[G.R. No. 172172. February 24, 2009.
] The defendant is further directed to deliver the certificate of title of the land to the plainti who is entitled
SPS. ERNESTO V. YU AND ELSIE ONG YU, petitioners, vs. BALTAZAR N. PACLEB, (Substituted by
ANTONIETA S. PACLEB, LORNA PACLEB-GUERRERO, FLORENCIO C. PACLEB, and MYRLA C.
PACLEB), respondents.
DECISION
PUNO, C.J p:
Before the Court is a Petition filed under Rule 45 of the Rules of Court assailing: (i) the Decision 1 dated
August 31, 2005 of the Court of Appeals in CA-G.R. CV No. 78629 setting aside the Decision 2 dated
December 27, 2002 of the Regional Trial Court in Civil Case No. 1325-96; and (ii) the Resolution 3 dated
April 3, 2006 of the Court of Appeals denying reconsideration of the said decision. HICSTa
The facts are well established.
Respondent Baltazar N. Pacleb and his late first wife, Angelita Chan, are the registered owners of an
18,000-square meter parcel of land in Barrio Langcaan, Dasmarias, Cavite, covered by Transfer
Certificate of Title (TCT) No. T-118375 4 (Langcaan Property).
In 1992, the Langcaan Property became the subject of three (3) documents purporting to transfer its
ownership. On February 27, 1992, a Deed of Absolute Sale 5 was entered into between Spouses Baltazar
N. Pacleb and Angelita Chan and Rebecca Del Rosario. On May 7, 1992, a Deed of Absolute Sale 6 was
entered into between Rebecca Del Rosario and Ruperto L. Javier (Javier). On November 10, 1992, a
Contract to Sell 7 was entered into between Javier and petitioner spouses Ernesto V. Yu and Elsie Ong
Yu. In their contract, petitioner spouses Yu agreed to pay Javier a total consideration of P900,000. Six
hundred thousand pesos (P600,000) (consisting of P200,000 as previous payment and P400,000 to be
paid upon execution of the contract) was acknowledged as received by Javier and P300,000 remained
as balance. Javier undertook to deliver possession of the Langcaan Property and to sign a deed of
absolute sale within thirty (30) days from execution of the contract.
All the aforementioned sales were not registered.
On April 23, 1993, petitioner spouses Yu filed with the Regional Trial Court of Imus, Cavite, a Complaint
8 for specific performance and damages against Javier, docketed as Civil Case No. 741-93, to compel
the latter to deliver to them ownership and possession, as well as title to the Langcaan Property. In their
Complaint, they alleged that Javier represented to them that the Langcaan Property was not tenanted.
However, after they already paid P200,000 as initial payment and entered into an Agreement dated
September 11, 1992 for the sale of the Langcaan Property, they discovered it was tenanted by Ramon
C. Pacleb (Ramon). 9 Petitioner spouses demanded the cancellation of their agreement and the return
of their initial payment. Thereafter, petitioner spouses and Javier verified from Ramon if he was willing to
vacate the property and the latter was agreeable. Javier then promised to make arrangements with
Ramon to vacate the property and to pay the latter his disturbance compensation. Hence, they proceeded
to enter into a Contract to Sell canceling the Agreement mentioned. However, Javier failed to comply with
his obligations.
Javier did not appear in the proceedings and was declared in default. On September 8, 1994, the trial
court rendered a Decision, 10 the dispositive portion of which reads: aSEDHC
WHEREFORE, judgment is hereby rendered for the plainti and against the defendant based on the sale
of subject parcel of land to the former who is entitled thereby to the ownership and possession thereof
from the said defendant who is further directed to pay damages of Thirty Thousand Pesos (P30,000.00)
including attorney's fees and expenses incurred by the plainti in this case as a consequence.
to it as transferee and new owner thereof upon payment by the plainti of his balance of the purchase
price in the sum of Three Hundred Thousand Pesos (P300,000.00) with legal interest from date.
SO ORDERED.
The said Decision and its Certificate of Finality 11 were annotated on TCT No. T-118375 as Entry No.
2676-75 12 and Entry No. 2677-75, 13 respectively.
On March 10, 1995, petitioner spouses and Ramon and the latter's wife, Corazon Bodino, executed a
"Kusangloob na Pagsasauli ng Lupang Sakahan at Pagpapahayag ng Pagtalikod sa Karapatan." 14
Under the said agreement, petitioner spouses paid Ramon the amount of P500,000 in exchange for the
waiver of his tenancy rights over the Langcaan Property.
On October 12, 1995, respondent filed a Complaint 15 for annulment of deed of sale and other documents
arising from it, docketed as Civil Case No. 1199-95. He alleged that the deed of sale purportedly executed
between him and his late first wife and Rebecca Del Rosario was spurious as their signatures thereon
were
!2 of !105
forgeries. Respondent moved to have summons served upon Rebecca Del Rosario by publication since
the latter's address could not be found. The trial court, however, denied his motion. 16 Respondent then
moved to dismiss the case, and the trial court granted the motion in its Order 17 dated April 11, 1996,
dismissing the case without prejudice.
Meanwhile, on November 23, 1995, petitioner spouses filed an action for forcible entry against
respondent with the Municipal Trial Court (MTC). They alleged that they had prior physical possession of
the Langcaan Property through their trustee, Ramon, until the latter was ousted by respondent in
September 1995. The MTC ruled in favor of petitioner spouses, which decision was armed by the
Regional Trial Court. 18 However, the Court of Appeals set aside the decisions of the lower courts and
found that it was respondent who had prior physical possession of the property as shown by his payment
of real estate taxes thereon. 19 On May 29, 1996, respondent filed the instant case for removal of cloud
from title with damages to cancel Entry No. 2676-75 and Entry No. 2677- 75, the annotated Decision in
Civil Case No. 741-93 and its Certificate of Finality, from the title of the Langcaan Property. 20
Respondent alleged that the deed of sale between him and his late first wife and Rebecca Del Rosario,
who is not known to them, could not have been possibly executed on February 27, 1992, the date
appearing thereon. He alleged that on said date, he was residing in the United States 21 and his late first
wife, Angelita Chan, died twenty (20) years ago. 22 EcTaSC
On May 28, 1997, during the pendency of the instant case before the trial court, respondent died without
having testified on the merits of his case. Hence, he was substituted by his surviving spouse, Antonieta
S. Pacleb, and Lorna Pacleb -Guerrero, Florencio C. Pacleb and Myrla C. Pacleb representing the
children with the first wife. 23
On December 27, 2002, the trial court dismissed respondent's case and held that petitioner spouses are
purchasers in good faith. 24 The trial court ratiocinated that the dismissal of respondent's complaint for
annulment of the successive sales at his instance "sealed the regularity of the purchase" 25 by petitioner
spouses and that he "in eect admits that the said sale . . . was valid and in order". 26 Further, the trial
court held that the Decision in Civil Case No. 741-93 on petitioner spouses' action for specific
performance against Javier is already final and can no longer be altered. Accordingly, the trial court
ordered the cancellation of TCT No. T-118375 in the name of respondent and the issuance of a new title
in the name of petitioner spouses. The trial court also ordered the heirs of respondent and all persons
claiming under them to surrender possession of the Langcaan Property to petitioner spouses.
On appeal by respondent, the Court of Appeals reversed and set aside the decision of the trial court. 27
The Court of Appeals ruled that petitioner spouses are not purchasers in good faith and that the Decision
in Civil Case No. 741-93 did not transfer ownership of the Langcaan Property to them. Accordingly, the
appellate court ordered the cancellation of the annotation of the Decision in Civil Case No. 741-93 on the
title of the Langcaan Property. The Court of Appeals denied reconsideration of said decision. 28
Hence, this Petition.
Two issues are involved in the instant petition. The first is whether petitioner spouses are innocent
purchasers for value and in good faith. The second is whether ownership over the Langcaan Property
was properly vested in petitioner spouses by virtue of the Decision in Civil Case No. 741-93.
Petitioner spouses argue that they are purchasers in good faith. Further, they contend that the Court of
Appeals erred in finding that: "Ramon told him [Ernesto V. Yu] that the property is owned by his father,
Baltazar, and that he is the mere caretaker thereof" 29 since Ramon clarified that his father was the
former owner of the Langcaan Property. In support of their stance, they cite the following testimony of
petitioner Ernesto V. Yu:
Atty. Abalos:
Mr. Witness, you testified during the direct that you acquired the subject property from one Ruperto Javier,
when for the first time have you come to know Mr. Ruperto Javier?
A: I first came to know him in the year 1992 when he was accompanied by Mr. Kalagayan. He showed
me some papers to the oce. ICHDca
Q: Do you know the exact date Mr. Witness? A: I forgot the exact date, ma'am.
Q: More or less can you estimate what month? A: Sometime in February or March 1992.
Q: When you said that the subject property was oered to you for sale, what did you do Mr. Witness, in
preparation for a transaction?
A: I asked my lawyer Atty. Florencio Paredes to check and verify the Deed of Sale.
Q: And after Atty. Florencio Paredes verified the document you decided to buy the property?
A: No, ma'am. We visited the place.
Q: When was that?
3! of !105
A: I could not remember the exact date but I visited the place and I met the son, Ramon Pacleb. I went
there in order to verify if the property is existing. When I verified that the property is existing Mr. Javier
visited me again to follow-up what decision I have but I told him that I will wait for my lawyer's advi[c]e.
Q: Mr. Witness, what particular instruction did you give to your lawyer?
A: To verify the title and the documents. Court:
Documents for the title? A: Yes, Your Honor.
Atty. Abalos:
When you were able to get the title in whose name the title was registered?
A: It was registered in the name of the older Pacleb. Court:
By the way Mr. Witness, when you said you met Ramon Pacleb the son of the owner of the property, was
he residing there or he was (sic) just went there? When you visited the property did you find him to be
residing in that property?
A: No, Your Honor. Atty. Abalos:
You mean to say Mr. Witness, you just met Mr. Ramon Pacleb in the place at the time you went there?
AIDcTE A: No, ma'am. He went to my oce with Mr.
Kalagayan. He was introduced to me at the Kelly Hardware. I do not know Mr. Ruperto Javier. He told
me that there is a property that [is] tenanted and occupied by the son Ramon Pacleb after that I went with
them to visit the place. On (sic) there he introduced me [to] Mr. Ramon Pacleb the caretaker of the
property and I told them that I will still look at the property and he gave me some documents and that
(sic) documents I gave it to my lawyer for verification.
Q: You said that Mr. Ruperto Javier went to your oce with Mr. Kalagayan, so the first time you visited
the property you did not see Mr. Ramon Pacleb there?
A: No, ma'am. When I went there I met Ramon Pacleb the caretaker and he was the one who showed
the place to us.
Q: Mr. Witness, since you visited the place you were able to see the allege[d] caretaker Mr. Ramon
Pacleb, did you ask him regarding the property or the whereabouts of the registered owner, did you ask
him? A: When Ruperto introduced me to Mr. Ramon Pacleb he told me that he is the son of the owner
and he is the caretaker and his father is in the States. He showed me the place, I verified and I saw the
monuments and I told him I will come back to check the papers and if it is okay I will bring with me the
surveyor.
Q: Could you estimate Mr. Witness, more or less what was the month when you were able to talk to Mr.
Ramon Pacleb?
A: I am not sure but it was morning of February. Q: So it was in February, Mr. Witness?
A: I am not sure if February or March. Q: But definitely. . .
A: Before I purchased the property I checked the property.
Q: But that was definitely after Mr. Ruperto oered to you for sale the subject property?
xxx xxx xxx Atty. Abalos:
Okay, Mr. Witness, you said that you talked to Mr. Ramon Pacleb and he told you that his father is the
owner of the property? ACTEHI
A: He told me that property is their former property and it was owned by them. Now, he is the tenant of
the property. 30 (Emphasis ours)
Petitioner spouses conclude that based on their personal inspection of the property and the
representations of the registered tenant thereon, they had no reason to doubt the validity of the deeds of
absolute sale since these were duly notarized. Consequently, the alleged forgery of Angelita Chan's
signature is of no moment since they had no notice of any claim or interest of some other person in the
property despite their diligent inquiry.
We find petitioner spouses' contentions without merit. At the outset, we note that in petitioner Ernesto V.
Yu's testimony, he stated that he inspected the Langcaan Property and talked with the tenant, Ramon,
before he purchased the same. However, in his Complaint for specific performance and damages which
he filed against Javier, he alleged that it was only after he had entered into an Agreement for the sale of
the property and his initial payment of P200,000 that he discovered that the property was indeed being
tenanted by Ramon who lives in the said farm, viz.:
8. Sometime on September 11, 1992, defendant came again to the Oce of plainti reiterating
his oer to sell said Lot No. 6853-D, containing an area of 18,000 square meters, at P75.00 per square
meters (sic). Defendant manifested to the plainti that if his oer is acceptable to the plainti, he binds
and obligates himself to pay the capital gains of previous transactions with the BIR and register subject
Lot No. 6853-D in his name (defendant). On these conditions, plainti accepted the oer and made [the]
initial payment of TWO HUNDRED THOUSAND PESOS (P200,000.00) to defendant by issuance and
delivery of plainti's personal check.
9. Sometime on September 11, 1992, plainti and defendant signed an AGREEMENT on the sale
of Lot No. 6853-D of the subdivision plan (LRC) Psd-282604, containing an area of 18,000 square meters,
more or less, located at Bo. Langcaan, Municipality of Dasmarinas, Province of Cavite, at a selling price
of
!4 of !105
P75.00 per square meter. A xerox copy of this AGREEMENT signed by the parties thereto is hereto
attached and marked as ANNEX "D" of this complaint.
10. Thereafter, however, plainti and defendant, with their surveyor discovered that subject Lot
No. 6853-D oered for sale to the plainti is indeed being tenanted by one RAMON PACLEB who lives
in the said farm. cACDaH
11. In view of the foregoing developments, plainti informed defendant that he wanted the
Agreement be cancelled and for the defendant to return the sum of TWO HUNDRED THOUSAND
PESOS (P200,000.00).
31 (Emphasis supplied)
This inconsistency casts grave doubt as to whether petitioner spouses personally inspected the property
before purchasing it.
More importantly, however, several facts should have put petitioner spouses on inquiry as to the alleged
rights of their vendor, Javier, over the Langcaan Property.
First, it should be noted that the property remains to be registered in the name of respondent despite the
two
(2) Deeds of Absolute Sale 32 purporting to transfer the Langcaan Property from respondent and his late
first wife, Angelita Chan, to Rebecca Del Rosario then from the latter to Javier. Both deeds were not even
annotated in the title of the Langcaan Property.
Second, a perusal of the two deeds of absolute sale reveals that they were executed only about two (2)
months apart and that they contain identical provisions. Third, it is undisputed that the Langcaan Property
is in the possession of Ramon, the son of the registered owner. Regardless of the representations given
by the latter, this bare fact alone should have made petitioner spouses suspicious as to the veracity of
the alleged title of their vendor. Moreover, as noted by the Court of Appeals, petitioner spouses could
have easily verified the true status of the Langcaan Property from Ramon's wife, since the latter is their
relative, as averred in paragraph 13 of their Answer in Civil Case No. 1199-95. 33 The case law is well
settled, viz.:
The law protects to a greater degree a purchaser who buys from the registered owner himself. Corollarily,
it requires a higher degree of prudence from one who buys from a person who is not the registered owner,
although the land object of the transaction is registered. While one who buys from the registered owner
does not need to look behind the certificate of title, one who buys from one who is not the registered
owner is expected to examine not only the certificate of title but all factual circumstances necessary for
him to determine if there are any flaws in the title of the transferor, or in his capacity to transfer the land.
This Court has consistently applied the stricter rule when it comes to deciding the issue of good faith of
one who buys from one who is not the registered owner, but who exhibits a certificate of title. 34
(Emphasis supplied) IEcDCa
Finally, as correctly pointed out by the Court of Appeals, the dismissal of Civil Case No. 1199-95 (the
action to annul the successive sales of the property) cannot serve to validate the sale to petitioner
spouses since the dismissal was ordered because Rebecca Del Rosario and Javier could no longer be
found. Indeed, the dismissal was without prejudice.
Based on the foregoing, therefore, petitioner spouses cannot be considered as innocent purchasers in
good faith.
We now go to the second issue.
Petitioner spouses argue that the decision of the Regional Trial Court in Civil Case No. 741-93 as to the
rightful owner of the Langcaan Property is conclusive and binding upon respondent even if the latter was
not a party thereto since it involved the question of possession and ownership of real property, and is
thus not merely an action in personam but an action quasi in rem.
In Domagas v. Jensen, 35 we distinguished between actions in personam and actions quasi in rem.
The settled rule is that the aim and object of an action determine its character. Whether a proceeding is
in rem, or in personam, or quasi in rem for that matter, is determined by its nature and purpose, and by
these only. A proceeding in personam is a proceeding to enforce personal rights and obligations brought
against the person and is based on the jurisdiction of the person, although it may involve his right to, or
the exercise of ownership of, specific property, or seek to compel him to control or dispose of it in
accordance with the mandate of the court. The purpose of a proceeding in personam is to impose,
through the judgment of a court, some responsibility or liability directly upon the person of the defendant.
Of this character are suits to compel a defendant to specifically perform some act or actions to fasten a
pecuniary liability on him. An action in personam is said to be one which has for its object a judgment
against the person, as distinguished from a judgment against the propriety (sic) to determine its state. It
has been held that an action in personam is a proceeding to enforce personal rights or obligations; such
action is brought against the person.
5! of !105
xxx xxx xxx
On the other hand, a proceeding quasi in rem is one brought against persons seeking to subject the
property of such persons to the discharge of the claims assailed. In an action quasi in rem, an individual
is named as defendant and the purpose of the proceeding is to subject his interests therein to the
obligation or loan burdening the property. Actions quasi in rem deal with the status, ownership or liability
of a particular property but which are intended to operate on these questions only as between the
particular parties to the proceedings and not to ascertain or cut o the rights or interests of all possible
claimants. The judgments therein are binding only upon the parties who joined in the action.
Civil Case No. 741-93 is an action for specific performance and damages filed by petitioner spouses
against Javier to compel performance of the latter's undertakings under their Contract to Sell. As correctly
held by the Court of Appeals, its object is to compel Javier to accept the full payment of the purchase
price, and to execute a deed of absolute sale over the Langcaan Property in their favor. The obligations
of Javier under the contract to sell attach to him alone, and do not burden the Langcaan Property. 36
cDIHES
We have held in an unbroken string of cases that an action for specific performance is an action in
personam. 37 In Cabutihan v. Landcenter Construction and Development Corporation, 38 we ruled that
an action for specific performance praying for the execution of a deed of sale in connection with an
undertaking in a contract, such as the contract to sell, in this instance, is an action in personam.

Being a judgment in personam, Civil Case No. 741-93 is binding only upon the parties properly impleaded
therein and duly heard or given an opportunity to be heard. 39 Therefore, it cannot bind respondent since
he was not a party therein. Neither can respondent be considered as privy thereto since his signature
and that of his late first wife, Angelita Chan, were forged in the deed of sale.

All told, we arm the ruling of the Court of Appeals finding that, as between respondent and petitioner
spouses, respondent has a better right over the Langcaan Property as the true owner thereof.

IN VIEW WHEREOF, the petition is DENIED. The decision of the Court of Appeals is armed. Costs
against petitioners.
SO ORDERED.
Carpio, Corona, Leonardo-de Castro and Brion, JJ., concur.

[G.R. No. 146874 * . July 20, 2006.] REPUBLIC OF THE PHILIPPINES, petitioner, vs.
SOCORRO P. JACOB, respondent. D E C I S I O N
CALLEJO, SR., J p:
Before this Court is a Petition for Review on Certiorari filed by the Republic of the Philippines assailing
the Decision 1 of the Court of Appeals (CA) in CA-G.R. CV No. 53606, which armed the ruling of the
Regional Trial Court (RTC), Branch 17, Tabaco, Albay, in Land Registration Case No. T-210. In the said
case, the RTC granted the application of private respondent Socorro P. Jacob for confirmation of her title
to Lot No. 4094, Cad-249, Malinao Cadastre of Plan AP-05-002078 in Barangay Balading, Malinao,
Albay.
The antecedents follow:
On August 14, 1970, then President Ferdinand E. Marcos issued Proclamation No. 739, "Establishing as
Reservation for the Purpose of the Exploration, Development, Exploitation and Utilization of Geothermal
Energy, Natural Gas and Methane Gas a Parcel of Land in the Province of Albay, Island of Luzon,
Philippines." Lot No. 4094 of the Malinao Cadastre, consisting of 15,520 square meters, is covered by
the said proclamation.
Nevertheless, on May 6, 1994, private respondent, a retired public school teacher, filed an application
with the RTC of Albay for the confirmation and registration of her alleged title over Lot No. 4094.
The Republic of the Philippines, through the Oce of the Solicitor General (OSG), opposed the
application for the following reasons:
3.That the claim of ownership in fee simple on the basis of Spanish title or grant can no longer be availed
of by the applicant/s who have failed to file an appropriate application for registration within the period of
six (6) months from February 16, 1976 as required by P.D. No. 892. From the records, it appears that the
instant application was filed on May 6, 1994.
4.That the parcel/s applied for is/are portions of the public domain belonging to the Republic of the
Philippines not subject to private appropriation. 2
Private respondent appended to her application the tracing cloth plan of the property under the name of
Sotero Bondal. The blue print, 3 dated February 27, 1991, was prepared and signed by Geodetic
Engineer Bonifacio C. del Valle and approved by Ernesto L. Llave, Chief, Regional Surveys Division of
the Lands
!6 of !105
Management Service. Per Report 4 of the Land Registration Authority dated September 27, 1994, the
property was the subject of an application for registration (Cadastral Case No. 42, GLRO Cadastral
Record No. 1324), but "no decision has been rendered thereon, or if there had been any, no copy of the
same was furnished to the [Land Registration Authority]." The report also states that the property is
covered by Free Patent No. V-13062 dated May 21, 1955. 5 Private respondent had also applied for a
free patent over the property, but withdrew her application in a Letter 6 dated October 27, 1994 addressed
to the Department of Environment and Natural Resources, Region V, Legaspi City.
Private respondent adduced the following evidence and factual allegations to support her application
before the RTC:
The previous owner of Lot No. 4094, Sotero Bondal, sold the property to Macario Monjardin, 7 a brother
of private respondent's mother, Josefa Monjardin Patricio. Macario declared the property in his name
under Tax Declaration (T.D.) No. 18854 8 in 1930, superseding T.D. No. 15956, and again in 1949 under
T.D. No. 7117. 9 Since Macario was residing in Manila and was unable to cultivate the property, he asked
his sister, Josefa to be his encargado. By then, private respondent was already a 17-year old substitute
teacher who then accompanied her mother in supervising the planting and harvesting of palay and the
improvement of the lot. SIcCEA
Sometime in 1946, Macario decided to marry. On January 31, 1946, he sold the property and executed
a deed of sale 10 in favor of the spouses Igmedio A. Patricio and Josefa Monjardin-Patricio, as vendees,
for P400.00. The spouses thereafter received their share of the produce as owners, but failed to declare
the property for taxation purposes under their names.
In 1947, Josefa Patricio died intestate and was survived by her husband Igmedio and private respondent.
T. D. No. 7117 was cancelled eective 1960 by T.D. No. 11602 11 under the name of "Egmidio A.
Patricio." The realty taxes due on the property from 1949 to 1959 were paid on April 16, 1959. 12 Igmedio
died intestate in 1968, and on May 8, 1971, private respondent executed an Adavit of Extrajudicial
Adjudication 13 where she declared that as sole heir of the spouses Igmedio Patricio, she was the sole
owner of the property.
Lot No. No. 4094 was declared for taxation purposes under the name of Socorro under T.D. No. 00530
14 eective 1985. On July 7, 1983, she paid the realty taxes over the property from 1960 to 1983, and
from 1983 to 1995. 15
When cross-examined, private respondent admitted that she had no copy of the deed of sale executed
by Sotero Bondal in favor of Macario Monjardin. 16
The Republic of the Philippines did not oer any evidence to support its opposition to the application.
On January 30, 1996, the trial court rendered judgment in favor of the applicant. The fallo of the decision
reads: WHEREFORE, Lot No. 4094 of Plan Ap-05-002078, Cad-249, Malinao Cadastre, more particularly
in the corresponding plan and technical description (Exhibits "O" and "N"), is hereby ordered
REGISTERED and CONFIRMED in the name of Socorro Jacob, of legal age, married to Elias Jacob,
and a resident of Barangay 7, Balintawak Street, Albay District, Legazpi City pursuant to paragraph (1),
Section 14 of the Presidential Decree No. 1529, otherwise known as the Property Registration Decree.
Once this decision becomes final, let the corresponding decree and Original Certificate of Title be issued
in favor of said applicant.
SO ORDERED. 17
The Republic of the Philippines, through the Oce of the Solicitor General, appealed the decision to the
CA on the following ground:
THE HONORABLE COURT ERRED IN FINDING THAT APPELLEE HAS A REGISTRABLE RIGHT
OVER LOT NO. 4049 OF THE MALINAO CADASTRE AND THAT H E R P O S S E S S I O N A N D T
H A T O F H E R PREDECESSORS-IN-INTEREST OVER THE SAID LOT FOR MORE THAN TWENTY
SEVEN (27) YEARS WAS IN THE CONCEPT OF OWNER. 18
The OSG averred that private respondent failed to prove her claim that the original owner of the property,
Sotero Bondal, sold the property to her uncle Macario Monjardin. It was likewise pointed out that private
respondent admitted that she had no copy of any such deed of sale. The fact that the property was
declared under the name of Sotero Bondal in 1991 (as shown by the tracing cloth plan approved by the
Land Registration Authority on February 27, 1991) negates private respondent's claim that the property
was sold to Monjardin. Even assuming the existence of such sale, the OSG claimed that private
respondent still failed to prove that her predecessors-in-interest had exclusive, open and adverse
occupation under a bona fide claim of ownership over the property since June 12, 1945 or earlier, up to
August 14, 1970 when the
7! of !105
property was declared as a reservation under Proclamation No. 739. 19
Private respondent opted not to file any brief.
On January 20, 2001, the CA rendered judgment arming the appealed decision. It declared that
although private respondent failed to adduce in evidence the deed of sale executed by Sotero Bondal in
favor of Macario Monjardin, her testimony that the sale took place was enough. Her claims were likewise
buttressed by her documentary evidence, and thus she was able to muster the requisite quantum of
evidence to prove exclusive, open, and continuous possession under a bona fide claim of ownership for
the requisite period of time before August 14, 1970. According to the appellate court, the bare fact that
private respondent failed to present any evidence to corroborate such testimony did not render it self-
serving.
The Republic of the Philippines, now petitioner, filed the instant petition, assailing the decision of the CA
on the following grounds:
A Under the Regalian doctrine, all lands not otherwise appearing to be clearly within private ownership are
THE COURT OF APPEALS GRAVELY ERRED IN RULING THAT RESPONDENT HAS ESTABLISHED
BY C L E A R A N D C O N V I N C I N G E V I D E N C E H E R POSSESSION AND THAT OF HER
PREDECESSOR-IN-INTEREST WITHIN THE PERIOD AND IN THE CONCEPT REQUIRED BY LAW.
B beyond the commerce of man and not susceptible of private appropriation and acquisitive prescription.
THE COURT OF APPEALS GRAVELY ERRED IN RULING THAT RESPONDENT ACQUIRED A
VESTED RIGHT OVER THE SUBJECT PARCEL OF LAND EVEN BEFORE THE EFFECTIVITY OF
PROCLAMATION NO. 739 OF AUGUST 14, 1970. 20
The parties reiterated their arguments in the CA to support their respective claims in this Court.
The petition is meritorious.
Section 48(b) of Commonwealth Act No. 141, as amended by Republic Act No. 1942, reads:
Section 48.The following described citizens of the Philippines, occupying lands of the public domain or
claiming to own any such lands or an interest therein, but whose titles have not been perfected or
completed, may apply to the Court of First Instance of the province where the land is located for
confirmation of their claims and the issuance of a certificate of title therefor, under the Land Registration
Act, to wit:
(b)Those who by themselves or through their predecessors in-interest therein have been in open,
continuous, exclusive, and notorious possession and occupation of agricultural lands of the public
domain, under a bona fide claim of acquisition of ownership, for at least thirty years immediately
preceding the filing of the application for confirmation of title except when prevented by war or force
majeure. These shall be conclusively presumed to have performed all the conditions essential to a
Government grant and shall be entitled to a certificate of title under the provisions of this chapter.
This provision was further amended by Presidential Decree (P.D.) No. 1903 by substituting the phrase
"for at least thirty years" with "since June 12, 1945," thus:
Sec. 4.The provisions of Section 48(b) and Section 48(c), Chapter VIII, of the Public Land Act are hereby
amended in the sense that these provisions shall apply only to alienable and disposable lands of the
public domain which have been in open, continuous, exclusive and notorious possession, and occupation
by the applicant himself or through his predecessor-in-interest, under a bona fide claim of acquisition of
ownership, since June 12, 1945 (emphasis supplied).
Section 14(1) of P.D. No. 1529, otherwise known as the Property Registration Decree, likewise provides:
SEC. 14.Who may apply. The following persons may file in the proper Court of First Instance [now
Regional Trial Court] an application for registration of title to land, whether personally or through their
duly authorized representatives:
(1)Those who by themselves or through their predecessors-in-interest have been in open, continuous,
exclusive and notorious possession and occupation of alienable and disposable lands of the public
domain under a bona fide claim of ownership since June 12, 1945, or earlier (emphasis supplied).
HCaEAT
Applicants for confirmation of imperfect title must, therefore, prove the following: (a) that the land forms
part of the disposable and alienable agricultural lands of the public domain; and (b) that they have been
in open, continuous, exclusive, and notorious possession and occupation of the same under a bona fide
claim of ownership either since time immemorial or since June 12, 1945. 21
presumed to belong to the State. The presumption is that lands of whatever classification belong to the
!8 of !105
State. 22 Unless public land is shown to have been reclassified as alienable or disposable to a private
person by the State, it remains part of the inalienable public domain. Property of the public domain is
Occupation thereof in the concept of owner no matter how long cannot ripen into ownership and be
registered as a title. 23 The statute of limitations with regard to public agricultural lands does not operate
against the State unless the occupant proves possession and occupation of the same after a claim of
ownership for the required number of years to constitute a grant from the State. 24
No public land can be acquired by private persons without any grant from the government, whether
express or implied. It is indispensable that there be a showing of a title from the State. The rationale for
the period "since time immemorial or since June 12, 1945" lies in the presumption that the land applied
for pertains to the State, and that the occupants or possessor claim an interest thereon only by virtue of
their imperfect title as continuous, open and notorious possession.
In the case at bar, when private respondent filed her application with the RTC on May 6, 1994, Lot No.
4094 was no longer alienable and disposable property of the public domain, since as of August 14, 1970,
by virtue of Proclamation No. 739, it was segregated from the public domain and declared part of the
reservation for the development of geothermal energy. 25 Private respondent filed her application for
confirmation 24 years after the said proclamation was issued; thus, the period of her possession and
occupancy after such proclamation can no longer be tacked in favor of the claimant. 26
The Court notes that on October 25, 1975, the Secretary of Justice issued an opinion 27 stating that
Proclamation No. 739 was without prejudice to the vested rights of individuals/applicants who had fully
complied with all the requirements under the Public Land Law for the acquisition of ownership as alienable
and disposable. It bears stressing, however, that one claiming private rights under the Public Land Act,
as amended, must prove by clear and convincing evidence that all the substantive requisites for
acquisition of public lands (along with the procedural) had been complied with.
As pointed out by petitioner, private respondent failed to adduce clear and convincing evidence that by
August 14, 1970, she had already acquired ownership over the property by herself or through her
predecessors-in-interest through open, continuous,
For August 18, 2017 exclusive and notorious possession and occupation of the property since 1945 or
earlier.
Indeed, the law speaks of "possession and occupation." Possession is broader than occupation because
it includes constructive possession. Unless, therefore, the law adds the word "occupation," it seeks to
delimit the all-encompassing eect of constructive possession . Taken together with the words
"continuous," "exclusive" and "notorious," the word "occupation" seems to highlight the facts that for an
applicant to qualify, her possession of the property must not be a mere fiction.
Actual possession of a land consists in the manifestation of acts of dominion of such a nature as a party
would naturally exercise over her own property. 28 A mere casual cultivation of portions of land by the
claimant does not constitute sucient basis for a claim of ownership. Such possession is not exclusive
and notorious as it gives rise to a presumptive grant from the State. 29 The applicant is burdened to oer
proof of specific acts of ownership to substantiate the claim over the land. 30 The good faith of the person
consists in the reasonable belief that the person from whom she received the property was the owner
thereof and could transfer ownership. 31
While tax receipts and tax payment receipts themselves do not convincingly prove title to the land, 32
these are good indicia of possession in the concept of an owner, for no one in his right mind would pay
taxes for a property that is not in his actual or, at least, constructive possession. 33 They constitute, at
the least, proof that the holder has a claim of title over the property, particularly when accompanied by
proof of actual possession. 34 The voluntary declaration of a piece of property for taxation purposes not
only manifests one's sincere and honest desire to obtain title to the property, but also announces an
adverse claim against the State and all other interested parties with an intention to contribute needed
revenues to the government. Such an act strengthens one's bona fide claim of acquisition of ownership.
35
In this case, however, private respondent failed to oer in evidence the deed of sale purportedly executed
by Sotero Bondal in favor of Macario Monjardin as vendee. On cross-examination, she admitted that the
only deed of sale she had was the deed of absolute sale Macario Monjardin executed in favor of her
parents, the spouses Igmedio Patricio . The documentary evidence adduced by private respondent even
belies her claim that Sotero Bondal sold the property to her uncle. She even failed to identify "B.C.
Monjardin," much less explain whether such person was really her uncle. 36 She even failed to adduce
in
!9 of !105
evidence any tax declaration over the property under his name and that he paid the realty taxes for the
property from 1930 to 1946.
Of great significance is private respondent's "promise" to submit proof based on the records in the
Register of Deeds and other government agencies showing that Sotero Bondal sold the property to
Macario Monjardin; and that if such records had been destroyed during the Second World War, she would
submit proof of said destruction:
QWho is this Sotero Bondal?
AThe original owner of the lot from whom my uncle bought the property.
QDo you have any document that your uncle Macario Monjardin acquired this property from Sotero
Bondal? ANone. That was the only document executed both by my parents and my uncle.
QSo, there is a gap now to prove that your uncle, Macario Monjardin was able to acquire this from Sotero
because it appears from the survey that the owner is still Sotero Bondal.
AYes, sir.
QSo, as of now you do not have any document?
AYou know during the war years everything was disturbed. So that is the only document that I have
found.
QSo, there is a need for you to submit that to the Court because ocial documents show that the property
is still in the name of Sotero Bondal. Are you going to prove that before this Court?
AI have to get from the cadastral oce? PROS. BOCALBOS:
It is up to your counsel to secure that. Just to show continuity of ownership of the land from the original
owner, Sotero Bondal. As far as this witness is concerned, Your Honor, no more cross-examination
except to submit the document which we require to show contin[u]ous possession and ownership of the
land.
ATTY. RAESES:
Your Honor please, we want to manifest before this Court that as far as that sale is concerned we cannot
assure the Court that we can produce that document. So I'm already manifesting this so that the
distinguished Prosecutor, Your Honor, will not oblige us to produce that. If we cannot produce that we
will leave our evidence to the Honorable Court.
COURT:
It is the observation that most of the records especially those that have been archived were lost during
the war. PROS. OCALBOS:
Yes, Your Honor. But it is a suggestion that in cases like this, you have to secure a certification from
dierent agencies that all the records were already destroyed because of the war or whatever. So, they
are going to
For August 18, 2017 execute again an adavit of ownership of the property tracing all the dates from the
predecessor, how this property was acquired by Macario Monjardin. That is an armation of the
ownership of the land. As of this date there are still documents showing that the property is owned by
Sotero Bondal otherwise from the date of sale, January 31, 1946 from Macario Monjardin to the
petitioner's parents only shows that he was the owner of the property but without proving how he was
able to secure this from Sotero Bondal.
ATTY. RAESES:
Your Honor please, we agree with counsel. If I can only have a copy of that it will be the best evidence
to prove possession. But I must be frank, because pf the years that have passed and because of the
Pacific War that occurred in the Philippines. The floods and the natural calamities and time, Your Honor,
I cannot guarantee. But at any rate I filed this original land registration case in accordance with P.D. 1529
that since this is still a public land, all I have to prove here is the continuous possession at least for 30
years from 1936 continuously up to the present.
PROS. BOCALBOS:
There is even a gap from that statement, "from 1936", wherein the property was sold in 1946.
COURT:
That was sold to the uncle. PROS. BOCALBOS:
But prior to that date there was no mention of Macario Monjardin how he was able to acquire this property.
So, he could have executed some document that he was the owner at that time when he sold the property.
So, there is a gap from the possession and ownership of the property from Sotero Bondal to Macario
Monjardin. ATTY. RAESES:
The requirement in the application is to show that there is a continuous, exclusive possession of the land.
PROS. BOCALBOS:
We are tracing this, Your Honor, to protect the interest of the previous owner, not only the government.
That is only a suggestion. If they could secure from the Bureau of Lands or from any other agency that
the records were already lost from the time Sotero Bondal owned the property so that they can execute
another document an adavit of ownership tracing the date and how Sotero Bondal acquired the
property. 37 However, private respondent failed to comply with her undertaking and rested her case
without presenting said evidence. ICTaEH

Significantly, the spouses Igmedio Patricio applied for a free patent over the property after the Second
World War, which, according to private respondent, was rejected by the Bureau of Lands. 38 Private
respondent's testimony is further belied by the request
!10 of 105!

to withdraw her application for a free patent over Lot No. 4094 which she made on October 27, 1994. 39
The records also show that the property is the subject of Cadastral Case No. 42, G.L.R.O. No. 1324 and
there is no evidence on record that this case has been terminated. There are thus two applications for
registration of the same lot: (1) the application of private respondent in the court below; and (2) Cadastral
Case No. 42.

Furthermore, the fact that the blue print copy of the tracing cloth plan covering the subject lot as of 1991
was still in the name of Sotero Bondal is proof that not all the records of the Land Management Authority
relative to the property had been lost. Unless and until respondent oered credible evidence that
Monjardin had purchased the property from Bondal, it cannot be said that the spouses Igmedio Patricio
acquired the rights and interests of Bondal over the property through Monjardin; private respondent
cannot even tack her own possession of the property to that of her parents. In fact, she failed to adduce
evidence that her uncle had been in open, continuous and adverse possession of the property. While she
claimed that her mother was designated as encargado, private respondent failed to even mention the
portion of the property that was cultivated, or at least where and who planted the palay. Such declaration
(that Macario designated her mother as encargado) without more does not constitute preponderant
evidence to prove adverse, continuous, open, public, and peaceful possession in the concept of owner.
Private respondent's testimony that after her parents purchased the lot, they began receiving the share
of the produce of the property does not in itself constitute proof of such adverse possession.

There is thus no evidence that the parents of private respondent ever had open, continuous, adverse and
actual possession of Lot No. 4094.

IN LIGHT OF ALL THE FOREGOING, the petition is GRANTED. The appealed decision of the Court of
Appeals in CA-G.R. CV No. 53606 is SET ASIDE. The Regional Trial Court is ordered to DISMISS private
respondent's application for confirmation of title over Lot No. 4094.

SO ORDERED.

Panganiban, C.J., Ynares-Santiago, Austria-Martinez and Chico-Nazario, JJ., concur

[G.R. No. L-15385. June 30, 1960.]
ALEJANDRA BUGARIN VDA. DE SARMIENTO, plainti-appellee, vs. JOSEFA R. LESACA, defendant-
appellant.
Juan R. Arbizo for appellee. Pastor de Castro for appellant.
D E C I S I O N BAUTISTA ANGELO, J p:
On December 31, 1949, plainti filed a complaint in the Court of First Instance of Zambales praying for
the rescission of the contract of sale executed between her and defendant for failure of the latter to place
the former in the actual physical possession of the lands she bought.
After issues were joined, the parties submitted the case for decision upon the following stipulation of
facts: that on January 18, 1949, plainti bought from defendant two parcels of land for P5,000; that after
the sale, plainti tried to take actual physical possession of the lands but was prevented from doing so
by one Martin Deloso who claims to be the owner thereof; that on February 1, 1949, plainti instituted an
action before the Tenancy Enforcement Division of the Department of Justice to oust said Martin Deloso
from the possession of the lands, which action she later abandoned for reasons known only to her; that
on December 12, 1949, plainti wrote defendant asking the latter either to change the lands sold with
another of the same kind and class or to return the purchase price together with the expenses she had
incurred in the execution of the sale, plus 6 per cent interest; and that since defendant did not agree to
this proposition as evidenced by her letter dated December 21, 1949, plainti filed the present action.
On April 11, 1957, the trial court rendered judgment declaring the deed of sale entered into between
plainti and defendant rescinded, and ordering the latter to pay the former the sum of P5,000,
representing the purchase price of the lands, plus the amount of P50.25 which plainti spent for the
execution and registration of the deed of sale, with legal interest on both sums from January 18, 1949.
Defendant, in due time, appealed to the Court of Appeals, but the case was certified to us on the ground
that the questions involved are purely legal.
The first issue posed by appellant is whether the execution of the deed of sale in a public document
(Exhibit A) is equivalent to delivery of possession of the lands sold to appellee thus relieving her of the
obligation to place appellee in actual possession
!11 of 105!
thereof. Articles 1461 and 1462 of the old Civil Code provide:
"ART. 1461. The vendor is bound to deliver and warrant the thing which is the subject-matter of the sale.
"ART. 1462. The thing sold shall be deemed delivered when the vendee is placed in the control and
possession thereof.
"If the sale should be made by means of a public instrument, the execution thereof shall be equivalent to
the delivery of the thing which is the subject-matter of the contract unless the contrary appears or is
clearly to be inferred from such instrument.
From the above it is clear that when a contract of sale is executed the vendor is bound to deliver to the
vendee the thing sold by placing the vendee in the control and possession of the subject-matter of the
contract. However, if the sale is executed by means of a public instrument, the mere execution of the
instrument is equivalent to delivery unless the contrary appears or is clearly to be inferred from such
instrument.
The question that now arises is: Is there any stipulation in the sale in question from which we can infer
that the vendor did not intend to deliver outright the possession of the lands to the vendee? We find none.
On the contrary, it can be clearly seen therein that the vendor intended to place the vendee in actual
possession of the lands immediately as can be inferred from the stipulation that the vendee "takes actual
possession thereof . . . with full rights to dispose, enjoy and make use thereof in such manner and form
as would be most advantageous to herself." The possession referred to in the contract evidently refers
to actual possession and not merely symbolical inferable from the mere execution of the document.
Has the vendor complied with this express commitment? she did not. As provided in Article 1462, the
thing sold shall be deemed delivered when the vendee is placed in the control and possession thereof,
which situation does not here obtain because from the execution of the sale up to the present the vendee
was never able to take possession of the lands due to the insistent refusal of Martin Deloso to surrender
them claiming ownership thereof. And although it is postulated in the same article that the execution of a
public document is equivalent to delivery, this legal fiction only holds true when there is no impediment
that may prevent the passing of the property from the hands of the vendor into those of the vendee. This
is what we said in a similar case:
"The Code imposes upon the vendor the obligation to deliver the thing sold. The thing is considered to
be delivered when it is placed 'in the hands and possession of the vendee.' (Civ. Code, art. 1462.) It is
true that the same article declares that the execution of a public instrument is equivalent to the delivery
of the thing which is the object of the contract, but, in order that this symbolic delivery may produce the
eect of tradition, it is necessary that the vendor shall have had such control over the thing sold that, at
the moment of the sale, its material delivery could have been made. It is not enough to confer upon the
purchaser the ownership and right of possession. The thing sold must be placed in his control. When
there is no impediment whatever to prevent the thing sold passing into the tenancy of the purchaser by
the sole will of the vendor, symbolic delivery through the execution by the sole will of the vendor, symbolic
delivery through the execution of a public instrument is sucient . But if, notwithstanding the execution
of the instrument, the purchaser cannot have the enjoyment and material tenancy of the thing and make
use of it himself or through another in his name, because such tenancy and enjoyment are opposed by
the interposition of another will, then fiction yields to reality the delivery has not been eected."
(Addison vs. Felix and Tioco, 38 Phil., 404; See also Garchitorena vs. Almeda, 48 O. Gaz., No. 8, 3432;
3437)
The next question to resolve is: Can plainti rescind the contract of sale in view of defendant's failure to
deliver the possession of the lands?
We are inclined to uphold the armative. While defendant contends that rescission can be availed of
only in the cases enumerated in Articles 1291 and 1292 of the old civil Code and being a subsidiary
remedy (Article 1294) it can only be resorted to when no other remedy is available, yet we agree with
plainti's contention that this action is based on Article 1124 of the same Code, which provides:
"ART. 1124. The right to resolve reciprocal obligations, in case one of the obligors should fail to comply
with that which is incumbent upon him, is deemed to be implied.
"The person prejudiced may choose between exacting the fulfillment of the obligation or its resolution
with indemnity for losses and payment of interest in either case. He may also demand the resolution of
the obligation even after having elected its fulfillment, should the latter be found impossible.
Undoubtedly, in a contract of purchase and sale the obligation of the parties is reciprocal, and, as
provided by the law, in case one of the parties fails to comply
!12 of 105!
with what is incumbent upon him to do, the person prejudiced may either exact the fulfillment of the
obligation or rescind the sale. Since plainti chose the latter alternative, it cannot be disputed that her
action is in accordance with law.
"We agree with the trial court that there was no fraud in the transaction in question but rather a non-
fulfillment by the plainti-appellee C. N. Hodges of his obligation, as vendor, to deliver the things, which
were the subject-matter of the contract, to the defendant-appellant Alberto Granada, as purchaser thereof
(article 1461, Civil Code), and place them in the latter's control and possession (article 1462, Civil Code)
which was not done. Inasmuch as the obligations arising from the contract of purchase and sale, Exhibit
A, which was entered into by the plainti-appellee and the defendant-appellant, are reciprocal, and the
former had failed to comply with that which was incumbent upon him, the latter has the implied right to
resolve them, and he may choose between exacting from the vendor the fulfillment of the obligation or
its resolution with indemnity for damages and payment of interest in either case (article 1124, Civil Code).
Inasmuch as the defendant-appellant had chosen to rescind the aforesaid contract of purchase and sale
in his cross-complaint, there arose the necessity, on the part of the plainti- appellee, to return the
purchase price with interest thereon, and on the part of the defendant-appellant, to restore the things
which were the subject-matter thereof, in case he had received them (article 1295, Civil Code)." (Hodges
vs. Granada, 59 Phil., 429, 432; See also Pabalan vs. Velez, 22 Phil., 29; Addison vs. Felix and Tioco,
supra; Rodriguez vs. Flores, 43 O. Gaz., No. 6, 2247.)

Wherefore, the decision appealed from is armed, with costs against defendant-appellant.

