G.R. No.
171531               January 30, 2009 including the alleged sale of the disputed property to
GUARANTEED HOMES, INC., Petitioner,
vs.
HEIRS OF MARIA P. VALDEZ, (EMILIA V. YUMUL and
VICTORIA V. MOLINO), HEIRS OF SEVERINA P.
TUGADE (ILUMINADA and LEONORA P. TUGADE,
HEIRS OF ETANG P. GATMIN (LUDIVINA G. DELA
CRUZ (by and through ALFONSO G. DELA CRUZ),
HILARIA G. COBERO and ALFREDO G. COBERO)
and SIONY G. TEPOL (by and through ELENA T.
RIVAS and ELESIO TEPOL, JR.), AS HEIRS OF
DECEDENT PABLO PASCUA, Respondents.
DECISION
Tinga, J.:
1 Pascua, Sr., son of Cipriano, filed on 24 January 1997 a
This is a petition for review  under Rule 45 of the Rules
of Court of the Court of Appeals’ Decision dated 22
March 20052 and Resolution dated 9 February 20063 in
CA-G.R. CV No. 67462. The Court of Appeals reversed
the 12 November 1999 Order of the Regional Trial Court
(RTC) of Olongapo City, Branch 734 which granted the
motion to dismiss filed by Guaranteed Homes, Inc.
(petitioner). The appellate court denied petitioner’s
motion for reconsideration.
The factual antecedents are as follows:
Respondents, who are the descendants of Pablo Pascua
(Pablo), filed a complaint seeking reconveyance of a
parcel of land with an area of 23.7229 hectares situated
in Cabitaugan, Subic, Zambales and covered by Original
Certificate of Title (OCT) No. 404 in the name of
Pablo.5 In the alternative, the respondents prayed that
damages be awarded in their favor.6
OCT No. 4047 was attached as one of the annexes of
respondents’ complaint. It contained several annotations
in the memorandum of encumbrances which showed
that the property had already been sold by Pablo during
his lifetime to Alejandria Marquinez and Restituto
Morales. Respondents also attached copies of the
following documents as integral parts of their complaint:
Transfer Certificate of Title (TCT) No. T-8241,8 TCT No.
T-8242,9 TCT No. T-10863,10 the Extrajudicial Settlement
of a Sole Heir and Confirmation of Sales11 executed by
Cipriano Pascua, Sr. (Cipriano), and the Deed of Sale
with Mortgage12 between spouses Albino Rodolfo and
Fabia Rodolfo (spouses Rodolfo) and petitioner.
In their complaint,13 respondents alleged that Pablo died
intestate sometime in June 1945 and was survived by
his four children, one of whom was the deceased
Cipriano.14 On 13 February 1967, Cipriano executed a
document denominated as "Extrajudicial Settlement of a
Sole Heir and Confirmation of Sales,"15 wherein he
declared himself as the only heir of Pablo and confirmed
the sales made by the decedent during his lifetime,
spouses Rodolfo.
Respondents likewise averred that on the following day
14 February 1967, TCT No. T-824116 was issued in the
name of Cipriano "without OCT No. 404 having been
cancelled."17 However, TCT No. T-8241 was not signed
by the Register of Deeds. On the same day, TCT No. T-
8242 was issued in the name of the spouses Rodolfo
and TCT No. T-8241 was thereby
cancelled.18 Subsequently, on 31 October 1969, the
spouses Rodolfo sold the disputed property to petitioner
by virtue of a Deed of Sale with Mortgage.
Consequently, on 5 November 1969, TCT No. T-8242
was cancelled and TCT No. T-1086319 was issued in the
name of petitioner.20
It was further averred in the complaint that Jorge
petition before the RTC of Olongapo City, Branch 75, for
the issuance of a new owner’s duplicate of OCT No. 404,
docketed as Other Case No. 04-0-97.21 The RTC denied
the petition.22 The trial court held that petitioner was
already the owner of the land, noting that the failure to
annotate the subsequent transfer of the property to it at
the back of OCT No. 404 did not affect its title to the
property.
Petitioner filed a motion to dismiss23 the complaint on the
grounds that the action is barred by the Statute of
Limitations, more than 28 years having elapsed from the
issuance of TCT No. T-10863 up to the filing of the
complaint, and that the complaint states no cause of
action as it is an innocent purchaser for value, it having
relied on the clean title of the spouses Rodolfo.
Impleaded as defendants, the heirs of Cipriano filed an
answer to the complaint in which they denied knowledge
of the existence of the extrajudicial settlement allegedly
executed by Cipriano and averred that the latter, during
his lifetime, did not execute any document transferring
ownership of the property.24
The Register of Deeds and the National Treasurer filed,
through the Office of the Solicitor General, an answer
averring that the six (6)-year period fixed in Section 102
of Presidential Decree (P.D.) No. 1529 for the filing of an
action against the Assurance Fund had long prescribed
since the transfer of ownership over the property was
registered through the issuance of TCT No. T-10863 in
favor of petitioner as early as 1969. They also claimed
that respondents have no cause of action against the
Assurance Fund since they were not actually deprived of
ownership over the property, as they could have
recovered the property had it not been for their inaction
for over 28 years.25
The RTC granted petitioner’s motion to dismiss.26 Noting
that respondents had never claimed nor established that
they have been in possession of the property and that
they did not present any evidence to show that petitioner
has not been in possession of the property either, the
RTC applied the doctrine that an action to quiet title
prescribes where the plaintiff is not in possession of the
property.
The trial court found that the complaint per its allegations
presented a case of implied or constructive trust on the
part of Cipriano who had inaccurately claimed to be the
sole heir of Pablo in the deed of extrajudicial settlement
of estate which led to the issuance of TCT No. T- 8241 in
his favor. As the prescriptive period for reconveyance of
a fraudulently registered real property is ten (10) years
reckoned from the date of the issuance of the title, the
trial court held that the action for reconveyance had
already prescribed with the lapse of more than 28 years
from the issuance of TCT No. T-10863 on 5 November
1969 as of the filing of the complaint on 21 November
1997.
The RTC added that it is an enshrined rule that even a
registered owner of property may be barred from
recovering possession of property by virtue of laches.
The RTC further held that petitioner had the right to rely
on TCT No. T- 8242 in the name of spouses Rodolfo.
Petitioner is not obliged to go beyond the title
considering that there were no circumstances
surrounding the sale sufficient to put it into inquiry.
Concerning the Assurance Fund, the RTC held that the
claim against it had long prescribed since Section 102 of
P.D. No. 1529 provides for a six-year period within which
a plaintiff may file an action against the fund and in this
case the period should be counted from the time of the
issuance of the challenged TCT No. T-10863 on 5
November 1969 and thus expired in 1975.
Undaunted, respondents appealed to the Court of
Appeals.27
The Court of Appeals reversed the RTC’s order.28 In
ordering the reinstatement of the complaint, the
appellate court ruled that the averments in respondents’
complaint before the RTC make out a case for quieting
of title which has not prescribed. Respondents did not
have to prove possession over the property since
petitioner as the movant in a motion to dismiss
hypothetically admitted the truth of the allegations in the
complaint. The appellate court found that possession
over the property was sufficiently alleged in the
complaint which stated that "neither petitioner nor the
Rodolfo spouses ever had possession of the disputed
property" as "a number of the Pascua heirs either had
been (still are) in actual, continuous and adverse
possession thereof or had been enjoying (still are
enjoying) the use thereof."29 By the same token, laches
had not set in, the Court of Appeals added.
The appellate court further held that the ruling of the
RTC that petitioner is an innocent purchaser for value is
contrary to the allegations in respondents’ complaint.
Hence, the present petition for review.
The sole issue before this Court revolves around the
propriety of the RTC’s granting of the motion to dismiss
and conversely the tenability of the Court of Appeals’
reversal of the RTC’s ruling.
The petition is meritorious.
