DELA MERCED vs.

DELA MERCED

February 25, 1999

FACTS:

Evarista M. dela Merced died intestate, without issue. She left five (5) parcels of land and
was survived by three sets of heirs, viz: (1) Francisco M. dela Merced, her legitimate brother;
(2) Teresita P. Rupisan, her niece who is the only daughter of Rosa dela Merced-Platon (a
sister who died in 1943); and (3) the legitimate children of Eugenia dela Merced-Adriano
(another sister of Evarista who died in 1965), namely: Herminio, Ruben, Joselito, Rogelio,
Wilfredo, Victor and Constantino, all surnamed Adriano, Corazon Adriano-Ongoco and
Jasmin Adriano-Mendoza.

On April 20, 1989, the three sets of heirs of the decedent, executed an extrajudicial
settlement, adjudicating the properties of Evarista to them, each set with a share of (1/3)
pro-indiviso. Joselito P. Dela Merced, illegitimate son of the late Francisco, filed a "Petition
for Annulment of the Extrajudicial and prayed that he be included to share in the (1/3) pro-
indiviso share in the estate of corresponding to the heirs of Francisco.

ISSUE:

WON Joselito as an illegitimate child is barred from inheriting from Evaristas estate.

HELD:

No. The present case relates to the rightful and undisputed right of an heir to the share
of his late father in the estate of the decedent Evarista, ownership of which had been
transmitted to his father upon the death of Evarista. There is no legal obstacle for private
respondent Joselito, admittedly the son of the late Francisco, to inherit in his own right as an
heir to his father's estate, which estate includes a one-third (1/3) undivided share in the estate of
Evarista.
Bueno vs. Lopez

G.R. No. L-25966 November 1, 1926

Facts: This appeal involves a controversy over one-half of the estate of

Tomas Rodriguez, decedent. The appellant, Margarita Lopez, claims said half
by the intestate succession as next of kin and nearest heir; while the
appellee, Luz Lopez de Bueno, claims the same by accredition and in the
character of universal heir the will of the decedent. The trial court decided
the point of controversy in favor of Luz Lopez de Bueno, and Margariat Lopez
appealed.

Issue: Whether or not there exists right of accretion

Ruling: accretion take place in a testamentary succession, first when the two or more
persons are called to the same inheritance or the same portion thereof without special
designation of shares; and secondly, when one of the persons so called dies before the
testator or renounces the inheritance or is disqualifying to receive it. In the case before
us we have a will calling Vicente F. Lopez and his daughter, Luz Lopez de Bueno, to the
same inheritance without special designation of shares. In addition to this, one of the
persons named as heir has predeceased the testator, this person being also disqualified
to receive the estate even if he had been alive at the time of the testator's death. This
article (982) is therefore also of exact application to the case in hand; and its effect is to
give to the survivor, Luz Lopez de Bueno, not only the undivided half which she would
have received in conjunction with her father if he had been alive and qualified to take,
but also the half which pertained to him. There was no error whatever, therefore, in the
order of the trial court declaring Luz Lopez de Bueno entitled to the whole estate.

G.R. Nos. 140371-72 November 27, 2006

DY YIENG SEANGIO, BARBARA D. SEANGIO and VIRGINIA D. SEANGIO, Petitioners,

vs.
HON. AMOR A. REYES, in her capacity as Presiding Judge, Regional Trial Court, National
Capital Judicial Region, Branch 21, Manila, ALFREDO D. SEANGIO, ALBERTO D. SEANGIO,
ELISA D. SEANGIO-SANTOS, VICTOR D. SEANGIO, ALFONSO D. SEANGIO, SHIRLEY D.
SEANGIO-LIM, BETTY D. SEANGIO-OBAS and JAMES D. SEANGIO, Respondents.

DECISION
AZCUNA, J.:

Facts: private respondents filed a petition for the settlement of the intestate estate of the late
Segundo Seangio and praying for the appointment of private respondent Elisa D. SeangioSantos
as special administrator and guardian ad litem of petitioner Dy Yieng Seangio.

Petitioners opposed the petition. They contended among others that: 4) Segundo left a holographic
will, dated September 20, 1995, disinheriting one of the private respondents, Alfredo Seangio, for
cause. In view of the purported holographic will, petitioners averred that in the event the decedent is
found to have left a will, the intestate proceedings are to be automatically suspended and replaced
by the proceedings for the probate of the will.

Issue: whether the document executed by Segundo can be considered as a holographic will.

