Malaunan v.

Inciong
In this case, there was a mistake or confusion with surveying of the lots that
belonged to the respondent and petitioner and their original certificated of title
without their knowledge. Malaunan sought to recover the lots that were being
occupied by Inciong.

And the issue here is what is the remedy of an owner whose property has been
wrongfully and erroneously registered in another’s name?

after one year from the date of the decree, not to set aside the decree, but, respecting
the decree as incontrovertible and no longer open to review, THEN bring an
ordinary action in the ordinary court of justice for reconveyance or, if the property
has passed into the hands of an innocent purchaser for value, for damages

Can we consider Inciong to be of good faith? No, because at the time he purchased the
land covered by the certificate of title now in his hands he was aware that the
disputed portion was not included in the area conveyed to him by Matias Amurao.
This is clearly evident when he acknowledged as the true boundary the one (Exhibit
I) pointed to him by Matias Amurao. between his land and the disputed portion by
not raising any question about it and not disturbing the possession of the petitioner
over the area in dispute for almost 15 years.

“purchaser in good faith is one who buys the property of another without notice that
some other person has a right to, or interest in, such property and pays a full and fair price
for the same, at the time of such purchase, or before he has notice of the claim or interest
of some other person in the property”

Held: Malaunan can recover the property

Gatasaya v. Mabasa

-This case involves Mabasa who was granted a homestead patent. They secured a
loan with the DBP and mortgaged the patent.
-They failed to pay and DBP sold the land in a public auction where DBP was the
highest bidder.
-Heirs of Mabasa negotiated with DBP for the repurchase of lots and DBP allowed
them to recover through a conditional deed of sale which Mabasa asked Gaatsaya to
do (to assume payment of her obligation to DBP).
- Gatsaya agreed(condition: after 20 yrs nya fishpond)
-But Gatsaya stopped payment
-DBP revoked Mabasa’s right to recover and sold the lot in a public auction where
Gatasaya was the highest bidder
- Respondent then filed a complaint in the RTC for reconveyance of titles of lands
with damages against Gatasaya Claiming that the latter deliberately failed on his
commitment to pay DBP to: (1) revoke her right to repurchase the lots under the
deed of conditional sale and (2) subject the properties to another public auction
where petitioner could bid.

Defense of Gatasaya was that DBP refused to accept payment

-RTC ruled in favor of Mabasa for failure to prove that their actions were nor
fraudulent and failed to prove DPB rejected their payment and Mabasa deserved
reconveyance
-CA affirmed RT
HELD; Reconveyance is available not only to the legal owners of the property but
alos to those WITH A BETTER RIGHT
-Mabasa had a better right since she was given the right to repurchase by DBP and
they would have acquired the land back had It not have been for Gatsaya’s
fraudulent acts
-Gatasaya argues that Mabasa had no right to the lots since the conditional sale
agreement where the right if Mabasa was based on was cancelled by DBP
-this is not meritorious because this was the fruit of Gatasaya’s fraudulent actions
which if were considered meritorious, would be rewarding him for his misdead

Amerol vs. Bagumbaran G.R.

FACTS and ISSUE:

prescriptive period of an action for reconveyance of real property which has been
wrongfully or erroneously registered under the Torrens System in another's name.

The petitioners -ten years to bring the action,

Respondent- four years.

The trial court ruled tor the respondent Bagumbaran

HELD:
In this case, the land in question was patented and titled in respondent's name by and
through his false pretenses. Molok Bagumbaran fraudulently misrepresented that he was
the occupant and actual possessor of the land in question when he was not because it
was Liwalug Datomanong. Bagumbaran falsely pretended that there was no prior
applicant for a free patent over the land but there was — Liwalug Datomanong. by
authority of the President of the Philippines Ramon Magsaysay, by Jaime Ferrer,
Undersecretary of Agriculture and Natural Resources and duly registered with the office
of the Register of Deeds of the Province of Lanao

The fact of possession on the part of said defendant has been attested to by
competent and creditable witnesses like Mandal Tando who conveyed the land to
the defendant

Disomnong Dimna Macabuat, an employee in the office of the District Land Officer
at Marawi City who had officially conducted occular inspection and investigation of
the premises in connection with the protest of said defendant found thereon the
above-mentioned improvements introduced by the said defendant.