Paras, C. J., Bengzon, Padilla, Montemayor, Concepcion, Reyes, J. B. L., Barrera and Gutierrez David,
JJ., concur.
EN BANC
[G.R. No. 179987. April 29, 2009.] HEIRS OF MARIO MALABANAN, petitioner, vs. REPUBLIC OF THE
PHILIPPINES, respondent.
D E C I S I O N TINGA, J p:
One main reason why the informal sector has not become formal is that from Indonesia to Brazil, 90
percent of the informal lands are not titled and registered. This is a generalized phenomenon in the so-
called Third World. And it has many consequences. STHDAc
xxx xxx xxx
The question is: How is it that so many governments, from Suharto's in Indonesia to Fujimori's in Peru,
have wanted to title these people and have not been able to do so eectively? One reason is that none
of the state systems in Asia or Latin America can gather proof of informal titles. In Peru, the informals
have means of proving property ownership to each other which are not the same means developed by
the Spanish legal system. The informals have their own papers, their own forms of agreements, and their
own systems of registration, all of which are very clearly stated in the maps which they use for their own
informal business transactions.
If you take a walk through the countryside, from Indonesia to Peru, and you walk by field after field in
each field a dierent dog is going to bark at you. Even dogs know what private property is all about. The
only one who does not know it is the government. The issue is that there exists a "common law" and an
"informal law" which the Latin American formal legal system does not know how to recognize.
Hernando De Soto 1
This decision inevitably aects all untitled lands currently in possession of persons and entities other than
the Philippine government. The petition, while unremarkable as to the facts, was accepted by the Court
en banc in order to provide definitive clarity to the applicability and scope of original registration
proceedings under Sections 14 (1) and 14 (2) of the Property Registration Decree. In doing so, the Court
confronts not only the relevant provisions of the Public Land Act and the Civil Code, but also the reality
on the ground. The countrywide phenomenon of untitled lands, as well as the problem of informal
settlement it has spawned, has unfortunately been treated with benign neglect. Yet our current laws are
hemmed in by their own circumscriptions in addressing the phenomenon. Still, the duty on our part is
primarily to decide cases before us in accord with the Constitution and the legal principles that have
developed our public land law, though our social obligations dissuade us from casting a blind eye on the
endemic problems.
I.
On 20 February 1998, Mario Malabanan filed an application for land registration covering a parcel of land
identified as Lot 9864-A, Cad- 452-D, Silang Cadastre, 2 situated in Barangay Tibig, Silang Cavite, and
consisting of 71,324 square meters. Malabanan claimed that he had purchased the property from
Eduardo Velazco, 3 and that he and his predecessors-in-interest had been in open, notorious, and
continuous adverse and peaceful possession of the land for more than thirty (30) years. HaSEcA
!13 of 105!
The application was raed to the Regional Trial Court of (RTC) Cavite-Tagaytay City, Branch 18. The
Oce of the Solicitor General (OSG) duly designated the Assistant Provincial Prosecutor of Cavite, Jose
Velazco, Jr., to appear on behalf of the State. 4 Apart from presenting documentary evidence, Malabanan
himself and his witness, Aristedes Velazco, testified at the hearing. Velazco testified that the property
was originally belonged * to a twenty-two hectare property owned by his great-grandfather, Lino Velazco.
Lino had four sons Benedicto, Gregorio, Eduardo and Esteban the fourth being Aristedes's
grandfather. Upon Lino's death, his four sons inherited the property and divided it among themselves.
But by 1966, Esteban's wife, Magdalena, had become the administrator of all the properties inherited by
the Velazco sons from their father, Lino. After the death of Esteban and Magdalena, their son Virgilio
succeeded them in administering the properties, including Lot 9864-A, which originally belonged to his
uncle, Eduardo Velazco. It was this property that was sold by Eduardo Velazco to Malabanan. 5
Assistant Provincial Prosecutor Jose Velazco, Jr. did not cross- examine Aristedes Velazco. He further
manifested that he "also [knew] the property and I arm the truth of the testimony given by Mr. Velazco."
6 The Republic of the Philippines likewise did not present any evidence to controvert the application.
Among the evidence presented by Malabanan during trial was a Certification dated 11 June 2001, issued
by the Community Environment & Natural Resources Oce, Department of Environment and Natural
Resources (CENRO -DENR), which stated that the subject property was "verified to be within the
Alienable or Disposable land per Land Classification Map No. 3013 established under Project No. 20-A
and approved as such under FAO 4-1656 on March 15, 1982." 7
On 3 December 2002, the RTC rendered judgment in favor of Malabanan, the dispositive portion of which
reads:
WHEREFORE, this Court hereby approves this application for registration and thus places under the
operation of Act 141, Act 496 and/or P.D. 1529, otherwise known as Property Registration Law, the lands
described in Plan Csd-04-0173123-D, Lot 9864-A and containing an area of Seventy One Thousand
Three Hundred Twenty Four (71,324) Square Meters, as supported by its technical description now
forming part of the record of this case, in addition to other proofs adduced in the name of MARIO
MALABANAN, who is of legal age, Filipino, widower, and with residence at Munting Ilog, Silang, Cavite.
HcDaAI
Once this Decision becomes final and executory, the corresponding decree of registration shall forthwith
issue.
SO ORDERED.
The Republic interposed an appeal to the Court of Appeals, arguing that Malabanan had failed to prove
that the property belonged to the alienable and disposable land of the public domain, and that the RTC
had erred in finding that he had been in possession of the property in the manner and for the length of
time required by law for confirmation of imperfect title.
On 23 February 2007, the Court of Appeals rendered a Decision 8 reversing the RTC and dismissing the
application of Malabanan. The appellate court held that under Section 14 (1) of the Property Registration
Decree any period of possession prior to the classification of the lots as alienable and disposable was
inconsequential and should be excluded from the computation of the period of possession. Thus, the
appellate court noted that since the CENRO-DENR certification had verified that the property was
declared alienable and disposable only on 15 March 1982, the Velazcos' possession prior to that date
could not be factored in the computation of the period of possession. This interpretation of the Court of
Appeals of Section 14 (1) of the Property Registration Decree was based on the Court's ruling in Republic
v. Herbieto. 9
Malabanan died while the case was pending with the Court of Appeals; 10 hence, it was his heirs who
appealed the decision of the appellate court. Petitioners, before this Court, rely on our ruling in Republic
v. Naguit, 11 which was handed down just four months prior to Herbieto. Petitioners suggest that the
discussion in Herbieto cited by the Court of Appeals is actually obiter dictum since the Metropolitan Trial
Court therein which had directed the registration of the property had no jurisdiction in the first place since
the requisite notice of hearing was published only after the hearing had already begun. Naguit, petitioners
argue, remains the controlling doctrine, especially when the property in question is agricultural land.
Therefore, with respect to agricultural lands, any possession prior to the declaration of the alienable
property as disposable may be counted in reckoning the period of possession to perfect title under the
Public Land Act and the Property Registration Decree.
The petition was referred to the Court en banc, 12 and on 11 November 2008, the case was heard on
oral arguments. The Court formulated the principal issues for the oral arguments, to wit: HICEca
14! of 105!
1. In order that an alienable and disposable land of the public domain may be registered under
Section 14(1) of Presidential Decree No. 1529, otherwise known as the Property Registration Decree,
should the land be classified as alienable and disposable as of June 12, 1945 or is it sucient that such
classification occur at any time prior to the filing of the applicant for registration provided that it is
established that the applicant has been in open, continuous, exclusive and notorious possession of the
land under a bona fide claim of ownership since June 12, 1945 or earlier?
2. For purposes of Section 14(2) of the Property Registration Decree may a parcel of land
classified as alienable and disposable be deemed private land and therefore susceptible to acquisition
by prescription in accordance with the Civil Code?
3. May a parcel of land established as agricultural in character either because of its use or
because its slope is below that of forest lands be registrable under Section 14(2) of the Property
Registration Decree in relation to the provisions of the Civil Code on acquisitive prescription?
4. Are petitioners entitled to the registration of the subject land in their names under Section 14(1)
or Section 14(2) of the Property Registration Decree or both? 13
Based on these issues, the parties formulated their respective positions.
With respect to Section 14 (1), petitioners reiterate that the analysis of the Court in Naguit is the correct
interpretation of the provision. The seemingly contradictory pronouncement in Herbieto, it is submitted,
should be considered obiter dictum, since the land registration proceedings therein was void ab initio due
to lack of publication of the notice of initial hearing. Petitioners further point out that in Republic v. Bibonia,
14 promulgated in June of 2007, the Court applied Naguit and adopted the same observation that the
preferred interpretation by the OSG of Section 14
(1) was patently absurd. For its part, the OSG remains insistent that for Section 14 (1) to apply, the land
should have been classified as alienable and disposable as of 12 June 1945. Apart from Herbieto, the
OSG also cites the subsequent rulings in Buenaventura v. Republic, 15 Fieldman Agricultural Trading v.
Republic 16 and Republic v. Imperial Credit Corporation, 17 as well as the earlier case of Director of
Lands v. Court of Appeals. 18 ACTEHI
With respect to Section 14 (2), petitioners submit that open, continuous, exclusive and notorious
possession of an alienable land of the public domain for more than 30 years ipso jure converts the land
into private property, thus placing it under the coverage of Section 14 (2). According to them, it would not
matter whether the land sought to be registered was previously classified as agricultural land of the public
domain so long as, at the time of the application, the property had already been "converted" into private
property through prescription. To bolster their argument, petitioners cite extensively from our 2008 ruling
in Republic v. T.A.N. Properties. 19
The arguments submitted by the OSG with respect to Section 14 (2) are more extensive. The OSG notes
that under Article 1113 of the Civil Code, the acquisitive prescription of properties of the State refers to
"patrimonial property", while Section 14 (2) speaks of "private lands". It observes that the Court has yet
to decide a case that presented Section 14 (2) as a ground for application for registration, and that the
30-year possession period refers to the period of possession under Section 48 (b) of the Public Land Act,
and not the concept of prescription under the Civil Code. The OSG further submits that, assuming that
the 30-year prescriptive period can run against public lands, said period should be reckoned from the
time the public land was declared alienable and disposable. Both sides likewise oer special arguments
with respect to the particular factual circumstances surrounding the subject property and the ownership
thereof.
II.
First, we discuss Section 14 (1) of the Property Registration Decree. For a full understanding of the
provision, reference has to be made to the Public Land Act. HSEIAT
A.
Commonwealth Act No. 141, also known as the Public Land Act, has, since its enactment, governed the
classification and disposition of lands of the public domain. The President is authorized, from time to time,
to classify the lands of the public domain into alienable and disposable, timber, or mineral lands. 20
Alienable and disposable lands of the public domain are further classified according to their uses into (a)
agricultural; (b) residential, commercial, industrial, or for similar productive purposes; (c) educational,
charitable, or other similar purposes; or (d) reservations for town sites and for public and quasi-public
uses. 21
May a private person validly seek the registration in his/ her name of alienable and disposable lands of
the public domain? Section 11 of the Public Land Act acknowledges that public lands suitable for
agricultural purposes may be disposed of "by confirmation of imperfect or incomplete titles" through
"judicial
!15 of 105!
legalization". 22 Section 48 (b) of the Public Land Act, as amended by P.D. No. 1073, supplies the details
and unmistakably grants that right, subject to the requisites stated therein:
Sec. 48. The following described citizens of the Philippines, occupying lands of the public domain or
claiming to own any such land or an interest therein, but whose titles have not been perfected or
completed, may apply to the Court of First Instance of the province where the land is located for
confirmation of their claims and the issuance of a certificate of title therefor, under the Land Registration
Act, to wit:
xxx xxx xxx
(b) Those who by themselves or through their predecessors in interest have been in open, continuous,
exclusive, and notorious possession and occupation of alienable and disposable lands of the public
domain, under a bona fide claim of acquisition of ownership, since June 12, 1945, or earlier, immediately
preceding the filing of the application for confirmation of title except when prevented by war or force
majeure. These shall be conclusively presumed to have performed all the conditions essential to a
Government grant and shall be entitled to a certificate of title under the provisions of this chapter. DEHcTI
Section 48 (b) of Com. Act No. 141 received its present wording in 1977 when the law was amended by
P.D. No. 1073. Two significant amendments were introduced by P.D. No. 1073. First, the term
"agricultural lands" was changed to "alienable and disposable lands of the public domain". The OSG
submits that this amendment restricted the scope of the lands that may be registered. 23 This is not
actually the case. Under Section 9 of the Public Land Act, "agricultural lands" are a mere subset of "lands
of the public domain alienable or open to disposition." Evidently, alienable and disposable lands of the
public domain are a larger class than only "agricultural lands.
Second, the length of the requisite possession was changed from possession for "thirty (30) years
immediately preceding the filing of the application" to possession "since June 12, 1945 or earlier". The
Court in Naguit explained:
When the Public Land Act was first promulgated in 1936, the period of possession deemed necessary to
vest the right to register their title to agricultural lands of the public domain commenced from July 26,
1894. However, this period was amended by R.A. No. 1942, which provided that the bona fide claim of
ownership must have been for at least thirty (30) years. Then in 1977, Section 48(b) of the Public Land
Act was again amended, this time by P.D. No. 1073, which pegged the reckoning date at June 12, 1945.
...
It bears further observation that Section 48 (b) of Com. Act No, 141 is virtually the same as Section 14
(1) of the Property Registration Decree. Said Decree codified the various laws relative to the registration
of property, including lands of the public domain. It is Section 14 (1) that operationalizes the registration
of such lands of the public domain. The provision reads:
SEC. 14. Who may apply. The following persons may file in the proper Court of First Instance an
application for registration of title to land, whether personally or through their duly authorized
representatives:
(1) those who by themselves or through their predecessors-in-interest have been in open, continuous,
exclusive and notorious possession and occupation of alienable and disposable lands of the public
domain under a bona fide claim of ownership since June 12, 1945, or earlier. SDTIaE
Notwithstanding the passage of the Property Registration Decree and the inclusion of Section 14 (1)
therein, the Public Land Act has remained in eect. Both laws commonly refer to persons or their
predecessors-in-interest who "have been in open, continuous, exclusive and notorious possession and
occupation of alienable and disposable lands of the public domain under a bona fide claim of ownership
since June 12, 1945, or earlier." That circumstance may have led to the impression that one or the other
is a redundancy, or that Section 48 (b) of the Public Land Act has somehow been repealed or mooted.
That is not the case.
The opening clauses of Section 48 of the Public Land Act and Section 14 of the Property Registration
Decree warrant comparison:
Sec. 48 [of the Public Land Act]. The following described citizens of the Philippines, occupying lands of
the public domain or claiming to own any such land or an interest therein, but whose titles have not been
perfected or completed, may apply to the Court of First Instance of the province where the land is located
for confirmation of their claims and the issuance of a certificate of title therefor, under the Land
Registration Act, to wit:
xxx xxx xxx
Sec. 14 [of the Property Registration Decree]. Who may apply. The following persons may file in the
proper Court of First Instance an application for registration of
!16 of 105!
title to land, whether personally or through their duly authorized representatives:
xxx xxx xxx
It is clear that Section 48 of the Public Land Act is more descriptive of the nature of the right enjoyed by
the possessor than Section 14 of the Property Registration Decree, which seems to presume the pre-
existence of the right, rather than establishing the right itself for the first time. It is proper to assert that it
is the Public Land Act, as amended by P.D. No. 1073 eective 25 January 1977, that has primarily
established the right of a Filipino citizen who has been "in open, continuous, exclusive, and notorious
possession and occupation of alienable and disposable lands of the public domain, under a bona fide
claim of acquisition of ownership, since June 12, 1945" to perfect or complete his title by applying with
the proper court for the confirmation of his ownership claim and the issuance of the corresponding
certificate of title. DCSETa
Section 48 can be viewed in conjunction with the afore-quoted Section 11 of the Public Land Act, which
provides that public lands suitable for agricultural purposes may be disposed of by confirmation of
imperfect or incomplete titles, and given the notion that both provisions declare that it is indeed the Public
Land Act that primarily establishes the substantive ownership of the possessor who has been in
possession of the property since 12 June 1945. In turn, Section 14 (a) of the Property Registration Decree
recognizes the substantive right granted under Section 48 (b) of the Public Land Act, as well provides the
corresponding original registration procedure for the judicial confirmation of an imperfect or incomplete
title. There is another limitation to the right granted under Section 48 (b). Section 47 of the Public Land
Act limits the period within which one may exercise the right to seek registration under Section 48. The
provision has been amended several times, most recently by Rep. Act No. 9176 in 2002. It currently
reads thus:
Section 47. The persons specified in the next following section are hereby granted time, not to extend
beyond December 31, 2020 within which to avail of the benefits of this Chapter: Provided, That this period
shall apply only where the area applied for does not exceed twelve (12) hectares: Provided, further, That
the several periods of time designated by the President in accordance with Section Forty-Five of this Act
shall apply also to the lands comprised in the provisions of this Chapter, but this Section shall not be
construed as prohibiting any said persons from acting under this Chapter at any time prior to the period
fixed by the President. 24
Accordingly under the current state of the law, the substantive right granted under Section 48 (b) may be
availed of only until 31 December 2020.
B.
Despite the clear text of Section 48 (b) of the Public Land Act, as amended and Section 14 (a) of the
Property Registration Decree, the OSG has adopted the position that for one to acquire the right to seek
registration of an alienable and disposable land of the public domain, it is not enough that the applicant
and his/her predecessors-in -interest be in possession under a bona fide claim of ownership since 12
June 1945; the alienable and disposable character of the property must have been declared also as of
12 June 1945. Following the OSG's approach, all lands certified as alienable and disposable after 12
June 1945 cannot be registered either under Section 14 (1) of the Property Registration Decree or Section
48 (b) of the Public Land Act as amended. The absurdity of such an implication was discussed in Naguit.
EcTDCI
Petitioner suggests an interpretation that the alienable and disposable character of the land should have
already been established since June 12, 1945 or earlier. This is not borne out by the plain meaning of
Section 14(1). "Since June 12, 1945", as used in the provision, qualifies its antecedent phrase "under a
bonafide claim of ownership". Generally speaking, qualifying words restrict or modify only the words or
phrases to which they are immediately associated, and not those distantly or remotely located. 25 Ad
proximum antecedents fiat relation nisi impediatur sentencia.
Besides, we are mindful of the absurdity that would result if we adopt petitioner's position. Absent a
legislative amendment, the rule would be, adopting the OSG's view, that all lands of the public domain
which were not declared alienable or disposable before June 12, 1945 would not be susceptible to original
registration, no matter the length of unchallenged possession by the occupant. Such interpretation
renders paragraph (1) of Section 14 virtually inoperative and even precludes the government from giving
it eect even as it decides to reclassify public agricultural l a n d s a s a l i e n a b l e a n d d i s p o s a b
l e . T h e unreasonableness of the situation would even be aggravated considering that before June 12,
1945, the Philippines was not yet even considered an independent state.
Accordingly, the Court in Naguit explained:
[T]he more reasonable interpretation of Section 14(1) is that it merely requires the property sought to be
registered as already alienable and disposable at the time the application for registration of title is filed.
If the State, at the time the application is made, has not yet
!17 of 105!
deemed it proper to release the property for alienation or disposition, the presumption is that the
government is still reserving the right to utilize the property; hence, the need to preserve its ownership in
the State irrespective of the length of adverse possession even if in good faith. However, if the property
has already been classified as alienable and disposable, as it is in this case, then there is already an
intention on the part of the State to abdicate its exclusive prerogative over the property. EIcSTD
The Court declares that the correct interpretation of Section 14 (1) is that which was adopted in Naguit.
The contrary pronouncement in Herbieto, as pointed out in Naguit, absurdly limits the application of the
provision to the point of virtual inutility since it would only cover lands actually declared alienable and
disposable prior to 12 June 1945, even if the current possessor is able to establish open, continuous,
exclusive and notorious possession under a bona fide claim of ownership long before that date.
Moreover, the Naguit interpretation allows more possessors under a bona fide claim of ownership to avail
of judicial confirmation of their imperfect titles than what would be feasible under Herbieto. This balancing
fact is significant, especially considering our forthcoming discussion on the scope and reach of Section
14 (2) of the Property Registration Decree.
Petitioners make the salient observation that the contradictory passages from Herbieto are obiter dicta
since the land registration proceedings therein is void ab initio in the first place due to lack of the requisite
publication of the notice of initial hearing. There is no need to explicitly overturn Herbieto, as it suces
that the Court's acknowledgment that the particular line of argument used therein concerning Section 14
(1) is indeed obiter.
It may be noted that in the subsequent case of Buenaventura, 26 the Court, citing Herbieto, again stated
that "[a]ny period of possession prior to the date when the [s]ubject [property was] classified as alienable
and disposable is inconsequential and should be excluded from the computation of the period of
possession. . ." That statement, in the context of Section 14 (1), is certainly erroneous. Nonetheless, the
passage as cited in Buenaventura should again be considered as obiter. The application therein was
ultimately granted, citing Section 14 (2). The evidence submitted by petitioners therein did not establish
any mode of possession on their part prior to 1948, thereby precluding the application of Section 14 (1).
It is not even apparent from the decision whether petitioners therein had claimed entitlement to original
registration following Section 14 (1), their position being that they had been in exclusive possession under
a bona fide
For August 18, 2017 claim of ownership for over fifty (50) years, but not before 12 June 1945. aCHDST
Thus, neither Herbieto nor its principal discipular ruling Buenaventura has any precedental value with
respect to Section 14 (1). On the other hand, the ratio of Naguit is embedded in Section 14 (1), since it
precisely involved situation wherein the applicant had been in exclusive possession under a bona fide
claim of ownership prior to 12 June 1945. The Court's interpretation of Section 14 (1) therein was decisive
to the resolution of the case. Any doubt as to which between Naguit or Herbieto provides the final word
of the Court on Section 14 (1) is now settled in favor of Naguit.
We noted in Naguit that it should be distinguished from Bracewell v. Court of Appeals 27 since in the
latter, the application for registration had been filed before the land was declared alienable or disposable.
The dissent though pronounces Bracewell as the better rule between the two. Yet two years after
Bracewell, its ponente, the esteemed Justice Consuelo Ynares-Santiago, penned the ruling in Republic
v. Ceniza, 28 which involved a claim of possession that extended back to 1927 over a public domain land
that was declared alienable and disposable only in 1980. Ceniza cited Bracewell, quoted extensively from
it, and following the mindset of the dissent, the attempt at registration in Ceniza should have failed. Not
so.
To prove that the land subject of an application for registration is alienable, an applicant must establish
the existence of a positive act of the government such as a presidential proclamation or an executive
order; an administrative action; investigation reports of Bureau of Lands investigators; and a legislative
act or a statute.
In this case, private respondents presented a certification dated November 25, 1994, issued by Eduardo
M. Inting, the Community Environment and Natural Resources Ocer in the Department of Environment
and Natural Resources Oce in Cebu City, stating that the lots involved were "found to be within the
alienable and disposable (sic) Block-I, Land Classification Project No. 32-A, per map 2962 4-I555 dated
December 9, 1980". This is sucient evidence to show the real character of the land subject of private
respondents' application. Further, the certification enjoys a presumption of regularity in the absence of
contradictory evidence, which is true in this case. Worth noting also was the observation of the Court of
Appeals stating that:
[n]o opposition was filed by the Bureaus of Lands and Forestry to contest the application of appellees on
the ground that the property still forms part of the public
!18 of 105!
domain. Nor is there any showing that the lots in question are forestal land. . . .
Thus, while the Court of Appeals erred in ruling that mere possession of public land for the period required
by law would entitle its occupant to a confirmation of imperfect title, it did not err in ruling in favor of private
respondents as far as the first requirement in Section 48(b) of the Public Land Act is concerned, for they
were able to overcome the burden of proving the alienability of the land subject of their application.
As correctly found by the Court of Appeals, private respondents were able to prove their open,
continuous, exclusive and notorious possession of the subject land even before the year 1927. As a rule,
we are bound by the factual findings of the Court of Appeals. Although there are exceptions, petitioner
did not show that this is one of them. 29
Why did the Court in Ceniza, through the same eminent member who authored Bracewell, sanction the
registration under Section 48 (b) of public domain lands declared alienable or disposable thirty-five (35)
years and 180 days after 12 June 1945? The telling dierence is that in Ceniza, the application for
registration was filed nearly six (6) years after the land had been declared alienable or disposable, while
in Bracewell, the application was filed nine (9) years before the land was declared alienable or disposable.
That crucial d ie re n c e w a s a l s o s t re s s e d i n N a g u i t t o contradistinguish it from Bracewell,
a dierence which the dissent seeks to belittle.
III.
We next ascertain the correct framework of analysis with respect to Section 14 (2). The provision reads:
SEC. 14. Who may apply. The following persons may file in the proper Court of First Instance an
application for registration of title to land, whether personally or through their duly authorized
representatives:
xxx xxx xxx
(2) Those who have acquired ownership over private lands by prescription under the provisions of existing
laws.
The Court in Naguit oered the following discussion concerning Section 14 (2), which we did even then
recognize, and still do, to be an obiter dictum, but we nonetheless refer to it as material for further
discussion, thus:
Did the enactment of the Property Registration Decree and the amendatory P.D. No. 1073 preclude the
application for registration of alienable lands of the
For August 18, 2017 public domain, possession over which commenced only after June 12, 1945? It did
not, considering Section 14(2) of the Property Registration Decree, which governs and authorizes the
application of "those who have acquired ownership of private lands by prescription under the provisions
of existing laws."
Prescription is one of the modes of acquiring ownership under the Civil Code. [ 30 ] There is a consistent
jurisprudential rule that properties classified as alienable public land may be converted into private
property by reason of open, continuous and exclusive possession of at least thirty (30) years. [ 31 ] With
such conversion, such property may now fall within the contemplation of "private lands" under Section
14(2), and thus susceptible to registration by those who have acquired ownership through prescription.
Thus, even if possession of the alienable public land commenced on a date later than June 12, 1945,
and such possession being been open, continuous and exclusive, then the possessor may have the right
to register the land by virtue of Section 14(2) of the Property Registration Decree.
Naguit did not involve the application of Section 14 (2), unlike in this case where petitioners have based
their registration bid primarily on that provision, and where the evidence definitively establishes their claim
of possession only as far back as 1948. It is in this case that we can properly appreciate the nuances of
the provision.
A.
The obiter in Naguit cited the Civil Code provisions on prescription as the possible basis for application
for original registration under Section 14 (2). Specifically, it is Article 1113 which provides legal foundation
for the application. It reads:
All things which are within the commerce of men are susceptible of prescription, unless otherwise
provided. Property of the State or any of its subdivisions not patrimonial in character shall not be the
object of prescription.
It is clear under the Civil Code that where lands of the public domain are patrimonial in character, they
are susceptible to acquisitive prescription. On the other hand, among the public domain lands that are
not susceptible to acquisitive prescription are timber lands and mineral lands. The Constitution itself
proscribes private ownership of timber or mineral lands.
There are in fact several provisions in the Civil Code concerning the acquisition of real property through
prescription. Ownership of real property may be acquired by ordinary prescription of ten (10) years, 32
!19 of 105!
or through extraordinary prescription of thirty (30) years. 33 Ordinary acquisitive prescription requires
possession in good faith, 34 as well as just title.
When Section 14 (2) of the Property Registration Decree explicitly provides that persons "who have
acquired ownership over private lands by prescription under the provisions of existing laws", it
unmistakably refers to the Civil Code as a valid basis for the registration of lands. The Civil Code is the
only existing law that specifically allows the acquisition by prescription of private lands, including
patrimonial property belonging to the State. Thus, the critical question that needs armation is whether
Section 14
(2) does encompass original registration proceedings over patrimonial property of the State, which a
private person has acquired through prescription.
The Naguit obiter had adverted to a frequently reiterated jurisprudence holding that properties classified
as alienable public land may be converted into private property by reason of open, continuous and
exclusive possession of at least thirty (30) years. 36 Yet if we ascertain the source of the "thirty-year"
period, additional complexities relating to Section 14 (2) and to how exactly it operates would emerge.
For there are in fact two distinct origins of the thirty (30)-year rule.
The first source is Rep. Act No. 1942, enacted in 1957, which amended Section 48 (b) of the Public Land
Act by granting the right to seek original registration of alienable public lands through possession in the
concept of an owner for at least thirty years.
The following-described citizens of the Philippines, occupying lands of the public domain or claiming to
own any such lands or an interest therein, but whose titles have not been perfected or completed, may
apply to the Court of First Instance of the province where the land is located for confirmation of their
claims and the issuance of a certificate of title therefor, under the Land Registration Act, to wit:
xxx xxx xxx
(b) Those who by themselves or through their predecessors in interest have been in open, continuous,
exclusive and notorious possession and occupation of agricultural lands of the public domain, under a
bona fide claim of acquisition of ownership, for at least thirty years immediately preceding the filing of the
application for confirmation of title, except when prevented by war or force majeure. These shall be
conclusively presumed to have performed all the conditions essential to a Government grant and shall
be entitled to a certificate of title under the provisions of this Chapter. (emphasis supplied) 37
For August 18, 2017
This provision was repealed in 1977 with the enactment of P.D. 1073, which made the date 12 June 1945
the reckoning point for the first time. Nonetheless, applications for registration filed prior to 1977 could
have invoked the 30-year rule introduced by Rep. Act No. 1942.
The second source is Section 14 (2) of P.D. 1529 itself, at least by implication, as it applies the rules on
prescription under the Civil Code, particularly Article 1113 in relation to Article 1137. Note that there are
two kinds of prescription under the Civil Code ordinary acquisitive prescription and extraordinary
acquisitive prescription, which, under Article 1137, is completed "through uninterrupted adverse
possession. . . for thirty years, without need of title or of good faith.
Obviously, the first source of the thirty (30)-year period rule, Rep. Act No. 1942, became unavailable after
1977. At present, the only legal basis for the thirty (30)-year period is the law on prescription under the
Civil Code, as mandated under Section 14 (2). However, there is a material dierence between how the
thirty (30)-year rule operated under Rep. Act No. 1942 and how it did under the Civil Code.
Section 48 (b) of the Public Land Act, as amended by Rep. Act No. 1942, did not refer to or call into
application the Civil Code provisions on prescription. It merely set forth a requisite thirty-year possession
period immediately preceding the application for confirmation of title, without any qualification as to
whether the property should be declared alienable at the beginning of, and continue as such, throughout
the entire thirty (30) years. There is neither statutory nor jurisprudential basis to assert Rep. Act No. 1942
had mandated such a requirement, 38 similar to our earlier finding with respect to the present language
of Section 48 (b), which now sets 12 June 1945 as the point of reference.
Then, with the repeal of Rep. Act No. 1942, the thirty-year possession period as basis for original
registration became Section 14 (2) of the Property Registration Decree, which entitled those "who have
acquired ownership over private lands by prescription under the provisions of existing laws" to apply for
original registration. Again, the thirty-year period is derived from the rule on extraordinary prescription
under Article 1137 of the Civil Code. At the same time, Section 14 (2) puts into operation the entire regime
of prescription under the Civil Code, a fact which does not hold true with respect to Section 14 (1).
B.
Unlike Section 14 (1), Section 14 (2) explicitly refers to the principles on prescription under existing laws.
20! of 105!
Accordingly, we are impelled to apply the civil law concept of prescription, as set forth in the Civil Code,
in our interpretation of Section 14 (2). There is no similar demand on our part in the case of Section 14
(1).
The critical qualification under Article 1113 of the Civil Code is thus: "[p]roperty of the State or any of its
subdivisions not patrimonial in character shall not be the object of prescription". The identification what
consists of patrimonial property is provided by Articles 420 and 421, which we quote in full:
Art. 420. The following things are property of public dominion:
(1) Those intended for public use, such as roads, canals, rivers, torrents, ports and bridges
constructed by the State, banks, shores, roadsteads, and others of similar character;
(2) Those which belong to the State, without being for public use, and are intended for some public
service or for the development of the national wealth.
Art. 421. All other property of the State, which is not of the character stated in the preceding article, is
patrimonial property.
It is clear that property of public dominion, which generally includes property belonging to the State,
cannot be the object of prescription or, indeed, be subject of the commerce of man. 39 Lands of the public
domain, whether declared alienable and disposable or not, are property of public dominion and thus
insusceptible to acquisition by prescription.
Let us now explore the eects under the Civil Code of a declaration by the President or any duly
authorized government ocer of alienability and disposability of lands of the public domain. Would such
lands so declared alienable and disposable be converted, under the Civil Code, from property of the
public dominion into patrimonial property? After all, by connotative definition, alienable and disposable
lands may be the object of the commerce of man; Article 1113 provides that all things within the
commerce of man are susceptible to prescription; and the same provision further provides that patrimonial
property of the State may be acquired by prescription. IEcDCa
Nonetheless, Article 422 of the Civil Code states that "[p]roperty of public dominion, when no longer
intended for public use or for public service, shall form part of the patrimonial property of the State". It is
this provision that controls how public dominion property may be converted into patrimonial property
susceptible
For August 18, 2017 to acquisition by prescription. After all, Article 420 (2) makes clear that those property
"which belong to the State, without being for public use, and are intended for some public service or for
the development of the national wealth" are public dominion property. For as long as the property belongs
to the State, although already classified as alienable or disposable, it remains property of the public
dominion if when * it is "intended for some public service or for the development of the national wealth.
Accordingly, there must be an express declaration by the State that the public dominion property is no
longer intended for public service or the development of the national wealth or that the property has been
converted into patrimonial. Without such express declaration, the property, even if classified as alienable
or disposable, remains property of the public dominion, pursuant to Article 420 (2), and thus incapable of
acquisition by prescription. It is only when such alienable and disposable lands are expressly declared
by the State to be no longer intended for public service or for the development of the national wealth that
the period of acquisitive prescription can begin to run. Such declaration shall be in the form of a law duly
enacted by Congress or a Presidential Proclamation in cases where the President is duly authorized by
law.
It is comprehensible with ease that this reading of Section 14 (2) of the Property Registration Decree
limits its scope and reach and thus aects the registrability even of lands already declared alienable and
disposable to the detriment of the bona fide possessors or occupants claiming title to the lands. Yet this
interpretation is in accord with the Regalian doctrine and its concomitant assumption that all lands owned
by the State, although declared alienable or disposable, remain as such and ought to be used only by
the Government.
Recourse does not lie with this Court in the matter. The duty of the Court is to apply the Constitution and
the laws in accordance with their language and intent. The remedy is to change the law, which is the
province of the legislative branch. Congress can very well be entreated to amend Section 14 (2) of the
Property Registration Decree and pertinent provisions of the Civil Code to liberalize the requirements for
judicial confirmation of imperfect or incomplete titles. aATEDS The operation of the foregoing
interpretation can be illustrated by an actual example. Republic Act No. 7227, entitled "An Act
Accelerating The Conversion Of Military Reservations Into Other Productive Uses, etc.", is more
commonly known as the BCDA law. Section 2 of the law authorizes the sale of certain military
reservations and portions of military camps in Metro Manila, including Fort Bonifacio and Villamor Air
Base.
!21 of 105!
For purposes of eecting the sale of the military camps, the law mandates the President to transfer such
military lands to the Bases Conversion Development Authority (BCDA) 40 which in turn is authorized to
own, hold and/or administer them. 41 The President is authorized to sell portions of the military camps,
in whole or in part. 42 Accordingly, the BCDA law itself declares that the military lands subject thereof
are "alienable and disposable pursuant to the provisions of existing laws and regulations governing sales
of government properties." 43
From the moment the BCDA law was enacted the subject military lands have become alienable and
disposable. However, said lands did not become patrimonial, as the BCDA law itself expressly makes
the reservation that these lands are to be sold in order to raise funds for the conversion of the former
American bases at Clark and Subic. 44 Such purpose can be tied to either "public service" or "the
development of national wealth" under Article 420 (2). Thus, at that time, the lands remained property of
the public dominion under Article 420 (2), notwithstanding their status as alienable and disposable. It is
upon their sale as authorized under the BCDA law to a private person or entity that such lands become
private property and cease to be property of the public dominion.
C.
Should public domain lands become patrimonial because they are declared as such in a duly enacted
law or duly promulgated proclamation that they are no longer intended for public service or for the
development of the national wealth, would the period of possession prior to the conversion of such public
dominion into patrimonial be reckoned in counting the prescriptive period in favor of the possessors? We
rule in the negative.
The limitation imposed by Article 1113 dissuades us from ruling that the period of possession before the
public domain land becomes patrimonial may be counted for the purpose of completing the prescriptive
period. Possession of public dominion property before it becomes patrimonial cannot be the object of
prescription according to the Civil Code. As the application for registration under Section 14 (2) falls
wholly within the framework of prescription under the Civil Code, there is no way that possession during
the time that the land was still classified as public dominion property can be counted to meet the requisites
of acquisitive prescription and justify registration.
Are we being inconsistent in applying divergent rules for Section 14 (1) and Section 14 (2)? There is no
inconsistency. Section 14 (1) mandates registration on the basis of possession, while Section 14 (2)
entitles
For August 18, 2017 registration on the basis of prescription. Registration under Section 14 (1) is
extended under the aegis of the Property Registration Decree and the Public Land Act while registration
under Section 14 (2) is made available both by the Property Registration Decree and the Civil Code.
In the same manner, we can distinguish between the thirty-year period under Section 48 (b) of the Public
Land Act, as amended by Rep. Act No. 1472, and the thirty-year period available through Section 14 (2)
of the Property Registration Decree in relation to Article 1137 of the Civil Code. The period under the
former speaks of a thirty-year period of possession, while the period under the latter concerns a thirty-
year period of extraordinary prescription. Registration under Section 48 (b) of the Public Land Act as
amended by Rep. Act No. 1472 is based on thirty years of possession alone without regard to the Civil
Code, while the registration under Section 14 (2) of the Property Registration Decree is founded on
extraordinary prescription under the Civil Code.
It may be asked why the principles of prescription under the Civil Code should not apply as well to Section
14 (1). Notwithstanding the vaunted status of the Civil Code, it ultimately is just one of numerous statutes,
neither superior nor inferior to other statutes such as the Property Registration Decree. The legislative
branch is not bound to adhere to the framework set forth by the Civil Code when it enacts subsequent
legislation. Section 14 (2) manifests a clear intent to interrelate the registration allowed under that
provision with the Civil Code, but no such intent exists with respect to Section 14 (1).
IV.
One of the keys to understanding the framework we set forth today is seeing how our land registration
procedures correlate with our law on prescription, which, under the Civil Code, is one of the modes for
acquiring ownership over property.
The Civil Code makes it clear that patrimonial property of the State may be acquired by private persons
through prescription. This is brought about by Article 1113, which states that "[a]ll things which are within
the commerce of man are susceptible to prescription", and that [p]roperty of the State or any of its
subdivisions not patrimonial in character shall not be the object of prescription.
There are two modes of prescription through which immovables may be acquired under the Civil Code.
The first is ordinary acquisitive prescription, which, under Article 1117, requires possession in good faith
and with just title; and, under Article 1134, is completed through
!22 of 105!
possession of ten (10) years. There is nothing in the Civil Code that bars a person from acquiring
patrimonial property of the State through ordinary acquisitive prescription, nor is there any apparent
reason to impose such a rule. At the same time, there are indispensable requisites good faith and just
title. The ascertainment of good faith involves the application of Articles 526, 527, and 528, as well as
Article 1127 of the Civil Code, 45 provisions that more or less speak for themselves.
On the other hand, the concept of just title requires some clarification. Under Article 1129, there is just
title for the purposes of prescription "when the adverse claimant came into possession of the property
through one of the modes recognized by law for the acquisition of ownership or other real rights, but the
grantor was not the owner or could not transmit any right". Dr. Tolentino explains:
Just title is an act which has for its purpose the transmission of ownership, and which would have actually
transferred ownership if the grantor had been the owner. This vice or defect is the one cured by
prescription. Examples: sale with delivery, exchange, donation, succession, and dacion in payment. 46
The OSG submits that the requirement of just title necessarily precludes the applicability of ordinary
acquisitive prescription to patrimonial property. The major premise for the argument is that "the State, as
the owner and grantor, could not transmit ownership to the possessor before the completion of the
required period of possession". 47 It is evident that the OSG erred when it assumed that the grantor
referred to in Article 1129 is the State. The grantor is the one from whom the person invoking ordinary
acquisitive prescription derived the title, whether by sale, exchange, donation, succession or any other
mode of the acquisition of ownership or other real rights. SIEHcA
Earlier, we made it clear that, whether under ordinary prescription or extraordinary prescription, the period
of possession preceding the classification of public dominion lands as patrimonial cannot be counted for
the purpose of computing prescription. But after the property has been become patrimonial, the period of
prescription begins to run in favor of the possessor. Once the requisite period has been completed, two
legal events ensue: (1) the patrimonial property is ipso jure converted into private land; and (2) the person
in possession for the periods prescribed under the Civil Code acquires ownership of the property by
operation of the Civil Code.
For August 18, 2017
It is evident that once the possessor automatically becomes the owner of the converted patrimonial
property, the ideal next step is the registration of the property under the Torrens system. It should be
remembered that registration of property is not a mode of acquisition of ownership, but merely a mode of
confirmation of ownership. 48
Looking back at the registration regime prior to the adoption of the Property Registration Decree in 1977,
it is apparent that the registration system then did not fully accommodate the acquisition of ownership of
patrimonial property under the Civil Code. What the system accommodated was the confirmation of
imperfect title brought about by the completion of a period of possession ordained under the Public Land
Act (either 30 years following Rep. Act No. 1942, or since 12 June 1945 following P.D. No. 1073).
The Land Registration Act 49 was noticeably silent on the requisites for alienable public lands acquired
through ordinary prescription under the Civil Code, though it arguably did not preclude such registration.
50 Still, the gap was lamentable, considering that the Civil Code, by itself, establishes ownership over
the patrimonial property of persons who have completed the prescriptive periods ordained therein. The
gap was finally closed with the adoption of the Property Registration Decree in 1977, with Section 14 (2)
thereof expressly authorizing original registration in favor of persons who have acquired ownership over
private lands by prescription under the provisions of existing laws, that is, the Civil Code as of now.
V.
We synthesize the doctrines laid down in this case, as follows:
(1) In connection with Section 14 (1) of the Property Registration Decree, Section 48 (b) of the Public
Land Act recognizes and confirms that "those who by themselves or through their predecessors in interest
have been in open, continuous, exclusive, and notorious possession and occupation of alienable and
disposable lands of the public domain, under a bona fide claim of acquisition of ownership, since June
12, 1945" have acquired ownership of, and registrable title to, such lands based on the length and quality
of their possession.
(a) Since Section 48 (b) merely requires possession since 12 June 1945 and does not require that the
lands should have been alienable and disposable during the entire period of possession, the possessor
is entitled to secure judicial confirmation of his title thereto as soon as it is declared alienable and
disposable, subject to
!23 of 105!
the timeframe imposed by Section 47 of the Public Land Act. 51
(b) The right to register granted under Section 48 (b) of the Public Land Act is further confirmed by Section
14
(1) of the Property Registration Decree.
(2) In complying with Section 14 (2) of the Property Registration Decree, consider that under the
Civil Code, prescription is recognized as a mode of acquiring ownership of patrimonial property. However,
public domain lands become only patrimonial property not only with a declaration that these are alienable
or disposable. There must also be an express government manifestation that the property is already
patrimonial or no longer retained for public service or the development of national wealth, under Article
422 of the Civil Code. And only when the property has become patrimonial can the prescriptive period
for the acquisition of property of the public dominion begin to run.

(a) Patrimonial property is private property of the government. The person acquires ownership of
patrimonial property by prescription under the Civil Code is entitled to secure registration thereof under
Section 14 (2) of the Property Registration Decree.
(b) There are two kinds of prescription by which patrimonial property may be acquired, one
ordinary and other extraordinary. Under ordinary acquisitive prescription, a person acquires ownership
of a patrimonial property through possession for at least ten (10) years, in good faith and with just title.
Under extraordinary acquisitive prescription, a person's uninterrupted adverse possession of patrimonial
property for at least thirty (30) years, regardless of good faith or just title, ripens into ownership.
B.
We now apply the above-stated doctrines to the case at bar.
new phase of land reform to sensibly regularize and formalize the settlement of such lands which in legal
theory are lands of the public domain before the problem becomes insoluble. This
!24 of 105!
could be accomplished, to cite two examples, by liberalizing the standards for judicial confirmation of
imperfect title, or amending the Civil Code itself to ease the requisites for the conversion of public
dominion property into patrimonial.
One's sense of security over land rights infuses into every aspect of well-being not only of that individual,
but also to the person's family. Once that sense of security is deprived, life and livelihood are put on
stasis. It is for the political branches to bring welcome closure to the long pestering problem.
WHEREFORE, the Petition is DENIED. The Decision of the Court of Appeals dated 23 February 2007
and Resolution dated 2 October 2007 are AFFIRMED. No pronouncement as to costs.

It is clear that the evidence of petitioners is insucient to establish that Malabanan has acquired SO ORDERED.
ownership over the subject property under Section 48 (b) of the Public Land Act. There is no substantive
evidence to establish that Malabanan or petitioners as his predecessors-in-interest have been in
possession of the property since 12 June 1945 or earlier. The earliest that petitioners can date back their
possession, according to their own evidence the Tax Declarations they presented in particular is to
the year 1948. Thus, they cannot avail themselves of registration under Section 14 (1) of the Property
Registration Decree. EaCDAT

For August 18, 2017

Neither can petitioners properly invoke Section 14 (2) as basis for registration. While the subject property
was declared as alienable or disposable in 1982, there is no competent evidence that is no longer
intended for public use service or for the development of the national evidence, conformably with Article
422 of the Civil Code. The classification of the subject property as alienable and disposable land of the
public domain does not change its status as property of the public dominion under Article 420 (2) of the
Civil Code. Thus, it is insusceptible to acquisition by prescription.

VI.

A final word. The Court is comfortable with the correctness of the legal doctrines established in this
decision. Nonetheless, discomfiture over the implications of today's ruling cannot be discounted. For,
every untitled property that is occupied in the country will be aected by this ruling. The social implications
cannot be dismissed lightly, and the Court would be abdicating its social responsibility to the Filipino
people if we simply levied the law without comment.

The informal settlement of public lands, whether declared alienable or not, is a phenomenon tied to long-
standing habit and cultural acquiescence, and is common among the so-called "Third World" countries.
This paradigm powerfully evokes the disconnect between a legal system and the reality on the ground.
The law so far has been unable to bridge that gap. Alternative means of acquisition of these public domain
lands, such as through homestead or free patent, have proven unattractive due to limitations imposed on
the grantee in the encumbrance or alienation of said properties. 52 Judicial confirmation of imperfect title
has emerged as the most viable, if not the most attractive means to regularize the informal settlement of
alienable or disposable lands of the public domain, yet even that system, as revealed in this decision,
has considerable limits.

There are millions upon millions of Filipinos who have individually or exclusively held residential lands on
which they have lived and raised their families. Many more have tilled and made productive idle lands of
the State with their hands. They have been regarded for generation by their families and their
communities as common law owners. There is much to be said about the virtues of according them
legitimate states. Yet such virtues are not for the Court to translate into positive law, as the law itself
considered such lands as property of the public dominion. It could only be up to Congress to set forth a
SECOND DIVISION
[G.R. No. 109595. April 27, 2000.] CRISTETA CHUA-BURCE, petitioner, vs. COURT OF
APPEALS AND PEOPLE OF THE PHILIPPINES, respondents.
D E C I S I O N QUISUMBING, J p:
Subject of the present appeal by certiorari is the decision dated November 27, 1992 of the Court of
Appeals in CA-G.R. CR No. 12037, (a) arming in toto the trial court's decision finding petitioner guilty
of estafa, and (b) denying her Motion for Reconsideration in a Resolution dated March 25, 1993. The
Regional Trial Court, Calapan, Oriental Mindoro, Branch 40, rendered a joint decision finding petitioner
guilty of estafa under Article 315, par. 1 (b) of the Revised Penal Code, in Criminal Case No. C-2313,
and likewise found petitioner liable for the amount of P150,000.00 in Civil Case No. R-3733. Only the
criminal case is before us for review.
The uncontroverted facts, as found by the Court of Appeals, are as follows:
On August 16, 1985, Ramon Rocamora, the Manager (of Metropolitan Bank and Trust Company,
Calapan Branch, Oriental Mindoro) requested Fructuoso Peaflor, Assistant Cashier, to conduct a
physical bundle count of the cash inside the vault, which should total P4,000,000.00, more or less. During
this initial cash count, they discovered a shortage of fifteen bundles of One Hundred Pesos denominated
bills totalling P150,000.00. The One Hundred Peso bills actually counted was P3,850,000.00 as against
the balance of P4,000,000.00 in the Cash in Vault (CIV)
For August 18, 2017
Summary Sheet, or a total shortage of P150,000.00. The next day, to determine if there was actually a
shortage, a re-verification of the records and documents of the transactions in the bank was conducted.
There was still a shortage of P150,000.00.
The bank initiated investigations totalling four (4) in all. The first was by Ramon Rocamora, the Manager.
The second was by the bank's internal auditors headed by Antonio Batungbakal. Then, the bank's
Department of I n t e r n a l Aa i r s c o n d u c t e d a n i n d e p e n d e n t investigation. Thereafter, the
National Bureau of Investigation (NBI) came in to investigate. All of these investigations concluded that
there was a shortage of P150,000.00, and the person primarily responsible was the bank's Cash
Custodian, Cristeta Chua-Burce, the herein accused.
On November 4, 1985, unable to satisfactorily explain the shortage of P150,000.00, the accused's service
with the bank was terminated.
To recover the missing amount, Metropolitan Bank and Trust Company (Metrobank) filed a Civil Case for
Sum of Money and Damages with Preliminary Attachment and Garnishment docketed as Civil Case No.
R-3733 against petitioner and her husband, Antonio Burce.
Prior to the filing of the Answer, the following Information for Estafa was filed against petitioner:
"That on or about the 16th day of August 1985, and for a period prior and subsequent thereto, the above-
named accused, with unfaithfulness or abuse of confidence, and with intent to defraud, did then and there
wilfully, unlawfully, and feloniously, in her capacity as Cash Custodian of the Metrobank, Calapan Branch,
take from the Bank's Vault the amount of ONE HUNDRED FIFTY THOUSAND (P150,000.00) PESOS,
which is under her direct custody and/or accountability, misappropriate and convert to her own personal
use and benefit, without the knowledge and consent of the oended party, despite repeated demands for
her to account and/or return the said amount, she refused and failed, and still fails and refuses to the
damage and prejudice of the Metrobank, Calapan Branch, in the aforementioned amount of ONE
HUNDRED FIFTY THOUSAND (P150,000.00) PESOS.
Contrary to Article 315 of the Revised Penal Code. Calapan, Oriental Mindoro, November 27, 1985." 1
Both civil and criminal cases were raed to the same branch of the Regional Trial Court of Calapan,
Oriental Mindoro, Branch 40.
Thereafter, petitioner moved for the suspension of the criminal case on the ground of the existence of a
!25 of 105!
prejudicial question, viz., that the resolution of the civil case was determinative of her guilt or innocence
in the criminal case. 2 The trial court, over the vehement opposition of the private and public prosecutors,
granted the motion and suspended the trial of the criminal case. 3 On petition for certiorari to the Court
of Appeals, the appellate court ruled that there was no prejudicial question. 4
Petitioner was arraigned and assisted by counsel de parte, entered a plea of not guilty. 5 While the trial
of the criminal case was suspended, the trial of the civil case continued. At the time of arraignment, the
civil case was already submitted for decision. Hence, during the pre-trial conference of the criminal case,
the parties agreed to adopt their respective evidence in the civil case as their respective evidence in the
criminal case. 6 The trial court ordered the parties to submit their written agreement pursuant to Section
4 of Rule 118 of the Rules of Court. 7 Thereafter, petitioner, duly assisted by her counsel, with the
conforme of the public prosecutor, entered into the following pre-trial agreement: 8
"COMES NOW, the accused, assisted by counsel, and unto this Honorable Court most respectfully
submits this Pre-Trial agreement:
1. That the evidence already adduced by the plainti in Civil Case No. R-3733 will be adopted by
the prosecution as its evidence in Criminal Case No. C-2313;
2. That the evidence to be adduced by the defendant in Civil Case No. R-3733 will also be
adopted as evidence for the defense in Criminal Case No. C-2313.
WHEREFORE, premises considered, it is prayed that the foregoing pre- trial agreement be admitted in
compliance with the Order of this Court dated April 19, 1988.
RESPECTFULLY SUBMITTED.
Calapan, Oriental Mindoro, August 20, 1990.
CRISTETA CHUA-BURCE (sgd.)
Accused
Assisted By:
RODRIGO C. DIMAYACYAC (sgd.)
Defense Counsel
San Vicente, Calapan
Oriental Mindoro
IBP O.R. No. 292575
May 11, 1990
Quezon City
With Conformity:
EMMANUEL S. PANALIGAN (sgd.)
Prosecuting Fiscal
For August 18, 2017
Pursuant to the pre-trial agreement, the public prosecutor filed a Motion to Adopt Evidence. 9 Both the
pre-trial agreement and said Motion were granted by the trial court. 10
On March 18, 1991, the trial court rendered a consolidated decision 11 finding petitioner (a) guilty of
estafa under Article 315 (1) (b) of the Revised Penal Code in the criminal case, and (b) liable for the
amount of P150,000.00 in the civil case. The dispositive portion of decision provides
In Criminal Case No. C-2313
WHEREFORE, the Court hereby finds the accused Cristeta Chua-Burce guilty beyond reasonable doubt
of the crime of Estafa, punishable under Art. 315, paragraph 1 (b) of the Revised Penal Code, which
imposes a penalty of prision correccional in its maximum period to prision mayor in its minimum period
but considering that the amount involved exceeds P22,000.00, the penalty provided for shall be imposed
in its maximum period, adding one year for each additional P10,000.00, but the total amount not to exceed
twenty years.
Applying the Indeterminate Sentence Law, the imposable penalty shall be one degree lower as minimum
of arresto mayor with a penalty range of One Month and One Day to Six Months, as minimum to prision
mayor in its maximum period, as maximum, or a penalty of Six years to Twelve Years. Considering the
mitigating circumstance of voluntary surrender, the court hereby imposes upon the accused to suer
imprisonment from SIX (6) MONTHS of arresto mayor in its maximum period, as minimum, to EIGHT (8)
YEARS of prision mayor, in its minimum period, as maximum. The civil liability shall not be imposed in
this case due to a separate civil action.
In Civil Case No. R-3733
WHEREFORE, judgment is hereby rendered in favor of the plainti Metrobank, ordering defendants
Cristeta Chua-Burce and Antonio Burce, spouses, to pay Metrobank the amount of P150,000.00
representing the amount misappropriated with the legal rate of six percent (6%) per annum from August
15, 1985 until fully paid and to pay the costs of suit.
SO ORDERED.
Petitioner seasonably appealed her conviction in the criminal case to the Court of Appeals. Petitioner
filed a separate appeal in the civil case.
!26 of 105!
In a decision dated November 27, 1992, 12 the Court of Appeals armed the trial court's decision in toto.
Petitioner's Motion for Reconsideration was likewise denied. 13 Hence, the recourse to this Court.
Petitioner raises the following issues: 14
1. IS THE RESULT OF POLYGRAPH EXAMINATION ADMISSIBLE IN EVIDENCE?
2. CAN THE PRESIDING JUDGE OF THE REGIONAL TRIAL COURT ADMIT IN EVIDENCE
THE EVIDENCE WHICH WAS ALREADY DENIED ADMISSION IN THE ORDER OF THE FORMER
JUDGE OF THE SAME COURT?
3 . D O E S P R I M A FA C I E P R E S U M P T I O N O F MISAPPROPRIATION OR CONVERSION
EXISTS (sic) AGAINST THE PETITIONER WHEN THERE WERE OTHER PERSONS WHO HAD
DIRECT AND GREATER ACCESS IN THE CASH-IN-VAULT?
4. IS RULE 111 SECTION 2 (a) OF THE REVISED RULES ON CRIMINAL PROCEDURE
APPLICABLE IN (sic)THE CASE AT BAR?
5. WAS THERE A VALID PROCEEDING WHEN THE FISCAL WAS NOT ACTUALLY PRESENT
AND DID NOT CONTROL AND SUPERVISE THE PROSECUTION OF THE CASE?
In gist, (1) petitioner contends that the trial court erred in taking into account the results of the polygraph
examination as circumstantial evidence of guilt considering the inherent unreliability of such tests, and
the fact that the previous trial judge who handled the case already ruled such evidence as inadmissible;
(2) petitioner insists that there can be no presumption of misappropriation when there were other persons
who had access to the cash in vault; and (3) petitioner questions the validity of the trial of criminal case
considering that the pre-trial agreement dispensed with the intervention of the public prosecutor in a full-
blown trial of the criminal case.
The Oce of the Solicitor General, for the State, contends that the guilt of petitioner has been proven
beyond reasonable doubt by the following facts which were duly established during trial first, petitioner
was the cash custodian who was directly responsible and accountable for the cash-in-vault. Second, the
other persons who had access to the vault facilities never used the duplicate keys to open the safety
deposit boxes and the cash safe from where the P100.00 bill denominations were located. In fact, the
duplicate keys were oered in evidence still in their sealed envelopes. Third, alterations and
superimposition on the cash-in-
For August 18, 2017 vault summary sheet were made by petitioner to cover the cash shortage. Lastly,
there was a valid joint trial of the civil and criminal cases.
The crucial issues, in our mind, are (1) whether there was a valid trial of the criminal case, and (2) whether
the elements of the crime of estafa under Article 315 (1)
(b) of the Revised Penal Code were duly proven beyond reasonable doubt.
First, petitioner assails the validity of the proceedings in the trial court on the ground that the public
prosecutor did not intervene and present any evidence during the trial of the criminal case. The records
clearly show that the pre-trial agreement was prepared by petitioner with the conforme of the public
prosecutor. Thereafter, petitioner filed a consolidated memorandum for both civil and criminal cases.
Section 5 of Rule 110 15 requires that all criminal actions shall be prosecuted under the direction and
control of the public prosecutor. The rationale behind the rule is "to prevent malicious or unfounded
prosecutions by private persons." 16 The records show that the public prosecutor actively participated in
the prosecution of the criminal case from its inception. It was during pre-trial conference when the parties
agreed to adopt their respective evidence in the civil case to the criminal case. This is allowed under
Section 2 (e) of Rule 118 of the Rules of Court 17 which provides that during pre-trial conference, the
parties shall consider "such other matters as will promote a fair and expeditious trial." The parties, in
compliance with Section 4 of Rule 118, 18 reduced to writing such agreement. Petitioner, her counsel,
and the public prosecutor signed the agreement. Petitioner is bound by the pre-trial agreement, and she
cannot now belatedly disavow its contents. 19
On the second issue. Petitioner was charged with the crime of estafa under Article 315 (1) (b) of the
Revised Penal Code. 20 In general, the elements of estafa are:
(1) that the accused defrauded another (a) by abuse of confidence or (b) by means of deceit; and (2) that
damage or prejudice capable of pecuniary estimation is caused to the oended party or third person. 21
Deceit is not an essential requisite of estafa with abuse of confidence, since the breach of confidence
takes the place of the fraud or deceit, which is a usual element in the other estafas. 22
The elements of estafa through conversion or misappropriation under Art. 315 (1) (b) of the Revised
Penal Code are: 23
(1) that personal property is received in trust, on commission, for administration or under any other
circumstance involving the duty to make delivery of or
!27 of 105!
to return the same, even though the obligation is guaranteed by a bond;
(2) that there is conversion or diversion of such property by the person who has so received it or
a denial on his part that he received it;

(3) that such conversion, diversion or denial is to the injury of another; and

(4) that there be demand for the return of the property.

Have the foregoing elements been met in the case at bar? We find the first element absent. When the
money, goods, or any other personal property is received by the oender from the oended party (1) in
trust or (2) on commission or (3) for administration, the oender acquires both material or physical
possession and juridical possession of the thing received. 24 Juridical possession means a possession
which gives the transferee a right over the thing which the transferee may set up even against the owner.
25 In this case, petitioner was a cash custodian who was primarily responsible for the cash-in-vault. Her
possession of the cash belonging to the bank is akin to that of a bank teller, both being mere bank
employees.

In People v. Locson, 26 the receiving teller of a bank misappropriated the money received by him for the
bank. He was found liable for qualified theft on the theory that the possession of the teller is the
possession of the bank. We explained in Locson that "The money was in the possession of the
defendant as receiving teller of the bank, and the possession of the defendant was the possession of the
bank. When the defendant, with grave abuse of confidence, removed the money and appropriated it to
his own use without the consent of the bank, there was the taking or apoderamiento contemplated in the
definition of the crime of theft." 27

In the subsequent case of Guzman v. Court of Appeals, 28 a travelling sales agent misappropriated or
failed to return to his principal the proceeds of things or goods he was commissioned or authorized to
sell. He was, however, found liable for estafa under Article 315 (1) (b) of the Revised Penal Code, and
not qualified theft. In the Guzman case, we explained the distinction between possession of a bank teller
and an agent for purposes of determining criminal liability

"The case cited by the Court of Appeals (People vs. Locson, 57 Phil. 325), in support of its theory that
appellant only had the material possession of the merchandise he was selling for his principal, or their
proceeds, is not in point. In said case, the receiving teller of a bank who misappropriated money received

For August 18, 2017 by him for the bank, was held guilty of qualified theft on the theory that the
possession of the teller is the possession of the bank. There is an essential distinction between the
possession by a receiving teller of funds received from third persons paid to the bank, and an agent who
receives the proceeds of sales of merchandise delivered to him in agency by his principal. In the former
case, payment by third persons to the teller is payment to the bank itself; the teller is a mere custodian
or keeper of the funds received, and has no independent right or title to retain or possess the same as
against the bank. An agent, on the other hand, can even assert, as against his own principal, an
independent, autonomous, right to retain money or goods received in consequence of the agency; as
when the principal fails to reimburse him for advances he has made, and indemnify him for damages
suered without his fault (Article 1915, [N]ew Civil Code; Article 1730, old).

Petitioner herein being a mere cash custodian had no juridical possession over the missing funds. Hence,
the element of juridical possession being absent, petitioner cannot be convicted of the crime of estafa
under Article 315, No. 1 (b) of the Revised Penal Code. 29

WHEREFORE, the petition is hereby granted and petitioner is ACQUITTED of the crime of estafa under
Article 315 (1) (b) of the Revised Penal Code. Petitioner is ordered RELEASED from custody unless she
is being held for some other lawful cause. No costs.

SO ORDERED.

Bellosillo, Mendoza, Buena and De Leon, Jr., JJ., concur.