A holographic will, as provided under Article 810 of the Civil Code, must be entirely written, dated,
and signed by the hand of the testator himself. It is subject to no other form, and may be made in or
out of the Philippines, and need not be witnessed.

Segundos document, although it may initially come across as a mere disinheritance instrument,
conforms to the formalities of a holographic will prescribed by law. It is written, dated and signed by
the hand of Segundo himself. An intent to dispose mortis causa[9] can be clearly deduced from the
terms of the instrument, and while it does not make an affirmative disposition of the latters property,
the disinheritance of Alfredo, nonetheless, is an act of disposition in itself. In other words, the
disinheritance results in the disposition of the property of the testator Segundo in favor of those who
would succeed in the absence of Alfredo.10

G.R. No. 189776 : December 15, 2010

AMELIA P. ARELLANO, represented by her duly appointed guardians, AGNES

P. ARELLANO and NONA P. ARELLANO,Petitioner, v. FRANCISCO PASCUAL
and MIGUEL PASCUAL, Respondents.

CARPIO MORALES, J.:

FACTS:

Angel N. Pascual Jr. died intestate leaving as heirs his siblings, In a petition for
"Judicial Settlement of Intestate Estate and Issuance of Letters of Administration,"
respondents alleged, inter alia, that a parcel of land (the donated property), which
was, by Deed of Donation, transferred by the decedent to petitioner the validity of
which donation respondents assailed, "may be considered as an advance legitime"
of petitioner. the probate court found the Deed of Donation valid in light of the
presumption of validity of notarized documents. It thus went on to hold that it is
subject to collation following Article 1061 of the New Civil Code The probate court
thereafter partitioned the properties of the intestate estate.

ISSUE: Whether the property donated to petitioner is subject to collation;

Whether the property of the estate should have been ordered equally distributed
among the parties.

HELD: The case was remanded to the trial court for collation of the properties before
partition.

CIVIL LAW: collation

Collation takes place when there are compulsory heirs, one of its purposes being to
determine the legitime and the free portion. If there is no compulsory heir, there is no
legitime to be safeguarded.

The records do not show that the decedent left any primary, secondary, or
concurring compulsory heirs. The decedent not having left any compulsory heir who
is entitled to any legitime, he was at liberty to donate all his properties, even if
nothing was left for his siblings-collateral relatives to inherit. His donation to
petitioner, assuming that it was valid, is deemed as donation made to a "stranger,"
chargeable against the free portion of the estate. There being no compulsory heir,
however, the donated property is not subject to collation.

Nepomuceno v. CA Digests
Nepomuceno v. Court of Appeals

Facts:
1. Martin Hugo died on 1974 and he left a will wherein he instituted Sofia Nepomuceno as
the sole and only executor. It was also provided therein that he was married to Rufina Gomez
with whom he had 3 children.

2. Petitioner (Sofia) filed for the probate of the will but the legal wife and her children
opposed alleging that the will was procured through improper and undue influence and that
there was an admission of concubinage with the petitioner.

3. The lower court denied the probate on the ground of the testator's admission of
cohabitation, hence making the will invalid on its face. The Court of Appeals reversed and
held that the will is valid except the devise in favor of the petitioner which is null and void in
violation of Art. 739 and 1028.

Issue: Whether or not the court can pass on the intrinsic validity of a will

RULING: Yes, as an exception. But the general rule is that the court's area of inquiry is
limited to the an examination and resolution of the extrinsic validity of the will. This general
rule is however not inflexible and absolute. Given exceptional circumstances, the probate
court is not powerless to do what the situation constrains it to do and may pass upon certain
provisions of the will. The will itself admitted on its face the relationship between the testator
and the petitioner.

The will was validly executed in accordance with law but the court didn't find it to serve a
practical purpose to remand the nullified provision in a separate action for that purpose only
since in the probate of a will, the court does not ordinarily look into the intrinsic validity of
its provisions.

The devisee is invalid by virtue of Art. 739 which voids a donation made between persons
guilty of adultery/concubinage at the time of the donations. Under Art, 1028 it is also
prohibited.

Intestate Estate of Petra V. Rosales.

