Appellant's Brief, p. 12)
Hence, on January 10, 1968, the Llantinos filed their complaint to quiet title
with damages before the Court of First Instance of Catanduanes (Rollo, p. 12;
Record on Appeal, pp. 1-4).
After Chong has filed an answer to the complaint and the Llantinos their
reply, (Rollo, p. 12; Record on Appeal, pp. 9-10) the trial court set the case for
pre-trial and trial for April 2, 1968 (Rollo, p. 12; Record on Appeal, pp. 10-11).
At the pre-trial, both parties agreed upon the identity of the land as
described in the complaint. It was mutually admitted that the defendants
original name was Co Liong Chong who was then a Chinese national in 1954,
when he approached the plaintiffs and offered to lease the land in question.
It was also admitted by the counsel for the defendant that prior to the filing
of the case, the plaintiffs have in fact invited the defendant to a conference
about the matter (Rollo, p. 12; Record on Appeal; p. 14).
Chong's counsel produced the carbon original of the contract of lease
entered into between Chong and the Llantinos and the existence of the
contract of lease as a public instrument was admitted (Rollo, p. 12; Record on
Appeal, pp. 14-15).
It was also admitted that Chong had in fact constructed a building of strong
materials on the land worth P40,000.00 (Rollo, p. 12; Record on Appeal, p.
15); that Chong has become a naturalized Filipino citizen in 1961 and that his
name is no longer Co Liong Chong but Juan Molina (Rollo, p. 12; Record on
Appeal, p. 15).
On May 17, 1968, the trial court rendered a Decision the dispositive portion
of which reads:
WHEREFORE, in view of the foregoing considerations, the Court finds the
contract of lease entered into between the plaintiffs and the defendant on
October 5, 1954, valid and in accordance with law and the complaint is
dismissed with costs against the plaintiffs.
The Court, however, feels that there is no sufficient ground to award moral
damages or attorney's fees as claimed by the defendant because the Court is
fairly convinced that the institution of the suit sprung from an honest
conviction on the part of the plaintiffs that on account of the period fixed in
the contract of lease and the fact that the defendant was a Chinese national
at the time of its celebration constituted valid grounds for annulment.
SO ORDERED. (Rollo, p. 12; Record on Appeal, p. 24).
From this judgment, plaintiffs appealed directly to this Court on a pure
question of law (Rollo, p. 12; Record on Appeal, pp. 24-25).
The plaintiffs-appellants filed their brief on May 26, 1969 (Rollo, p. 48). The
defendant-appellee filed his corresponding brief on July 22, 1969 (Rollo, p.
59).
The appellants raised the following assignment of errors:
I
THE LOWER COURT ERRED IN DECLARING THE CONTRACT ENTERED INTO BY
AND BETWEEN THE APPELLANTS AND THE DEFENDANTS ON OCTOBER 5,
1954 VALID.
II
THE LOWER COURT ERRED IN REFUSING TO DECLARE THAT CONTRACT NOT A
LEASE.
Stripping the case of irrelevant allegations, the pivotal issue in this case is
whether or not the contract of lease entered into by and between the
petitioners including Virgilio Llantino now deceased and private respondent
on October 5, 1954 for a period of sixty (60) years is valid.
Petitioners contend that when the contract which is sought to be declared
void was entered into by and between the parties, private respondent was
still a Chinese national (Rollo, p. 48; Appellants' Brief, p. 2). However,
petitioners also stated that they do not dispute the right of private
respondent to hold the landholding in dispute under a contract of lease but
they cannot fathom how Congress could have thought of a lease contract
which shall be for an indefinite period and yet say that the period to be valid
should not exceed 99 years (Rollo, p. 48; Appellant's Brief, p. 4; Article 1643
of the New Civil Code of the Philippines).
On the other hand, private respondent argued that even though he was still
an alien when he entered into the contract of lease (on October 5, 1954), he
was not prohibited by law to do so. In fact, prior to his becoming a
naturalized Filipino citizen in 1961, the appellants did not question his right
to enter into that contract so that the parties are in pari delicto. He
constructed a building on the property worth P40,000.00 and prays that he
be awarded P30,000.00 for moral damages and P2,000.00 for Attorney's
fees. (Rollo, p. 48; Appellant's Brief, p. 2).
The position of private respondent is well taken.
The lower court correctly ruled that the defendant-appellee Chong had at
the time of the execution of the contract, the right to hold by lease the
property involved in the case although at the time of the execution of the
contract, he was still a Chinese national (Rollo, p. 59; Appellee's Brief, pp. 10-
11).
In the present case, it has been established that there is only one contract
and there is no option to buy the leased property in favor of Chong. There is
nothing in the record, either in the lease contract or in the complaint itself,
to indicate any scheme to circumvent the constitutional prohibition. On the
contrary, the Llantinos themselves admit openly that right from the start and
before entering into the contract, Chong had merely asked them for a lease
of the premises to which they agreed. Admittedly under the terms of the
contract there is nothing to prevent the Llantinos from disposing of their title
to the land to any qualified party but subject to the rights of the lessee
Chong. Neither is there under the terms of the said contract to indicate that
the ownership of the Llantinos of the leased premises has been virtually
transferred to the lessee (Rollo, p. 59; Appellee's Brief, p. 14).

Under the circumstances, a lease to an alien for a reasonable period is valid.

So is an option giving an alien the right to buy real property on condition that
he is granted Philippine citizenship. Aliens are not completely excluded by
the Constitution from use of lands for residential purposes. Since their
residence in the Philippines is temporary, they may be granted temporary
rights such as a lease contract which is not forbidden by the Constitution.
Should they desire to remain here forever and share our fortune and
misfortune, Filipino citizenship is not impossible to acquire (Philippine
Banking Corporation vs. Lui She, 21 SCRA 52 [1967], citing Krivenko vs.
Register of Deeds, 79 Phil. 461 [1947]).

The only instance where a contract of lease may be considered invalid is, if
there are circumstances attendant to its execution, which are used as a
scheme to circumvent the constitutional prohibition.

If an alien is given not only a lease of, but also an option to buy, a piece of
land, by virtue of which the Filipino owner cannot sell or otherwise dispose
of his property, this to last for 50 years, then it becomes clear that the
arrangement is a virtual transfer of ownership whereby the owner divests
himself in stages not only of the right to enjoy the land (jus possidendi, jus
utendi, jus fruendi, and jus abutendi) — rights, the sum of which make up
ownership. It is just as if today the possession is transferred, tomorrow the
use, the next day the disposition, and so on, until ultimately all the rights of
which ownership is made up are consolidated in an alien (Philippine Banking
Corporation vs. Lui She, 21 SCRA 52 [1967]).

Coming back to the case at bar, even assuming, arguendo, that the subject
contract is prohibited, the same can no longer be questioned presently upon
the acquisition by the private respondent of Filipino citizenship. It was held
that sale of a residential land to an alien which is now in the hands of a
naturalized Filipino citizen is valid (De Castro vs. Tan, 129 SCRA 85 [1984]).

A contract is the law between the contracting parties, and when there is
nothing in it which is contrary to law, morals, good customs, public policy or
public order, the validity of the contract must be sustained (Marimperio
Compania Naviera, S.A. vs. Court of Appeals, 156 SCRA 358 [1987]).

The issue of the nature of the contract in the case at bar was never raised in
the basic pleadings or in the pre-trial (Rollo, p. 59-1; Appellee's Brief, p. 22).

It is too late to raise an issue on appeal in the Supreme Court when it has not
been raised in the lower court (Espadera vs. Court of Appeals, 165 SCRA 364
[1988]).

Moreover, contracts which are not ambiguous are to be interpreted

according to their literal meaning and should not be interpreted beyond their
obvious intendment (Plastic Town Center Corporation vs. NLRC, 172 SCRA
580 [1989]; Herrera vs. Petrophil Corp., 146 SCRA 385 [1986]).

PREMISES CONSIDERED, the decision appealed from is hereby AFFIRMED

with costs against the plaintiffs-appellants.

SO ORDERED

[G.R. No. 151212. September 10, 2003.]

TEN FORTY REALTY AND DEVELOPMENT CORP., Represented by its

President, VERONICA G. LORENZANA, Petitioner, v. MARINA
CRUZ, Respondent.
DECISION
PANGANIBAN, J.:
In an ejectment suit, the question of ownership may be provisionally ruled
upon for the sole purpose of determining who is entitled to possession de
facto. In the present case, both parties base their alleged right to possess on
their right to own. Hence, the Court of Appeals did not err in passing upon
the question of ownership to be able to decide who was entitled to physical
possession of the disputed land.chanrob1es virtua1 1aw 1ibrary
The Case
Before us is a Petition for Review 1 under Rule 45 of the Rules of Court,
seeking to nullify the August 31, 2001 Decision 2 and December 19, 2001
Resolution 3 of the Court of Appeals (CA) in CA-G.R. SP No. 64861. The
dispositive portion of the assailed Decision is as
follows:jgc:chanrobles.com.ph
"WHEREFORE, premises considered, the petition is hereby DISMISSED and
the Decision dated May 4, 2001 is hereby AFFIRMED." 4
The assailed Resolution denied petitioner’s Motion for Reconsideration.
The Facts
The facts of the case are narrated by the CA as follows:jgc:chanrobles.com.ph
"A complaint for ejectment was filed by [Petitioner Ten Forty Realty and
Development Corporation] against . . . [Respondent Marina Cruz] before the
Municipal Trial Court in Cities (MTCC) of Olongapo City, docketed as Civil
Case 4269, which alleged that: petitioner is the true and absolute owner of a
parcel of lot and residential house situated in #71 18th Street, E.B.B.
Olongapo City, particularly described as:chanrob1es virtual 1aw library
‘A parcel of residential house and lot situated in the above-mentioned
address containing an area of 324 square meters more or less bounded on
the Northeast by 041 (Lot 255, Ts-308); on the Southeast by 044 (Lot 255, Ts-
308); on the Southwest by 043 (Lot 226-A & 18th street) and on the
Northwest by 045 (Lot 227, Ts-308) and declared for taxation purposes in the
name of [petitioner] under T.D. No. 002-4595-R and 002-4596.chanrob1es
virtua1 1aw 1ibrary
having acquired the same on December 5, 1996 from Barbara Galino by
virtue of a Deed of Absolute Sale; the sale was acknowledged by said Barbara
Galino through a ‘Katunayan’; payment of the capital gains tax for the
transfer of the property was evidenced by a Certification Authorizing
Registration issued by the Bureau of Internal Revenue; petitioner came to
know that Barbara Galino sold the same property on April 24, 1998 to Cruz,
who immediately occupied the property and which occupation was merely
tolerated by petitioner; on October 16, 1998, a complaint for ejectment was
filed with the Barangay East Bajac-Bajac, Olongapo City but for failure to
arrive at an amicable settlement, a Certificate to File Action was issued; on
April 12, 1999 a demand letter was sent to [respondent] to vacate and pay
reasonable amount for the use and occupation of the same, but was ignored
by the latter; and due to the refusal of [respondent] to vacate the premises,
petitioner was constrained to secure the services of a counsel for an agreed
fee of P5,000.00 as attorney’s fee and P500.00 as appearance fee and
incurred an expense of P5,000.00 for litigation.
"In respondent’s Answer with Counterclaim, it was alleged that: petitioner is
not qualified to own the residential lot in dispute, being a public land;
according to Barbara Galino, she did not sell her house and lot to petitioner
but merely obtained a loan from Veronica Lorenzana; the payment of the
capital gains tax does not necessarily show that the Deed of Absolute Sale
was at that time already in existence; the court has no jurisdiction over the
subject matter because the complaint was filed beyond the one (1) year
period after the alleged unlawful deprivation of possession; there is no
allegation that petitioner had been in prior possession of the premises and
the same was lost thru force, stealth or violence; evidence will show that it
was Barbara Galino who was in possession at the time of the sale and
vacated the property in favor of respondent; never was there an occasion
when petitioner occupied a portion of the premises, before respondent
occupied the lot in April 1998, she caused the cancellation of the tax
declaration in the name of Barbara Galino and a new one issued in
respondent’s name; petitioner obtained its tax declaration over the same
property on November 3, 1998, seven (7) months [after] the respondent
[obtained hers]; at the time the house and lot [were] bought by respondent,
the house was not habitable, the power and water connections were
disconnected; being a public land, respondent filed a miscellaneous sales
application with the Community Environment and Natural Resources Office
in Olongapo City; and the action for ejectment cannot succeed where it
appears that respondent had been in possession of the property prior to the
petitioner." 5
In a Decision 6 dated October 30, 2000, the Municipal Trial Court in Cities
(MTCC) ordered respondent to vacate the property and surrender to
petitioner possession thereof. It also directed her to pay, as damages for its
continued unlawful use, P500 a month from April 24, 1999 until the property
was vacated, P5,000 as attorney’s fees, and the costs of the suit.
On appeal, the Regional Trial Court 7 (RTC) of Olongapo City (Branch 72)
reversed the MTCC. The RTC ruled as follows: 1) respondents entry into the
property was not by mere tolerance of petitioner, but by virtue of a Waiver
and Transfer of Possessory Rights and Deed of Sale in her favor; 2) the
execution of the Deed of Sale without actual transfer of the physical
possession did not have the effect of making petitioner the owner of the
property, because there was no delivery of the object of the sale as provided
for in Article 1438 of the Civil Code; and 3) being a corporation, petitioner
was disqualified from acquiring the property, which was public land.
Ruling of the Court of Appeals
Sustaining the RTC, the CA held that petitioner had failed to make a case for
unlawful detainer, because no contract — express or implied — had been
entered into by the parties with regard to possession of the property. It ruled
that the action should have been for forcible entry, in which prior physical
possession was indispensable — a circumstance petitioner had not shown
either.
The appellate court also held that petitioner had challenged the RTC’s ruling
on the question of ownership for the purpose of compensating for the
latter’s failure to counter such ruling. The RTC had held that, as a
corporation, petitioner had no right to acquire the property which was
alienable public land.
Hence, this Petition. 8
Issues
Petitioner submits the following issues for our
consideration:jgc:chanrobles.com.ph
"1. The Honorable Court of Appeals had clearly erred in not holding that
[r]espondent’s occupation or possession of the property in question was
merely through the tolerance or permission of the herein [p]etitioner;
permitted or tolerated the occupation of the property by Respondent Cruz.
The Complaint contains only bare allegations that 1) respondent immediately
occupied the subject property after its sale to her, an action merely tolerated
by petitioner; 15 and 2) her allegedly illegal occupation of the premises was
by mere tolerance. 16

" [2.] The Honorable Court of Appeals had likewise erred in holding that the
ejectment case should have been a forcible entry case where prior physical
possession is indispensable; and
" [3.] The Honorable Court of Appeals had also erred when it ruled that the
herein [r]espondent’s possession or occupation of the said property is in the
nature of an exercise of ownership which should put the herein [p]etitioner
on guard." 9
The Court’s Ruling
The Petition has no merit.
First Issue:chanrob1es virtual 1aw library
These allegations contradict, rather than support, petitioner’s theory that its
cause of action is for unlawful detainer. First, these arguments advance the
view that respondent’s occupation of the property was unlawful at its
inception. Second, they counter the essential requirement in unlawful
detainer cases that petitioner’s supposed act of sufferance or tolerance must
be present right from the start of a possession that is later sought to be
recovered. 17
As the bare allegation of petitioner’s tolerance of respondent’s occupation of
the premises has not been proven, the possession should be deemed illegal
from the beginning. Thus, the CA correctly ruled that the ejectment case
should have been for forcible entry — an action that had already prescribed,
however, when the Complaint was filed on May 12, 1999. The prescriptive
period of one year for forcible entry cases is reckoned from the date of
respondent’s actual entry into the land, which in this case was on April 24,
1998.

Alleged Occupation by Tolerance

Second Issue:chanrob1es virtual 1aw library

Petitioner faults the CA for not holding that the former merely tolerated
Nature of the Case
respondent’s occupation of the subject property. By raising this issue,
petitioner is in effect asking this Court to reassess factual findings. As a
Much of the difficulty in the present controversy stems from the legal
general rule, this kind of reassessment cannot be done through a petition for
characterization of the ejectment Complaint filed by petitioner. Specifically,
review on certiorari under Rule 45 of the Rules of Court, because this Court is
was it for unlawful detainer or for forcible entry?
not a trier of facts; it reviews only questions of law. 10 Petitioner has not
given us ample reasons to depart from the general rule.
The answer is given in Section 1 of Rule 70 of the Rules of Court, which we
reproduce as follows:jgc:chanrobles.com.ph
On the basis of the facts found by the CA and the RTC, we find that petitioner
failed to substantiate its case for unlawful detainer. Admittedly, no express
"SECTION 1. Who may institute proceedings, and when. — Subject to the
contract existed between the parties. Not shown either was the
provisions of the next succeeding section, a person deprived of the
corporation’s alleged tolerance of respondent’s possession.chanrob1es
possession of any land or building by force, intimidation, threat, strategy, or
virtua1 1aw 1ibrary
stealth, or a vendor, vendee, or other person against whom the possession of
any land or building is unlawfully withheld after expiration or termination of
While possession by tolerance may initially be lawful, it ceases to be so upon
the right to hold possession, by virtue of any contract, express or implied, or
the owner’s demand that the possessor by tolerance vacate the property. 11
the legal representatives or assigns of any such lessor, vendor, vendee, or
To justify an action for unlawful detainer, the permission or tolerance must
other person, may, at any time within one (1) year after such unlawful
have been present at the beginning of the possession. 12 Otherwise, if the
deprivation or withholding of possession, bring an action in the proper
possession was unlawful from the start, an action for unlawful detainer
Municipal Trial Court against the person or persons unlawfully withholding or
would be an improper remedy. Sarona v. Villegas 13 elucidates
depriving of possession, or any person or persons claiming under them, for
thus:jgc:chanrobles.com.ph
the restitution of such possession, together with damages and costs.’’