SECOND DIVISION
[G.R. No. 164823. August 31, 2005.] MARIA CARLOS, represented by TERESITA CARLOS VICTORIA,
petitioner, vs. REPUBLIC OF THE PHILIPPINES, respondent.
Erlinda Francia Contreras for petitioner. The Solicitor General for respondent.
DECISION
PUNO, J p:
This is a petition for review on certiorari to annul the decision of the Court of Appeals in CA-G.R. CV No.
76824 entitled "Re: Application for Land Registration of a Parcel of Land in Taguig, Metro Manila, Maria
Carlos represented by Teresita Carlos Victoria, Applicant-Appellee vs. Republic of the Philippines
through the Oce of the Solicitor General, Oppositor-Appellant.
!28 of 105!
On December 19, 2001, petitioner Maria Carlos, represented by her daughter, Teresita Carlos Victoria,
filed an application for registration and confirmation of title over a parcel of land with an area of 3,975
square meters located at Pusawan, Ususan, Taguig, Metro Manila, covered by Plan Psu-244418.
Petitioner alleged, among others, that she is the owner of said parcel of land which she openly,
exclusively and notoriously possessed and occupied since July 12, 1945 or earlier under a bona fide
claim of ownership; that there is no mortgage or encumbrance aecting said property, nor is it part of any
military or naval reservation; that the property is being used for industrial purposes; and that there are no
tenants or lessees on the property. Petitioner further claimed that she has been in possession of the
subject land in the concept of an owner; that her possession has been peaceful, public, uninterrupted
and continuous since 1948 or earlier; and tacking her possession with that of her predecessors-in-
interest, petitioner has been in possession of the land for more than 50 years. 1
The Republic of the Philippines, represented by the Director of Lands, filed an opposition to petitioner's
application. 2
During the initial hearing, however, only petitioner and her counsel appeared. They presented
documentary evidence to prove the jurisdictional requirements. 3
Petitioner later presented testimonial evidence consisting of the testimonies of her neighbors, Sergio
Cruz and Daniel Castillo, and Teresita Carlos Victoria herself. 4
Sergio Cruz, 83 years old, a native of Ususan, Taguig, and neighbor of Maria Carlos, testified that the
property subject of the application was previously owned and possessed by Jose Carlos. He planted it
with palay and sold the harvest. Everyone in the community knew him as the owner of said parcel of land.
He also paid the taxes thereon. After the death of Jose Carlos in 1948, his daughter, Maria Carlos,
inherited the property and immediately took possession thereof. Her possession was peaceful, open,
public, continuous, uninterrupted, notorious, adverse and in the concept of an owner. When Maria Carlos
died, her heirs took over the property. 5
Cruz's testimony was corroborated by Daniel Castillo, 76 years old, Barangay Captain of Ususan, Taguig.
6 over the land in question. 11
Teresita Carlos Victoria stated on the witness stand that her mother, Maria Carlos, was in possession of
the subject property until she passed away on January 6, 2001. Upon the demise of Maria Carlos, Victoria
took possession of the property with the consent of her
For August 18, 2017 brothers and sisters. She characterized Maria Carlos's possession as peaceful,
open, public, continuous, adverse, notorious and in the concept of an owner. She has never been
disturbed in her possession; the whole community recognized her as the owner of the land; she declared
the land for tax purposes; and she paid the taxes thereon. In addition, Victoria informed the court that the
heirs of Maria Carlos have not yet instituted a settlement of her estate. However, they have agreed to
undertake the titling of the property and promised to deliver the certificate of title to Ususan Development
Corporation which bought the property from Maria Carlos. Victoria admitted that her mother had sold the
land to Ususan Development Corporation in 1996 but failed to deliver the title. Hence, the heirs of Maria
Carlos made a commitment to the corporation to deliver the certificate of title so that they could collect
the unpaid balance of the purchase price. 7
Petitioner also presented in court the concerned ocers of the Department of Environment and Natural
Resources (DENR) to establish that the land in question is alienable and disposable. cCAIDS
Elvira R. Reynaldo, Records Ocer, DENR Lands Management Bureau, appeared to certify that their
oce "has no record of any kind of public land application/land patent covering the parcel of land situated
at Ususan, Taguig, Rizal, identified/described in Plan Psu-244418." 8
Ulysses Sigaton, Land Management Inspector, DENR
National Capital Region, stated that he conducted an ocular inspection of the subject property and
found that it is within the alienable and disposable area under Project No. 27-B, LC Map No. 2623,
certified by the Bureau of Forest Development on January 4, 1968. He also noted that the land is being
used for industrial purposes. It had several warehouses, four big water tanks and is enclosed by a fence.
9
The trial court granted the application in its decision dated October 24, 2002. It held:
After considering the applicant's evidence ex-parte which is based on factual and meritorious grounds,
and considering that the applicant acquired the property under registration through inheritance from her
father, Jose Carlos, and considering further that her possession thereof, tacked with that of her
predecessor-in-interest, is open, continuous, exclusive, notorious and undisturbed, under claim of
ownership since time immemorial up to the present time; and considering further that the subject parcel
of land is part of the disposable and alienable land (Tsn, July 3, 2002, p.6) and considering further that
the realty taxes due thereon have been religiously paid (Exhs. "HH,"
!29 of 105!
"II," "JJ," and "JJ-1"), and considering finally that the subject parcel of land belong[s] to the applicant and
that she possess[es] a perfect title thereto which may be confirmed and registered in her name under the
(P)roperty Registration Decree (P.D. 1529), the herein application is hereby GRANTED. 10
On appeal, the Court of Appeals reversed and set aside the decision of the trial court. It noted that:
In the instant case, the applicant at the time she filed her application for registration of title was no longer
in possession and occupation of the land in question since on October 16, 1996, the applicant's mother
and predecessor-in-interest sold the subject land to Ususan Development Corporation. This was admitted
by witness Teresita Carlos Victoria . . .
Clearly, as early as 1996, possession and occupation of the land in question pertains not to the applicant
but to Ususan Development Corporation, thus it can be said that the applicant has no registrable title
Hence, this petition.
We arm the findings of the appellate court.
Applicants for confirmation of imperfect title must prove the following: (a) that the land forms part of the
disposable and alienable agricultural lands of the public domain; and (b) that they have been in open,
continuous, exclusive, and notorious possession and occupation of the same under a bona fide claim of
ownership either since time immemorial or since June 12, 1945. 12

As found by the Court of Appeals, petitioner has met the first requirement but not the second.

The Court held in Republic vs. Alconaba 13 that the applicant must show that he is in actual possession
of the property at the time of the application, thus:

The law speaks of possession and occupation. Since these words are separated by the conjunction
["]and["], the clear intention of the law is not to make one synonymous with the other. Possession is
broader than occupation because it includes constructive possession. When, therefore, the law adds the
word occupation, it seeks to delimit the all-encompassing eect of constructive possession. Taken
together with the words open, continuous, exclusive and notorious, the word occupation serves to
highlight the fact that for an applicant to qualify, his possession must not be a mere fiction. Actual
possession of a land consists in the manifestation of acts of dominion over it of such a

For August 18, 2017 nature as a party would naturally exercise over his own property.

It is clear in the case at bar that the applicant, Maria Carlos, no longer had possession of the property at
the time of the application for the issuance of a certificate of title. The application was filed in court on
December 19, 2001. Teresita Carlos Victoria, the daughter of Maria Carlos, admitted during the hearing
that her mother had sold the property to Ususan Development Corporation in 1996. They also presented
as evidence the deed of absolute sale executed by and between Maria Carlos and Ususan Development
Corporation on October 16, 1996. 14 The document states, among others:

xxx xxx xxx

4. That the VENDOR, by this Deed hereby transfer(s) possession of the property to the VENDEE.

This contradicts petitioner's claim that she was in possession of the property at the time that she applied
for confirmation of title.

Nonetheless, even if it were true that it was petitioner who had actual possession of the land at that time,
such possession was no longer in the concept of an owner. Possession may be had in one of two ways:
possession in the concept of an owner and possession of a holder. A possessor in the concept of an
owner may be the owner himself or one who claims to be so. On the other hand, one who possesses as
a mere holder acknowledges in another a superior right which he believes to be ownership, whether his
belief be right or wrong. 16 Petitioner herein acknowledges the sale of the property to Ususan
Development Corporation in 1996 and in fact promised to deliver the certificate of title to the corporation
upon its obtention. Hence, it cannot be said that her possession since 1996 was under a bona fide claim
of ownership. Under the law, only he who possesses the property under a bona fide claim of ownership
is entitled to confirmation of title.

We therefore find that the Court of Appeals did not err in denying the issuance of a certificate of title to
petitioner.

IN VIEW WHEREOF, the petition is DENIED. SO ORDERED.

Austria-Martinez, Callejo, Sr., Tinga and Chico-Nazario, JJ., concur.

30! of 105!
THIRD DIVISION
[G.R. No. 116220. December 6, 2000.]
SPOUSES ROY PO LAM and JOSEFA ONG PO LAM, petitioners, vs. COURT OF APPEALS and FELIX
LIM now JOSE LEE, respondents.
Valdez Maulit & Associates for petitioners. Atty. Oliver O. Olaybal for private respondent.
RESOLUTION
MELO, J p:
On October 13, 1999, this Division, under the ponencia of Mr. Justice Purisima handed down a decision
declaring petitioners, the spouses Roy Po Lam and Josefa Ong Po Lam, as transferees pendente lite
and not purchasers in good faith of Lots No. 1557 and 1558 and ordering them to reconvey said lots to
private respondent Jose Lee.
Forthwith, petitioners filed a motion for reconsideration which was received hereat on November 15,
1999. Respondents thereupon filed their opposition, as well as a separate comment, to which petitioners
submitted a reply.
Regrettably, however, for one reason or another, the motion for reconsideration remained unacted upon
until the retirement of Justice Purisima in October, 2000, notwithstanding the fact that it was calendared
or placed in the Court's agenda a number of times, as well as the urgings of both parties to have the
matter resolved.
Thus, with Justice Purisima leaving the Court and, in accordance with A.M. No. 99-8-99 promulgated by
the Court En Banc on February 15, 2000, the matter of the motion for reconsideration was assigned by
rae to herein ponente for study and the preparation of the appropriate action.
A review of the facts, uncontroverted though they are, is in order.
Lots No. 1557 and 1558 are prime commercial lots located in the heart of Legaspi City's commercial
district. These were sold by Lim Kok Chiong to the Legaspi Avenue Hardware Company (hereafter
referred to as LAHCO) sometime in the early 60's. On December 4, 1964, however, Felix Lim, Lim Kok
Chiong's brother, filed a complaint with the then Court of First Instance of Albay against his brother and
LAHCO to annul the deeds of sale covering said lots on the ground that the sale included the 3/14 pro-
indiviso portion of the lots which Felix Lim had inherited from his foster parents. The complaint was
docketed as Civil Case No. 2953 of the Court of First Instance of Albay.
For August 18, 2017
On January 27, 1365, Felix Lim filed with the Register of Deeds of Albay a notice of lis pendens over the
two lots. The same was inscribed on Transfer Certificates of Title No. 2580 and 2581, covering Lots No.
1557 and 1558, respectively. Later, the trial court, on motion of Felix Lim, dropped the case against Lim
Kok Chiong. On March 15, 1969, the trial court rendered a decision declaring LAHCO to be the absolute
owner of the two above-mentioned lots. As a consequence of its decision, the trial court ordered the
cancellation of the notice of lis pendens inscribed on the titles of the two lots. Pursuant to this order, the
notice of lis pendens inscribed on TCT No. 2580 was cancelled. However, the notice of lis pendens
annotated on TCT No. 2581 remained uncancelled, allegedly because the duplicate owner's copy of said
TCT was with the Continental Bank, Lot No. 1558 having been mortgaged by LAHCO to said bank.
Aggrieved, Felix Lim appealed to the Court of Appeals. On May 28, 1970, and during the pendency of
the appeal, CA-G.R. No. 44770-R, LAHCO sold the two lots to herein petitioners, the spouses Roy Po
Lam and Josefa Ong Po Lam. On May 20, 1974, petitioners, by virtue of the court order adverted to
earlier, had the notice of lis pendens still inscribed on TCT No. 2581 cancelled. Felix Lim did not move
for the reinstatement of the cancelled notices of lis pendens on TCT No. 2580 and 2581. Thereafter, said
certificates of title were themselves cancelled and replaced by TCT No. 8102 and 13711, respectively, in
the name of petitioners.
On April 29, 1980, the Court of Appeals armed the decision of the trial court in Civil Case No. 2953,
appellant Felix Lim's counsel receiving a copy of thereof on May 16, 1980. On May 23, 1980, counsel for
Felix Lim filed a motion for extension of time to file a motion for reconsideration. The appellate court gave
Felix Lim up to June 20, 1980 to file one. On June 17, 1980, he filed a motion for reconsideration, which
was, however, denied. Without leave of court, Felix Lim filed, on July 14, 1980, a second motion for
reconsideration. This was acted upon favorably by the Court of Appeals on March 11, 1981, with the
appellate court declaring that Felix Lim, by returning P20,000.00 to LAHCO, could exercise the right of
redemption over the two lots sold by Lim Kok Chiong to LAHCO. Although LAHCO asked this Court for
an extension of time to file a petition for review, none was ever filed, for which reason the Court remanded
the case to the trial court for execution.
On November 12, 1981, Felix Lim moved, in Civil Case No. 2953, to have the March 11, 1981 resolution
of the Court of Appeals annotated on TCT No. 8102 and 13711. He also moved for the issuance of a writ
of execution to enforce said resolution. Likewise, he filed
!31 of 105!
a motion praying that the Clerk of Court execute a deed of conveyance over the disputed lots in his favor.
All these motions were denied by the trial court on the ground that the Po Lam spouses could not be
bound thereby since they were not impleaded as party-litigants in Civil Case No. 2953 or CA-G.R. No.
44770-R. However, the trial court reserved to Felix Lim "the right to institute an action on whether or not
the acquisition of the properties in question by spouses Roy Po Lam and Josefa Ong Po Lam were made
in good faith or bad faith.
In consonance with this ruling, Felix Lim filed a complaint for reconveyance and annulment of the sale
and titles of said lots with the Regional Trial Court of Legaspi City, which was docketed therein as Civil
Case No. 6767.
On September 19, 1985, Felix Lim filed with the trial court, in the old case, Civil Case No. 2953, a motion
to include as defendants the Po Lam spouses, as well as to execute the March 11, 1981 resolution of the
Court of Appeals. Both motions were denied. On appeal (CA-G.R. No. 08533-CV), the Court of Appeals
upheld the denial. Felix Lim appealed the decision to this Court.
In the meantime, in June, 1970, or one month after the Po Lam spouses had purchased the two lots from
LAHCO, they leased the commercial building erected on Lot No. 1557 to private respondent Jose Lee
for one year. After the contract expired, Jose Lee continued to occupy the same, paying monthly rentals
therefor. However, after September 15, 1981, Jose Lee refused to pay rentals to the Po Lam spouses,
informing them that he would deposit the same in court since Felix Lim had promised to sell the property
to him. Lee's failure to pay rentals prompted the Po Lam spouses to file an unlawful detainer case against
him with the Metropolitan Trial Court of Legaspi City.
On October 29, 1990, Felix Lim assigned all his rights to and interests in the disputed lots to Jose Lee,
who then substituted Felix Lim as party plainti, now private respondent.
On December 19, 1993, the Metropolitan Trial Court of Legaspi City declared the Po Lam spouses to be
the lawful owners of Lot No. 1557. On appeal, said judgment was armed by the regional trial court and
thereafter, by the Court of Appeals in CA-G.R. No. 12316-SP. Aggrieved, Jose Lee filed an appeal with
this Court, which consolidated the case with the appeal filed in CA-G.R. No. 08533-CV where the trial
court in the original 1965 case refused to have petitioners impleaded as defendants, and to execute the
March 11, 1981 resolution of the Court of Appeals, were upheld by the appellate court.
For August 18, 2017

It must be mentioned that in both CA-G.R. No. 12316-SP and CA-G.R. No. 08533-CV, the appellate court
ruled that the March 11, 1981 resolution of the Court of Appeals in CA-G.R. No. 44770-R was null and
void on the ground that the decision it had issued earlier on April 29, 1980 had already become final and
executory when the above-said resolution was promulgated. The appellate court ruled that Felix Lim's
counsel should not have filed a motion for extension of time to file a motion for reconsideration, the same
being a prohibited pleading under the rule laid down in Habaluyas v. Japson (138 SCRA 46 [1985]). Being
a prohibited pleading, it was held that the extension granted to Lim did not arrest the running of the 15-
day period. Thus, when Lim filed his motion for reconsideration on June 17, 1980, the same was already
filed out of time, he having received a copy of the judgment of armance on May 16, 1980.
The above finding of the appellate court was, however, debunked by this Court in G.R. No. 84145-55
(Lim v. Court of Appeals, 188 SCRA 23 [1988]) where we held that Habaluyas v. Japson (supra) must be
applied prospectively so that "when petitioner Lim filed thru registered mail on May 23, 1980 his motion
for extension of time to file a motion for reconsideration, the motion was deemed properly filed contrary
to the respondent court's ruling that it was a prohibited pleading.
Ruling on the appeals filed from CA-G.R. No. 12316-SP and CA-G.R. No. 08533-CV, this Court thus
declared, on February 18, 1988, in Lim vs. CA cited in the immediately preceding paragraph that:
ACCORDINGLY, the decisions appealed from are modified. The portions of the appealed decisions
dealing with the March 11, 1981 resolution in CA-G.R. No. 44770-R are reversed and set aside and the
said resolution is ordered reinstated. The decisions are armed in all other respects. Costs against
private respondents.
SO ORDERED.
In the interim, Civil Case No. 6767 for reconveyance and annulment of sale and titles filed by Felix Lim
(now Jose Lee) went on until, on January 14, 1992, the Regional Trial Court of Legaspi City rendered a
decision declaring the spouses Roy Po Lam and Josefa Ong Po Lam as transferees pendente lite and
not purchasers in good faith. It held that the Po Lam spouses were bound by the March 11, 1981
resolution rendered in CA-G.R. No. 44770-R. The Po Lam spouses forthwith appealed to the Court of
Appeals (CA-G.R. CV No. 37452) but said Court, on June 30, 1993, armed the trial court's decision.
!32 of 105!
The Po Lam spouses thus filed a petition for certiorari with this Court. On October 13, 1999, we denied
the petition and armed in toto the decision of the Court of Appeals in CA-G.R. CV No. 37452. We held
that the Po Lam spouses could not be deemed buyers in good faith, ratiocinating in the process:
As to Lot 1558, there is no question that they (petitioners) cannot be deemed buyers in good faith. The
annotation of lis pendens on TCT No. 2581 which covers Lot 1558, served as notice to them that the said
lot is involved in a pending litigation. Settled is the rule that one who deals with property subject of a
notice of lis pendens cannot invoke the right of a purchaser in good faith. Neither can he acquire better
rights than those of his predecessor in interest. A transferee pendente lite stands in the shoes of the
transferor and is bound by any judgment or decree which may be rendered for or against the transferor.
It is thus beyond cavil that the herein petitioners, who purchased Lot 1558 subject of a notice of lis
pendens, are not purchasers in good faith and are consequently bound by the Resolution dated March
11, 1981 of the Court of Appeals.
Can petitioners then be treated purchasers in good faith of Lot 1557 covered by TCT No. 2580
considering that the notice of lis pendens thereon had been already cancelled at the time of the sale?
We rule in the negative. It is a firmly settled jurisprudence that a purchaser cannot close his eyes to facts
which should put a reasonable man on guard and claim that he acted in good faith in the belief that there
was no defect in the title of the vendor. His mere refusal to believe that such a defect exist, or his willful
closing of his eyes to the possibility of the existence of a defect on his vendor's title, will not make him
innocent purchaser for value, if it develops afterwards that the title was in fact defective, and it appears
that he had notice of such defect as would have led to its discovery had he acted with that measure of
precaution which may reasonably be required of a prudent man in like situation.
In the case under consideration, there exist circumstances which should have placed are herein
petitioners on guard. As aptly stressed upon by the respondent court, while it is true that when the
petitioners purchased Lot 1557, the notice of lis pendens aecting said lot had been cancelled, it could
not be denied that such inscription appears on the Transfer Certificate of Title of the said lot together with
the cancellation of the notice of lis pendens. This fact coupled with the non-cancellation of the notice of
lis pendens on Transfer Certificate of Title No. 2581 covering Lot 1558, should have suciently alerted
the petitioners vis-a-vis a possible defect in the title of LAHCO, especially so that Lots 1557 and 1558
were
For August 18, 2017 simultaneously sold to the petitioners in a single deed of sale executed on May 28,
1969.
Undeterred, the Po Lam spouses filed a motion for reconsideration, alleging, inter alia, that it was error
to hold them as purchasers in bad faith.
The motion for reconsideration is impressed with merit. It must be stressed that the sole basis for finding
petitioners to be purchasers in bad faith was the subsistence of the notice of lis pendens inscribed on
TCT No. 2581, which covered Lot No. 1558, at the time petitioners-spouses purchased the lots in dispute.
And since Lot No. 1558 was sold simultaneously with Lot No. 1557, even if the notice of lis pendens on
Lot No. 1557 had already been cancelled, petitioners were held to be purchasers in bad faith even in
regard to Lot No. 1557.
However, it must be pointed out that even if a notice of lis pendens on TCT No. 2581 (Lot No. 1558) was
still subsisting at the time petitioners bought the property from LAHCO, there also was a court order
ordering that the annotation be cancelled, as in fact, it was cancelled on May 20, 1974.
A possessor in good faith has been defined as "one who is unaware that there exists a flaw which
invalidates his acquisition of the thing (See Article 526, Civil Code). Good faith consists in the possessor's
belief that the person from whom he received the thing was the owner of the same and could convey his
title (Pio v. CA, 198 SCRA 434 [1991]). In this case, while petitioners bought Lot No. 2581 from LAHCO
while a notice of lis pendens was still annotated thereon, there was also existing a court order canceling
the same. Hence, petitioners cannot be considered as being "aware of a flaw which invalidates their
acquisition of the thing" since the alleged flaw, the notice of lis pendens, was already being ordered
cancelled at the time of the purchase. On this ground alone, petitioners can already be considered buyers
in good faith.
More importantly, however, the notice of lis pendens inscribed on TCT No. 2581 was cancelled on May
20, 1974, pursuant to the order of the trial court in Civil Case No. 2953. Felix Lim did not move for the
reinstatement of the cancelled notices of lis pendens. What is the eect of this cancellation? To follow
the prior ruling of the Court in the instant case, the cancellation of the notice of lis pendens would have
no eect. Regardless of the cancellation of the notice of lis pendens, the Po Lam spouses are still
considered as having notice of a possible defect in the title of LAHCO, making them purchasers in bad
faith.
!33 of 105!
As we shall elucidate, hewing to such an interpretation misunderstands the nature and eect of a notice
of lis pendens. The meaning, nature, recording, and eects of a notice of lis pendens are clearly stated
in Section 14, Rule 13 of the 1997 Rules of Civil Procedure, thus:
SECTION 14. Notice of lis pendens. In an action aecting the title or the right of possession of real
property, the plainti and the defendant, when armative relief is claimed in his answer, may record in
the oce of the registry of deeds of the province in which the property is situated a notice of the pendency
of the action. Said notice shall contain the names of the parties and the object of the action or defense,
and a description of the property in that province aected thereby. Only from the time of filing such notice
for record shall a purchaser, or encumbrances of the property aected thereby, be deemed to have
constructive notice of the pendency of the action, and only of its pendency against the parties designated
by their real names.
The notice of lis pendens hereinabove mentioned may be cancelled only upon order of the court, are
proper showing that the notice is for the purpose of molesting the adverse party, or that it is not necessary
to protect the right of the party who caused it to be recorded.
Lis pendens literally means a pending suit or a pending litigation; and the doctrine of lis pendens has
been defined as the jurisdiction, power, or control which a court acquires over property involved in a suit,
pending the continuance of the action, and until final judgment therein (54 C.J.S. Lis Pendens 1). A
notice of lis pendens is an announcement to the whole world that a particular real property is in litigation,
serving as a warning that one who acquires an interest over said property does so at his own risk, or that
he gambles on the result of the litigation over the said property (AFPMBAI v. CA, G.R. No. 104769, March
3, 2000). The filing of a notice of lis pendens charges all strangers with a notice of the particular litigation
referred to therein and, therefore, any right they may thereafter acquire on the property is subject to the
eventuality of the suit (Laroza v. Guia, 134 SCRA 341 [1985]). Notice of lis pendens has been conceived
and, more often than not, availed of, to protect the real rights of the registrant while the case involving
such rights is pending resolution or decision. With the notice of lis pendens duly recorded, and while it
remains uncancelled, the registrant could rest secure that he would not lose the property or any part of it
during the litigation (People v. Regional Trial Court of Manila, 178 SCRA 299 [1989]).
The filing of a notice of lis pendens in eect (1) keeps the subject matter of the litigation within the power
of
For August 18, 2017 the court until the entry of the final judgment so as to prevent the defeat of the latter
by successive alienations; and (2) binds a purchaser of the land subject of the litigation to the judgment
or decree that will be promulgated thereon whether such a purchaser is a bona fide purchaser or not; but
(3) does not create a non-existent right or lien (Somes v. Government, 62 Phil. 432 [1935]).
The doctrine of lis pendens is founded upon reason of public policy and necessity, the purpose of which
is to keep the subject matter of the litigation within the power of the court until the judgment or decree
shall have been entered; otherwise by successive alienations pending the litigation, its judgment or
decree shall be rendered abortive and impossible of execution (Laroza v. Guia, supra; People v. Regional
Trial Court of Manila, supra). The doctrine of lis pendens is based on considerations of public policy and
convenience, which forbid a litigant to give rights to others, pending the litigation, so as to aect the
proceedings of the court then progressing to enforce those rights, the rule being necessary to the
administration of justice in order that decisions in pending suits may be binding and may be given full
eect, by keeping the subject matter in controversy within the power of the court until final adjudication,
that there may be an end to litigation, and to preserve the property that the purpose of the pending suit
may not be defeated by successive alienations and transfers of title (54 C.J.S. Lis Pendens, supra).
From the above, it can be seen that the basis of the doctrine of lis pendens is public policy and
convenience, under the view that once a court has taken cognizance of a controversy, it should be
impossible to interfere with consummation of the judgment by any ad interim transfer, encumbrance, or
change of possession (51 Am Jur 2d, Lis Pendens, 3). However, to hold that the Po Lam spouses are
still bound by the results of the litigation over the property, despite and notwithstanding the cancellation
of the notices of lis pendens prior to the termination of litigation, would consider the doctrine of lis pendens
as one of implied or constructive notice. This view is erroneous.
While the doctrine of lis pendens is frequently spoken of as one of implied or constructive notice,
according to many authorities, the doctrine is not founded on any idea of constructive notice, since its
true foundation rests, as has already been stated, on principles of public policy and necessity. The lis
pendens annotation, although considered a "general notice to all the world, . . . it is not correct to speak
of it as part of the doctrine of notice; the purchaser pendente lite is aected, not by notice, but because
the law does not
!34 of 105!
allow litigating parties to give to others, pending the litigation, rights to the property in dispute as to
prejudice the opposite party. The doctrine rests upon public policy, not notice" (Tirado v. Sevilla, 188
SCRA 321 [1990]). "The doctrine of lis pendens, as generally understood and applied by the courts of
this country, is not based upon presumption of notice, but upon a public policy, imperatively demanded
by a necessity which can be met and overcome in no other way. It is careless 'use of language which
has led judges to speak of it as notice, because it happens to have in some instance similar eect with
notice' (Smith v. Kimball, 13 P. 801, 36 Kan. 474).
And since the doctrine rests on public policy, not notice, upon the cancellation of the notice of lis pendens,
the Po Lam spouses cannot then be considered as having constructive notice of any defect in the title of
LAHCO as to make them transferees pendente lite and purchasers in bad faith of Lots No. 1557 and
1558. To hold otherwise would render nugatory the cancellation of the notices of lis pendens inscribed
on TCT Nos. 2580 and 2581. Dierently stated, to hold the Po Lam spouses still bound by the notice of
lis pendens inscribed on TCT No. 2581 despite its subsequent cancellation on May 20, 1974, would
render said cancellation an empty, unavailing, and purposeless act, which could not have been the intent
of the law. Lex neminem cogit ad van seu inutilia peragenda. The law will not compel one to do useless
things.
As adverted to earlier, while the notice of lis pendens is duly recorded and as long as it remains
uncancelled, the litigant can rest secure that he would not lose the property or any part of it during
litigation. Conversely, cancellation of the notice of pendency terminates the eects of such notice.
Therefore, with the cancellation of the notices of lis pendens on TCT No. 2580 and 2581, the eects of
such notice were terminated, resulting in the Po Lam spouses not being bound thereby. In fine, they
cannot be considered transferees pendente lite and purchasers in bad faith of the property.
Moreover, since its operation is arbitrary and it may be harsh in particular instances, the doctrine of lis
pendens is to be strictly construed and applied. It should not be extended without strict necessity (54
C.J.S. Lis Pendens 1). To consider the Po Lam spouses still bound by the notice of lis pendens even
after the same had been cancelled would be extending the doctrine when there is no reason therefor.
Lastly, Felix Lim's claim is barred by the equitable principle of laches. At the time the notices of lis
pendens were cancelled in 1969 and 1974, Felix Lim
For August 18, 2017 did not move to reinstate the same. Nor did he act when TCT No. 2580 and 2581
were replaced by TCT No. 8102 and 13711. Instead, he waited seven years, or until 1981, to have his
claim on the disputed pieces of property recognized. Felix Lim's long inaction and passivity in asserting
his rights over the disputed property precludes him from recovering them from petitioners-spouses.
WHEREFORE, premises considered, the Motion for Reconsideration of petitioners-spouses Roy Po Lam
and Josefa Ong Po Lam is hereby GRANTED. Consequently, the decision dated October 13, 1999, is
VACATED and SET ASIDE. A new judgment is hereby entered declaring petitioners - spouses to be
PURCHASERS IN GOOD FAITH and Transfer Certificates of Title No. 8102 and 13711 in their name
valid, without prejudice on the part of private respondent Jose Lee to file a separate action for
reimbursement for the value of said property from the Legaspi Avenue Hardware Company.
SO ORDERED.
Vitug, Panganiban, and Gonzaga-Reyes, JJ., concur.
FIRST DIVISION
[G.R. No. 153625. July 31, 2006.]
HEIRS OF MARCELINO CABAL, represented by VICTORIA CABAL, petitioner, vs. SPOUSES
LORENZO CABAL 1 and ROSITA CABAL, respondents.
DECISION
AUSTRIA-MARTINEZ, J p:
Before the Court is a petition for review on certiorari under Rule 45 of the 1997 Rules of Civil Procedure
assailing the Decision 2 of the Court of Appeals (CA) dated September 27, 2001 in CA-G.R. SP No.
64729 which armed in toto the Decision of the Regional Trial Court, Branch 70, Iba, Zambales (RTC)
dated August 10, 2000 in Civil Case No. RTC-1489-I; and the CA Resolution 3 dated May 22, 2002 which
denied the Motion for Reconsideration of Marcelino Cabal (Marcelino).
The factual background of the case is as follows:
During his lifetime, Marcelo Cabal (Marcelo) was the owner of a 4,234-square meter parcel of land
situated at Barrio Palanginan, Iba, Zambales, described as Lot G and covered by Original Certificate of
Title (OCT) No. 29 of the Registry of Deeds of Zambales.
Sometime in August 1954, 4 Marcelo died, survived by his wife Higinia Villanueva (Higinia) and his
children:
!35 of 105!
Marcelino, Daniel, Cecilio, Natividad, Juan, Margarita, Lorenzo, Lauro and Anacleto. 5 It appears that
sometime in 1949, five years before he died, Marcelo allowed his son, Marcelino, to build his house on a
portion of Lot G, now the southernmost portion of Lot 1-E of Transfer Certificate of Title (TCT) No. 43419.
6 Since then, Marcelino resided thereon. 7 Later, Marcelino's son also built his house on the disputed
property. 8
On August 17, 1964, Marcelo's heirs extra-judicially settled among themselves Lot G into undivided equal
shares of 423.40-square meters each and Transfer Certificate of Title (TCT) No. T-8635 was issued in
their names. 9
On September 17, 1973, Daniel sold 380 square meters of his 423.40-square meter undivided share to
spouses Oscar Merete and Clarita Ebue. 10
On September 12, 1976, the heirs subdivided Lot G into Lot G-1 in favor of Marcelino, resulting in the
issuance of TCT No. T-22656; 11 and Lot G-2 in favor of Higinia, Daniel, Natividad, Juan, Cecilio,
Margarita, Lorenzo, Lauro and Anacleto, resulting in the issuance of TCT No. 22657. 12
On March 1, 1977, Marcelino mortgaged his share, as described under TCT No. 22656, to the Rural
Bank of San Antonio (Zambales), Inc. 13 The mortgage on the property was subsequently released on
December 19, 1983. 14
In the interim, based on consolidated subdivision plan (LRC) Pcd-24078, Lot G-2 was further subdivided
and the remaining portion, known as Lot 1 of the subdivision plan, comprising 3387.20 square meters,
became subject of TCT No. T-24533 with Higinia, Margarita, Natividad, Lorenzo, Daniel, Oscar Merete,
Cecilio, Carmelita C. Pagar, and Anacleto as co-owners.
On August 3, 1978, the co-owners of Lot 1 executed a Deed of Agreement of Partition with Sale. Lot 1
was subdivided among the co-owners with Higinia, Margarita, Natividad, Lorenzo, Cecilio, Carmelita C.
Pagar and Anacleto, receiving 423.40 square meters each; Daniel, with 43.4 square meters; and Oscar
Merete, with 380 square meters. 15 In the same deed, Lorenzo bought the shares of Higinia, Margarita,
Daniel and Natividad. 16 Thus, Lorenzo's share in the co-ownership amounted to 1,737 square meters.
Likewise, in the same deed, Cecilio sold his share to a certain Marcela B. Francia. 17
On January 13, 1982, a land survey was conducted on Lot 1 by Geodetic Engineer Dominador L. Santos
and
For August 18, 2017
Junior Geodetic Engineer Eufemio A. Abay and based on the survey, they submitted subdivision survey
plan (LRC) Psd-307100, designating the shares of Carmelita C. Pagar, Marcela B. Francia, spouses
Oscar Merete and Clarita Ebue, Anacleto, and Lorenzo as Lots 1-A, 1-B, 1-C, 1-D and 1-E, respectively.
18 The subdivision survey plan of Lot 1 was approved by the Director of the Bureau of Lands on May 7,
1982. 19 On June 7, 1990, the co-owners of Lot 1 executed a Subdivision Agreement designating their
shares based on the approved subdivision plan. 20 On July 13, 1993, TCT No. 43419 covering Lot 1-E
was issued in the name of Lorenzo. 21
In the meantime, since the subdivision plan revealed that Marcelino and his son occupied and built their
houses on a 423-square meter area located on the southernmost portion of Lot 1-E and not the adjacent
lot designated as Lot G-1 under TCT No. T-22656, 22 the spouses Lorenzo and Rosita Cabal
(respondents) confronted Marcelino on this matter which resulted to an agreement on March 1, 1989 to
a re-survey and swapping of lots for the purpose of reconstruction of land titles. 23 However, the agreed
resurvey and swapping of lots did not materialize 24 and eorts to settle the dispute in the barangay level
proved futile. 25 Hence, on August 10, 1994, respondents filed a complaint for Recovery of Possession
with Damages against Marcelino before the Municipal Trial Court of Iba, Zambales (MTC), docketed as
Civil Case No. 735. They alleged that Marcelino introduced improvements in bad faith on their land with
knowledge that the adjacent lot is titled in his name. 26
On August 26, 1994, Marcelino filed his Answer with Counterclaim, contending that respondents have no
cause of action against him because he has been in possession in good faith since 1949 with the
respondents' knowledge and acquiescence. He further avers that acquisitive prescription has set in. 27
On January 24, 1997, during the pendency of the trial of the case, Lorenzo died. Following trial on the
merits, the MTC rendered on November 19, 1997 its Decision 28 in favor of Marcelino, the dispositive
portion of which reads: HcISTE
WHEREFORE, on the basis of the foregoing premises as adduced by this Court the plainti or their
representatives are hereby directed to relinquish the possession of said property subject matter of this
case and deliver the peaceful possession of the same to the herein defendant or his authorized
representatives, to remove the improvements made thereon within fifteen (15) days from the receipt of
this decision, otherwise, this Court would remove and/or destroy the same with cost against the plainti,
further the plainti is hereby
!36 of 105!
ordered to pay the amount of Ten Thousand Pesos (P10,000.00), Philippine Currency representing moral
damages and exemplary damages in the amount of Five Thousand Pesos (P5,000.00), Philippine
Currency, and the amount of Twenty Thousand Pesos (P20,000.00), Philippine Currency, representing
attorney's fees.
SO ORDERED. 29
The MTC reasoned that prescription or the length of time by which Marcelino has held or possessed the
property has barred the respondents from filing a claim. On December 12, 1997, respondents filed a
Motion for Reconsideration 30 but the MTC denied it in its Order dated February 5, 1998. 31
Dissatisfied, respondents filed an appeal with the RTC Branch 70, Iba, Zambales, docketed as RTC-
1489-I. On August 10, 2000, the RTC rendered its Decision setting aside the Decision of the MTC. 32
The dispositive portion of the Decision states:
WHEREFORE, the appealed Decision of the Municipal Trial Court is hereby REVERSED and SET ASIDE
ordering the defendant Marcelino Cabal and all other persons claiming interest under him to vacate and
deliver peaceful possession of the disputed area of 423 sq. m. within Lot 1-E embraced in TCT No. T-
43419 to the plaintis-appellants; to remove all improvements therein introduced by said defendant or by
persons under his direction and authority; to pay the plaintis-appellants P10,000.00 and P5,000.00 by
way of moral and exemplary damages, respectively; to pay plainti-appellants attorney's fee in the sum
of P20,000.00 and cost of this suit.
SO ORDERED. 33
In reversing the MTC, the RTC held that Marcelino's possession was in the concept of a co-owner and
therefore prescription does not run in his favor; that his possession, which was tolerated by his co-owners,
does not ripen into ownership.
On August 30, 2000, Marcelino filed a Motion for Reconsideration 34 but the RTC denied it in its Order
dated May 3, 2001. 35
On May 18, 2001, Marcelino filed a petition for review with the CA, docketed as CA-G.R. SP No. 64729.
36 Marcelino, however, died during the pendency of the case. On September 27, 2001, the CA rendered
its Decision arming in toto the Decision of the RTC. 37
In sustaining the RTC, the CA held that Marcelino may have been in good faith when he started to occupy
the disputed portion in 1949 but his occupation in good faith diminished after Lot G was surveyed when
he was
For August 18, 2017 apprised of the fact that the portion he was occupying was not the same as the
portion titled in his name; that from the tenor of the petition for review Marcelino would like to hold on to
both the lot he occupies and Lot G-1, which cannot be allowed since it will double his inheritance to the
detriment of his brother Lorenzo.
On November 13, 2001, Marcelino's counsel filed a Motion for Reconsideration 38 but the CA denied it
in its Resolution dated May 22, 2002. 39
On June 6, 2002, the heirs of Marcelino (petitioners), represented by his widow, Victoria Cabal, filed the
present petition anchored on the following grounds:
I. CONTRARY TO THE COURT OF APPEALS' FINDINGS AND CONCLUSION, PETITIONER NEVER
INTENDED AND NEITHER DOES HE INTEND TO HOLD ON TO BOTH THE 423 SQUARE METER
WITHIN LOT 1-E WHICH HE IS OCCUPYING AND LOT 1-G (sic). PETITIONER IS ONLY INTERESTED
IN THE DISPUTED PROPERTY, THAT IS, A PORTION OF LOT 1-E BECAUSE THIS IS WHERE HE
INTRODUCED CONSIDERABLE IMPROVEMENTS IN GOOD FAITH.
I I . T H E H O N O R A B L E C O U RT O F A P P E A L S COMMITTED A REVERSIBLE ERROR
WHEN IT RULED THAT THE GOOD FAITH OF PETITIONER ON THE DISPUTED PROPERTY BEGAN
TO DIMINISH AFTER LOT-G WAS SURVEYED. 40
Anent the first ground, petitioners contend that since 1949 Marcelino has claimed no other portion as his
inheritance from Marcelo, except the disputed lot; that Marcelino believed in good faith that the disputed
lot is Lot G-1; that Marcelino never intended to hold on to both lots since he did not introduce any
improvement on Lot G-1 and he even agreed to a resurvey, swapping of lots and reconstruction of title
after discovery of the mistake in 1989; that Marcelino wanted the disputed lot because he has introduced
considerable improvements thereon.
On the second ground, petitioners maintain that Marcelino became aware of the flaw in his title only
before the execution of the swapping agreement in March 1, 1989, long after he had introduced
considerable improvements in the disputed lot; that Marcelino should not be faulted for believing that the
disputed lot is his titled property because he is a layman, not versed with the technical description of
properties; that Marcelino should be adjudged a builder in good faith of all the improvements built on the
disputed property immediately prior to the execution of the swapping agreement and accorded all his
rights under the law or, alternatively, the swapping of lots be
!37 of 105!
ordered since no improvements have been introduced on Lot G-1.
Respondents, on the other hand, submit that Marcelino cannot be adjudged a builder in good faith since
he exhibited blatant and deliberate bad faith in dealing with respondents.
The Court rules in favor of the petitioners.
As a general rule, in petitions for review, the jurisdiction of this Court in cases brought before it from the
CA is limited to reviewing questions of law which involves no examination of the probative value of the
evidence presented by the litigants or any of them. 41 The Supreme Court is not a trier of facts; it is not
its function to analyze or weigh evidence all over again. 42 Accordingly, findings of fact of the appellate
court are generally conclusive on the Supreme Court. 43
Nevertheless, jurisprudence has recognized several exceptions in which factual issues may be resolved
by this Court, such as: (1) when the findings are grounded entirely on speculation, surmises or
conjectures; (2) when the inference made is manifestly mistaken, absurd or impossible; (3) when there
is grave abuse of discretion; (4) when the judgment is based on a misapprehension of facts; (5) when the
findings of facts are conflicting; (6) when in making its findings the CA went beyond the issues of the
case, or its findings are contrary to the admissions of both the appellant and the appellee; (7) when the
findings are contrary to the trial court; (8) when the findings are conclusions without citation of specific
evidence on which they are based; (9) when the facts set forth in the petition as well as in the petitioner's
main and reply briefs are not disputed by the respondent; (10) when the findings of fact are premised on
the supposed absence of evidence and contradicted by the evidence on record; (11) when the CA
manifestly overlooked certain relevant facts not disputed by the parties, which, if properly considered,
would justify a dierent conclusion. 44 The Court finds that exceptions (1), (2), (4) and (11) apply to the
present petition.
It is undisputed that Marcelino built his house on the disputed property in 1949 with the consent of his
father. Marcelino has been in possession of the disputed lot since then with the knowledge of his co-
heirs, such that even before his father died in 1954, when the co-ownership was created, his inheritance
or share in the co-ownership was already particularly designated or physically segregated. Thus, even
before Lot G was subdivided in 1976, Marcelino already occupied the disputed portion and even then co-
ownership did not apply over the disputed lot. Elementary is the rule that there is no co-ownership
For August 18, 2017 where the portion owned is concretely determined and identifiable, though not
technically described, 45 or that said portion is still embraced in one and the same certificate of title does
make said portion less determinable or identifiable, or distinguishable, one from the other, nor that
dominion over each portion less exclusive, in their respective owners.
Thus, since Marcelino built a house and has been occupying the disputed portion since 1949, with the
consent of his father and knowledge of the co-heirs, 47 it would have been just and equitable to have
segregated said portion in his favor and not one adjacent to it. Undoubtedly, the subdivision survey
eected in 1976 spawned the dilemma in the present case. It designated Lot G-1 as Marcelino's share
in the inheritance notwithstanding his possession since 1949 of a definite portion of Lot G, now the
southernmost portion of Lot 1-E.
Marcelino raised the defense of acquisitive prescription, in addition to possession in good faith, in his
Answer to the Complaint in the MTC. Prescription, in general, is a mode of acquiring or losing ownership
and other real rights through the lapse of time in the manner and under conditions laid down by law,
namely, that the possession should be in the concept of an owner, public, peaceful, uninterrupted and
adverse. 48 Acquisitive prescription is either ordinary or extraordinary. 49 Ordinary acquisitive
prescription requires possession in good faith and with just title 50 for ten years. 51 In extraordinary
prescription ownership and other real rights over immovable property are acquired through uninterrupted
adverse possession thereof for thirty years, without need of title or of good faith.
In the present case, the evidence presented during the trial proceedings in the MTC were sorely
insucient to prove that acquisitive prescription has set in with regards to the disputed lot. The tax
declaration 53 and receipts 54 presented in evidence factually established only that Marcelino had been
religiously paying realty taxes on Lot G-1. Tax declarations and receipts can only be the basis of a claim
of ownership through prescription when coupled with proof of actual possession. 55 Evidently, Marcelino
declared and paid realty taxes on property which he did not actually possess as he took possession of a
lot eventually identified as the southernmost portion of Lot 1-E of subdivision plan (LRC) Psd-307100.
Furthermore, the Court notes that Marcelino no longer invoked prescription in his pleadings before the
RTC 56 and CA; 57 neither did herein petitioners raise prescription in their petition 58 and memorandum
59 before this Court. They only extensively discussed the
!38 of 105!
defense of possession in good faith. They are thus deemed to have abandoned the defense of
prescription.
The Court shall now delve on the applicability of the principle of possession in good faith.
It has been said that good faith is always presumed, and upon him who alleges bad faith on the part of
the possessor rests the burden of proof. 60 Good faith is an intangible and abstract quality with no
technical meaning or statutory definition, and it encompasses, among other things, an honest belief, the
absence of malice and the absence of design to defraud or to seek an unconscionable advantage. An
individual's personal good faith is a concept of his own mind and, therefore, may not conclusively be
determined by his protestations alone. It implies honesty of intention, and freedom from knowledge of
circumstances which ought to put the holder upon inquiry. 61 The essence of good faith lies in an honest
belief in the validity of one's right, ignorance of a superior claim, and absence of intention to overreach
another. 62 Applied to possession, one is considered in good faith if he is not aware that there exists in
his title or mode of acquisition any flaw which invalidates it.
In the present case, Marcelino's possession of the disputed lot was based on a mistaken belief that Lot
G-1 is the same lot on which he has built his house with the consent of his father. There is no evidence,
other than bare allegation, that Marcelino was aware that he intruded on respondents' property when he
continued to occupy and possess the disputed lot after partition was eected in 1976.
Moreover, the fact that in 1977 Marcelino mortgaged Lot G-1 subject of TCT No. 22656 is not an indication
of bad faith since there is no concrete evidence that he was aware at that time that the property covered
by the title and the one he was occupying were not the same. There is also no evidence that he introduced
improvements on Lot G-1. In fact, the agreement on March 1, 1989 to a resurvey and swapping of lots
for the purpose of reconstructing the land titles is substantial proof of Marcelino's good faith, sincerity of
purpose and lack of intention to hold on to two lots.
Thus, the CA's conclusion that Marcelino intended to hold on to both the disputed lot and Lot G-1 is pure
speculation, palpably unsupported by the evidence on record. Marcelino is deemed a builder in good faith
64 at least until the time he was informed by respondents of his encroachment on their property.
For August 18, 2017
When a person builds in good faith on the land of another, the applicable provision is Article 448, which
reads:
Article 448. The owner of the land on which anything has been built, sown or planted in good faith, shall
have the right to appropriate as his own the works, sowing or planting, after payment of the indemnity
provided for in Articles 546 66 and 548, 67 or to oblige the one who built or planted to pay the price of
the land, and the one who sowed, the proper rent. However, the builder or planter cannot be obliged to
buy the land if its value is considerably more than that of the building or trees. In such case, he shall pay
reasonable rent, if the owner of the land does not choose to appropriate the building or trees after proper
indemnity. The parties shall agree upon the terms of the lease and in case of disagreement, the court
shall fix the terms thereof.
Thus, the owner of the land on which anything has been built, sown or planted in good faith shall have
the right to appropriate as his own the building, planting or sowing, after payment to the builder, planter
or sower of the necessary and useful expenses, and in the proper case, expenses for pure luxury or mere
pleasure. The owner of the land may also oblige the builder, planter or sower to purchase and pay the
price of the land. If the owner chooses to sell his land, the builder, planter or sower must purchase the
land, otherwise the owner may remove the improvements thereon. The builder, planter or sower,
however, is not obliged to purchase the land if its value is considerably more than the building, planting
or sowing. In such case, the builder, planter or sower must pay rent to the owner of the land. If the parties
cannot come to terms over the conditions of the lease, the court must fix the terms thereof. The right to
choose between appropriating the improvement or selling the land on which the improvement stands to
the builder, planter or sower, is given to the owner of the land.
In accordance with Depra v. Dumlao, 69 this case must be remanded to the trial court to determine
matters necessary for the proper application of Article 448 in relation to Articles 546 and 548. Such
matters include the option that respondents would take and the amount of indemnity that they would pay,
should they decide to appropriate the improvements on the lots.
The Court notes that petitioners' alternative prayer that swapping of lots be ordered because no
improvements have been introduced on Lot G-1. This cannot be granted. Respondents and Marcelino,
petitioners' predecessor-in-interest, did not pray for swapping of lots in all their pleadings below. Both
parties also did not allege the existence of a swapping agreement in
!39 of 105!
their initial pleadings, much less pursue the enforcement of the swapping agreement. They are deemed
to have renounced or abandoned any enforceable right they had under the swapping agreement and the
parties cannot be compelled to a swapping of lots.
WHEREFORE, the instant petition is GRANTED. The assailed Decision and Resolution of the Court of
Appeals in CA-G.R. SP No. 64729 are REVERSED and SET ASIDE. The case is REMANDED to the
court of origin for further proceedings to determine the facts essential to the proper application of Article
448 in relation to Articles 546 and 548 of the Civil Code.
No pronouncement as to costs.
SO ORDERED.
Panganiban, C.J., Ynares-Santiago, Callejo, Sr. and Chico-Nazario, JJ., concur.
FIRST DIVISION
[G.R. No. L-31267. November 24, 1972.] IGNACIO NEGRETE, plainti-appellant, vs. COURT
OF FIRST INSTANCE OF MARINDUQUE and IGMEDIO MADERAZO, represented by his legal
representative CATALINO MADERAZO, defendants-appellees.
Jose L. Desnarro, Jr. for plainti-appellant. Restituto J. Opis for defendants-appellants.
DECISION
MAKASIAR, J p:
Plainti-appellant Ignacia Negrete, an indigent widow over 70 years of age, appealed as a pauper from
the decision of the Court of First Instance of Marinduque dated May 22, 1969 raising only questions of
law (Annex "A", p. 6, rec.).
Claiming that since 1945 she and her late husband had been in continuous and peaceful possession of
a parcel of land with an area of nine (9) hectares more or less in sitio Puting Buhangin, Mogpog,
Marinduque (near the Marcopper Mines p. 8, rec.) and covered by Tax Declaration No. 8431 in her
name, plainti-appellant Ignacia Negrete filed on July 28, 1956 a forcible entry suit against the defendant-
appellee Igmedio Maderazo in the municipal court of Mogpog (docketed as Civil Case No. 51), alleging
among others that on January 7, 1956, said defendant-appellee, through strategy, force, intimidation,
and stealth unlawfully entered the northern portion of said parcel of land, said northern portion comprising
an area of about four hectares. Defendant-appellee orally moved to dismiss the ejectment complaint on
the grounds of lack
For August 18, 2017 of cause of action and improper venue, which motion to dismiss was denied by the
court for lack of merit. Thereafter, defendant -appellee filed an answer asserting among others that the
land he is presently cultivating in sitio Puting Buhangin is a dierent land. To expedite the proceedings,
the municipal court directed the chief of police of Mogpog to conduct an ocular inspection of the disputed
land to determine whether the land area cultivated by the defendant-appellee is the same land claimed
by the plainti-appellant as the northern portion of her land under Tax Declaration No. 8431.
After the trial, the municipal court rendered a decision dated September 15, 1956 in favor of defendant-
appellee after finding that:
"There is no dispute as to the identity of the land alleged to have been unlawfully entered by the
defendant. Despite the allegations of the defendant that the land he is presently cultivating is a dierent
land from that claimed by the plaintis as the northern portion of the property, the ocular inspection made
by the Chief of Police showed that it is the same land as shown by Exhibit 'A' (also Exhibit '1') and verified
by the parties during their oral testimony (at) the witness stand. The only question to be resolved now is:
Did the defendant through force, strategy and stealth, unlawfully enter(ed) this land on January 7, 1956,
thereby depriving the plaintis of its lawful possession? "Plaintis' testimony both oral and documentary,
is to the eect that they have been in continuous and peaceful possession of the whole parcel of land
under Tax Dec, No. 8431 (which included the four hectares in dispute) since 1945, exercising acts of
possession (clearing the land and planting rice therein) until January 7, 1956, when defendant unlawfully
entered the land and began cultivating it.
"Defendant on the other hand does not deny cultivating the land in the month of January, 1956, but he
testified that he had been continuously cultivating the same land since 1951 when he bought certain
portions of it and possessed the other portions as tenant of his brothers and sister-in-law.
"After considering all the evidence presented and the manner the witnesses testified on the witness stand,
the Court is of the opinion and so holds that the preponderance of evidence is with the defendant that he
had been in continuous and peaceful possession of the disputed land since 1951 and that, therefore, he
was in the material and physical possession of the said land within the year prior to the filing of the instant
complaint. The testimony of the defendant and his witness (Cresencia Oriendo) is more coherent,
straightforward and clear. It may be that, as the
!40 of 105!
plaintis claim, they have a strong and valid claim to the possession of the disputed portion as part of the
whole parcel under Tax Dec. No. 8431 over which they allege possession incident to ownership, but then,
the only issue in the instant case is possession de facto (possession for one year prior to the institution
of the action) and not possession de jure incident to ownership. Defendant, Igmedio Maderazo, having
proved by preponderance of evidence that he was in the material and physical possession of the land for
more than one year immediately preceding the filing of the action on July 28, 1956, he has now the
security that entitles him to stay in the property until he is lawfully ejected by a person having a better
right by either accion publiciana or accion reivindicatoria. (Moran, Vol. II, pages 238-239, citing Masallo
vs. Cesar, 39 Phil. 134, and other cases).
"IN VIEW OF THE FOREGOING, this Court finds that the defendant has not unlawfully entered the land
in dispute on January 7, 1956 as alleged by the plaintis, he being in the material and physical possession
of the said land prior to the date of the incident.
"WHEREFORE, this Court renders judgment in favor of the defendant and against the plaintis with costs
against the plaintis." (Pp. 43-44, rec.).
Instead of appealing from the aforesaid decision of the municipal court of Mogpog, plainti-appellant filed
on January 18, 1967 after the lapse of ten (10) years an action for recovery of ownership of property
(reivindicacion) against defendant-appellee Igmedio Maderazo alleging that she is the owner of a piece
of land of about nine (9) hectares situated in barrio Puting Buhangin, Mogpog, Marinduque covered by
Tax Declaration No. 8645 (annexed to the complaint as Exhibit "A"), having inherited the same from her
late father Juan Negrete who was 150 years old when he died a year before the outbreak of World War
II; that she and her predecessor-in-interest have been in possession of the same for about seventy (70)
years; that shortly after liberation, defendant- appellee, claiming to be the owner thereof, entered the said
land by means of force, intimidation, stealth and strategy and introduced improvements thereon
consisting of about "100 coco trees and 28 boxes of rice paddies"; that until 1957 she repeatedly
prohibited defendant-appellee from making any improvement thereon, but defendant - appellee
threatened her and her representatives with bodily harm; and that she suered damages in the amount
of P6,000.00, by virtue of which she prayed for judgment declaring her to be the lawful owner of the land
and for damages in the amount of P6,000.00 as well as costs (Annex "A", pp. 26-28, rec.).
For August 18, 2017
In his answer dated April 11, 1967, defendant-appellee averred that since liberation, he had been in
possession of the northern portion of the questioned parcel of land and cultivated and introduced
improvements on the same consisting of coconut trees and "boxes of rice paddies"; that, asserting
ownership over the said northern portion and prohibiting anyone from cultivating the same, he specifically
denies threatening the plainti or anyone else with physical harm; that he bought for P150,00 on August
30, 1954 the northern portion of about 3,5700 square meters (Exhibit "A" states "the southern half (1/2)
portion") which is now covered by tax declaration No. 25811 in his name from Tito Oriendo, who declared
it for taxation in 1949 under tax declaration No. 16117; and that his possession over the northern portion
of the disputed land had never been disturbed until July 28, 1956, when plainti-appellant instituted a
civil suit against him for forcible entry in the municipal court of Mogpog, which decided the same in his
favor on September 15, 1956, from which decision plainti-appellant did not appeal; and interposes as
special defenses that plainti-appellant has no legal capacity to sue, that the action had been barred by
the statute of limitation for plainti-appellant filed this present action over ten (10) years after he
purchased the property, and the cause of action is barred by prior judgment, as well as a counterclaim
(pp. 29-32, rec.).
The disputed land of about nine (9) hectares is described in tax declaration Nos. 8431 (p. 43, rec.; p. 1,
mun. court decision) and 8645 in the name of plainti-appellant as situated in barrio Puting Buhangin,
Mogpog, Marinduque, and bounded thus: "North, Benito Luisaga and Pantaleon Oriendo; East, Toribio
Linga, Eustaquio Logmao, Hilarion Buag and B. Linga; South, Boac River, Modesto Lazo and Tomas
Malimata, and West, Benito Luisa-Naza-rio Malimata, Pedro Luisaga and Hilarion Buag" (p. 26, rec.).
The deed of sale, executed and signed by Tito Oriendo as vendor and defendant-appellee Igmedio
Maderazo as vendee, was notarized on August 30, 1954 by the municipal judge of Boac and stipulates:
"This DEED, made and executed by and between EGMIDIO MADERAZO, 48 years of age, a citizen of
the Philippines, married (to) Cresenciana Oriendo with residence and postal address at Bo. Puting
Buhangin, Boac, Marinduque, now and hereafter referred to all the VENDEE, and TITO ORIENDO, 55
years of age, married to Bonifacia Lazo, with residence and postal address at Bo Dinapulan, Boac,
Marinduque, now and hereafter referred to all the VENDOR.
"W I T N E S S E T H
!41 of 105!
"That for and in consideration of the sum of ONE HUNDRED FIFTY PESOS (P150,00), Philippine
Currency, the receipt whereof hereby acknowledged to the entire satisfaction of the VENDOR, the said
VENDOR does hereby, by this presents, SELL, TRANSFER, CONVEY, in a manner absolute and
irrevocable, unto the VENDEE, his heirs and assigns, ONE-HALF (PRO-INDIVISO) SHARE of that
certain real estate destined for agricultural purposes, heretofore under the actual possession and
management of the VENDOR, which one-half share is more particularly bounded and described as follow:
"The southern HALF (1/2) PORTION containing approximately 3700 square meters without any
improvements thereon of that parcel of coconut-forest land situated in barrio Puyog, Boac, Marinduque,
and which ONE-HALF SHARE is to be bounded on the North; by rest of the land; East: Sofia Oriendo;
South: Pedro Oriendo; and West: Estero, delimited by madre cacao trees.
"That the VENDOR does hereby declare that the entire parcel is assessed in the year 1949 at P30.00 as
per tax decl. 16117 in the name of the herein VENDOR; and that the parties hereto have agreed to record
this instrument under Act 3344, the property involved not having been previously registered either under
Act 496 or under the Spanish Mortgage Law;
"That the VENDOR does hereby covenant and agree with the VENDEE, his heirs and assigns, that he is
lawfully seized in fee simple of the said one-half premises; that he has perfect right to convey the subject
property, having adverse, physical and continuous possession and management over the same for more
than 15 years; that it is free from all liens and encumbrances; and that he will warrant forever defend the
title herein conveyed against the lawful claims of all persons whomsoever." (Exh. "A" or Annex "C", p. 33,
rec.).
On October 17, 1968, defendant-appellee Igmedio Maderazo died and was substituted on January 4,
1969 by his legal representative, Catalino Maderazo (p. 35, rec.; p. 2, CFI decision).
In a decision dated May 22, 1969, the Court of First Instance of Marinduque rendered the following
decision dismissing the case, thus:
". . . On January 21, 1969, the Court gave the parties time to file their respective memoranda after the
parties agreed to submit the case for judgment based on their pleadings. The only issue here to be
resolved is whether or not the cause of action is barred by the statute of limitation and whether or not the
plainti is
For August 18, 2017 guilty of laches for not having instituted her action within 10 years from the date the
defendant acquired the property by deed of sale.
"From the pleadings, the following facts are clear, to wit: that the land in question described in the
complaint was bought by Igmidio Maderazo (deceased), the original defendant and later substituted by
his son, the present defendant, from one Tito Oriendo by virtue of a Deed of Sale, marked as Exhibit "A",
(page 110 of the Expediente). Said parcel of land was purchased by the defendant on August 30, 1954
(Exhibit ("A"). The plainti contends that the deed of sale (Exhibit "1", for the plainti and Exhibit "A", for
the defendant) is void ab initio because it lacked the formalities required by law, and that the possession
of the defendant by virtue of the sale made him (defendant) a mere trustee and therefore neither
prescription nor laches may be set up as a defense by him.
"The contention of the plainti that the deed of sale is void lacks basis in law and fact. Said deed of sale
was notarized by a Justice of the Peace (now Municipal Judge) and it is evident that all the essential
elements of a contract are present, namely: (1) consent of the contracting parties (2) object certain which
is the subject matter of the contract and (3) cause of the obligation which is established (Act 1318 New
Civil Code). The deed of sale between Tito Oriendo and the father of the present defendant being a
perfect deed of sale, the Court cannot agree to the allegation of the plainti that the defendant became
a mere trustee by virtue of the deed of sale.
"There is no dispute as to the identity of the land subject-matter of the instant suit. There was an ocular
inspection made by the Chief of Police of Mogpog when the same land was litigated there. Moreover, the
present defendant (and his father who bought the land in 1954) has been in possession of the land since
1954 and therefore even if there was a flaw in their title, the defendant would still have acquired the land
by virtue of acquisitive prescription, having possessed the land in good faith within a period of ten (10)
years. There is good faith because the defendant's possession of the land is by virtue of a deed of sale."
(pp. 35-36, rec.).
Plainti-appellant in her brief maintains that the lower court erred:
(1) in not declaring that the deed of sale executed on August 30, 1954 by Tito Oriendo in favor of
defendant-appellee Igmedio Maderazo refers to a dierent parcel of land situated in barrio Puyog,
municipality of Boac, Marinduque, while the disputed parcel is situated in barrio Puting Buhangin,
Mogpog, Marinduque;
42! of 105!
(2) in admitting the said deed of sale as evidence of defendant-appellee's title and possession in
good faith of the land in question; and
(3) in holding that defendant-appellee acquired the land through ordinary acquisitive prescription
by virtue of his possession in good faith for the period of ten (10) years, and in not declaring that
defendant-appellee's possession was interrupted by the forcible entry suit she instituted on July 28, 1956
in the municipal court of Mogpog.
Plainti-appellant argues that the deed of sale in favor of defendant-appellee clearly describes the land
as the "southern Half (1/2) portion containing approximately 3,700 square meters . . . situated in Barrio
Puyog, Boac, Marinduque," and that this parcel is about 3 kilometers from the poblacion of Boac (p. 10,
rec.), while the parcel of land in question is situated in sitio Puting Buhangin, municipality of Mogpog, far
from the parcel of land sold to Igmedio Maderazo. Defendant-appellee could not therefore assert good
faith in possessing the disputed lot; consequently, adverse possession of ten (10) years would not suce.
I
The applicable statute on prescription of action for the recovery of a real property, is Article 1141 of the
Civil Code of the Philippines, which provides that "real actions over immovables prescribe after thirty
years . . .
without prejudice to what is established for the acquisition of ownership and other real rights by
prescription.