Irenea C. Rosales v. Fortunato Rosales, et. al.
G.R. No. L-40789, February 27, 1987

FACTS:

Mrs. Petra Rosales died intestate. She was survived by her husband
Fortunato and their two children Magna and Antonio. Another child,
Carterio Rosario, predeceased her, leaving behind a child,
Macikequerox, and his widow Irenea, the herein petitioner. Magna
instituted the proceedings for the settlement of the estate of
the deceased. The trial court ordered that Fortunato, Magna,
Macikequerox and Antonio be entitled each to share in the estate of
decedent. Irenea, on the other hand, insisted in getting a share of the
estate in her capacity as the surviving spouse of the late
Carterio Rosales, son of the deceased, claiming that she is a
compulsory heir of her mother-in-law.

ISSUE:

Whether or not Irenea is entitled to inherit from her mother-in-law.

RULING:

No. Under the law, intestate or legal heirs are classified into two
groups, namely, those who inherit by their own right, and those
who inherit by the right of representation. There is no provision in the
Civil Code which states that a widow (surviving spouse) is an intestate
heir of her mother-in-law. The law has already meticulously
enumerated the intestate heirs of a decedent. The Court held that
Irenea misinterpreted the provision of Article 887 because the
provision refers to the estate of the deceased spouse in which case the
surviving spouse is a compulsory heir. It does not apply to the estate of
a parent-in-law. Therefore, the surviving spouse is considered a third
person as regards the estate of the parent-in-law.

Mariquita Sumaya and Laguna Agro-Industrial CoconutCooperative v. IAC

et.alGR 68843-44FACTS:

Raul Balantakbo inherited from two different ascendants two sets ofparcels of
property, one from his father and the other from hismaternal grandmother. Raul
died intestate, single and without anyissue, leaving Consuelo Balantakbo, his
mother as sole heir.Subsequently, Consuelo adjudicated to herself the property
inaffidavit stating that she is the sole and lone ascendant heir of Raulwho left the
properties inherited from his father and grandmother.Consuelo sold the properties
to Mariquita Sumaya, who sold thesame to Villa Honorio Development Corporation
which subsequentlytransferred its right over the property in favor of Laguna Agro-
Industrial Coconut Cooperative. Certificates of title were issuedin

Agros name. However, such title do not contain any annotation o

fthe property being reservable in character. Two years after

Consuelos death, Amadeo et al, brothers, sisters, nephew and

nieces of Raul filed a civil case for the recovery of the parcels of landsold to Agro
alleging that such is subject of reserva troncal. Court aquo ruled in favor of
plaintiffs, finding Agro as not innocent

purchasers for value. The CA affirmed the lower courts decision and

ruled that there is no need to annotate the reservable interest ofreserves in

property covered by the certificate of title.

ISSUE:

Whether there is a need to annotate the reservable character of theproperty subject

of reserva troncal

RULING:

Yes. In a ruling decided by the Court, the reservable character of aproperty may be
lost to innocent purchasers for value and hence,the obligation is imposed on a
widowed spouse to annotate thereservable character of a property subject
of reserve viudal. Suchobligation is also applicable in reserva troncal. Moreover,
thepurpose of notation is nothing more than to afford the personsentitled to
reservation, if any, due protection against any act of thereservoir, which may make
it ineffective.

CollationArellano v. Pascual15 December 2010Facts:

Decedent Angel N. Pascual Jr. died intestate. His siblings,Amelia, Francisco and
Miguel were the only heirs that he left. Duringthe lifetime of Angel, he made a
donation of a parcel of land in favorof his sister, Amelia. Upon his death, his
brothers, Francisco andMiguel filed a Judicial Settlement of Intestate Estate of Angel.
In thesaid petition, the brothers alleged that the donation made by thedecedent to
their sister should be considered as an advancelegitime. They now pray that the
parcel of land donated be subjectof collation as to not violate their rights as heirs of
the decedent.

Issues:
Whether or not the parcel of land donated to Amelia maybe subject of collation.

Ruling:

NO.Collation takes place when there are compulsory heirs,one of its purposes being
to determine the legitime and the freeportion. If there is no compulsory heir, there
is no legitime to besafeguarded.In the instant case, the decedent left no compulsory
heirs,his brothers and sister being collateral relatives only. Hence, thedecedent not
having left any compulsory heir who is entitled to anylegitime, he was at liberty to
donate all his properties, even ifnothing was left for his siblings-collateral relatives
to inherit. Hisdonation to Amelia, his sister, assuming that it was valid, is deemedas
donation made to a stranger, chargeable against the free portionof the estate

G.R. No. L-31703 February 13, 1930

CARMEN G. DE PEREZ, trustee of the estate of Ana Maria Alcantara, plaintiff-

appellee,
vs.
MARIANO GARCHITORENA, and JOSE CASIMIRO, Sheriff of the Court of First
Instance of Manila, defendants-appellants.