"A close assessment of the law and the concept of the word ‘tolerance’
While both causes of action deal only with the sole issue of physical or de
confirms our view heretofore expressed that such tolerance must be present
facto possession, 18 the two cases are really separate and distinct, as
right from the start of possession sought to be recovered, to categorize a
explained below:jgc:chanrobles.com.ph
cause of as one of unlawful detainer not of forcible entry. Indeed, to hold
otherwise would espouse a dangerous doctrine. And for two reasons. First.
". . . . In forcible entry, one is deprived of physical possession of land or
Forcible entry into the land is an open challenge to the right of the possessor.
building by means of force, intimidation, threat, strategy, or stealth. In
Violation of that right authorizes the speedy redress — in the inferior court
unlawful detainer, one unlawfully withholds possession thereof after the
— provided for in the rules. If one year from the forcible entry is allowed to
expiration or termination of his right to hold possession under any contract,
lapse before suit is filed, then the remedy ceases to be speedy; and the
express or implied. In forcible entry, the possession is illegal from the
possessor is deemed to have waived his right to seek relief in the inferior
beginning and the basic inquiry centers on who has the prior possession de
court. Second, if a forcible entry action in the inferior court is allowed after
facto. In unlawful detainer, the possession was originally lawful but became
the lapse of a number of years, then the result may well be that no action for
unlawful by the expiration or termination of the right to possess, hence the
forcible entry can really prescribe. No matter how long such defendant is in
issue of rightful possession is decisive for, in such action, the defendant is in
physical possession, plaintiff will merely make a demand, bring suit in the
actual possession and the plaintiff’s cause of action is the termination of the
inferior court — upon a plea of tolerance to prevent prescription to set in —
defendant’s right to continue in possession.
and summarily throw him out of the land. Such a conclusion is unreasonable.
Especially if we bear in mind the postulates that proceedings of forcible entry
"What determines the cause of action is the nature of defendant’s entry into
and unlawful detainer are summary in nature, and that the one year time bar
the land. If the entry is illegal, then the action which may be filed against the
to suit is but in pursuance of the summary nature of the action." 14
intruder within one year therefrom is forcible entry. If, on the other hand,
the entry is legal but the possession thereafter became illegal, the case is one
In this case, the Complaint and the other pleadings do not recite any,
of unlawful detainer which must be filed within one year from the date of the
averment of fact that would substantiate the claim of petitioner that it
last demand." 19
It is axiomatic that what determines the nature of an action as well as which
court has jurisdiction over it are the allegations in the complaint 20 and the
character of the relief sought. 21
In its Complaint, petitioner alleged that, having acquired the subject property
from Barbara Galino on December 5 1996, 22 it was the true and absolute
owner 23 thereof; that Galino had sold the property to Respondent Cruz on
April 24, 1998; 24 that after the sale, the latter immediately occupied the
property, an action that was merely tolerated by petitioner; 25 and that, in a
letter given to respondent on April 12, 1999, 26 petitioner had demanded
that the former vacate the property, but that she refused to do so. 27
Petitioner thereupon prayed for judgment ordering her to vacate the
property and to pay reasonable rentals for the use of the premises,
attorney’s fees and the costs of the suit. 28
The above allegations appeared to show the elements of unlawful detainer.
They also conferred initiatory jurisdiction on the MTCC, because the case was
filed a month after the last demand to vacate — hence, within the one-year
prescriptive period.
However, what was actually proven by petitioner was that possession by
respondent had been illegal from the beginning. While the Complaint was
crafted to be an unlawful detainer suit, petitioner’s real cause of action was
for forcible entry, which had already prescribed. Consequently, the MTCC
had no more jurisdiction over the action.
The appellate court, therefore, did not err when it ruled that petitioner’s
Complaint for unlawful detainer was a mere subterfuge or a disguised
substitute action for forcible entry, which had already prescribed. To repeat,
to maintain a viable action for forcible entry, plaintiff must have been in prior
physical possession of the property; this is an essential element of the suit.
29
Third Issue:chanrob1es virtual 1aw library
Alleged Acts of Ownership
Petitioner next questions the CA’s pronouncement that respondent’s
occupation of the property was an exercise of a right flowing from a claim of
ownership. It submits that the appellate court should not have passed upon
the issue of ownership, because the only question for resolution in an
ejectment suit is that of possession de facto.
Clearly, each of the parties claimed the right to possess the disputed
property because of alleged ownership of it. Hence, no error could have been
imputed to the appellate court when it passed upon the issue of ownership
only for the purpose of resolving the issue of possession de facto. 30 The
CA’s holding is moreover in accord with jurisprudence and the law.
Execution of a Deed of Sale Not Sufficient as Delivery
In a contract of sale, the buyer acquires the thing sold only upon its delivery
"in any of the ways specified in Articles 1497 to 1501, or any other manner
signifying an agreement that the possession is transferred from the vendor to
the vendee." 31 With respect to incorporeal property, Article 1498 lays down
the general rule: the execution of a public instrument shall be equivalent to
the delivery of the thing that is the object of the contract if, from the deed,
the contrary does not appear or cannot be clearly inferred.chanrob1es
virtua1 1aw 1ibrary
However, ownership is transferred not by contract but by tradition or
delivery. 32 Nowhere in the Civil Code is it provided that the execution of a
Deed of Sale is a conclusive presumption of delivery of possession of a piece
of real estate. 33
This Court has held that the execution of a public instrument gives rises only
to a prima facie presumption of delivery. Such presumption is destroyed
when the delivery is not effected because of a legal impediment. 34 Pasagui
v. Villablanca 35 had earlier ruled that such constructive or symbolic delivery,
being merely presumptive, was deemed negated by the failure of the vendee
to take actual possession of the land sold.
It is undisputed that petitioner did not occupy the property from the time it
was allegedly sold to it on December 5, 1996 or at any time thereafter.
Nonetheless, it maintains that Galino’s continued stay in the premises from
the time of the sale up to the time respondent’s occupation of the same on
April 24, 1998, was possessions held on its behalf and had the effect of
delivery under the law. 36
Both the RTC and the CA disagreed. According to the RTC, petitioner did not
gain control and possession of the property, because Galino had continued to
exercise ownership rights over the realty. That is, she had remained in
possession, continued to declare it as her property for tax purposes and sold
it to respondent in 1998.
For its part, the CA found it highly unbelievable that petitioner — which
claims to be the owner of the disputed property — would tolerate possession
of the property by respondent from April 24, 1998 up to October 16, 1998.
How could it have been so tolerant despite its knowledge that the property
had been sold to her, and that it was by virtue of that sale that she had
undertaken major repairs and improvements on it?
Petitioner should have likewise been put on guard by respondent’s
declaration of the property for tax purposes on April 23, 1998, 37 as
annotated in the tax certificate filed seven months later. 38 Verily, the tax
declaration represented an adverse claim over the unregistered property and
was inimical to the right of petitioner.
Indeed, the above circumstances derogated its claim of control and
possession of the property.
Order of Preference in Double Sale of Immovable Property
The ownership of immovable property sold to two different buyers at
different times is governed by Article 1544 of the Civil Code, which reads as
follows:jgc:chanrobles.com.ph
"Article 1544. . . .
"Should it be immovable property, the ownership shall belong to the person
acquiring it who in good faith first recorded it in the Registry of Property.
"Should there be no inscription, the ownership shall pertain to the person
who in good faith was first in possession; and, in the absence thereof, to the
person who presents the oldest title, provided there is good faith."cralaw
virtua1aw library
Galino allegedly sold the property in question to petitioner on December 5,
1996 and, subsequently, to respondent on April 24, 1998. Petitioner thus
argues that being the first buyer, it has a better right to own the realty.
However, it has not been able to establish that its Deed of Sale was recorded
in the Registry of Deeds of Olongapo City. 39 Its claim of an unattested and
unverified notation on its Deed of Absolute Sale 40 is not equivalent to
registration. It admits that, indeed, the sale has not been recorded in the
Registry of Deeds. 41
In the absence of the required inscription, the law gives preferential right to
the buyer who in good faith is first in possession. In determining the question
of who is first in possession, certain basic parameters have been established
by jurisprudence.
First, the possession mentioned in Article 1544 includes not only material but
also symbolic possession. 42 Second, possessors in good faith are those who
are not aware of any flaw in their title or mode of acquisition. 43 Third,
buyers of real property that is in the possession of persons other than the
seller must be wary — they must investigate the rights of the possessors. 44
Fourth, good faith is always presumed; upon those who allege bad faith on
the part of the possessors rests the burden of proof. 45

Earlier, we ruled that the subject property had not been delivered to
petitioner; hence, it did not acquire possession either materially or
symbolically. As between the two buyers, therefore, respondent was first in
actual possession of the property.

Petitioner has not proven that respondent was aware that her mode of
acquiring the property was defective at the time she acquired it from Galino.
At the time, the property — which was public land — had not been
registered in the name of Galino; thus, respondent relied on the tax
declarations thereon. As shown, the former’s name appeared on the tax
declarations for the property until its sale to the latter in 1998. Galino was in
fact occupying the realty when respondent took over possession. Thus, there
was no circumstance that could have placed the latter upon inquiry or
required her to further investigate petitioner’s right of ownership.

Disqualification from Ownership of Alienable Public Land

Private corporations are disqualified from acquiring lands of the public

domain, as provided under Section 3 of Article XII of the Constitution, which
we quote:jgc:chanrobles.com.ph

"Sec. 3. Lands of the public domain are classified into agricultural, forest or
timber, mineral lands, and national parks. Agricultural lands of the public
domain may be further classified by law according to the uses to which they
may be devoted. Alienable lands of the public domain shall be limited to
agricultural lands. Private corporations or associations may not hold such
alienable lands of the public domain except by lease, for a period not
exceeding twenty-five years, and not to exceed one thousand hectares in
area. Citizens of the Philippines may not lease not more than five hundred
hectares, or acquire not more than twelve hectares thereof by purchase,
homestead, or grant. . . . ." (Emphasis supplied)

While corporations cannot acquire land of the public domain, they can
however acquire private land. 46 Hence, the next issue that needs to be
resolved is the determination of whether the disputed property is private
land or of the public domain.

According to the certification by the City Planning and Development Office of

Olongapo City, the contested property in this case is alienable and disposable
public land. 47 It was for this reason that respondent filed a miscellaneous
sales application to acquire it. 48

On the other hand, petitioner has not presented proof that, at the time it
purchased the property from Galino, the property had ceased to be of the
public domain and was already private land. The established rule is that
alienable and disposable land of the public domain held and occupied by a
possessor — personally or through predecessors-in-interest, openly,
continuously, and exclusively for 30 years — is ipso jure converted to private
property by the mere lapse of time. 49

In view of the foregoing, we affirm the appellate court’s ruling that

respondent is entitled to possession de facto. This determination, however,
is only provisional in nature. 50 Well-settled is the rule that an award of
possession de facto over a piece of property does not constitute res judicata
as to the issue of its ownership. 51

WHEREFORE, this Petition is DENIED and the assailed Decision AFFIRMED.

Costs against petitioner.chanrob1es virtua1 1aw 1ibrary G.R. No. 73002 December 29, 1986