What is more, on or before filing his free patent application, plaintiff knew that the
land in question which was covered by his free patent application was then actually
occupied and cultivated by defendant Liwalug Datomanong if not by Mandal
Tando, the original occupant

Be it remembered that Mandal Tando had transferred to defendant Liwalug Datomanong

Twenty Four (24) hectares, more than eleven hectares of which is (sic) outside the
military reservation and designated as Lot No. 524, Pls-126 and the rest which is in the
southern portion lies within the military reservation. Now, immediately adjacent thereto
on the south is the land claimed and occupied by the herein plaintiff also consisting of
Twenty Four (24) hectares but wholly within the military reservation. It appears that
plaintiff declared this Twenty four hectares for the first time on October 24, 1950 for
taxation purposes (Tax Declaration No. 1529, Record) and stated in said tax declaration
(Exhs. "8" and "8-A," p. 414, Record) regarding the boundaries that the adjacent owner
on the north is Mandal Tando. In other words, plaintiff had expressly recognized the fact
that Mandal Tando is an adjacent land owner north of plaintiff's property

By such fraudulent acts, Molok Bagumbaran is deemed to hold the title of the property in
trust and for the benefit of petitioner Liwalug Datomanong.
Notwithstanding the irrevocability of the Torrens title already issued in the name of
respondent, he, even being already the registered owner under the Torrens system, may
still be compelled under the law to reconvey the subject property to Liwalug
Datomanong. After all, the Torrens system was not designed to shield and protect one
who had committed fraud or misrepresentation and thus holds title in bad faith. Further,
contrary to the erroneous claim of the respondent, reconveyance does not work to set
aside and put under review anew the findings of facts of the Bureau of Lands. In an
action for reconveyance, the decree of registration is respected as incontrovertible. What
is sought instead is the transfer of the property, in this case the title thereof, which has
been wrongfully or erroneously registered in another person's name, to its rightful and
legal owner,  or to one with a better right. That is what reconveyance is all about.
  It must be remembered that before August 30, 1950, the date of the effectivity of the new
Civil Code, the old Code of Civil Procedure (Act No. 190) governed prescription. It
provided:
SEC. 43. Other civil actions; how limited-Civil actions other than for the recovery of real
property can only be brought within the following periods after the right of action
accrues:
xxx xxx xxx
3. Within four years: x x x An action for relief on the ground of fraud, but the right of
action in such case shall not be deemed to have accrued until the discovery of the fraud;
xxx xxx xxx
In contrast, under the present Civil Code, we find that just as an implied or constructive
trust is an offspring of the law (Art. 1456, Civil Code), so is the corresponding obligation
to reconvey the property and the title thereto in favor of the true owner. In this context,
and vis-a-vis prescription, Article 1144 of the Civil Code is applicable.

Article 1144. The following actions must be brought within ten years from the time the
right of action accrues:
(1) Upon a written contract;
(2) Upon an obligation created by law;
(3) Upon a judgment.
xxx xxx xxx
(Emphasis supplied)
An action for reconveyance based on an implied or constructive trust (FRAUD) must
perforce prescribed in ten years and not otherwise. A long line of decisions of this Court,
and of very recent vintage at that, illustrates this rule. Undoubtedly, it is now well-settled
that an action for reconveyance based on an implied or constructive trust (fraud)
prescribes in ten years from the issuance of the Torrens title over the property. 

Saronjo v. Quijano
This case involves parcels of land which granted to Quijano under a free patent
-Quijano applied for two more free patents but Saronjo filed a complainting alleging
that the lots that Quijano wanted to apply for was under Saronjo’s ownership and
that they have been in possession of the parcels of land through their predecssors-
in-interest
-they filed a complaint to the Regional Execurtive Director of PENRO but later on
withdrew thwir complaint
-Nevertheless, PENRO rendered its decision free patents no longer be disturbed since the
complaint for the cancellation was filed more than one year from their issuance.
-Saronjo filed a complaint for cancellation in the RTC alleging that they are the owners of
several parcels of land which they inherited from their grandfather the late Maximo Sanjorjo. According to
the petitioners,sometime in 1983, the parcels of land in question were leased to Manuel Quijano for a two
(2) year period. BUT the lease was never and properties never returned to the petitioners, despite
repeated demands on Quijano to return the same. When Manuel Quijano died, his heirs divided among
themselves the land belonging to the petitioners. Plaintiffs averred that they nor their ascendants have
never sold, donated, or mortgaged any of these lots in question to the defendants or their ascendants. 
-Quijano opposied this complaint saying that the complaint was barred by res judicata from
the decision of PENRO
-RTC rendered its decision in favor of Quijano under es judicata
-CA affirmed the decision of RTC but for prescription