It is well-settled that to sustain a dismissal on the ground
that the complaint states no cause of action, the
insufficiency of the cause of action must appear on the
face of the complaint, and the test of the sufficiency of
the facts alleged in the complaint to constitute a cause of
action is whether or not, admitting the facts alleged, the
court could render a valid judgment upon the same in
accordance with the prayer of the complaint. For the
purpose, the motion to dismiss must hypothetically admit
the truth of the facts alleged in the complaint.30 The
admission, however, is limited only to all material and
relevant facts which are well pleaded in the complaint.31
The factual allegations in respondents’ complaint should
be considered in tandem with the statements and
inscriptions on the documents attached to it as annexes
or integral parts. In a number of cases, the Court held
that in addition to the complaint, other pleadings
submitted by the parties should be considered in
deciding whether or not the complaint should be
dismissed for lack of cause of action.32 Likewise, other
facts not alleged in the complaint may be considered
where the motion to dismiss was heard with the
submission of evidence, or if documentary evidence
admitted by stipulation discloses facts sufficient to defeat
the claim.33 For while the court must accept as true all
well pleaded facts in the complaint, the motion does not
admit allegations of which the court will take judicial
notice are not true, nor does the rule apply to legally
impossible facts, nor to facts inadmissible in evidence,
nor to facts which appear by record or document
included in the pleadings to be unfounded.34
In the case at bar, the trial court conducted a hearing on
the motion to dismiss. At the hearing, the parties
presented documentary evidence. Among the
documents marked and offered in evidence are the
annexes of the complaint.35
Based on the standards set by this Court in relation to
the factual allegations and documentary annexes of the
complaint as well as the exhibits offered at the hearing of
the motion to dismiss, the inescapable conclusion is that
respondents’ complaint does not state a cause of action
against petitioner.
Firstly, the complaint does not allege any defect with
TCT No. T-8242 in the name of the spouses Rodolfo,
who were petitioner’s predecessors-in-interest, or any
circumstance from which it could reasonably be inferred
that petitioner had any actual knowledge of facts that
would impel it to make further inquiry into the title of the
spouses Rodolfo.36 It is basic that a person dealing with
registered property need not go beyond, but only has to
rely on, the title of his predecessor-in-interest. Since "the
act of registration is the operative act to convey or affect
the land insofar as third persons are concerned," it
follows that where there is nothing in the certificate of
title to indicate any cloud or vice in the ownership of the
property, or any encumbrance thereon, the purchaser is
not required to explore farther than what the Torrens title
upon its face indicates in quest for any hidden defect or
inchoate right that may subsequently defeat his right
thereto. If the rule were otherwise, the efficacy and
conclusiveness of the certificate of title which the
Torrens system seeks to insure would entirely be futile
and nugatory. The public shall then be denied of its
foremost motivation for respecting and observing the
Torrens system of registration. In the end, the business
community stands to be inconvenienced and prejudiced
immeasurably.37
Contrary to the assertion of respondents, OCT No. 404
was expressly cancelled by TCT No. T-8241. The
alleged non-signature by the Register of Deeds Soliman
Achacoso, , does not affect the validity of TCT No. T-
8241 since he signed TCT No. T- 8242 and issued both
titles on the same day. There is a presumption of
regularity in the performance of official duty. The
presumption is further bolstered by the fact that TCT No.
T-8241 was certified to be on file with the Registry of
Deeds and registered in the name of Cipriano. It is
enough that petitioner had examined the latest certificate
of title which in this case was issued in the name of the
immediate transferor, the spouses Rodolfo. The
purchaser is not bound by the original certificate but only
by the certificate of title of the person from whom he had
purchased the property.38
Secondly, while the Extrajudicial Settlement of a Sole
Heir and Confirmation of Sales executed by Cipriano
alone despite the existence of the other heirs of Pablo, is
not binding on such other heirs, nevertheless, it has
operative effect under Section 44 of the Property
Registration Decree, which provides that:
SEC. 44. Statutory Liens Affecting Title. — Every
registered owner receiving a certificate of title in
pursuance of a decree of registration, and every
subsequent purchaser of registered land taking a
certificate of title for value and in good faith, shall hold
the same free from all encumbrances except those noted
on said certificate and any of the following
encumbrances which may be subsisting, namely:
xxxx
Even assuming arguendo that the extrajudicial
settlement was a forgery, the Court still has to uphold the
title of petitioner. The case law is that although generally
a forged or fraudulent deed is a nullity and conveys no
title, there are instances when such a fraudulent
document may become the root of a valid title.39 And one
such instance is where the certificate of title was already
transferred from the name of the true owner to the
forger, and while it remained that way, the land was
subsequently sold to an innocent purchaser. For then,
the vendee had the right to rely upon what appeared in
the certificate.40
The Court cannot give credence to respondents’ claims
that the Extrajudicial Settlement of a Sole Heir and
Confirmation of Sales was not registered and that OCT
No. 404 was not cancelled by the Register of Deeds.
The Register of Deeds of Zambales certified that the
extrajudicial settlement was recorded on 14 February
1967, per Entry No. 18590. This is in compliance with
Section 56 of Act No. 496,41 the applicable law at the
time of registration, which provides that:
Sec. 56. Each register of deeds shall keep an entry book
in which he shall enter in the order of their reception all
deeds and other voluntary instruments, and all copies of
writs and other process filed with him relating to
registered land. He shall note in such book the year,
month, day, hour, and minute of reception of all
instruments, in the order in which they are
received. They shall be regarded as registered from
the time so noted, and the memorandum of each
instrument when made on the certificate of title to which
it refers shall bear the same date. [Emphasis supplied]
Registration in the public registry is notice to the whole
world. Every conveyance, mortgage, lease, lien,
attachment, order, judgment, instrument or entry
affecting registered land shall be, if registered, filed or
entered in the Office of the Register of Deeds of the
province or city where the land to which it relates lies, be
constructive notice to all persons from the time of such
registering, filing or entering.42
Thirdly, respondents cannot make out a case for quieting
of title since OCT No. 404 had already been cancelled.
Respondents have no title to anchor their complaint
on.43 Title to real property refers to that upon which
ownership is based. It is the evidence of the right of the
owner or the extent of his interest, by which means he
can maintain control and, as a rule, assert right to
exclusive possession and enjoyment of the property.44
Moreover, there is nothing in the complaint which
specified that the respondents were in possession of the
property. They merely alleged that the occupants or
possessors are "others not defendant Spouses
Rodolfo"45 who could be anybody, and that the property
is in actual possession of "a number of the Pascua
heirs"46 who could either be the respondents or the heirs
of Cipriano. The admission of the truth of material and
relevant facts well pleaded does not extend to render a
demurrer an admission of inferences or conclusions
drawn therefrom, even if alleged in the pleading; nor
mere inferences or conclusions from
facts not stated; nor conclusions of law; nor matters of
evidence; nor

surplusage and irrelevant matters.47

The other heirs of Pablo should have filed an action for

reconveyance based on implied or constructive trust
within ten (10) years from the date of registration of the
deed or the date of the issuance of the certificate of title
over the property.48 The legal relationship between
Cipriano and the other heirs of Pablo is governed by
Article 1456 of the Civil Code which provides that if a
property is acquired through mistake or fraud, the person
obtaining it is, by force of law, considered a trustee of an
implied trust for the benefit of the person from whom the
property comes.

From the above discussion, there is no question that

petitioner is an innocent purchaser for value; hence, no
cause of action for cancellation of title will lie against
it.49 The RTC was correct in granting petitioner’s motion
to dismiss.

Lastly, respondents’ claim against the Assurance Fund

also cannot prosper. Section 101 of P.D. No. 1529
clearly provides that the Assurance Fund shall not be
liable for any loss, damage or deprivation of any right or
interest in land which may have been caused by a
breach of trust, whether express, implied or constructive.
Even assuming arguendo that they are entitled to claim
against the Assurance Fund, the respondents’ claim has
already prescribed since any action for compensation
against the Assurance Fund must be brought within a
period of six (6) years from the time the right to bring
such action first occurred, which in this case was in
1967.

WHEREFORE, the petition is GRANTED. The decision

of the Court of Appeals in CA-G.R. CV No. 67462
is REVERSED and SET ASIDE. The 12 November 1999
Order of the Regional Trial Court of Olongapo City,
Branch 73 in Civil Case No. 432-097 is REINSTATED.

SO ORDERED.

G.R. No. 81163. September 26, 1988.
EDUARDO S. BARANDA and ALFONSO
HITALIA, Petitioners, v. HONORABLE JUDGE TITO
GUSTILO, ACTING REGISTER OF DEEDS AVITO
SACLAUSO, HONORABLE COURT OF APPEALS,
and ATTY. HECTOR P. TEODOSIO, Respondents.