THE DIRECTOR OF LANDS, petitioner,

SO ORDERED.
vs.
INTERMEDIATE APPELLATE COURT and ACME PLYWOOD & VENEER CO.
INC., ETC., respondents.
D. Nacion Law Office for private respondent.
NARVASA, J.:
The Director of Lands has brought this appeal by certiorari from a judgment
of the Intermediate Appellate Court affirming a decision of the Court of First
Instance of Isabela, which ordered registration in favor of Acme Plywood &
Veneer Co., Inc. of five parcels of land measuring 481, 390 square meters,
more or less, acquired by it from Mariano and Acer Infiel, members of the
Dumagat tribe.
The registration proceedings were for confirmation of title under Section 48
of Commonwealth Act No. 141 (The Public Land Act). as amended: and the
appealed judgment sums up the findings of the trial court in said proceedings
in this wise:
1. That Acme Plywood & Veneer Co. Inc., represented by Mr. Rodolfo Nazario
is a corporation duly organized in accordance with the laws of the Republic of
the Philippines and registered with the Securities and Exchange Commission
on December 23, 1959;
2. That Acme Plywood & Veneer Co. Inc., represented by Mr. Rodolfo Nazario
can acquire real properties pursuant to the provisions of the Articles of
Incorporation particularly on the provision of its secondary purposes
(paragraph (9), Exhibit 'M-l');
3. That the land subject of the Land Registration proceeding was ancestrally
acquired by Acme Plywood & Veneer Co., Inc., on October 29, 1962, from
Mariano Infiel and Acer Infiel, both members of the Dumagat tribe and as
such are cultural minorities;
4. That the constitution of the Republic of the Philippines of 1935 is
applicable as the sale took place on October 29, 1962;
5. That the possession of the Infiels over the land relinquished or sold to
Acme Plywood & Veneer Co., Inc., dates back before the Philippines was
discovered by Magellan as the ancestors of the Infiels have possessed and
occupied the land from generation to generation until the same came into
the possession of Mariano Infiel and Acer Infiel;
6. That the possession of the applicant Acme Plywood & Veneer Co., Inc., is
continuous, adverse and public from 1962 to the present and tacking the
possession of the Infiels who were granted from whom the applicant bought
said land on October 29, 1962, hence the possession is already considered
from time immemorial.
7. That the land sought to be registered is a private land pursuant to the
provisions of Republic Act No. 3872 granting absolute ownership to members
of the non-Christian Tribes on land occupied by them or their ancestral lands,
whether with the alienable or disposable public land or within the public
domain;
8. That applicant Acme Plywood & Veneer Co. Inc., has introduced more than
Forty-Five Million (P45,000,000.00) Pesos worth of improvements, said
improvements were seen by the Court during its ocular investigation of the
land sought to be registered on September 18, 1982;
9. That the ownership and possession of the land sought to be registered by
the applicant was duly recognized by the government when the Municipal
Officials of Maconacon, Isabela, have negotiated for the donation of the
townsite from Acme Plywood & Veneer Co., Inc., and this negotiation came
to reality when the Board of Directors of the Acme Plywood & Veneer Co.,
Inc., had donated a part of the land bought by the Company from the Infiels
for the townsite of Maconacon Isabela (Exh. 'N') on November 15, 1979, and
which donation was accepted by the Municipal Government of Maconacon,
Isabela (Exh. 'N-l'), during their special session on November 22, 1979.
The Director of Lands takes no issue with any of these findings except as to
the applicability of the 1935 Constitution to the matter at hand. Concerning
this, he asserts that, the registration proceedings have been commenced
only on July 17, 1981, or long after the 1973 Constitution had gone into
effect, the latter is the correctly applicable law; and since section 11 of its
Article XIV prohibits private corporations or associations from holding
alienable lands of the public domain, except by lease not to exceed 1,000
hectares (a prohibition not found in the 1935 Constitution which was in force
in 1962 when Acme purchased the lands in question from the Infiels), it was
reversible error to decree registration in favor of Acme Section 48,
paragraphs (b) and (c), of Commonwealth Act No. 141, as amended, reads:
SEC. 48. The following described citizens of the Philippines, occupying lands
of the public domain or claiming to own any such lands or an interest
therein, but whose titles have not been perfected or completed, may apply
to the Court of First Instance of the province where the land is located for
confirmation of their claims, and the issuance of a certificate of title therefor,
under the Land Registration Act, to wit:
xxx xxx xxx
(b) Those who by themselves or through their predecessors-in-interest have
been in open, continuous, exclusive and notorious possession and
occupation of agricultural lands of the public domain, under a bona fide claim
of acquisition or ownership, for at least thirty years immediately preceding
the filing of the application for confirmation of title except when prevented
by war or force majeure. These shall be conclusively presumed to have
performed all the conditions essential to a Government grant and shall be
entitled to a certificate of title under the provisions of this chapter.
(c) Members of the National Cultural minorities who by themselves or
through their predecessors-in-interest have been in open. continuous,
exclusive and notorious possession and occupation of lands of the public
domain suitable to agriculture, whether disposable or not, under a bona fide
claim of ownership for at least 30 years shall be entitled to the rights granted
in subsection (b) hereof.
The Petition for Review does not dispute-indeed, in view of the quoted
findings of the trial court which were cited and affirmed by the Intermediate
Appellate Court, it can no longer controvert before this Court-the fact that
Mariano and Acer Infiel, from whom Acme purchased the lands in question
on October 29, 1962, are members of the national cultural minorities who
had, by themselves and through their progenitors, possessed and occupied
those lands since time immemorial, or for more than the required 30-year
period and were, by reason thereof, entitled to exercise the right granted in
Section 48 of the Public Land Act to have their title judicially confirmed. Nor
is there any pretension that Acme, as the successor-in-interest of the Infiels,
is disqualified to acquire and register ownership of said lands under any
provisions of the 1973 Constitution other than Section 11 of its Article XIV
already referred to.
Given the foregoing, the question before this Court is whether or not the title
that the Infiels had transferred to Acme in 1962 could be confirmed in favor
of the latter in proceedings instituted by it in 1981 when the 1973
Constitution was already in effect, having in mind the prohibition therein
against private corporations holding lands of the public domain except in
lease not exceeding 1,000 hectares.
The question turns upon a determination of the character of the lands at the
time of institution of the registration proceedings in 1981. If they were then
still part of the public domain, it must be answered in the negative. If, on the
other hand, they were then already private lands, the constitutional
prohibition against their acquisition by private corporations or associations
obviously does not apply.
In this regard, attention has been invited to Manila Electric Company vs.
Castro-Bartolome, et al, 1 where a similar set of facts prevailed. In that case,
Manila Electric Company, a domestic corporation more than 60% of the
capital stock of which is Filipino-owned, had purchased in 1947 two lots in
Tanay, Rizal from the Piguing spouses. The lots had been possessed by the
vendors and, before them, by their predecessor-in-interest, Olimpia Ramos,
since prior to the outbreak of the Pacific War in 1941. On December 1, 1976,
Meralco applied to the Court of First Instance of Rizal, Makati Branch, for
confirmation of title to said lots. The court, assuming that the lots were
public land, dismissed the application on the ground that Meralco, a juridical
person, was not qualified to apply for registration under Section 48(b) of the
Public Land Act which allows only Filipino citizens or natural persons to apply
for judicial confirmation of imperfect titles to public land. Meralco appealed,
and a majority of this Court upheld the dismissal. It was held that:
..., the said land is still public land. It would cease to be public land only upon
the issuance of the certificate of title to any Filipino citizen claiming it under
section 48(b). Because it is still public land and the Meralco, as a juridical
person, is disqualified to apply for its registration under section 48(b),
Meralco's application cannot be given due course or has to be dismissed.
Finally, it may be observed that the constitutional prohibition makes no
distinction between (on the one hand) alienable agricultural public lands as
to which no occupant has an imperfect title and (on the other hand)
alienable lands of the public domain as to which an occupant has on
imperfect title subject to judicial confirmation.
Since section 11 of Article XIV does not distinguish, we should not make any
distinction or qualification. The prohibition applies to alienable public lands
as to which a Torrens title may be secured under section 48(b). The
proceeding under section 48(b) 'presupposes that the land is public'
(Mindanao vs. Director of Lands, L-19535, July 30, 1967, 20 SCRA 641, 644).
The present Chief Justice entered a vigorous dissent, tracing the line of cases
beginning with Carino in 1909 2 thru Susi in 1925 3 down to Herico in
1980, 4 which developed, affirmed and reaffirmed the doctrine that 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.
That said dissent expressed what is the better — and, indeed, the correct,
view-becomes evident from a consideration of some of the principal rulings
cited therein,
The main theme was given birth, so to speak, in Carino involving the
Decree/Regulations of June 25, 1880 for adjustment of royal lands wrongfully
occupied by private individuals in the Philippine Islands. It was ruled that:
It is true that the language of articles 4 and 5 5 attributes title to those 'who
may prove' possession for the necessary time and we do not overlook the
argument that this means may prove in registration proceedings. It may be
that an English conveyancer would have recommended an application under
the foregoing decree, but certainly it was not calculated to convey to the
mind of an Igorot chief the notion that ancient family possessions were in
danger, if he had read every word of it. The words 'may prove' (acrediten) as
well or better, in view of the other provisions, might be taken to mean when
called upon to do so in any litigation. There are indications that registration
was expected from all but none sufficient to show that, for want of it,
ownership actually gained would be lost. The effect of the proof, wherever
made, was not to confer title, but simply to establish it, as already conferred
by the decree, if not by earlier law. ...
That ruling assumed a more doctrinal character because expressed in more
categorical language, in Susi:
.... In favor of Valentin Susi, there is, moreover, the presumption juris et de
jure established in paragraph (b) of section 45 of Act No. 2874, amending Act
No. 926, that all the necessary requirements for a grant by the Government
were complied with, for he has been in actual and physical possession,
personally and through his predecessors, of an agricultural land of the public
domain openly, continuously, exclusively and publicly since July 26, 1984,
with a right to a certificate of title to said land under the provisions of
Chapter VIII of said Act. So that when Angela Razon applied for the grant in
her favor, Valentin Susi had already acquired, by operation of law not only a
right to a grant, but a grant of the Government, for it is not necessary that a
certificate of title should be issued in order that said grant may be sanctioned
by the courts, an application therefore is sufficient, under the provisions of
section 47 of Act No. 2874. If by a legal fiction, Valentin Susi had acquired the
land in question by a grant of the State, it had already ceased to be of the
public domain and had become private property, at least by presumption, of
Valentin Susi, beyond the control of the Director of Lands. Consequently, in
selling the land in question of Angela Razon, the Director of Lands disposed
of a land over which he had no longer any title or control, and the sale thus
made was void and of no effect, and Angela Razon did not thereby acquire
any right. 6
Succeeding cases, of which only some need be mentioned, likeof Lacaste vs.
Director of Lands, 7 Mesina vs. Vda. de Sonza, 8 Manarpac vs.
Cabanatuan, 9 Miguel vs. Court of Appeals 10 and Herico vs. Dar, supra, by
invoking and affirming the Susi doctrine have firmly rooted it in
jurisprudence.
Herico, in particular, appears to be squarely affirmative: 11
.... Secondly, under the provisions of Republic Act No. 1942, which the
respondent Court held to be inapplicable to the petitioner's case, with the
latter's proven occupation and cultivation for more than 30 years since 1914,
by himself and by his predecessors-in-interest, title over the land has vested
on petitioner so as to segregate the land from the mass of public
land. Thereafter, it is no longer disposable under the Public Land Act as by
free patent. ....
xxx xxx xxx
As interpreted in several cases, when the conditions as specified in the
foregoing provision are complied with, the possessor is deemed to have
acquired, by operation of law, a right to a grant, a government grant, without
the necessity of a certificate of title being issued. The land, therefore, ceases
to be of the public domain and beyond the authority of the Director of Lands
to dispose of. The application for confirmation is mere formality, the lack of
which does not affect the legal sufficiency of the title as would be evidenced
by the patent and the Torrens title to be issued upon the strength of said
patent. 12
Nothing can more clearly demonstrate the logical inevitability of considering
possession of public land which is of the character and duration prescribed
by statute as the equivalent of an express grant from the State than the
dictum of the statute itself 13 that the possessor(s) "... shall be conclusively
presumed to have performed all the conditions essential to a Government
grant and shall be entitled to a certificate of title .... " No proof being
admissible to overcome a conclusive presumption, confirmation proceedings
would, in truth be little more than a formality, at the most limited to
ascertaining whether the possession claimed is of the required character and
length of time; and registration thereunder would not confer title, but simply
recognize a title already vested. The proceedings would not originally convert
the land from public to private land, but only confirm such a conversion
already affected by operation of law from the moment the required period of
possession became complete. As was so well put in Carino, "... (T)here are
indications that registration was expected from all, but none sufficient to
show that, for want of it, ownership actually gained would be lost. The effect
of the proof, wherever made, was not to confer title, but simply to establish
it, as already conferred by the decree, if not by earlier law."
If it is accepted-as it must be-that the land was already private land to which
the Infiels had a legally sufficient and transferable title on October 29, 1962
when Acme acquired it from said owners, it must also be conceded that
Acme had a perfect right to make such acquisition, there being nothing in the
1935 Constitution then in force (or, for that matter, in the 1973 Constitution
which came into effect later) prohibiting corporations from acquiring and
owning private lands.
Even on the proposition that the land remained technically "public" land,
despite immemorial possession of the Infiels and their ancestors, until title in
their favor was actually confirmed in appropriate proceedings under the
Public Land Act, there can be no serious question of Acmes right to acquire
the land at the time it did, there also being nothing in the 1935 Constitution
that might be construed to prohibit corporations from purchasing or
acquiring interests in public land to which the vendor had already acquired
that type of so-called "incomplete" or "imperfect" title. The only limitation
then extant was that corporations could not acquire, hold or lease public
agricultural lands in excess of 1,024 hectares. The purely accidental
circumstance that confirmation proceedings were brought under the aegis of
the 1973 Constitution which forbids corporations from owning lands of the
public domain cannot defeat a right already vested before that law came into
effect, or invalidate transactions then perfectly valid and proper. This Court
has already held, in analogous circumstances, that the Constitution cannot
impair vested rights.
We hold that the said constitutional prohibition 14 has no retroactive
application to the sales application of Binan Development Co., Inc. because it
had already acquired a vested right to the land applied for at the time the
1973 Constitution took effect.
That vested right has to be respected. It could not be abrogated by the new
Constitution. Section 2, Article XIII of the 1935 Constitution allows private
corporations to purchase public agricultural lands not exceeding one
thousand and twenty-four hectares. Petitioner' prohibition action is barred
by the doctrine of vested rights in constitutional law.
xxx xxx xxx
The due process clause prohibits the annihilation of vested rights. 'A state
may not impair vested rights by legislative enactment, by the enactment or
by the subsequent repeal of a municipal ordinance, or by a change in the
constitution of the State, except in a legitimate exercise of the police
power'(16 C.J.S. 1177-78).
xxx xxx xxx
In the instant case, it is incontestable that prior to the effectivity of the 1973
Constitution the right of the corporation to purchase the land in question had
become fixed and established and was no longer open to doubt or
controversy.
Its compliance with the requirements of the Public Land Law for the issuance
of a patent had the effect of segregating the said land from the public
domain. The corporation's right to obtain a patent for the land is protected
by law. It cannot be deprived of that right without due process (Director of
Lands vs. CA, 123 Phil. 919).<äre||anº•1àw>  15
The fact, therefore, that the confirmation proceedings were instituted by
Acme in its own name must be regarded as simply another accidental
circumstance, productive of a defect hardly more than procedural and in
nowise affecting the substance and merits of the right of ownership sought
to be confirmed in said proceedings, there being no doubt of Acme's
entitlement to the land. As it is unquestionable that in the light of the
undisputed facts, the Infiels, under either the 1935 or the 1973 Constitution,
could have had title in themselves confirmed and registered, only a rigid
subservience to the letter of the law would deny the same benefit to their
lawful successor-in-interest by valid conveyance which violates no
constitutional mandate.
The Court, in the light of the foregoing, is of the view, and so holds, that the
majority ruling in Meralco must be reconsidered and no longer deemed to be
binding precedent. The correct rule, as enunciated in the line of cases already
referred to, is that alienable public land held by a possessor, personally or
through his predecessors-in-interest, openly, continuously and exclusively for
the prescribed statutory period (30 years under The Public Land Act, as
amended) is converted to private property by the mere lapse or completion
of said period, ipso jure. Following that rule and on the basis of the
undisputed facts, the land subject of this appeal was already private property
at the time it was acquired from the Infiels by Acme. Acme thereby acquired
a registrable title, there being at the time no prohibition against said
corporation's holding or owning private land. The objection that, as a juridical
person, Acme is not qualified to apply for judicial confirmation of title under
section 48(b) of the Public Land Act is technical, rather than substantial and,
again, finds its answer in the dissent in Meralco:
6. To uphold respondent judge's denial of Meralco's application on the
technicality that the Public Land Act allows only citizens of the Philippines
who are natural persons to apply for confirmation of their title would be
impractical and would just give rise to multiplicity of court actions. Assuming
that there was a technical error not having filed the application for
registration in the name of the Piguing spouses as the original owners and
vendors, still it is conceded that there is no prohibition against their sale of
the land to the applicant Meralco and neither is there any prohibition against
the application being refiled with retroactive effect in the name of the
original owners and vendors (as such natural persons) with the end result of
their application being granted, because of their indisputable acquisition of
ownership by operation of law and the conclusive presumption therein
provided in their favor. It should not be necessary to go through all the
rituals at the great cost of refiling of all such applications in their names and
adding to the overcrowded court dockets when the Court can after all these
years dispose of it here and now. (See Francisco vs. City of Davao)
The ends of justice would best be served, therefore, by considering the
applications for confirmation as amended to conform to the evidence, i.e. as
filed in the names of the original persons who as natural persons are duly
qualified to apply for formal confirmation of the title that they had acquired
by conclusive presumption and mandate of the Public Land Act and who
thereafter duly sold to the herein corporations (both admittedly Filipino
corporations duly qualified to hold and own private lands) and granting the
applications for confirmation of title to the private lands so acquired and sold
or exchanged.
There is also nothing to prevent Acme from reconveying the lands to the
Infiels and the latter from themselves applying for confirmation of title and,
after issuance of the certificate/s of title in their names, deeding the lands
back to Acme. But this would be merely indulging in empty charades,
whereas the same result is more efficaciously and speedily obtained, with no
prejudice to anyone, by a liberal application of the rule on amendment to
conform to the evidence suggested in the dissent in Meralco.
While this opinion seemingly reverses an earlier ruling of comparatively
recent vintage, in a real sense, it breaks no precedent, but only reaffirms and
re-established, as it were, doctrines the soundness of which has passed the
test of searching examination and inquiry in many past cases. Indeed, it is
worth noting that the majority opinion, as well as the concurring opinions of
Chief Justice Fernando and Justice Abad Santos, in Meralco rested chiefly on
the proposition that the petitioner therein, a juridical person, was
disqualified from applying for confirmation of an imperfect title to public
land under Section 48(b) of the Public Land Act. Reference to the 1973
Constitution and its Article XIV, Section 11, was only tangential limited to a
brief paragraph in the main opinion, and may, in that context, be considered
as essentially obiter. Meralco, in short, decided no constitutional question.
WHEREFORE, there being no reversible error in the appealed judgment of the
Intermediate Appellate Court, the same is hereby affirmed, without costs in
this instance.
SO ORDERED.
G.R. No. L-6776             May 21, 1955
THE REGISTER OF DEEDS OF RIZAL, petitioner-appellee,
vs.
UNG SIU SI TEMPLE, respondent-appellant.
Alejo F. Candido for appellant.
Office of the Solicitor General Querube C. Makalintal and Solicitor Felix V.
Makasiar for appellee.
REYES, J.B.L., J.:
The Register of Deeds for the province of Rizal refused to accept for record a
deed of donation executed in due form on January 22, 1953, by Jesus Dy, a
Filipino citizen, conveying a parcel of residential land, in Caloocan, Rizal,
known as lot No. 2, block 48-D, PSD-4212, G.L.R.O. Record No. 11267, in
favor of the unregistered religious organization "Ung Siu Si Temple",
operating through three trustees all of Chinese nationality. The donation was
duly accepted by Yu Juan, of Chinese nationality, founder and deaconess of
the Temple, acting in representation and in behalf of the latter and its
trustees.
The refusal of the Registrar was elevated en Consultato the IVth Branch of
the Court of First Instance of Manila. On March 14, 1953, the Court upheld
the action of the Rizal Register of Deeds, saying:
The question raised by the Register of Deeds in the above transcribed
consulta is whether a deed of donation of a parcel of land executed in favor
of a religious organization whose founder, trustees and administrator are
Chinese citizens should be registered or not.
The fact that the appellant religious organization has no capital stock does
not suffice to escape the Constitutional inhibition, since it is admitted that its
members are of foreign nationality. The purpose of the sixty per centum
requirement is obviously to ensure that corporations or associations allowed
to acquire agricultural land or to exploit natural resources shall be controlled
by Filipinos; and the spirit of the Constitution demands that in the absence of
capital stock, the controlling membership should be composed of Filipino
citizens.
To permit religious associations controlled by non-Filipinos to acquire
agricultural lands would be to drive the opening wedge to revive alien
religious land holdings in this country. We can not ignore the historical fact
that complaints against land holdings of that kind were among the factors
that sparked the revolution of 1896.
As to the complaint that the disqualification under article XIII is violative of
the freedom of religion guaranteed by Article III of the Constitution, we are
by no means convinced (nor has it been shown) that land tenure is
indispensable to the free exercise and enjoyment of religious profession or
worship; or that one may not worship the Deity according to the dictates of
his own conscience unless upon land held in fee simple.
The resolution appealed from is affirmed, with costs against appellant.

It appearing from the record of the Consulta that UNG SIU SI TEMPLE is a
religious organization whose deaconess, founder, trustees and administrator
are all Chinese citizens, this Court is of the opinion and so hold that in view of
the provisions of the sections 1 and 5 of Article XIII of the Constitution of the
Philippines limiting the acquisition of land in the Philippines to its citizens, or
to corporations or associations at least sixty per centum of the capital stock
of which is owned by such citizens adopted after the enactment of said Act
No. 271, and the decision of the Supreme Court in the case of Krivenko vs.
the Register of Deeds of Manila, the deed of donation in question should not
be admitted for admitted for registration. (Printed Rec. App. pp 17-18).

Not satisfied with the ruling of the Court of First Instance, counsel for the
donee Uy Siu Si Temple has appealed to this Court, claiming: (1) that the
acquisition of the land in question, for religious purposes, is authorized and
permitted by Act No. 271 of the old Philippine Commission, providing as
follows:

SECTION 1. It shall be lawful for all religious associations, of whatever sort or

denomination, whether incorporated in the Philippine Islands or in the name
of other country, or not incorporated at all, to hold land in the Philippine
Islands upon which to build churches, parsonages, or educational or
charitable institutions.

SEC. 2. Such religious institutions, if not incorporated, shall hold the land in
the name of three Trustees for the use of such associations; . . .. (Printed Rec.
App. p. 5.)

and (2) that the refusal of the Register of Deeds violates the freedom of
religion clause of our Constitution [Art. III, Sec. 1(7)].

We are of the opinion that the Court below has correctly held that in view of
the absolute terms of section 5, Title XIII, of the Constitution, the provisions
of Act No. 271 of the old Philippine Commission must be deemed repealed
since the Constitution was enacted, in so far as incompatible therewith. In
providing that, —

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

transferred or assigned except to individuals, corporations or associations
qualified to acquire or hold lands of the public domain in the Philippines,