L. D. Lockwood and Jose M. Casal for appellants.

Eduardo Gutierrez Repide and Leoncio B. Monzon for appellee.

ROMUALDEZ, J.:

The amount of P21,428.58 is on deposit in the plaintiff's name with the association
known as La Urbana in Manila, as the final payment of the liquidated credit of Ana Maria
Alcantara, deceased, whose heiress is said plaintiff, against Andres Garchitorena, also
deceased, represented by his son, the defendant Mariano Garchitorena.

And as said Mariano Garchitorena held a judgment for P7,872.23 against Joaquin
Perez Alcantara, husband of the plaintiff, Carmen G. de Perez, the sheriff pursuant to
the writ of execution issued in said judgment, levied an attachment on said amount
deposited with La Urbana.

The plaintiff, alleging that said deposit belongs to the fideicommissary heirs of the
decedent Ana Maria Alcantara, secured a preliminary injunction restraining the
execution of said judgment on the sum so attached. The defendants contend that the
plaintiff is the decedent's universal heiress, and pray for the dissolution of the injunction.
The court below held that said La Urbana deposit belongs to the plaintiff's children as
fideicommissary heirs of Ana Maria Alcantara, and granted a final writ of injunction.

The defendants insist in their contentions, and, in their appeal from the decision of the
trial court, assign the following errors:

1. The lower court erred in holding that a trust was created by the will of Doa
Ana Maria Alcantara.

2. The lower court erred in concluding and declaring that the amount of
P21,428.58 deposited with La Urbana is the property of the children of the
plaintiff as "herederos fidei-comisarios."

3. The lower court erred in making the injunction permanent and condemning
defendant to pay the costs.

The question here raised is confined to the scope and meaning of the institution of heirs
made in the will of the late Ana Maria Alcantara already admitted to probate, and whose
legal force and effect is not in dispute.

The clauses of said will relevant to the points in dispute, between the parties are the
ninth, tenth, and eleventh, quoted below:

Ninth. Being single and without any forced heir, to show my gratitude to my
niece-in-law, Carmen Garchitorena, of age, married to my nephew, Joaquin
Perez Alcantara, and living in this same house with me, I institute her as my sole
and universal heiress to the remainder of my estate after the payment of my
debts and legacies, so that upon my death and after probate of this will, and after
the report of the committee on claims and appraisal has been rendered and
approved, she will receive from my executrix and properties composing my
hereditary estate, that she may enjoy them with God's blessing and my own.

Tenth. Should my heiress Carmen Garchitorena die, I order that my whole estate
shall pass unimpaired to her surviving children; and should any of these die, his
share shall serve to increase the portions of his surviving brothers (and sisters)
by accretion, in such wise that my estate shall never pass out of the hands of my
heiress or her children in so far as it is legally possible.

Eleventh. Should my aforesaid heiress, Carmen Garchitorena, die after me while

her children are still in their minority, I order that my estate be administered by
my executrix, Mrs. Josefa Laplana, and in her default, by Attorney Ramon
Salinas and in his default, by his son Ramon Salinas; but the direction herein
 given must not be considered as an indication of lack of confidence in my
nephew Joaquin Perez Alcantara, whom I relieve from the duties of administering
my estate, because I recognize that his character is not adapted to management
and administration.

The appellants contend that in these clauses the testatrix has ordered a simple
substitution, while the appellee contends that it is a fideicommissary substitution.

This will certainly provides for a substitution of heirs, and of the three cases that might
give rise to a simple substitution (art. 774, Civil Code), only the death of the instituted
heiress before the testatrix would in the instant case give place to such substitution,
inasmuch as nothing is said of the waiver of inheritance, or incapacity to accept it. As a
matter of fact, however, clause XI provides for the administration of the estate in case
the heiress instituted should die after the testatrix and while the substitute heirs are still
under age. And it is evident that, considering the nature of simple substitution by the
heir's death before the testator, and the fact that by clause XI in connection with clause
X, the substitution is ordered where the heiress instituted dies after the testatrix, this
cannot be a case of simple substitution.

The existence of a substitution in the will is not and cannot be denied, and since it
cannot be a simple substitution in the light of the considerations above stated, let us
now see whether the instants case is a fideicommissary substitution.