The trial court found that defendant-appellee Catalino Maderazo (together with his late father, Igmedio
Maderazo) has been in possession of the land since 1954 (p. 36, rec.), which factual determination is not
impugned by the parties. The institution by plainti-appellant of the action for recovery of ownership of
the land in question on January 18, 1967, after only about 13 years from 1954, interrupted the running of
the prescriptive period of thirty (30) years (Art. 1155, Civil Code of the Philippines). The action was
therefore filed well within the period prescribed in Article 1141.
II
However, defendant-appellee Catalino Maderazo insists that he has acquired ownership over the
disputed parcel by ordinary prescription through adverse possession of only ten (10) years under Article
1134 of the Civil Code of the Philippines. But ordinary acquisitive prescription of immovables and other
real rights thru adverse possession of ten (10) years, requires possession "in good faith and with just title
for the time fixed by law" (Art. 1117, Civil Code of the Philippines).
For August 18, 2017
In the absence of a just title or good faith, ownership of immovables can be acquired by extraordinary
prescription thru an uninterrupted adverse possession of thirty (30) years (Art. 1137, Civil Code of the
Philippines).
After finding that defendant-appellee Catalino Maderazo "has been in possession of the land since 1954,"
the trial judge concluded that "even if there was a flaw in their title, the defendant would still have acquired
the land by virtue of acquisitive prescription, having possessed the land in good faith within a period of
ten (10) years. There is good faith because the defendant's possession of the land is by virtue of a deed
of sale" (p. 36, rec.).
The crucial issue therefore is whether the deed of sale executed by Tito Oriendo on August 30,1954 in
favor of the late Igmedio Maderazo could be considered as a valid basis for good faith and as a just title,
in order to justify the acquisition of the disputed parcel of about 9 hectares by ordinary prescription thru
adverse possession of only 10 years.
The law defines a possessor in good faith as one who is not aware of any flaw in his title or mode of
acquisition; and conversely, one who is aware of such a flaw is a possessor in bad faith (Art. 526, Civil
Code of the Philippines).
WE ruled that "the essence of the bona fides or good faith, therefore, lies in honest belief in the validity
of one's right, ignorance of a superior claim, and absence of intention to overreach another." 1
A deed of sale, to constitute a just title and to generate good faith for the ordinary acquisitive prescription
of ten (10) years, should refer to the same parcel of land, which is adversely possessed. In the case at
bar, the deed of sale in favor of the deceased Igmedio Maderazo covers a parcel of land patently dierent
from the disputed land owned by plainti-appellant as to area, location and boundary owners.
The disputed parcel contains an area of about nine (9) hectares, and is situated in sitio Puting Buhangin,
Mogpog, Marinduque, as shown in Tax Declaration No. 8431 submitted as evidence by plainti-appellant
at the trial of the ejectment case before the municipal court of Mogpog (see Decision of municipal court,
p. 43, rec.) and in Tax Declaration No. 8645 attached as Annex "A" to the complaint in Civil Case No
1395 for reivindicacion before the Court of First Instance of Marinduque (p. 26, rec.). Said Tax Declaration
Nos. 8431 and 8645 particularly describe the questioned parcel of land as bounded on the north by Benito
Luisaga and Pantaleon Oriendo; east, by Toribio
!43 of 105!
Orlinga, Eustaquio Logmao, Hilarion Buag and B. Linga; south, by Boac river, Modesto Lazo and Tomas
Malimata; and west, Benito Luisa-Nazario Malimata, Pedro Luisaga and Bilarion Buag (p. 26, rec.). This
9-hectare land is near the Marcopper Mines (p. 8, rec.) and therefore of great potential value.
On the other hand, the parcel of land purchased on August 30, 1954 by the late Igmedio Maderazo from
Tito Oriendo for P150 was assessed in 1949 at P30 per Tax Declaration No. 16117 and is described in
the deed of sale, Exhibit "A", as "the southern HALF (1/2) PORTION containing approximately 3,700
square meters without any improvements thereon of that parcel of coconut-forest land situated in barrio
Puyog, Boac, Marinduque, and which ONE-HALF SHARE is to be bounded on the north: by the rest of
the lot; east: Sofia Oriendo; south: Pedro Oriendo; and west: estero, delimited by madre cacao trees" (p.
33, rec.). If the southern half is only about 3,700 square meters, the northern half must also be about
3,700 square meters, or the entire lot of Tito Oriendo is only about 7,400 square meters in area very
much less than nine (9) hectares, the area of the questioned parcel.
It is therefore patent that the land sold by Tito Oriendo to the late Igmedio Maderazo is distinct from the
land of plainti-appellant Ignacia Negrete as to location, boundaries and area. To repeat, the land of
plainti-appellant is about nine (9) hectares and located in sitio Puting Buhangin, Mogpog. The lot of
defendant-appellee is only about 3,700 square meters and situated in barrio Puyog, Boac. The two
parcels have dierent boundary owners. As a matter of fact, defendant-appellee did not controvert the
claim of plainti-appellant that barrio Puyog is three kilometers from the town proper of Boac, Marinduque
(pp. 15-16, rec., or pp. 9-10, appellant's brief). Defendant-appellee does not even insinuate that barrio
Puting Buhangin of Mogpog is adjacent to barrio Puyog of Boac. Furthermore, defendant-appellee, in
paragraph 2 of his answer to the complaint for recovery of ownership, admits that plainti-appellant "owns
a piece of land at Puting Buhangin, Mogpog, Marinduque" (p. 29, rec.).
The municipal court of Mogpog found that the disputed parcel of about nine (9) hectares is within the
town of Mogpog. Defendant-appellee Igmedio Maderazo himself conceded before the municipal court of
Mogpog that the land he is cultivating, which is subject matter of the forcible entry suit, is in Puting
Buhangin; although he alleges that it is dierent from the land claimed by the plainti-appellant (p. 43,
rec.).
Defendant-appellee included in his brief an alleged report dated February 12, 1968 and purportedly
signed by commissioners Constancio M. Marte allegedly
For August 18, 2017 representing the court, Teodoro Lagustin allegedly representing the plainti and
Igmedio Maderazo allegedly for himself, stating that on their ocular inspection of the questioned land on
February 12, 1968, they"found out that the attached Sketch is the land in questioned as the plainti
declared in the person of Miguel Malapit; and on the other hand the defendant and at the same time
commissioner Igmedio Maderazo declared that the names stated in the said sketch are the persons in
possession of each parcel with the approximate area of each.
"The commissioner also found out that the land in question is within the jurisdiction of Boac, Marinduque,
February 12, 1968.
"Mogpog, Marinduque, February 12, 1968. "(SGD.) CONSTANCIO M. MARTE
Commissioner of the Court
"TEODORO LAGUSTIN
Commissioner for the Plainti
"(SGD.) IGMIDIO MADERAZO
Commissioner for Defendant

As above reproduced, the said report appears to have been signed by only two commissioners, namely,
Constancio Marte and Igmedio Maderazo. It was not signed by Teodoro Lagustin, the alleged
commissioner of the plainti. Moreover, the alleged report states that Miguel Malapit represented the
plainti. Yet in the spaces for the signatures of the commissioners, the name Teodoro Lagustin, not
Miguel Malapit, appears as commissioner for the plainti. It would seem therefore that Teodoro Lagustin
or Miguel Malapit did not agree to the entire report including its last paragraph stating that the land in
question is within the jurisdiction of Boac, Marinduque, for which reason they did not sign the same. And
precisely because neither Miguel Malapit nor Teodoro Lagustin, as commissioner for the plainti, signed
the aforesaid alleged report, it was not submitted to the lower court, so that the trial court in its decision
did not even remotely intimate about, much less approve, said alleged report. Said report was prepared
obviously to sustain the position of defendant-appellee.
Hence, defendant-appellee Catalino Maderazo, along with his late father Igmedio Maderazo, could not
claim good faith in occupying said land of plainti-appellant on the basis of the said instrument of sale. If
said appellee's position were to be sustained, it would be easy for anyone to acquire ownership of an
untitled land belonging to another person by adverse possession of only ten (10) years on the basis of a
document of sale covering a distinct parcel executed
!44 of 105!
by a person who is a stranger to the land. This could not have been intended by the legislature; because
forged deeds of conveyance could be conveniently interposed to oust the true owner from a land by
adverse possession of only ten (10) years. To spawn such a monstrosity in the law was never
contemplated by the statute, which is designed to engender social quietude.
Appellee Maderazo admits in his answer in Civil Case No. 1395 that he is a resident of barrio Puting
Buhangin, Mogpog, Marinduque (pp. 26, 29, rec.). As the buyer, he knew what lot was sold to him. And
having signed as vendee the deed of sale in his favor, he is conclusively presumed to have read the deed
of sale, which clearly states that the southern half (1/2) portion containing an area of approximately 3,700
square meters, was the parcel he acquired from his vendor Tito Oriendo, which is located in barrio Puyog,
Boac, Marinduque. Appellee Maderazo therefore was aware and knew that the land sold to him is situated
in barrio Puyog, Boac, and is only about 3,700 square meters (less than half a hectare in area, not the
land of about nine (9) hectares in barrio Puting Buhangin, Mogpog belonging to the plainti-appellant.
Defendant-appellee Catalino Maderazo cannot in good conscience assert honest belief in the validity of
his right nor absence of intention to overreach another in view of the facts and circumstances aforestated.
Moreover, there is no intimation in the record that vendor Tito Oriendo testified either in the forcible entry
case before the municipal court of Mogpog or in the reivindicatory action before the Court of First Instance
of Marinduque that he owned a parcel of land situated in Puting Buhangin, Mogpog, Marinduque, or that
the land he sold to the defendant-appellee is in sitio Puting Buhangin, Mogpog, Marinduque. Defendant-
appellee did not even submit any tax declaration or tax receipts in the name of his alleged vendor, Tito
Oriendo, covering the disputed parcel of land of about nine (9) hectares.
The case of Ortiz vs. Fuentebella is hardly applicable to the case at bar because of the following facts
established therein:
(1) Asuncion Fuentebella purchased, by means of a public instrument, a tract of land including a pasture
land from Juan and Sotera Cano, who believed that the disputed pasture land sold by them was included
in the land they inherited from their father Felipe Cano, and which they sold to Asuncion. As a
consequence, Asuncion Fuentebella took possession of said pasture land, built a house and introduced
other improvements thereon. The pasture land turned out to have a duly inscribed possessory information
title in the name of
For August 18, 2017
Ramon Ortiz, father of Marcelina Ortiz, who in March, 1909, informed Asuncion by letter that her father
Ramon Ortiz owns the said pasture land and requested Asuncion to desist from further introducing
improvements thereon.
(2) It was established that Juan and Sotera as well as their father Felipe Cano possessed the land "in the
neighborhood" of the disputed pasture land.
Consequently, the Supreme Court therein ruled:
"However it be, we do not regard as decisive the evidence presented to prove that the defendant's
possession was in bad faith. The nullity of the greater part of her title is not sucient argument to prove
that she knew of the defect in her mode of acquisition of a tract of land as belonging to Juan and Sotera
Cano, when it is now demonstrated in this case that neither Sotera, nor Juan Cano, nor even their father
Felipe Cano, had at any time possessed it, but another tract in the neighborhood, possession whereof
might easily have caused error on the part of the purchaser. Defendant's bad faith began after the warning
given in a letter by the plainti's daughter in March, 1909, for after having received it she then had ground
to doubt that Sotera, and Juan Cano could transfer any title of possession in the following December."
In the case at bar, unlike Juan and Sotera Cano, there is no showing that Tito Oriendo erroneously
believed in good faith that the disputed parcel of land of about nine (9) hectares belonging to the plainti-
appellant is included in the deed of sale executed by him in favor of Igmedio Maderazo which sale covers
only an area of 3,700 square meters, less than half a hectare. As repeatedly emphasized heretofore, Tito
Oriendo could not possibly entertain such belief, considering the dierence in boundaries, location and
area between the parcel of land of about nine (9) hectares of plainti-appellant and the lot of about 3,700
square meters sold to defendant-appellee under Exhibit "A". Then again, it is not shown that the nine
hectare parcel of plainti-appellant is adjacent to the lot sold by Tito Oriendo to defendant-appellee
Igmedio Maderazo. On the contrary, the claim of plainti-appellant that her nine-hectare parcel of land is
within the municipality of Mogpog and not within the municipality of Boac, remains uncontroverted and is
confirmed by her tax declaration Nos. 8431 and 8645 and by the decision of the municipal court of
Mogpog in the forcible entry case as well as in the appealed decision of the Court of First Instance of the
Marinduque (pp. 36, 43, rec.).
Hence, not being a possessor in good faith, defendant-appellee Catalino Maderazo can acquire
ownership over the disputed parcel of land of about nine (9)
!45 of 105!
hectares belonging to plainti-appellant only by extraordinary acquisitive prescription thru an
uninterrupted adverse possession of thirty (30) years (Art 1137, Civil Code of the Philippines). Since he
occupied the same for only about thirteen (13) years from 1954 until 1967, when his adverse possession
was interrupted by the filing of the action for reivindicacion on January 18, 1967 (Art. 1155, Civil Code of
the Philippines), the claim of defendant-appellee is untenable.
WHEREFORE, JUDGMENT IS HEREBY RENDERED.
(1) REVERSING THE APPEALED DECISION,
(2) DECLARING PLAINTIFF-APPELLANT IGNACIA NEGRETE AS OWNER OF THE LAND OF
ABOUT NINE
(9) HECTARES DESCRIBED IN HER COMPLAINT, AND
(3) DIRECTING DEFENDANT-APPELLEE CATALINO MADERAZO TO DELIVER TO SAID
PLAINTIFF-APPELLANT THE POSSESSION OF AFORESAID LAND, TO VACATE THE SAME AND
TO PAY THE COSTS.
So ordered.
EN BANC
[G.R. No. L-23509. June 23, 1966.]
NATY BALTAZAR, ET AL., plaintis-appellees, vs. SILVINA CARIDAD, ET AL., defendants-appellants.
Guillermo, M. Pasion and for plaintis-appellees.
Castro Raval for defendants-appellants.
DECISION
REYES, J.B.L., J p:
Appeal against an order, issued by the Court of First Instance of Ilocos Norte, in its Cadastral Case No.
54, GLRO Cad. Case No. 1222, compelling respondents Silvina Caridad and Eduarda Caridad to remove
their respective houses built on the southern portion of Lot No. 8864 within thirty days from receipt of said
order. Respondents originally interposed the present appeal to the Court of Appeals, where it was
docketed as its CA-G. R. No. 31289-R. The appellate court, however, certified the appeal to this Court
for raising only questions of law.
The facts are not in dispute, and are as follows:
In the cadastral proceeding above stated, the trial court rendered decision, dated January 23, 1941,
awarding said Lot No. 8864 of the Laoag (Ilocos Norte) cadastre to the spouses Julio Baltazar and
Constancia Valencia as their conjugal partnership property. Said decision
For August 18, 2017 having become final, the corresponding decree was issued on July 12, 1941, and
pursuant thereto, said lot was registered in the names of applicant spouses under Original Certificate of
Title No. O- 1445, which was later transcribed, on November 5, 1959, in the oce of the Register of
Deeds of Ilocos Norte.
In the meanwhile, Julio Baltazar, the registered owner of said Lot No. 8864, died. On December 6, 1961,
his surviving wife and children, as petitioners, filed a motion, in the cadastral case praying for writ of
possession against respondents Silvina Caridad and her daughter, Eduarda Caridad, who had been in
possession of the southern portion of said Lot No. 8864 since 1939, while the cadastral case involving
said lot was pending before the trial court, and before the decision was rendered and the corresponding
decree issued in 1941.
No writ having theretofore been issued in petitioners' favor, the trial court issued an order, on December
11, 1961, granting petitioners' motion, and overruled respondents' opposition but directed the sheri not
to remove or destroy the permanent improvements on the lot without an express command. On January
2, 1962, the order having become final, the sheri enforced the writ and placed petitioners in possession
of the southern portion of the lot.
On January 23, 1962, petitioners presented a motion to compel respondents Eduarda Caridad and her
mother, Silvina Caridad, to remove their respective houses which they built in 1958 and 1959,
respectively, in the southern portion of the disputed lot, and, in the event of their failure to do so, to order
the sheri to demolish the same. Respondents again opposed said motion.
On March 20, 1962, the trial court, after due hearing, granted petitioners' motion, ordering respondents
to remove their respective houses from the southern portion of said lot No. 8864 within thirty days from
receipt of said order. Not satisfied, respondents appealed.
Respondents-appellants question the power or jurisdiction of the trial court, sitting as a cadastral court,
to order the removal of their respective houses which were built in the disputed lot long after the issuance
of the final decree of registration. They insist that they are builders in good faith of the houses in question,
and, as such, they are accorded rights under Article 448 of the new Civil Code, which rights cause a
conflict to arise between petitioners, as registered owners, on the one hand, and respondents, as builders
in good faith, on the other; that this conflict is a new matter which the cadastral court could not have
possibly passed upon in 1941 when it rendered its decision awarding the
!46 of 105!
disputed lot to Julio Baltazar, the predecessor-in-interest of petitioners. Respondents also insist that the
determination or settlement of this controversy is cognizable only by a court exercising general
jurisdiction, and that the only remedy available to petitioners is to file an ordinary action for ejectment or
recovery of possession against them. Respondents further urged that this remedy is rendered
unnecessary in view of the pendency of an action for reconveyance over the disputed portion of said lot
No. 8864, which respondents filed against petitioners in the same court and docketed (but after the writ
of possession had been asked) as its Civil Case No. 3451, and wherein the respective rights, interests
and title of the parties will ultimately be ventilated.
The above contentions of respondents are without merit. It is to be noted that respondents do not dispute
that during the pendency of the cadastral proceeding, rendition of the judgment awarding said lot No.
8864, and consequent issuance of the final decree of registration of the same in favor of Julio Baltazar,
the late Andres Caridad, his surviving spouse, respondent Silvina Caridad, and their children, one of
whom is respondent Eduarda Caridad, were in possession of the southern portion of the disputed lot;
and that respondent Eduarda Caridad claims right and title thereto as a mere heir and successor-in-
interest of said Andres Caridad. Neither do respondents dispute the propriety and validity of the order of
the cadastral court, granting the writ of possession in favor of petitioners as well as its enforcement.
Under these circumstances, we hold that the order, dated March 20, 1962, of the cadastral court, granting
petitioners' motion to compel respondents to remove their respective houses from the disputed lot, is
valid and enforceable against respondents. In the case of Marcelo vs. Mencias, etc., et al., L-15609, April
29, 1960, 58 O. Gaz., 3349, this Court had already upheld the jurisdiction or authority of the court of
first instance, sitting as a land registration court, to order, as a consequence of the writ of possession
issued by it, the demolition of improvements introduced by the successor-in-interest of a defeated
oppositor in the land registration case. Thus, in the foregoing cited case, Mr. Justice Jesus G. Barrera,
speaking for the Court, opined:
"It is contended that respondent Judge erred in denying the petition for demolition. To this we agree.
Section 13, Rule 39 of the Rules of Court, provides:
'SEC. 13. How execution for the delivery or restitution of property enforced. The ocer must enforce
an execution for the delivery or restitution of property by placing the plainti in possession of such
property, and by levying as hereinafter provided upon so much of the
For August 18, 2017 property of the judgment debtor as will satisfy the amount of costs, damages, rents,
and profits included in the execution. However, the ocer shall not destroy, demolish or remove the
improvements made by the defendant or his agent on the property, except by special order of the court,
which order may only issue upon petition of the plainti after due hearing and upon the defendant's failure
to remove the improvements within a reasonable time to be fixed by the court.
"Respondent Judge is of the view that the above quoted provision of the Rules of Court applies only to
ordinary actions involving the delivery or restitution of property, and not to proceedings under the land
registration law which, according to him, is silent on the point. The view is not correct, for the reason that
the provisions of the Rules of Court are applicable to land registration cases in a suppletory character
(Rule 132). Put dierently, if the writ of possession issued in a land registration proceeding implies the
delivery of possession of the land to the successful litigant therein (Demorar vs. Ibaez, 51 O. Gaz.,
2872, Pasay Estate Company vs. Del Rosario, et al., 11 Phil. 391; Manlapas vs. Llorente, 48 Phil. 298),
a writ of demolition must, likewise, issue, especially considering that the latter writ is but a complement
of the former which without said writ of demolition would be ineective.
"Apparently, respondent Judge, in refusing to issue the writ of demolition to petitioner, was of the belief
that the latter has another remedy, namely, by resorting to ordinary civil actions in the regular courts,
such as that of forcible entry and detainer, or the recovery of possession, in which instances, said courts
would then be competent to issue said writ. Such a situation, in our opinion, could not have been intended
by the law. To require a successful litigant in a land registration case to institute another action for the
purpose of obtaining possession of the land adjudged to him, would be a cumbersome process. It would
foster unnecessary and expensive litigations and result in multiplicity of suits, which our judicial system
abhors. In this connection, this Court on one occasion, said:

'But this construction of the law entirely defeats its purpose. It would compel a successful litigant in the
Court of Land Registration to commence other actions in other courts for the purpose of securing fruits
of his victory. The evident purpose of the law was to prevent that very thing; . . . " (Pasay Estates Co. vs.
Del Rosario, et al., supra)

"Furthermore, Section 6, Rule 124, of the Rules of Court states that

'When by law jurisdiction is conferred on a court or judicial ocer, all auxiliary writs, processes and other
means necessary to carry it into eect may be
!47 of 105!

employed by such court or ocer; and if the procedure to be followed in the exercise of such jurisdiction
is not specifically pointed out by these rules, any suitable process or mode of proceeding may be adopted
which appears most conformable to the spirit of said rules.

"As already stated, provisions of the Rules of Court are applicable to land registration cases in a
suppletory character. Pursuant to the provision just quoted, respondent Judge has the power to issue all
auxiliary writs, including the writ of demolition sought by petitioner, processes and other means necessary
to carry into eect the jurisdiction conferred upon it by law in land registration cases to issue a writ of
possession to the successful litigant, the petitioner herein.

"Lastly, in the case of Shioji vs. Harvey, 43 Phil 333, we pointed out that 'Independent of any statutory
provision, . . . every court has inherent power to do all things reasonably necessary for the administration
of justice within the scope of its jurisdiction.' In line with this doctrine, it may be stated the respondent
Judge, in the instant case, has the inherent power to issue the writ of demolition demanded by petitioner.
Needless to say, its issuance is reasonably necessary to do justice to petitioner who is being deprived of
the possession of the lots in question, by reason of the continued refusal of respondent Clemente
Pagsisihan to remove his house thereon and restore possession of the premises to petitioner.

We believe the above-quoted ruling aptly answers the arguments of respondents-appellants, the same
having practically identical sets of facts obtaining in the case at bar.

Appellants can not be regarded as builders in good faith because they are bound by the 1941 decree of
registration that obligated their parents and predecessors-in-interest. Good faith must rest on a colorable
right in the builder, beyond a mere stubborn belief in one's title despite judicial adjudication. The fact that
in 1959 appellants demolished and replaced their old house with new and bigger ones can not enervate
the rights of the registered owners. Otherwise, the rights of the latter to enjoy full possession of their
registered property could be indefinitely defeated by an unsuccessful opponent through the simple
subterfuge of replacing his old house with a new one from time to time.

WHEREFORE, the appealed order should be, as it is hereby, armed. With costs against respondents-
appellants.

Concepcion, C.J., Barrera, Dizon, Regala, Makalintal, J.P. Bengzon, Zaldivar and Sanchez, concur.

For August 18, 2017

FIRST DIVISION
[G.R. No. 138660. February 5, 2004.]
HEIRS OF TRINIDAD DE LEON VDA. DE ROXAS, petitioners, vs. COURT OF APPEALS and
MAGUESUN MANAGEMENT AND DEVELOPMENT CORPORATION, respondents.
DECISION
CARPIO, J p:
The Case
This is a petition to cite for indirect contempt the ocers of Meycauayan Central Realty Corporation
("Meycauayan") for defying the final and executory Decision and Resolution of this Court in G.R. No.
118436 entitled "Heirs of Manuel A. Roxas and Trinidad de Leon Vda. De Roxas v. Court of Appeals and
M a g u e s u n M a n a g e m e n t & D e v e l o p m e n t Corporation" ("G.R. No. 118436"). 1
The Antecedents
This petition stems from a case filed by Trinidad de Leon Vda. De Roxas to set aside the decree of
registration over two unregistered parcels of land in Tagaytay City granted to Maguesun Management
and Development Corporation ("Maguesun") before the Regional Trial Court on the ground of actual
fraud. The trial court dismissed the petition to set aside the decree of registration. On appeal, the Court
of Appeals denied the petition for review and armed the findings of the trial court. On 21 March 1997,
this Court reversed the appellate court's decision in G.R. No. 118436. The dispositive portion reads:
WHEREFORE, the instant petition is hereby GRANTED. The Decision of the Court of Appeals in C.A.
G.R. CV No. 38328 ("Trinidad de Leon Vda. de Roxas v. Maguesun Management & Development
Corporation, et al.") promulgated on December 8, 1994 is hereby REVERSED AND SET ASIDE.
Accordingly, registration of title over the subject parcels of land, described in Plan AS-04-000108, Lot
Nos. 7231 and 7239, with an area of 3,461 and 10,674 square meters, respectively, as shown and
supported by the corresponding technical descriptions now forming part of the Records of LRC No. TG-
373, is awarded to herein petitioner Trinidad de Leon vda. de Roxas and her heirs, herein substituted as
petitioners. Upon finality of this Decision, the Land Registration Authority is hereby directed to ISSUE
with reasonable dispatch the corresponding decree of registration and certificate of title pursuant to
Section 39 of Presidential Decree No. 1529.
!48 of 105!
On 22 May 1997, Meycauayan filed a Petition for Intervention in G.R. No. 118436. Meycauayan alleged
that on 14 May 1992, it purchased three parcels of land from Maguesun which form part of the property
awarded to the heirs of Trinidad de Leon Vda. De Roxas RoTas heirs"). Meycauayan contended that
since it is a purchaser in good faith and for value, the Court should aord it the opportunity to be heard.
Meycauayan contends that the adverse decision in G.R. No. 118436 cannot impair its rights as a
purchaser in good faith and for value.
On 25 June 1997, this Court denied the Petition for Intervention. This Court also denied the Motion for
Reconsideration filed by Maguesun. Thus, on 21 August 1997, the Decision dated 21 March 1997 in G.R.
No. 118436 became final and executory.
On 13 April 1998, the Land Registration Authority ("LRA") submitted a Report to the Regional Trial Court
of Tagaytay City, Branch 18 ("land registration court"), in LR Case No. TG-373, praying that the land
registration court:
a) Order the LRA to cancel Decree No. N-197092 in the name of Maguesun to enable it to issue
another decree in favor of the heirs of Manuel A. Roxas and Trinidad de Leon Vda. de Roxas;
b) Order the Register of Deeds to cancel OCT No. 0-515 and all its derivative titles; and
c) Order the issuance of the Decree with respect to the decision of the Supreme Court dated 21
March 1997.
Meycauayan filed with the land registration court a "Motion For Leave To Intervene And For Period Of
Time To File Opposition To The Report Dated March 25, 1998 Filed By The LRA And To File Complaint-
in-Intervention.
On 4 June 1998, the Roxas heirs filed a Motion for Clarification with this Court raising the following issues:
a) Whether it is necessary for the trial court to first order the LRA "to cancel Decree No. N-197092 in the
name of Maguesun Management and Development Corporation to enable (the LRA) to issue another
decree in favor of the Heirs of Manuel A. Roxas and Trinidad de Leon Vda. de Roxas"? Or is that order
necessarily included in the dispositive portion of the Supreme Court decision directing the LRA "to issue
with reasonable dispatch the corresponding decree of registration and certificate of title" in favor of the
Roxas heirs? Please note that this necessary implication is a consequence of the Supreme Court finding
that the decree in favor of Maguesun was wrongfully issued
For August 18, 2017 because it was "not entitled to the registration decree" as it had no registrable title,
since "Zenaida Melliza (from whom Maguesun supposedly bought the lots) conveyed no title over the
subject parcels of land to Maguesun Corporation as she was not the owner thereof.
b) Whether an order from the trial court is necessary for "the Register of Deeds concerned to
cancel OCT No. 0-515 and all its, derivative titles"? Or is that order necessarily included in the dispositive
portion of the Supreme Court decision directing the LRA to issue the corresponding decree of registration
and certificate of title in favor of the Roxas heirs, considering that the original certificate of title issued to
Maguesun was based on an illegal decree of registration as found by this Honorable Court. Further, the
unconditional order of the Supreme Court to LRA to issue the corresponding certificate of title to the
Roxas heirs necessarily implies that the OCT issued to Maguesun and its derivative titles shall be
canceled, for it cannot [be] assumed that the Supreme Court intended that the same parcel of land shall
be covered by more than one certificate of title.
c) Whether an order from the trial court is necessary before the LRA can comply with the Supreme
Court decision directing the LRA "to issue with reasonable dispatch the corresponding decree of
registration and certificate of title" in favor of the Roxas heirs?
On 23 June 1998, the Roxas heirs filed a Supplement to Motion for Clarification, the pertinent portions of
which are:
1. In petitioners' Motion for Clarification, one of the items sought to be clarified is whether the derivative
titles (i.e., the titles derived from Maguesun Management and Development Corporation's ["Maguesun"]
Original Certificate of Title No. 0-515 and issued to Meycauayan Central Realty Corp.) should be
canceled, together with Maguesun's certificates of title, so that new decree of registration and certificate
of title can be issued to petitioners, as ordered in the decision of this Honorable Court dated 21 March
1997, which has become final and executory?
2. From the Petition for Intervention filed by M e y c a u a y a n C e n t r a l R e a l t y C o r p o r a t i o n
("Meycauayan") with this Honorable Court on 22 May 1997, the following statements, among others, are
alleged:
a. "That on May 14, 1992, the intervenor purchased for value several parcels of real property from private
respondent Maguesun Management and Development Corp. covered by TCT Nos. 24294, 24295 and
24296
!49 of 105!

containing an area of 2,019 square meters each, more or less.
b. "That prior to paying the agreed purchase price in full to respondent Maguesun, an
investigation with the Tagaytay City Oce of the Register of Deeds was made to determine and ascertain
the authenticity, status and condition of the titles of Maguesun over the aforesaid properties.
c. "That investigation made by the intervenor with the Oce of Register of Deeds of Tagaytay
City showed that in all the certified true copies of the titles to the properties above-mentioned which were
registered in the name of Maguesun, the last entry which appeared was the following, to wit: . . . .
d. "Appearing that the properties to be purchased by the herein intervenor from respondent
Maguesun have no existing liens and/or encumbrances and considering that the properties do not appear
to be the subject of a pending case which would aect the titles of those who may subsequently purchase
the same, the herein intervenor proceeded to pay, in full, the total amount of ONE MILLION FIVE
HUNDRED THOUSAND PESOS (P1,500,000.00) to Maguesun. Immediately thereafter, Maguesun,
through its duly authorized ocer, executed the corresponding Deeds of Absolute Sale.
e. "That after the corresponding taxes and/or fees were paid by herein intervenor, the
aforementioned TCT Nos. T-24294, 24295 and 24296, were canceled and in lieu thereof, new titles in
the name of intervenor were issued by the Register of Deeds of Tagaytay City.
f. "That on March 25, 1997, an ocer of the intervenor corporation was informed of a newspaper
report stating, in big bold letters, the following sub-headline, to wit:
SC RULES ON ROXAS FAMILY LAND ROW IN TAGAYTAY
g. "The President of herein intervenor right after secured from the Tagaytay City Oce of the
Register of Deeds certified true copies of torrens titles over its Tagaytay City properties.
h. "That only then, after it secured certified true copies of the titles mentioned in the preceding
paragraph from the Oce of the Register of Deeds of Tagaytay City, did intervenor come to know of the
existence of a case involving the properties sold to it by respondent Maguesun on May 14, 1992.
3. Meycauayan's Petition for Intervention was denied by this Honorable Court in its Resolution dated 25
June
For August 18, 2017
1997, a denial that has since become final and executory. However, as stated in petitioners' Motion for
Clarification, Meycauayan committed the proscribed act of forum-shopping by filing with the trial court a
motion for leave to intervene raising again the issue of its alleged ownership of portions of the land.
4. In order to settle once and for all Meycauayan's allegation that it was a buyer in good faith, and to show
that its derivative titles should be declared void and canceled by this Honorable Court, petitioners will
show herein that the sale to Meycauayan was spurious or, at the very least, it was a buyer in bad faith.
In a Resolution dated 29 July 1998, this Court acted favorably on the Roxas heirs' Motion for Clarification
and its Supplement. The pertinent portions of the Resolution read:
Upon careful consideration of the points made by petitioners in their motions, this Court finds the same
meritorious and, hence, a clarification is in order. We, therefore, declare that our directive on the LRA to
issue with reasonable dispatch the corresponding decree of registration and certificate of title also
includes, as part thereof, the cancellation, without need of an order of the land registration court, of
Decree No. N-197092, as well as OCT No. 0-515, and all its derivative titles. This is a necessary
consequence of the Court's earlier finding that the foregoing documents were illegally issued in the name
of respondent. But in light of Section 39 of Presidential Decree No. 1529 (the "Property Registration
Decree"), Decree No. N-197092 which originated from the LRA must be cancelled by the LRA itself. On
account of this cancellation, it is now incumbent upon the LRA to issue in lieu of the cancelled decree a
new one in the name of petitioners as well as the corresponding original certificate of title. Cancellation
of OCT No. 0-515, on the other, hand, properly devolves upon the Register of Deeds who, under Section
40 of P.D. No. 1529, has earlier entered a copy thereof in his record book. OCT No. 0-515 having been
nullified, all titles derived therefrom must also be considered void it appearing that there had been no
intervening rights of an innocent purchaser for value involving the lots in dispute.
ACCORDINGLY, the Court hereby resolves to GRANT petitioners' Motion for Clarification together with
the Supplement thereto. For this reason, the dispositive portion of our decision dated March 21, 1997 is
clarified, thus:
First, the Register of Deeds shall CANCEL OCT No. 0-515 and all its derivative titles, namely, TCT Nos.
T-25625, T-25626, T-25627, T-25628, T-25688, T-25689, and T-25690, the latter three being already in
the name
!50 of 105!
of Meycauayan Realty and Development Corporation (also designated as "Meycauayan Central Realty,
Inc." and "Meycauayan Realty Corporation).
Thereafter, the Land Registration Authority shall:
(a) CANCEL Decree No. N-197092 originally issued in the name of Maguesun Management and
Development Corporation without need of an order from the land registration court; and
(b) ISSUE with reasonable dispatch a new decree of registration and a new original certificate of
title (OCT) in favor of petitioners pursuant to Section 39 of Presidential Decree No. 1529. (Emphasis
added)
On 11 December 1998, the land registration court issued an order denying the LRA Report dated 25
March 1998 and the Motion for Leave to Intervene filed by Meycauayan since the Supreme Court
Resolution of 29 July 1998 had rendered them moot.
The Register of Deeds of Tagaytay City then canceled TCT Nos. T-25626, T-25627, T-25628, T-25688,
T-25689, T-25690 and T-27390. 3 TCT Nos. T-25688, T-25689, T-25690 and T-27390 were derivative
titles already in the name of Meycauayan.
On 5 April 1999, the Roxas heirs filed a Motion for Issuance of Writ of Possession with the land
registration court.
On 20 April 1999, Meycauayan filed a Complaint for reconveyance, damages and quieting of title with
the trial court entitled "Meycauayan Central Realty Corp. v. Heirs of Manuel A. Roxas and Trinidad de
Leon Vda. de Roxas, Maguesun Management and Development Corp., Register of Deeds of Tagaytay
City, City Assessor of Tagaytay City and Land Registration Authority." 4 The Complaint is almost an exact
reproduction of the Petition for Intervention filed by Meycauayan before this Court. The Complaint prayed
for judgment:
1. Ordering the defendants Land Registration Authority and the Register of Deeds of Tagaytay
City to cancel the titles and decree of registration they issued in lieu of TCT Nos. 25688, 25689, 25690
and 27390 registered in the name of plainti Meycauayan Central Realty Corporation and reconvey said
properties to the plainti corporation by reinstating the said cancelled titles or if the same not be possible,
cause the issuance of new decrees and titles thereto;
2. Ordering the defendant City Assessor of Tagaytay City to reinstate the Assessments for real
estate taxes it previously cancelled covering the properties of plainti;

For August 18, 2017
3. Ordering the defendants Roxas and Maguesun to jointly and solidarily pay the plainti actual
and/or compensatory damages in the total amount of FIVE HUNDRED THOUSAND PESOS
(P500,000.00);
4. Ordering the defendants Roxas and Maguesun to jointly and solidarily pay the plainti the
amount of TWO HUNDRED THOUSAND PESOS (P200,000.00) as and by way of nominal damages;
5. Ordering the defendants Roxas and Maguesun to jointly and solidarily pay the plainti
exemplary damages in the amount of TWO HUNDRED THOUSAND PESOS (P200,000.00);
6. Ordering the defendants Roxas and Maguesun to jointly and solidarily pay the plainti
Attorney's fees in the amount of ONE HUNDRED THOUSAND PESOS (P100,000.00); and
7. Ordering the defendants Roxas and Maguesun to jointly and solidarily pay the plainti the costs
of suit. 5 On 6 May 1999, Meycauayan filed a "Special Appearance Questioning Court Jurisdiction and
Opposition to the Motion for Issuance of Writ of Possession Against Meycauayan Central Realty
Corporation" with the land registration court.
On 2 September 1999, the land registration court issued an order, the dispositive portion of which reads:
WHEREFORE, in the light of the foregoing, let a Writ of Possession be issued against Maguesun
Management and Development Corporation in these cases. However, insofar as Meycauayan Central
Realty is concerned, let a resolution of the motion filed by the movants herein be deferred until the
Supreme Court had resolved with finality the petition for contempt of herein movant in G.R. No. 138660.
On 7 March 2000, the trial court dismissed for lack of merit Meycauayan's complaint for reconveyance,
damages and quieting of title. The trial court held that
(1) the nullity of OCT No. 0-515, which is the source of Meycauayan's titles, is now res judicata; (2) the
complaint's prayer for the trial court to annul the decision of the Supreme Court in G.R. No. 118436 is
beyond the trial court's jurisdiction; and (3) Meycauayan is guilty of forum shopping. 6 The trial court
likewise denied Meycauayan's Motion for Reconsideration in an Order dated 20 June 2000. 7 On 24
August 2000, Meycauayan filed a petition for certiorari under Rule 65 of the Rules of Court with the Court
of Appeals assailing the trial court's dismissal of the complaint.
!51 of 105!
Meanwhile, the Roxas heirs filed on 2 June 1999 this petition to cite for indirect contempt the ocers of
Meycauayan.
The Issues
The parties raised the following issues:
1. Whether this Court's Decision and Resolution in G.R. No. 118436 bind Meycauayan;
2. Whether Meycauayan's act of filing with the trial court a complaint for reconveyance, damages
and quieting of title involving parcels of land, which were the subject of this Court's Decision and
Resolution in G.R. No. 118436, constitutes indirect contempt under Section 3, Rule 71 of the Rules of
Civil Procedure; and
3. Whether Meycauayan is guilty of forum shopping. The Court's Ruling
The petition is meritorious. We find Meycauayan's Executive Vice-President Juan M. Lamson, Jr. guilty
of indirect contempt. We also find that Meycauayan committed forum shopping, and thus Meycauayan
and its Executive Vice President Juan M. Lamson, Jr. are guilty of direct contempt.
The Roxas heirs allege that the following acts of Meycauayan constitute indirect contempt under Section
3, Rule 71 of the Rules of Civil Procedure: (1) Meycauayan's defiance of the final and executory Decision
and Resolution of this Court in G.R. No. 118436; (2) its act of filing pleadings before the land registration
court to prevent execution of the Decision and Resolution; (3) its act of filing a Complaint raising the same
issues in its Petition for Intervention which this Court had already denied and urging the trial court to
ignore and countermand the orders of this Court.
On the other hand, Meycauayan alleges that the Decision in G.R. No. 118436, does not bind Meycauayan
because it was not a party in the case. According to Meycauayan, the Decision in G.R. No. 118436 may
be enforced against Maguesun but not against Meycauayan which is a stranger to the case. Meycauayan
insists that as a purchaser in good faith and for value its rights cannot be prejudiced by the alleged
fraudulent acquisition by Maguesun of the subject properties. Meycauayan, therefore, is not liable for
contempt of court for filing an action for reconveyance, quieting of title and damages.
The issue of whether the Decision in G.R. No. 118436 binds Meycauayan was already addressed by this
Court when it denied Meycauayan's Petition for
For August 18, 2017
Intervention. Furthermore, this Court's Resolution dated 29 July 1998 clarified the Decision dated 21
March 1997 by ordering the Register of Deeds to CANCEL OCT No. 0-515 and all its derivative titles,
namely, TCT Nos. T-25625, T-25626, T-25627, T-25628, T-25688, T-25689, and T-25690, the latter three
already in the name of Meycauayan Realty and Development Corporation (also designated as
"Meycauayan Central Realty, Inc." and "Meycauayan Realty Corporation"). This Court also found that
there had been no intervening rights of an innocent purchaser for value involving the lots in dispute.
Indirect Contempt
Meycauayan's obstinate refusal to abide by the Court's Decision in G.R. No. 118436 has no basis in view
of this Court's clear pronouncement to the contrary. The fact that this Court specifically ordered the
cancellation of Meycauayan's titles to the disputed parcels of land in the Resolution dated 29 July 1998
should have laid to rest the issue of whether the Decision and Resolution in G.R. No. 118436 is binding
on Meycauayan. Clearly, Meycauayan's defiance of this Court's Decision and Resolution by filing an
action for reconveyance, quieting of title and damages involving the same parcels of land which this Court
already decided with finality constitutes indirect contempt under Section 3(d), Rule 71 of the Rules of Civil
Procedure. Section 3(d) of Rule 71 reads:
SEC. 3. Indirect contempt to be punished after charge and hearing. After a charge in writing has been
filed, and an opportunity given to the respondent to comment thereon within such period as may be fixed
by the court and to be heard by himself or counsel, a person guilty of any of the following acts may be
punished for indirect contempt:
xxx xxx xxx
(d) Any improper conduct tending, directly or indirectly, to impede, obstruct, or degrade the administration
of justice;
In Halili, et al. v. CIR, et al., 8 this Court explained the concept of contempt of court:
Contempt of court is a defiance of the authority, justice or dignity of the court; such conduct as tends to
bring the authority and administration of the law into disrespect or to interfere with or prejudice parties
litigant or their witnesses during litigation (12 Am. Jur. 389, cited in 14 SCRA 813).

Contempt of court is defined as a disobedience to the Court by acting in opposition to its authority, justice
and dignity. It signifies not only a willful disregard or
!52 of 105!
disobedience of the court's orders, but such conduct as tends to bring the authority of the court and the
administration of law into disrepute or in some manner to impede the due administration of justice (17
C.J.S.4). This Court has thus repeatedly declared that the power to punish for contempt is inherent in all
courts and is essential to the preservation of order in judicial proceedings and to the enforcement of
judgments, orders, and mandates of the court, and consequently, to the due administration of justice
(Slade Perkins vs. Director of Prisons, 58 Phil. 271; In re Kelly, 35 Phil. 944; Commissioner of Immigration
vs. Cloribel, 20 SCRA 1241; Montalban vs. Canonoy, 38 SCRA 1).
Meycauayan's continuing resistance to this Court's judgment is an aront to the Court and to the
sovereign dignity with which it is clothed. 9 Meycauayan's persistent attempts to raise issues long since
laid to rest by a final and executory judgment of no less than the highest tribunal of the land constitute
contumacious defiance of the authority of this Court and impede the speedy administration of justice.
Well-settled is the rule that when a court of competent jurisdiction has tried and decided a right or fact,
so long as the decision remains unreversed, it is conclusive on the parties and those in privity with them.
11 More so where the Supreme Court has already decided the issue since the Court is the final arbiter
of all justiciable controversies properly brought before it. 12 As held in Buaya v. Stronghold Insurance
Co., Inc.:
. . . An existing final judgment or decree rendered upon the merits, without fraud or collusion, by a
court of competent jurisdiction acting upon a matter within its authority is conclusive of the rights of the
parties and their privies. This ruling holds in all other actions or suits, in the same or any other judicial
tribunal of concurrent jurisdiction, touching on the points or matters in issue in the first suit.
xxx xxx xxx
Courts will simply refuse to reopen what has been decided. They will not allow the same parties or their
privies to litigate anew a question, once it has been considered and decided with finality. Litigations must
end and terminate sometime and somewhere. The eective and ecient administration of justice requires
that once a judgment has become final, the prevailing party should not be deprived of the fruits of the
verdict by subsequent suits on the same issues filed by the same parties.
This is in accordance with the doctrine of res judicata which has the following elements: (1) the former
judgment must be final; (2) the court which rendered it had jurisdiction over the subject matter and the
parties;
For August 18, 2017
(3) the judgment must be on the merits; and (4) there must be between the first and the second actions,
identity of parties, subject matter and causes of action. 14 The application of the doctrine of res judicata
does not require absolute identity of parties but merely substantial identity of parties. 15 There is
substantial identity of parties when there is community of interest or privity of interest between a party in
the first and a party in the second case even if the first case did not implead the latter.
The Court ruled in G.R. No. 118436 that Meycauayan's predecessor-in-interest, Maguesun, committed
actual fraud in obtaining the decree of registration of the subject properties. The Decision in G.R. No.
118436 binds Meycauayan under the principle of "privity of interest" since it was a successor-in-interest
of Maguesun. Meycauayan, however, insists that it was a purchaser in good faith because it had no
knowledge of any pending case involving the lots. Meycauayan claims that the trial court had already
canceled the notice of lis pendens on the titles when it purchased the lots from Maguesun. In its
Memorandum, Meycauayan stresses that to ensure the authenticity of the titles and the annotations
appearing on the titles, particularly the cancellation of the notice of lis pendens, Meycauayan checked
with the Register of Deeds and the Regional Trial Court of Tagaytay City. 17 Since Meycauayan checked
with the Regional Trial Court of Tagaytay City, Meycauayan then had actual knowledge, before it
purchased the lots, of the pending case involving the lots despite the cancellation of the notice of lis
pendens on the titles.
Furthermore, as found by this Court in G.R. No. 118436, the Roxas family has been in possession of the
property uninterruptedly through their caretaker, Jose Ramirez who resided on the property. 18 Where
the land sold is in the possession of a person other than the vendor, the purchaser must go beyond the
certificates of title and make inquiries concerning the rights of the actual possessor. 19 Meycauayan
therefore cannot invoke the right of a purchaser in good faith and could not have acquired a better right
than its predecessor-in-interest. This Court has already rejected Meycauayan's claim that it was a
purchaser in good faith when it ruled in G.R. No. 118436 that there had been no intervening rights of an
innocent purchaser for value involving the lots in dispute. As held in Heirs of Pael v. Court of Appeals:
In the case of Santiago Land Development Corporation vs. Court of Appeals (G.R. No. 106194, 276
SCRA 674 [1997]), petitioner maintained that as a purchaser pendente lite of the land in litigation, it had
a right to intervene under Rule 12, Section 2. We rejected this position and said that "since petitioner is
not a stranger
!53 of 105!
to the action between Quisumbing and the PNB, petitioner in fact having stepped into the shoes of PNB
in a manner of speaking, it follows that it cannot claim any further right to intervene in the action." As in
the instant Petition, it was argued that the denial of the Motion to Intervene would be a denial likewise of
due process. But this, too, was struck down in Santiago Land where we held that "petitioner is not really
denied protection. It is represented in the action by its predecessor in interest." Indeed, since petitioner
is a transferee pendente lite with notice of the pending litigation between Reyes and private respondent
Carreon, petitioner stands exactly in the shoes of Reyes and is bound by any judgment or decree which
may be rendered for or against the latter.
Indeed, one who buys property with full knowledge of the flaws and defects of the title of his vendor and
of a pending litigation over the property gambles on the result of the litigation and is bound by the outcome
of his indierence. 21 A purchaser cannot close his eyes to facts which should put a reasonable man on
guard and then claim that he acted in good faith believing that there was no defect in the title of the
vendor.
For the penalty for indirect contempt, Section 7 of Rule 71 of the Rules of Court provides:
SEC. 7. Punishment for indirect contempt. If the respondent is adjudged guilty of indirect contempt
committed against a Regional Trial Court or a court of equivalent or higher rank, he may be punished by
a fine not exceeding thirty thousand pesos or imprisonment not exceeding six (6) months or both. . . .
In this case, Meycauayan Executive Vice President Juan M. Lamson, Jr. caused the preparation and the
filing of the Petition for Intervention in G.R. No. 118436 and the Complaint for Reconveyance, Damages
and Quieting of Title with the trial court. 23 Juan M. Lamson, Jr. signed the verification and certification
of non-forum shopping for the Petition for Intervention and the Complaint for Reconveyance, Damages
and Quieting of Title. "Even though a judgment, decree, or order is addressed to the corporation only,
the ocers, as well as the corporation itself, may be punished for contempt for disobedience to its terms,
at least if they knowingly disobey the court's mandate, since a lawful judicial command to a corporation
is in eect a command to the ocers." 24 Thus, for improper conduct tending to impede the orderly
administration of justice, Meycauayan Executive Vice President Juan M. Lamson, Jr. should be fined ten
thousand pesos (P10,000). 25
For August 18, 2017
Direct Contempt
Meycauayan's act of filing a Complaint for Reconveyance, Quieting of Title and Damages raising the
same issues in its Petition for Intervention, which this Court had already denied, also constitutes forum
shopping. Forum shopping is the act of a party against whom an adverse judgment has been rendered
in one forum, seeking another and possibly favorable opinion in another forum other than by appeal or
special civil action of certiorari. There is also forum shopping when a party institutes two or more actions
based on the same cause on the expectation that one or the other court might look with favor on the
party.

In this case, the Court had already rejected Meycauayan's claim on the subject lots when the Court
denied Meycauayan's Petition for Intervention in G.R. No. 118436. The Court ruled that there had been
no intervening rights of an innocent purchaser for value involving the lots in dispute. The Decision of this
Court in G.R. No. 118436 is already final and executory. The filing by Meycauayan of an action to re-
litigate the title to the same property, which this Court had already adjudicated with finality, is an abuse
of the court's processes and constitutes direct contempt.

Section 5 of Rule 7 of the Rules of Court provides that "if the acts of the party or his counsel clearly
constitute willful and deliberate forum shopping, the same shall be a ground for summary dismissal with
prejudice and shall constitute direct contempt, as well as a cause for administrative sanctions." The fact
that Meycauayan did mention in its certification of non-forum shopping its attempt to intervene in G.R.
No. 118436, which this Court denied, 27 does not negate the existence of forum shopping. This disclosure
does not exculpate Meycauayan for deliberately seeking a friendlier forum for its case and re-litigating an
issue which this Court had already decided with finality.