the Constitution makes no exception in favor of religious associations. .R. No. L-8451        December 20, 1957
Neither is there any such saving found in sections 1 and 2 of Article XIII,
THE ROMAN CATHOLIC APOSTOLIC ADMINISTRATOR OF DAVAO,
restricting the acquisition of public agricultural lands and other natural
INC., petitioner,
resources to "corporations or associations at least sixty per centum of the
vs.
capital of which is owned by such citizens" (of the Philippines).
THE LAND REGISTRATION COMMISSION and THE REGISTER OF DEEDS OF
DAVAO CITY, respondents.
Teodoro Padilla, for petitioner.
Office of the Solicitor General Ambrosio Padilla, Assistant Solicitor General
Jose G. Bautista and Troadio T. Quianzon, Jr., for respondents.
FELIX, J.:
This is a petition for mandamus filed by the Roman Catholic Apostolic
Administrator of Davao seeking the reversal of a resolution by the Land
Registration Commissioner in L.R.C. Consulta No. 14. The facts of the case are
as follows:
On October 4, 1954, Mateo L. Rodis, a Filipino citizen and resident of the City
of Davao, executed a deed of sale of a parcel of land located in the same city
covered by Transfer Certificate No. 2263, in favor of the Roman Catholic
Apostolic Administrator of Davao Inc., s corporation sole organized and
existing in accordance with Philippine Laws, with Msgr. Clovis Thibault, a
Canadian citizen, as actual incumbent. When the deed of sale was presented
to Register of Deeds of Davao for registration, the latter.
having in mind a previous resolution of the Fourth Branch of the Court of
First Instance of Manila wherein the Carmelite Nuns of Davao were made to
prepare an affidavit to the effect that 60 per cent of the members of their
corporation were Filipino citizens when they sought to register in favor of
their congregation of deed of donation of a parcel of land—
required said corporation sole to submit a similar affidavit declaring that 60
per cent of the members thereof were Filipino citizens.
The vendee in the letter dated June 28, 1954, expressed willingness to
submit an affidavit, both not in the same tenor as that made the Progress of
the Carmelite Nuns because the two cases were not similar, for whereas the
congregation of the Carmelite Nuns had five incorporators, the corporation
sole has only one; that according to their articles of incorporation, the
organization of the Carmelite Nuns became the owner of properties donated
to it, whereas the case at bar, the totality of the Catholic population of Davao
would become the owner of the property bought to be registered.
As the Register of Deeds entertained some doubts as to the registerability if
the document, the matter was referred to the Land Registration
Commissioner en consulta for resolution in accordance with section 4 of
Republic Act No. 1151. Proper hearing on the matter was conducted by the
Commissioner and after the petitioner corporation had filed its
memorandum, a resolution was rendered on September 21, 1954, holding
that in view of the provisions of Section 1 and 5 of Article XIII of the
Philippine Constitution, the vendee was not qualified to acquire private lands
in the Philippines in the absence of proof that at least 60 per centum of the
capital, property, or assets of the Roman Catholic Apostolic Administrator of
Davao, Inc., was actually owned or controlled by Filipino citizens, there being
no question that the present incumbent of the corporation sole was a
Canadian citizen. It was also the opinion of the Land Registration
Commissioner that section 159 of the corporation Law relied upon by the
vendee was rendered operative by the aforementioned provisions of the
Constitution with respect to real estate, unless the precise condition set
therein — that at least 60 per cent of its capital is owned by Filipino citizens
— be present, and, therefore, ordered the Registered Deeds of Davao to
deny registration of the deed of sale in the absence of proof of compliance
with such condition.
After the motion to reconsider said resolution was denied, an action
for mandamus was instituted with this Court by said corporation sole,
alleging that under the Corporation Law as well as the settled jurisprudence
on the matter, the deed of sale executed by Mateo L. Rodis in favor of
petitioner is actually a deed of sale in favor of the Catholic Church which is
qualified to acquire private agricultural lands for the establishment and
maintenance of places of worship, and prayed that judgment be rendered
reserving and setting aside the resolution of the Land Registration
Commissioner in question. In its resolution of November 15, 1954, this Court
gave due course to this petition providing that the procedure prescribed for
appeals from the Public Service Commission of the Securities and Exchange
Commissions (Rule 43), be followed.
Section 5 of Article XIII of the Philippine Constitution reads as follows:
SEC. 5. Save in cases of hereditary succession, no private agricultural
land shall be transferred or assigned except to individuals, corporations, or
associations qualified to acquire or hold lands of the public domain in the
Philippines.
Section 1 of the same Article also provides the following:
SECTION 1. All agricultural, timber, and mineral lands of the public domain,
water, minerals, coal, petroleum, and other mineral oils, all forces of
potential energy, and other natural resources of the Philippines belong to the
State, and their disposition, exploitation, development, or utilization shall be
limited to cititzens of the Philippines, or to corporations or associations at
least sixty per centum of the capital of which is owned by such citizens,
SUBJECT TO ANY EXISTING RIGHT, grant, lease, or concession AT THE TIME
OF THE INAUGURATION OF THE GOVERNMENT ESTABLISHED UNDER
CONSTITUTION. Natural resources, with the exception of public agricultural
land, shall not be alienated, and no license, concession, or leases for the
exploitation, development, or utilization of any of the natural resources shall
be granted for a period exceeding twenty-five years, renewable for another
twenty-five years, except as to water rights for irrigation, water supply,
fisheries, or industrial uses other than the development of water power, in
which cases other than the development and limit of the grant.
In virtue of the foregoing mandates of the Constitution, who are considered
"qualified" to acquire and hold agricultural lands in the Philippines? What is
the effect of these constitutional prohibition of the right of a religious
corporation recognized by our Corporation Law and registered as
a corporation sole, to possess, acquire and register real estates in its name
when the Head, Manager, Administrator or actual incumbent is an alien?
Petitioner consistently maintained that a corporation sole, irrespective of the
citizenship of its incumbent, is not prohibited or disqualified to acquire and
hold real properties. The Corporation Law and the Canon Law are explicit in
their provisions that a corporation sole or "ordinary" is not the owner of the
of the properties that he may acquire but merely the administrator thereof.
The Canon Law also specified that church temporalities are owned by the
Catholic Church as a "moral person" or by the diocess as minor "moral
persons" with the ordinary or bishop as administrator.
And elaborating on the composition of the Catholic Church in the Philippines,
petitioner explained that as a religious society or organization, it is made up
of 2 elements or divisions — the clergy or religious members and the faithful
or lay members. The 1948 figures of the Bureau of Census showed that there
were 277,551 Catholics in Davao and aliens residing therein numbered 3,465.
Ever granting that all these foreigners are Catholics, petitioner contends that
Filipino citizens form more than 80 per cent of the entire Catholics
population of that area. As to its clergy and religious composition, counsel for
petitioner presented the Catholic Directory of the Philippines for 1954
(Annex A) which revealed that as of that year, Filipino clergy and women
novices comprise already 60.5 per cent of the group. It was, therefore,
allowed that the constitutional requirement was fully met and satisfied.
Respondents, on the other hand, averred that although it might be true that
petitioner is not the owner of the land purchased, yet he has control over the
same, with full power to administer, take possession of, alienate, transfer,
encumber, sell or dispose of any or all lands and their improvements
registered in the name of the corporation sole and can collect, receive,
demand or sue for all money or values of any kind that may be kind that may
become due or owing to said corporation, and vested with authority to enter
into agreements with any persons, concerns or entities in connection with
said real properties, or in other words, actually exercising all rights of
ownership over the properties. It was their stand that the theory that
properties registered in the name of the corporation sole are held in true for
the benefit of the Catholic population of a place, as of Davao in the case at
bar should be sustained because a conglomeration of persons cannot just be
pointed out as the cestui que trust or recipient of the benefits from the
property allegedly administered in their behalf. Neither can it be said that
the mass of people referred to as such beneficiary exercise ant right of
ownership over the same. This set-up, respondents argued, falls short of a
trust. The respondents instead tried to prove that in reality, the beneficiary
of ecclesiastical properties are not members or faithful of the church but
someone else, by quoting a portion a portion of the ought of fidelity
subscribed by a bishop upon his elevation to the episcopacy wherein he
promises to render to the Pontificial Father or his successors an account of
his pastoral office and of all things appertaining to the state of this church.
Respondents likewise advanced the opinion that in construing the
constitutional provision calling for 60 per cent of Filipino citizenship, the
criterion of the properties or assets thereof.
In solving the problem thus submitted to our consideration, We can say the
following: A corporation sole is a special form of corporation usually
associated with the clergy. Conceived and introduced into the common law
by sheer necessity, this legal creation which was referred to as "that unhappy
freak of English law" was designed to facilitate the exercise of the functions
of ownership carried on by the clerics for and on behalf of the church which
was regarded as the property owner (See I Couvier's Law Dictionary, p. 682-
683).
A corporation sole consists of one person only, and his successors (who will
always be one at a time), in some particular station, who are incorporated by
law in order to give them some legal capacities and advantages, particularly
that of perpetuity, which in their natural persons they could not have had. In
this sense, the king is a sole corporation; so is a bishop, or dens, distinct from
their several chapters (Reid vs. Barry, 93 Fla. 849, 112 So. 846).
The provisions of our Corporation law on religious corporations are
illuminating and sustain the stand of petitioner. Section 154 thereof
provides:
SEC. 154. — For the administration of the temporalities of any religious
denomination, society or church and the management of the estates and the
properties thereof, it shall be lawful for the bishop, chief priest, or presiding
either of any such religious denomination, society or church to become a
corporation sole, unless inconsistent wit the rules, regulations or discipline of
his religious denomination, society or church or forbidden by competent
authority thereof.
See also the pertinent provisions of the succeeding sections of the same
Corporation Law copied hereunder:
SEC. 155. In order to become a corporation sole the bishop, chief priest, or
presiding elder of any religious denomination, society or church must file
with the Securities and Exchange Commissioner articles of incorporation
setting forth the following facts:
xxx xxx xxx.
(3) That as such bishop, chief priest, or presiding elder he is charged with the
administration of the temporalities and the management of the estates and
properties of his religious denomination, society, or church within its
territorial jurisdiction, describing it;
xxx xxx xxx.
(As amended by Commonwealth Act No. 287).
SEC. 157. From and after the filing with the Securities and Exchange
Commissioner of the said articles of incorporation, which verified by affidavit
or affirmation as aforesaid and accompanied by the copy of the commission,
certificate of election, or letters of appointment of the bishop, chief priest, or
presiding elder, duly certified as prescribed in the section immediately
preceding such the bishop, chief priest, or presiding elder, as the case may
be, shall become a corporation sole and all temporalities, estates, and
properties the religious denomination, society, or church therefore
administered or managed by him as such bishop, chief priest, or presiding
elder, shall be held in trust by him as a corporation sole, for the use, purpose,
behalf, and sole benefit of his religious denomination, society, or church,
including hospitals, schools, colleges, orphan, asylums, parsonages, and
cemeteries thereof. For the filing of such articles of incorporation, the
Securities and Exchange Commissioner shall collect twenty-five pesos. (As
amended by Commonwealth Act. No. 287); and.
SEC. 163. The right to administer all temporalities and all property held or
owned by a religious order or society, or by the diocese, synod, or district
organization of any religious denomination or church shall, on its
incorporation, pass to the corporation and shall be held in trust for the use,
purpose behalf, and benefit of the religious society, or order so incorporated
or of the church of which the diocese, or district organization is an organized
and constituent part.
The Cannon Law contains similar provisions regarding the duties of the
corporation sole or ordinary as administrator of the church properties, as
follows:
Al Ordinario local pertenence vigilar diligentemente sobre
la administracion de todos los bienes eclesiasticos que se hallan en su
territorio y no estuvieren sustraidos de su jurisdiccion, salvs las prescriciones
legitimas que le concedan mas aamplios derechos.
Teniendo en cuenta los derechos y las legitimas costumbres y circunstancias,
procuraran los Ordinarios regular todo lo concerniente a la administracion de
los bienes eclesciasticos, dando las oportunas instucciones particularles
dentro del narco del derecho comun. (Title XXVIII, Codigo de Derecho
Canonico, Lib. III, Canon 1519).1
That leaves no room for doubt that the bishops or archbishops, as the case
may be, as corporation's sole are merely administrators of the church
properties that come to their possession, in which they hold in trust for the
church. It can also be said that while it is true that church properties could be
administered by a natural persons, problems regarding succession to said
properties can not be avoided to rise upon his death. Through this legal
fiction, however, church properties acquired by the incumbent of a
corporation sole pass, by operation of law, upon his death not his personal
heirs but to his successor in office. It could be seen, therefore, that a
corporation sole is created not only to administer the temporalities of the
church or religious society where he belongs but also to hold and transmit
the same to his successor in said office. If the ownership or title to the
properties do not pass to the administrators, who are the owners of church
properties?.
Bouscaren and Elis, S.J., authorities on cannon law, on their treatise
comment:
In matters regarding property belonging to the Universal Church and to the
Apostolic See, the Supreme Pontiff exercises his office of supreme
administrator through the Roman Curia; in matters regarding other church
property, through the administrators of the individual moral persons in the
Church according to that norms, laid down in the Code of Cannon Law. This
does not mean, however, that the Roman Pontiff is the owner of all the
church property; but merely that he is the supreme guardian (Bouscaren and
Ellis, Cannon Law, A Text and Commentary, p. 764).
and this Court, citing Campes y Pulido, Legislacion y Jurisprudencia Canonica,
ruled in the case of Trinidad vs. Roman Catholic Archbishop of Manila, 63
Phil. 881, that:
The second question to be decided is in whom the ownership of the
properties constituting the endowment of the ecclesiastical or collative
chaplaincies is vested.
Canonists entertain different opinions as to the persons in whom the
ownership of the ecclesiastical properties is vested, with respect to which we
shall, for our purpose, confine ourselves to stating with Donoso that, while
many doctors cited by Fagnano believe that it resides in the Roman Pontiff as
Head of the Universal Church, it is more probable that ownership, strictly
speaking, does not reside in the latter, and, consequently, ecclesiastical
properties are owned by the churches, institutions and canonically
established private corporations to which said properties have been donated.
Considering that nowhere can We find any provision conferring ownership of
church properties on the Pope although he appears to be the supreme
administrator or guardian of his flock, nor on the corporation sole or heads of
dioceses as they are admittedly mere administrators of said properties,
ownership of these temporalities logically fall and develop upon the church,
diocese or congregation acquiring the same. Although this question of
ownership of ecclesiastical properties has off and on been mentioned in
several decisions of the Court yet in no instance was the subject of
citizenship of this religious society been passed upon.
We are not unaware of the opinion expressed by the late Justice Perfecto in
his dissent in the case of Agustines vs. Court of First Instance of Bulacan, 80
Phil. 565, to the effect that "the Roman Catholic Archbishop of Manila is only
a branch of a universal church by the Pope, with permanent residence in
Rome, Italy". There is no question that the Roman Catholic Church existing in
the Philippines is a tributary and part of the international religious
organization, for the word "Roman" clearly expresses its unity with and
recognizes the authority of the Pope in Rome. However, lest We become
hasty in drawing conclusions, We have to analyze and take note of the nature
of the government established in the Vatican City, of which it was said:
GOVERNMENT. In the Roman Catholic Church supreme authority and
jurisdiction over clergy and laity alike as held by the pope who (since the
Middle Ages) is elected by the cardinals assembled in conclave, and holds
office until his death or legitimate abdication. . . While the pope is obviously
independent of the laws made, and the officials appointed, by himself or his
predecessors, he usually exercises his administrative authority according to
the code of canon law and through the congregations, tribunals and offices
of the Curia Romana. In their respective territories (called generally dioceses)
and over their respective subjects, the patriarchs, metropolitans or
archbishops and bishops exercise a jurisdiction which is called ordinary (as
attached by law to an office given to a person. . . (Collier's Encyclopedia, Vol.
17, p. 93).
While it is true and We have to concede that in the profession of their faith,
the Roman Pontiff is the supreme head; that in the religious matters, in the
exercise of their belief, the Catholic congregation of the faithful throughout
the world seeks the guidance and direction of their Spiritual Father in the
Vatican, yet it cannot be said that there is a merger of personalities resultant
therein. Neither can it be said that the political and civil rights of the faithful,
inherent or acquired under the laws of their country, are affected by that
relationship with the Pope. The fact that the Roman Catholic Church in
almost every country springs from that society that saw its beginning in
Europe and the fact that the clergy of this faith derive their authorities and
receive orders from the Holy See do not give or bestow the citizenship of the
Pope upon these branches. Citizenship is a political right which cannot be
acquired by a sort of "radiation". We have to realize that although there is a
fraternity among all the catholic countries and the dioceses therein all over
the globe, the universality that the word "catholic" implies, merely
characterize their faith, a uniformity in the practice and the interpretation of
their dogma and in the exercise of their belief, but certainly they are
separate and independent from one another in jurisdiction, governed by
different laws under which they are incorporated, and entirely independent
on the others in the management and ownership of their temporalities. To
allow theory that the Roman Catholic Churches all over the world follow the
citizenship of their Supreme Head, the Pontifical Father, would lead to the
absurdity of finding the citizens of a country who embrace the Catholic faith
and become members of that religious society, likewise citizens of the
Vatican or of Italy. And this is more so if We consider that the Pope himself
may be an Italian or national of any other country of the world. The same
thing be said with regard to the nationality or citizenship of the corporation
sole created under the laws of the Philippines, which is not altered by the
change of citizenship of the incumbent bishops or head of said corporation
sole.
We must therefore, declare that although a branch of the Universal Roman
Catholic Apostolic Church, every Roman Catholic Church in different
countries, if it exercises its mission and is lawfully incorporated in accordance
with the laws of the country where it is located, is considered an entity or
person with all the rights and privileges granted to such artificial being under
the laws of that country, separate and distinct from the personality of the
Roman Pontiff or the Holy See, without prejudice to its religious relations
with the latter which are governed by the Canon Law or their rules and
regulations.
We certainly are conscious of the fact that whatever conclusion We may
draw on this matter will have a far reaching influence, nor can We overlook
the pages of history that arouse indignation and criticisms against church
landholdings. This nurtured feeling that snowbailed into a strong nationalistic
sentiment manifested itself when the provisions on natural to be embodied
in the Philippine Constitution were framed, but all that has been said on this
regard referred more particularly to landholdings of religious corporations
known as "Friar Estates" which have already bee acquired by our
government, and not to properties held by corporations sole which, We
repeat, are properties held in trust for the benefit of the faithful residing
within its territorial jurisdiction. Though that same feeling probably
precipitated and influenced to a large extent the doctrine laid down in the
celebrated Krivenco decision, We have to take this matter in the light of legal
provisions and jurisprudence actually obtaining, irrespective of sentiments.
The question now left for our determination is whether the Universal Roman
Catholic Apostolic Church in the Philippines, or better still, the corporation
sole named the Roman Catholic Apostolic Administrator of Davao, Inc., is
qualified to acquire private agricultural lands in the Philippines pursuant to
the provisions of Article XIII of the Constitution.
We see from sections 1 and 5 of said Article quoted before, that only persons
or corporations qualified to acquire hold lands of the public domain in the
Philippines may acquire or be assigned and hold private agricultural lands.
Consequently, the decisive factor in the present controversy hinges on the
proposition or whether or not the petitioner in this case can acquire
agricultural lands of the public domain.
From the data secured from the Securities and Exchange Commission, We
find that the Roman Catholic Bishop of Zamboanga was incorporated (as a
corporation sole) in September, 1912, principally to administer its
temporalities and manage its properties. Probably due to the ravages of the
last war, its articles of incorporation were reconstructed in the Securities and
Exchange Commission on April 8, 1948. At first, this corporation sole
administered all the temporalities of the church existing or located in the
island of Mindanao. Later on, however, new dioceses were formed and new
corporations sole were created to correspond with the territorial jurisdiction
of the new dioceses, one of them being petitioner herein, the Roman
Catholic Apostolic Administrator of Davao, Inc., which was registered with
the Securities and Exchange Commission on September 12, 1950, and
succeeded in the administrative for all the "temporalities" of the Roman
Catholic Church existing in Davao.
According to our Corporation Law, Public Act No. 1549, approved April 1,
1906, a corporation sole.
is organized and composed of a single individual, the head of any religious
society or church, for the ADMINISTRATION of the temporalities of such
society or church. By "temporalities" is meant estate and properties not used
exclusively for religious worship. The successor in office of such religious
head or chief priest incorporated as a corporation sole shall become the
corporation sole on ascension to office, and shall be permitted to transact
business as such on filing with the Securities and Exchange Commission a
copy of his commission, certificate of election or letter of appointment duly
certified by any notary public or clerk of court of record (Guevara's The
Philippine Corporation Law, p. 223).
The Corporation Law also contains the following provisions:
SECTION 159. Any corporation sole may purchase and hold real estate and
personal; property for its church, charitable, benevolent, or educational
purposes, and may receive bequests or gifts of such purposes. Such
corporation may mortgage or sell real property held by it upon obtaining an
order for that purpose from the Court of First Instance of the province in
which the property is situated; but before making the order proof must be
made to the satisfaction of the Court that notice of the application for leave
to mortgage or sell has been given by publication or otherwise in such
manner and for such time as said Court or the Judge thereof may have
directed, and that it is to the interest of the corporation that leave to
mortgage or sell must be made by petition, duly verified by the bishop, chief
priest, or presiding elder acting as corporation sole, and may be opposed by
any member of the religious denomination, society or church represented by
the corporation sole: Provided, however, That in cases where the rules,
regulations, and discipline of the religious denomination, society or church
concerned represented by such corporation sole regulate the methods of
acquiring, holding, selling and mortgaging real estate and personal property,
such rules, regulations, and discipline shall control and the intervention of
the Courts shall not be necessary.
It can, therefore, be noticed that the power of a corporation sole to
purchase real property, like the power exercised in the case at bar, it is not
restricted although the power to sell or mortgage sometimes is, depending
upon the rules, regulations, and discipline of the church concerned
represented by said corporation sole. If corporations sole can purchase and
sell real estate for its church, charitable, benevolent, or educational
purposes, can they register said real properties? As provided by law, lands
held in trust for specific purposes me be subject of registration (section 69,
Act 496), and the capacity of a corporation sole, like petitioner herein, to
register lands belonging to it is acknowledged, and title thereto may be
issued in its name (Bishop of Nueva Segovia vs. Insular Government, 26 Phil.
300-1913). Indeed it is absurd that while the corporations sole that might be
in need of acquiring lands for the erection of temples where the faithful can
pray, or schools and cemeteries which they are expressly authorized by law
to acquire in connection with the propagation of the Roman Catholic
Apostolic faith or in furtherance of their freedom of religion they could not
register said properties in their name. As professor Javier J. Nepomuceno
very well says "Man in his search for the immortal and imponderable, has,
even before the dawn of recorded history, erected temples to the Unknown
God, and there is no doubt that he will continue to do so for all time to come,
as long as he continues 'imploring the aid of Divine Providence'"
(Nepomuceno's Corporation Sole, VI Ateneo Law Journal, No. 1, p. 41,
September, 1956). Under the circumstances of this case, We might safely
state that even before the establishment of the Philippine Commonwealth
and of the Republic of the Philippines every corporation sole then organized
and registered had by express provision of law the necessary power and
qualification to purchase in its name private lands located in the territory in
which it exercised its functions or ministry and for which it was created,
independently of the nationality of its incumbent unique and single member
and head, the bishop of the dioceses. It can be also maintained without fear
of being gainsaid that the Roman Catholic Apostolic Church in the Philippines
has no nationality and that the framers of the Constitution, as will be
hereunder explained, did not have in mind the religious corporations sole
when they provided that 60 per centum of the capital thereof be owned by
Filipino citizens.
There could be no controversy as to the fact that a duly registered
corporation sole is an artificial being having the right of succession and the
power, attributes, and properties expressly authorized by law or incident to
its existence (section 1, Corporation Law). In outlining the general powers of
a corporation. Public Act. No. 1459 provides among others:
SEC. 13. Every corporation has the power:
(5) To purchase, hold, convey, sell, lease, lot, mortgage, encumber, and
otherwise deal with such real and personal property as the purpose for
which the corporation was formed may permit, and the transaction of the
lawful business of the corporation may reasonably and necessarily require,
unless otherwise prescribed in this Act: . . .
In implementation of the same and specially made applicable to a form of
corporation recognized by the same law, Section 159 aforequoted expressly
allowed the corporation sole to purchase and hold real as well as personal
properties necessary for the promotion of the objects for which said
corporation sole is created. Respondent Land Registration Commissioner,
however, maintained that since the Philippine Constitution is a later
enactment than public Act No. 1459, the provisions of Section 159 in
amplification of Section 13 thereof, as regard real properties, should be
considered repealed by the former.