In clause IX, the testatrix institutes the plaintiff herein her sole and universal heiress,
and provides that upon her death (the testatrix's) and after probate of the will and
approval of the report of the committee on claims and appraisal, said heiress shall
receive and enjoy the whole hereditary estate. Although this clause provides nothing
explicit about substitution, it does not contain anything in conflict with the idea of
fideicommissary substitution. The fact that the plaintiff was instituted the sole and
universal heiress does not prevent her children from receiving, upon her death and in
conformity with the express desire of the testatrix, the latter's hereditary estate, as
provided in the following (above quoted) clauses which cannot be disregarded if we are
to give a correct interpretation of the will. The word sole does not necessarily exclude
the idea of substitute heirs; and taking these three clauses together, such word means
that the plaintiff is the sole heiress instituted in the first instance.

The disposition contained in clause IX, that said heiress shall receive and enjoy the
estate, is not incompatible with a fideicommissary substitution (it certainly is
incompatible with the idea of simple substitution, where the heiress instituted does not
receive the inheritance). In fact the enjoyment of the inheritance is in conformity with the
idea of fideicommissary substitution, by virtue of which the heir instituted receives the
inheritance and enjoys it, although at the same time he preserves it in order to pass it
on the second heir. On this point the illustrious Manresa, in his Civil Code (Vol. 6, pp.
142 and 143, 5th ed.), says:

Or, what amounts to the same thing, the fideicommissary substitution, as held in
the Resolution of June 25, 1895, February 10, 1899, and July 19, 1909, requires
three things:

1. A first heir called primarily to the enjoyment of the estate.

2. An obligation clearly imposed upon him to preserve and transmit to a third

person the whole or a part of the estate.

3. A second heir.

To these requisites, the decision of November 18, 1918 adds another, namely
that the fideicommissarius be entitled to the estate from the time the testator
dies, since he is to inherit from the latter and not from the fiduciary. (Emphasis
ours.)

It appears from this quotation that the heir instituted or the fiduciary, as referred to in
articles 783 of the Civil Code, is entitled to enjoy the inheritance. And it might here be
observed, as a timely remark, that the fideicommissum arising from a fideicommissary
substitution, which is of Roman origin, is not exactly equivalent to, nor may it be
confused with, the English "trust."

It should also be noted that said clause IX vests in the heiress only the right to enjoy but
not the right to dispose of the estate. It says, she may enjoy it, but does not say she
may dispose of it. This is an indication of the usufruct inherent in fideicommissary
substitution.

Clause X expressly provides for the substitution. It is true that it does not say whether
the death of the heiress herein referred to is before or after that of the testatrix; but from
the whole context it appears that in making the provisions contained in this clause X, the
testatrix had in mind a fideicommissary substitution, since she limits the transmission of
her estate to the children of the heiress by this provision, "in such wise that my estate
shall never pass out of the hands of my heiress or her children in so far as it is legally
possible." Here it clearly appears that the testatrix tried to avoid the possibility that the
substitution might later be legally declared null for transcending the limits fixed by article
781 of the Civil Code which prescribed that fideicommissary substitutions shall be valid
"provided they do not go beyond the second degree."
Another clear and outstanding indication of fideicommissary substitution in clause X is
the provision that the whole estate shall pass unimpaired to the heiress's children, that
is to say the heiress is required to preserve the whole estate, without diminution, in
order to pass it on in due time to the fideicommissary heirs. This provision complies with
another of the requisites of fideicommissary substitution according to our quotation from
Manresa inserted above.

Lastly, clause XI more clearly indicates the idea of fideicommissary substitution, when a
provision is therein made in the event the heiress should die after the testatrix. That is,
said clause anticipates the case where the instituted heiress should die after the
testatrix and after receiving and enjoying the inheritance.

The foregoing leads us to the conclusion that all the requisites of a fideicommissary
substitution, according to the quotation from Manresa above inserted, are present in the
case of substitution now under consideration, to wit:

1. At first heir primarily called to the enjoyment of the estate. In this case the
plaintiff was instituted an heiress, called to the enjoyment of the estate, according
to clause IX of the will.

2. An obligation clearly imposed upon the heir to preserve and transmit to a third
person the whole or a part of the estate. Such an obligation is imposed in clause
X which provides that the "whole estate shall pass unimpaired to her (heiress's)
surviving children;" thus, instead of leaving the heiress at liberty to dispose of the
estate by will, or of leaving the law to take its course in case she dies intestate,
said clause not only disposes of the estate in favor of the heiress instituted, but
also provides for the disposition thereof in case she should die after the testatrix.