The general rule is that a corporation and its ocers and agents may be held liable for contempt. A
corporation and those who are ocially responsible for the conduct of its aairs may be punished for
contempt in disobeying judgments, decrees, or orders of a court made in a case within its jurisdiction.

Under Section 1 of Rule 71 of the Rules of Court, direct contempt is punishable by a fine not exceeding
two thousand pesos (P2,000) or imprisonment not exceeding ten (10) days, or both, if committed against
a Regional Trial Court or a court of equivalent or higher rank. Hence, Meycauayan 30 and its Executive
Vice President Juan M. Lamson, Jr. are each fined P2,000 for direct contempt of court for forum shopping.
!54 of 105!

WHEREFORE, we find Meycauayan Central Realty Corporation's Executive Vice President Juan M.
Lamson, Jr. GUILTY of INDIRECT CONTEMPT and FINE him TEN THOUSAND PESOS (P10,000).
Furthermore, we find Meycauayan Central Realty Corporation and its Executive Vice President Juan M.
Lamson, Jr. GUILTY of DIRECT CONTEMPT for forum shopping and FINE them TWO THOUSAND
PESOS (P2,000) each. The Court warns them that a repetition of the same or similar oense shall merit
a more severe penalty.

SO ORDERED.

Davide, Jr., C.J., Panganiban and Ynares-Santiago, JJ., concur.

Azcuna, J., is on ocial leave.

EN BANC
[G.R. No. L-26127. June 28, 1974.]
(Civil Case No. 3621)
VICTOR BENIN, ET AL., plaintis-appellees, vs. MARIANO SEVERO TUASON y DE LA PAZ, ET AL.,
defendants. J. M. TUASON & CO., INC., defendant-appellant.
[G.R. No. L-26128. June 28, 1974.]
(Civil Case No. 3622)
JUAN ALCANTARA, ET AL., plaintis-appellees, vs. MARIANO SEVERO TUASON y DE LA PAZ, ET
AL., defendants. J.M. TUASON & CO., INC., defendant-appellant.
[G.R. No. L-26129. June 28, 1974.]
(Civil Case No. 3623)
DIEGO PILI, ET AL., plaintis-appellees, vs. MARIANO SEVERO TUASON y DE LA PAZ, ET AL.,
defendants. J.M. TUASON & CO., INC., defendant-appellant.
Jose Palarca Law Oces for plaintis-appellees. Manuel O. Chan & Rodolfo M. Caluag for defendant-
appellant.
D E C I S I O N ZALDIVAR, J p:
Appeal from the decision, dated January 18, 1965, of the Court of First Instance of Rizal, the Hon. Judge
Eulogio Mencias, presiding, in Civil Cases Nos. 3621, 3622, and 3623.
On May 19, 1955 three sets of plaintis filed three separate complaints containing substantially the same
allegations.
In Civil Case No. 3621, the plaintis alleged that they were the owners and possessors of three parcels
of
For August 18, 2017 agricultural lands, described in paragraph V of the complaint, located in the barrio
of La Loma (now barrio of San Jose) in the municipality (now city) of Caloocan, province of Rizal, having
an aggregate area of approximately 278,928 square meters: that they inherited said parcels of land from
their ancestor Sixto Benin, who in turn inherited the same from his father, Eugenio Benin; that they and
their predecessors in interest had possessed these three parcels of land openly, adversely, and
peacefully, cultivated the same and exclusively enjoyed the fruits harvested therefrom; that Eugenio
Benin, plaintis' grandfather, had said parcels of land surveyed on March 4 and 6, 1894; that during the
cadastral survey by the Bureau of Lands of the lands in barrio San Jose in 1933 Sixto Benin and herein
plaintis registered their claims of ownership over said parcels of land; that they declared said lands for
taxation purposes in 1940 under Tax Declaration No. 2429; that after the outbreak of the last World War,
or sometime in 1942 and subsequently thereafter, evacuees from Manila and other places, after having
secured the permission of plaintis, constructed their houses thereon and paid monthly rentals to
plaintis.
In Civil Case No. 3622 the plaintis alleged that they were the owners and possessors of two parcels of
agricultural land, described in paragraph V of the complaint, located in the Barrio of La Loma (now Barrio
San Jose) in the municipality of Caloocan, province of Rizal, having an aggregate area of approximately
148,118 square meters; that these parcels of land were inherited by them from their deceased father
Bonoso Alcantara, who in turn inherited the same from his father, Juan Alcantara; that plaintis Juan
Alcantara and Jose Alcantara were the children of Bonoso Alcantara; that these two brothers inherited
the land from their father, and they and their predecessors in interest had been in open, adverse and
continuous possession of the same, planting therein palay and other agricultural products and exclusively
enjoying said products; that on March 28, 1894 plaintis' grandfather, Juan Alcantara, had said lands
surveyed; that during the cadastral survey by the Bureau of Lands of the lands in Barrio San Jose in 1933
Bonoso Alcantara and the plaintis filed and registered their claims of ownership over said lands; that
plaintis had said lands declared for taxation purposes under Tax Declaration No. 2390, of Quezon City;
that after the outbreak of the last World War, or sometime in 1942 and subsequently thereafter, evacuees
from Manila and other places, after having secured permission from plaintis, settled and constructed
their houses on said lands and plaintis collected monthly rentals from them.
In Civil Case No. 3623, plaintis alleged that they are the owners and possessors of a parcel of
agricultural
!55 of 105!
land located in the Barrio of La Loma (now San Jose), municipality of Caloocan, province of Rizal, having
an area of approximately 62,481 square meters; that this parcel of land was inherited by plaintis from
their ancestor Candido Pili who in turn inherited the same from his parents; that Candido Pili and his
predecessors in interest owned, possessed, occupied and cultivated the said parcel of land from time
immemorial; that upon the death of Candido Pili his children Luisa Pili, Pascual Pili, Diego Pili and Manuel
Pili succeeded to the ownership and possession and cultivation of said land; that plaintis and their
predecessors in interest, as owners and possessors of said land, had openly, adversely an continuously
cultivated the land, planting thereon palay and other agricultural products and enjoying exclusively the
products harvested therefrom; that during his lifetime, Candido Pili ordered the survey of said land
sometime on March 11, 1894, and when the cadastral survey of said land was conducted by the Bureau
of Lands in 1933 Candido Pili and plaintis filed and registered their claim of ownership over the said
parcel of land; that plaintis had the land declared for taxation purposes under Tax Declaration No. 2597,
Quezon City, Philippines; that after the outbreak of the last World War, or sometime in 1942 and
subsequently thereafter, evacuees from Manila and other places, after securing permission from
plaintis, settled and constructed their houses in said land and plaintis collected monthly rentals from
their lessees or tenants.
The plaintis in these three civil cases uniformly alleged, in their respective complaint, that sometime in
the year 1951 while they were enjoying the peaceful possession of their lands, the defendants, particularly
the defendant J.M. Tuason and Co. Inc., through their agents and representatives, with the aid of armed
men, by force and intimidation, using bulldozers and other demolishing equipment, illegally entered and
started defacing, demolishing and destroying the dwellings and constructions of plaintis' lessees, as
well as the improvements consisting of rice paddies (pilapiles), bamboos and fruit trees, and permanent
improvements such as old roads, old bridges and other permanent landmarks within and outside the
lands in question, disregarding the objections of plaintis, and as a result plaintis were deprived of the
rentals received from their lessees; that plaintis made inquiries regarding the probable claim of
defendants, and in 1953 they discovered for the first time that their lands, as described in their respective
complaint, had either been fraudulently or erroneously included, by direct or constructive fraud, in what
appears as Parcel No. 1 (known as Santa Mesa Estate) in Original Certificate of Title No. 735 of the Land
Records of the province of Rizal in the names of the original applicants for registration, now defendants,
Mariano Severo Tuason y
For August 18, 2017 de la Paz, Teresa Eriberta Tuason y de la Paz, Juan Jose Tuason y de la Paz,
Demetrio Asuncion Tuason y de la Paz, and Augusto Huberto Tuason y de la Paz.
The plaintis in each of the three complaints also alleged that the registered owners mentioned in Original
Certificate of Title No. 735 had applied for the registration of two parcels of land (known as the Santa
Mesa Estate and the Diliman Estate), located in the municipalities of Caloocan and San Juan del Monte,
province of Rizal, of which parcel No. 1 (Santa Mesa Estate) contained an area of 8,798,617 square
meters; that the registration proceedings were docketed as LRC No. 7681 of the Court of Land
Registration; that the application for registration in LRC No. 7681, containing the boundaries, technical
descriptions and areas of parcel No. 1 (Santa Mesa Estate) and parcel No. 2 (Diliman Estate) was
published in the Ocial Gazette; that before the decision was handed down in LRC No. 7681, the area,
boundaries and technical descriptions of parcel No. 1 were altered and amended; that the amendments
and alterations, which were made after the publication of the original application, were never published;
that on March 7, 1914 a decision was rendered in LRC No. 7681 based on the amended plan; that
pursuant to the decision of March 7, 1914 a decree of registration was issued on July 6, 1914, known as
Decree No. 17431, decreeing the registration in the names of the applicants of the two parcels of land
(Santa Mesa Estate and Diliman Estate); that the decision dated March 7, 1914 in LRC No. 7681 is null
and void because the Land Registration Court had no jurisdiction to render the decision for lack of
publication; that Decree No. 17431 issued pursuant to the decision of March 7, 1914 in LRC No. 7681 is
likewise null and void from the beginning, because it was issued pursuant to a void decision and because
the boundaries, technical descriptions and areas appearing in the decree are dierent and not identical
with the boundaries, technical descriptions and areas in the application for registration as published in
the Ocial Gazette; that the area of parcel No. 1 as mentioned in Decree No. 17431 is bigger than the
area of parcel No. 1 appearing in the application for registration as published in the Ocial Gazette; that
Original Certificate of Title No. 735, referring to parcel 1 (Santa Mesa Estate), is also null and void from
the beginning because it was issued pursuant to a void decree of registration; that the area, boundaries
and technical description of Parcel No. 1 appearing in Decree of Registration No. 17431 and in the
Original Certificate of Title No. 735 are dierent from the area, boundaries and technical description
appearing in the application for registration as published in the Ocial Gazette; that the plaintis had not
been notified of the proceedings in LRC No. 7681 although the applicants knew, or could have known,
by the exercise of necessary diligence, the names and addresses of the
!56 of 105!
plaintis and their predecessors in interest who were then, and up to the time the complaints were filed,
in possession and were cultivating the lands described in paragraph V of their respective complaint; and
that during, before, and even after the issuance of Original Certificate of Title No. 735 the defendants had
tacitly recognized the ownership of the plaintis over their respective lands because said defendants had
never disturbed the possession and cultivation of the lands by the plaintis until the year 1951; and that
all transfer certificates of title issued subsequently, based on Original Certificate of Title No. 735, are also
null and void.
The plaintis in each of the three cases prayed the court: (1) to declare them owners and entitled to the
possession of the parcel, or parcels, of land described in their respective complaint, as the case may be;
(2) to revoke the decision of the Court of Land Registration, dated March 7, 1914 in LRC No. 7681, and
to declare Decree No. 17431, dated July 6, 1914 null and void from the beginning with respect to Parcel
No. 1 (Santa Mesa Estate) in Original Certificate of Title No. 735 which include the lands of the plaintis;
(3) to declare Original Certificate of Title No. 735, particularly as it refers to Parcel No. 1 (Santa Mesa
Estate) also null and void; (4) to declare null and void all transfer certificates of titles issued by the Register
of Deeds of Rizal and of Quezon City subsequent to, and based on, Original Certificate of Title No. 735;
(5) to order the defendants, in the event Original Certificate of Title No. 735 is declared valid, to reconvey
and transfer title over the land described in their respective complaint in favor of the plaintis in each
case, as the case may be; (6) to order the defendants to pay the plaintis the market value of the lands
in question in case of defendants' inability to reconvey the same; (7) to order the defendants to pay
damages to the plaintis; (8) to issue a writ of preliminary injunction against the defendants, their lawyers,
their agents and representatives from disturbing the ownership and possession of the plaintis during the
pendency of these cases.
The plaintis, in the three cases, were allowed by the trial court to litigate as paupers.
Only defendant J.M. Tuason & Co., Inc. was actually served with summons. The other defendants were
ordered summoned by publication in accordance with Sections 16 and 17 of the Rules of Court. Only
defendant J.M. Tuason & Co., Inc. appeared. The other defendants were all declared in default.
On June 23, 1955 defendant J.M. Tuason & Co., Inc. filed a motion to dismiss in each of the three cases.
This motion to dismiss was denied by the trial court on July 20, 1955.
For August 18, 2017
On July 18, 1955 the trial court issued an order granting the writ of preliminary injunction prayed for by
the plaintis in their complaints. The preliminary injunction, however, was lifted by order of the trial court
on October 3, 1955, upon the posting by defendant J.M. Tuason & Co., Inc. of bonds in the total amount
of P14,000.00 pursuant to the order of the court of September 26, 1955.
On August 11, 1955 defendant J.M. Tuason & Co., Inc. filed in the three cases a motion for
reconsideration of the order of July 20, 1955 denying the motion to dismiss. This motion for
reconsideration was denied by order of the court of September 26, 1955.
On November 29, 1955 defendant J.M. Tuason & Co., Inc. filed an answer in each of the three cases. In
its answer, this defendant, among others, specifically denied plaintis' claim of ownership of the lands
involved in each case. The answer contains special and armative defenses, to wit: (1) that the plaintis'
cause of action is barred by prior judgment and res judicata in view of the judgment of the Court of First
Instance of Rizal in its Civil Case No. Q-156 which was subsequently elevated to the Supreme Court as
G.R. No. L-4998, in which latter case the Supreme Court armed in toto the order of the lower court
dismissing the case; (2) that the complaints failed to state facts sucient to constitute a cause of action
against the defendants; (3) that the plaintis' action, assuming that their complaints state sucient cause
of action, had prescribed either under Act No. 496 or under statutes governing prescription of action; (4)
that defendant J.M. Tuason & Co., Inc. is a buyer in good faith and for valuable consideration of the
parcels of land involved in the three cases; (5) that the registration proceedings had in LRC No. 7681
instituted by the defendant's predecessors in interest was in accordance with law, and the requirements
for a valid registration of title were complied with. By way of counterclaim the defendant prayed that the
plaintis be ordered to pay damages as therein specified.
The plaintis, amended their complaints in the three cases by including additional parties as plaintis,
and the amended complaints were admitted by the trial court. The defendant, J.M. Tuason & Co., Inc.,
filed a manifestation that it was reproducing and realleging its answers to the original complaints as its
answers to the amended complaints in view of the fact that the amendments to the complaints consist
merely in the inclusion of additional indispensable as well as necessary parties-plaintis.
On June 7, 1962, after the plaintis had presented their evidence, defendant J.M. Tuason & Co., Inc.
presented a motion to dismiss the cases upon grounds that (1) the
!57 of 105!
actions were barred by the statute of limitations; (2) that the actions were barred by a prior judgment; and
(3) that plaintis had not presented any evidence to prove their claim of ownership. The defendant later
filed a motion to withdraw the third ground of its motion to dismiss. The plaintis filed their opposition to
the motion to dismiss, as well as to the motion of defendant to withdraw its third ground to dismiss. The
trial court, in an order dated December 3, 1962, granted defendant's motion to withdraw the third ground
of its motion to dismiss but denied the motion to dismiss.
After trial, on January 18, 1965, the lower court rendered a decision for the three cases, the dispositive
portion of which reads as follows:
"WHEREFORE, IN VIEW OF ALL THE FOREGOING, judgment is hereby rendered in favor of the
Plaintis and against the Defendants as follows:
"A Declaring that the decision, the decree and the title issued in LRC No. 7681, are null and void, ab
initio, and of no eect whatsoever;
"B Declaring that Original Certificate of Title No. 735 found on page 136 Vol. A-7 of the Registration
Book of Rizal is null and void from the very beginning (and) of no eect whatsoever;
"C Declaring that all Transfer Certificates of Title emanating or allegedly derived from Original
Certificate of Title No. 735 of the Province of Rizal are likewise null and void;
"D Declaring that the plaintis in Civil Cases Nos. 3621, 3622 and 3623 are the owners and entitled
to the possession of the parcels of land claimed and described in paragraph V of their respective
complaints;
"E Ordering the defendants and all persons claiming under them to vacate and restore to the plaintis
the possession of the parcels of land described in paragraph V of the complaint in Civil Case No. 3621
and indicated as Parcel A, Parcel B and Parcel C, in SWO-40187 (Exh. "UU" and Exh. VV");
"F Ordering the defendants and all persons claiming under them to vacate and restore to the plaintis
the possession of the parcels of land described in paragraph V of the complaint, in Civil Case No. 3622
and indicated as Parcel D and Parcel F in SWO-40187 (Exh. "UU" and Exh. VV");
"G Ordering the Defendants and all persons claiming under them to vacate and restore to the plaintis
the
For August 18, 2017 possession of the parcels of land described in paragraph V of the complaint in Civil
Case No. 3623 and indicated as Parcel E, in SWO-491187 (Exh. "UU and Exh. VV");
"H Ordering the defendants to pay to plaintis in Civil Case No. 3621 the sum of P600.00 a month as
actual damages for uncollected rentals from 1951 until such possession is restored to them;
"I Ordering the defendants to pay the plaintis in Civil Case No. 3622 the sum of P600.00 a month, as
actual damages for uncollected rentals from 1951 until such possession is restored to them;
"J Ordering the defendants to pay the plaintis in Civil Case No. 3623 the sum of P150.00 a month as
actual damages for uncollected rentals from 1951 until such possession is restored to them;
"K Ordering the defendants to pay the costs;
"L The defendants' counterclaim is hereby declared dismissed for lack of merit."
A motion for new trial was filed by defendant J.M. Tuason & Co., Inc. on January 30, 1965. However,
before the motion for new trial was resolved by the court, said defendant, on February 11, 1965, filed a
notice of appeal to this Court and an appeal bond, and on February 12, 1965 he filed the record on
appeal. 7 The record on appeal, after it had been corrected and amended, as ordered and/or authorized
by the trial court, was approved on September 29, 1965.
Appellant J.M. Tuason & Co. Inc., in this appeal, contends that the trial court committed the following
errors:
I. The lower court erred in holding that the Land Registration Court in GLRO No. 7681 lacked or was
without jurisdiction to issue decree No. 17431 for the alleged reason that:
(1) The amendment to the original plan was not published;
(2) The description of Parcel 1 in the decree is not identical with the description of Parcel 1 as
applied for and as published in the Ocial Gazette;
(3) Parcel 1 as decreed is bigger in area than Parcel 1 as applied for;
(4) A. Bonifacio Road is the only boundary on the West of Parcel 1.
!58 of 105!
II. The trial court erred in finding that the transcription of the decree No. 17431 was not in accordance
with the law and that. therefore, said OCT 735 was a complete nullity and the land remains unregistered.
III. The trial court erred in taking cognizance of these cases despite its lack of jurisdiction to hear and
decide the same.
IV. The trial court erred in not dismissing these cases on the grounds of prescription and laches, and in
denying the motions to dismiss filed on said grounds.
V. The trial court erred in not dismissing these cases on the ground of res judicata and in denying the
motion to dismiss filed on said ground.
VI. The trial court erred in declaring null and void all certificates of title emanating from OCT 735.
VII. The trial court erred in holding that J.M. Tuason & Co., Inc. is not a purchaser in good faith and for
value.
VIII. The trial court erred in awarding ownership of the lands claimed by, and in awarding damages to,
the appellees.
IX. The trial court erred in denying and in dismissing appellant's counterclaim and in sentencing appellant
to pay the costs of these suits.
As stated by the trial court in its decision, "These cases involve the validity of the decision and the decree
issued in LRC No. 7681 resulting in the issuance of Original Certificate of Title No. 735, and the ownership
and possession of several parcels of land, claimed by the plaintis in their respective complaints . . . .
The lower court, summarizing its findings, among others, concluded that: (1) the decision and the decree
in LRC No. 7681 are null and void ab initio, having been rendered by a court without jurisdiction; (2)
Original Certificate of Title No. 735 issued pursuant to the decree in LRC No. 7681 is null and void, having
been issued pursuant to a void decree; (3) Original Certificate of Title No. 735 is null and void because
the Decree No. 17431 in LRC No. 7681, assuming the decree to be valid, had not been inscribed in
accordance with the provisions of Section 41 of Act 496; (4) all Transfer Certificates of Title allegedly
emanating and derived from the void Original Certificate of Title No. 735 are likewise null and void; and
(5) the plaintis in these three civil cases are the owners and entitled to the possession of the parcels of
land described in their respective complaints.
For August 18, 2017
We have carefully examined and studied the voluminous records, and the numerous documentary
evidence, of these three cases, and We find that the conclusions of the trial court are not supported by
the evidence and the applicable decisions of this Court.
The Original Certificate of Title No. 735 that had been declared null and void ab initio by the trial court
covers two big parcels of land, mentioned in said title as Parcel 1, having an area of 8,778,644.10 square
meters more or less, known as the Santa Mesa Estate; and Parcel 2, having an area of 15,961,246
square meters more or less, known as the Diliman Estate. The three parcels of land involved in Civil
Case No. 3621, having an aggregate area of 278,853 square meters, more or less; the two parcels of
land involved in Civil Case No. 3622 having an aggregate area of 154,119.7 square meters, more or less;
and the one parcel of land involved in Civil Case No. 3623, having an area of 62,481 square meters,
more or less, are all included in the area of Parcel 1. 9 The trial court, in its decision, states that the
identity of the parcels of land claimed by the plaintis is not disputed, and that both the plaintis and the
defendant admit that the parcels of land litigated are found within the boundaries of the present Sta. Mesa
Heights Subdivision (Parcel 1) covered by Original Certificate of Title No. 735. 10 It is shown in the survey
plans, presented by both the plaintis and the defendant, that the six parcels of lands involved in these
three cases are located at the northwestern portion of Parcel 1. (Exhs. UU, VV; and Exh. 29).
The records show, and it is established by the evidence, that sometime in 1911 Mariano Severo Tuason
y de la Paz, Teresa Eriberta Tuason y de la Paz, Juan Jose Tuason y de la Paz, Demetrio Asuncion
Tuason y de la Paz, and Augusto Huberto Tuason y de la Paz, filed with the Court of Land Registration
an application for the registration of their title over two parcels of land, designated in the survey plans
accompanying the application as Parcel 1 with an area of 8,798,617 square meters, and Parcel 2 with an
area of 16,254,037 square meters. The application was docketed as LRC No. 7681. There was another
application covering three other parcels of land, docketed as LRC No. 7680. The application in LRC No.
7681 was set for hearing on November 20, 1911 (Exh. X). The application and the notice of hearing,
containing the technical descriptions of the two parcels of land applied for, were published in the issue of
the Ocial Gazette of October 25, 1911 (Exh. YY). On November 20, 1911 the Court of Land Registration
issued an order of general default against the whole world except the Insular Government, the Director
of Lands and the municipalities of Caloocan and San Juan del Monte (Exh. 28). On December 23, 1911
the court issued an order authorizing the amendment of the
!59 of 105!
plan in LRC No. 7681 (Exh. 23). On November 11, 1913 the applicants and the Government entered into
an agreement whereby the Government agreed to withdraw its opposition to the application for
registration of title over the portion known as Hacienda Diliman (Parcel 2) on condition that the roads
existing on said tract of land be allowed to remain, and it was further agreed "that the issuance of the title
to applicants shall be made subject to all the exceptions established by Section 39 of Act 496 as amended
by Section 1 of Act 2011" (Exh. 21). On December 29, 1913 the Court of Land Registration rendered a
decision (Exh. 24) in both LRC No. 7680 and LRC No. 7681 which, among others, stated that during the
registration proceedings the plans accompanying the two applications were amended in order to exclude
certain areas that were the subject of opposition, that the order of general default was confirmed, that the
Chief of the Surveyor's Division of the Court of Land Registration was ordered to submit a report as to
whether or not the new (amended) plans had included lands which were not covered by the original plans,
and whether or not the new plans had excluded the lands that had already been covered by the decree
in LRC No. 3563. The decision further stated that in the event that the new plans did not include new
parcels of land and that the lands that were the subject of the proceedings in LRC No. 3563 had been
excluded, an additional decision would be made decreeing the adjudication and registration of the lands
that were the subject of the registration proceedings in favor of the applicants, as follows: To Mariano
Severo Tuason y de la Paz, two sixths (2/6) undivided portion; to Teresa Eriberta Tuason y de la Paz,
one sixth (1/6) undivided portion; to Juan Jose Tuason y de la Paz, one sixth (1/6) undivided portion; to
Demetrio Asuncion Tuason y de la Paz, one sixth (1/6) undivided portion; and to Augusto Huberto Tuason
y de la Paz, one sixth (1/6) undivided portion.
In compliance with the order contained in the decision of December 29, 1913, the Chief of the Survey
Division of the Court of Land Registration, on January 24, 1914, submitted a report (Exh. 22) to the court
which, among others, stated that the new plan of Parcel 1 in LRC No. 7681 did not include any land that
had not been previously included in the original plan.
On March 7, 1914 the Court of Land Registration rendered a supplemental decision declaring that, on
the basis of the decision of December 29, 1913 and of the report of the Surveyor of Court of Land
Registration, the applicants Mariano Severo Tuason y de la Paz and others were the owners of the land
applied for, as described in the amended plan, in the proportion mentioned in the decision, and ordering
that the land applied for be registered in the names of the
For August 18, 2017 applicants and that a decree of registration be issued in accordance with the decision
and the amended plan. On March 27, 1914 the Chief of the Survey Division addressed a communication
to the registration court, in connection with LRC No. 7681, suggesting that the decision of the court of
March 7, 1914 be modified such that the decree of registration he based upon the original plan as
published and not upon the amended plan (Exh. Z-3). The Court of Land Registration did not follow the
recommendation of the Chief of the Survey Division. On July 6, 1914 Decree of Registration No. 17431
was issued by the Chief of the General Land Registration Oce pursuant to the decision of the Court of
Land Registration of March 7, 1914 in LRC No. 7681. The decree contains the technical description of
the two parcels of land in accordance with the plan as amended. It appears in the decree that Parcel 1
has an area of 8,798,644.10 square meters more or less, or an increase of 27.10 square meters over the
area of 8,798,617 square meters that was stated in the application for registration and in the notice of
hearing which were published in the Ocial Gazette of October 25, 1911; and that Parcel 2 has an area
of 15,961,246 square meters, more or less, or a decrease of 292,791 square meters from the area of
16,254,037 square meters that was stated in the application and in the notice of hearing that were
published in the Ocial Gazette (Exhs. 25 and YY). All in all, there is a decree of 292,763.90 square
meters in the aggregate area of the two parcels of land sought to be registered.
Subsequently, on July 8, 1914, the Register of Deeds of the province of Rizal issued Original Certificate
of Title No. 735 in the names of the applicants, Mariano Severo Tuason y de la Paz, Teresa Eriberta
Tuason y de la Paz, Juan Jose Tuason y de la Paz, Demetrio Asuncion Tuason y de la Paz, and Augusto
Huberto Tuason y de la Paz (Exh. 30).
1. We, shall now deal with the first error assigned by the appellant.
The lower court declared Original Certificate of Title No. 735 null and void ab initio because, according
to said court, that title was based on Decree of Registration No. 17431 in LRC No. 7681 that was null
and void, said decree having been issued pursuant to a decision of the Court of Land Registration in LRC
No. 7681 which had no jurisdiction to render said decision.
As We have adverted to, Original Certificate of Title No. 735 covers two big parcels of land: Parcel 1,
known as the Santa Mesa Estate, and Parcel 2, known as the Diliman Estate. The records show that
these two parcels of land had been subdivided into numerous lots, and most of those lots had been sold
to numerous parties Parcel 1 having been converted into a
!60 of 105!
subdivision known as the Santa Mesa Heights Subdivision, and the lots had been sold to private
individuals and entities, such that in that subdivision now are located the National Orthopedic Hospital,
the station of Pangasinan Transportation Co. (Pantranco), Sto. Domingo Church, Lourdes Church and
others. Necessarily, as a result of the sales of the lots into which Parcel 1 was subdivided, transfer
certificates of title were issued to the purchasers of the lots, and these transfer certificates of title were
based upon transfer certificates of title that emanated from Original Certificate of Title No. 735. The trial
court declared null and void all transfer certificates of title emanating, or derived, from Original Certificate
of Title No. 735.
The decision of the trial court declaring null and void ab initio Original Certificate of Title No. 735 would
invalidate the title over the entire area included in Parcel 1 which admittedly includes the six parcels
of land claimed by the plaintis and also the title over the entire area included in Parcel 2. Let it be
noted that Parcel 1 has an area of 8,798,644.10 square meters, more or less, and Parcel 2 has an area
of 15,961,246 square meters, more or less; while the six parcels of land claimed by the plaintis have an
aggregate area of only 495,453.7 square meters, more or less. In other words, the area of the six parcels
of land claimed by the plaintis is only a little over two per cent (2%) of the aggregate area of Parcel 1
and Parcel 2. But the decision of the trial court nullified Original Certificate of Title No. 735, without any
qualification.
The trial court held that the Court of Land Registration had no jurisdiction to render the decision in LRC
No. 7681 because during the registration proceedings, after the original application and notice of hearing
had been duly published, the plan of Parcel 1 was amended and no publication regarding the amended
plan was made. The trial court pointed out that the area and the description of Parcel 1 in Decree of
Registration No. 17431 are not identical with the area and description of Parcel 1 applied for and
published in the Ocial Gazette. The trial court stressed on the point that publication is one of the
essential bases of the jurisdiction of the court to hear and decide an application for registration and to
order the issuance of a decree of registration, as provided in Act 496 (Land Registration Act).