There is a reason to believe that when the specific provision of the
Constitution invoked by respondent Commissioner was under consideration,
the framers of the same did not have in mind or overlooked this particular
form of corporation. It is undeniable that the naturalization and conservation
of our national resources was one of the dominating objectives of the
Convention and in drafting the present Article XII of the Constitution, the
delegates were goaded by the desire (1) to insure their conservation for
Filipino posterity; (2) to serve as an instrument of national defense, helping
prevent the extension into the country of foreign control through peaceful
economic penetration; and (3) to prevent making the Philippines a source of
international conflicts with the consequent danger to its internal security and
independence (See The Framing of the Philippine Constitution by Professor
Jose M. Aruego, a Delegate to the Constitutional Convention, Vol. II. P. 592-
604). In the same book Delegate Aruego, explaining the reason behind the
first consideration, wrote:
At the time of the framing of Philippine Constitution, Filipino capital had
been to be rather shy. Filipinos hesitated s a general rule to invest a
considerable sum of their capital for the development, exploitation and
utilization of the natural resources of the country. They had not as yet been
so used to corporate as the peoples of the west. This general apathy, the
delegates knew, would mean the retardation of the development of the
natural resources, unless foreign capital would be encouraged to come and
help in that development. They knew that the naturalization of the natural
resources would certainly not encourage the INVESTMENT OF FOREIGN
CAPITAL into them. But there was a general feeling in the Convention that it
was better to have such a development retarded or even postpone together
until such time when the Filipinos would be ready and willing to undertake it
rather than permit the natural resources to be placed under the ownership
or control of foreigners in order that they might be immediately be
developed, with the Filipinos of the future serving not as owners but utmost
as tenants or workers under foreign masters. By all means, the delegates
believed, the natural resources should be conserved for Filipino posterity.
It could be distilled from the foregoing that the farmers of the Constitution
intended said provisions as barrier for foreigners or corporations financed by
such foreigners to acquire, exploit and develop our natural resources, saving
these undeveloped wealth for our people to clear and enrich when they are
already prepared and capable of doing so. But that is not the case of
corporations sole in the Philippines, for, We repeat, they are mere
administrators of the "temporalities" or properties titled in their name and
for the benefit of the members of their respective religion composed of an
overwhelming majority of Filipinos. No mention nor allusion whatsoever is
made in the Constitution as to the prohibition against or the liability of the
Roman Catholic Church in the Philippines to acquire and hold agricultural
lands. Although there were some discussions on landholdings, they were
mostly confined in the inclusion of the provision allowing the Government to
break big landed estates to put an end to absentee landlordism.
But let us suppose, for the sake of argument, that the above referred to
inhibitory clause of Section 1 of Article XIII of the constitution does have
bearing on the petitioner's case; even so the clause requiring that at least 60
per centum of the capital of the corporation be owned by Filipinos is
subordinated to the petitioner's aforesaid right already existing at the time of
the inauguration of the Commonwealth and the Republic of the Philippines.
In the language of Mr. Justice Jose P. Laurel (a delegate to the Constitutional
Convention), in his concurring opinion of the case of Gold Creek mining
Corporation, petitioner vs. Eulogio Rodriguez, Secretary of Agriculture and
Commerce, and Quirico Abadilla, Director of the Bureau of Mines,
respondent, 66 Phil. 259:
The saving clause in the section involved of the Constitution was originally
embodied in the report submitted by the Committee on Naturalization and
Preservation of Land and Other Natural Resources to the Constitutional
Convention on September 17, 1954. It was later inserted in the first draft of
the Constitution as section 13 of Article XIII thereof, and finally incorporated
as we find it now. Slight have been the changes undergone by the proviso
from the time when it comes out of the committee until it was finally
adopted. When first submitted and as inserted to the first draft of the
Constitution it reads: 'subject to any right, grant, lease, or concession existing
in respect thereto on the date of the adoption of the Constitution'. As finally
adopted, the proviso reads: 'subject to any existing right, grant, lease, or
concession at the time of the inauguration of the Government established
under this Constitution'. This recognition is not mere graciousness but
springs form the just character of the government established. The framers
of the Constitution were not obscured by the rhetoric of democracy or
swayed to hostility by an intense spirit of nationalism. They well knew that
conservation of our natural resources did not mean destruction or
annihilation of acquired property rights. Withal, they erected a government
neither episodic nor stationary but well-nigh conservative in the protection
of property rights. This notwithstanding nationalistic and socialistic traits
discoverable upon even a sudden dip into a variety of the provisions
embodied in the instrument.
The writer of this decision wishes to state at this juncture that during the
deliberation of this case he submitted to the consideration of the Court the
question that may be termed the "vested right saving clause" contained in
Section 1, Article XII of the Constitution, but some of the members of this
Court either did not agree with the theory of the writer, or were not ready to
take a definite stand on the particular point I am now to discuss deferring our
ruling on such debatable question for a better occasion, inasmuch as the
determination thereof is not absolutely necessary for the solution of the
problem involved in this case. In his desire to face the issues squarely, the
writer will endeavor, at least as a disgression, to explain and develop his
theory, not as a lucubration of the Court, but of his own, for he deems it
better and convenient to go over the cycle of reasons that are linked to one
another and that step by step lead Us to conclude as We do in the dispositive
part of this decision.
It will be noticed that Section 1 of Article XIII of the Constitution provides,
among other things, that "all agricultural lands of the public domain and their
disposition shall be limited to citizens of the Philippines or to corporations at
least 60 per centum of the capital of which is owned by such citizens, SUBJECT
TO ANY EXISTING RIGHT AT THE TIME OF THE INAUGURATION OF THE
GOVERNMENT ESTABLISHED UNDER THIS CONSTITUTION."
As recounted by Mr. Justice Laurel in the aforementioned case of Gold Creek
Mining Corporation vs. Rodriguez et al., 66 Phil. 259, "this recognition (in the
clause already quoted), is not mere graciousness but springs from the just
character of the government established. The farmers of the Constitution
were not obscured by the rhetoric of democracy or swayed to hostility by an
intense spirit of nationalism. They well knew that conservation of our natural
resources did not mean destruction or annihilation of ACQUIRED PROPERTY
RIGHTS".
But respondents' counsel may argue that the preexisting right of acquisition
of public or private lands by a corporation which does not fulfill this 60 per
cent requisite, refers to purchases of the Constitution and not to later
transactions. This argument would imply that even assuming that petitioner
had at the time of the enactment of the Constitution the right to purchase
real property or right could not be exercised after the effectivity of our
Constitution, because said power or right of corporations sole, like the herein
petitioner, conferred in virtue of the aforequoted provisions of the
Corporation Law, could no longer be exercised in view of the requisite
therein prescribed that at least 60 per centum of the capital of the
corporation had to be Filipino. It has been shown before that: (1) the
corporation sole, unlike the ordinary corporations which are formed by no
less than 5 incorporators, is composed of only one persons, usually the head
or bishop of the diocese, a unit which is not subject to expansion for the
purpose of determining any percentage whatsoever; (2) the corporation sole
is only the administrator and not the owner of the temporalities located in
the territory comprised by said corporation sole; (3) such temporalities are
administered for and on behalf of the faithful residing in the diocese or
territory of the corporation sole; and (4) the latter, as such, has no nationality
and the citizenship of the incumbent Ordinary has nothing to do with the
operation, management or administration of the corporation sole, nor
effects the citizenship of the faithful connected with their respective dioceses
or corporation sole.
In view of these peculiarities of the corporation sole, it would seem obvious
that when the specific provision of the Constitution invoked by respondent
Commissioner (section 1, Art. XIII), was under consideration, the framers of
the same did not have in mind or overlooked this particular form of
corporation. If this were so, as the facts and circumstances already indicated
tend to prove it to be so, then the inescapable conclusion would be that this
requirement of at least 60 per cent of Filipino capital was never intended to
apply to corporations sole, and the existence or not a vested right becomes
unquestionably immaterial.
But let us assumed that the questioned proviso is material. yet We might say
that a reading of said Section 1 will show that it does not refer to any actual
acquisition of land up to the right, qualification or power to acquire and hold
private real property. The population of the Philippines, Catholic to a high
percentage, is ever increasing. In the practice of religion of their faithful the
corporation sole may be in need of more temples where to pray, more
schools where the children of the congregation could be taught in the
principles of their religion, more hospitals where their sick could be treated,
more hallow or consecrated grounds or cemeteries where Catholics could be
buried, many more than those actually existing at the time of the enactment
of our Constitution. This being the case, could it be logically maintained that
because the corporation sole which, by express provision of law, has the
power to hold and acquire real estate and personal property of its churches,
charitable benevolent, or educational purposes (section 159, Corporation
Law) it has to stop its growth and restrain its necessities just because the
corporation sole is a non-stock corporation composed of only one person
who in his unity does not admit of any percentage, especially when that
person is not the owner but merely an administrator of the temporalities of
the corporation sole? The writer leaves the answer to whoever may read and
consider this portion of the decision.
Anyway, as stated before, this question is not a decisive factor in disposing
the case, for even if We were to disregard such saving clause of the
Constitution, which reads: subject to any existing right, grant, etc., at the
same time of the inauguration of the Government established under this
Constitution, yet We would have, under the evidence on record, sufficient
grounds to uphold petitioner's contention on this matter.
In this case of the Register of Deeds of Rizal vs. Ung Sui Si Temple, 2 G.R. No.
L-6776, promulgated May 21, 1955, wherein this question was considered
from a different angle, this Court through Mr. Justice J.B.L. Reyes, said:
The fact that the appellant religious organization has no capital stock does
not suffice to escape the Constitutional inhibition, since it is admitted that its
members are of foreign nationality. The purpose of the sixty per centum
requirement is obviously to ensure that corporation or associations allowed
to acquire agricultural land or to exploit natural resources shall be controlled
by Filipinos; and the spirit of the Constitution demands that in the absence of
capital stock, the controlling membership should be composed of Filipino
citizens.
In that case respondent-appellant Ung Siu Si Temple was not a corporation
sole but a corporation aggregate, i.e., an unregistered organization operating
through 3 trustees, all of Chinese nationality, and that is why this Court laid
down the doctrine just quoted. With regard to petitioner, which likewise is a
non-stock corporation, the case is different, because it is a registered
corporation sole, evidently of no nationality and registered mainly to
administer the temporalities and manage the properties belonging to the
faithful of said church residing in Davao. But even if we were to go over the
record to inquire into the composing membership to determine whether the
citizenship requirement is satisfied or not, we would find undeniable proof
that the members of the Roman Catholic Apostolic faith within the territory
of Davao are predominantly Filipino citizens. As indicated before, petitioner
has presented evidence to establish that the clergy and lay members of this
religion fully covers the percentage of Filipino citizens required by the
Constitution. These facts are not controverted by respondents and our
conclusion in this point is sensibly obvious.
Dissenting Opinion—Discussed. — After having developed our theory in the
case and arrived at the findings and conclusions already expressed in this
decision. We now deem it proper to analyze and delve into the basic
foundation on which the dissenting opinion stands up. Being aware of the
transcendental and far-reaching effects that Our ruling on the matter might
have, this case was thoroughly considered from all points of view, the Court
sparing no effort to solve the delicate problems involved herein.
At the deliberations had to attain this end, two ways were open to a prompt
dispatch of the case: (1) the reversal of the doctrine We laid down in the
celebrated Krivenko case by excluding urban lots and properties from the
group of the term "private agricultural lands" use in this section 5, Article XIII
of the Constitution; and (2) by driving Our reasons to a point that might
indirectly cause the appointment of Filipino bishops or Ordinary to head the
corporations sole created to administer the temporalities of the Roman
Catholic Church in the Philippines. With regard to the first way, a great
majority of the members of this Court were not yet prepared nor agreeable
to follow that course, for reasons that are obvious. As to the second way, it
seems to be misleading because the nationality of the head of a diocese
constituted as a corporation sole has no material bearing on the functions of
the latter, which are limited to the administration of the temporalities of the
Roman Catholic Apostolic Church in the Philippines.
Upon going over the grounds on which the dissenting opinion is based, it may
be noticed that its author lingered on the outskirts of the issues, thus
throwing the main points in controversy out of focus. Of course We fully
agree, as stated by Professor Aruego, that the framers of our Constitution
had at heart to insure the conservation of the natural resources of Our
motherland of Filipino posterity; to serve them as an instrument of national
defense, helping prevent the extension into the country of foreign
control through peaceful economic penetration; and to prevent making the
Philippines a source of international conflicts with the consequent danger to
its internal security and independence. But all these precautions adopted by
the Delegates to Our Constitutional Assembly could have not been intended
for or directed against cases like the one at bar. The emphasis and
wonderings on the statement that once the capacity of a corporation sole to
acquire private agricultural lands is admitted there will be no limit to the
areas that it may hold and that this will pave the way for the "revival or
revitalization of religious landholdings that proved so troublesome in our
past", cannot even furnish the "penumbra" of a threat to the future of the
Filipino people. In the first place, the right of Filipino citizens, including those
of foreign extraction, and Philippine corporations, to acquire private lands is
not subject to any restriction or limit as to quantity or area, and We certainly
do not see any wrong in that. The right of Filipino citizens and corporations
to acquire public agricultural lands is already limited by law. In the second
place, corporations sole cannot be considered as aliens because they have no
nationality at all. Corporations sole are, under the law, mere administrators
of the temporalities of the Roman Catholic Church in the Philippines. In the
third place, every corporation, be it aggregate or sole, is only entitled to
purchase, convey, sell, lease, let, mortgage, encumber and otherwise deal
with real properties when it is pursuant to or in consonance with the
purposes for which the corporation was formed, and when the transactions
of the lawful business of the corporation reasonably and necessarily require
such dealing — section 13-(5) of the Corporation Law, Public Act No. 1459 —
and considering these provisions in conjunction with Section 159 of the same
law which provides that a corporation sole may only "purchase and hold real
estate and personal properties for its church, charitable, benevolent or
educational purposes", the above mentioned fear of revitalization of
religious landholdings in the Philippines is absolutely dispelled. The fact that
the law thus expressly authorizes the corporations sole to receive bequests or
gifts of real properties (which were the main source that the friars had to
acquire their big haciendas during the Spanish regime), is a clear indication
that the requisite that bequests or gifts of real estate be for charitable,
benevolent, or educational purposes, was, in the opinion of the legislators,
considered sufficient and adequate protection against the revitalization of
religious landholdings.
Finally, and as previously stated, We have reason to believe that when the
Delegates to the Constitutional Convention drafted and approved Article XIII
of the Constitution they do not have in mind the corporation sole. We come
to this finding because the Constitutional Assembly, composed as it was by a
great number of eminent lawyers and jurists, was like any other legislative
body empowered to enact either the Constitution of the country or any
public statute, presumed to know the conditions existing as to particular
subject matter when it enacted a statute (Board of Commerce of Orange
Country vs. Bain, 92 S.E. 176; N. C. 377).
Immemorial customs are presumed to have been always in the mind of the
Legislature in enacting legislation. (In re Kruger's Estate, 121 A. 109; 277 P.
326).
The Legislative is presumed to have a knowledge of the state of the law on
the subjects upon which it legislates. (Clover Valley Land and Stock Co. vs.
Lamb et al., 187, p. 723,726.)
The Court in construing a statute, will assume that the legislature acted with
full knowledge of the prior legislation on the subject and its construction by
the courts. (Johns vs. Town of Sheridan, 89 N. E. 899, 44 Ind. App. 620.).
The Legislature is presumed to have been familiar with the subject with
which it was dealing . . . . (Landers vs. Commonwealth, 101 S. E. 778, 781.).
The Legislature is presumed to know principles of statutory construction.
(People vs. Lowell, 230 N. W. 202, 250 Mich. 349, followed in P. vs.
Woodworth, 230 N.W. 211, 250 Mich. 436.).
It is not to be presumed that a provision was inserted in a constitution or
statute without reason, or that a result was intended inconsistent with the
judgment of men of common sense guided by reason" (Mitchell vs. Lawden,
123 N.E. 566, 288 Ill. 326.) See City of Decatur vs. German, 142 N. E. 252, 310
Ill. 591, and may other authorities that can be cited in support hereof.
Consequently, the Constitutional Assembly must have known:
1. That a corporation sole is organized by and composed of a single
individual, the head of any religious society or church operating within the
zone, area or jurisdiction covered by said corporation sole (Article 155, Public
Act No. 1459);
2. That a corporation sole is a non-stock corporation;
3. That the Ordinary ( the corporation sole proper) does not own the
temporalities which he merely administers;
4. That under the law the nationality of said Ordinary or of any administrator
has absolutely no bearing on the nationality of the person desiring to acquire
real property in the Philippines by purchase or other lawful means other than
by hereditary succession, who according to the Constitution must be a
Filipino (sections 1 and 5, Article XIII).
5. That section 159 of the Corporation Law expressly authorized the
corporation sole to purchase and hold real estate for its church, charitable,
benevolent or educational purposes, and to receive bequests or gifts for such
purposes;
6. That in approving our Magna Carta the Delegates to the Constitutional
Convention, almost all of whom were Roman Catholics, could not have
intended to curtail the propagation of the Roman Catholic faith or the
expansion of the activities of their church, knowing pretty well that with the
growth of our population more places of worship, more schools where our
youth could be taught and trained; more hallow grounds where to bury our
dead would be needed in the course of time.
Long before the enactment of our Constitution the law authorized the
corporations sole even to receive bequests or gifts of real estates and this
Court could not, without any clear and specific provision of the Constitution,
declare that any real property donated, let as say this year, could no longer
be registered in the name of the corporation sole to which it was conveyed.
That would be an absurdity that should not receive our sanction on the
pretext that corporations sole which have no nationality and are non-stock
corporations composed of only one person in the capacity of administrator,
have to establish first that at least sixty per centum of their capital belong to
Filipino citizens. The new Civil Code even provides:
ART. 10. — In case of doubt in the interpretation or application of laws, it is
presumed that the lawmaking body intended right and justice to prevail.
Moreover, under the laws of the Philippines, the administrator of the
properties of a Filipino can acquire, in the name of the latter, private lands
without any limitation whatsoever, and that is so because the properties thus
acquired are not for and would not belong to the administrator but to the
Filipino whom he represents. But the dissenting Justice inquires: If the
Ordinary is only the administrator, for whom does he administer? And who
can alter or overrule his acts? We will forthwith proceed to answer these
questions. The corporations sole by reason of their peculiar constitution and
form of operation have no designed owner of its temporalities, although by
the terms of the law it can be safely implied that the Ordinary holds them in
trust for the benefit of the Roman Catholic faithful to their respective locality
or diocese. Borrowing the very words of the law, We may say that the
temporalities of every corporation sole are held in trust for the use, purpose,
behalf and benefit of the religious society, or order so incorporated or of the
church to which the diocese, synod, or district organization is an organized
and constituent part (section 163 of the Corporation Law).
In connection with the powers of the Ordinary over the temporalities of the
corporation sole, let us see now what is the meaning and scope of the word
"control". According to the Merriam-Webster's New International Dictionary,
2nd ed., p. 580, on of the acceptations of the word "control" is:
4. To exercise restraining or directing influence over; to dominate; regulate;
hence, to hold from action; to curb; subject; also, Obs. — to overpower.
SYN: restrain, rule, govern, guide, direct; check, subdue.
It is true that under section 159 of the Corporation Law, the intervention of
the courts is not necessary, to mortgage or sell real property held by the
corporation sole where the rules, regulations and discipline of the religious
denomination, society or church concerned presented by such corporation
sole regulates the methods of acquiring, holding, selling and mortgaging real
estate, and that the Roman Catholic faithful residing in the jurisdiction of the
corporation sole has no say either in the manner of acquiring or of selling
real property. It may be also admitted that the faithful of the diocese cannot
govern or overrule the acts of the Ordinary, but all this does not mean that
the latter can administer the temporalities of the corporation sole without
check or restraint. We must not forget that when a corporation sole is
incorporated under Philippine laws, the head and only member thereof
subjects himself to the jurisdiction of the Philippine courts of justice and
these tribunals can thus entertain grievances arising out of or with respect to
the temporalities of the church which came into the possession of the
corporation sole as administrator. It may be alleged that the courts cannot
intervene as to the matters of doctrine or teachings of the Roman Catholic
Church. That is correct, but the courts may step in, at the instance of the
faithful for whom the temporalities are being held in trust, to check undue
exercise by the corporation sole of its power as administrator to insure that
they are used for the purpose or purposes for which the corporation sole was
created.
American authorities have these to say:
It has been held that the courts have jurisdiction over an action brought by
persons claiming to be members of a church, who allege a wrongful and
fraudulent diversion of the church property to uses foreign to the purposes of
the church, since no ecclesiastical question is involved and equity will protect
from wrongful diversion of the property (Hendryx vs. Peoples United Church,
42 Wash. 336, 4 L.R.A. — n.s. — 1154).
The courts of the State have no general jurisdiction and control over the
officers of such corporations in respect to the performance of their official
duties; but as in respect to the property which they hold for the corporation,
they stand in position of TRUSTEES and the courts may exercise the same
supervision as in other cases of trust (Ramsey vs. Hicks, 174 Ind. 428, 91 N.E.
344, 92 N.E. 164, 30 L.R.A. — n.s. — 665; Hendryx vs. Peoples United
Church, supra.).
Courts of the state do not interfere with the administration of church rules or
discipline unless civil rights become involved and which must be protected
(Morris St., Baptist Church vs. Dart, 67 S.C. 338, 45 S.E. 753, and others). (All
cited in Vol. II, Cooley's Constitutional Limitations, p. 960-964.).
If the Constitutional Assembly was aware of all the facts above enumerated
and of the provisions of law relative to existing conditions as to management
and operation of corporations sole in the Philippines, and if, on the other
hand, almost all of the Delegates thereto embraced the Roman Catholic faith,
can it be imagined even for an instant that when Article XIII of the
Constitution was approved the framers thereof intended to prevent or curtail
from then on the acquisition sole, either by purchase or donation, of real
properties that they might need for the propagation of the faith and for
there religious and Christian activities such as the moral education of the
youth, the care, attention and treatment of the sick and the burial of the
dead of the Roman Catholic faithful residing in the jurisdiction of the
respective corporations sole? The mere indulgence in said thought would
impress upon Us a feeling of apprehension and absurdity. And that is
precisely the leit motiv that permeates the whole fabric of the dissenting
opinion.
It seems from the foregoing that the main problem We are confronted with
in this appeal, hinges around the necessity of a proper and adequate
interpretation of sections 1 and 5 of Article XIII of the Constitution. Let Us
then be guided by the principles of statutory construction laid down by the
authorities on the matter:
The most important single factor in determining the intention of the people
from whom the constitution emanated is the language in which it is
expressed. The words employed are to be taken in their natural sense,
except that legal or technical terms are to be given their technical meaning.
The imperfections of language as a vehicle for conveying meanings result in
ambiguities that must be resolved by result to extraneous aids for
discovering the intent of the framers. Among the more important of these
are a consideration of the history of the times when the provision was
adopted and of the purposes aimed at in its adoption. The debates of
constitutional convention, contemporaneous construction, and practical
construction by the legislative and executive departments, especially if long
continued, may be resorted to resolve, but not to create,
ambiguities. . . . Consideration of the consequences flowing from alternative
constructions of doubtful provisions constitutes an important interpretative
device. . . . The purposes of many of the broadly phrased constitutional
limitations were the promotion of policies that do not lend themselves to
definite and specific formulation. The courts have had to define those policies
and have often drawn on natural law and natural rights theories in doing so.
The interpretation of constitutions tends to respond to changing conceptions
of political and social values. The extent to which these extraneous aids
affect the judicial construction of constitutions cannot be formulated in
precise rules, but their influence cannot be ignored in describing the
essentials of the process (Rottschaeffer on Constitutional Law, 1939 ed., p.
18-19).
There are times that when even the literal expression of legislation may be
inconsistent with the general objectives of policy behind it, and on the basis
of equity or spirit of the statute the courts rationalize a restricted meaning of
the latter. A restricted interpretation is usually applied where the effect of another Delegate to the Constitutional Convention, in his concurring opinion
literal interpretation will make for injustice and absurdity or, in the words of in the case of Goldcreek Mining Co. vs. Eulogio Rodriguez et al., 66 Phil. 259.
one court, the language must be so unreasonable 'as to shock general Anyway the majority of the Court did not deem necessary to pass upon said
common sense'. (Vol. 3, Sutherland on Statutory Construction, 3rd ed., 150.). "vested right saving clause" for the final determination of this case.