3. A second heir. Such are the children of the heiress instituted, who are referred
to as such second heirs both in clause X and in clause XI.

Finally, the requisite added by the decision of November 18, 1918, to wit, that the
fideicommissarius or second heir should be entitled to the estate from the time of the
testator's death, which in the instant case, is, rather than a requisite, a necessary
consequence derived from the nature of the fideicommissary substitution, in which the
second heir does not inherit from the heir first instituted, but from the testator.

By virtue of this consequence, the inheritance in question does not belong to the heiress
instituted, the plaintiff herein, as her absolute property, but to her children, from the
moment of the death of the testatrix, Ana Maria Alcantara.
Therefore, said inheritance, of which the amount referred to at the beginning, which is
on deposit with the association known as La Urbana in the plaintiff's name, is a part,
does not belong to her nor can it be subject to the execution of the judgment against
Joaquin Perez, who is not one of the fideicommissary heirs.

The judgment appealed from is affirmed, with costs against the appellant, Mariano
Garchitorena. So ordered.

2. G. de Perez v. Garchitorena (fideicommissary)

54 Phil. 431
Doctrine: Provision in the will that the whole estate shasll pass unimpaired to the
children of heiress in the event heiress should die after the testatrix, was held a
fideicommissary substitution. It implied an obligation to preserve and to transmit.
Necessary consequence derived from the nature of fideicommissary is that second
heir does not inherit from fiduciary but from testator.

FACTS: Ana instituted Carmen as her heir with the following stipulations in her will:

(a) Should Carmen die, the whole estate should pass unimpaired to Carmens
children.

(b) The estate should never pass out of the hands of Carmen and her children as
long as this was legally possible.

(c) Should Carmen die after Ana while Carmens children are still minors, the estate
would be administered by the executrix.

It should be noted that in the will, no express mention was made of a

fideicommissary substitution. Neither was there any statement as to whether
Carmen was to die before or after Ana. It was thus alleged that no fideicommissary
substitution was made, and so, after Carmens death, the property belonged to her
estate and not to the children as substitutes, and therefore, creditors could attach
the same.

HELD: The properties belonged to the children, and not to Carmens estate. This is
because all the requirements of a fideicommissary substitution are present here,
and consequently, the creditors cannot go against the property. The requisites for a
fideicommissary substitution are present because the first and second heirs exist, in
the proper relationship, and were both alive at the testatrixs death. The phrase
shall pass unimpaired and the phrase should never pass out of the hands, show
an obligation to
G.R. No. L-6746 August 31, 1954

ESPERANZA V. BUHAT, ET AL., plaintiffs-appellants,

vs.
ROSARIO BESANA, ETC., ET AL., defendants-appellees.

Vicente Abalajon for appellants.

Santiago Abela Vito for appellees.

PARAS, C.J.:

Jose M. Besana mortgaged his undivided one-half share in a lot in

favor of Bernales to secure an indebtedness. OCT was issued in
the name of Jose and Rosario Besana, brother and sister and on
said certificate the mortgage in favor of Bernales was noted.
Besana died and his portion passed to his Rosario Besana. Luis
Bernales also died and his mortgage credit against Jose M. Besana
was inherited by Antonio Bernales, who in turn transferred the
same to the herein plaintiffs, the indebtedness above referred to
remained unpaid hence the present action. defendandts filed a
motion to dismiss the complaint, on the ground that plaintiffs'
cause of action had prescribed,

Issue: Whether the action already has prescribed

Ruling: section 46 of the Land Registration Act, No. 496, speaks of

the title of the "registered owner" and refers to prescription or
adverse possession as a mode of acquiring ownership, the whole
philosophy of the law being merely to make a Torrens title
indefeasible and, without more, surely not to cause a registered
lien or encumbrance such as a mortgage and the right of action
to enforce
it imprescriptible as against the registered owner. The
important effect of the registration of a mortgage is obviously to
bind third parties.
 private respondent (AFPSLAI) filed a complaint for a sum of money against petitioner China
Banking. In its Answer,4 the petitioner admitted being the registered owner of the Home Notes,
instruments of indebtedness issued in favor of (FCFI) and were sold, transferred and assigned to
afpslai. Thus, the petitioner filed a Motion to Dismiss alleging that the real party in interest was
FCFI, which was not joined in the complaint, and that petitioner was a mere trustee of FCFI.

The trial court denied the motion to dismiss. Petitioner filed another Motion to Dismiss, this time
invoking prescription.