Eduardo S. Baranda, for Petitioners.
Rico & Associates for Private Respondents.
SYLLABUS
1. REMEDIAL LAW; CIVIL PROCEDURE; ACTIONS;
NOTICE OF LIS PENDENS; PURPOSE. — "Lis
pendens has been conceived to protect the real rights of
the party causing the registration thereof. With the lis
pendens duly recorded, he could rest secure that he
would not lose the property or any part of it. For, notice
of lis pendens serves as a warning to a prospective
purchaser or incumbrancer that the particular property is
in litigation; and that he should keep his hands off the
same, unless of course he intends to gamble on the
results of the litigation. (Section 24, Rule 14, Rules of
Court; Jamora v. Duran, Et Al., 69 Phil. 3, 11; I Martin,
Rules of Court, p. 415, footnote 3, citing cases.)"
(Nataño v. Esteban, 18 SCRA 481, 485-485).
2. ID.; ID.; ID.; ID.; DISCRETIONARY POWER OF THE
COURT TO CANCEL LIS PENDENS; DELAYING
TACTICS OF PARTY IN CASE AT BAR IS A GROUND
FOR CANCELLATION. — A notice of lis pendens of Civil
Case No. 15871 was annotated on petitioner’s
Certificate of Title No. 106098 covering Lot No. 4517,
Sta. Barbara Cadastre. It appears, however, that private
respondents in filing said case were trying to delay the
full implementation of the final decisions in G.R. No.
62042 as well as G.R. No. 64432 wherein this Court
ordered the immediate implementation of the writs of
possession and demolition in the reconstitution
proceedings involving said lot. The foregoing facts
necessitate the application of the rule enunciated in the
cases of Victoriano v. Rovira (55 Phil. 1000), Municipal
Council of Parañaque v. Court of First Instance of Rizal
(70 Phil. 363) and Sarmiento v. Ortiz (10 SCRA 158), to
the effect that: "We have once held that while ordinarily a
notice of pendency which has been filed in a proper
case, cannot be cancelled while the action is pending
and undetermined, the proper court has the discretionary
power to cancel it under peculiar circumstances, as for
instance, where the evidence so far presented by the
plaintiff does not bear out the main allegations of his
complaint, and where the continuances of the trial, for
which the plaintiff is responsible, are unnecessarily
delaying the determination of the case to the prejudice of
the defendant. Victoriano v. Rovira, supra; The Municipal
Council of Parañaque v. Court of First Instance of Rizal,
supra)"
3. CIVIL LAW; LAND REGISTRATION; P.D. NO. 1529;
ALLOWS CANCELLATION OF LIS PENDENS UPON
PROOF THAT THE PURPOSE OF NOTICE IS TO
MOLEST THE ADVERSE PARTY; FAILURE TO
CANCEL NOTICE PURSUANT THERETO, AN ABUSE
OF DISCRETION. — Respondent Judge Tito Gustilo
abused his discretion in sustaining the respondent Acting
Register of Deeds’ stand that the notice of lis pendens in
the certificates of titles of the petitioners over Lot No.
4571, Barbara Cadastre cannot be cancelled on the
ground of pendency of Civil Case No. 15871 with the
Court of Appeals. In upholding the position of the Acting
Register of Deeds based on Section 77 of Presidential
Decree No. 1529, he conveniently forgot the first
paragraph thereof which provides: "Cancellation of lis
pendens. — Before final judgment, a notice of lis
pendens may be cancelled upon Order of the Court after
proper showing that the notice is for the purpose of
molesting the adverse party, or that it is not necessary to
protect the rights of the party who caused it to be
registered. It may also be cancelled by the Register of
Deeds upon verified petition of the party who caused the
registration thereof."cralaw virtua1aw library
4. ID.; ID.; ID.; DUTY OF REGISTER OF DEEDS IS
MINISTERIAL. — Under Sections 10 and 117 of
Presidential Decree No. 1529, the function of a Register
of Deeds with reference to the registration of deeds
encumbrance, instruments and the like is ministerial in
nature.
5. STATUTORY CONSTRUCTION; STATUTES;
WHERE WORDS ARE CLEAR AND UNEQUIVOCAL
STATUTES MUST BE TAKEN TO MEAN EXACTLY
WHAT IT DAYS; P.D. NO. 1529 IS CLEAR. — The
elementary rule in statutory construction is that when the
words and phrases of the statute are clear and
unequivocal, their meaning must be determined from the
language employed and the statute must be taken to
mean exactly what it says. (Aparri v. Court of Appeals,
127 SCRA 231; Insular Bank of Asia and America
Employees’ Union [IBAAEU] v. Inciong, 132 SCRA 663)
The statute concerning the function of the Register of
Deeds to register instruments in a torrens certificate of
title is clear and leaves no room for construction.
6. ID.; ID.; MEANING OF WORD "SHALL." — According
to Webster’s Third International Dictionary of the English
Language — the word shall means "ought to, must, . . .
obligation - used to express a command or exhortation,
used in laws, regulations or directives to express what is
mandatory."cralaw virtua1aw library
7. CRIMINAL LAW; AND REGISTRATION; P.D. NO.
1529; A REGISTER OF DEEDS HAS NO LEGAL
STANDING TO FILE A MOTION FOR COMMISSIONER
MUST BE SOUGHT IN CASE OF DOUBT. — The
respondent Acting Register of Deeds did not have any
legal standing to file a motion for reconsideration of the
respondent Judge’s Order directing him to cancel the
notice of lis pendens annotated in the certificates of titles
of the petitioners over the subject parcel of land. In case
of doubt as to the proper step to be taken in pursuance
of any deed . . . or other instrument presented to him, he
should have asked the opinion of the Commissioner of
Land Registration now, the Administrator of the National
Land Title and Deeds Registration Administration in
accordance with Section 117 of Presidential Decree No.
1529.
8. REMEDIAL LAW; JUDGMENT; EXECUTION; DELAY
IN THE IMPLEMENTATION OF COURT’S FINAL
RESOLUTION; RESPONSIBILITY FALLS ON THE
RESPONDENT JUDGE. — In the ultimate analysis,
however, the responsibility for the delays in the full
implementation of this Court’s already final resolutions in
G.R. No. 62042 and G.R. No. 64432 which includes the
cancellation of the notice of lis pendens annotated in the
certificates of titles of the petitioners over Lot No. 4517 of
the Sta. Barbara Cadastre falls on the respondent
Judge. He should never have allowed himself to become
part of dilatory tactics, giving as excuse the wrong
impression that Civil Case No. 15871 filed by the private
respondents involves another set of parties claiming Lot
No. 4517 under their own Torrens Certificate of Title.
DECISION
GUTIERREZ, JR., J.:
Eduardo S. Baranda and Alfonso Hitalia were the
petitioners in G.R. No. 64432 and the private
respondents in G.R. No. 62042. The subject matter of
these two (2) cases and the instant case is the same —
a parcel of land designated as Lot No. 4517 of the
Cadastral Survey of Sta. Barbara, Iloilo covered by
Original Certificate of Title No. 6406.
The present petition arose from the same facts and
events which triggered the filing of the earlier petitions.
These facts and events are cited in our resolution dated
December 29, 1983 in G.R. No. 64432, as
follows:jgc:chanrobles.com.ph
". . . This case has its origins in a petition for
reconstitution of title filed with the Court of First Instance
of Iloilo involving a parcel of land known as Lot No. 4517
of the Sta. Barbara Cadastre covered by Original
Certificate of Title No. 6406 in the name of Romana
Hitalia. Eventually, Original Certificate of Title No. 6406
was cancelled and Transfer Certificate of Title No.
106098 was issued in the names of Alfonso Hitalia and
Eduardo S. Baranda. The Court issued a writ of
possession which Gregorio Perez, Maria P. Gotera and
Susana Silao refused to honor on the ground that they
also have TCT No. 25772 over the same Lot No. 4517.
The Court, after considering the private respondents’
opposition and finding TCT No. 25772 fraudulently
acquired, ordered that the writ of possession be carried
out. A motion for reconsideration having been denied, a
writ of demolition was issued on March 29, 1982. Perez
and Gotera filed a petition for certiorari and prohibition
with the Court of Appeals. On August 6, 1982, the Court
of Appeals deemed the petition. Perez and Gotera filed
the petition for review on certiorari denominated as G.R.