A constitution is not intended to be a limitation on the development of a JUDGMENT

country nor an obstruction to its progress and foreign relations (Moscow Fire
Ins. Co. of Moscow, Russia vs. Bank of New York and Trust Co., 294 N. Y.
S.648; 56 N.E. 2d. 745, 293 N.Y. 749).
Although the meaning or principles of a constitution remain fixed and
unchanged from the time of its adoption, a constitution must be construed
as if intended to stand for a great length of time, and it is progressive and not
static. Accordingly, it should not receive too narrow or literal an
interpretation but rather the meaning given it should be applied in such
manner as to meet new or changed conditions as they arise (U.S. vs. Lassic,
313 U.S. 299, 85 L. Ed., 1368).
Effect should be given to the purpose indicated by a fair interpretation of the
language used and that construction which effectuates, rather than that
which destroys a plain intent or purpose of a constitutional provision, is not
only favored but will be adopted (State ex rel. Randolph Country vs. Walden,
206 S.W. 2d 979).
Wherefore, the resolution of the respondent Land Registration Commission
of September 21, 1954, holding that in view of the provisions of sections 1
and 5 of Article XIII of the Philippine Constitution the vendee (petitioner) is
not qualified to acquire lands in the Philippines in the absence of proof that
at least 60 per centum of the capital, properties or assets of the Roman
Catholic Apostolic Administrator of Davao, Inc. is actually owned or
controlled by Filipino citizens, and denying the registration of the deed of
sale in the absence of proof of compliance with such requisite, is hereby
reversed. Consequently, the respondent Register of Deeds of the City of
Davao is ordered to register the deed of sale executed by Mateo L. Rodis in
favor of the Roman Catholic Apostolic Administrator of Davao, Inc., which is
the subject of the present litigation. No pronouncement is made as to costs.
It is so ordered.

It is quite generally held that in arriving at the intent and purpose the
construction should be broad or liberal or equitable, as the better method of
ascertaining that intent, rather than technical (Great Southern Life Ins. Co. vs.
City of Austin, 243 S.W. 778).

All these authorities uphold our conviction that the framers of the
Constitution had not in mind the corporations sole, nor intended to apply
them the provisions of section 1 and 5 of said Article XIII when they passed
and approved the same. And if it were so as We think it is, herein petitioner,
the Roman Catholic Apostolic Administrator of Davao, Inc., could not be
deprived of the right to acquire by purchase or donation real properties for
charitable, benevolent and educational purposes, nor of the right to register
the same in its name with the Register of Deeds of Davao, an indispensable
requisite prescribed by the Land Registration Act for lands covered by the
Torrens system.

We leave as the last theme for discussion the much debated question above
referred to as "the vested right saving clause" contained in section 1, Article
XIII of the Constitution. The dissenting Justice hurls upon the personal
opinion expressed on the matter by the writer of the decision the most
pointed darts of his severe criticism. We think, however, that this strong
dissent should have been spared, because as clearly indicated before, some
members of this Court either did not agree with the theory of the writer or
were not ready to take a definite stand on that particular point, so that there
being no majority opinion thereon there was no need of any dissension
therefrom. But as the criticism has been made the writer deems it necessary
to say a few words of explanation.

The writer fully agrees with the dissenting Justice that ordinarily "a capacity
to acquire (property) in futuro, is not in itself a vested or existing property
right that the Constitution protects from impairment. For a property right to
be vested (or acquired) there must be a transition from the potential or
contingent to the actual, and the proprietary interest must have attached to
a thing; it must have become 'fixed and established'" (Balboa vs. Farrales, 51
Phil. 498). But the case at bar has to be considered as an exception to the
rule because among the rights granted by section 159 of the Corporation Law
was the right to receive bequests or gifts of real properties for charitable,
benevolent and educational purposes. And this right to receive such
bequests or gifts (which implies donations in futuro), is not a mere
G.R. No. L-31956 April 30, 1984
potentiality that could be impaired without any specific provision in the
Constitution to that effect, especially when the impairment would FILOMENA GERONA DE CASTRO, petitioner,
disturbingly affect the propagation of the religious faith of the immense vs.
majority of the Filipino people and the curtailment of the activities of their JOAQUIN TENG QUEEN TAN, TAN TENG BIO, DOLORES TAN, ROSARIO TAN
Church. That is why the writer gave us a basis of his contention what HUA ING, and TO O. HIAP, respondents.
Professor Aruego said in his book "The Framing of the Philippine
Constitution" and the enlightening opinion of Mr. Justice Jose P. Laurel, Pascual G. Mier for petitioner.
Eddie Tamondong for respondent Joaquin Teng Queen Tan.
Carlos Buenviaje for respondent Tan Teng Bio.
Arnulfo L. Perete for respondent Ong Shi (To O. Hiap).
PLANA, J.:ñé+.£ªwph!1
Review on certiorari of the order of the former Court of First Instance of
Sorsogon dismissing petitioner's action for annulment of contract with
damages.
Laches has been defined as the failure or neglect, for an unreasonable and
unexplained length of time, to do that which by exercising due diligence
could or should have been done earlier; it is negligence or omission to assert
a right within a reasonable time, warranting a presumption that the party
entitled to assert it either has abandoned it or declined to assert it. (Tijam, et
al. vs. Sibonghanoy, et al., No. L-21450, April 15, 1968, 23 SCRA 29, 35). (cited
in Sotto vs. Teves, 86 SCRA 154 [1978]).
Respondent, therefore, must be declared to be the rightful owner of the
property. (p. 553.)
WHEREFORE, the appealed order is affirmed. Costs against petitioner.

In 1938, petitioner Filomena Gerona de Castro sold a 1,258 sq. m. residential SO ORDERED.1äwphï1.ñët
lot in Bulan, Sorsogon to Tan Tai, a Chinese. In 1956, Tan Tai died leaving
herein respondents — his widow, To O. Hiap, and children Joaquin Teng
Queen Tan, Tan Teng Bio, Dolores Tan and Rosario Tan Hua Ing.

Before the death of Tan Tai or on August 11, 1956, one of his sons, Joaquin,
became a naturalized Filipino. Six years after Tan Tai's death, or on
November 18, 1962, his heirs executed an extra-judicial settlement of estate
with sale, whereby the disputed lot in its entirety was alloted to Joaquin.

On July 15, 1968, petitioner commenced suit against the heirs of Tan Tai for
annulment of the sale for alleged violation of the 1935 Constitution
prohibiting the sale of land to aliens.

Except for respondent Tan Teng Bio who filed an answer to the complaint,
respondents moved to dismiss the complaint on the grounds of (a) lack of
cause of action, the plaintiff being in pari delicto with the vendee, and the
land being already owned by a Philippine citizen; (b) laches; and (c)
acquisitive prescription.

Over the opposition of petitioner, the court a quo dismissed the complaint,

sustaining the first two grounds invoked by the movants. It is this order of
dismissal that is now the subject of this review.

The assailed order must be sustained.

Independently of the doctrine of pari delicto, the petitioner cannot have the

sale annulled and recover the lot she herself has sold. While the vendee was
an alien at the time of the sale, the land has since become the property, of
respondent Joaquin Teng, a naturalized Philippine citizen, who is
constitutionally qualified to own land.têñ.£îhqwâ£

... The litigated property is now in the hands of a naturalized Filipino. It is no

longer owned by a disqualified vendee. Respondent, as a naturalized citizen,
was constitutionally qualified to own the subject property. There would be
no more public policy to be served in allowing petitioner Epifania to recover
the land as it is already in the hands of a qualified person. Applying by
analogy the ruling of this Court in Vasquez vs. Giap and Li Seng Giap &
Sons:têñ.£îhqwâ£

... if the ban on aliens from acquiring not only agricultural but also urban
lands, as construed by this Court in the Krivenko case, is to preserve the
nation's lands for future generations of Filipinos, that aim or purpose would
not be thwarted but achieved by making lawful the acquisition of real estate
by aliens who became Filipino citizens by naturalization. (Sarsosa Vda. de
Barsobia vs. Cuenco, 113 SCRA 547, at 553.)