We believe that the lower court erred when it held that the Land Registration Court was without jurisdiction
to render the decision in LRC No. 7681. Under Section 23 of Act 496, the registration court may allow, or
order, an amendment of the application for registration when it appears to the court that the amendment
is necessary and proper. Under Section 24 of the same act the court may at any time order an application
to be amended by
For August 18, 2017 striking out one or more parcels or by severance of the application. The amendment
may be made in the application or in the survey plan, or in both, since the application and the survey plan
go together. If the amendment consists in the inclusion in the application for registration of an area or
parcel of land not previously included in the original application, as published, a new publication of the
amended application must be made. The purpose of the new publication is to give notice to all persons
concerned regarding the amended application. Without a new publication the registration court can not
acquire jurisdiction over the area or parcel of land that is added to the area covered by the original
application, and the decision of the registration court would be a nullity insofar as the decision concerns
the newly included land. 11 The reason is because without a new publication, the law is infringed with
respect to the publicity that is required in registration proceedings, and third parties who have not had
the opportunity to present their claim might be prejudiced in their rights because of failure of notice. 12
But if the amendment consists in the exclusion of a portion of the area covered by the original application
and the original plan as previously published, a new publication is not necessary. 13 In the latter case,
the jurisdiction of the court over the remaining area is not aected by the failure of a new publication.
In the case at bar We find that the original plan covering Parcel 1 and Parcel 2 that accompanied the
application for registration in LRC No. 7681 was amended in order to exclude certain areas that were the
subject of opposition, or which were the subject of another registration case; and the Chief of the Survey
Division of the Court of Land Registration was ordered to determine whether the amended plan included
lands or areas not included in the original plan. In compliance with the order of the registration court said
Chief of the Survey Division informed the court that no new parcels were included in the new (or
amended) plan. Thus, in the decision of the Court of Land Registration in LRC Nos. 7680 and 7681,
dated December 29, 1913 (Exh. 24), We read the following:
"Despues de las notificaciones y avisos de las dos solicitudes en ambos expedientes, se enmerdaron
los planos unidos los mismos para excluir ciertas porciones que habian sido objeto de oposicion." . . .
"POR TANTO, ratificando como por la presente se ratifica la declaracion de rebeldia general, se ordena:
"1.o Que el Jefe de la Division de Agrimensores de este Tribunal terreno que no haya sido comprendido
en los planos originales . . ."
!61 of 105!
On January 24, 1914 the Chief of the Survey Division of the Court of Land Registration made a report to
the court (Exh. 22), from which report We read the following:
"Cumpliendo lo mandado por el Tribunal en el No. 1 de la parte dispositiva de su Decision de fecha 29
de Diciembre proximo pasado, el que suscribe, despues de un detenido estudio de los planos unidos los
Expedientes arriba citados, tiene el honor de informar:
"1.o Que los nuevos planos presentados por los solicitantes corresponden a las parcelas 1.a 2.a, y 3.a,
del Expediente No. 7680 y la 1.a parcela del No. 7681, que son las mismas que se refiere el plano
Exhibito A del No. 7680.
xxx xxx xxx
"4. Que los nuevos planos presentados de las parcelas 1.a, 2.a y 3.a del Expediente 7680, y de la 1.a
del 7681 no incluyen terreno alguno que no haya sido comprendido en los planos originales.
And so, in the supplemental decision of the Court of Land Registration in LRC No. 7681, dated March 7,
1914 (Exh. 24-A), the report of the Chief of the Survey Division was taken into consideration and the
court ordered the registration of the lands applied for by the applicants as described in the amended plan
("como esta descrito en el plano enmendado"). It is thus shown that the amended plan in LRC No. 7681
did not cover parcels, or areas, that were not previously included in the original plan which accompanied
the application that had been published in the Ocial Gazette. There was, therefore, no necessity for a
new publication of the amended plan in order to vest the Court of Land Registration with jurisdiction to
hear and decide the application for registration in LRC No. 7681 and to order the issuance of Decree of
Registration No. 17431 upon which Original Certificate of Title No. 735 was based.
Way back in 1933, this Court had occasion to rule on the validity of the very same Original Certificate of
Title No. 735 which the trial court had declared null and void in the three cases now before this Court. In
the case of the Bank of the Philippine Islands vs. Acua (59 Phil. 183) the validity of Original Certificate
of Title No. 735 was assailed by the appellants (Pascual Acua and others) precisely upon the ground
that during the registration proceedings, which brought about the issuance of Original Certificate of Title
No. 735, the original plan of the applicants was ordered amended, and no new publication was made of
the amended plan and so it was urged that the registration court did not have jurisdiction to order the
issuance of the decree of registration in favor of the applicants. The action in this
For August 18, 2017 case was instituted by the Bank of the Philippine Islands as receiver of the Tuason
Entail for the purpose, among others, of recovering from Pascual Acua and others certain lands included
in the Santa Mesa and Diliman hacienda located in the barrios of Bagobantay and Diliman, in the
municipalities of Caloocan and San Juan del Monte, Province of Rizal. Upon hearing the Court of First
Instance of Rizal declared that none of the defendants owned any part of the land in controversy. On
appeal, this Court observed that the character in which the plainti sued was not open to question, and
the material facts were as follows: The heirs of the Tuason estate, referred to as the Tuason Entail, held
a Torrens title to a tract of land with an area of about 1,600 hectares located in the province of Rizal. This
property was then covered by Transfer Certificate of Title No. 3792 issued in lieu of older certificates
dating from July 8, 1914. This Transfer Certificate of Title No. 3792 emanated from Original Certificate of
Title No. 735. 17 The appellants precisely sought to nullify the title of the heirs of the Tuason estate,
which emanated from Original Certificate of Title No. 735, upon the ground, as now urged by the
appellees in the three cases at bar, that during the registration proceedings the original plan of the lands
known as the Sta. Mesa and Diliman estates was amended, and no publication was made of the amended
plan. Regarding the question of the non-publication of the amended plan, this Court said:
"Among the arguments made by the appellants of the Bagobantay group, it is alleged that the Torrens
title relied upon by the plainti is void, and in support of this contention it is stated that, during the course
of the registration proceedings, an order was made by the court for the amendment of the original plan
of the applicants and that this order was not followed by new publication, wherefore, it is supposed the
court was without jurisdiction to decree the title to the applicants. In this connection reliance is placed
upon the doctrine stated in the Philippine Manufacturing Co. vs. Imperial (49 Phil. 122). But the brief for
the appellants fails to call attention to the fact that the rule stated in the case cited has reference to an
amendment of the plan by which additional land, dierent from that included in the original survey, is
intended to be brought within the process of registration. In the case before us, the order referred to was
for the exclusion of certain portions of the land covered by the original survey, and the doctrine of the
case cited cannot apply. Apart from this it does not appear that the portion intended to be excluded
comprehended any part of the land which had been usurped."
The appellees, however, asserts that the case of the Bank of the Philippine Islands vs. Acua, supra, is
not applicable to the three cases now before this Court
!62 of 105!
because what was involved in said case was Parcel 2 of Original Certificate of Title No. 735, and not
Parcel 1 which is the land involved in these cases. This assertion of the appellees is not correct. The
decision in that case states that the action was instituted by the Bank of the Philippine Islands, as receiver
of the Tuason Entail, for the purpose, among others, of recovering from Pascual Acua and others
"certain lands contained in the Sta. Mesa and Diliman Hacienda located in the barrios of Bagobantay and
Diliman in the municipalities of Caloocan and San Juan del Monte." 19 But what matters is the doctrine
that was laid down by this Court in that case, that is: that when the original survey plan is amended, after
the publication of the application in order to include land not previously included in the original survey, a
new publication of the amended plan is necessary in order to confer jurisdiction upon the registration
court to order the registration of the land that is added to what was included in the original survey plan.
The ruling of this Court in the Bank of the Philippine Islands case has a decisive application in the three
cases now before this Court.
The trial court laid stress on the point that publication of the amended plan of Parcel 1 should have been
made because it appears in the Decree of Registration No. 17431, and as reproduced in Original
Certificate of Title No. 736, that the area of said parcel is "bigger" than the area stated in the application
as published in the Ocial Gazette; and, also, that the boundaries of Parcel 1 stated in the decree are
not identical with the boundaries stated in the application as published in the Ocial Gazette. We paid
particular attention on this point of the lower court's decision, and our impression is that the trial court had
exploited certain minor discrepancies between the description of Parcel 1 in the decree of registration
and its description in the original application, in order to bolster its ruling that "to render a decision on the
amended plan, boundary descriptions, and additional lands comprised within Parcel 1 in Decree No.
17431, a republication of such amended plan, boundary description, technical description and additional
areas is necessary to confer jurisdiction upon the Court.
Oddly enough, when the lower court said that the area of Parcel 1 in the decree of registration is bigger
than the area of Parcel 1 in the application as published, it did not mention the fact that the dierence in
area is only 27.10 square meters. We believe that this dierence of 27.10 square meters is too minimal
to be of decisive consequence in the determination of the validity of Original Certificate of Title No. 735.
It was error on the part of the lower court to lay stress on this circumstance and made it a basis for ruling
that because in the amended plan there is this increase in
For August 18, 2017 area as compared to the area appearing in the application as published, the Land
Registration Court did not have jurisdiction to render the decision decreeing the registration of Parcel 1
in LRC No. 7681. The Chief of the Survey Division of the Court of Land Registration, in his report to the
court of January 24, 1914 (Exh. 22), stated that the new plan of Parcel 1 did not include any land that
was not included in the original plan. That report was made precisely in compliance with the order of the
registration court, in the decision of December 29, 1913 in LRC No. 7681, to inform the court "si los
nuevos planos incluyen o no terreno que no haya sido comprendido en los planos originales". That report
was submitted by the Chief Surveyor "despues de un detenido estudio de los planos unidos a los
expedientes". Under the foregoing circumstances, our inference is that the area of 27.10 square meters
was already included in the original plan, and that the computation of the area in the original survey must
have been inaccurate; and the error was corrected in the recomputation of the area when the amended
plan was prepared. We made a careful study and comparison of the technical description of Parcel 1
appearing in the application as published, and the technical description appearing in Decree of
Registration No. 17431 (Exhs. 19, 19-A and Z-6), and We accept the explanation of counsel for the
appellant that this seeming increase of 27.10 square meters had been brought about "by the fact that
when the amendment of the plan was made, the distances and bearings in a few points along the
southwestern boundary (Please see Exh. 19) were brought to the nearest millimeter and to the nearest
second respectively; whereas, the computation of the survey in the original plan was to the nearest
decimeter and to the nearest minute only". 21 We believe that this very slight increase of 27.10 square
meters would not justify the conclusion of the lower court that "the amended plan .. included additional
lands which were not originally included in Parcel 1 as published in the Ocial Gazette." It being
undisputed that Parcel 1 has an area of more than 8,798,600 square meters (or 879.86 hectares), We
believe that this dierence of 27.10 square meters, between the computation of the area when the original
plan was made and the computation of the area when the amended plan was prepared, can not be
considered substantial as would aect the identity of Parcel 1.
Moreover, no evidence was presented to identify this area of 27.10 square meters, nor to show its
location, in relation to the entire area of Parcel 1. The appellees did not even attempt to show that this
excess area of 27.10 square meters is included within the parcels that they are claiming. We cannot,
therefore, consider this area of 27.10 square meters as an area that was separate and distinct from, and
was added to, the land that was
!63 of 105!
covered by the original survey plan, such that the publication of the amended plan would be necessary
in order that the registration court could acquire jurisdiction over that area. As We have pointed out, this
increase of 27.10 square meters was simply the result of the recomputation of the area when the original
plan was amended. There is no showing that the recomputation is incorrect. Neither is there a showing
that this small area of 27.10 square meters belongs to any person and that person had been deprived of
his property, or had failed to claim that particular area because of the non-publication of the amended
plan. On the other hand, there is the report of the Chief of the Survey Division of the Court of Land
Registration (Exh. 22) stating that the amended plan of Parcel 1 in LRC No. 7681 did not include any
land which was not included in the original plan.
It is the settled rule in this jurisdiction that only in cases where the original survey plan is amended during
the registration proceedings by the addition of lands not previously included in the original plan should
publication be made in order to confer jurisdiction on the court to order the registration of the area that
was added after the publication of the original plan.
The settled rule, further, is that once the registration court had acquired jurisdiction over a certain parcel,
or parcels, of land in the registration proceedings in virtue of the publication of the application, that
jurisdiction attaches to the land or lands mentioned and described in the application. If it is later shown
that the decree of registration had included land or lands not included in the original application as
published, then the registration proceedings and the decree of registration must be declared null and void
insofar but only insofar as the land not included in the publication is concerned. This is so, because
the court did not acquire jurisdiction over the land not included in the publication the publication being the
basis of the jurisdiction of the court. But the proceedings and the decree of registration, relating to the
lands that were included in the publication, are valid. Thus, if it is shown that a certificate of title had been
issued covering lands where the registration court had no jurisdiction, the certificate of title is null and
void insofar as it concerns the land or lands over which the registration court had not acquired jurisdiction.
And so in the three cases now before this Court, even granting that the registration court had no
jurisdiction over the increased area of 27.10 square meters (as alleged by appellees), the most that the
lower court could have done was to nullify the decree and the certificate of title insofar as that area of
27.10 square meters is concerned, if that area can be identified. But certainly, the lower court could not
declared, and
For August 18, 2017 should not have declared, null and void the whole proceedings in LRC No 7681;
and, certainly, the lower court erred in declaring null and void ab initio Original Certificate of Title No. 735
which covers not only the supposed excess area of 27.10 square meters but also the remaining area of
8,798,617 square meters of Parcel 1 and the entire area of 15,961,246 square meters of Parcel 2. The
trial court, in its decision, declared Original Certificate of Title No. 735 null and void from the very
beginning and of no eect whatsoever' without any qualification. This declaration by the lower court, if
sanctioned by this Court and given eect, would nullify the title that covers two big parcels of land (Parcels
1 and 2) that have a total area of 24,759,890.10 square meters, or almost 2,476 hectares. And not only
that. The trial court declared null and void all transfer certificates of title that are derived, or that emanated,
from Original Certificate of Title No. 735, regardless of whether those transfer certificates of title are the
results of transactions done in good faith and for value by the holder of those transfer certificates of title.
It must be noted that the appellees in the present cases claim six parcels that have an area of some
495,453.7 square meters (about 49.5 hectares), whereas the combined area of Parcel 1 and Parcel 2 is
24,759,890.10 square meters (about 2,476 hectares). It must also be noted that both Parcel 1 and Parcel
2 have been subdivided into numerous lots (Exhs. 14 and 14-B) which have already been acquired by
numerous persons and/or entities that are now holding certificates of title which can be traced back to
Original Certificate of Title No. 735. The decision of the lower court, however, would render useless
Original Certificate of Title No. 735 and all transfer certificates of title emanating, or derived, therefrom.
The decision of the lower court would certainly prejudice the rights of the persons, both natural and
juridical, who had acquired portions of Parcel 1 and Parcel 2, relying on the doctrine of the indefeasibility
of Torrens title. The decision of the lower court would, indeed, prejudice the rights of persons who are
not parties in the present cases. And this is so, because the trial court, in its decision, did not adhere to
the applicable decisions of this Court in resolving the pertinent issues in these cases.
Another reason mentioned by the lower court to support its ruling that Decree of Registration No. 17431
is null and void is that the description of Parcel 1 in the decree of registration is dierent from the
description of the same parcel in the notice of hearing of the original application for registration as
published in the Ocial Gazette. The dierent description that appears in the decree of registration,
according to the lower court, is an amendment to the Original survey plan that
!64 of 105!
accompanied the application and the amended survey plan should have been republished; and because
there was no such republication the registration court was without jurisdiction to issue the decree of
registration. The lower court also committed an error in making this ruling. We find that the lower court
incorrectly laid stress on dierences in the names of the owners, and on dierences in the designations,
of the lands that adjoin Parcel 1 along its southwestern boundary. We find, however, that these
dierences are well explained in the record.
In the notice of hearing in LRC No. 7681 (Exhibits YY and YY-2) the boundaries of Parcel 1 are stated
as follows:
"Bounded on the N. by property of Rosario Negrao and others (Maysilo Estate); E. by the San Juan River;
SW. by Parcel 3, properties of Benito Legarda, Hospital de San Juan de Dios, by Parcel 2, Santa Clara
Monastery, by Parcel 1; and W. by a road, Cementerio del Norte and the Roman Catholic Church
As described in Decree of Registration No. 17431 (Exh. 25), the boundaries of Parcel 1 are as follows:
"PARCEL 1. Bounded on the N. by property of Rosario Negrao y Escobar, et al., (Maysilo Estate): On
the E. by San Juan River; on the SW. by properties of Mariano Severo Tuason y de la Paz, et al., Benito
Legarda, Hospital de San Juan de Dios and C.W. Rosenstock & Co.; and on the W. by a road, Cementerio
del Norte and property of the Roman Catholic Church . . .
It will thus be noted that the boundaries of Parcel 1 on the northern, eastern, and western sides, as they
appear in the notice of hearing that was published and in Decree of Registration No. 17431, are the same.
It is in the southwestern boundary where there appear some dierences in the names of the owners, or
in the designations, of the adjoining lands. Thus, in the published notice of hearing, it appears that the
names of the owners, or the designations, of the lands that bound Parcel 1 (of LRC No. 7681) on the
Southwest are parcel 3, properties of Benito Legarda, Hospital de San Juan de Dios, parcel 2, Monasterio
de Santa Clara and parcel 1; while in the decree of registration it appears that the lands that bound Parcel
1 (of LRC No. 7681) on the Southwest are the properties of Mariano Severo Tuason y de la Paz, et al.,
Benito Legarda, Hospital de San Juan de Dios and C.W. Rosenstock & Co. Upon a careful examination
of the records, We find that the lands that adjoin Parcel 1 at its southwestern boundary, as indicated in
the notice of hearing that was published in the Ocial Gazette, are the same lands that are indicated in
the decree of registration as the lands that adjoin Parcel 1 at its southwestern boundary. There is
For August 18, 2017 simply a change in the names of the owners or in the designations, of the lands. We
find that parcels 3, 2 and 1, appearing as the boundary lands on the southwestern side of Parcel 1 in
LRC No. 7681, as published, are in fact parcels of land that are owned, and had been applied for
registration, by Mariano Severo Tuason y de la Paz, et al. in LRC No. 7680. This LRC No. 7680 was
heard and decided jointly with LRC No 7681 by the Land Registration Court (Exh. 24). These parcels 3,
2 and 1 of LRC No. 7680, being lands owned by Mariano Severo Tuason y de la Paz, et al., it may as
well be stated in the decree of registration that those lands on the southwestern side of Parcel 1 in LRC
No. 7681 are the properties of Mariano Severo Tuason y de la Paz, et al., instead of designating them
as parcel 3, parcel 2, and parcel 1 (of LRC 1680) And so, what appears in Decree of Registration No.
17431 as the properties of Mariano Severo Tuason y de la Paz, et al., at the southwestern side of Parcel
1 are no other than those very parcels 3, 2 and 1 that appear in the notice of hearing as the lands that
bound Parcel 1 on the southwest.
In the description of Parcel 1 as published, it appears that one of the boundaries on the southwestern
side is Santa Clara Monastery, while in the decree of registration the words "Santa Clara Monastery" do
not appear but, instead, are replaced by the words "C. W. Rosenstock & Co." It will be remembered that
during the registration proceedings the plan of Parcel 1 was ordered amended, and the surveyor who
prepared the amended plan must have found that what used to be the property of the Santa Clara
Monastery at the time of the original survey was already the property of C. W. Rosenstock & Co. when
the amended plan was prepared. This can simply mean that there was a change of ownership from Santa
Clara Monastery to C.W. Rosenstock & Co. It must be considered that the original survey took place from
December, 1910 to June, 1911 (Exhibits 8 and 19), while the registration case was decided on March 7,
1914.
Under Section 40 of Act 496, the decree of registration "shall contain a description of the land as finally
determined by the court." Evidently, the Court of Land Registration acted in consonance with this
provision of the law when, in its decision in LRC 7681, it took into consideration the actual description of
Parcel 1 as shown in the amended survey plan, and when it disregarded the recommendation of the
Chief of the Survey Division, dated March 27, 1914, that the decision of the court of March 7, 1914 "be
based upon the original plans, as published, and not upon the amended plan." It may well be said that
Decree of Registration No. 17431 simply contains the correct area of Parcel 1 and the correct names of
the owners of the lands that bound Parcel 1 in LRC No. 1681 as of the
!65 of 105!
time when the decision of the land registration court was rendered.
In this connection, the following pronouncement of this Court in the case of Domingo vs. Ongsiako, 55
Phil. 361, 373-4, is pertinent:
"We may further observe that underlying the contention of the plaintis is the idea that errors in the plans
nullify the decrees of registration. This is erroneous. It is the land and not the plan which is registered.
Prior to the enactment of Act No. 1875, practically all plans for land registration were defective especially
in regard to errors of closures and areas, but so far no such errors have been permitted to aect the
validity of the decrees. If the boundaries of the land registered can be determined, the technical
description in the certificate of title may he corrected without cancelling the I decree. Such corrections
have been made in this case by approved surveys which embrace all of the land here in question. To
nullify and cancel final decrees merely by reason of faulty technical descriptions would lead to chaos.
We have taken note of the fact that the six parcels of land that are claimed by the plaintis in the three
cases now before this Court are on the northwestern portion of Parcel 1 (parcels labelled A, B, C, D, E
and F, in Exh. UU; and Exhs. 17, 29 and 29-B). They are far from the southwestern boundary. The
circumstance, therefore, regarding the dissimilarity in the names of the owners, or the designations, of
the lands that adjoin the southwestern side of Parcel 1 is of no moment insofar as the lots claimed by
appellees are concerned. What matters is that the lots claimed by the appellees are included in Parcel 1
of LRC No. 1681 and are located at the northwestern portion of said Parcel 1. Indeed, it was error on the
part of the lower court to make as one of the bases in declaring Decree of Registration No. 17431 and
Original Certificate of Title No. 735 null and void and of no eect whatsoever the aforestated dissimilarities
in the names of the owners, or in the designations, of the lands on the southwestern side of Parcel 1,
because those dissimilarities are well explained in the records of these cases.
The lower court committed still another error when it made the finding that the only boundary of Parcel 1
on the western side is "A. Bonifacio road" and then declared that the lands situated west of the A.
Bonifacio road were never the subject of the registration proceedings in LRC No. 7681. The lower court
declared the lands west of A. Bonifacio road as unregistered lands and awarded the ownership of those
lands to the plaintis in Civil Cases Nos. 3621 and 3622 (appellees in G.R. Nos. L-26127 and L-26128).
This finding of the lower court is contrary to the
For August 18, 2017 evidence presented by the parties in these cases. Both the appellees and the
appellant submitted as their evidence the notice of hearing of the application as published in the Ocial
Gazette (Exhibit X, YY and YY-2; and Exhibit 26) and the decree of registration No. 17431 (Exhibit Y,
and Exh. 25) wherein are clearly stated that the boundaries of Parcel 1 on the West are:
(1) a road, (2) Cementerio del Norte and (3) Roman Catholic Church (Exhs. Z-6, UU, and Exhs. 6, 18, 19
and 20). But the lower court considered the A. Bonifacio road as the only boundary on the West, and
ignored the two other boundaries on the West that are mentioned both in the notice of hearing as
published and in the decree of registration. The sketches and the survey plans, forming part of the
evidence on record, show that the road, labelled as "A. Bonifacio", goes alongside the western boundary
of Parcel 1 (separating Parcel 1 and the Cementerio del Norte), until it reaches a point where it traverses
the northwestern portion of Parcel 1, such that from the point where it enters the area of Parcel 1 what is
left as the boundaries on the western side are the Cementerio del Norte and the Roman Catholic Church
(Exhibits UU, W, 17, 19 and 29). Ignoring the existence of the Cementerio del Norte and the Roman
Catholic Church as the other boundaries of Parcel 1 on the West, the lower court declared that the lands
west of the A. Bonifacio road, which form part of the lands that are claimed by the plaintis in Civil Cases
Nos. 3621 and 3622, are outside the boundary of Parcel 1 on the west and that those particular areas
had remained as unregistered lands and are not covered by Original Certificate of Title No. 735. This
finding of the lower court is contrary to the very admission of the appellees in these three cases that all
the lands (six parcels in all) that they claim are included in the area of Parcel 1 mentioned in Original
Certificate of Title No. 735. In paragraph XIV of the original, as well as in the amended complaint, in each
of these three cases, the plaintis alleged that the lands that they claim "had either been fraudulently or
erroneously included .. in Parcel 1 (known as Santa Mesa Estate) of the Original Certificate of Title No.
735 of the Land Records of the Province of Rizal." 24 In their appeal brief, the appellees categorically
stated that "Both the appellees and the appellant admit that these parcels of land claimed by the plaintis
in these three (3) civil cases are located within Parcel 1 (Santa Mesa Estate) covered by Original
Certificate of Title No. 735". 25 In the pre-trial order of the lower court of December 18, 1957, it was
stated that the parcels of land litigated in these cases are portions of the lands covered by OCT No. 735.
26 The lower court itself, at the earlier part of its decision, stated that "both the plaintis and the
defendants admit that the parcels of land litigated in Civil Cases Nos. 3621, 3622 and 3623 are found
within the boundaries of the present Santa Mesa Heights Subdivision covered by Original
!66 of 105!
Certificate of Title No. 735" 27 The appellees in these two cases had never asserted that part of the lands
that they claim are outside the boundaries of Parcel 1, nor did they assert that part of the lands that they
claim have remained unregistered and not covered by Original Certificate of Title No. 735. The lower
court had made a finding not only contrary to the evidence of the appellees but even more than what the
appellees asked when it said in its decision that the western boundary of Parcel 1 is only the A. Bonifacio
road and that the lands claimed by the appellees west of this road had never been registered. This Court
certainly can not give its approval to the findings and rulings of the lower court that are patently erroneous.
2. The lower court also erred when it declared Original Certificate of Title No. 735 null and void upon the
ground that the decree of registration was not transcribed in the Registration Book in accordance with
the provisions of Section 41 of Act 496. In its decision, the lower court said:
"During the trial, the Book of Original Certificate of Title was brought to the Court. The Court had occasion
to see and examine the `ENTRY' made in the Registration Book. The Court found that the Face of the
Title which, under ordinary circumstances, should be Page 1 is found as Page 2. The sheet containing
the technical description which should be page 2 is Page 1. The FACE of the Title, which should have
been Page 1, contained the last portion of the description of the land described in the decree. The sheet
containing the bulk of the description of the lands decreed should have been Page 2. The so-called
Original Certificate of Title No. 735 found on Page 138, Book A-7 of the Register of Deeds of Rizal is,
therefore, null and void because the provisions of Section 41 of the Land Registration Law have not been
complied with. Said Section requires that the entry in the Registration Book must be a transcription of the
Decree and the paging should consist of a leaf or leaves in consecutive order . . ." 28 The pertinent
provisions of Section 41 of Act 496 reads, as follows:
"SEC. 41. Immediately after final decision by the court directing the registration of any property, the clerk
shall send a certified copy of such decision to the Chief of the General Land Registration Oce, who
shall prepare the decree in accordance with section forty of Act numbered four hundred and ninety-six,
and he shall forward a certified copy of said decree to the register of deeds of the province or city in which
the property is situated. The register of deeds shall transcribe the decree in a book to be called the
"Registration Book' in which a leaf, or leaves in consecutive order, shall be devoted exclusively to each
title. The entry made by the register of deeds in this book in each case shall be
For August 18, 2017 the original certificate of title, and shall be signed by him and sealed with the seal
of his oce. . . ."
The pertinent provisions of Section 40 of Act 496 reads, as follows:
"SEC. 40. Every decree of registration shall bear the day of the year, hour, and minute of its entry, and
shall be signed by the clerk. It shall state whether the owner is married or unmarried, and if married, the
name of the husband or wife. If the owner is under disability, it shall state the nature of the disability, and
if a minor, shall state his age. It shall contain a description of the land as finally determined by the court,
. . . The decree shall be stated in a convenient form for transcription upon the certificates of title hereinafter
mentioned.
Section 29 of Act 496 provides that as soon as the decree of title has been registered in the oce of the
register of deeds, as provided in Section forty-one, the property included in said decree shall become
registered land under the Act. Section 42 of Act 496 provides that the certificate shall take eect upon
the date of the transcription of the decree.
This Court has held that as defined in Section 41 of Act 496, the certificate of title is the transcript of the
decree of registration made by the register of deeds in the registry.
The appellant presented as evidence a photostat of Original Certificate of Title No. 735, as found in the
Registration Book in the oce of the register of deeds of Rizal (Exhibit 50). 30 We have examined this
document very carefully, and We find that it is a copy of the original that satisfies all the requirements of
a valid Torrens title as provided for in Sections 40 and 41 of Act 496.
On the face, or on the first page, of this title, there is the certification of the Chief of the Land Registration
Oce that the decree of registration was registered in Manila on July 6, 1914 at 7:41 a.m.; and the
certification of the Register of Deeds of Rizal that the decree was received for transcription in his oce
an July 8, 1914 at 3:30 P .M. It is also stated on the face of this title that it was entered pursuant to Decree
No. 17431 of the Court of Land Registration, dated at Manila on the 7th day of March 1914, in Case No.
7681 of said court. The names of the declared owners, their civil status, their spouses if married, and
their respective interest or share in the lands covered by the title are stated on the face of this title. We
have noted that the technical descriptions of the lands (Parcels 1 and 2) covered by the title are copied
on the sheets constituting the title. We have compared the technical descriptions of Parcels 1 and 2 as
they appear on this photostat of Original Certificate of Title No. 735 (Exhibit
!67 of 105!
50) with the technical descriptions of these lands as they appear in the decree of registration (Exhibit Y
for the plaintis, and Exhibit 25 for the defendant), and We find that the technical descriptions appearing
on the title are the complete and faithful reproduction, or transcription, of the technical descriptions
appearing in the decree of registration.
We have noted what the lower court found, that the technical descriptions of Parcels 1 and 2 do not begin
on the face, or on the first page, of this title, as a technical description is ordinarily copied on the certificate
of title. What appears on the face of this title is the last part of the technical description of Parcel 2. The
technical descriptions of Parcels 1 and 2 begin on the second page and end on the first page. This
circumstance, that is, that the technical descriptions of Parcels 1 and 2 do not begin on the face, or on
the first page, of the title, is the basis of the lower court in ruling that the decree of registration was not
transcribed in the registration book in accordance with Section 41 of Act 496, and so Original Certificate
of Title No. 735 is null and void. We have noted, however, that in its decision the lower court made no
mention that in the transcription of the decree in the registration book any of the data that is required in
Section 40 of Act 496 to be included had been omitted. We have also noted and this fact is undenied
that the technical descriptions of Parcels 1 and 2 as they appear in Decree of Registration No. 17431
are fully and faithfully transcribed on the photostat of Original Certificate of Title No. 735 (Exhibit 50).
There is no showing that the manner of transcribing the decree, as it appears on that photostat, was done
for a fraudulent purpose, or was done in order to mislead. Considering that the decree of registration is
fully transcribed in the Registration Book, and also as copied in Original Certificate of Title No. 735, the
circumstance that the beginning of the technical descriptions is not found on the face, or on the first page,
of Original Certificate of Title No. 735 is not a ground to nullify the said certificate of title. We agree with
the lower court that the transcription of the technical descriptions should begin, or should have been
started, on the face, or on the first page, of the title. We hold, however, that the fact that this was not so
done in the case of Original Certificate of Title No. 735 should not be taken as a factor in determining the
validity of Original Certificate of Title No. 735. This defect in the manner of transcribing the technical
descriptions should be considered as a formal, and not a substantial, defect. What matters is that the
original certificate of title contains the full transcription of the decree of registration, and that the required
data provided for in Section 40 of Act 496 are stated in the original certificate of title. The lower court
made a literal construction of the provisions of Section 41 of Act 496 and strictly applied its construction
in the determination
For August 18, 2017 of the validity of Original Certificate of Title No. 735. We believe that the provisions
of Section 41 of Act 496 should be interpreted liberally, in keeping with Section 123 of said Act which
provides that "This Act shall be construed liberally so far as may be necessary for the purpose of eecting
its general intent." If We adopt a literal construction of the provisions of Section 41 of Act 496, as was
done by the lower court, such that the defect in the manner or form of transcribing the decree in the
registration book would render null and void the original certificate of title, then it can happen that the
validity or the invalidity of a certificate of title would depend on the register of deeds, or on the personnel
in the oce of the register of deeds. The register of deeds, or an employee in his oce, can wittingly or
unwittingly render useless a decree of registration regularly issued pursuant to a decision of a registration
court and thus nullify by the error that he commits in the transcription of the decree in the Registration
Book an original certificate of title that has been existing for years. This strict interpretation or construction
of Section 41 of Act 496 would certainly not promote the purpose of the Land Registration Law (Act 496),
which generally are: to ascertain once and for all the absolute title over a given landed property 31 ; to
make, so far as it is possible, a certificate of title issued by the court. to the owner of the land absolute
proof of such title 32 ; to quiet title to land and to put a stop forever to any question of legality of title 33 ;
and to decree that land title shall be final, irrevocable and indisputable.
We, therefore, hold that the formal defect in the transcription of Decree of Registration No. 17431 in the
Registration Book did not render null and void Original Certificate of Title No. 735. Consequently, We
declare that the two parcels of land (Parcel 1 which includes the lands claimed by the appellees, and
Parcel 2) covered by Original Certificate of Title No. 735 are properly registered under the Torrens System
of registration.
3. The principal issue that has to be resolved in the present appeal is whether or not the lower court had
correctly declared that "Original Certificate of Title No. 735 . . . is null and void from the very beginning
and of no eect whatsoever.
In the preceding discussions, We have held that the lower court erred when it declared null and void
Original Certificate of Title No. 735. We have found that the registration proceedings that brought about
the decree of registration upon which was based the issuance of Original Certificate of Title No. 735 were
in accordance with the provisions of Act 496, as amended. We have held that the Land Registration Court
that ordered the issuance of the decree of registration had jurisdiction to hear and decide the
!68 of 105!
application for registration filed by Mariano Severo, Teresa Eriberta, Juan Jose, Demetrio Asuncion, and
Augusto Huberto, all surnamed Tuason y de la Paz. The records show that the notice of hearing of the
application, which embodied the technical descriptions of the two parcels of land (Parcel 1, known as the
Sta. Mesa Estate, and Parcel 2, known as the Diliman Estate), was duly published as required by law.
The records show that the hearing on the application was regularly held, and that the registration court
had seen to it that no land which was not included in the original survey plan and not covered by the
original application was made the subject of the registration proceedings. We have found that the decree
of registration was properly issued by the Land Registration Oce pursuant to the decision of the Land
Registration Court, and that said decree of registration was fully transcribed in the Registration Book in
the oce of the Register of Deeds of the province of Rizal. We have found also that the six parcels of
land that are claimed by the appellees in the three cases now before Us are all included in Parcel 1 that
is covered by Original Certificate of Title No. 735.
In view of Our findings and conclusion that Original Certificate of Title No. 135 was issued in accordance
with the provisions of Act 496, and that the six parcels of land that are claimed by the appellees in the
present cases are covered by said certificate of title, what is left for this Court to decide is whether or not
the appellees still have any legal right over the six parcels of land that they claim.
Let it be noted that, as maintained by counsel for the appellees, the action of the appellees is principally
to recover the ownership and possession of the six parcels of land mentioned and described in their
complaints. The appellees would accomplish their objective through alternative ways: (1) secure the
nullification of the decision of the Land Registration Court in LRC No. 6781, the nullification of the Decree
of Registration No. 17431 and the nullification of Original Certificate of Title No. 735; (2) if they fail in their
eorts to secure the desired nullifications, with Original Certificate of Title No. 735 being considered valid
and eective, they seek the reconveyance to them by the defendants named in their complaints, including
herein appellant J.M. Tuason & Co., Inc., of the six parcels of land that they claim; and (3) if they cannot
secure a reconveyance, they seek to secure payment to them by the defendants named in their
complaints of the actual value of the six parcels of land that they claim.
It appears to Us that the appellees are not sure of their stand, or have not adopted a definite stand, in
asserting the rights that they claim.
For August 18, 2017
It is the settled rule that a party seeking the reconveyance to him of his land that he claims had been
wrongly registered in the name of another person must recognize the validity of the certificate of title of
the latter. It is also the rule that a reconveyance may only take place if the land that is claimed to be
wrongly registered is still registered in the name of the person who procured the wrongful registration. No
action for reconveyance can take place as against a third party who had acquired title over the registered
property in good faith and for value. And if no reconveyance can be made, the value of the property
registered may be demanded only from the person (or persons) who procured the wrongful registration
in his name.
The lower court accepted, and sustained, the assertion of the appellees that the proceedings in LRC No.
7681 of the Court of Land Registration were null and void and that Original Certificate of Title No. 735 is
null and void ab initio and of no eect. The trial court even went to the extent of declaring that some of
the parcels of land claimed by the appellees in Civil Cases Nos. 3621 and 3622 (now G.R. Nos. L-26127
and L-26128 before this Court) were not covered by Original Certificate of Title No. 735. The lower court
forthwith declared the appellees the owners of the parcels of land claimed by them, as described in their
complaints. Strangely enough, the lower court, upon declaring Original Certificate of Title No. 735 null
and void, did not make any statement, or observation, regarding the status or situation of the remaining
lands (Parcels 1 and 2) covered by Original Certificate of Title No. 735 after adjudicating to the appellees
the six parcels of land claimed by them in their complaints.
In the present appeal counsel for the appellees had maintained, and has endeavored to show, that the
lower court was correct in annulling Original Certificate of Title No. 735 and in adjudicating in favor of the
appellees the ownership and possession of the six parcels of land claimed by them in their complaints.
But, as hereinbefore held by Us, the lower court erred in declaring Original Certificate of Title No. 735
void and of no eect. We have held that Original Certificate of Title No. 735 was issued as a result of the
registration proceedings in LRC No. 7681 which was regular and that said certificate of title is valid and
eective. The proceedings in LRC 7681 being in rem, the decree of registration issued pursuant to the
decision rendered in said registration case bound the lands covered by the decree and quieted title
thereto, and is conclusive upon and against all persons, including the government and all the branches
thereof, whether mentioned by name in the application, notice or citation, or included in the general
inscription "To whom it may concern", and such decree will not be
!69 of 105!
opened by reason of the absence, infancy, or other disability of any person aected thereby, nor by any
proceedings in any court for reversing judgment or decree. Such decree may only be reopened if any
person deprived of land or of any estate or interest therein by decree of registration obtained by fraud
would file in the competent court of first instance a petition for review within one year after entry of the
decree, provided no innocent purchaser for value had acquired an interest on the land, and upon the
expiration of said period of one year, the decree, or the certificate of title issued pursuant to the decree,
is incontrovertible (Sec. 38, Act 496). In the case now before Us, the Decree of Registration No. 17431
in LRC 7681 was entered on July 8, 1914. It is undisputed that no person had filed any petition for review
of the decree of registration in LRC 7681 within the period of one year from July 8, 1914. That decree of
registration, and Original Certificate of Title No. 735 issued pursuant thereto, therefore, had been
incontrovertible since July 9, 1915.
Moreover, innocent purchase. 9 for value had acquired interest in the lands covered by Original Certificate
of Title No. 735.
The Original Certificate of Title No. 735 was issued on July 8, 1914 in the names of the original applicants
for registration, namely, Mariano Severo Tuason y de la Paz, Teresa Eriberta Tuason y de la Paz, Juan
Jose Tuason y de la Paz, Demetrio Asuncion Tuason y de la Paz, and Augusto Huberto Tuason y de la
Paz. Herein appellant J.M. Tuason & Co., Inc. is not one of those who were registered as the original
owners mentioned in Original Certificate of Title No. 735. When the original complaints were filed in these
three cases in the Court of First Instance of Rizal the Parties named defendants in each of the three
cases were Mariano Severo Tuason y de la Paz, Teresa Eriberta Tuason y de la Paz, Juan Jose Tuason
y de la Paz, Demetrio Asuncion Tuason y de la Paz, Augusto Huberto Tuason y de la Paz, the heirs of
each one of these defendants (without naming them), and J.M. Tuason & Co., Inc. Of all the defendants
named in the three complaints only defendant J.M. Tuason & Co., Inc. appeared and filed its answer to
the complaints. All the other defendants did not appear, and so they were all declared in default. 38 It
had to happen that way because as of the time when the three complaints were filed on May 19, 1955
the ownership of Parcel 1 that was originally covered by Original Certificate of Title No. 735 had already
passed to defendant J.M. Tuason & Co., Inc. In fact this defendant had caused Parcel 1 to be subdivided
and had sold the subdivision lots.
The records show that Parcel 1 in Original Certificate of Title No. 735 was part of the properties of the
For August 18, 2017
Mayorasgo Tuason (Tuason Entail) which became involved in a litigation in the Court of First Instance of
Manila. 39 During the pendency of the case the properties of the Mayorasgo Tuason were administered
by the Bank of the Philippine Islands as the judicial receiver. In the order of the Court of First Instance of
Manila, dated May 5, 1938, in Civil Case No. 24803, the Bank of the Philippine Islands, as receiver, was
authorized, directed and ordered to execute, upon payment to it of the sum of P763,925.75, a deed of
transfer and assignment in favor of the Heirs of D. Tuason, Inc. of the property covered by Transfer
Certificate of Title No. 31997, which was originally Parcel 1 included in Original Certificate of Title No.
735 (Exh. 13-B). On June 13, 1938 the receiver Bank of the Philippine Islands executed the deed of
transfer and assignment (Exh. 13-A). Transfer Certificate of Title No. 34853 of the Register of Deeds of
Rizal was forthwith issued in the name of the Heirs of D. Tuason, Inc. (Exhs. 12- b and 36). The deed of
transfer and assignment was approved by the court in an order dated June 17, 1938. This conveyance
to the Heirs of D. Tuason, Inc. took place at a time when the Supreme Court had already decided the
case of Bank of the Philippine Islands vs. Acua (59 Phil. 183) wherein this Court upheld the validity of
Original Certificate of Title No. 735 and also the validity of the transfer certificate of title emanating
therefrom.
The circumstances attending the acquisition by the Heirs of D. Tuason, Inc. of the land covered by
Transfer Certificate of Title No. 31997 which was formerly Parcel 1 covered by Original Certificate of
Title No. 735
clearly indicate that said corporation acquired its title in a regular transaction as purchaser in good
faith and for value. On June 15, 1938 the Heirs of D. Tuason, Inc. in turn sold the same property to J.M.
Tuason & Co., Inc., and Transfer Certificate of Title No. 35073 was issued in the name of the latter (Exhs.
12-c and 37).
The lower court declared that herein appellant J.M. Tuason & Co., Inc. was a purchaser in bad faith. We
do not find any evidence in the record that would sustain such a finding of the lower court. One reason
given by the lower court in declaring appellant J.M. Tuason & Co., Inc. a purchaser in bad faith is the fact
that the incorporators of the Heirs of D. Tuason, Inc. and the incorporators of J. M. Tuason & Co., Inc.
were practically the same persons belonging to the same Tuason family. We do not see anything wrong
if some incorporators of the Heirs of D. Tuason Inc. are also incorporators of J.M. Tuason & Co., Inc.
During these days when businesses are promoted, operated, and managed, through corporate entities,
it is not surprising to see two or more corporations organized by the same persons or group of persons,
with dierent purposes,
!70 of 105!
for dierent lines of business and with distinct or separate assets and interests. Besides, as has been
shown, the Heirs of D. Tuason, Inc. acquired the land (Parcel 1 in Original Certificate of Title No. 735)
from the Bank of the Philippine Islands, the receiver of the properties of the Mayorasgo Tuason, in a sale
that was authorized, and subsequently approved, by the court. The Heirs of D. Tuason, Inc. paid the sum
of P763,950.80 for the property. Certainly if the Heirs of D. Tuason, Inc. had acquired the land originally
covered by Original Certificate of Title No. 735 in a transaction that was authorized by the court, for a
valuable consideration, thereby acquiring a good title over the property as a purchaser in good faith and
for value, the title that it transferred to J. M. Tuason & Co., Inc. when it sold same property to the latter
was also a good title, and J.M. Tuason & Co., Inc. was also a purchaser in good faith and for value
even if it appears that the incorporators of the two corporations belong to the same Tuason family. The
records of these cases are bereft of any evidence which would indicate that the sale of Parcel 1 in
question by the Heirs of D. Tuason, Inc. to J. M. Tuason & Co., Inc. was fraudulent.
Another reason given by the lower court in declaring appellant J.M. Tuason & Co., Inc. a buyer in bad
faith is that when said appellant bought Parcel 1 originally covered by Original Certificate of Title No. 735
it was aware of the fact that the appellees or their predecessors in interest were in possession of, and
were cultivating, the six parcels of land that they now claim in these cases. The conclusion of the lower
court is too strained. It should be remembered that the registered property bought by J.M. Tuason & Co.,
Inc. had an area of some 879 hectares. It could happen that certain relatives or ancestors of appellees
had been squatting on some portions of the land and claimed certain areas as their own, to the extent of
having the areas claimed by them declared for taxation purposes in their names. Thus the appellees
presented in evidence tax declarations that appear to have taken eect as of 1941. We have noted,
however, that at the back of those tax declarations are written the words "This parcel is a duplicate of the
land under Tax No. 764-J. M. Tuason & Co., Inc." (Exhs. E-Alcantara, F-Alcantara, FF-1-Benin, GG-
Benin, HH-Benin BBB-Pili, and BBB,1-Pili). 41 These annotations simply reveal that when the
predecessors of the appellees had those tax declarations made to cover the lands that they claim, those
lands were already included in the tax declaration of appellant J. M. Tuason & Co., Inc. Appellant J. M.
Tuason & Co., Inc. had been exercising, and asserting, its proprietary rights over the land in question
after it bought the same from the Heirs of D. Tuason, Inc. 42 This is borne by the statement in the order,
dated September 26, 1955, issued by Judge Juan P. Enriquez who at the time was presiding the
For August 18, 2017 branch of the Court of First Instance of Rizal where these three cases were pending,
as follows:
"3. It having been shown that J. M. Tuason & Co. had title covering the land in question which they are
subdividing into small lots for sale and in view of the observation under paragraph 2 hereof the Court
finds that there is no justifiable reason to maintain the writ of preliminary injunction that has been issued.
This is particularly true in Civil Case No. 2622, defendants having secured a final judgment against
plaintis Juan Alcantara and Jose Alcantara for ejectment before the Municipal court of Quezon City; and
such injunction would annul the order of the execution issued by the Quezon City courts. It should be
noted that the herein plaintis at the beginning pleaded to the Court that the area on which their respective
houses stand be not touched and their possession thereof be respected by defendant J.M. Tuason & Co.
In other words, each plainti is merely asking for about 250 square meters each which represents the
land on which the house stands and their immediate yard, and not the whole land covered by these three
cases or 68 hectares. On the other hand, the Court requires J. M. Tuason & Co. to put up a bond of
P2,000 in favor of each of the defendant (sic) to answer for whatever damages he may suer by reason
of the continuance during the action of the acts complained of.
Besides, the possession by the appellees, either by themselves or through their predecessors in interest,
if there was such possession at all, would be unavailing against the holder of a Torrens certificate of title
covering the parcels of lands now in question. From July 8, 1914 when Original Certificate of Title No.
735 was issued, no possession by any person of any portion of the lands covered by said original
certificate of title, or covered by a subsequent transfer certificate of title derived from said original
certificate of title, could defeat the title of the registered owner of the lands covered by the certificate of
title. In this connection, let it be noted that appellant J. M. Tuason & Co, Inc. became the registered owner
of Parcel 1, which was originally covered by Original Certificate of Title No. 735, only on June 15, 1938,
or almost 24 years after Original Certificate of Title No. 735 was issued.
It can well be said that J. M. Tuason & Co., Inc. had relied on the title of the Heirs of D. Tuason, Inc. when
it bought the land covered by Transfer Certificate of Title No. 34853, and the Heirs of D. Tuason, Inc.
likewise had relied on the title of the Mayorasgo Tuason (Mariano Severo Tuason y de la Paz, et al.)
when it bought the land covered by Transfer Certificate of Title No. 31997 from the judicial receiver, duly
authorized and approved by the court. We, therefore, can not
!71 of 105!
agree with the lower court when it declared appellant J. M. Tuason & Co., Inc. a purchaser on bad faith.
The evidence shows that appellant J. M. Tuason & Co., Inc. had converted the land originally covered by
Original Certificate of Title No. 735, including the six parcels claimed by appellees into a subdivision, and
numerous persons and entities had purchased the subdivision lots, and the purchasers in turn were
issued transfer certificates of title covering the lots that they bought, based on the transfer certificate of
title in the name of J. M Tuason & Co., Inc. The buyers of the lots necessarily relied upon the certificate
of title in the name of J. M. Tuason & Co., and because they paid for the lots they certainly are purchasers
in good faith and for value. The purchasers of these lots have built thereon residential houses, oce
buildings, shops, hospital, even churches. But the lower court, disregarding these circumstances,
declared null and void all transfer certificates of title that emanated, or that were derived, from Original
Certificate of Title No. 735. This is a grave error committed by the lower court. And the error is
compounded when the lower court ordered appellant J. M. Tuason & Co., Inc. and all those claiming
under said appellant, to vacate and restore to the appellees the possession of the parcels of lands that
are claimed by them in the present cases. The possessors of the lots comprised within the six parcels of
land in question, and who hold certificates of title covering the lots that they bought, are not parties in the
present cases, and yet the decision of the lower court would annul their titles and compel them to give
up the possession of their properties. To give eect to the decision of the lower court is to deprive persons
of their property without due process of law. 44 The decision of the lower court would set at naught the
settled doctrine that the holder of a certificate of title who acquired the property covered by the title in
good faith and for value can rest assured that his title is perfect and incontrovertible.
In view of the foregoing discussions, it is obvious that the action of the appellees in the three cases now
before this Court must fail.
It has been shown that appellant J. M. Tuason & Co., Inc. had acquired a valid title over the land which
includes the six parcels that are claimed by the appellees. The fact, that the predecessors in interest of
the appellees or any person, for that matter had not filed a petition for the review of the decree of
registration in LRC No. 7681 within a period of one year from July 8, 1914 when the decree of registration
was issued, is a circumstance that had forever foreclosed any proceeding for the review of said decree.
As We have adverted to, that decree of registration had become incontrovertible. An action, similar to
one
For August 18, 2017 brought by the appellees in each of the present cases, which attack collaterally the
said decree of registration cannot be entertained. 46 Neither may the action of the appellees for
reconveyance of the lands in question be entertained because such action bad already prescribed, and
barred by laches, considering that Original Certificate of Title No. 735 had been issued way back in 1914
and the complaint in the present cases were filed only on May 19, 1955, or after a lapse of some 41
years. Moreover, as of the time when these complaints were filed the six parcels of land claimed by the
appellees are no longer covered by the certificate of title in the names of the persons who procured the
original registration of those lands. The title to Parcel 1, which includes the six parcels of land claimed by
the appellees, had passed to the hands of parties who were innocent purchasers for value. This Parcel
1 which was one of the two parcels originally covered by Original Certificate of Title No. 735, was
subsequently covered by Transfer Certificate of Title No. 31997. As has been shown, this Parcel 1 was
part of the properties of the Mayorasgo Tuason and it was conveyed by order of the court in Civil Case
No. 24803 of the Court of First Instance of Manila to the Heirs of D. Tuason, Inc., and the latter in turn
conveyed the same to J. M. Tuason & Co., Inc. Transfer Certificate of Title No. 34853 in the name of the
Heirs of D. Tuason, Inc. was cancelled and transfer Certificate of Title No. 35073 was issued in the name
of J. M. Tuason & Co., Inc. It has also been shown that J. M. Tuason & Co., Inc. had converted Parcel 1
to a subdivision. Numerous persons and entities bought those subdivision lots, and to those buyers were
issued transfer certificates of title covering the lots that they acquired. It is very clear, therefore, that an
action for reconveyance cannot prosper against appellant J. M. Tuason & Co., much less against the
registered owners of the lots that form parts of the six parcels of land that are claimed by the appellees.
Neither may the appellees have a cause of action for damages against appellant J. M. Tuason & Co.,
Inc., considering that said appellant is not one of the original registered owners that procured the
registration of the land. There is no evidence that J. M. Tuason & Co., Inc. had anything to do with the
registration proceedings which brought about the issuance of Original Certificate of Title No. 735 even
supposing that the registration was procured fraudulently.
4. Numerous cases have been decided by this Court, dealing on questions regarding the validity and
eectiveness of Original Certificate of Title No. 735. The rulings of this Court in those cases are
necessarily relevant to, and of decisive hearing in, the resolution of the issues involved in the three cases
now at bar.
72! of 105!
(a) We have earlier cited the case of the Bank of the Philippine Islands vs. Acua (59 Phil., 183),
where the jurisdiction of the Court of Land Registration that issued the decree which was the basis of
Original Certificate of Title No. 735 was questioned, and this Court upheld the jurisdiction of the
registration court and categorically pronounced the validity of Original Certificate of Title No. 735.
(b) There is the case of Jose Alcantara, et al., versus Mariano Tuason y de la Paz, et al. (G.R. No.
L-4998, Mar. 13, 1953, 92 Phil. 796), where this Court declared that Original Certificate of Title No . 735
is incontrovertible and is conclusive against all persons claiming, either by themselves or by their
predecessors in interest, rights over the lands covered by said certificate of title.
We find that the Alcantara case is intimately related to the three cases at bar, and the rulings of this Court
in that former case are of decisive application to these three cases.
On August 29, 1950 a complaint was filed in the Court of First Instance of Rizal (Quezon City Branch) by
Jose Alcantara, Elias Benin, Pascual Pili, Alejandro de Dios, Tomas Bagagonio, Quintina Sandoval, and
Tomasa Lazaro against Mariano Tuason y de la Paz, Heirs of Mariano Tuason, J. M. Tuason & Co., Inc.
and Gregorio Araneta, Inc. This case was docketed as Civil Case No. Q-156. It will be noted that three
of the plaintis in Civil Case No. Q-156, namely, Jose Alcantara, Elias Benin, and Pascual Pili, are among
the original plaintis in the three cases now before this Court; Elias Benin, in Civil Case No. 3621; Jose
Alcantara, in Civil Case. No. 3622; and Pascual Pili, in Civil Case No. 3623. Jose Alcantara, Elias Benin
and Pascual Pili, as plaintis in that Civil Case No. Q-156 claimed that they were the lawful owners of six
(of the ten) parcels of land described in paragraph 2 of their complaint - Jose Alcantara claiming two
parcels, Elias Benin claiming three parcels, and Pascual Pili claiming one parcel. Substantially, it is
alleged in the complaint 48 that each plainti, by himself and by his predecessors in interest, as lawful
owner, had been in the actual, open and continuous possession of his own respective parcel, or parcels,
of land from time immemorial until January 1950 when the defendants by force and by the use of armed
men started to convert their lands into a subdivision; that on July 8, 1914 the defendants had obtained
Original Certificate of Title No. 735 over a parcel of land which included the lands possessed by them
(plaintis) and which they and their ancestors had been enjoying as owners, for more than thirty years
before the issuance of the title; that the silence and inaction of the defendants since the date of their
original certificate of title showed that said certificate of
For August 18, 2017 title did not express the status of the their claim to the said parcels, that plaintis
were not given formal notice by the defendants of the registration of the lands, such that defendants'
certificate of title No. 735 was not in accordance with law, and that defendants did not have proper title
for registration to the parcels of land owned by the plaintis, as described in the complaint; and that
because the certificate of title issued by the register of deeds was still in the names of the defendants,
successors in interest of the Tuasons y de la Paz, and has not passed to innocent parties for valuable
consideration, the conveyance of the same to the plaintis was in order. The plaintis prayed that therein
defendants be ordered to execute deeds of conveyance of the parcels of land described in their complaint
in favor of the plaintis that the defendants' certificate of title be cancelled and the corresponding
certificate be ordered issued in the names of the plaintis. We quote from the decision:
"The material allegations of the complaint are: that plaintis are owners of the parcels of land set forth in
their complaint, which parcels are situated along Bonifacio street, barrio of San Jose, Quezon City, and
that they have been in actual, open, and continuous possession and enjoyment thereof without
molestation from defendants from time immemorial to the present; that on July 8, 1914, defendants
obtained a certificate of title (No. 735) over a parcel of land, which included the lands possessed by
plaintis, and which they and their ancestors had been enjoying as owners more than 30 years before
the issuance of said title; that on June 23, 1950, defendants caused the removal of two houses of plaintis
on the land; and that defendants did not file any action against plaintis before the inclusion of the lands
in their title, in violation of the `due process of law' clause of the Constitution. There are other allegations
which really are arguments of legal discussion, thus: that defendants could not acquire title by the
registration proceedings against the lawful holder, especially without formal notice, because registration
is to confirm title, not to acquire it; that the silence of the defendants since the issuance of their title shows
that this does not express the lawful status of their claim, etc. The defendants moved to dismiss the
complaint on the ground that it states no cause of action and that, if it does, the same is barred by the
statute of limitations. The court sustained this motion on the second ground. Subsequently, plaintis filed
an amended complaint with the same substantial allegations, but with new ones, i.e., that it was in
January, 1950, that they learned that their lands were included in the registration proceedings which
culminated in the issuance of defendants' title; that defendants never claimed ownership to the lands, but
directly or indirectly allowed plaintis to continue exercising their rights of ownership over the same. This
!73 of 105!
amended complaint was denied admission, and the motion for the reconsideration of the order of
dismissal was also denied. Hence the appeal.
In arming the order of the lower court dismissing the complaint, this Court held:
"Without considering whether the trial court's refusal to admit the amended complaint is erroneous or not,
we are constrained to hold that the dismissal of the action, even with the amended complaint is a basis
thereof, is correct. From the allegations of both the original and amended complaints, it appears that the
defendants are holders of a certificate of title issued on July 8, 1914 as a consequence of registration
proceedings. There is no allegation in both original and amended complaints that the plaintis were not
notified, or were not aware, of the registration proceedings. It is presumed, therefore, that as occupants
proper notices thereof were served on them and that they were aware of said proceedings. If this is so,
then the plaintis, who were, or whose predecessors in interest were, on the land during the registration
proceedings, were bound by said proceedings. The latter are in rem and bind the whole world, whether
served with notice personally or not. (Grey Alba vs. De la Cruz, 17 Phil. 49). And the decree of registration,
in pursuance of which defendants' title was issued, binds the land and quiets title thereto, and is
conclusive against the plaintis, (Section 38, Land Registration Act). The supposed right of plaintis by
reason of their alleged continued possession for thirty years was, therefore, destroyed fully and
completely by the registration proceedings, and their supposed ignorance of the inclusion of the lands
can not exclude them from the eects of the registration proceedings, and the supposed conduct of
defendants in allowing plaintis to continue on the land after registration can not serve as basis of any
title or right thereto, because acts of a possessory character by tolerance of an owner does not constitute
possession (Article 1942, Spanish Civil Code), and because no title to registered land in derogation to
that of the registered owner shall be acquired by prescription or adverse possession (Section 46, Land
Registration Act).
Thus, in the Alcantara case, as in the Bank of the Philippine Island vs. Acua case, supra, this Court
upheld the validity of the registration proceedings which culminated in the issuance of Original Certificate
of Title No. 735. This Court declared that "the decree of registration, in pursuance of which defendants'
title was issued, binds the land and quiets title thereto and is conclusive against the plaintis." In other
words, in virtue of that decision, the plaintis in Civil Case No. Q-156, among them Jose Alcantara, Elias
Benin and Pascual Pili, and their successors-in-interest, could no
For August 18, 2017 longer question the validity of Original Certificate of Title No. 735, nor claim any right
of ownership over any portion of the land that is covered by said certificate of title.
But Elias Benin, Jose Alcantara, and Pascual Pili again came to court to claim ownership over portions
of the land covered by Original Certificate of Title No. 735. On May 19, 1955 Elias Benin, joined by his
brother Victor Benin and his sister Marta Benin, filed Civil Case No. 3621; Jose Alcantara joined by his
brother Juan Alcantara, filed Civil Case No. 3622; and Pascual Pili, joined by his sister Luisa Pili, filed
Civil Case No. 3623. These are the three cases which originated in the Court of First Instance of Rizal
(Quezon City Branch) which are now before this Court on appeal.
In the earlier part of this decision, We have pointed out that the complaints in these three cases had been
amended so as to include as parties plaintis all the heirs of the persons who were alleged to be the
owners of the parcels of land claimed by the plaintis in each case. Thus, the complaint in Civil Case No.
3621 was amended to include all the heirs of Sixto Benin the alleged owner of the three parcels of land
described in the complaint and the common predecessor in interest of all the plaintis in the case. The
complaint in Civil Case No. 3622 was amended to include all the heirs of Bonoso Alcantara, the alleged
owner of the two parcels of land described in the complaint and the common predecessor in interest of
all the plaintis in the case. The complaint in Civil Case No. 3623 was amended to include all the heirs
of Candido Pili, the alleged owner of the one parcel of land described in the complaint and the common
predecessor in interest of all the plaintis in the case.
In those three cases, in the court below, herein appellant J.M. Tuason & Co., Inc. (defendant therein)
filed a motion to dismiss upon the principal ground "that the cause of action (assuming there is one) is
barred by prior judgment, or by the statute of limitation". In its motion to dismiss J.M. Tuason & Co., Inc.
contended that the decision of the Supreme Court in the Alcantara case is a bar to the action of the
plaintis in Civil Cases Nos. 3621, 3622 and 3623 of the Court of First Instance of Rizal. The lower court,
however, denied the motion to dismiss. In its answer to the complaint in each of these three cases, J.M.
Tuason & Co., Inc. set up as armative defenses the very grounds of its motion to dismiss. After the
plaintis had closed their direct evidence, J.M. Tuason & Co., Inc. filed another motion to dismiss upon
the ground that the action was barred by the statute of limitations and by a prior judgment, and that the
plaintis had not presented evidence to prove their
!74 of 105!
claim of ownership. This second motion to dismiss was also denied by the lower court.
In its decision, which is now on appeal before this Court, the lower court held that the decision in the
Alcantara case was not a bar to the action in these three cases, ruling that there is no identity, of the
parties, of the subject matter, and of the cause of action, between Civil Case No. Q-156, on the one hand,
and Civil Cases Nos. 3621, 3622, and 3623, on the other.
It is now contended by appellant J.M. Tuason & Co. Inc., in the present appeal, that "the trial court erred
in not dismissing these cases on the ground of res judicata and in denying the motion to dismiss filed on
said ground."
Does the judgment in the aforementioned Alcantara case operate as a bar to the action of the appellees
in the three cases at bar?
In order that the rule of res judicata may apply, the following requisites must be present: (a) the former
judgment must be final; (b) it must have been rendered by a court having jurisdiction of the subject-matter
and of the parties; (c) it must be a judgment on the merits; and (d) there must be, between the first and
the second actions, identity of parties, of subject-matter, and of cause of action (San Diego vs. Cardona,
70 Phil. 281-283).
We find that the judgment in Civil Case No. Q-156 (G.R. No. L-4998) is a final judgment on the merits
that was rendered by a court having jurisdiction over the subject matter and over the parties. The only
requisite for res judicata which we have to determine is whether between Civil Case Q-156 (G.R. No.
4998), on the one hand. and Civil Cases Nos. 3621, 3622 and 3623 (G.R. Nos. L-26127, 26128 and
26129), on the other, there is identity of parties, of subject matter and of cause of action.
In our examination of the records and the evidence, We find that there is identity of subject matter. In the
lower court's pre-trial order, dated December 18, 1957, which was based on the agreement of the parties,
it is stated "That the parcels of land in litigation in Case No. Q-156 are substantially identical to the same
parcels of land litigated in these cases Nos. 3621, 3622 and 3623." 51 We also find that there is identity
of cause of action. It is apparent, upon reading the original complaint (Exhibit 1) in Civil Case Q-156 and
the decision in the Alcantara case (G.R. No. L-4998), that the cause of action in Civil Case Q-156 was
based on the alleged fact that the defendants had dispossessed and deprived the plaintis therein of the
parcels of land
For August 18, 2017 described in the complaint, which were claimed by the plaintis as their own and of
which they had been in actual, open and continuous possession from time immemorial, and that said
lands were wrongly included in Certificate of Title No. 735 that was obtained by the defendants. In the
three cases at bar, plaintis (now appellees) also complain of having been dispossessed and deprived
by the defendants of the parcels of land of which they were absolute owners and possessors, by
themselves and through their predecessors in interest, since time immemorial and that their said lands
wrongly included in Parcel 1 of Original Certificate of Title No. 735 that was obtained by the defendants.
In Civil Case No. Q-156, on the one hand, and in the three cases now at bar, on the other, the plaintis
therein seek the nullification of Original Certificate of Title No. 735, and the reconveyance to them of the
parcels of land that they claim as theirs. 52 It appears clear to Us that in Civil Case No. Q-156 and in the
three cases at bar, the object or purpose of the plaintis is to recover the ownership and possession of
the same parcels of land.
As far as the parties are concerned, We find that there is no exact identity of parties between Civil Case
No. Q-156, on the one hand, and Civil Cases Nos. 3621, 3622 and 3623, on the other. It appears that of
the plaintis in Civil Cases Nos. 3621, 3622 and 3623 only Elias Benin, Jose Alcantara and Pascual Pili
were plaintis in Civil Case No. Q-156. In Civil Case No. Q-156, the defendants were Mariano Tuason y
de la Paz, Heirs of Mariano Tuason, J.M. Tuason, & Co., Inc. and Gregorio Araneta, Inc. while in Civil
Cases Nos. 3621, 3622 and 3623 the defendants were Mariano Severo, Teresa Eriberta, Juan Jose,
Demetrio Asuncion, Augusto Huberto, all surnamed Tuason y de la Paz (the persons appearing as
registered owners in Original Certificate of Title No. 735), their heirs, and J.M. Tuason and Co., Inc. We
find that the natural persons surnamed Tuason, and the heirs, refer to the persons who belong to the
Tuason family that secured the registration of Parcel 1 in Original Certificate of Title No. 735. The
defendant Gregorio Araneta Inc. in Civil Case No. Q-156 is the administrator of the Tuason properties.
So, the parties defendants in all these cases are practically the same. We find, however, that in Civil
Case No. Q-156 as well as in Civil Cases Nos. 3621, 3622 and 3623, it was the defendant J. M. Tuason
& Co., Inc. that actually controverted the claims of the plaintis.
After a careful study, We are of the considered view that the judgment in the Alcantara case is a bar to
the action of the plaintis who are the heirs of Elias Benin in Civil Case No. 3621 (G.R. No. 26127), of
plainti Jose Alcantara in Civil Case No. 3622 (G.R. No. 26128), and of plainti Pascual Pili in Civil Case
No. 3623 (G. R.
!75 of 105!
No. 26129) under the doctrine of res adjudicata. We are likewise of the considered view that the decision
in the Alcantara case would serve to rule out the action of the other plaintis in Civil Cases Nos. 3621,
3622 and 3623 under the doctrine of stare decisis.
In Civil Case No. 3621 the original plaintis were Victor Benin, Marta Benin, and Elias Benin two
brothers and a sister. In the amended complaint it was alleged that these three original plaintis had
another brother, and another sister, namely Esteban Benin and Felipa Benin. But because all the five
Benin brothers and sisters died, they were all substituted by their heirs, such that as of the time when
Civil Case No. 3621 was decided the Plaintis were: (1) the heirs of Victor Benin;
(2) the heirs of Marta Benin; (3) the heirs of Elias Benin;
(4) the heirs of Esteban Benin, and (5) the heirs of Felipa Binin.
In Civil Case No. 3622 the original plaintis were Juan Alcantara and Jose Alcantara. Juan Alcantara
died, and he was substituted by his heirs, such that as of the time Civil Case No. 3622 was decided the
plaintis were: (1) the heirs of Juan Alcantara, and (2) Jose Alcantara.
In Civil Case No. 3623 the original plaintis were Pascual Pili and Luisa Pili. In the amended complaint,
it was alleged that Luisa Pili and Pascual Pili had two brothers who were already dead, namely, Diego
Pili and Manuel Pili, so they were substituted by their heirs. Luisa Pili died, and she was substituted by
her heirs, such that as of the time Civil Case No. 3623 was decided, the plaintis were: (1) the heirs of
Diego Pili;
(2) the heirs of Manuel Pili; (3) the heirs of Luisa Pili, and
(4) Pascual Pili.
It would thus appear that of the plaintis in Civil Case No. 3621 Elias Benin is the only one who was a
plainti in Civil Case No. Q-156; of the plaintis in Civil Case No. 3622 Jose E. Alcantara, who is still
living, is the only one who was a plainti in Civil Case No. Q-156; of the plaintis in Civil Case No. 3623
Pascual Pili, who is still living, is the only one who was a plainti in Civil Case No. Q-156.
It being Our finding that the judgment in Civil Case No. Q156 (G.R. No. L-4998 the Alcantara case) is
a final judgment on the merits that was rendered by a court that had jurisdiction over the subject matter
and over the parties, and that there is identity of subject matter and cause of action between Civil Case
No. Q-156, on the one hand, and Civil Cases Nos. 3621, 3622, and 3623, on the other; and it appearing
that Elias Benin is a party-plainti both in Civil Case Q-156 and Civil Case No. 3621, that Jose Alcantara
is a party-plainti in both Civil Case No. Q-156 and Civil Case No. 3622; that Pascual Pili is a party-
plainti in both Civil Case No.
For August 18, 2017
Q-156 and Civil Case No. 3623; and that the defendants in Civil Case No. Q-156 and in Civil Cases Nos.
3621, 3622 and 3623 are practically the same persons and/or entities, We hold that the doctrine of bar
by a previous judgment or res adjudicata squarely applies to Elias Benin, or to his heirs and successors
in interest in Civil Case No. 3621; to Jose Alcantara and his heirs or successors in interest in Civil Case
No. 3622; and to Pascual Pili and his heirs or successors in interest in Civil Case No. 3623.
We now consider the case of the other plaintis in Civil Cases Nos. 3621, 3622 and 3623.
It will be noted that in Civil Case No. 3621 the plaintis base their claim of ownership of the three parcels
of land described in the complaint on their being heirs or successors in interest of Sixto Benin who died
in 1936. In Civil Case No. 3622 the plaintis base their claim of ownership over the two parcels of land
described in their complaint on their being the heirs and successors in interest of Bonoso Alcantara who
died in 1934. In Civil Case No. 3623 the plaintis base their claim of ownership of the one parcel of land
described in their complaint on their being the heirs and successors in interest of Candido Pili who died
in 1931.
When Jose Alcantara, Elias Benin and Pascual Pili, alleged in their complaint in Civil Case No. Q-156
(which was filed in 1950) that they were the owners of the parcels of land specified in their complaint,
having inherited the same from their ancestors and had been in possession of the same from time
immemorial, each was claiming a right as an heir of Bonoso Alcantara, Sixto Benin, and Candido Pili,
respectively. Similarly, in Civil Cases Nos. 3621, 3622 and 3623, the source of the rights claimed by the
plaintis Jose Alcantara, Elias Benin and Pascual Pili and all the other plaintis were their respective
ancestor, or predecessor in interest, namely Bonoso Alcantara, Sixto Benin and Candido Pili, as the case
may be.
Inasmuch as Sixto Benin died in 1936, Bonoso Alcantara died in 1934, and Candido Pili died in 1931, it
is obvious that during all the time when the registration proceedings in LRC No. 7681 were taking place
before the Court of Land Registration, which culminated in the issuance of Original Certificate of Title No.
735 on July 8, 1914, Sixto Benin, Bonoso Alcantara, and Candido Pili were living. The records show that
no one of these three persons, or their representative, had filed any opposition to the application for
registration in said LRC 7681, nor did any one of them, or their representative, file any petition for review
of the decree of registration No. 17431 that was issued in said LRC No. 7681.
!76 of 105!
It is Our view, therefore, that the decision of this Court, in G.R. No. L-4998, which armed the order of
the Court of First Instance of Rizal dismissing the complaint of Jose Alcantara, Elias Benin and Pascual
Pili (along with four other plaintis) in Civil Case No. Q-156 should apply not only against the heirs, of
Elias Benin, against Jose Alcantara, and against Pascual Pili, as plaintis in Civil Cases Nos. 3621, 3622
and 3623, respectively, but also against all the other plaintis in those cases. We find that the plaintis
in Civil Case No. 3621 do not claim a right which is dierent from that claimed by Elias Benin in Civil
Case No. Q-156. Likewise, the plaintis in Civil Case No. 3622 do not claim a right dierent from that
claimed by Jose Alcantara in Civil Case, No. Q-156. And, also, the plaintis in Civil Case No. 3623 do
not claim a right dierent from that claimed by Pascual Pili in Civil Case No. Q-156. They all claim the
same right, based on the alleged ownership of their respective common predecessor in interest - in Civil
Case No. 3621 the common predecessor in interest being Sixto Benin; in Civil Case No. 3622 the
common predecessor in interest being Bonoso Alcantara; and in Civil Case No. 3623 the common
predecessor in interest being Candido Pili. In Civil Case No. Q-156 Elias Benin based his claim of
ownership upon the ownership of his predecessor in interest who necessarily must be Sixto Benin; Jose
Alcantara, upon the ownership of his predecessor in interest who necessarily must be Bonoso Alcantara;
and Pascual Pili, upon the ownership of his predecessor in interest who necessarily must be Candido
Pili. It follows, therefore, that the decision of this Court in G.R. No. L-4998 (Civil Case No. Q-156i, which
held untenable the cause of action of the successors in interest, of Sixto Benin, of Bonoso Alcantara and
of Candido Pili, to recover the ownership and possession of any land covered by Original Certificate of
Title No. 735, would also foreclose a similar cause of action of all other persons who claim to be
successors in interest of Sixto Benin, of Bonoso Alcantara and of Candido Pili over any land covered by
said certificate of title. As We have adverted to, Sixto Benin died in 1936, Bonoso Alcantara died in 1934,
and Candido Pili died in 1931. These three predecessors in interest of the appellees died long after the
issuance of Original Certificate of Title No. 735, which took place on July 8, 1914.
And so, even if there are plaintis (now appellees) in these three cases who are not privies to plaintis
Jose Alcantara, Elias Benin, and Pascual Pili in Civil Case No. Q-156 (G.R. No. L-4998 the Alcantara
case) and were not parties in that case, still the ruling of this Court in that former case, to the eect that
therein plaintis or their predecessors in interest were bound by the proceedings in the registration court
which culminated in the issuance of Original Certificate of
For August 18, 2017
Title No. 735, holds and applies to those plaintis in these three cases, because the claim of ownership
of these plaintis is based on the same predecessors in interest of plaintis Jose Alcantara, Elias Benin
and Pascual Pili in said Civil Case No. Q-156. 54 It may well be said that the interests of the appellees in
G.R. No. L-26127 (Civil Case No. 3621) who claim rights as heirs or successors in interest of Sixto Benin
were represented by Elias Benin in Civil Case No. Q-156 (G.R. No. L-4998); the appellees in G.R. No.
26128 (Civil Case No. 3622) who claim rights as heirs or successors in interest of Bonoso Alcantara were
represented by Jose Alcantara in Civil Case No. Q-156 (G.R. No. L-4998); the appellees in G.R. No.
26129 (Civil Case No. 3623) who claim rights as heirs or successors in interest of Candido Pili were
represented by Pascual Pili in Civil Case No. Q-156 (G.R. No. L-4998).
(c) In the case of Albina Santiago, et al. vs. J.M. Tuason & Co., Inc. (G.R. No. L-14223, November 23,
1960) 55 , where Original Certificate of Title No. 735 was also in question, this Court ruled on issues akin
to the issues involved in the three cases now at bar. Albina Santiago and her co-plaintis filed a complaint
in the Court of First Instance of Quezon City, docketed as Civil Case No. Q-2918, against J. M. Tuason
& Co., Inc. alleging, substantially, that their ancestor, Inocencio Santiago, was the owner of a parcel of
land, evidenced by a document (attached to their complaint as Annex A) issued by the Spanish
government on May 12, 1848 56 ; that Inocencio Santiago had since then been in possession of the
aforesaid land as owner, publicly, continuously and adversely until his death, when his two children,
Isaias and Albina, succeeded and continued to own and possess said land pro indiviso in the same
character as that of their predecessor; that upon the death of Isaias Santiago his one-half share of the
land was inherited by his eleven children who, together with their aunt Albina, continued to own and
possess the land in the same character as that of their predecessors; that Albina and her co-plaintis
came to know that J.M. Tuason & Co., Inc. had previously filed in the Court of First Instance of Quezon
City Civil Case No. Q27 for "quieting of title and recovery of possession" against five of the children of
Isaias Santiago involving the parcel of land of which they were co-owners; that J.M. Tuason & Co., Inc.
had claimed that parcel to be part of the land covered by its Transfer Certificate of Title No. 119; that the
judgment in Civil Case No. Q-27, in which they (Albina Santiago, et al.) were never impleaded as parties,
had already become final 57 ; that J.M. Tuason & Co., Inc. had executed the judgment against them,
excluding and ousting them from the enjoyment and possession of the land. Albina and her co -plaintis
also alleged that Transfer Certificate of Title No. 119 (37679) of J.M. Tuason &
!77 of 105!
Co., Inc., as well as Original Certificate of Title No. 735 from which the former was derived, did not include
the parcel claimed by them; that even granting that Transfer Certificate of Title No. 119 included the
parcel claimed by them the inclusion of that parcel in the certificate of title of J.M. Tuason & Co., Inc. was
done through fraud because they, nor their predecessors, were not actually notified of the registration
proceedings. As ground for cancellation of the certificate of title of J.M. Tuason & Co., Inc. Albina Santiago
and her co-plaintis further alleged that the technical description in Original Certificate of Title No. 735
had been falsified to include areas never brought within the jurisdiction of the Land Registration Court,
since they were areas not included in the application and publication in the registration proceedings; that
long before the predecessors of J.M. Tuason & Co., Inc. applied for, and secured, registration of the land
which included their parcel of land they had already acquired ownership thereof not only by the document,
Annex A of their complaint, but also by acquisitive prescription. Albina Santiago and her co-plaintis
prayed, that J.M. Tuason & Co., Inc. be ordered to desist from enforcing Civil Case No. Q-27 against
them; that a resurvey be ordered to determine whether or not Transfer Certificate of Title No. 119 (37679)
included the land described in their complaint; that a reconveyance to them be ordered of whatever
portion of the land claimed by them may be found included in Transfer Certificate of Title No. 119; that
Transfer Certificate of Title No. 119 and Original Certificate of Title No. 735 be ordered cancelled and
substituted with a new certificate of title embracing only those lands included in the application,
publication and/or decree in LRC No. 7681 of the Court of Land Registration.
Upon motion of defendant J.M. Tuason & Co., Inc., the Court of First Instance of Quezon City dismissed
the complaint of Albina Santiago, et al., upon the grounds that there was no cause of action, that the case
was barred by a prior judgment in Civil Case No. Q-27 which was armed by the Supreme Court in G.R.
No. L-5079, and that the action of the plaintis, if they had any, had prescribed.
This Court armed the order of the lower court dismissing the complaint of Albina Santiago and her co-
plaintis. 58 Regarding the contention of Albina Santiago and her co-plaintis that the judgment in the
previous case (Civil Case No. Q-27, armed in G.R. No. L-5079) would not operate as res judicata
against them because they were not parties in that suit, and that they did not derive their title from the
defendants in the previous suit, this Court held:
"We agree with appellants that the decision in the preceding suit to quiet title, prosecuted by the appellee
For August 18, 2017
Tuason & Co. against other heirs of Ynocencio Santiago (99 Phil., 615; 50 O. Gaz. 11, 5727), can not
constitute res judicata against these appellants who were not parties to that suit and do not derive their
title from the defendants in the previous litigation (Rule 39, sec. 44 (b). There is authority for the
proposition that a judgment may be made binding in a subsequent litigation upon one who, although not
a formal party to a previous suit, has actually conducted or controlled the action or defense therein (65
ALR 1134), or who was adequately represented in such previous litigation but no clear proof of the
existence of such exceptional circumstances is before us in the present case. On the other hand, the rule
is that co-owners are not privies inter se in relation to the property owned in common.
xxx xxx xxx
"But granting that the plaintis-appellants herein are not privies of the defendants Santiago in the former
litigation over this same property (S.C.G.R. No. L-5079), still the pronouncement of this Court, made in
the former case, to the eect that the Spanish document (Annex A) issued in favor of Ynocencio Santiago
(ancestor of appellants herein) was neither a titulo de informacion posesoria nor a title by composicion
con el estado, and, therefore, vested no ownership over the land therein described in favor of Ynocencio
Santiago, holds and applies to herein appellants, since the quality or the legal eect of the document
does not depend upon the person who invoke it.
"If the late Ynocencio Santiago did not become the owner of the disputed property by virtue of the
document Annex A, then appellants herein, as heirs of Ynocencio, have not acquired such ownership
either. It follows that the first and second causes of action of their complaint, predicated as they are on
the assumption that such ownership and its consequential rights resulted from Annex A, must necessarily
fail. Not being owners, they can complain of no invasion of dominical rights.
It will thus be noted that in the afore-mentioned decision in the Santiago case, even if Albina Santiago
and her co-plaintis were not considered privies to the defendants in Civil Case No. Q-27, and even if
they were not parties in that previous case, this Court nevertheless applied to them the judgment (G. R.
No. L-5079) in that previous case where it was pronounced that the document, Annex A of the complaint
of Albina Santiago, et al., was neither a titulo de informacion posesoria nor a title by composicion con el
estado, and it did not establish the right of ownership of their predecessor in interest, Inocencio Santiago,
Albina Santiago and her co-plaintis had based their claim of ownership on that document (Annex A). 59
This Court
!78 of 105!
held in that previous case that the document was unavailing against Transfer Certificate of Title No. 119
of J, M. Tuason & Co., Inc. and against Original Certificate of Title No. 735.
And so, following the logic of this Court in its decision in the Santiago case, in the three cases at bar We
hold that even if the plaintis in Civil Case No. 3621, except the heirs of Elias Benin, are not privies to
Elias Benin and were not parties in Civil Case No. Q-156; even if the plaintis in Civil Case No. 3622,
except Jose Alcantara, are not privies to Jose Alcantara and were not parties in Civil Case No. Q-156;
and even if the plaintis in Civil Case No. 3623, except Pascual Pili, are not privies to Pascual Pili and
were not parties in Civil Case No. Q156, still the pronouncement of this Court in the judgment in that
previous case (G.R. No. L-4998), to the eect that the plaintis in that case and their predecessors in
interest were bound by the registration proceedings which culminated in the issuance of Original
Certificate of Title No. 735, holds and applies to all the plaintis (now appellees) in these three cases. In
that judgment this Court ruled out, or did not sustain, the rights claimed by the predecessors in interest
of herein appellees over the land covered by Original Certificate of Title No. 735. These appellees,
therefore, have not succeeded to any right that can derrogate the validity and conclusiveness of Original
Certificate of Title No. 735, and of the certificates of title that are derived from said original certificate of
title.
Coming back to the Santiago case, as regards the contention of Albina Santiago and her co-plaintis that
the registration proceedings which resulted in the issuance of Original Certificate of Title No. 735 were
irregular and fraudulent, this Court held:
"(T)he mere fact that appellants herein were not personally notified of the registration proceedings that
resulted in a decree of registration of title in favor of the Tuasons in 1914 does not constitute in itself a
case of fraud that would invalidate the decree. The registration proceedings, as proceedings in rem,
operate as against the whole world and the decree issued therein is conclusive adjudication of the
ownership of the lands registered, not only against those parties who appeared in such proceedings but
also against parties who were summoned by publication but did not appear. The registration by the
appellee's predecessors-in-interest freed the lands from claims and liens of whatever character that
existed against the lands prior to the issuance of the certificates of title, except those noted in the
certificate and legal encumbrances saved by law (Yumol vs. Rivera and Dizon, 64 Phil. 13, 17 and cases
cited therein). In addition, there being no allegation that the registered owners procured the non-
appearance of appellants at the registration proceedings, and very
For August 18, 2017 much more than one year having elapsed from the issuance of the decree of
registration in 1914, neither revocation of such decree nor a decree of reconveyance are obtainable any
more.
Regarding the claim of Albina Santiago and her co-plaintis that they had acquired title by prescription
over the parcel of land claimed by them, this Court held:

"It follows also that the allegation of prescriptive title in favor of plaintis does not suce to establish a
cause of action. If such prescription was completed before the registration of the land in favor of the
Tuasons, the resulting prescriptive title was cut o and extinguished by the decree of registration. If, on
the contrary, the prescription was either begun or completed after the decree of registration, it conferred
no title because, by express provision of law, prescription cannot operate against the registered owner
(Act 496, section 46).