No. 62042 before the Supreme Court. As earlier stated
the petition was denied in a resolution dated January 7,
1983. The motion for reconsideration was denied in
another resolution dated March 25, 1983, which also
stated that the denial is final. This decision in G.R. No.
62042, in accordance with the entry of judgment,
became final on March 25, 1983. The petitioners in the
instant case — G.R. No. 64432 — contend that the writs
of possession and demolition issued in the respondent
court should now be implemented; that Civil Case No.
00827 before the Intermediate Appellate Court was filed
only to delay the implementation of the writ; that counsel
for the respondent should be held in contempt of court
for engaging in a concerted but futile effort to delay the
execution of the writs of possession and demolition and
that petitioners are entitled to damages because of
prejudice caused by the filing of this petition before the
Intermediate Appellate Court. On September 26, 1983,
this Court issued a Temporary Restraining Order to
maintain the status quo, both in the Intermediate
Appellate Court and in the Regional Trial Court of Iloilo.
Considering that — (1) there is merit in the instant
petition for indeed the issues discussed in G.R. No.
64432 as raised in Civil Case No. 00827 before the
respondent court have already been passed upon in
G.R. No. 62042; and (2) the Temporary Restraining
Order issued by the Intermediate Appellate Court was
only intended not to render the petition moot and
academic pending the Court’s consideration of the
issues, the Court RESOLVED to DIRECT the
respondent Intermediate Appellate Court not to take
cognizance of issues already resolved by this Court and
accordingly DISMISS the petition in Civil Case No.
00827. Immediate implementation of the writs of
possession and demolition is likewise ordered." (pp. 107-
108, Rollo — G.R. No. 64432)
On May 9, 1984, the Court issued a resolution denying
with finality a motion for reconsideration of the December
29, 1983 resolution in G.R. No. 64432. On this same
date, another resolution was issued, this time in G.R. No.
62042, referring to the Regional Trial Court of Iloilo the
ex-parte motion of the private respondents (Baranda and
Hitalia) for execution of the judgment in the resolutions
dated January 7, 1983 and March 9, 1983. In the
meantime, the then Intermediate Appellate Court issued
a resolution dated February 10, 1984, dismissing Civil
Case No. 00827 which covered the same subject matter
as the Resolutions abovecited pursuant to our
Resolution dated December 29, 1983. The resolution
dated December 29, 1983 in G.R. No. 64432 became
final on May 20, 1984.
Upon motions of the petitioners, the Regional Trial Court
of Iloilo, Branch 23 presided by Judge Tito G. Gustilo
issued the following order:jgc:chanrobles.com.ph
"Submitted are the following motions filed by movants
Eduardo S. Baranda and Alfonso Hitalia through counsel
dated August 28, 1984:jgc:chanrobles.com.ph
"(a) Reiterating Motion for Execution of Judgment of
Resolutions dated January 7, 1983 and March 9, 1983
Promulgated by Honorable Supreme Court (First
Division) in G.R. No. 62042;
"(b) Motion for Execution of Judgment of Resolution
dated December 29, 1983 Promulgated by Honorable
Supreme Court (First Division) in G.R. No. 64432;
"(c) The Duties of the Register of Deeds are purely
ministerial under Act 496, therefore she must register all
orders, judgment, resolutions of this Court and that of
Honorable Supreme Court.
"Finding the said motions meritorious and there being no
opposition thereto, the same is hereby GRANTED.
"WHEREFORE, Transfer Certificate of Title No. T-25772
is hereby declared null and void and Transfer Certificate
of Title No. T-106098 is hereby declared valid and
subsisting title concerning the ownership of Eduardo S.
Baranda and Alfonso Hitalia, all of Sta. Barbara
Cadastre.
"The Acting Register of Deeds of Iloilo is further ordered
to register the Subdivision Agreement of Eduardo S.
Baranda and Alfonso Hitalia as prayed for." (p. 466,
Rollo - G.R. No. 64432).
The above order was set aside on October 8, 1984 upon
a motion for reconsideration and manifestation filed by
the Acting Register of Deeds of Iloilo, Atty. Helen P.
Sornito on the ground that there was a pending case
before this Court, an Action for Mandamus, Prohibition,
Injunction under G.R. No. 67661 filed by Atty. Eduardo
Baranda, against the former which remained unresolved.
In view of this development, the petitioners filed in G.R.
No. 62042 and G.R. No. 64432 ex-parte motions for
issuance of an order directing the Regional Trial Court
and Acting Register of Deeds to execute and implement
the judgments of this Court. They prayed that an order
be issued:jgc:chanrobles.com.ph
"1. Ordering both the Regional Trial Court of Iloilo
Branch XXIII, under Hon. Judge Tito G. Gustilo and the
acting Register of Deeds Helen P. Sornito to register the
Order dated September 5, 1984 of the lower court;
"2. To cancel No. T-25772. Likewise to cancel No. T-
106098 and once cancelled to issue new certificates of
title to each of Eduardo S. Baranda and Alfonso Hitalia;
Plus other relief and remedies equitable under the
premises." (p. 473, 64432 Rollo)
Acting on these motions, we issued on September 17,
1986 a Resolution in G.R. No. 62042 and G.R. No.
64432 granting the motions as prayed for. Acting on
another motion of the same nature filed by the
petitioners, we issued another Resolution dated October
8, 1986 referring the same to the Court Administrator for
implementation by the judge below.
In compliance with our resolutions, the Regional Trial
Court of Iloilo, Branch 23 presided by Judge Tito G.
Gustilo issued two (2) orders dated November 6, 1986
and January 6, 1987 respectively, to
wit:jgc:chanrobles.com.ph
"O R D E R
"This is an Ex-parte Motion and Manifestation submitted
by the movants through counsel on October 20, 1986;
the Manifestation of Atty. Helen Sornito, Register of
Deeds of the City of Iloilo, and formerly acting register of
deeds for the Province of Iloilo dated October 23, 1986
and the Manifestation of Atty. Avito S. Saclauso, Acting
Register of Deeds, Province of Iloilo dated November 5,
1986.
"Considering that the motion of movants Atty. Eduardo
S. Baranda and Alfonso Hitalia dated August 12, 1986
seeking the full implementation of the writ of possession
was granted by the Honorable Supreme Court, Second
Division per its Resolution dated September 17, 1986,
the present motion is hereby GRANTED.
"WHEREFORE, the Acting Register of Deeds, Province
of Iloilo, is hereby ordered to register the Order of this
Court dated September 5, 1984 as prayed for.
x           x          x
"O R D E R
"This is a Manifestation and Urgent Petition for the
Surrender of Transfer Certificate of Title No. T-25772
submitted by the petitioners Atty. Eduardo S. Baranda
and Alfonso Hitalia on December 2, 1986 in compliance
with the order of this Court dated November 25, 1986, a
Motion for Extension of Time to File Opposition filed by
Maria Provido Gotera through counsel on December 4,
1986 which was granted by the Court pursuant to its
Order dated December 15, 1986. Considering that no
Opposition was filed within the thirty (30) days period
granted by the Court finding the petition tenable, the
same is hereby GRANTED.
"WHEREFORE, Maria Provido Gotera is hereby ordered
to surrender Transfer Certificate of Title No. T-25772 to
this Court within ten (10) days from the date of this order,
after which period, Transfer Certificate of Title No. T-
25772 is hereby declared annulled and the Register of
Deeds of Iloilo is ordered to issue a new Certificate of
Title in lieu thereof in the name of petitioners Atty.
Eduardo S. Baranda and Alfonso Hitalia, which
certificate shall contain a memorandum of the annulment
of the outstanding duplicate." (pp. 286-287, Rollo 64432)
On February 9, 1987, Atty. Hector Teodosio, the counsel
of Gregorio Perez, private respondent in G.R. No. 64432
and petitioner in G.R. No. 62042, filed a motion for
explanation in relation to the resolution dated September
17, 1986 and manifestation asking for clarification on the
following points:jgc:chanrobles.com.ph
"a. As to the prayer of Atty. Eduardo Baranda for the
cancellation of TCT T-25772, should the same be
referred to the Court of Appeals (as mentioned in the
Resolution of November 27, 1985) or is it already
deemed granted by implication (by virtue of the
Resolution dated September 17, 1986)?