Laches also militates against petitioner's cause. She sold the disputed lot in
1938. She instituted the action to annul the sale only on July 15, 1968. What
the Court said in the cited Sarsosa case applies with equal force to the
petitioner.têñ.£îhqwâ£
G.R. No. 74170 July 18, 1989
... it is likewise inescapable that petitioner Epifania had slept on her rights for
26 years from 1936 to 1962. By her long inaction of inexcusable neglect, she REPUBLIC OF THE PHILIPPINES, petitioner,
should be held barred from asserting her claim to the litigated property vs.
(Sotto vs. Teves, 86 SCRA 157 [1978]).têñ.£îhqw⣠INTERMEDIATE APPELLATE COURT, GUILLERMO
GONZALVES,** respondents.
Amando Fabio Jr. for private respondent.
NARVASA, J.:
The chief question presented in the appeal at bar concerns the validity of a
conveyance of residential land to an alien prior to his acquisition of Filipino
citizenship by naturalization.
The Trial Court's description of the factual background is largely undisputed.
The case principally concerns Chua Kim @ Uy Teng Be, who became a
naturalized Filipino citizen, taking his oath as such, on January 7,1977. 1 He
was the adopted son of Gregorio Reyes Uy Un.
The case involved three (3) parcels of land, which were among those
included in Land Registration Cases Numbered 405 and 14817 of the Court of
First Instance of Quezon Province: Lots Numbered 1 and 2, plan Psu-
57676, 2 and Lot No. 549 of plan AP-7521-identical to Plan Psu-54565. 3 These
were respectively adjudicated in said land registration cases to two persons,
as follows:
1) Lots 1 and 2, Psu-57676, to the Spouses Benigno Mañosca and Julia
Daguison (in Opposition No. 51 ); 4 and
2) Lot 549, AP-7521 (Psu-54565), to Gaspar Marquez, married to Marcela
Masaganda (in opposition No. 155). 5 However, no decree of confirmation
and registration was entered at the time.
Lots 1 and 2, Psu-57676, were sold by the owners, the Mañosca Spouses, to
Gregorio Reyes Uy Un on Dec. 30, 1934. 6 Lot 549, Psu-54565, was also sold
by the Marquez Spouses to Gregorio Reyes Uy Un on December 27, 1934. 7
Subsequently, Gregorio Reyes Uy Un died, and his adopted son, Chua Kim @
Uy Teng, took possession of the property.
The three (3) parcels of land above mentioned, together with several others,
later became subject of a compromise agreement in a litigation in the Court
of First Instance of Quezon Province, docketed as Civil Case No. C-385. 8 The
compromise agreement was executed not only by the parties in the case
(plaintiffs Domingo Reyes and Lourdes Abustan, and the defendants, So Pick,
et al.) — respectively described as "First Parties" and "Second Parties"-but
also Chua Kim @ Ting Be Uy, designated therein as "Third Party," although
he had not been impleaded as a party to the case. In the agreement, in
consideration of Chua Kim's renunciation (a) of "any right or claim of
whatever nature in .. (certain specifically identified) parcels of land" and (b)
of any other claim against the First Parties and Second Parties, both the
latter, in turn waived "any claim of ownership or other right in or to the
parcels of land, or the improvements thereon, in Buenavista, Quezon
covered by OCT Nos. 3697, 3696, 3439 and 4382 of the Registry of Deeds of
Quezon," in the name of Gregorio Reyes Uy Un, Chua Kim's adoptive father,
and that they (the First and Second Parties) "will not oppose the transfer, by
means not contrary to law, of the ownership thereof to the Third Party," said
Chua Kim. The compromise agreement was afterwards submitted to the
Court 9 which rendered judgment on July 29,1970 (amended by Order dated
July 31, 1970), approving the same. 10
Chua Kim then filed a petition for issuance of decree of confirmation and
registration in Land Registration Case No. 405 (LRC Rec. No. 14817) of the
Court of First Instance of Quezon Province.11
After due proceedings, and on the basis of the foregoing facts found to have
been duly proven by the evidence, the Court of First Instance of
Quezon 12 promulgated on January 14, 1982 the following Order, to wit:
WHEREFORE, premises considered, this Court finds that herein petitioner
Chua Kim alias Uy Teng Be has duly established his registerable title over the
properties in question in this land registration case in so far as Oppositions
Nos. 51 and 155 are concerned, and hereby GRANTS his petition. The
decision rendered on January 14, 1933 in so far as Opposition Nos. 51 and
155 are concerned, is hereby amended adjudicating the said properties,
better known now as Lots 1 and 2 of plan Psu-57676 in Opposition No. 51
and as Lot.549 of plan Ap-7521, which is Identical to plan Psu-54565 in
Opposition No. 155, to herein petitioner Chua Kim alias Uy Teng Be. Upon
this order becoming final, let the corresponding decrees of confirmation and
registration be entered and thereafter upon payment of the fees required by
law, let the corresponding certificate of titles be issued in the name of
petitioner, Chua Kim alias Uy Teng Be, married to Amelia Tan, of legal age, a
naturalized Filipino citizen, and a resident of the Municipality of Buenavista,
Province of Quezon, as his own exclusive properties, free from all liens and
encumbrances.
SO ORDERED.
The Republic of the Philippines, through the Solicitor General, challenged the
correctness of the Order and appealed it to the Court of Appeals. That Court,
however, affirmed the Order "in all respects," in a decision promulgated on
March 25,1986. 13
Still not satisfied, the Republic has come to this Court on appeal by certiorari,
in a final attempt to prevent the adjudication of the property in question to
Chua Kim. The Solicitor General argues that —
1) the deeds and instruments presented by Chua Kim to prove the
conveyance to him of the lands in question by the successor-in- interest of
the original adjudicates are inadequate for the purpose; and
2) Chua Kim has not proven his qualification to own private agricultural land
at the time of the alleged acquisition of the property in question.
The Republic's theory is that the conveyances to Chua Kim were made while
he was still an alien, i.e., prior to his taking oath as a naturalized Philippine
citizen on January 7, 1977, at a time when he was disqualified to acquire
ownership of land in the Philippines (ART XIII, SEC. 5, 1935 Constitution; ART.
XIV, Sec. 14, 1973 Constitution); hence, his asserted titles are null and
void. 14 It is also its contention that reliance on the decision and amendatory
order in Civil Case No. C-385 of the CFI, Rizal15 is unavailing, since neither
document declares that the property in question was adjudicated to Chua
Kim as his inheritance from his adoptive father, Gregorio Reyes Uy Un. 16
The conclusions of fact of the Intermediate Appellate Court, sustaining those
of the Land Registration Court, reached after analysis and assessment of the
evidence presented at a formal hearing by the parties, are by firmly
entrenched rule binding on and may not be reviewed by this Court. 17 Those
facts thus found to exist, and the legal principles subsumed in them, impel
rejection of the Republic's appeal.
It is a fact that the lands in dispute were properly and formally adjudicated
by a competent Court to the Spouses Gaspar and to the Spouses Marquez in
fee simple, and that the latter had afterwards conveyed said lands to
Gregorio Reyes Uy Un, Chua Kim's adopting parent, by deeds executed in due
form on December 27, 1934 and December 30, 1934, respectively. Plainly,
the conveyances were made before the 1935 Constitution went into effect,
i.e., at a time when there was no prohibition against acquisition of private
agricultural lands by aliens. 18 Gregorio Reyes Uy Un therefore acquired good
title to the lands thus purchased by him, and his ownership was not at all
affected either (1) by the principle subsequently enunciated in the 1935
Constitution that aliens were incapacitated to acquire lands in the country,
since that constitutional principle has no retrospective application,19 or (2) by
his and his successor's omission to procure the registration of the property
prior to the coming into effect of the Constitution. 20
It is a fact, furthermore, that since the death of Gregorio Reyes Uy Un in San
Narciso, Quezon, in 1946, Chua Kim @ Uy Teng Be had been in continuous
possession of the lands in concept of owner, as the putative heir of his
adoptive father, said Gregorio Reyes; 21 this, without protest whatever from
any person. It was indeed Chua Kim's being in possession of the property in
concept of owner, and his status as adopted son of Gregorio Reyes, that
were the factors that caused his involvement in Civil Case No. C-385 of the
CFI at Calauag, Quezon, at the instance of the original parties thereto, 22 and
his participation in the Compromise Agreement later executed by all parties.
As already mentioned, that compromise agreement, approved by judgment
rendered on July 29, 1970, 23 implicity recognized Chua Kim's title to the
lands in question.

Be this as it may, the acquisition by Chua Kim of Philippine citizenship should

foreclose any further debate regarding the title to the property in
controversy, in line with this Court's rulings relative to persons similarly
situated. 24 In Sarsosa Vda. de Barsobia v. Cuenco, 113 SCRA 547, for
instance, the ruling was as follows:

... The litigated property is now in the hands of a naturalized Filipino. It is no

longer owned by a disqualified vendee. Respondent, as a naturalized citizen,
was constitutionally qualified to own the subject property. There would be
no more public policy to be served in allowing petitioner Epifania to recover
the land as it is already in the hands of a qualified person. Applying by
analogy the ruling of this Court in Vasquez vs. Giap and Li Seng Giap &
Sons (96 Phil. 447 [1955]),

... if the ban on aliens from acquiring not only agricultural but also urban
lands, as construed by this Court in the Krivenko case, is to preserve the
nation's land for future generations of Filipinos, that aim or purpose would
not be thwarted but achieved by making lawful the acquisition of real estate
by aliens who became Filipino citizens by naturalization.

WHEREFORE, the petition is DISMISSED, and the judgment of the

Intermediate Appellate Court subject thereof AFFIRMED in toto. SO
ORDERED.

G.R. No. 164584               June 22, 2009

PHILIP MATTHEWS, Petitioner,
vs.
BENJAMIN A. TAYLOR and JOSELYN C. TAYLOR, Respondents.

DECISION
NACHURA, J.:
Assailed in this petition for review on certiorari are the Court of Appeals (CA)
December 19, 2003 Decision1 and July 14, 2004 Resolution2 in CA-G.R. CV No.
59573. The assailed decision affirmed and upheld the June 30, 1997
Decision3 of the Regional Trial Court (RTC), Branch 8, Kalibo, Aklan in Civil
Case No. 4632 for Declaration of Nullity of Agreement of Lease with
Damages.
On June 30, 1988, respondent Benjamin A. Taylor (Benjamin), a British
subject, married Joselyn C. Taylor (Joselyn), a 17-year old Filipina.4 On June 9,
1989, while their marriage was subsisting, Joselyn bought from Diosa M.
Martin a 1,294 square-meter lot (Boracay property) situated at Manoc-
Manoc, Boracay Island, Malay, Aklan, for and in consideration of
₱129,000.00.5 The sale was allegedly financed by Benjamin.6 Joselyn and
Benjamin, also using the latter’s funds, constructed improvements thereon
and eventually converted the property to a vacation and tourist resort known
as the Admiral Ben Bow Inn.7 All required permits and licenses for the
operation of the resort were obtained in the name of Ginna Celestino,
Joselyn’s sister.8
However, Benjamin and Joselyn had a falling out, and Joselyn ran away with
Kim Philippsen. On June 8, 1992, Joselyn executed a Special Power of
Attorney (SPA) in favor of Benjamin, authorizing the latter to maintain, sell,
lease, and sub-lease and otherwise enter into contract with third parties with
respect to their Boracay property.9
On July 20, 1992, Joselyn as lessor and petitioner Philip Matthews as lessee,
entered into an Agreement of Lease10 (Agreement) involving the Boracay
property for a period of 25 years, with an annual rental of ₱12,000.00. The
agreement was signed by the parties and executed before a Notary Public.
Petitioner thereafter took possession of the property and renamed the resort
as Music Garden Resort.1avvphi1
Claiming that the Agreement was null and void since it was entered into by
Joselyn without his (Benjamin’s) consent, Benjamin instituted an action for
Declaration of Nullity of Agreement of Lease with Damages11 against Joselyn
and the petitioner. Benjamin claimed that his funds were used in the
acquisition and improvement of the Boracay property, and coupled with the
fact that he was Joselyn’s husband, any transaction involving said property
required his consent.
No Answer was filed, hence, the RTC declared Joselyn and the petitioner in
defeault. On March 14, 1994, the RTC rendered judgment by default
declaring the Agreement null and void.12 The decision was, however, set
aside by the CA in CA-G.R. SP No. 34054.13 The CA also ordered the RTC to
allow the petitioner to file his Answer, and to conduct further proceedings.
In his Answer,14 petitioner claimed good faith in transacting with Joselyn.
Since Joselyn appeared to be the owner of the Boracay property, he found it
unnecessary to obtain the consent of Benjamin. Moreover, as appearing in
the Agreement, Benjamin signed as a witness to the contract, indicating his
knowledge of the transaction and, impliedly, his conformity to the
agreement entered into by his wife. Benjamin was, therefore, estopped from
questioning the validity of the Agreement.
There being no amicable settlement during the pre-trial, trial on the merits
ensued.
On June 30, 1997, the RTC disposed of the case in this manner:
WHEREFORE, premises considered, judgment is hereby rendered in favor of
the plaintiff and against the defendants as follows:
1. The Agreement of Lease dated July 20, 1992 consisting of eight (8) pages
(Exhibits "T", "T-1", "T-2", "T-3", "T-4", "T-5", "T-6" and "T-7") entered into by
and between Joselyn C. Taylor and Philip Matthews before Notary Public
Lenito T. Serrano under Doc. No. 390, Page 79, Book I, Series of 1992 is
hereby declared NULL and VOID;
2. Defendants are hereby ordered, jointly and severally, to pay plaintiff the
sum of SIXTEEN THOUSAND (₱16,000.00) PESOS as damages representing
unrealized income for the residential building and cottages computed
monthly from July 1992 up to the time the property in question is restored to
plaintiff; and
3. Defendants are hereby ordered, jointly and severally, to pay plaintiff the
sum of TWENTY THOUSAND (₱20,000.00) PESOS, Philippine Currency, for
attorney’s fees and other incidental expenses.
SO ORDERED.15
The RTC considered the Boracay property as community property of
Benjamin and Joselyn; thus, the consent of the spouses was necessary to
validate any contract involving the property. Benjamin’s right over the
Boracay property was bolstered by the court’s findings that the property was
purchased and improved through funds provided by Benjamin. Although the
Agreement was evidenced by a public document, the trial court refused to
consider the alleged participation of Benjamin in the questioned transaction
primarily because his signature appeared only on the last page of the
document and not on every page thereof.
On appeal to the CA, petitioner still failed to obtain a favorable decision. In
its December 19, 2003 Decision,16 the CA affirmed the conclusions made by
the RTC. The appellate court was of the view that if, indeed, Benjamin was a
willing participant in the questioned transaction, the parties to the
Agreement should have used the phrase "with my consent" instead of
"signed in the presence of." The CA noted that Joselyn already prepared an
SPA in favor of Benjamin involving the Boracay property; it was therefore
unnecessary for Joselyn to participate in the execution of the Agreement.
Taken together, these circumstances yielded the inevitable conclusion that
the contract was null and void having been entered into by Joselyn without
the consent of Benjamin.
Aggrieved, petitioner now comes before this Court in this petition for review
on certiorari based on the following grounds:
4.1. THE MARITAL CONSENT OF RESPONDENT BENJAMIN TAYLOR IS NOT
REQUIRED IN THE AGREEMENT OF LEASE DATED 20 JULY 1992. GRANTING
ARGUENDO THAT HIS CONSENT IS REQUIRED, BENJAMIN TAYLOR IS DEEMED
TO HAVE GIVEN HIS CONSENT WHEN HE AFFIXED HIS SIGNATURE IN THE
AGREEMENT OF LEASE AS WITNESS IN THE LIGHT OF THE RULING OF THE
SUPREME COURT IN THE CASE OF SPOUSES PELAYO VS. MELKI PEREZ, G.R.
NO. 141323, JUNE 8, 2005.
4.2. THE PARCEL OF LAND SUBJECT OF THE AGREEMENT OF LEASE IS THE
EXCLUSIVE PROPERTY OF JOCELYN C. TAYLOR, A FILIPINO CITIZEN, IN THE
LIGHT OF CHEESMAN VS. IAC, G.R. NO. 74833, JANUARY 21, 1991.
4.3. THE COURTS A QUO ERRONEOUSLY APPLIED ARTICLE 96 OF THE FAMILY
CODE OF THE PHILIPPINES WHICH IS A PROVISION REFERRING TO THE
ABSOLUTE COMMUNITY OF PROPERTY. THE PROPERTY REGIME GOVERNING
THE PROPERTY RELATIONS OF BENJAMIN TAYLOR AND JOSELYN TAYLOR IS
THE CONJUGAL PARTNERSHIP OF GAINS BECAUSE THEY WERE MARRIED ON
30 JUNE 1988 WHICH IS PRIOR TO THE EFFECTIVITY OF THE FAMILY CODE.
ARTICLE 96 OF THE FAMILY CODE OF THE PHILIPPINES FINDS NO
APPLICATION IN THIS CASE.
4.4. THE HONORABLE COURT OF APPEALS IGNORED THE PRESUMPTION OF
REGULARITY IN THE EXECUTION OF NOTARIAL DOCUMENTS.
4.5. THE HONORABLE COURT OF APPEALS FAILED TO PASS UPON THE
COUNTERCLAIM OF PETITIONER DESPITE THE FACT THAT IT WAS NOT
CONTESTED AND DESPITE THE PRESENTATION OF EVIDENCE ESTABLISHING
SAID CLAIM.17
The petition is impressed with merit.
In fine, we are called upon to determine the validity of an Agreement of
Lease of a parcel of land entered into by a Filipino wife without the consent
of her British husband. In addressing the matter before us, we are confronted
not only with civil law or conflicts of law issues, but more importantly, with a
constitutional question.
It is undisputed that Joselyn acquired the Boracay property in 1989. Said
acquisition was evidenced by a Deed of Sale with Joselyn as the vendee. The
property was also declared for taxation purposes under her name. When
Joselyn leased the property to petitioner, Benjamin sought the nullification of
the contract on two grounds: first, that he was the actual owner of the
property since he provided the funds used in purchasing the same; and
second, that Joselyn could not enter into a valid contract involving the
subject property without his consent.
The trial and appellate courts both focused on the property relations of
petitioner and respondent in light of the Civil Code and Family Code
provisions. They, however, failed to observe the applicable constitutional
principles, which, in fact, are the more decisive.
Section 7, Article XII of the 1987 Constitution states:18
Section 7. Save in cases of hereditary succession, no private lands shall be
transferred or conveyed except to individuals, corporations, or associations
qualified to acquire or hold lands of the public domain.1avvphi1
Aliens, whether individuals or corporations, have been disqualified from
acquiring lands of the public domain. Hence, by virtue of the aforecited
constitutional provision, they are also disqualified from acquiring private
lands.19 The primary purpose of this constitutional provision is the
conservation of the national patrimony.20 Our fundamental law cannot be
any clearer. The right to acquire lands of the public domain is reserved only
to Filipino citizens or corporations at least sixty percent of the capital of
which is owned by Filipinos.21
In Krivenko v. Register of Deeds,22 cited in Muller v. Muller,23 we had the
occasion to explain the constitutional prohibition:
Under Section 1 of Article XIII of the Constitution, "natural resources, with
the exception of public agricultural land, shall not be alienated," and with
respect to public agricultural lands, their alienation is limited to Filipino
citizens. But this constitutional purpose conserving agricultural resources in
the hands of Filipino citizens may easily be defeated by the Filipino citizens
themselves who may alienate their agricultural lands in favor of aliens. It is
partly to prevent this result that Section 5 is included in Article XIII, and it
reads as follows:
"Section 5. Save in cases of hereditary succession, no private agricultural land
will be transferred or assigned except to individuals, corporations, or
associations qualified to acquire or hold lands of the public domain in the
Philippines."
This constitutional provision closes the only remaining avenue through which
agricultural resources may leak into alien’s hands. It would certainly be futile
to prohibit the alienation of public agricultural lands to aliens if, after all, they
may be freely so alienated upon their becoming private agricultural lands in
the hands of Filipino citizens. x x x
xxxx
If the term "private agricultural lands" is to be construed as not including
residential lots or lands not strictly agricultural, the result would be that
"aliens may freely acquire and possess not only residential lots and houses
for themselves but entire subdivisions, and whole towns and cities," and that
"they may validly buy and hold in their names lands of any area for building
homes, factories, industrial plants, fisheries, hatcheries, schools, health and
vacation resorts, markets, golf courses, playgrounds, airfields, and a host of
other uses and purposes that are not, in appellant’s words, strictly
agricultural." (Solicitor General’s Brief, p. 6) That this is obnoxious to the
conservative spirit of the Constitution is beyond question.24
The rule is clear and inflexible: aliens are absolutely not allowed to acquire
public or private lands in the Philippines, save only in constitutionally
recognized exceptions.25 There is no rule more settled than this constitutional
prohibition, as more and more aliens attempt to circumvent the provision by
trying to own lands through another. In a long line of cases, we have settled
issues that directly or indirectly involve the above constitutional provision.
We had cases where aliens wanted that a particular property be declared as
part of their father’s estate;26 that they be reimbursed the funds used in
purchasing a property titled in the name of another;27 that an implied trust
be declared in their (aliens’) favor;28 and that a contract of sale be nullified
for their lack of consent.29
In Ting Ho, Jr. v. Teng Gui,30 Felix Ting Ho, a Chinese citizen, acquired a parcel
of land, together with the improvements thereon. Upon his death, his heirs
(the petitioners therein) claimed the properties as part of the estate of their
deceased father, and sought the partition of said properties among
themselves. We, however, excluded the land and improvements thereon
from the estate of Felix Ting Ho, precisely because he never became the
owner thereof in light of the above-mentioned constitutional prohibition.
In Muller v. Muller,31 petitioner Elena Buenaventura Muller and respondent
Helmut Muller were married in Germany. During the subsistence of their
marriage, respondent purchased a parcel of land in Antipolo City and
constructed a house thereon. The Antipolo property was registered in the
name of the petitioner. They eventually separated, prompting the
respondent to file a petition for separation of property. Specifically,
respondent prayed for reimbursement of the funds he paid for the
acquisition of said property. In deciding the case in favor of the petitioner,
the Court held that respondent was aware that as an alien, he was prohibited
from owning a parcel of land situated in the Philippines. He had, in fact,
declared that when the spouses acquired the Antipolo property, he had it
titled in the name of the petitioner because of said prohibition. Hence, we
denied his attempt at subsequently asserting a right to the said property in
the form of a claim for reimbursement. Neither did the Court declare that an
implied trust was created by operation of law in view of petitioner’s marriage
to respondent. We said that to rule otherwise would permit circumvention of
the constitutional prohibition.
In Frenzel v. Catito,32 petitioner, an Australian citizen, was married to Teresita
Santos; while respondent, a Filipina, was married to Klaus Muller. Petitioner
and respondent met and later cohabited in a common-law relationship,
during which petitioner acquired real properties; and since he was
disqualified from owning lands in the Philippines, respondent’s name
appeared as the vendee in the deeds of sale. When their relationship turned
sour, petitioner filed an action for the recovery of the real properties
registered in the name of respondent, claiming that he was the real owner.
Again, as in the other cases, the Court refused to declare petitioner as the
owner mainly because of the constitutional prohibition. The Court added that
being a party to an illegal contract, he could not come to court and ask to
have his illegal objective carried out. One who loses his money or property by
knowingly engaging in an illegal contract may not maintain an action for his
losses.
Finally, in Cheesman v. Intermediate Appellate Court,33 petitioner (an
American citizen) and Criselda Cheesman acquired a parcel of land that was
later registered in the latter’s name. Criselda subsequently sold the land to a
third person without the knowledge of the petitioner. The petitioner then
sought the nullification of the sale as he did not give his consent thereto. The
Court held that assuming that it was his (petitioner’s) intention that the lot in
question be purchased by him and his wife, he acquired no right whatever
over the property by virtue of that purchase; and in attempting to acquire a
right or interest in land, vicariously and clandestinely, he knowingly violated
the Constitution; thus, the sale as to him was null and void.
In light of the foregoing jurisprudence, we find and so hold that Benjamin has
no right to nullify the Agreement of Lease between Joselyn and petitioner.
Benjamin, being an alien, is absolutely prohibited from acquiring private and
public lands in the Philippines. Considering that Joselyn appeared to be the
designated "vendee" in the Deed of Sale of said property, she acquired sole
ownership thereto. This is true even if we sustain Benjamin’s claim that he
provided the funds for such acquisition. By entering into such contract
knowing that it was illegal, no implied trust was created in his favor; no
reimbursement for his expenses can be allowed; and no declaration can be
made that the subject property was part of the conjugal/community
property of the spouses. In any event, he had and has no capacity or
personality to question the subsequent lease of the Boracay property by his
wife on the theory that in so doing, he was merely exercising the prerogative
of a husband in respect of conjugal property. To sustain such a theory would
countenance indirect controversion of the constitutional prohibition. If the
property were to be declared conjugal, this would accord the alien husband a
substantial interest and right over the land, as he would then have a decisive
vote as to its transfer or disposition. This is a right that the Constitution does
not permit him to have.34