Thus, in this Santiago case, as in the Alcantara case, this Court declared conclusive and indefeasible
Original Certificate of Title No. 735 which was issued as a result of the registration proceedings in L.R.C.
No. 7681 of the Court of Land Registration. There are many other cases where this Court has made a
similar pronouncement regarding Original Certificate of Title No. 735.

In view of the findings, and the rulings, that We have hereinbefore made, it follows that, as contended by
the appellant, the lower court also erred when it declared the appellees the owners of the lands claimed
by them and in awarding damages to them, in these three cases.

We consider it unnecessary to rule on the counterclaim of appellant J.M. Tuason & Co., Inc., for damages
and attorneys fees against the appellees 63 We believe that the appellees had filed their complaints in
the honest, but mistaken, belief that they have a good cause of action against the appellant corporation
and not because they meant to embarrass or humiliate the persons who are identified or connected with
the appellant.

WHEREFORE, the joint decision of the Court of First Instance of Rizal (Quezon City Branch) in Civil
Cases Nos. 3621, 3622 and 3623, appealed from, is reversed and set aside. The bond filed by appellant
in the three cases in the court below for the lifting of the writ of preliminary injunction is ordered cancelled.
No pronouncement as to costs.
!79 of 105!

IT IS SO ORDERED.

Makalintal, C. J. , Castro, Teehankee, Barredo, Makasiar, Antonio, Esguerra, Fernandez, Muoz Palma
and Aquino, JJ., concur.

Fernando, J., did not take part.

FIRST DIVISION
[G.R. No. 109903. November 20, 1995.]
SPOUSES ANDRES SUOBIRON and SOCORRO SUOBIRON, JOSE SULLANO JR. and IRENEO
FERRARIS, petitioners, vs. COURT OF APPEALS, LAND REGISTRATION COMMISSION, REGISTER
OF DEEDS of the PROVINCE OF ILOILO, FORTUNATA PONCE VDA. DE ADELANTAR, REMEDIOS
ADELANTAR, CARIDAD A. CHANCO, FLORECITA A. MONTILLA, EVANGELINA A. COSCOLLUELA,
LYNDE ADELANTAR, DOUGLAS M. ADELANTAR, PROTACIO ADELANTAR himself and as
Administrator of the INTESTATE ESTATE of the late LUIS ADELANTAR, respondents.
Tranquilino R. Gale and Hector P. Teodosio for petitioners.
Salvador A. Cabaluna, Jr. for private respondents.
DECISION
BELLOSILLO, J p:
Petitioner-spouses Andres Suobiron and Socorro Suobiron, Jose Sullano Jr. and Ireneo Ferraris
instituted on 2 December 1980 an action to annul the orders dated 25 August 1945 and 28 January 1946
of the then Court of First Instance (CFI) of Iloilo in LRC Case No. 673, GLRO Record No. 54404, as well
as OCT Nos. 69237 and 69238 and the corresponding decrees issued by the Land Registration
Commission. Public respondents Land Registration Commission and Register of Deeds of the Province
of Iloilo, and private respondents Fortunata Ponce Vda. de Adelantar, Caridad A. Chanco, Florecita A.
Montilla, Evangelina A. Coscolluela, and Remedios, Lynde, Douglas and Protacio, all surnamed
Adelantar, were named defendants.
Petitioners alleged in their complaint that the land registration court acted without or in excess of
jurisdiction in issuing both orders because the requirements of the law on reconstitution of court records
were not complied with thus rendering void not only the orders but also the decrees and certificates of
title issued thereunder.
Private respondents denied the allegations for the annulment of the orders and decrees. They
counterclaimed for the delivery to them of the property in litigation consisting of 26.5 hectares of sugarland
For August 18, 2017 and for the payment of the net produce which they could have received had they
not been deprived of possession thereof.
From the evidence and the admission of the parties the trial court found that the two (2) parcels of land
were previously subject of LRC Case No. 673, GLRO Record No. 54404, before the CFI of Iloilo and that
aside from the Director of Lands, the other oppositors who appeared therein were Doroteo Legarde and
Bernabe, Basilia, Quintin and Fortunato, all surnamed Lorezo.
On 1 September 1941, after due notice, publication and hearing, the CFI rendered judgment adjudicating
the parcels of land in favor of spouses Luis Adelantar and Fortunata Ponce. The oppositors elevated the
decision to the Court of Appeals. On 23 March 1943, however, for failure of the oppositors to pay the
docket fees and to deposit the estimated cost of printing the record on appeal within the reglementary
period, the appellate court dismissed the appeal.
On 22 March 1945, four days after the American forces liberated Panay Island, the CFI was reorganized.
Pursuant to Act 3110, 1 the clerk of court submitted a report stating that all court records were destroyed
or burned as a result of the battle for liberation. Thereafter, on 7 June 1945 the court issued an order
directing the reconstitution of the records. The order was published in two (2) leading newspapers in Iloilo
City, namely, "Ang Tigbatas" and "The Times," once a week for six
(6) months.
On 18 August 1945 Luis Adelantar filed a motion for reconstitution of the records of LRC Case No. 673
furnishing copies thereof to oppositors Sabas, Ireneo, Pilar and Preciosa, all surnamed Lucero, and
Bernabe, Basilia, Quintin and Fortunato, all surnamed Lorezo, through their respective counsel, as well
as the Provincial Fiscal of Iloilo representing the Director of Lands. The oppositors did not however
appear when the motion was heard on 25 August 1945. Thus on the same day the CFI gave due course
to the motion for reconstitution.
On 28 January 1946, on motion of the Adelantar spouses, the CFI directed the issuance of decrees
covering the property in litigation after which Decrees Nos. 766623 and 766624 were issued by the Land
Registration Commission. On the basis of these decrees OCT Nos. 69237 and 69238 were issued in the
name of the spouses Luis Adelantar and Fortunata Ponce.
Taking advantage in the meantime of the chaotic conditions during the war, Quintin Lorezo and Bernabe
Lorezo entered the litigated property and appropriated
!80 of 105!
the produce thereof to the damage and prejudice of the registered owners. Consequently, on 26 August
1947 the Adelantars filed an action in the CFI of Iloilo against the Lorezos for recovery of possession,
docketed as Civil Case No. 938. Basilia Lorezo, Isabel Lorezo and Canuto Lucero intervened and were
allowed to file their answers.
On 3 September 1953 the CFI rendered judgment declaring the Adelantar spouses owners of the property
and ordering the receiver earlier appointed by the court to deliver to them the possession thereof as well
as the produce received by the receiver since his appointment.
The decision having become final and executory the trial court issued a writ of execution which was
implemented by the Provincial Sheri on 27 February 1954 by delivering to the spouses Luis Adelantar
and Fortunata Ponce the possession of the two (2) parcels of land. On the same occasion Luis Adelantar
accepted from the receiver the produce consisting of five (5) bultos of palay. However, after the delivery
of the property by the Provincial Sheri to the Adelantars, Quintin, Basilia, Bernabe and Fortunato Lorezo
re-entered the premises. Other persons followed suit.
The property soon became the subject of a cadastral survey. Fortunata Ponce, who was already a widow,
filed an answer claiming ownership. The spouses Andres Suobiron and Socorro Suobiron also filed an
answer claiming ownership of portions thereof by purchases from Quintin in 1960, from Basilia and Isabel
Lorezo in 1961, and from Canuto Lucero in 1969 thus prompting the cadastral court to advise the parties
to file the proper action and to litigate the question of ownership.
Accordingly, on 22 July 1970 Fortunata Ponce and the other private respondents, as heirs of Luis
Adelantar, filed an action for quieting of title and for recovery of possession with damages before the CFI
of Iloilo, docketed as Civil Case No. 8283. The complaint however was dismissed without prejudice.
On 21 December 1972 petitioners sought annulment of the certificates of title of the Adelantars but their
action was also dismissed without prejudice on 22 February 1980. Thus petitioners filed their complaint
alleging co-ownership of the property.
On 29 August 1986, finding no factual nor legal basis to grant petitioners' prayer, the trial court dismissed
the complaint and directed them to vacate the property and deliver possession thereof to private
respondents and to pay them jointly and severally P39,750.00 annually as net produce from 1970 until
possession
For August 18, 2017 was restored to the latter, P10,000.00 as attorney's fees, and to pay the costs of
suit.
On 19 January 1993 respondent Court of Appeals armed the ruling of the trial court except with respect
to the award of attorney's fees which was deleted as no reason was given therefor. 3 On 15 March 1993
the motion for reconsideration was denied.
Petitioners raise these issues before us: whether the provisions of Act 3110 have been complied with;
whether the decision in Civil Case No. 938 is conclusive upon them; and, whether they are liable to private
respondents for damages.
Petitioners allege that Act 3110 was violated since (a) the general notice of loss required to be served by
registered mail to interested parties and its publication in the Ocial Gazette were not complied with; (b)
no notice of loss was sent to counsel of record of their predecessors-in-interest; and, (c) no duly certified
or authentic copy of the Court of Appeals' resolution of 23 March 1943 was produced in the reconstitution
proceedings. They also claim that the decision in Civil Case No. 938 is not conclusive upon them because
the subject matter thereof does not involve the legality of the reconstitution of LRC Case No. 673, and
that damages should not have been awarded against them as their possession of the parcels of land was
lawful.
We arm the decision of the Court of Appeals as we find no reversible error therein. Sections 1, 2 and 3
of Act 3110 provide:
SECTION 1. As soon as practicable after the occurrence of any fire or other public calamity resulting in
the loss of all or part of the records of judicial proceedings on file in the oce of the clerk of a Court of
First Instance, said ocer shall send a notice by registered mail to the Secretary of Justice, the Attorney-
General, 5 the Director of Lands, the Chief of the General Land Registration Oce, 6 the clerk of the
Supreme Court, the judge of the province, the register of deeds of the province, the provincial fiscal; and
all lawyers who may be interested, stating the date on which such fire or public calamity occurred and
whether the loss or destruction was total or partial, and giving a brief list of the proceedings not aected
in case the loss or destruction was partial.
SECTION 2. Upon receipt of the notice mentioned in the preceding section, the court shall issue or cause
to be issued a general notice which shall be addressed and sent by registered mail to the lawyers and
ocers mentioned in the preceding section, and to such other persons as might be interested, advising
them of the destruction of the records, with a brief list of the
!81 of 105!
proceedings not aected in case the destruction was partial, and of the time fixed by this Act for the
reconstitution of the destroyed records.
This notice shall also be published in the Ocial Gazette and in one of the newspaper most widely read
in the province, once a week, for four consecutive weeks.
SECTION 3. The parties to civil cases, or their counsels, shall appear and file, within thirty days after
having been notified in accordance with the next preceding section, an application for the reconstitution
of the records in which they are interested, and the clerk of the court, upon receiving such application,
shall send notice to all parties interested, or their counsels, of the day, hour, and place when the Court
will proceed to the reconstitution, requesting them to present, on said day and hour, and at said place,
all copies of motions, decrees, orders, and other documents in their possession, having reference to the
record or records to be reconstituted.
As may be gleaned from the above, the Act provides that after the occurrence of any fire or other public
calamity resulting in the loss of all or part of the records of judicial proceedings, the clerk of court shall
send a notice by registered mail, among other ocers, to the judge of the province and all lawyers who
may be interested in the proceedings (Sec. 1) and upon receipt of such notice, the court shall issue a
general notice which shall be addressed and sent by registered mail to said lawyers and oces, and to
such other persons as might be interested, advising them of the destruction of the records. This notice
shall be published in the Ocial Gazette and in one of the newspapers of wide circulation in the province
once a week for four consecutive weeks (Sec. 2). The Act likewise provides that any interested party or
his counsel shall appear and file within thirty days after having been notified of the destruction as above
stated an application for the reconstitution of the records of the case, and the clerk of court upon receiving
such application shall send notice to other parties interested or their counsel of the day, hour and place
when the court will proceed with the reconstitution (Sec. 3).
This briefly is the procedure laid down by Act 3110 for the reconstitution of a court record in case of loss
or destruction.
In Paluay v. Bacudao 7 we held that there was substantial compliance with the law if the clerk of court
sent a notice to the judge of the province informing him of the destruction of all court records in the
province and that acting thereon the judge immediately issued an order for their reconstitution which was
published in
For August 18, 2017 a newspaper of general circulation in the city or province once a week for six (6)
months. The law was considered substantially complied with even if it did not appear that notice of the
destruction was ever served by registered mail to all lawyers or persons who appeared to be interested
in the cases aected. It was enough that the applicant sent a copy of his petition for reconstitution to the
oppositors or their counsel in order that they may be notified of the date and place of the hearing thereof.
In the case at bench, the requirements of the law for the reconstitution of a court record were fulfilled.
The clerk of court, soon after liberation, sent a notice to the then presiding judge of the Court of First
Instance of Iloilo informing him of the destruction of all court records in the province. Acting thereon the
judge immediately issued an order for their reconstitution which was published in two (2) newspapers of
general circulation in the Province and City of Iloilo once a week for six (6) months. Copies of the motion
for reconstitution were served by the movant (the now deceased Luis Adelantar) on the oppositors
through their respective counsel. It appearing that Atty. Felix Evidente was not the oppositors' counsel of
record the allegation that no notice was served on him may no longer be relevant.
The Adelantar spouses might have failed to submit in the reconstitution proceedings an authentic copy
of respondent court's resolution of 23 March 1943 as what they submitted instead was the order dated
10 June 1994 of the CFI in LRC Case No. 673 directing compliance with and execution of the resolution
quoted in the order. 9 But we find that this is another instance of substantial compliance with Act 3110,
particularly Sec. 3 thereof, regarding presentation by the interested parties of all copies of motions,
decrees, orders and other documents in their possession relative to the record or records to be
reconstituted.
The decision in Civil Case No. 938 declaring the Adelantar spouses owners of the two (2) parcels of land
claimed by Basilia Lorezo, Isabel Lorezo and Canuto Lucero is conclusive upon the parties therein as
well as their successors-in-interest, the parties herein, under the doctrine of res judicata. The trial court
held petitioners liable to private respondents for the net produce of the properties in question from the
time the former's possession in good faith was legally interrupted when they were served summons in
connection with private respondents' complaint for recovery of possession with damages filed 22 July
1970, docketed as Civil Case No. 8283, at the rate of P1,500.00 per hectare or P39,750.00 for 26.5
hectares annually until possession was restored. It may be that petitioners acquired the disputed
properties in good
!82 of 105!
faith and had since then occupied the same but such bona fide character of possession ceased when
they were served summons. Possession acquired in good faith may not lose this character except in the
case and from the moment facts exist which show that the possessor is not unaware that he possesses
the thing improperly or wrongfully, conformably with Art. 528 of the Civil Code.
As early as Rodriguez v. Francisco, 10 this Court already ruled that
. . . on the date of the service of summons upon appellee in this case considering that (appellant) was
thereafter declared owner by final judgment (G.R. No. L-12039), appellee's possession in good faith was
interrupted and hence from that time he lost the right to the fruits.

In turn, that decision was based on Tacas v. Tobon 12 where this Court, citing Manresa, 13 stated

But to every possessor in good faith there comes a time when he is considered a possessor in bad faith.
When the owner or possessor with a better right comes along, when he becomes aware that what he
had taken for granted is at least doubtful, and when he learns the grounds in support of the adverse
contention, good faith ceases. The possessor may still believe that his right is more secure, because we
resign ourselves with diculty to the sight of our vanishing hopes; but when the final judgment of the
court deprives him of the possession, all illusion necessarily disappears. Although he may not have been
convinced of it before, the possessor becomes aware that his possession is unlawful from the time he
learns of the complaint, from the time he is summoned to the trial. It is at this time that his possession is
interrupted, according to Article 1945, and that he ceases to receive the fruits, according to the first
paragraph of Article 451. The ruling of the court retroacts to that time; but shall good faith be deemed to
cease then? Although there is a great dierence between requiring the possessor in good faith to return
the fruits he received from the time when his possession was legally interrupted, and considering him a
possessor in bad faith for all legal purposes from that time, the law had to establish a definite rule on the
matter, which is none other than that deducible from a combination of Articles 452, 1945 and 435.
Whether or not the defendant be a possessor in good faith, for there is no doubt that he can be, and the
law makes no attempt to deny it, from the service of judicial summons, there exists an act that this
possessor knows that his right is not secure, that someone disputes it, and that he may yet lose it; and if
the court holds that restitution be made, that time determines all the legal consequences of the

For August 18, 2017 interruption, the time when the possession in good faith ceased to be so before the
law . . . .

WHEREFORE, the petition is DENIED. The decision of respondent Court of Appeals dated 19 January
1993 and its resolution of 15 March 1993 are MODIFIED. Costs against petitioners.
SO ORDERED. LexLibris

Padilla, Davide, Jr., Kapunan, and Hermosisima, JJ., concur.

THIRD DIVISION
[G.R. No. 27876. April 22, 1992.] ADELAIDA S. MANECLANG, in her capacity as Administrator of the
Intestate Estate of the late
Margarita Suri Santos, plainti-appellee, vs. JUAN T. BAUN and AMPARO S. BAUN, ET AL., defendants.
CITY OF DAGUPAN, defendant-appellant. Emerito M. Salva & Associates for plainti-appellee. The Law
Firm of Volfango and Sales for defendant-
Margarita left several parcels of land, among which is Lot No. 203 of the Cadastral Survey of Dagupan
City containing an area of 7,401 square meters, more or less, and covered by Transfer Certificate of Title
No. 1393.
On 2 September 1949, Pedro M. Feliciano, the administrator of the intestate estate of Margarita, filed a
petition in SP Proc. No. 3028 asking the court to give him "the authority to dispose of so much of the
estate that is necessary to meet the debts enumerated" in the petition. While notice thereof was given to
the surviving spouse, Severo Maneclang, through his counsel, Atty. Teofilo Guadiz, no such notice was
sent to the heirs of Margarita.

appellant. On 9 September 1949, despite the absence of notice to the heirs, the intestate court issued an Order
"authorizing the administrator to mortgage or sell so much of the properties of the estate for the purposes
DECISION (sic) of paying o the obligations" referred to in the petition.

DAVIDE, JR., J p:
The issue presented in this case is the validity of a sale of a parcel of land by the administrator of an
intestate estate made pursuant to a petition for authority to sell and an order granting it which were filed
and entered, respectively, without notice to the heirs of the decedent.
The records disclose that on 12 June 1947, Margarita Suri Santos died intestate. She was survived by
her husband Severo Maneclang and nine (9) children. On 30 July 1947, a petition for the settlement of
her estate was filed by Hector S. Maneclang, one of her legitimate children, with the Court of First Instance
at Dagupan City, Pangasinan; the case was docketed as Special Proc. No. 3028. At the time of the filing
of the petition, the ages of her children were as follows:
Pursuant to this Order, Oscar Maneclang, the new administrator of the intestate estate, executed on 4
October 1952 a deed of sale 1 in favor of the City of Dagupan, represented by its mayor, Angel B.
Fernandez, of a portion consisting of 4,515 square meters of the aforementioned Lot No. 203 for and in
consideration of P11,687.50. This sale was approved by the intestate court on 15 March 1954.
The City of Dagupan immediately took possession of the land and constructed thereon a public market,
known as the Perez Boulevard Public Market, at a cost of P100,000.00, more or less. It has been in
continuous and uninterrupted possession of the property since the construction of the market.
Some other parcels of land belonging to the intestate estate were sold by the administrator pursuant to
the same authority granted by the 9 September 1949 Order.

AGE On 28 September 1965, the new judicial administratrix of the intestate estate, Adelaida S. Maneclang,

H. Maneclang 21 For August 18, 2017 daughter of the late Margarita Suri Santos, filed with the Court of First Instance of
C. Maneclang 19 Pangasinan an action for the annulment of the sales made by the previous administrator pursuant to the
Order of 9 September 1949, cancellation of titles, recovery of possession and damages against the
vendees Juan T. Baun and Amparo Baun, Marcelo Operaa and Aurora Pagurayan, Crispino Tandoc
O. Manaclang 17
and Brigida Tandoc, Jose Infante and Mercedes Uy Santos, Roberto Cabugao, Basilisa Callanta and Fe
Callanta, Ricardo Bravo and Francisca Estrada, the City of Dagupan, and Constantino Daroya and
A. Maneclang 16 Marciana Caramat. 4 The complaint was docketed as Civil Case No. D-1785. The cause of action against
the City of Dagupan centers around the deed of sale executed in its favor on 4 October 1952 by former
A. Maneclang 13 judicial administrator Oscar S. Maneclang. In its Answer filed on 5 November 1965, 5 the City of Dagupan
interposed the following armative defenses: (a) the sale in its favor is valid, legal and above board; (b)
L. Maneclang 7 plainti has no cause of action against it, or that the same, if any, had prescribed since the complaint
was filed thirteen (13) years after the execution of the sale; (c) plainti is barred by estoppel and by
83! of 105! laches; (d) it is a buyer in good faith, and (e) it has introduced necessary and useful improvements and
constructed a supermarket worth P200,000.00; hence, assuming arguendo that the sale was illegal, it
AGE has the right to retain the land and the improvements until it is reimbursed for the said improvements.

P. Maneclang 6 On 30 March 1966, plainti and the City of Dagupan entered into a Stipulation of Facts wherein they
agreed on the facts earlier adverted to. They, however, agreed:
N. Maneclang 3
(a) to adduce evidence concerning the reasonable rental of the property in question and other facts not
embodied therein but which are material and vital to the final determination of the case, and (b) to request
T. Maneclang 2
the court to take judicial notice of SP Proc. No. 3028.

The evidence adduced by plainti discloses that Oscar Maneclang was induced by its then incumbent
No guardian ad litem was appointed by the court for the minor children. Mayor, Atty. Angel B. Fernandez, to sell the property to the City of Dagupan and that the said City has
been leasing the premises out to numerous tenants at the rate of P0.83 per square meter per month, or
a total monthly rental of P3,747.45, since 4 October 1952.
On 9 November 1966, the trial court rendered a partial decision in Civil Case No. D-1785 against the City
of Dagupan, the dispositive portion of which reads as follows:
"IN VIEW OF THE FOREGOING CONSIDERATIONS, the Court hereby renders judgment:
(a) Annulling (sic) the Deed of Sale executed by the Administrator on October 4, 1952 (Exh. F) being null
and void ab initio;
84! of 105!
(b) Ordering the cancellation of the Certificate of Title issued in favor of the defendant City of
Dagupan by virtue of said Deed of Sale, and directing the Register of Deeds of said City to issue a new
Certificate of Title in favor of the plainti as Administratrix covering the property in question;
(c) Ordering the defendant City of Dagupan to restore the possession to the plainti in her capacity
as Judicial Administratrix of the Intestate Estate of Margarita Suri Santos of the parcel of land in question,
together with all the improvements thereon existing;
(d) Ordering the defendant City of Dagupan to pay the plainti the sum of P584,602.20 as
accumulated rentals or reasonable value of the use of the property in question from October 4, 1952 up
to the filing of the complaint in 1965, plus interest thereon at the rate of 6% per annum from the later
date;
(e) Ordering the defendant City of Dagupan to pay a monthly rental or reasonable value of its
occupation of the premises in the amount of P3,747.45 from October 9, 1965 up to the date the
possession of the premises is delivered (sic) the plainti by said defendant, and
(f) Ordering the plainti to reimburse the defendant City of Dagupan the sums of P100,000.00
and P11,687.50 both amounts to be deducted from the amount due the plainti from said defendant.
Defendant shall also pay the costs.
SO ORDERED."
In arriving at the said disposition, the trial court held that:
(a) Under Rule 90 of the Rules of Court, 8 which is similar to the provisions of Section 722 of the Code
of Civil Procedure, it is essential and mandatory that the interested parties be given notices of the
application for authority to sell the estate or any portion thereof which is pending settlement in a probate
court. As held in the early case of Estate of Gamboa vs. Floranza, 9 an order issued by a probate court
for the sale of real property belonging to the estate of a deceased person would be void if no notice for
the hearing of the petition for such sale is given as required by said Section 722. Under this section, when
such a petition is made, the court shall designate a time and place for the hearing and shall require notice
of the petition and of the time and place of such hearing to be given in a newspaper of general circulation;
moreover, the court may require the giving of such further notice as it deems proper.
For August 18, 2017
In the instant case, no notice of the application was given to the heirs; hence, both the order granting
authority to sell and the deed of sale executed in favor of the City of Dagupan pursuant thereto, are null
and void.
(b) Estoppel does not lie against plainti as no estoppel can be predicated on an illegal act and
estoppel is founded on ignorance. In the instant case, the nullity is by reason of the non-observance of
the requirements of law regarding notice; this legal defect or deficiency deprived the probate court of its
jurisdiction to dispose of the property of the estate. Besides, the City of Dagupan was represented in the
transaction by lawyers who are presumed to know the law. This being the case, they should not be
allowed to plead estoppel; finally, estoppel cannot give validity to an act which is prohibited by law or is
against public policy.
(c) Laches and prescription do not apply. The deed of sale being void ab initio, it is in
contemplation of law inexistent and therefore the right of the plainti to bring the action for the declaration
of inexistence of such contract does not prescribe.
(d) The City of Dagupan is not a purchaser in good faith and for value as the former judicial
administrator, Oscar Maneclang, testified that he was induced by then incumbent Mayor of the City Atty.
Angel B. Fernandez, and by then City Councilor Atty. Teofilo Guadiz, Sr. to sell the property; moreover,
the City Fiscal signed as witness to the deed of sale. These lawyers are presumed to know the law.
Not satisfied with the decision, the City of Dagupan appealed to this Court 12 alleging that said decision
is contrary to law, the facts and the evidence on record, and that the amount involved exceeds
P500,000.00.
In its Brief, the City of Dagupan submits the following assigned errors:
"FIRST ERROR
THE LOWER COURT ERRED IN HOLDING THAT THE SALE EXECUTED BY THE JUDICIAL
ADMINISTRATOR TO THE CITY OF DAGUPAN IS NULL AND VOID AB INITIO.
SECOND ERROR
THE LOWER COURT ERRED IN HOLDING THAT PLAINTIFF IS NOT IN ESTOPPEL FROM
ASSAILING THE LEGALITY OF THE SALE.
THIRD ERROR
!85 of 105!
THE LOWER COURT ERRED IN HOLDING THAT THE INSTANT ACTION IS NOT BARRED BY
LACHES AND PRESCRIPTION.
FOURTH ERROR
THE LOWER COURT ERRED IN DECLARING THAT DEFENDANT CITY OF DAGUPAN IS NOT A
PURCHASER IN GOOD FAITH AND FOR VALUE.
FIFTH ERROR
THE LOWER COURT ERRED IN ORDERING DEFENDANT CITY OF DAGUPAN TO PAY THE P L A I
N T I F F T H E S U M O F P 5 8 4 , 6 0 2 . 2 0 A S ACCUMULATED RENTALS OR REASONABLE
VALUE OF (sic) THE USE OF THE PROPERTY IN QUESTION FROM OCTOBER 4, 1952 UP TO THE
FILING OF THE COMPLAINT IN 1965, PLUS INTEREST THEREON AT THE RATE OF 6% PER
ANNUM FROM THE LATER DATE.
SIXTH ERROR
THE LOWER COURT ERRED IN ORDERING THE DEFENDANT CITY OF DAGUPAN TO PAY A
MONTHLY RENTAL OR REASONABLE VALUE OF (sic) ITS OCCUPATION OF THE PREMISES IN
THE AMOUNT OF P3,747.45 FROM OCTOBER 9, 1965 UP TO THE DATE THE POSSESSION OF
THE PREMISES IS D E L I V E R E D T O T H E P L A I N T I F F B Y S A I D DEFENDANT.
We shall consider these assigned errors sequentially.

1. In support of the first, appellant maintains that notice of the application for authority to sell was given
to Severo Maneclang, surviving spouse of Margarita. As the designated legal representative of the minor
children in accordance with Article 320 of the Civil Code,notice to him is deemed sucient notice to the
latter; moreover, after Oscar Maneclang signed the deed of sale 13 in his capacity as judicial
administrator, he "sent copies of his annual report and the deed of sale to Severo Maneclang, and his
brothers Hector Maneclang and Oscar Maneclang and sister Amanda Maneclang, all of legal ages (sic),
while the other minor heirs received theirs through his lawyer." 14 Besides, per Flores vs. Ang Bansing,
15 the sale of property by the judicial administrator cannot be set aside on the sole ground of lack of
notice.
These contentions are without merit.
Article 320 of the Civil Code does not apply. While the petition for authority to sell was filed on 2
September 1949, the Civil Code took eect only on 30 August 1950. 16 Thus, the governing law at the
time of the filing of the petition was Article 159 of the Civil Code of Spain which provides as follows:
For August 18, 2017
"The father, or in his default, the mother, shall be the legal administrator of the property of the children
who are subject to parental authority.
However, the provisions of the Code of Civil Procedure on guardianship impliedly repealed those of the
Civil Code relating to that portion of the patria potestas (parental authority) which gave to the parents the
administration and usufruct of their minor children's property; said parents were however entitled, under
normal conditions, to the custody and care of the persons of their minor children.
Article 320 of the present Civil Code,taken from the aforesaid Article 159, incorporates the amendment
that if the property under administration is worth more than two thousand pesos (P2,000.00), the father
or the mother shall give a bond subject to the approval of the Court of First Instance. This provision then
restores the old rule 18 which made the father or mother, as such, the administrator of the child's property.
Be that as it may, it does not follow that for purposes of complying with the requirement of notice under
Rule 89 of the Rules of Court, notice to the father is notice to the children. Sections 2, 4 and 7 of said
Rule state explicitly that the notice, which must be in writing, must be given to the heirs, devisees, and
legatees and that the court shall fix a time and place for hearing such petition and cause notice to be
given to the interested parties.
There can be no dispute that if the heirs were duly represented by counsel or by a guardian ad litem in
the case of the minors, the notice may be given to such counsel or guardian ad litem. In this case,
however, only the surviving spouse, Severo Maneclang, was notified through his counsel. Two of the
heirs, Hector Maneclang and Oscar Maneclang, who were then of legal age, were not represented by
counsel. The remaining seven (7) children were still minors with no guardian ad litem having been
appointed to represent them. Obviously then, the requirement of notice was not satisfied. The requisite
set forth in the aforesaid sections of Rule 89 are mandatory and essential. Without them, the authority to
sell, the sale itself and the order approving it would be null and void ab initio. 19 The reason behind this
requirement is that the heirs, as the presumptive owners 20 since they succeed to all the rights and
obligations of the deceased from the moment of the latter's death, 21 are the persons directly aected
by the sale or mortgage and therefore cannot be deprived of the property except in the manner provided
by law.
Consequently, for want of notice to the children, the Order of 9 September 1949 granting the application,
the sale in question of 4 October 1952 and the Order of
!86 of 105!
15 March 1954 approving the sale are all void ab initio as against said children. Severo Maneclang,
however, stands on dierent ground altogether. Having been duly notified of the application, he was
bound by the said order, sale and approval of the latter. However, the only interest which Severo
Maneclang would have over the property is his right of usufruct which is equal to that corresponding by
way of legitime pertaining to each of the surviving children pursuant to Article 834 of the Civil Code of
Spain, the governing law at that time since Margarita Suri Santos died before the eectivity of the Civil
Code of the Philippines.
2. Estoppel is unavailable as an argument against the administratrix of the estate and against the children.
As to the former, this Court, in Boaga vs. Soler, supra, reiterated the rule "that a decedent's
representative is not estopped to question the validity of his own void deed purporting to convey land; 22
and if this be true of the administrator as to his own acts, a fortiori, his successor can not be estopped to
question the acts of predecessor are not conformable to law." 23 Not being the party who petitioned the
court for authority to sell and who executed the sale, she cannot be held liable for any act or omission
which could give rise to estoppel. Under Article 1431 of the Civil Code,through estoppel and admission
or representation is rendered conclusive upon the person making it, and cannot be denied or disproved
as against the person relying thereon. In estoppel by pais, as related to the party sought to be estopped,
it is necessary that there be a concurrence of the following requisites: (a) conduct amounting to false
representation or concealment of material facts or at least calculated to convey the impression that the
facts are otherwise than, and inconsistent with, those which the party subsequently attempts to assert;
(b) intent, or at least expectation that this conduct shall be acted upon, or at least influenced by the other
party; and (c) knowledge, actual or constructive of the actual facts. 24 In estoppel by conduct, on the
other hand, (a) there must have been a representation or concealment of material facts; (b) the
representation must have been with knowledge of the facts; (c) the party to whom it was made must have
been ignorant of the truth of the matter; and (d) it must have been made with the intention that the other
party would act upon it.
As to the latter, considering that, except as to Oscar Maneclang who executed the deed of sale in his
capacity as judicial administrator, the rest of the heirs did not participate in such sale, and considering
further that the action was filed solely by the administratrix without the children being impleaded as parties
plaintis or intervenors, there is neither rhyme nor reason to hold these heirs in estoppel. For having
For August 18, 2017 executed the deed of sale, Oscar Maneclang is deemed to have assented to both
the motion for and the actual order granting the authority to sell. Estoppel operates solely against him.
3. As to prescription, this Court ruled in the Boaga case that "[a]ctions to declare the inexistence
of contracts do not prescribe (Art. 1410, N.C.C.), a principle applied even before the eectivity of the new
Civil Code (Eugenio, et al. vs. Perdido, et al., supra., citing Tipton vs. Velasco, 6 Phil. 67, and Sabas vs.
Germa, 66 Phil. 471).
4. Laches is dierent from prescription. As this Court held in Nielson & Co., Inc. vs. Lepanto
Consolidated Mining Co., 26 the defense of laches applies independently of prescription. While
prescription is concerned with the fact of delay, laches is concerned with the eect of delay. Prescription
is a matter of time; laches is principally a question of inequity of permitting a claim to be enforced, this
inequity being founded on some change in the condition of the property or the relation of the parties.
Prescription is statutory; laches is not. Laches applies in equity, whereas prescription applies at law.
Prescription is based on fixed time, laches is not.
The essential elements of laches are the following: (1) conduct on the part of the defendant, or of one
under whom he claims, giving rise to the situation of which complaint is made and for which the complaint
seeks a remedy; (2) delay in asserting the complainant's rights, the complainant having had knowledge
or notice of the defendant's conduct and having been aorded an opportunity to institute a suit; (3) lack
of knowledge or notice on the part of the defendant that the complainant would assert the right on which
he bases his suit; and (4) injury or prejudice to the defendant in the event relief is accorded to the
complainant, or the suit is not held barred. 27
In the instant case, from the time the deed of sale in favor of the City of Dagupan was executed on 4
October 1952, up to the time of the filing of the complainant for annulment on 28 September 1965, twelve For August 18, 2017 sale. Having been issued by a judge who was lawfully appointed to his position, he
(12) years, ten (10) months and twenty-four (24) days had elapsed. was disputably presumed to have acted in the lawful exercise of jurisdiction and that his ocial duty was
regularly performed. 28 It was not incumbent upon them to go beyond the order to find out if indeed there
The respective ages of the children of Margarita Suri Santos on these two dates were, more or less, as was a valid motion for authority to sell. Otherwise, no order of any court can be relied upon by the parties.
follows: Under Article 526 of the Civil Code,a possessor in good faith is one who is not aware that there exists in
his title or mode of acquisition any flaw which invalidates it; furthermore, mistake upon a doubtful or
Upon execution At the filing of dicult question of law may be the basis of good faith. It implies freedom from knowledge and
of the deed of the complaint circumstances which ought to put a person on inquiry. 29 We find no circumstance in this case to have
sale alerted the vendee, the City of Dagupan, to a possible flaw or defect in the authority of the judicial
H. Maneclang 26 39 administrator to sell the property. Since good faith is always presumed, and upon him who alleges bad
faith on the part of the possessor rests the burden of proof, 30 it was incumbent upon the administrator
87! of 105! to establish such proof, which We find to be wanting. However, Article 528 of the Civil Code provides
that: "Possession acquired in good faith does not lose this character except in the case and from the
moment facts exist which show that the possessor is not unaware that he possesses the thing improperly
Upon execution At the filing of
or wrongfully." The filing of a case alleging bad faith on the part of a vendee gives cause for cessation of
of the deed of the complaint
good faith.
sale
C. Maneclang 24 37 In Tacas vs. Tobon, 31 this Court held that if there are no other facts from which the interruption of good
O. Manaclang 22 35 faith may be determined, and an action is filed to recover possession, good faith ceases from the date of
A. Maneclang 21 34 receipt of the summons to appear at the trial and if such date does not appear in the record, that of the
filing of the answer would control.
A. Maneclang 18 31
The date of service of summons to the City of Dagupan in Civil Case No. D-1785 is not clear from the
L. Maneclang 12 25 record. Its Answer, however, was filed on 5 November 1965. Accordingly, its possession in good faith
must be considered to have lasted up to that date. As a possessor in good faith, it was entitled to all the
P. Maneclang 11 24 fruits of the property and was under no obligation to pay any rental to the intestate estate of Margarita for
the use thereof. Under Article 544 of the Civil Code,a possessor in good faith is entitled to the fruits
received before the possession is legally interrupted. Thus, the trial court committed an error when it
N. Maneclang 8 21
ordered the City of Dagupan to pay accumulated rentals in the amount of P584,602.20 from 4 October
1952 up to the filing of the complaint.
T. Maneclang 7 20
6. However, upon the filing of the Answer, the City of Dagupan already became a possessor in bad faith.
This brings Us to the issue of reasonable rentals, which the trial court fixed at P3,747.45 a month. The
It is an undisputed fact that the City of Dagupan immediately took possession of the property and basis
constructed thereon a public market; such possession was open, uninterrupted and continuous. !88 of 105!
Obviously, Hector, Cesar, Oscar and Amanda were already of legal age when the deed of sale was
executed. As it was Oscar who executed the deed of sale, he cannot be expected to renounce his own therefor is the monthly earnings of the city from the lessees of the market stalls inside the Perez Boulevard
act. With respect to Hector, Cesar and Amanda, they should have taken immediate steps to protect their Supermarket. The lessees were paying rental at the rate of P0.83 per square meter. Appellant maintains
rights. Their failure to do so for thirteen (13) years amounted to such inaction and delay as to constitute that this is both unfair and unjust. The property in question is located near the Chinese cemetery and at
laches. This conclusion, however, cannot apply to the rest of the children Adelaida, Linda, Priscila, the time of the questioned sale, it had no access to the national road, was located "in the hinterland" and,
Natividad and Teresita who were then minors and not represented by any legal representative. They as admitted by the former judicial administrator, Oscar Maneclang, the persons who built houses thereon
could not have filed an action to protect their interests; hence, neither delay nor negligence could be prior to the sale paid only P6.00 to P8.00 as monthly rentals and the total income from them amounted
attributed to them as a basis for laches. Accordingly, the estate is entitled to recover 5/9 of the questioned only to P40.00 a month. Appellant contends that it is this income which should be made the basis for
property. determining the reasonable rental for the use of the property.

5. In ruling out good faith, the trial court took into account the testimony of Oscar Maneclang to the eect
that it was Mayor Fernandez of Dagupan City and Councilor Teofilo Guadiz, Sr., both lawyers, who
induced him to sell the property and that the execution of the sale was witnessed by the City Fiscal.
We are unable to agree.
While the order granting the motion for authority to sell was actually issued on 9 September 1949, the
same was secured during the incumbency of the then judicial administrator Pedro Feliciano. Even if it is
to be assumed that Mayor Fernandez and Councilor Guadiz induced Oscar Maneclang to sell the
property, the fact remains that there was already the order authorizing the
There is merit in this contention since indeed, if the rental value of the property had increased, it would
be because of the construction by the City of Dagupan of the public market and not as a consequence of
any act imputable to the intestate estate. It cannot, however, be denied that considering that the property
is located within the city, its value would never decrease; neither can it be asserted that its price remained
constant. On the contrary, the land appreciated in value at least annually, if not monthly. It is the opinion
of this Court that the reasonable compensation for the use of the property should be fixed at P1,000.00
a month. Taking into account the fact that Severo Maneclang, insofar as his usufructuary right is
concerned, but only until his death, is precluded from assailing the sale, having been properly notified of
the motion for authority to sell and considering further that the heirs, Hector, Cesar, Oscar and Amanda,
all surnamed Maneclang, are, as discussed above, barred by laches, only those portions of the monthly
rentals which correspond to the presumptive shares of Adelaida, Linda, Priscila, Natividad and Teresita,
all surnamed Maneclang, to the extent untouched by the usufructuary right of Severo Maneclang, should
be paid by the City of Dagupan. There is no showing as to when Severo Maneclang died; this date of
death is necessary to be able to determine the cessation of his usufructuary right and the commencement
of the full enjoyment of the fruits of the property by the unaected heirs. Under the circumstances, and
for facility of computation, We hereby fix the presumptive shares in the rentals of the aforenamed
unaected heirs at P500.00 a month, or at P100.00 each, eective 5 November 1965 until the City of
Dagupan shall have eectively delivered to the intestate estate 5/9 of the property in question. The latter,
however, shall reimburse the City of Dagupan of that portion of the real estate taxes it had paid on the
land corresponding to 5/9 of the lot commencing from taxable year 1965 until said 5/9 part is eectively
delivered to the intestate estate.

For August 18, 2017

Pursuant to Article 546 of the Civil Code,the City of Dagupan may retain possession of the property until
it shall have been fully reimbursed the value of the building in the amount of P100,000.00 and 5/9 of the
purchase price amounting to P6,493.05.

WHEREFORE, judgment is hereby rendered AFFIRMING the decision in all respects, except to the
extent as above modified. As modified, (a) the sale in favor of the City of Dagupan, executed on 4 October
1952 (Exhibit "F"), is hereby declared null and void; however, by reason of estoppel and laches as
abovestated, only 5/9 of the subject property representing the presumptive shares of Adelaida, Linda,
Priscila, Natividad and Teresita, all surnamed Maneclang, may be recovered; (b) subject, however, to its
right to retain the property until it shall have been refunded the amounts of P100,000.00 and P6,493.05,
the City of Dagupan is hereby ordered to reconvey to the intestate estate of Margarita Suri Santos 5/9 of
the property in question, for which purpose said parties shall cause the appropriate partition thereof,
expenses for which shall be borne by them proportionately; and

(c) the City of Dagupan is further ordered to pay reasonable compensation for the use of 5/9 of the
property in question at the rate of P500.00 a month from 5 November 1965 until it shall have eectively
delivered the possession of the property to the intestate estate of Margarita Suri Santos. Upon the other
hand, said intestate estate is hereby ordered to refund to the City of Dagupan that portion of the real
estate taxes the latter had paid for the lot corresponding to 5/9 thereof eective taxable year 1965 and
until the latter shall have been delivered to said intestate estate.

SO ORDERED.

Gutierrez, Jr., Feliciano, Bidin and Romero, JJ ., concur.

SECOND DIVISION It appears that in the early morning of February 1, 1990, appellants Edilberto de Mesa and Gonzalo
Daleon, with the aid of several persons and without the knowledge of the Villafuertes, caused the closure
[G.R. No. 134239. May 26, 2005.] of the latter's gasoline station by constructing fences around it.

REYNALDO VILLAFUERTE and PERLITA T. VILLAFUERTE, petitioners, vs. HON. COURT OF The following day February 2, 1990 the Villafuertes countered with a complaint for damages with
APPEALS, EDILBERTO DE MESA and GONZALO DALEON, respondents. preliminary mandatory injunction against both Edilberto de Mesa and Gonzalo Daleon. Docketed in the
court below as Civil Case No. 90-11, the complaint seeks vindication for the alleged malicious and
DECISION unlawful fencing of the plaintis' business premises (Records, pp. 1-6).

CHICO-NAZARIO, J p: Invoking their status as owners of the withheld premises, the defendants admitted in their respective
answers having caused the fencing of the plaintis' gasoline station thereat but reasoned out that they
This is a petition for review on certiorari of the Decision 1 of the Court of Appeals in CA-G.R. CV No. did so on account of the plaintis' refusal to vacate the same despite demands.
41871 which armed, with modification, the decision 2 of the Regional Trial Court, Branch 55, Lucena
City, in Civil Case No. 90-11 entitled, "Reynaldo C. Villafuerte and Perlita Tan Villafuerte v. Edilberto De After hearing the parties in connection with the plaintis' application for a writ of preliminary mandatory
Mesa and Gonzalo Daleon." injunction, the lower court, in its order of May 23, 1990, ruled that with the expiration of the lease on the
!89 of 105! defendants' property, the plaintis have no more right to stay thereon and, therefore, cannot pretend to
have a clear and unmistakable right to an injunctive writ and accordingly denied their application therefore
The facts, as established by the Court of Appeals, follow: (Rec., p. 186). In a subsequent order of July 30, 1990, the same court denied the Villafuertes' motion for
reconsideration (Rec., p. 237).
Appellees the spouses Reynaldo C. Villafuerte and Perlita Tan-Villafuerte operated a gasoline
station known as Peewee's Petron Powerhouse Service Station and General Merchandise on the Later, with leave of court, the Villafuertes amended their complaint to allege, among others, that the
premises of three (3) adjoining lots at the corner of Gomez Street and Quezon Avenue in Lucena City. complained acts of the defendants cost them the following items of actual damages: IASEca
One of these lots, Lot No. 2948-A with an area of 575 square meters, is owned by several persons, one
of whom is appellant Edilberto de Mesa, while the other lot, Lot 2948-B with an area of 290 square meters, a) Daily Sales (4000-5000 lts.) at .35lt.
is owned by appellant Gonzalo Daleon and his brother Federico A. Daleon. The remaining lot belongs to mark-up, P1,750 x 270 days P472,500.00
Mrs. Anicia Yap-Tan, mother of appellee Perlita Tan-Villafuerte.
b) Storage Fee of POL (Petroleum, Oil &
Appellants Edilberto de Mesa and Gonzalo Daleon acquired their respective lots subject to the lease by Lubricants) Recom 4 at 5% for 100,000 lts.
Petrophil Corporation which had built thereon the gasoline station being managed by the Villafuerte = 5000 lts. X 3 quarters x P6.00/lt. 90,000.00
couple. When the lease of Petrophil Corporation expired on December 31, 1988, the Villafuertes obtained
a new lease on Lot No. 2948-A from appellant Edilberto de Mesa for a period expiring on December 31, c) Tires, Batteries, Accessories (TBA) Gen.
1989. Merchandise Sales, P50,000/mo. 20% mark-
Up = P10,000 x 9 months 90,000.00
"1 This lease will be for a period of one (1) year only, from January 1, 1989 and will terminate on the
31st of December 1989 at a monthly rental of FOUR THOUSAND PESOS (P4,000.00)." (Exhibit "1-A-1" d) Hauling of Petroleum products for Peewee's
De Mesa). Petron Powerhouse, 2 trips weekly, P1,500

As regards Lot 2948-B of the Daleon brothers, the Villafuertes were not as lucky. For, instead of obtaining
a lease renewal, what they received were demand letters from the brothers' counsel ordering them to X 8 trips/mo. X 9 months 108,000.00
vacate the premises. Instead of complying therewith, the Villafuertes simply ignored the demand and 90! of 105!
continued operating the gas station (Exhibits "3-B", "3-C" and "3-F", Daleon).
e) Hauling of Petroleum products for military
On May 9, 1989, in the Oce of the Barangay Captain of Barangay Tres, Lucena City, a complaint for 7 trips/qtr., P1,500/trip x 21 (3 qtrs.) 31,500.00
ejectment was filed by Gonzalo Daleon against the Villafuertes (Exhibit "6", Daleon). Evidently, no
settlement was reached thereat, as shown by a certification to file action issued by the lupon. f) Balloon Business (Sunshine Balloons)
P50,000.00 capital, P6,000/mo. Income
With their problem with the Daleon brothers far from over, the Villafuertes were apt for another one; their TOTAL LOSS 200,000.00
lease contract with Edilberto de Mesa was not renewed when it expired on December 31, 1989.
Nonetheless, and duplicating what they had done in the case of the property of the Daleon brothers, the g) Uncollected Debts 619,030.61
spouses continued to operate their gasoline station and other businesses h) Uncollected Checks 37,449.05
i) Merchandise Inventory as of July 25, 1990,
For August 18, 2017 on the lot of de Mesa despite the latter's demand to vacate. P141,036.50 value, 50% damaged 70,518.25

What transpired next lays at the core of the instant controversy. j) Damaged Oce Equipments 30,000.00
k) Stampitas (Religious Articles) and other
Hermana Fausta Memorial Foundation, Inc.
printed matters entrusted in my care, "WHEREFORE, judgment is hereby rendered in favor of the plaintis and ordering the defendants
Edliberto de Mesa and Gonzalo Daleon to pay, jointly and severally, plaintis the following:

totally damaged by rain and termites 5,000.00 1. Actual damages in the total amount of TWO MILLION ONE HUNDRED SEVENTY SIX
l) Products lost in 4 underground tanks 249,805.00 THOUSAND AND TWO HUNDRED NINETY THREE PESOS AND FORTY FOUR CENTAVOS
m) Interest payments to RCBC (Rizal Commercial (P2,176,293.44);
Banking Corporation) for additional loan
2. Moral damages in the amount of P200,000.00;

availed of to pay o products acquired on 3. Exemplary damages in the amount of P50,000.00;

credit from Petron Corp. but were held
inside gas station 172,490.53 4. P50,000.00, as and for attorney's fees; and

5. Costs of suit.
TOTAL P2,176,293.44
=========== SO ORDERED" (Rec., pp. 408-414).
(Rec., pp. 290, 300)
The trial court ruled that with the continued occupation by petitioners of the two lots belonging to private
The amended complaint thus prayed for the following reliefs: respondents, despite the expiration of the lease contracts over the same, petitioners had become
"undesirable lessees." 4 However, it was improper for private respondents to resort to fencing their
"WHEREFORE, it is respectfully prayed of this Hon. Court that judgment be rendered in favor of the properties in order to remove petitioners from the premises in the light of the clear provision of the Civil
plaintis: Code on the matter, to wit:

A Immediately ordering the issuance of a writ of preliminary mandatory injunction against the defendants Art. 536. In no case may possession be acquired through force or intimidation as long as there is a
commanding them and any person acting in their behalf to forthwith remove the fence they have possessor who objects thereto. He who believes that he has an action or a right to deprive another of the
constructed around the premises in question, and after trial making the said injunction permanent. !91 of 105!

B Ordering the defendants to pay jointly and severally the plaintis the following: holding of a thing, must invoke the aid of the competent court, if the holder should refuse to deliver the
thing.
1) Moral damages equivalent to not less than P200,000.00;
Having disregarded the plain requirement of the law, private respondents were held accountable to
2) Exemplary damages in the amount of P50,000.00; petitioners for the various damages prayed for by petitioners in their amended complaint.