"b. Does the Resolution dated September 17, 1986
include not only the implementation of the writ of
possession but also the cancellation of TCT T-25772
and the subdivision of Lot 4517?" (p. 536, Rollo —
64432).
Acting on this motion and the other motions filed by the
parties, we issued a resolution dated May 25, 1987
noting all these motions and stating therein:chanrob1es
virtual 1aw library
x           x          x
"Since entry of judgment in G.R. No. 62042 was made
on January 7, 1983 and in G.R. No. 64432 on May 30,
1984, and all that remains is the implementation of our
resolutions, this COURT RESOLVED to refer the matters
concerning the execution of the decisions to the
Regional Trial Court of Iloilo City for appropriate action
and to apply disciplinary sanctions upon whoever
attempts to trifle with the implementation of the
resolutions of this Court. No further motions in these
cases will be entertained by this Court." (p. 615, Rollo -
64432)
In the meantime, in compliance with the Regional Trial
Court’s orders dated November 6, 1986 and January 6,
1987, Acting Register of Deeds Avito Saclauso
annotated the order declaring Transfer Certificate of Title
No. T-25772 as null and void, cancelled the same and
issued new certificates of titles numbers T-111560, T-
111561 and T-111562 in the name of petitioners
Eduardo S. Baranda and Alfonso Hitalia in lieu of
Transfer Certificate of Title No. T-106098.
However, a notice of lis pendens "on account of or by
reason of a separate case (Civil Case No. 15871) still
pending in the Court of Appeals" was carried out and
annotated in the new certificates of titles issued to the
petitioners. This was upheld by the trial court after
setting aside its earlier order dated February 12, 1987
ordering the cancellation of lis pendens.
This prompted the petitioners to file another motion in
G.R. No. 62042 and G.R. No. 64432 to order the trial
court to reinstate its order dated February 12, 1987
directing the Acting Register of Deeds to cancel the
notice of lis pendens in the new certificates of titles.
In a resolution dated August 17, 1987, we resolved to
refer the said motion to the Regional Trial Court of Iloilo
City, Branch 23 for appropriate action.
Since respondent Judge Tito Gustilo of the Regional
Trial Court of Iloilo, Branch 23 denied the petitioners’
motion to reinstate the February 12, 1987 order in
another order dated September 17, 1987, the petitioners
filed this petition for certiorari, prohibition and mandamus
with preliminary injunction to compel the respondent
judge to reinstate his order dated February 12, 1987
directing the Acting Register of Deeds to cancel the
notice of lis pendens annotated in the new certificates of
titles issued in the name of the petitioners.
The records show that after the Acting Register of Deeds
annotated a notice of lis pendens on the new certificates
of titles issued in the name of the petitioners, the
petitioners filed in the reconstitution case an urgent ex-
parte motion to immediately cancel notice of lis pendens
annotated thereon.
In his order dated February 12, 1987, respondent Judge
Gustilo granted the motion and directed the Acting
Register of Deeds of Iloilo to cancel the lis pendens
found on Transfer Certificate of Title Nos. T-106098; T-
111560; T-111561 and T-111562.
Respondent Acting Register of Deeds Avito Saclauso
filed a motion for reconsideration of the February 12,
1987 order stating therein:jgc:chanrobles.com.ph
"That the undersigned hereby asks for a reconsideration
of the said order based on the second paragraph of
Section 77 of P.D. 1529, to wit:jgc:chanrobles.com.ph
"‘At any time after final judgment in favor of the
defendant or other disposition of the action such as to
terminate finally all rights of the plaintiff in and to the land
and/or buildings involved, in any case in which a
memorandum or notice of Lis Pendens has been
registered as provided in the preceding section, the
notice of Lis Pendens shall be deemed cancelled upon
the registration of a certificate of the clerk of court in
which the action or proceeding was pending stating the
manner of disposal thereof.’
"That the lis pendens under Entry No. 427183 was
annotated on T-106098, T-111560, T-111561 and T-
111562 by virtue of a case docketed as Civil Case No.
15871, now pending with the Intermediate Court of
Appeals, entitled, ‘Calixta Provido, Ricardo Provido, Sr.,
Maxima Provido and Perfecto Provido, Plaintiffs, versus
Eduardo Baranda and Alfonso Hitalia, Respondents.’
"That under the above-quoted provisions of P.D. 152,
the cancellation of subject Notice of Lis Pendens can
only be made or deemed cancelled upon the registration
of the certificate of the Clerk of Court in which the action
or proceeding was pending, stating the manner of
disposal thereof.
"Considering that Civil Case No. 1587, upon which the
Notice of Lis Pendens was based is still pending with the
Intermediate Court of Appeals, only the Intermediate
Court of Appeals and not this Honorable Court in a mere
cadastral proceedings can order the cancellation of the
Notice of Lis Pendens." (pp. 68-69, Rollo)
Adopting these arguments and on the ground that some
if not all of the plaintiffs in Civil Case No. 15871 were not
privies to the case affected by the Supreme Court
resolutions, respondent Judge Tito Gustilo set aside his
February 12, 1987 order and granted the Acting Register
of Deeds’ motion for reconsideration.
The issue hinges on whether or not the pendency of the
appeal in Civil Case No. 15871 with the Court of Appeals
prevents the court from cancelling the notice of lis
pendens in the certificates of titles of the petitioners
which were earlier declared valid and subsisting by this
Court in G.R. No. 62042 and G.R. No. 64432. A corollary
issue is on the nature of the duty of a Register of Deeds
to annotate or annul a notice of lis pendens in a torrens
certificate of title.
Civil Case No. 15871 was a complaint to seek recovery
of Lot No. 4517 of Sta. Barbara Cadastre Iloilo, (the
same subject matter of G.R. No 62042 and G.R. No.
64432) from petitioners Baranda and Hitalia filed by
Calixta Provido, Ricardo Provido, Maxima Provido and
Perfecta Provido before the Regional Trial Court of Iloilo,
Branch 23. At the instance of Atty. Hector P. Teodosio,
the Providos’ counsel, a notice of lis pendens was
annotated on petitioners’ Certificate of Title No. T-
106098 covering Lot No. 4517, Sta. Barbara Cadastre.
Acting on a motion to dismiss filed by the petitioners, the
court issued an order dated October 24, 1984 dismissing
Civil Case No. 15871.
The order was then appealed to the Court of Appeals.
This appeal is the reason why respondent Judge Gustilo
recalled the February 12, 1987 order directing the Acting
Register of Deeds to cancel the notice of lis pendens
annotated on the certificates of titles of the petitioners.
This petition is impressed with merit.
Maria Provido Gotera was one of the petitioners in G.R.
No. 62042. Although Calixta Provido, Ricardo Provido,
Maxima Provido and Perfecta Provido, the plaintiffs in
Civil Case No. 15871 were not impleaded as parties, it is
very clear in the petition that Maria Provido was acting
on behalf of the Providos who allegedly are her co-
owners in Lot No. 4517, Sta. Barbara Cadastre as
shown by Transfer Certificate of Title No. T-25772
issued in her name and the names of the plaintiffs in
Civil Case No. 15871, among others. (Annex "E," G.R.
No. 62042, p. 51, Rollo) In fact, one of the issues raised
by petitioners Maria Provido Gotera and Gregoria Perez
in G.R. No. 62042 was as follows:chanrob1es virtual
1aw library
x           x          x
"2. Whether or not, in the same reconstitution
proceedings, respondent Judge Midpantao L. Adil had
the authority to declare as null and void the transfer
certificate of title in the name of petitioner Maria Provido
Gotera and her other co-owners." (p. 3, Rollo; Emphasis
supplied)
It thus appears that the plaintiffs in Civil Case No. 15871
were privies to G.R. No. 62042 contrary to the trial
court’s findings that they were not.
G.R. No. 62042 affirmed the order of the then Court of
First Instance of Iloilo in the reconstitution proceedings
declaring TCT No. 25772 in the name of Providos over
Lot No. 4517, Sta. Barbara Cadastre null and void for
being fraudulently obtained and declaring TCT No.
106098 over the same parcel Lot No. 4517, Sta. Barbara
Cadastre in the name of petitioners Eduardo Baranda
and Alfonso Hitalia valid and subsisting.