In fine, the Agreement of Lease entered into between Joselyn and petitioner
cannot be nullified on the grounds advanced by Benjamin. Thus, we uphold
its validity.

With the foregoing disquisition, we find it unnecessary to address the other

issues raised by the petitioner.

WHEREFORE, premises considered, the December 19, 2003 Decision and July
14, 2004 Resolution of the Court of Appeals in CA-G.R. CV No. 59573, are
REVERSED and SET ASIDE and a new one is entered DISMISSING the
complaint against petitioner Philip Matthews.

SO ORDERED.

G.R. No. L-1411             September 29, 1953

DIONISIO RELLOSA, petitioner,
vs.
GAW CHEE HUN, respondent.
Macapagal & Eusebio and Conrado Manalansan for petitioner. aliens may not acquire private or public agricultural lands, including
Alafriz & Alafriz for respondent. Quisumbing, Sycip & Quisumbing as amici residential lands." This matter has been once more submitted to the court for
curiae. deliberation, but the ruling was reaffirmed. This ruling fully disposes of the
question touching on the validity of the sale of the property herein involved.
BAUTISTA ANGELO, J.:
The sale in question having been entered into a violation of the Constitution,
This is a petition for review of a decision of the Court of Appeals holding that the next question to be determined is, can petition have the sale declared
the sale in question is valid and, even if it were invalid, plaintiff cannot null and void and recover the property considering the effect of the law
maintain the action under the principle of pari delicto. governing rescission of contracts? Our answer must of necessity be in the
negative following the doctrine laid down in the case of Trinidad Gonzaga de
On February 2, 1944, Dionisio Rellosa sold to Gaw Chee Hun a parcel of land,
Cabauatan, et al. vs. Uy Hoo, et al., 88 Phil., 103, wherein we made the
together with the house erected thereon, situated in the City of Manila,
following pronouncement: "We can, therefore, say that even if the plaintiffs
Philippines, for the sum of P25,000. The vendor remained in possession of
can still invoke the Constitution, or the doctrine in the Krivenko Case, to set
the property under a contract of lease entered into on the same date
aside the sale in question, they are now prevented from doing so if their
between the same parties. Alleging that the sale was executed subject to the
purpose is to recover the lands that they have voluntarily parted with,
condition that the vendee. being a Chinese citizen, would obtain the approval
because of their guilty knowledge that what they were doing was in violation
of the Japanese Military Administration in accordance with (seirei) No. 6
of the Constitution. They cannot escape this conclusion because they are
issued on April 2, 1943, by the Japanese authorities, and said approval has
presumed to know the law. As this court well said: 'A party to an illegal
not been obtained, and that, even if said requirement were met, the sale
contract cannot come into a court of law and ask to have his illegal objects
would at all events be void under article XIII, section 5, of our Constitution,
carried out. The law will not aid either party to an illegal agreement; it leaves
the vendor instituted the present action in the Court of First Instance of
the parties where it finds them.' The rule is expressed in the maxims: 'Ex dolo
Manila seeking the annulment of the sale as well as the lease covering the
malo non oritur actio,' and 'In pari delicto potior est conditio
land and the house above mentioned, and praying that, once the sale and
defendentis' (Bough and Bough vs. Cantiveros and Hanopol, 40 Phil., 210,
the lease are declared null and void, the vendee be ordered to return to
216.)".
vendor the duplicate of the title covering the property, and be restrained
from in any way dispossessing the latter of said property. The doctrine above adverted to is the one known as In Pari Delicto. This is
well known not only in this jurisdiction but also in the United States where
Defendant answered the complaint setting up as special defense that the
common law prevails. In the latter jurisdiction, the doctrine is state thus:
sale referred to in the complaint was absolute and unconditional and was in
"The propsosition is universal that no action arises, in equity or at law, from
every respect valid and binding between the parties, it being not contrary to
an illegal contract; no suit can be maintained for its specific performance, or
law, morals and public order, and that plaintiff is guilty of estoppel in that, by
to recover the property agreed to be sold or delivered, or the money agreed
having executed a deed of lease over the property, he thereby recognized
to be paid, or damages for its violation. The rule has sometimes been laid
the title of defendant to that property.
down as though it were equally universal, that where the parties are in pari
Issues having been joined, and the requisite evidence presented by both delicto, no affirmative relief of any kind will be given to one against the
parties, the court declared both the sale and the lease valid and binding and other." (Pomeroy's Equity Jurisprudence, Vol. 3, 5th ed., p. 728.).
dismissed the complaint. The court likewise ordered plaintiff to turn over the
It is true that this doctrine is subject to one important limitation, namely,
property to defendant and to pay a rental of P50 a month from August 1,
"whenever public policy is considered as advanced by allowing either party to
1945 until the property has been actually delivered. As this decision was
use for relief against the transaction" (idem, p. 733). But not all contracts
affirmed in toto by the Court of Appeals, plaintiff sued out the present
which are illegal because opposed to public policy come under this limitation.
petition for review.
The cases in which this limitation may apply only "include the class of
One of the issues raised by petitioner refers to the validity of Seirei No. 6 contracts which are intrinsically contrary to public policy, — contracts in
issued on April 2, 1943 by the Japanese authorities which prohibits an alien which the illegality itself consists in their opposition to public policy, and any
from acquiring any private land not agricultural in nature during the other species of illegal contracts in which, from their particular
occupation unless the necessary approval is obtained from the Director circumstances, incidental and collateral motives of public policy require
General of the Japanese Military Administration. Petitioner contends that the relief." Examples of this class of contracts are usurious contracts, marriage-
sale in question cannot have any validity under the above military directive in brokerage contracts and gambling contracts. (Idem. pp. 735-737.).
view of the failure of respondent to obtain the requisite approval and it was
In our opinion, the contract in question does not come under this exception
error for the Court of Appeals to declare said directive without any binding
because it is not intrinsically contrary to public policy, nor one where the
effect because the occupation government could not have issued it under
illegality itself consist in its opposition to public policy. It is illegal not because
article 43 of the Hague Regulations which command that laws that are
it is against public policy but because it is against the Constitution. Nor may it
municipal in character of an occupied territory should be respected and
be contended that to apply the doctrine of pari delicto would be tantamount
cannot be ignored unless prevented by military necessity.
to contravening the fundamental policy embodied in the constitutional
We do not believe it necessary to consider now the question relative to the prohibition in that it would allow an alien to remain in the illegal possession
validity of Seirei No. 6 of the Japanese Military Administration for the simple of the land, because in this case the remedy is lodged elsewhere. To adopt
reason that in our opinion the law that should govern the particular the contrary view would be merely to benefit petitioner and not to enhance
transaction is not the above directive but the Constitution adopted by the public interest.
then Republic of the Philippines on September 4, 1943, it appearing that the
The danger foreseen by counsel in the application of the doctrine above
aforesaid transaction was executed on February 2, 1944. Said Constitution, in
adverted to is more apparent than real. If we go deeper in the analysis of our
its article VIII, section 5, provides that "no private agricultural land shall be
situation we would not fail to see that the best policy would be for Congress
transferred or assigned except to individuals, corporations, or associations
to approve a law laying down the policy and the procedure to be followed in
qualified to acquire or hold lands of the public domain in the Philippines",
connection with transactions affected by our doctrine in the Krivenko case.
which provisions are similar to those contained in our present Constitution.
We hope that this should be done without much delay. And even if this
As to whether the phrase "private agricultural land" employed in said
legislation be not forthcoming in the near future, we do not believe that
Constitution includes residential lands, as the one involved herein, there can
public interest would suffer thereby if only our executive department would
be no doubt because said phrase has already been interpreted in the
follow a more militant policy in the conservation of our natural resources as
affirmative sense by this court in the recent case of Krivenko vs. Register of
ordained by our Constitution. And we say so because there are at present
Deeds, 79 Phil. 461, wherein this court held that "under the Constitution
two ways by which this situation may be remedied, to wit, (1) action for
reversion, and (2) escheat to the state. An action for reversion is slightly
different from escheat proceeding, but in its effects they are the same. They
only differ in procedure. Escheat proceedings may be instituted as a
consequence of a violation of article XIII, section 5 of our Constitution, which
prohibits transfers of private agricultural lands to aliens, whereas an action
for reversion is expressly authorized by the Public Land Act (sections 122,
123, and 124 of Commonwealth Act No. 141).
In the United States, as almost everywhere else, the doctrine which imputes
to the sovereign or to the government the ownership of all lands and makes
such sovereign or government the original source of private titles, is well
recognized (42 Am. Jur., 785). This doctrine, which was expressly affirmed
in Lawrence vs. Garduno, G. R. No. 16542, and which underlies all titles in the
Philippines, (See Ventura, Land Registration and Mortgages, 2nd ed., pp. 2-3)
has been enshrined in our Constitution (Article XIII). The doctrine regarding
the course of all titles being the same here as in the United States, it would
seem that if escheat lies against aliens holding lands in those states of the
Union where common law prevails or where similar constitutional or
statutory prohibitions exists, no cogent reason is perceived why similar
proceedings may not be instituted in this jurisdiction.
Escheat is an incident or attribute of sovereignty, and rests on the principle
of the ultimate ownership by the state of all property within its jurisdiction.
(30 C.J.S., 1164.)1âwphïl.nêt
... In American escheats belongs universally to the state or some corporation
thereof as the ultimate proprietor of land within its Jurisdiction. (19 Am. Jur.,
382.)
An escheat is nothing more or less than the reversion of property to the
state, which takes place when the title fails. (Delany vs. State, 42 N. D., 630,
174 N.W., 290, quoted in footnote 6, 19 Am. Jur., 381.)
so capacitated within the precise period of five years; otherwise, such
property shall revert to the Government.
Sec. 124. Any acquisition, conveyance, alienation, transfer, or other contract
made or executed in violation of any of the provisions of sections one
hundred and eighteen, one hundred and twenty, one hundred and twenty-
one, one hundred and twenty-two, and one hundred and twenty-three of
this Act shall be unlawful and null and void from its execution and shall
produce the effect of annulling and cancelling the grant, title, patent, or
permit originally issued, recognized or confirmed, actually or
presumptively, and cause the reversion of the property and its improvements
to the State.
Note that the last quoted provision declared any prohibited conveyance not
only unlawful but null and void ab initio. More important yet, it expressly
provided that such conveyances will produce "the effect of annulling and
cancelling the grant, title, patent, or permit, originally issued, recognized of
confirmed, actually or presumptively", and of causing "the reversion of the
property and its improvements to the State." The reversion would seems to
be but a consequence of the annulment and cancellation of the original grant
or title, and this is so for in the event of such annulment or cancellation no
one else could legitimately claim the property except its original owner or
grantor — the state.
We repeat. There are two ways now open to our government whereby it
could implement the doctrine of this Court in the Krivenko case thereby
putting in force and carrying to its logical conclusion the mandate of our
Constitution. By following either of these remedies, or by approving an
implementary law as above suggested, we can enforce the fundamental
policy of our Constitution regarding our natural resources without doing
violence to the principle of pari delicto. With these remedies open to us, we
see no justifiable reason for pursuing the extreme unusual remedy now
vehemently urged by the amici curiae.

As applied to the right of the state to lands purchased by an alien, it would
more properly be termed a "forfeiture" at common law. (19 Am. Jur., 381.)
In modern law escheat denotes a falling of the estate into the general
property of the state because the tenant is an alien or because he has died
intestate without lawful heirs to take his estate by successions, or because of
some other disability to take or hold property imposed by law. (19 Am. Jur.,
381.)
In view of the foregoing, we hold that the sale in question is null and void,
but plaintiff is barred from taking the present action under the principle
of pari delicto.1âwphïl.nêt
The decision appealed from is hereby affirmed without pronouncement as to
costs.

With regard to an action for reversion, the following sections of

commonwealth Act No. 141 are pertinent:

Sec. 122. No land originally acquired in any manner under the provisions of
this Act, nor any permanent improvement on such land, shall be
encumbered, alienated, or transferred, except to persons, corporations,
associations, or partnerships who may acquire lands of the public domain
under this Act or to corporations organized in the Philippines authorized
therefor by their charters.

Sec. 123. No land originally acquired in any manner under the provisions of

any previous Act, ordinance, royal decree, royal order, or any other provision
of law formerly in force in the Philippines with regards to public
lands, terrenos baldios y realengos, or lands of any other denomination that
were actually or presumptively of the public domain or by royal grant or in
any other form, nor any permanent improvement on such land, shall be
encumbered, alienated, or conveyed, except to persons, corporation or
associations who may acquire land of the public domain under this Act or to
corporate bodies organized in the Philippines whose charters authorize them
to do so: Provided, however, That this prohibition shall not be applicable to
the conveyance or acquisition by reason or hereditary succession duly
acknowledged and legalized by competent courts; Provided, further, That in
the event of the ownership of the lands and improvements mentioned in this
section and in the last preceding section being transferred by judicial decree
to persons, corporations or associations not legally capacitated to acquire
the same under the provisions of this Act, such persons, corporation, or
associations shall be obliged to alienate said lands or improvements to others