ISSUES:
1. Res judicata?
2. Is saranjo’s complaint for reconveyance barred by prescription
HELD
1. No res judiciata because reconveyance is under the jurisdiction of regular
courts. PENRO had no jurisdiction to decide the case, therefore there is no res
judicata
2. No prescription. While it is true that the patent issued to them can only be
reopened after 1 year of the issuance of OCT, the aggrieved party can also opt
to file for review on the ground of fraud via a petition for review in the Regional Trial
 Court (RTC) provided that no innocent purchaser for value has acquired the property or any
interest thereon. An aggrieved party may still file an action for reconveyance based on implied or
constructive trust, which prescribes in ten years from the date of the issuance of the Certificate of
Title over the property provided that the property has not been acquired by an innocent purchaser
for value.

DBP v. Bautista

FACTS:
-Bautista applied for a loan with the Rehabilitation Finance Corporation (RFC),
predecekssor in interest of the plaintiff-appellee Development Bank of the Philippines
(DBP), offering as security the parcel of land.
-Bautista also submitted to the RFC other documents to show her ownership and
possession of the land in question, namely, Tax Declaration No. 5153 in her name and
the blueprint plan of the land
-RFC approved a loan of P4,000.00 in favor of Bautista
-Bautista executed the mortgage contract over the property and the promissory note for
P4,000.00 in favor of RFC, after which the proceeds of the loan were released
-Bautista failed to pay the amortization on the loan so that the RFC took steps to
foreclose the mortgage extra-judicially
-In the ensuing auction sale conducted by the sheriff of Nueva Ecija on June 27, 1951,
the RFC acquired the mortgaged property as the highest bidder
-On July 21, 1952, upon failure of Bautista to redeem the property within the one (1)
year period as provided by law, plaintiff-appellant RFC consolidated its ownership
thereon and acquired a TCT under its name
-On or about this time, however, an action (Civil Case No. 870) was filed by Rufino
Ramos and Juan Ramos in the Court of First Instance of Nueva Ecija against the
Government of the Republic of the Philippines and the RFC claiming ownership of the
land in question and seeking the annulment of T.C.T. No. 2336 in the name of the
Government, O.C.T. No. P-389 in the name of Bautista and T.C.TG. No. NT-12108 in the
name of the RFC
-.A decision thereon was rendered on June 27, 1955) whereby the said certificates of title
were declared null and void
-As creditor, the Development Bank of the Philippines filed a complaint against one of its
debtors, Lourdes Gaspar Bautista for the recovery of a sum of money representing the
unpaid mortgage indebtedness, which previously had been wiped out with the creditor
bank acquiring the title of the mortgaged property in an extrajudicial sale
- Thereafter, the title was nullified in a judicial proceeding, the land in question being
adjudged as belonging to another claimant, without, however, such debtor, as above
noted, having been cited to appear in such court action.
- RTC dismissed petition; due process requirement thus flagrantly disregarded, since
Bautista was not a party in such action where her title was set aside, such a judgment
could in no wise be binding on her and be the source of a claim by the appellant bank
- CA dismissed petitio
ISSUE:
-What is the right, if any, of a creditor which previously satisfied its claim by foreclosing
extrajudicially on a mortgage executed by the debtor, whose title was thereafter nullified
in a judicial proceeding where she was not brought in as a party
HELD:
-RTC decision must be affirmed

-The fundamental due process requirement having been disregarded,

appellee Bautista could not in any wise be made to suffer, whether directly or indirectly,
from the effects of such decision. After appellant bank had acquired her title by such
extrajudicial foreclosure sale and thus, through its own act, seen to it that her obligation
had been satisfied, it could not thereafter, seek to revive the same on the allegation that
the title in question was subsequently annulled, considering that she was not made a
party on the occasion of such nullification.

-If it were otherwise, then the cardinal requirement that no party should be made to
suffer in person or property without being given a hearing would be brushed aside.

-According to the Civil Code "The vendor shall not be obliged to make good the proper
warranty, unless he is summoned in the suit for eviction at the instance of the vendee."
(Art 1495 NCC)

-In such a case, it is wisely provided by the Civil Code that appellee Bautista, as vendor,
should have been summoned and given the opportunity to defend herself. In view of her
being denied her day in court, it would follow, if the intent of the above codal provision
were to be respected, that she is not "obliged to make good the proper warranty."