The decision in G.R. No. 62042 became final and
executory on March 25, 1983 long before Civil Case No.
15871 was filed.
Under these circumstances, it is crystal clear that the
Providos, private respondents herein, in filing Civil Case
No. 15871 were trying to delay the full implementation of
the final decisions in G.R. No. 62042 as well as G.R. No.
64432 wherein this Court ordered immediate
implementation of the writs of possession and demolition
in the reconstitution proceedings involving Lot No. 4517,
Sta. Barbara Cadastre.
The purpose of a notice of lis pendens is defined in the
following manner:jgc:chanrobles.com.ph
"Lis pendens has been conceived to protect the real
rights of the party causing the registration thereof. With
the lis pendens duly recorded, he could rest secure that
he would not lose the property or any part of it. For,
notice of lis pendens serves as a warning to a
prospective purchaser or incumbrancer that the
particular property is in litigation; and that he should
keep his hands off the same, unless of course he intends
to gamble on the results of the litigation. (Section 24,
Rule 14, Rules of Court; Jamora v. Duran, Et Al., 69 Phil.
3, 11; I Martin, Rules of Court, p. 415, footnote 3, citing
cases.)" (Nataño v. Esteban, 18 SCRA 481, 485-486).
The private respondents are not entitled to this
protection. The facts obtaining in this case necessitate
the application of the rule enunciated in the cases of
Victoriano v. Rovira (55 Phil. 1000), Municipal Council of
Parañaque v. Court of First Instance of Rizal (70 Phil.
363) and Sarmiento v. Ortiz (10 SCRA 158), to the effect
that:jgc:chanrobles.com.ph
"We have once held that while ordinarily a notice of
pendency which has been filed in a proper case, cannot
be cancelled while the action is pending and
undetermined, the proper court has the discretionary
power to cancel it under peculiar circumstances, as for
instance, where the evidence so far presented by the
plaintiff does not bear out the main allegations of his
complaint, and where the continuances of the trial, for
which the plaintiff is responsible, are unnecessarily
delaying the determination of the case to the prejudice of
the defendant. Victoriano v. Rovira, supra; The Municipal
Council of Parañaque v. Court of First Instance of Rizal,
supra)"
The facts of this case in relation to the earlier cases
brought all the way to the Supreme Court illustrate how
the private respondents tried to block but unsuccessfully
the already final decisions in G.R. No. 62042 and G.R.
No. 64432.
Parenthetically, respondent Judge Tito Gustilo abused
his discretion in sustaining the respondent Acting
Register of Deeds’ stand that the notice of lis pendens in
the certificates of titles of the petitioners over Lot No.
4571, Barbara Cadastre cannot be cancelled on the
ground of pendency of Civil Case No. 15871 with the
Court of Appeals. In upholding the position of the Acting
Register of Deeds based on Section 77 of Presidential
Decree No. 1529, he conveniently forgot the first
paragraph thereof which provides:jgc:chanrobles.com.ph
"Cancellation of lis pendens. — Before final judgment, a
notice of lis pendens may be cancelled upon Order of
the Court after proper showing that the notice is for the
purpose of molesting the adverse party, or that it is not
necessary to protect the rights of the party who caused it
to be registered. It may also be cancelled by the Register
of Deeds upon verified petition of the party who caused
the registration thereof."cralaw virtua1aw library
This Court cannot understand how respondent Judge
Gustilo could have been misled by the respondent Acting
Register of Deeds on this matter when in fact he was the
same Judge who issued the order dismissing Civil Case
No. 15871 prompting the private respondents to appeal
said order dated October 10, 1984 to the Court of
Appeals. The records of the main case are still with the
court below but based on the order, it can be safely
assumed that the various pleadings filed by the parties
subsequent to the motion to dismiss filed by the
petitioners (the defendants therein) touched on the issue
of the validity of TCT No. 25772 in the name of the
Providos over Lot Number 4571, Sta. Barbara Cadastre
in the light of the final decisions in G.R. No. 62042 and
G.R. No. 64432.
The next question to be determined is on the nature of
the duty of the Register of Deeds to annotate and/or
cancel the notice of lis pendens in a torrens certificate of
title.
Section 10, Presidential Decree No. 1529 states that "It
shall be the duty of the Register of Deeds to immediately
register an instrument presented for registration dealing
with real or personal property which complies with all the
requests for registration . . . If the instrument is not
registrable, he shall forthwith deny registration thereof
and inform the presentor of such denial in writing, stating
the ground or reasons therefore, and advising him of his
right to appeal by consulta in accordance with Section
117 of this Decree."cralaw virtua1aw library
Section 117 provides that "When the Register of Deeds
is in doubt with regard to the proper step to be taken or
memoranda to be made in pursuance of any deed,
mortgage or other instrument presented to him for
registration or where any party in interest does not agree
with the action taken by the Register of Deeds with
reference to any such instrument, the question shall be
submitted to the Commission of Land Registration by the
Register of Deeds, or by the party in interest thru the
Register of Deeds . . ."cralaw virtua1aw library
The elementary rule in statutory construction is that
when the words and phrases of the statute are clear and
unequivocal, their meaning must be determined from the
language employed and the statute must be taken to
mean exactly what it says. (Aparri v. Court of Appeals,
127 SCRA 231; Insular Bank of Asia and America
Employees’ Union [IBAAEU] v. Inciong, 132 SCRA 663)
The statute concerning the function of the Register of
Deeds to register instruments in a torrens certificate of
title is clear and leaves no room for construction.
According to Webster’s Third International Dictionary of
the English Language — the word shall means "ought to,
must, . . . obligation - used to express a command or
exhortation, used in laws, regulations or directives to
express what is mandatory." Hence, the function of a
Register of Deeds with reference to the registration of
deeds encumbrances, instruments and the like is
ministerial in nature. The respondent Acting Register of
Deeds did not have any legal standing to file a motion for
reconsideration of the respondent Judge’s Order
directing him to cancel the notice of lis pendens
annotated in the certificates of titles of the petitioners
over the subject parcel of land. In case of doubt as to the
proper step to be taken in pursuance of any deed . . . or
other instrument presented to him, he should have asked
the opinion of the Commissioner of Land Registration
now, the Administrator of the National Land Title and
Deeds Registration Administration in accordance with
Section 117 of Presidential Decree No. 1529.
In the ultimate analysis, however, the responsibility for
the delays in the full implementation of this Court’s
already final resolutions in G.R. No. 62042 and G.R. No.
64432 which includes the cancellation of the notice of lis
pendens annotated in the certificates of titles of the
petitioners over Lot No. 4517 of the Sta. Barbara
Cadastre falls on the respondent Judge. He should
never have allowed himself to become part of dilatory
tactics, giving as excuse the wrong impression that Civil
Case No. 15871 filed by the private respondents
involves another set of parties claiming Lot No. 4517
under their own Torrens Certificate of Title.
WHEREFORE, the instant petition is GRANTED. The
February 12, 1987 order of the Regional Trial Court of
Iloilo, Branch 23 is REINSTATED. All subsequent orders
issued by the trial court which annulled the February 12,
1987 order are SET ASIDE. Costs against the private
respondents.
SO ORDERED
G.R. No. 208264, July 27, 2016
OFFICE OF THE OMBUDSMAN, Petitioner, v. RICO C.
MANALASTAS, Respondent.
DECISION
CARPIO, J.:
The Case
This is a petition for review on certiorari1 assailing the
Decision dated 25 September 20122 and Resolution
dated 1 July 20133 of the Court of Appeals (CA) in CA-
G.R. SP No. 114797. The CA reversed and set aside the
Decision dated 12 September 2006 of the Office of the
Ombudsman, which found Rico C. Manalastas
(Manalastas) guilty of gross negligence and imposed on
him the penalty of one year suspension without pay.
The Facts
This case originated from a complaint for Grave
Misconduct filed by Miriam Jane M. Jacinto (Jacinto),
Assistant Vice President of BPI Family Savings Bank,
Inc. (BPI Family), against Atty. Lorna S. Dee (Dee),
Manalastas, and Gilberto M. Paras (Paras), in their
capacities as Register of Deeds, Examiner, and Acting
Deputy Register of Deeds, respectively, of the Office of
the Register of Deeds of San Juan City, Metro Manila.
In the Complaint, Jacinto alleged that sometime in
September 2000, Dy Chiu Ha Tiu or Marian Dy Tiu
(Marian) applied for a loan in the amount of P20,000,000
with BPI Family. Marian requested that her husband's
property located at 19 Lincoln St., West Greenhills, San
Juan City be appraised for collateral purposes. The
property was registered in the name of Paquito Tiu
(Paquito), Marian's husband, and covered by Transfer
Certificate of Title (TCT) No. 1035. BPI Family assessed
the property at P3 6,072,900. Thereafter, BPI Family
approved the loan application of Marian secured by the
residential property.
On 25 January 2001, Marian and a certain person whom
she introduced as her husband Paquito, signed,
executed, and delivered to BPI Family several
documents required for the loan. These documents were
the Real Estate Mortgage, Loan Agreement, Promissory
Note, and Disclosure Statement, as well as the Owner's
Duplicate Copy of TCT No. 1035 in the name of Paquito.
On the same day, Reynold Cuasay, BPI Family's bank
personnel, brought the Real Estate Mortgage and the
other documents to the Office of the Register of Deeds
of San Juan City for annotation and registration of the
mortgage.
Manalastas, as Examiner of said office, examined the
documents and assessed the corresponding fees. After
Cuasay paid for the fees, Manalastas entered the
mortgage in the Registration Book under Entry No.
4435/T-1035 and affixed his initials on the Real Estate
Mortgage. Thereafter, Manalastas endorsed the same
document to Paras, as Acting Deputy Register of Deeds.
After examination, Paras affixed his initials on the Real
Estate Mortgage then endorsed it further to Dee, the
Register of Deeds. Finding the documents to have
passed through the natural course of registration, Dee
also affixed her signature on the Real Estate Mortgage,
the Owner's Duplicate Copy of TCT No. 1035, and the
Registry Copy of TCT No. 1035, which served as
collateral for the loan.
Thereafter, BPI Family released the net proceeds of the
loan in the amount of P19,765,093.27 by crediting the
Spouses Tiu's Joint Current Account/Savings Account
No. 6835-0036-96 which was opened at BPI Family's
Commonwealth branch.
On 1 February 2001, the real Paquito Tiu, accompanied
by his lawyer, Atty. Deogracias C. Eufemio, went to BPI
Family's main office located in Makati City. Paquito
informed BPI Family's officers that the signatures of one
Paquito Tiu appearing on the loan documents were not
his since he was not the same Paquito Tiu who signed
them. Paquito presented his Owner's Duplicate Copy of
TCT No. 1035 and submitted a Sworn Statement stating
that he never signed the loan documents applied for by
Marian and that his signatures therein were forged.
BPI Family immediately made a verification with the
Office of the Register of Deeds of San Juan City. Upon
thorough examination, the Owner's Duplicate Copy of
TCT No. 1035 submitted by Marian, although on its face
appeared to be real and authentic since the title was in a
Land Registration Authority form, turned out to be fake
and spurious.
After such discovery, Dee, as Register of Deeds, filed
with the Office of the Prosecutor (Pasig City) a case
against Marian for falsification of public documents.
Subsequently, BPI Family filed an administrative
complaint4 for Grave Misconduct with the Office of the
Ombudsman against Dee, Manalastas, and Paras. BPI
Family asserted that due to their negligence and
dereliction of duties in failing to examine the
genuineness and authenticity of TCT No. 1035, the bank
was allegedly defrauded in the amount of
P16,460,671.63, exclusive of interest and other charges.
In a Decision dated 12 September 2006, the Office of the
Ombudsman found Dee, Manalastas, and Paras guilty of
gross negligence and imposed on them the penalty of
one year suspension without pay. The Office of the
Ombudsman declared that the government officials were
grossly negligent in the performance of their official
functions when they failed to distinguish the
discrepancies between the owner's duplicate copy of title
presented for registration and the original copy of the title
on file with their office. The dispositive portion of the
Decision states:
chanRoblesvirtualLawlibrary
WHEREFORE, herein public respondents Rico S.
Manalastas, Gilberto M. Paras, and Atty. Lorna
Salangsang Dee, are hereby meted the penalty of ONE
(1) YEAR SUSPENSION WITHOUT PAY in accordance
with number (2), Section 25, Republic Act No. 67705 in
relation to Section 10(b) of Administrative Order 07,
Rules of Procedure, Office of the Ombudsman.
x x x x
SO ORDERED.6chanroblesvirtuallawlibrary
Since Paras retired from government service in October
2003, his penalty of suspension was rendered moot and
academic. Dee and Manalastas filed their separate
motions for reconsideration which were denied by the
Office of the Ombudsman in an undated
Order.7chanrobleslaw
Manalastas then filed an appeal8 with the CA. In a
Decision9 dated 25 September 2012, the CA reversed
the ruling of the Office of the Ombudsman. The CA ruled
that Manalastas enjoys in his favor the presumption of
regularity in the performance of his official duty
and BPI Family failed to discharge the burden of proving
otherwise. The CA added that no liability could attach to
Manalastas in a registration procured through fraud
unless he is a party to such fraud. If the real Paquito Tiu
did not appear to contest the loan and the mortgage then
the forgery would not have been discovered, bolstering
Manalastas's claim that he had acted in good faith in his
dealings with the documents presented before him for
registration. Moreover, the CA declared that the
proximate cause of BPI Family's loss was its failure to
discover the forgeries in the documents as well as the
real identity of the impostor husband. The dispositive
portion of the Decision states:
chanRoblesvirtualLawlibrary
WHEREFORE, the appeal is GRANTED. The Decision
dated September 12, 2006 of the Office of the
Ombudsman in OMB-C-A-03- 0386-J is REVERSED and
SET ASIDE. Accordingly, petitioner Rico C. Manalastas
is EXONERATED. Thus, he should be paid his
backwages corresponding to the period of his illegal
suspension.
SO ORDERED.10
BPI Family filed a Motion for Reconsideration which was
denied by the CA in a Resolution11 dated 1 July 2013.
Hence, the instant petition filed by the Office of the
Ombudsman.
The Issue
The issue for our resolution is whether the CA erred in
exonerating Manalastas for negligence in failing to
determine the genuineness of the owner's duplicate copy
of the title attached to the real estate mortgage sought to
be annotated with the Office of the Register of Deeds of
San Juan City.
The Court's Ruling
The petition lacks merit.
Petitioner contends that Manalastas fell short of his
duties and responsibilities as Examiner of the Office of
the Register of Deeds for failing to determine the
genuineness of the owner's duplicate copy of TCT No.
1035 when referred to him for examination in the
annotation and registration of the real estate mortgage.
Petitioner maintains that there is substantial evidence to
hold Manalastas administratively liable for negligence
since it is expected of Manalastas to exercise utmost
caution in the examination of documents related to
registration. Here, the owner's duplicate copy of TCT No.
1035 sought to be annotated and registered is an
"authenticated copy." Petitioner insists that the loanable
amount with BPI Family involved P20,000,000; thus,
Manalastas should have been more circumspect in
examining the genuineness of the said document.
Manalastas, on the other hand, contends that the
owner's duplicate copy of TCT No. 1035 attached to the
real estate mortgage presented to him purported and
appeared to be authentic and there was no patent defect
or irregularity on its face. Manalastas asserts that the
falsification of the title, which was an almost exact replica
of the original, must have been professionally done that
reasonable care would not have immediately detected
such misrepresentation. Manalastas maintains that
registration was effected because there was no defect or
irregularity on the face of the document which would
cause a person in his position to deny such registration.
In the present case, Manalastas was found guilty of
gross negligence for failing to discover the falsity of the
owner's duplicate copy of title attached to the real estate
mortgage submitted by BPI Family to the Office of the
Register of Deeds. The Office of the Ombudsman ruled
that BPI Family had adequately established
Manalastas's negligence by substantial evidence. The
relevant portions of the Ombudsman's Decision dated 12
September 2006 state:
chanRoblesvirtualLawlibrary
Considering that the Owner's Duplicate Copy of Title No.
1035 attached to the Real Estate Mortgage being sought
to be annotated, is in an authenticated form only, that
fact should have put the respondents on guard and
therefore, each respondent should have been more
vigilant by exerting effort in comparing and verifying its
authenticity by looking into its minute details vis-a-vis the
original copy on file with them.
xxx [I]t is noted that, the BANK has no means of knowing
whether or not a title is genuine except upon verification
from the Office of the Registry of Deeds as custodian of
the original copies of the transfer certificates of title.
Lamentably, it is in this wise that respondents were
grossly negligent in the performance of their official
functions when they failed to distinguish the
discrepancies between the owner's duplicate copy of title
being presented for registration and the original copy of
the title on file with their office.12
However, the CA, in reversing the decision of the
Ombudsman, held that the primary reason why BPI
Family went to the Office of the Register of Deeds was to
have the real estate mortgage registered and annotated
and not to verify the authenticity of the owner's duplicate
copy of title. Prior to such registration, BPI Family
already approved the loan. The relevant portions of the
Decision dated 25 September 2012 state:
chanRoblesvirtualLawlibrary
It must be noted that the main purpose of BPI when it
brought the Real Estate Mortgage together with the
purported owner's duplicate copy of title to the Office of
the Register of Deeds was to have the said
mortgage inscribed in the records of said office
and annotated at the back of the certificate of title
covering the land subject of the instrument and not  to
verify the authenticity of the owner's duplicate copy of
title. In fact, BPI verified the authenticity of the forged title
only after the real Paquito Tiu showed up and informed
its head office about the forgery.13
We agree with the CA.
Section 10 of Presidential Decree No. 152914 lays down
the general functions of the Register of Deeds:
chanRoblesvirtualLawlibrary
Section 10. General functions of Registers of Deeds.  -
The office of the Register of Deeds constitutes a public
repository of records of instruments affecting registered
or unregistered lands and chattel mortgages in the
province or city wherein such office is situated.
It shall be the duty of the Register of Deeds to
immediately register an Instrument presented for
registration dealing with real or personal property which
complies with all the requisites for registration. He shall
see to it that said instrument bears the proper
documentary and science stamps and that the same are
properly canceled. If the instrument is not registrable, he
shall forthwith deny registration thereof and inform the
presentor of such denial in writing, stating the ground or
reason therefor, and advising him of his right to appeal
by consulta  in accordance with Section 117 of this
Decree.
Registration is a mere ministerial act by which a deed,
contract, or instrument is sought to be inscribed in the
records of the Office of the Register of Deeds and
annotated at the back of the certificate of title covering
the land subject of the deed, contract, or instrument.
Being a ministerial act, it must be performed in any case.
The public officer having this ministerial duty has no
choice but to perform the specific action which is the
particular duty imposed by law. The purpose of
registration is to give notice to all persons. It operates as
a notice of the deed, contract, or instrument to others,
but neither adds to its validity nor converts an invalid
instrument into a valid one between the
parties.15chanrobleslaw
Since registration of documents is a ministerial act and
merely creates a constructive notice of its contents
against all third persons,16 the Register of Deeds is not
authorized to determine whether or not fraud was
committed in the document sought to be
registered.17chanrobleslaw
Here, the falsification of the owner's duplicate copy of
title was professionally done, that even someone
exercising reasonable prudence and care would not
instantly detect. On its face, the title was not apparently
discernible as fake or spurious and could pass as a
genuine and bona fide  document. The title was in
authentic form issued by the Land Registration Authority
and an exact reproduction of the original copy with the
same serial numbers, impressions, texts, and signatures.
When a document is in "authentic form," this means that
at the time the document was inspected and verified,
there was nothing extraordinary that would have placed
even a reasonable person to suspect of any wrongdoing.
As a public officer, Manalastas enjoys the presumption
of regularity in the performance of his official duties and
functions.18 Manalastas accepted the requirements
presented by BPI Family for annotation and registration
of the real estate mortgage in the ordinary course of
transaction. His examination of the owner's duplicate
copy of title and his recommendation to his superiors for
the approval of the annotation and registration of the real
estate mortgage were made in good faith and not tainted
with gross negligence.
Gross negligence implies a want or absence of or failure
to exercise slight care or diligence, or the entire absence
of care. It evinces a thoughtless disregard of
consequences without exerting any effort to avoid
them.19 It is characterized by want of even slight care,
acting or omitting to act in a situation where there is a
duty to act, not inadvertently but willfully and intentionally
with a conscious indifference to consequences insofar as
other persons may be affected.20chanrobleslaw
In administrative cases, the quantum of proof needed to
adjudge a respondent guilty is substantial evidence.
In Miro v. Mendoza,21 we held that substantial evidence
is defined as such amount of relevant evidence which a
reasonable mind might accept as adequate to support a
conclusion.
It is more than a mere scintilla of evidence. The standard
of substantial evidence is satisfied when there is
reasonable ground to believe, based on the evidence
submitted, that the respondent is responsible for the
misconduct complained of. It need not be overwhelming
or preponderant, as is required in an ordinary civil case,
or evidence beyond reasonable doubt, as is required in a
criminal case, but the evidence must be enough for a
reasonable mind to support a conclusion.
In this case, the owner's duplicate copy of title attached
to the real estate mortgage was written in an official
paper of the Land Registration Authority and contained
all the markings of a genuine title. The Office of the
Register of Deeds is not mandated to investigate further
than necessary when documents presented before it
appear authentic. We agree with the CA when it
declared:
chanRoblesvirtualLawlibrary
x x x [T]here is no basis to hold petitioner liable for gross
negligence simply because he failed to discover the
forgery in the owner's duplicate copy of title. It would be
a grave injustice to punish him, when, in reality, he
himself was a victim of the defraudation.
x x x x
xxx [N]o liability could attach to petitioner in all
registration procured through fraud, as in this case,
unless he is a party to such fraud. Indeed, were it not for
the appearance of the real Paquito Tiu, the forgery would
not have been discovered. This bolsters petitioner's
claim that he had acted in good faith in his dealings with
the documents presented before him for registration.22
Also, BPI Family has the burden of proof to overcome
the presumption of regularity in the performance of
official duty. BPI Family would want to pass the blame to
Manalastas by imputing gross negligence on his part
when it is BPI Family which is the proximate cause of the
loss.
As mentioned by the Office of the Ombudsman in its
Decision dated 12 September 2006, BPI Family had
been remiss in approving the loan without first making a
thorough investigation of the true identity of its clients
and the genuineness of the documents submitted to it.
The relevant portions of the Decision state:
chanRoblesvirtualLawlibrary
x x x [T]he BANK may have been negligent to protect its
interests when it approved the loan without first making
the necessary investigation normally conducted by
banking and/or financial/lending institutions, that is, i) by
ascertaining that all the documents presented are
authentic and that the persons who introduce
themselves as owners are indeed the owner[s] of the
property, and borrowers, if not the registered owner, are
equipped with the legal document to transact business
and ii) by conducting actual character and background
investigation on Marian Dy Tiu as applicant and of
Paquito Tiu being the registered owner of the property.23
Thus, as aptly held by the CA:
chanRoblesvirtualLawlibrary
It cannot be said that by reason of the failure of petitioner
to discover the forgery, BPI was defrauded in the amount
of P4,850,000.00 considering that prior to registration of
the mortgage, BPI already approved the loan applied for
by Marian upon the latter's submission of the requisite
documents with the presence of an impostor husband. In
other words, as between the failure of BPI to discover
the forgeries in the documents as well as the real identity
of the impostor husband on one hand, and the failure of
petitioner to discover the forged owner's duplicate [copy]
of title on the other, the former should be considered as
the proximate cause of BPI's loss. 24
As Justice Tuason opined, in his concurring and
dissenting opinions in the case of him v. Register of
Deeds of Rizal,25cralawred Registers of Deeds are not
guardians entrusted with watching over the private
interests of contracting parties who are fully capable of
looking after their own affairs. Thus, BPI Family has to
bear the burden of loss.
In sum, in the absence of any substantial evidence that
Manalastas did not properly perform his duty as
Examiner or that he intentionally performed an illegal act,
then the presumption of regularity in the performance of
duty should prevail. We do not find Manalastas
administratively liable for gross negligence in carrying
out his official functions which he had executed within
reasonable bounds of diligence and care.
WHEREFORE, we DENY the petition. We AFFIRM the
Decision dated 25 September 2012 and Resolution
dated 1 July 2013 of the Court of Appeals in CA-G.R. SP
No. 114797.
SO ORDERED.