3) Attorney's fee in the amount of P60,000.00 plus twenty-five percent (25%) of the amount of
damages to which plaintis are entitled; and
4) Litigation expenses in this instance in the amount of P10,000.00
C Requiring the defendants to pay jointly and severally actual damages representing unrealized income
and profits as well as losses referred to in paragraphs 10
In due time, private respondents filed their respective appeals before the Court of Appeals which armed,
with modification, the decision of the trial court. The dispositive portion of the appellate court's decision
reads:
WHEREFORE, the decision appealed from is MODIFIED by holding the appellants jointly and severally
liable to the appellees for P50,000.00 as exemplary damages and for P27,000.00 as actual damages,
itemized as follows:

For August 18, 2017 and 12 hereof in such amount as may be shown in evidence during the hearing. 1. detention of the records: P7,000.00;

D Granting the plaintis such other just and equitable remedies to which they may be entitled under the 2. detention of the merchandise: P10,000.00;
law and equity." (Orig. Rec., pp. 292-293). 3. value of the damaged merchandise and religious items: P5,000; and

As later events disclosed, the defendants resumed possession of the premises in question on January
25, 1991 (Rec., p. 333). Four (4) days later, they obtained a judgment by compromise from the Municipal
Trial Court in Cities, Lucena City in connection with the suit for ejectment they earlier filed thereat against
Petrophil Corporation. In that judgment, Petrophil bound itself to remove the materials and equipment
related to the operation of the gasoline station on the subject premises. (Rec., pp. 355-356).
After the parties herein had presented their respective evidence, the lower court came out with the
decision now under review. Dated November 13, 1990, the decision dispositively reads:
4. detention of oces equipment: P5,000.00,
and by holding the appellees jointly and severally liable for rental to appellants Edilberto de Mesa and
Gonzalo Daleon in the amount of P5,500.00 and P39,000.00, respectively.
The deficiency in the payment of the docket fees, to be computed by the clerk of court of the lower court,
shall constitute a lien on this judgment.
In adjudging private respondents liable for damages, the Court of Appeals substantially ruled that:
1. Private respondents could not invoke the doctrine of self-help contained in Article 429 of the
Civil Code 6 reasoning that the doctrine finds no application when occupation was eected through lawful
means such as in this case where petitioners' possession of the lots owned by private respondents was
eected through lease agreements;
2. Petitioners' continued unauthorized occupation of private respondents' properties may have
been illegal, however, it was incumbent upon private respondents to abide by the express provision of
Article 536 of the Civil Code requiring recourse to the proper court prior to ousting petitioners from their
(private respondents') lots;
3. On the matter of insucient docket fees paid by petitioners during the institution of this action,
the Court of Appeals declared that "whatever deficiency
For August 18, 2017 there may be in the docket fees can be levied from the amount that may be awarded
the appellees (petitioners herein)" 7 and that private respondents were already estopped from assailing
the jurisdiction of the trial court;
4. Private respondents could not invoke the principle of damnum absque injuria as this doctrine
only applies "when the loss or damage does not constitute a violation of a legal right or amounts to a
legal wrong" 8 and not to this case where private respondents clearly violated the law by unilaterally
displacing petitioners from the subject premises;
5. On the issue of actual damages, the appellate court substantially reduced the amount of actual
damages awarded by the court a quo upon the ground that petitioners failed to substantiate their claims
thereto except for the detention of petitioners' records of their receivables, various merchandise,
damaged goods, religious items, and oce equipment;
6. As for the propriety of awarding moral damages to petitioners, the Court of Appeals held that
petitioners are not entitled to this form of damage as this case does not fall within Article 2219 of the Civil
Code;
7 . Although Article 2219 of the Civil Code encompasses incidents which may fall within the purview of
Article 21 of the Civil Code, the latter, being a rule based on equity, necessitates the claimant to come to
court with clean hands which cannot be said of petitioners who continued to occupy the lands belonging
to private respondents without the authority of a subsisting lease agreement;
8. Private respondents are nevertheless liable for exemplary damages for having taken the law
into their own hands by fencing the premises of the Petron gasoline station operated by petitioners
instead of seeking redress from the proper court as mandated by Article 536 of the Civil Code; and
9. Petitioners are liable to pay private respondents for the unpaid rentals from the time the lease
agreements over the subject properties expired until 01 February 1990 when private respondents
constructed the fence.
Dissatisfied with the ruling of the Court of Appeals, petitioners are now before us raising, in the
main, the issue of whether the appellate court erred in substantially reducing the amount of damages
earlier awarded to them by the trial court.
Petitioners insist that the appellate court "resorted to assumptions, inferences, surmises and conjectures
in disallowing certain items of actual damages like lost petroleum products valued at P249,805.00, loss
of
!92 of 105!
value of merchandise detained for a quite a long time (sic) in the fenced premises and uncollected debts
as against the positive testimony of petitioner Perlita Villafuerte which remained unrebutted and
uncontested even on appeal." 9 They also allege that the list of unrealized income, collectibles and
damages prepared by petitioner Perlita was based and ably supported by documents.
Petitioners also maintain that the Court of Appeals erred in finding that they came to court with "unclean
hands," thus, depriving them of entitlement to moral damages. According to petitioners, their continued
occupation of private respondents' properties was based on their belief that their lease contract with
private respondent De Mesa was modified and extended whereas private respondent Daleon had
verbally agreed to allow them to continue with their possession of his lot for as long as the Petron
Corporation's equipment remain in the premises.
Finally, petitioners argue that the trial court was correct in awarding in their favor attorney's fees in the
amount of P50,000.00 as they were compelled to engage the services of counsel in order to seek
vindication from the arbitrary action of private respondents.
After a considered review of the records of this case, we resolve to arm, with modification, the decision
of the Court of Appeals.
Both the trial court and the Court of Appeals concluded that the lease contracts between petitioners and
private respondents over the latter's respective lots had already expired. There was also a congruence
of findings that it was wrong for private respondents to fence their properties thereby putting to a halt the
operation of petitioners' gasoline station. To this, we agree.
Article 536 of the Civil Code previously quoted explicitly provides for the proper recourse of one who
claims to be entitled to the possession of a thing. When private respondents personally took it upon
themselves to evict petitioners from their properties, which act was in clear contravention of the law, they
became liable "for all the necessary and natural consequences of [their] illegal act.
As expected, petitioners instituted this action praying that private respondents be held liable for actual
damages, moral damages, exemplary damages, attorney's fees, and costs of litigation. We shall resolve
their right to these damages in seriatim.
Actual or compensatory damages are those awarded in order to compensate a party for an injury or loss
he
For August 18, 2017 suered. They arise out of a sense of natural justice and are aimed at repairing the
wrong done. 11 Except as provided by law or by stipulation, a party is entitled to an adequate
compensation only for such pecuniary loss as he has duly proven. 12 It is hornbook doctrine that to be
able to recover actual damages, the claimant bears the onus of presenting before the court actual proof
of the damages alleged to have been suered, thus:
A party is entitled to an adequate compensation for such pecuniary loss actually suered by him as he
has duly proved. Such damages, to be recoverable, must not only be capable of proof, but must actually
be proved with a reasonable degree of certainty. We have emphasized that these damages cannot be
presumed and courts, in making an award must point out specific facts which could aord a basis for
measuring whatever compensatory or actual damages are borne.
We have exhaustively perused the records of this case and thus conclude that petitioners have miserably
failed to proer evidence capable of sustaining their plea for actual damages. We note that when
petitioner Perlita was directly examined with respect to her unrealized income 14 for the following matters,
namely: daily sales of various petroleum products; 15 storage fee of RECOM IV's petroleum, oil, and
lubricants; 16 sales of tires, batteries, accessories, and general merchandise; 17 hauling of petroleum
products for Peewee's Petron Powerhouse by the gasoline tankers owned by petitioners; 18 hauling of
petroleum products for the military; 19 and petitioner Perlita's balloon business which she conducted
within the premises of the fenced gasoline station, 20 she repeatedly testified that she arrived at these
claimed amounts based on the average of her sales for the month of January 1990, the number of trips
undertaken by their tankers, and average volume of the gasoline deposit for RECOM IV. Her testimony
on these matters went as follows:
Atty. CAMALIGAN:
May I ask that this List of Unrealized Income, Collectibles and Damages from February 1, 1990 to October
30, 1990 be marked as Exhibit AA.
xxx xxx xxx
Q: Will you explain to the court why this list you made is up to October 30, 1990?
A: I prepared this list until October 10, 1990 in preparation for our first hearing sometime in November,
sir.
Q: I am calling your attention to No. 1 which is I quote, "Daily Sales (4,000 to 5,000 liters) at P0.035 per
liter mark up P1,750.00 by 270 days amounting to P472,500.00" will you explain to the court how you
incurred this damage?
93! of 105!
(A): After the closure of our gasoline station that was February 1, 1990 and then until September, 1990
is nine (9) months and that is 270 days. I went thru my sales for January and the average sales (is) 4,000
to 5,000 liters and so for our daily sales of 4,000 to 5,000 liters sale at P0.35 centavos mark-up, I got
P1,750.00 daily so that is times 270 days until September 1990, the total is P472,500.00, sir.
COURT:
That is gross?
A: Yes, your Honor. COURT:
What about the net income to be realized?
A: Your Honor, we will deduct from here the salaries and wages of the gasoline boys and electric bill,
maybe P0.25 centavos per liter.
COURT: Proceed.
Q: Is the mark-up of P0.35 centavos per liter thru (sic), irrespective of amount of gasoline or value of
gasoline per liter?
A: We have dierent kinds of petroleum products, extra, regular and diesel and the average mark-up is
thirty-five (35) centavos.
xxx xxx xxx
Q: Calling your attention to No. 2 in the list which refers to storage fee of petroleum, oil and lubricant from
RECOM IV amounting to a total of ninety thousand pesos (P90,000.00) will you kindly explain how you
arrived at this amount?
A: The military, PC/INP RECOM IV which is stationed at Camp Nakar has entered into an agreement
with us to deposit their petroleum, oil and lubricant for every quarter, sir.
Q: Under what condition was that deposit made for? A: That they will be able to withdraw the said products
for a certain storage fee, sir, and the storage fee is 5% which would cover disposing the products and
also certain percent of evaporation. CADacT
COURT:
Five percent of what?
A: Five percent of the number of liters deposited with us so that if they deposited one hundred thousand
(100,000) liters we are paid in terms of gasoline also, five thousand (5,000) liters.
Q: What was the average volume of deposit made by the RECOM IV?
A: It is on a quarterly basis, that is one hundred thousand (100,000) liters quarterly, sir.
Q: On item 3 referring to tires, batteries, accessories, general merchandise is listed an amount of ninety
thousand (P90,000.00) pesos as your losses, will you please explain how you incurred such losses?
A: Aside from petroleum products we also sell accessories for the motoring public and they are in kinds
like tires, batteries and some additives, how do you realize income out of this? (sic)
For August 18, 2017
A: We have 20% mark-up on the merchandise and last January 1990 I average fifty thousand
(P50,000.00) pesos gross income on the general merchandise so for 20% mark-up that is more or less
ten thousand (P10,000.00) pesos and for nine (9) months that is ninety thousand (P90,000.00) pesos,
sir.
Q: In item No. 4 appearing in your list you listed a total amount of one hundred eight thousand
(P108,000.00) pesos, for hauling of petroleum products for Peewee's Petron Powerhouse, will you
explain to the court this hauling?
A: My husband and I run a fleet of gasoline tankers and they are hauling petroleum products for our
gasoline stations and for the military accounts. We average two
(2) deliveries every week so this is already a net of one thousand five hundred (P1,500.00) pesos per
delivery. It is two thousand eight hundred (P2,800.00) pesos per delivery and deducting the salaries of
the drivers, the fuel consumption and the depreciation of the tankers, we incur a net of one thousand five
hundred (P1,500.00) pesos per trip. Every month we incur at least eight (8) trips and that is one thousand
five hundred (P1,500.00) pesos times eight (8) trips times nine (9) months and I got one hundred eight
thousand (P108,000.00) pesos total.
Q: Do you own them? A: Yes, sir.
Q: In item No. 6 you listed Balloon Business under Sunshine Balloon, you have given a total amount of
two hundred thousand (P200,000.00) pesos as your losses here, will you please explain to the Court how
you incurred these losses?
xxx xxx xxx
A: Inside the gasoline station we also operate a balloon business and we have invested fifty thousand
capital on this balloon business. This business has been thriving for several years and we usually incur
six (6) thousand monthly income from said business, sir. Now that the gasoline station was closed with
all the equipments of the balloon business inside also, we have totally lost the market for the balloon
business and I feel that two hundred thousand (P200,000.00) pesos would have to be paid for the total
loss of the business.
Noticeably, petitioner Perlita's testimony was replete with claims that her unrealized income, as far as
these items were concerned, were based on the "average." Except, however, for the record of daily
petroleum sales for the month of January 1990, 22 petitioners failed to present any evidence that would
suciently establish their mean income from these business undertakings. In the absence of any
corroborative proof, this Court is not bound to award in petitioners' favor the actual damages for items a,
b, c, d, e, and f of her alleged unrealized income. Nor can we give premium on the summary of daily
petroleum sales for January 1990
!94 of 105!
prepared by petitioner Perlita as the same is not supported by any competent evidence; at best, said
exhibit is self-serving.

Anent the actual damages claimed for the deterioration of the items which remained inside petitioners'
oce, petitioner Perlita testified that when they were able to retrieve the merchandise from the gasoline
station, they noticed that most of them were already defective and so they "valued" 23 the damages
thereto at seventy (70%) of their total value. As for the items entrusted to her by the Hermana Fausta
Memorial Foundation of which she was the executive vice president at that time, petitioner Perlita alleged
that the amount of five thousand pesos represents the production cost of these materials which the
foundation purportedly paid to Imprenta Lucentina. As regards the amount of P30,000.00 sought as actual
damages for the damaged oce equipment, petitioner Perlita stated before the trial court that she arrived
at this figure after computing the acquisition costs of these equipment which she "approximated" 24 to
be P35,000.00.
Evidently, in establishing the amount of actual damages for the merchandise inventory, oce equipment,
and materials owned by the Hermana Fausta Memorial Foundation, petitioners relied solely on their own
assessment of the prices of these items as well as the damage thereto purportedly occasioned by the
fencing of the gasoline station. This is clearly demonstrated by the inconsistent stance of petitioner
Pertlita with regard to the percentage of damaged merchandise stored in the gasoline station, thus:
ATTY. CAMALIGAN:
Q: I noticed that the total appearing on page 3 of your merchandize inventory is one hundred forty one
thousand thirty six pesos and fifty centavos (P141,036.50) only while in your list, it is ninety eight thousand
seven hundred twenty five pesos and fifty five centavos (P98,725.55), will you please explain the same?
WITNESS:
A: This list with the total amount of one hundred forty one thousand thirty six pesos and fifty centavos
(P141,036.50) represent the total value of all the merchandize but then the reason why we have the
ninety eight thousand seven hundred twenty five pesos and fifty five centavos (P98,725.55) figure is, this
represents seventy percent (70%) of the total amount because when we retrieved the merchandize, we
noticed that most of them are already defective, so we valued the damages only seventy percent (70%)
of the total value because some of them could still be sold, sir.
For August 18, 2017
ATTY. CAMALIGAN:
Q: I noticed there is a correction in Item No. 9 from ninety percent (90%) to seventy percent (70%). When
did you make that correction?
A: Only last December 30, 1990 after we have retrieved all the merchandize. I prepared this list on
October 31, 1990 not realizing the extent of the real damages to the merchandize but when we retrieved
them last December 29 and upon inspection, most of the motor oil have already leaked because of the
plastics that were exposed to sun and rain, so we changed the estimate to seventy percent (70%), sir.
25
Such arbitrary estimations run afoul with our consistent pronouncement that actual or compensatory
damages cannot be presumed but must be proved with reasonable degree of certainty. 26 A court cannot
simply rely on speculation, conjecture or guesswork as to the fact and amount of damages, but is required
to depend upon competent proof that the claimant had suered and on evidence of the actual amount
thereof. 27 Failing in this regard, we resolve to delete the award of actual damages rendered by the Court
of Appeals with respect to these items.
Similarly, we rule that petitioners are not entitled to the total amount of the 17 checks issued in their favor
by their customers and to the amount of uncollected debts owed to them by their patrons. Petitioners
maintain that their customers were used to coming to their gasoline station in order to settle their
obligations but were prevented from doing after the 01 February 1990 incident. They therefore would like
to hold private respondents accountable for these receivables. This, we can not grant.
The records indicate that petitioners filed before the trial court a motion to allow them to enter the gasoline
station subject of this dispute in order to make an inventory of their property that were locked inside and
to remove those they needed for their personal use. 28 Among the items removed from the gasoline
station were the receipts evidencing petitioners' receivables from their customers 29 as well as the 17
uncollected checks. 30 Obviously, after the court-approved ocular inspection conducted on 24 July 1990
and 25 July 1990, petitioners were already in possession of the evidences of credit of their customers.
There was nothing, not even the closure of their gasoline station, which stood in the way of petitioners'
exerting earnest eorts in going after their debtors.
Petitioners likewise seek to be compensated for the value of the petroleum products allegedly lost from
the four underground tanks between the period 01 February 1990 until 25 July 1990 when an ocular
!95 of 105!
inspection was conducted within the disputed property. According to petitioners, after they compared the
volume of the tanks' contents as of the evening of 31 January 1990 with the dipstick reading on 25 July
1990, they discovered that they had lost thousands of liters of petroleum products. On this point, we
quote with approval the conclusion of the Court of Appeals, to wit:
The appellees 31 failed to adduce convincing evidence that appellants are the ones responsible for the
loss of the petroleum products in the four (4) underground tanks (item "1," paragraph 10 of Amended
Complaint). Although the premises which were fenced by the appellants 32 adjoin the lot of Perlita's
mother and are even secured by appellees' guard, the appellees did not present anyone to testify on the
fact of loss of said gasoline products. Instead, they chose to rely on Perlita's bare assertion that she lost
P249,805.00 in terms of petroleum products that allegedly disappeared. The sheer volume of the missing
fuel makes it dicult for the pilferer to commit the deed without attracting attention. An unsubstantiated
claim of loss, more so of such a dimension, cannot merit an award therefor.
Finally, with respect to the interest payments to the Rizal Commercial Banking Corporation (RCBC),
petitioners maintain that because of the fencing of their gasoline station on 01 February 1990, they were
forced to obtain a loan from RCBC in order to pay o their obligations to dierent suppliers. This
contention was eectively refuted by petitioner Perlita herself when, during her re-direct examination, she
admitted that the loan granted by the RCBC was intended for all the businesses that she and her
husband, petitioner Reynaldo, were maintaining. 34 It would, therefore, be iniquitous to charge private
respondents for the interest payments for this loan the proceeds of which were utilized to finance
petitioners' various businesses and not solely the settlement of petitioners' obligations to the suppliers of
Peewee's Petron Powerhouse. In the absence of actual proof as to how much of the RCBC loan was
really used to pay the creditors of the closed gasoline station, this Court can not arm petitioners' right
to be compensated for the amount of interest payments they have made to the RCBC.
We find, however, that an award of temperate damages to petitioners is in order. In lieu of actual
damages, temperate damages, which are more than nominal but less than compensatory damages, may
be awarded where the court finds that some pecuniary loss had been suered by the claimant but its
amount cannot be proved with certainty. Undoubtedly, pecuniary loss had been inflicted upon petitioners
in this case, however, due to the insuciency of evidence before us, we
For August 18, 2017 cannot place its amount with certainty. In this regard, we find the amount of
P50,000.00 to be sucient.
Petitioners also assail the removal by the Court of Appeals of the moral damages previously ordered by
the trial court. They argue that contrary to the findings of the appellate court, they came to court with
"clean hands" as they believed that the lease contract with private respondent De Mesa was modified
and extended. At the same time, they contend that they had a verbal understanding with private
respondent Daleon wherein the latter permitted them to remain in his lot for as long as Petron Corporation
was not removing its equipment. Further, petitioners contend that under Article 2219 of the Civil Code, WHEREFORE, the Decision of the Court of Appeals dated 31 March 1998, which modified the Decision
this Court had awarded moral damages in instances where the claimants were victims of capricious, dated 13 November 1992 of the Regional Trial Court, Branch 55, Lucena City, and its Resolution of 17
wanton, oppressive, malicious, and arbitrary acts such as petitioners in this case. On this issue, we agree June 1993 denying reconsideration are hereby MODIFIED as follows:
in the findings of the Court of Appeals that:
1. The award of Twenty-Seven Thousand Pesos (P27,000.00) as actual damages in favor of
The Court must have to disallow the lower court's award of moral damages. The concept of moral petitioners Reynaldo and Perlita Villafuerte is deleted; and
damages, as announced in Article 2217 of the Civil Code, is designed to compensate the complainant
for his physical suering, mental anguish, fright, serious anxiety, besmirched reputation, wounded 2. Private respondents Edilberto De Mesa and Gonzalo Daleon are held jointly and severally
feelings, moral shock, social humiliation and similar injury occasioned by the defendant's wrongful act or liable to pay petitioners the amount of Fifty Thousand Pesos (P50,000.00) as temperate damages.
omission. Article 2219 of the same Code specifies the cases where moral damages may be awarded, to
wit: The remainder of the same Decision and Resolution of the Court of Appeals are hereby AFFIRMED. No
costs. SO ORDERED.
Art. 2219. Moral damages may be recovered in the following and analogous cases:
(1) A criminal oense resulting in physical injuries; For August 18, 2017
(2) Quasi-delicts causing physical injuries;
(3) Seduction, abduction, rape, or other lascivious acts; Puno, Austria-Martinez and Callejo, Sr., JJ., concur. Tinga, J., is out of the country.
(4) Adultery or concubinage;
(5) Illegal or arbitrary detention or arrest;
(6) Illegal search;
(7) Libel, slander or any other form of defamation;
(8) Malicious prosecution;
(9) Acts mentioned in article 309;
(10) Acts and actions referred to in articles 21, 26, 27, 28, 29, 30, 32, 34, and 35.

The parents of the female seduced, abducted, raped or abused, referred to in No. 3 of this article, may
also recover moral damages.

The spouse, descendants, ascendants, and brothers and sisters may bring the action mentioned in No.
9 of this article, in the order named.

Noticeably, none of the foregoing instances has any relevant bearing to the case at bench. While Article
2219 comprehends the situation in Article 21 of the
!96 of 105!

Code, whereunder "[A]ny person who willfully causes loss or injury to another in a manner that is contrary
to morals, good customs or public policy shall compensate the latter for the damages," the appellees
cannot benefit from it. The right to recover moral damages under Article 21 is based on equity, and those
who come to court to demand equity must come with clean hands (Garciano v. Court of Appeals, 212
SCRA 436 citing Padilla, CIVIL CODE ANNOTATED, Vol. 1, 1975 Ed., p. 87). The appellees knew that
their lease had expired. Yet, despite such awareness, they persisted in their unauthorized occupancy of
appellants' property. Being partly responsible for their present predicament which is very much within
their p o w e r t o a v o i d , a p p e l l e e s c a n n o t re c e i v e compensation for whatever mental
anguish or suering they went thru.

Similarly, we uphold the award of P50,000.00 as exemplary damages in order to deter similarly minded
individuals from pursuing the course of action taken by private respondents. The law on this matter is
clear: "(h)e who believes himself entitled to deprive another of the possession of a thing, so long as the
possessor refuses delivery, must request the assistance of the proper authority." 36 Petitioners' arbitrary
conduct of fencing their properties under the claim that they own the same brazenly violates the law and
circumvents the proper procedure which should be obtained before the court.

This Court likewise adopts the conclusion reached by the Court of Appeals that petitioners do not deserve
the award of attorney's fees for it was precisely their unfounded insistence to stay on private respondents'
properties that precipitated this suit.
FIRST DIVISION
[G.R. No. 156581. September 30, 2005.] VICTORIA R. ARAMBULO and MIGUEL R. ARAMBULO III,
petitioners, vs. EMERENCIANA R. GUNGAB, respondent.
DECISION
QUISUMBING, J p:
For review on certiorari are the Decision 1 dated August 30, 2002 of the Court of Appeals in CA-G.R. SP
No. 65042, and its Resolution 2 dated January 6, 2003, denying the motion for reconsideration. The Court
of Appeals ordered petitioners to vacate the property subject of this case. The assailed Decision reversed
and set aside the decision 3 of the Regional Trial Court (RTC) which armed the joint decision 4 of the
Metropolitan Trial Court (MeTC) in two ejectment cases filed by respondent.
The facts are as follows:
Respondent Emerenciana R. Gungab is the registered owner of the contested parcel of land with
improvements located in Quezon City and covered by Transfer Certificate of Title (TCT) No. 48330.
Petitioners are her sister Victoria R. Arambulo and nephew Miguel R. Arambulo III.
In separate letters 5 dated October 19, 1998, respondent's counsel made a formal demand to petitioners
to vacate the subject property on or before November 30, 1998. Petitioners refused.
Respondent sought the assistance of the barangay authorities. However, no amicable settlement was
reached.
On February 2, 1999, respondent filed separate ejectment complaints against the petitioners before the
MeTC of Quezon City, docketed as Civil Case Nos. 21855 7 and 21856. 8 Respondent alleged (1) that
she owns the subject property; (2) that she tolerated petitioners' occupancy of certain portions of the
subject property without rent; and (3) that despite her demands, they refused to vacate the subject
property.
Petitioners denied respondent's claim of sole ownership of the subject property, asserting that petitioner
Victoria Arambulo is a co-owner. They stated
(1) that after Pedro Reyes, father of respondent Emerenciana and petitioner Victoria, died intestate in
1964, the property became part of the common
!97 of 105!
properties of the Reyes clan; (2) that during her lifetime, Anastacia Reyes, wife of Pedro, allowed her
daughter, petitioner Victoria, to use and occupy a certain portion of the subject property; (3) that Victoria
continuously used and occupied this portion for the last 20 years; (4) that Anastacia also allowed her
grandson, petitioner Miguel, to use another portion of the subject property since 15 years ago; and (5)
that their "use and possession" of these portions of the subject property "had been with the knowledge,
consent and tolerance of all the other co-owners."
Aside from these ejectment cases, there is also a pending case for annulment of transfer and
reconveyance of title before the RTC of Quezon City, which Victoria and three of her brothers filed against
respondent and her husband.
In its joint decision, 10 the MeTC of Quezon City, Branch 39, dismissed the ejectment cases for lack of
cause of action. It ruled that summary procedure was not the proper procedure to resolve the cases. This
ruling was based on its findings (1) that respondent's allegation of tolerance was preposterous since she
failed to prove her proper acquisition of the subject property; and (2) that petitioners were entitled to retain
possession of the subject property pursuant to Article 448 11 of the Civil Code.
Respondent appealed, but the RTC of Quezon City, Branch 80, upheld the MeTC's judgment, in toto. 12
After her motion for reconsideration was denied, respondent filed a petition for review with the Court of
Appeals, which it disposed of as follows:
UPON THE VIEW WE TAKE OF THIS CASE, THUS, the judgment appealed from must be, as it is
hereby, REVERSED and SET ASIDE, and a new one entered ordering [petitioners] to vacate the portion
of the subject property under their occupancy or possession, and to surrender the same forthwith to
[respondent]. Without special pronouncement as to costs.
SO ORDERED.
In reversing the RTC, the Court of Appeals, observing that both parties raised the issue of ownership,
provisionally resolved said issue to determine the issue of possession. It noted the failure of the MeTC
and RTC to evaluate thoroughly the pieces of evidence submitted by the parties. The Court of Appeals
held that respondent had a preferred right to possess the property because she had a genuine TCT. It
rejected for being unsubstantiated, petitioners' claim that Victoria was a co-owner of the subject property.
For August 18, 2017
The Court of Appeals denied petitioners' motion for reconsideration.
Hence, this petition. Petitioners allege that:
(1) THE HONORABLE COURT OF APPEALS COMMITTED SERIOUS ERROR IN RELYING
SOLELY ON THE TRANSFER CERTIFICATE OF TITLE IN THE NAME OF RESPONDENT IN
REVERSING THE DECISION RENDERED BY THE REGIONAL TRIAL COURT OF QUEZON CITY.
(2) THE HONORABLE COURT OF APPEALS
COMMITTEDMANIFESTERRORINNOTCONSIDERINGTHECLEARFAC
T T H A T RESPONDENT WAS NEVER IN POSSESSION OF THE PROPERTY IN QUESTION AND
ACCORDINGLY, THERE IS NO PHYSICAL POSSESSION TO RESTORE AND PROTECT.
(3) THE HONORABLE COURT OF APPEALS IGNORED THE CLEAR FACT THAT THERE ARE
EQUITABLE AND SPECIAL CIRCUMSTANCES OBTAINING BETWEEN THE PARTIES,
PARTICULARLY THE INTENDED SALE OF THE SUBJECT PROPERTY BY THE RESPONDENT, T H
AT I S L I K E LY T O C R E AT E C O N F U S I O N , DISTURBANCE, AND EVEN BLOOD-SHED,
WHICH WILL JUSTIFY THE SUSPENSION OF THE DECISION IN THE UNLAWFUL DETAINER CASE
RENDERED BY THE HONORABLE COURT OF APPEALS TO AWAIT THE DISPOSITION IN THE
PENDING CIVIL ACTION F O R A N N U L M E N T O F T R A N S F E R A N D R E C O N V E YA N C
E O F T I T L E O F T H E S A M E PROPERTY.
(4) THE HONORABLE COURT OF APPEALS ERRED IN RENDERING THE APPEALED DECISION
NOT IN ACCORD WITH LAW, EVIDENCE AND FACTS OF THE CASE.
The sole issue is, can respondent eject petitioners? Petitioners contend that the Court of Appeals erred
in reversing the RTC by relying only on respondent's TCT without considering that respondent was never
in possession of the property. They insist that they were in possession of the subject property and so
there was no physical possession to restore and protect. They pray that the Court suspend the Court of
Appeals' Decision pending resolution of the case for annulment of transfer and reconveyance of title
before the RTC.
Respondent counters that the Court of Appeals correctly reversed the decision of the RTC since the best
proof of ownership of a piece of land is the certificate of title. She maintains that a pending civil action for
annulment of transfer and reconveyance of
!98 of 105!
title in a separate proceeding is of no moment in an ejectment case.
Pertinent to the instant case are the summary remedies of forcible entry and unlawful detainer under
Section 1, Rule 70 15 of the Rules of Court. They are distinguished from each other as follows:
. . . In forcible entry, one is deprived of physical possession of land or building by means of force,
intimidation, threat, strategy, or stealth. In unlawful detainer, one unlawfully withholds possession thereof
after the expiration or termination of his right to hold possession under any contract, express or implied.
In forcible entry, the possession is illegal from the beginning and the basic inquiry centers on who has
the prior possession de facto. In unlawful detainer, the possession was originally lawful but became
unlawful by the expiration or termination of the right to possess, hence the issue of rightful possession is
decisive for, in such action, the defendant is in actual possession and the plainti's cause of action is the
termination of the defendant's right to continue in possession.
What determines the cause of action is the nature of defendant's entry into the land. If the entry is illegal,
then the action which may be filed against the intruder within one year therefrom is forcible entry. If, on
the other hand, the entry is legal but the possession thereafter became illegal, the case is one of unlawful
detainer which must be filed within one year from the date of the last demand.
Here, respondent's cause of action was not deprivation of possession of the subject property by force,
intimidation, threat, strategy or stealth. Rather, these were for unlawful detainer since respondent alleged
that (1) she owns the subject property; (2) she allowed petitioners to occupy it by tolerance; (3) she
withdrew her consent and demanded that petitioners vacate it, but they refused. Her complaints were
also filed within one year from the date of her last demand.
The sole issue for resolution in an unlawful detainer case is physical or material possession. 17 But even
if there was a claim of juridical possession or an assertion of ownership by the defendant, the MeTC may
still take cognizance of the case. All that the trial court can do is to make an initial determination of who
is the owner of the property so that it can resolve who is entitled to its possession absent other evidence
to resolve ownership. 18 Courts in ejectment cases decide questions of ownership only as it is necessary
to decide the question of possession. The reason for this rule is to prevent the defendant from trifling with
the summary nature of an ejectment suit by the simple
and withdrew her tolerance later on, petitioners' refusal to vacate it rendered their possession thereof
unlawful.
Since petitioners' occupation of the subject property was by mere tolerance, they are not entitled to retain
its possession under Article 448 23 of the Civil Code. They are aware that their tolerated possession may
be terminated any time and they cannot be considered as builders in good faith. 24 Moreover, as aptly
found by the Court of Appeals, petitioners have not presented evidence to prove that they made
improvements on the subject property and defrayed the expenses therefor.
We also cannot sustain petitioners' contention that since they had possession of the subject property,
they are entitled to remain there. Again, they confuse unlawful detainer with forcible entry. Prior physical
possession by the plainti is not necessary in an unlawful detainer case. It is enough that she has a better
right of possession. Prior physical possession of a property by a party is indispensable only in forcible
entry cases. 25 In unlawful detainer cases, the defendant is necessarily in prior lawful possession of the
property, but his possession eventually becomes unlawful upon termination or expiration of his right to
possess. Thus, petitioners' prior physical possession of
!99 of 105!
the property does not automatically entitle them to continue in said possession and does not give them
a better right to the property.
Finally, petitioners cannot seek suspension of this case pending resolution of the case for annulment of
transfer and reconveyance of title before the RTC. An action for reconveyance of property or accion
reivindicatoria has no eect on ejectment suits regarding the same property. Neither do suits for
annulment of sale, or title, or document aecting property operate to abate ejectment actions respecting
the same property.
This case involves sisters and one of the sister's sons. However, we are constrained to arm the Court
of Appeals' Decision, mindful of the circumstances of this case. The alleged intended sale of the subject
property cannot likewise justify suspending this case. We found no factual basis for this allegation, which
was not even brought before the MeTC and RTC, but was only brought to the Court of Appeals in
petitioners' motion for reconsideration.
WHEREFORE, the petition is DENIED. The Decision dated August 30, 2002 and Resolution dated
January 6, 2003 of the Court of Appeals are AFFIRMED. aIDHET SO ORDERED.
Davide, Jr., C.J., Ynares-Santiago, Carpio and Azcuna, JJ., concur.

For August 18, 2017 expedient of asserting ownership over the disputed property. SECOND DIVISION

In this case, the evidence showed that respondent has a Torrens Title over the land. The Court of Appeals
correctly ruled that respondent, as registered owner, is preferred to possess it. The age-old rule is that
the person who has a Torrens Title over a land is entitled to possession thereof. 20 Except for petitioners'
unsubstantiated claim that Victoria Arambulo is a co-owner of the property, they have not presented other
justification for their continued stay thereon.

We stress, however, that this determination of ownership is not final. It is only an initial determination of
ownership for the sole purpose of settling the issue of possession. It would not prejudice the pending
action in the RTC of Quezon City between the same parties involving title to the property.

Persons who occupy the land of another at the latter's tolerance or permission, without any contract
between them is bound by an implied promise that they will vacate the same upon demand, failing which
a summary action for ejectment is the proper remedy against them. 22 Notably, Anastacia Reyes only
allowed petitioners to use and occupy certain portions of the subject property. They admitted their "use
and possession" of these portions of the subject property "had been with the knowledge, consent and
tolerance of all the other co-owners." Consequently, after respondent obtained title to the subject property
[G.R. No. 150025. July 23, 2008.]
SPS. NARCISO BARNACHEA and JULITA BARNACHEA (now heirs of deceased Julita Barnachea),
petitioners, vs. HON. COURT OF APPEALS, HON. OSCAR C. HERRERA, JR., Presiding Judge, RTC
Branch 20, Malolos, Bulacan, HON., HORACIO T. VIOLA, Presiding Judge, MTC Pulilan, Bulacan, and
SPS. AVELINO and PRISCILLA IGNACIO, respondents.
DECISION
BRION, J p:
Before us is the Petition for Review by Certiorari filed by the spouses Narciso and Julita Barnachea 1
(petitioners) against the spouses Avelino and Priscilla Ignacio (respondents), rooted in the ejectment
complaint the respondents filed against the petitioners before the Municipal Trial Court (MTC) of Pulilan,
Bulacan. The petition prays that we nullify the Decision 2 of the Court of Appeals (CA) and its Resolution
3 denying the motion for reconsideration, and that we suspend the ejectment proceedings in light of a
pending action for quieting of title involving the disputed property.
For August 18, 2017
BACKGROUND FACTS
The respondents filed their complaint for ejectment against the petitioners before the MTC on October
20, 1998. The subject matter of the complaint were lots titled in respondent Avelino Ignacio's name
(Subdivision Lot 16 covered by TCT No. 86821, and Subdivision Lot 17 covered by TCT No. 86822),
which lots are adjacent to the property that the petitioners own and occupy. These properties were
originally part of a piece of land owned by a certain Luis Santos and subsequently inherited by his
daughter Purificacion Santos Imperial. The land was subdivided and transferred to tenant-farmers
Santiago Isidro (EP No. A-050545 with TCT No. T-188-EP) and Procopio de Guzman (EP No. 445440
with TCT No. T-185-EP). The property that the petitioners own and occupy was derived from the land
transferred to Santiago Isidro. Respondent Ignacio's properties were derived, on the other hand, from the
land originally transferred to Procopio de Guzman.
The complaint was dismissed on December 8, 1999, but was revived on April 5, 2000. The petitioners
received summons on April 13, 2000 and, instead of filing a new Answer, filed on April 18, 2000 a Motion
for Extension of Time to File Answer which the MTC denied on May 5, 2000. The petitioners responded
to this denial by filing a motion for reconsideration on May 23, 2000. Meanwhile, the respondents filed a
Motion for the Issuance of a Writ of Execution dated May 24, 2000, which the petitioners received on May
26, 2000.
To avert the implementation of the writ of execution, the petitioners filed a Notice of Appeal. The MTC
issued a subpoena dated June 5, 2000 setting the hearing on the petitioners' Motion for Reconsideration
and the respondents' Motion for Issuance of Writ of Execution on June 19, 2000. The petitioners
subsequently filed a Compliance that prayed, among others, that the pending resolution on the incident
and the Notice of Appeal be deemed to have been filed ex abundanti cautela. The respondents, for their
part, filed a Manifestation and Motion praying, among others, that the petitioner's Motion for
Reconsideration of the May 5, 2000 Order be denied for being moot and academic. On July 21, 2000,
the MTC issued an order declaring the petitioners' Motion for Reconsideration abandoned because of
the Notice of Appeal they previously filed. Thereafter, the MTC forwarded the entire record of Civil Case
No. 818 to the Regional Trial Court, Branch 20 (RTC Branch 20), Malolos, Bulacan. On August 24, 2000,
petitioners submitted their Appeal Memorandum to the RTC Branch 20 which armed the MTC decision
on September 20, 2000.
!100 of 105!
On October 5, 2000, the petitioner Julita's sister, Leticia, representing herself to be the sole owner of EP
No. A-050545 (TCT No. T-188-EP), filed a Petition for Quieting of Title with the Regional Trial Court,
Branch 19 (RTC Branch 19), Malolos, Bulacan, docketed as Civil Case No. 694-M-2000. On October 9,
2000, prior to their receipt of the RTC Branch 20's September 20, 2000 decision, the petitioners filed an
Urgent Motion for the Suspension of Proceedings (referred to for purposes of this decision as the urgent
motion).
RTC Branch 20 denied on October 17, 2000 the petitioners' urgent motion and their subsequent Motion
for Reconsideration. The petitioners brought the denials to the CA via a petition for certiorari under Rule
65 of the Rules of Court on the issue of "whether the pendency of an action involving the issue of
ownership is sucient basis for [the] suspension of an ejectment proceeding between the same parties
and relating to the same subject matter.
THE CA'S DECISION
The CA denied the petition and the petitioners' subsequent motion for reconsideration, essentially on the
grounds that (1) the issue in an ejectment suit is limited to the physical possession of real property and
is separate and distinct from the issue of ownership and possession de jure that either party may set forth
in his or her pleading; (2) the pendency of an action for reconveyance of title over the same property or
for annulment of deed of sale does not divest the MTC of its jurisdiction to try the forcible entry or unlawful
detainer case before it, and that ejectment actions generally cannot be suspended pending the resolution
of a case for quieting of title between the same parties over the same subject property; and (3) the case
does not fall under the exception provided by the case of Amagan v. Marayag, 4 where the Court allowed
the suspension of ejectment proceedings because of strong reasons of equity applicable to the case
the demolition of the petitioner's house unless the proceedings would be suspended. The CA ruled that
the petitioners' reliance on Amagan was inappropriate because the said case only applies to unlawful
detainer actions while the petitioners' ejectment suit is an action for forcible entry. To the CA, the initial
tolerance on the part of the private respondents did not convert the nature of their ejectment suit from
forcible entry into unlawful detainer, following the reasoning this Court applied in Munoz v. Court of
Appeals.
ASSIGNMENT OF ERRORS
The petitioners impute the following error to the CA: [T]he Honorable Court of Appeals erred when it ruled
that the said ejectment proceeding was not a suit for
For August 18, 2017 illegal detainer but one of forcible entry, thus, denied application to the exceptional
rule on suspension of ejectment proceedings, at any stage thereof, until the action on ownership is finally
settled.
From this general assignment of error, the petitioners submitted in their memorandum the following
specific issues for our resolution:
1) whether or not the ejectment case filed by the respondents against petitioners with the MTC of
Pulilan is for unlawful detainer or for forcible entry;
2) whether the MTC of Pulilan had validly acquired and exercised jurisdiction over the ejectment
case considering that the complaint was filed beyond one year from the demand to vacate the subject
premises; and
3) whether or not the ejectment proceedings should be suspended at any stage until the action
on ownership of the disputed portion of the subject property is finally settled.
OUR RULING
We find the petition without merit.
1. Nature of the Action before the MTC.

The best indicator of what the plainti in an ejectment case intends with respect to the nature of his or
her complaint can be found in the complaint itself. In this case, the complaint states:
"That plaintis are the registered owners in fee simple of several residential lots identified as lots 16 and
17 covered by Certificate of Title Nos. 86821 and 86822 issued in the name of the spouses by the
Register of Deeds of Bulacan, with a total aggregate area of 254 square meters situated at Cutcut,
Pulilan, Bulacan. Copy of the said titles are hereto attached and marked as Annex "A" and A-1"
"That in a portion of the lots 16 and 17, a portion of the house of the defendants was erected and built
thus usurping the said portion and this was made known to the defendants when the plaintis caused the
relocation of the subject lots, however, considering that the latter were not yet in need of that portion,
they allowed the former to stay on the portion by tolerance; "That last July 1998, when the plaintis were
in the process of fencing the boundary of their lots, to their surprise, they were not allowed by the
defendants to extend the fence up to the portions they illegally occupied;
!101 of 105!
"That despite the advice given to them by several Geodetic Engineers commissioned by both the plaintis
and the herein defendants, for them to give way and allow the plaintis to fence their lot, same proved
futile as they stubbornly refused to surrender possession of the subject portion;
The actions for forcible entry and unlawful detainer are similar because they are both summary actions
where the issue is purely physical possession. 8 Other than these commonalities, however, they possess
dissimilarities that are clear, distinct, and well established in law.
In forcible entry, (1) the plainti must prove that he was in prior physical possession of the property until
he was deprived of possession by the defendant; (2) the defendant secures possession of the disputed
property from the plainti by means of force, intimidation, threat, strategy or stealth; hence, his
possession is unlawful from the beginning; (3) the law does not require a previous demand by the plainti
for the defendant to vacate the premises; and (4) the action can be brought only within one-year from the
date the defendant actually and illegally entered the property.
In marked contrast, unlawful detainer is attended by the following features: (1) prior possession of the
property by the plainti is not necessary; (2) possession of the property by the defendant at the start is
legal but the possession becomes illegal by reason of the termination of his right to possession based on
his or her contract or other arrangement with the plainti; (3) the plainti is required by law to make a
demand as a jurisdictional requirement; and (4) the one-year period to bring the complaint is counted
from the date of the plainti's last demand on the defendant.
Under these standards, we do not hesitate to declare the Court of Appeals in error when it held that the
present case involves forcible entry rather than unlawful detainer. A plain reading of the complaint shows
the respondents' positions that the petitioners were in prior possession of the disputed property; that the
respondents allowed them to occupy the disputed property by tolerance; that the respondents eventually
made a demand that the petitioners vacate the property (on August 26, 1998, which demand the
petitioners received on August 31, 1998); and that the petitioners refused to vacate the property in light
of the defenses they presented. Separately from the complaint, the respondents characterized the action
they filed against the petitioners in the MTC as an unlawful detainer when they stated in their
memorandum that "as alleged in the complaint, what was filed by the respondents [was] an ejectment
suit for unlawful detainer."
For August 18, 2017
A critical point for us in arriving at our conclusion is the complete absence of any allegation of force,
intimidation, strategy or stealth in the complaint with respect to the petitioners' possession of the
respondents' property. While admittedly no express contract existed between the parties regarding the
petitioners' possession, the absence does not signify an illegality in the entry nor an entry by force,
intimidation, strategy or stealth that would characterize the entry as forcible. It has been held that a person
who occupies land of another at the latter's tolerance or permission, without any contract between them,
is necessarily bound by an implied promise that he will vacate upon demand, failing which a summary
action for ejectment is the proper remedy. The status of the defendant is analogous to that of a lessee or
tenant whose terms has expired but whose occupancy continues by tolerance of the owner.
To be sure, we are aware of the Munoz v. Court of Appeals 14 ruling that the CA relied upon to reach the
conclusion that the present case involves forcible entry, not unlawful detainer. What the CA apparently
misread in Munoz was the allegation of stealth in the complaint; anchored on this finding, the Court
concluded that the defendant's possession was illegal from the beginning so that there could be no
possession by tolerance. The allegation of stealth, of course, is not present in the present case. On the
contrary, tolerance was alleged in the ejectment complaint itself. Thus, there is no reason for the Munoz
ruling to apply to the present case; there is no basis nor occasion to conclude that the respondents filed
a forcible entry case.
2. The Jurisdictional Issue
Was the Ejectment Complaint
Seasonably Filed?
We point out at the outset that what the petitioners directly appealed to this Court is the appellate court's
armation of the RTC's refusal to suspend the ejectment proceedings based on the quieting of title case
the petitioners cited. Hence, we are not reviewing the merits of the main ejectment case, particularly the
question of the MTC's jurisdiction, as these aspects of the case were not appealed to us. If we touch the
jurisdictional aspect of the case at all, it is only for purposes of fully responding to the parties' arguments.
The petitioners' jurisdictional argument cannot succeed as the respondents' ejectment complaint was
filed within the one-year period for bringing an action for unlawful detainer or forcible entry that Section
1, Rule 70 of the Rules of Court requires. Section 1 specifically states:
!102 of 105!
Section 1. Who may institute proceedings, and when.
Subject to the provisions of the next succeeding section, a person deprived of the possession of any land
or building by force, intimidation, threat, strategy, or stealth, or a lessor, vendor, vendee, or other person
against whom the possession of any land or building is unlawfully withheld after the expiration or
termination of the right to hold possession, by virtue of any contract, express or implied, or the legal
representatives or assigns of any such lessor, vendor, vendee, or other person, may, at any time within
one (1) year after such unlawful deprivation or withholding of possession, bring an action in the proper
Municipal Trial Court against the person or persons unlawfully withholding or depriving of possession, or
any person or persons claiming under them, for the restitution of such possession, together with damages
and costs.
On the basis of this provision, the petitioners argue that the respondents' cause of action whether for
forcible entry or for unlawful detainer had prescribed when the ejectment complaint was filed on April
5, 2000. They point out that the last demand letter (the reckoning date for unlawful detainer) 15 was dated
Aug. 26, 1998 and was received by the petitioners on August 31, 1998; the complaint was only filed on
April 5, 2000 or more than 1 year after August 31, 1998. On the other hand, if the action had been for
forcible entry, the prescriptive period commenced on the discovery of the usurpation and the computation
period would have commenced either during the relocation survey of the lots or in July 1998 when the
respondents were prevented from fencing the disputed property.
The one-year period within which to commence an ejectment proceeding is a prescriptive period as well
as a jurisdictional requirement. Hence, Article 1155 of the Civil Code on the manner of reckoning the
prescriptive period must necessarily come into play. Under this Article, the filing of a complaint in court
interrupts the running of prescription of actions. As an action for unlawful detainer, the one-year
prescription period started running after August 31, 1998 the date of receipt of the respondents'
demand letter. The period ran for almost two months until it was interrupted on October 20, 1998 when
the respondents filed their ejectment complaint. This complaint, however, was dismissed on December
8, 1999. Upon this dismissal, the prescriptive period again began to run for about four months when
another interruption intervened the revival of the complaint on April 5, 2000. Evidently, under these
undisputed facts, the period when the prescriptive period eectively ran does not add up to the one - year
prescriptive period that would jurisdictionally bar the ejectment case.
For August 18, 2017
3. Suspension of the Ejectment Proceedings until Resolution of the Ownership Issue.
The issue in an unlawful detainer case is limited to physical possession. When a claim of ownership is
used as a basis for de facto possession or to assert a better possessory right, the court hearing the case
may provisionally rule on the issue of ownership. As a rule, however, a pending civil action involving
ownership of the same property does not justify the suspension of the ejectment proceedings. Only in
rare cases has this Court allowed a suspension of the ejectment proceedings and one of these is in the
case of Amagan v. Marayag 16 that the petitioners cite. To quote from Amagan
[i]ndisputably, the execution of the MCTC Decision would have resulted in the demolition of the house
subject of the ejectment suit; thus, by parity of reasoning, considerations of equity require suspension of
the ejectment proceedings. . . . [L]ike Vda. de Legaspi, the respondent's suit is one of unlawful detainer
and not of forcible entry, and most certainly, the ejectment of petitioners would mean a demolition of their
house, a matter that is likely to create "confusion, disturbance, inconvenience and expenses" mentioned
in the said exceptional case.
authorities and cannot simply turn their back on these representations as their convenience requires. No
less decisive against the petitioners' argument for suspension is the decision itself of RTC Branch 19 that
the respondents attached to their Comment. This decision shows that Civil Case No. 694- M -2000,
instead of being a case for quieting of title, is in fact a mere boundary dispute.
Second. In Amagan, the MCTC decision involved the demolition of the petitioners' house a result that
this Court found to be "permanent, unjust and probably irreparable"; in the present case, only a portion
of the petitioners' house is apparently aected as the petitioners occupy the lot adjoining the disputed
property. Significantly, the height, width and breadth of the portion of the house that would be aected
by the execution of the RTC Branch 20 decision does not appear anywhere in the records, thus,
unavoidably inviting suspicion that the potential damage to the petitioners is not substantial. More
important than the fact of omission is its implication; the omission constitutes a missing link in the chain
of equitable reasons for suspension that the petitioners wish to establish. Thus, the equitable
consideration that drove us to rule as we did in Amagan does not obtain in the present case.
In the absence of a concrete showing of compelling equitable reasons at least comparable and under
circumstances analogous to Amagan, we cannot override the established rule that a pending civil action
for ownership shall not ipso facto suspend an ejectment proceeding. Additionally, to allow a suspension
on the basis of the reasons the petitioners presented in this case would create the dangerous
For August 18, 2017 precedent of allowing an ejectment suit to be suspended by an action filed in another
court by parties who are not involved or aected by the ejectment suit.
WHEREFORE, premises considered, we hereby DISMISS the petition for lack of merit. Costs against the
petitioners.

Necessarily, the armance of the MCTC Decision would cause the respondent to go through the whole SO ORDERED.
gamut of enforcing it by physically removing the petitioners from the premises they claim to have been
occupying since 1937. (Respondent is claiming ownership only of the land, not of the house) Needlessly, Quisumbing, Carpio-Morales, Tinga and Velasco, Jr., JJ., concur.
the litigants as well as the courts will be wasting much time and eort by proceeding at a stage wherein
the outcome is at best temporary, but the result of enforcement is permanent, unjust and probably
irreparable.

However, we do not find these same circumstances present in this case for the reasons we shall discuss
in detail below.

First. In Amagan, the party refusing to vacate the disputed premises (or the deforciant in the action for
unlawful detainer) was the same party seeking to quiet his title. In the present case, the petitioners are
not parties to the civil action (for quieting of title) whose result they seek to await; the plainti in the
quieting of title case is Leticia, the petitioner Julita's sister. No proof whatsoever was oered to show that
petitioner Julita is asserting her own title to the property; there is only the allegation that Leticia was
appointed as the representative of Julita and the other heirs of Isidro in their various recourses at law to
vindicate their
!103 of 105!

landowners' rights. 18 The respondents in fact actively disputed petitioner Julita's identification with the
quieting of title case in their Comment since Leticia claimed to be the sole owner of TCT No. T-188-EP
in her action to quiet title. The respondents also pointed to the document entitled "Kasulatan ng
Pagmamana ng Lupa sa Labas ng Hukuman na May Pagtalikod sa Bahagi" executed on May 27, 1995,
showing that Julita had relinquished her share over TCT No. T-188-EP in favor of her sister Leticia. A
desperation argument the petitioners advanced in their Memorandum is that the Kasulatan was only
executed "pursuant to the agrarian reform policy proscribing the parceling of the awarded landholding
into smaller units to preserve its viability". 19 In other words, the petitioners are disavowing, for purposes
of this case, the representation they made in completing their submission before the agrarian reform
authorities. We cannot of course recognize this line of argument as justification for the suspension of the
ejectment proceedings as the petitioners are bound by their representations before the agrarian reform
SECOND DIVISION
[G.R. No. 142882. May 2, 2006.]
SPS. RICARDO AND LYDIA LLOBRERA, SPS. BENJAMIN AND ESTHER LLOBRERA, SPS. MIKE
AND RESIDA MALA, SPS. OTOR AND DOLINANG BAGONTE, SPS. EDUARDO AND DAMIANA ICO,
SPS. ANTONIO AND MERLY SOLOMON, SPS. ANSELMO AND VICKY SOLOMON, SPS. ALEX AND
CARMELITA CALLEJO, SPS. DEMETRIO AND JOSEFINA FERRER, SPS. BENJAMIN AND ANITA
MISLANG, SPS. DOMINGO AND FELICIDAD SANCHEZ, SPS. FERNANDO AND CARMELITA
QUEBRAL, SPS. BERNARDO AND PRISCILLA MOLINA, PRISCILLA BAGA AND BELEN SEMBRANO,
petitioners, vs. JOSEFINA V. FERNANDEZ, respondent.
DECISION
GARCIA, J p:
Under consideration is this petition for review on certiorari under Rule 45 of the Rules of Court to nullify
and set aside the following issuances of the Court of Appeals (CA) in CA-G.R. SP No. 48918, to wit:
1. Decision dated June 30, 1999, 1 arming the Decision dated August 7, 1998 of the Regional
Trial Court (RTC) of Dagupan City, Branch 41, in Civil Case No. 98-02353-D which armed an earlier
decision of the Municipal Trial Court in Cities (MTCC), Dagupan City, Branch 2, in Civil Case No. 10848,
entitled "Josefina F. De Venecia Fernandez vs. Sps. Mariano and Lourdes Melecio, et al.," an action for
ejectment.
2. Resolution dated March 27, 2000, 2 denying petitioners' motion for reconsideration.
Subject of the controversy is a 1,849 square-meter parcel of land, covered by Transfer
Certificate of Title No. 9042. Respondent Josefina V. Fernandez, as one of the registered co-owners of
the land, served a written demand letter upon petitioners Spouses Llobrera, et al., to vacate the premises
within fifteen (15) days from
!104 of 105!
notice. Receipt of the demand letter notwithstanding, petitioners refused to vacate, necessitating the filing
by the respondent of a formal complaint against them before the Barangay Captain of Barangay 11,
Dagupan City. Upon failure of the parties to reach any settlement, the Barangay Captain issued the
necessary certification to file action.
Respondent then filed a verified Complaint for ejectment and damages against the petitioners before the
MTCC of Dagupan City, which complaint was raed to Branch 2 thereof.
By way of defense, petitioners alleged in their Answer that they had been occupying the property in
question beginning the year 1945 onwards, when their predecessors-in-interest, with the permission of
Gualberto de Venecia, one of the other co-owners of said land, developed and occupied the same on
condition that they will pay their monthly rental of P20.00 each. From then on, they have continuously
paid their monthly rentals to Gualberto de Venecia or Rosita de Venecia or their representatives, such
payments being duly acknowledged by receipts. Beginning sometime June 1996, however, the
representative of Gualberto de Venecia refused to accept their rentals, prompting them to consign the
same to Banco San Juan, which bank deposit they continued to maintain and update with their monthly
rental payments.
In a decision dated February 18, 1998, the MTCC rendered judgment for the respondent as plainti, thus:
WHEREFORE, premises considered, judgment is hereby rendered in favor of the plainti and against
the defendants as follows:
1. Ordering each of the defendants to vacate the portion of the land in question they respectively
occupy and to restore the possession thereof to the plainti and her co-owners;
2. Ordering each of the defendants to pay to the plainti the amount of P300.00 per month from
January 17, 1997 until they vacate the land in question as the reasonable compensation for the use and
occupation of the premises;
3. Ordering the defendants to pay proportionately the amount of P10,000.00 as attorney's fee and
P2,000.00 as litigation expenses, and to pay the cost of suit.
SO ORDERED.
On petitioners' appeal to the RTC of Dagupan City, Branch 41 thereof, in its decision of August 7, 1998,
armed the foregoing judgment.
For August 18, 2017
Therefrom, petitioners went to the CA whereat their recourse was docketed as CA-G.R. SP. No. 48918.
As stated at the threshold hereof, the CA, in its Decision of June 30, 1999, armed that of the RTC. With
the CA's denial of their motion for reconsideration, in its Resolution of March 27, 2000, petitioners are
now before this Court with the following assignment of errors:
THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN:
A . HOLDING THAT THE OCCUPATION AND POSSESSION OF THE PROPERTY IN QUESTION IS
BY MERE TOLERANCE OF THE RESPONDENT.
B . H O L D I N G T H AT T H E FA I L U R E O F T H E PETITIONERS (defendants) TO VACATE THE
PREMISES AFTER DEMANDS WERE MADE UPON THEM IS A VALID GROUND FOR THEIR
EJECTMENT.
C. HOLDING THAT THE CONSIGNATION MADE BY PETITIONERS IN CONTEMPLATION OF
ARTICLE 1256 OF THE NEW CIVIL CODE IS NOT LEGALLY TENABLE.
D. AFFIRMING THE DECISION OF THE REGIONAL TRIAL COURT DATED AUGUST 7, 1998
WHICH, LIKEWISE AFFIRMED THE DECISION OF THE MTCC DECISION DATED FEBRUARY 18,
1998 INSOFAR AS THE ORDER FOR THE PETITIONERS (DEFENDANTS) TO PAY RENTAL AND
ATTORNEY'S FEES AND LITIGATION EXPENSES.
At the heart of the controversy is the issue of whether petitioners' possession of the subject property is
founded on contract or not. This factual issue was resolved by the three (3) courts below in favor of
respondent. As tersely put by the CA in its assailed decision of June 30, 1999:
Petitioners failed to present any written memorandum of the alleged lease arrangements between them
and Gualberto De Venecia. The receipts claimed to have been issued by the owner were not presented
on the excuse that the March 19, 1996 fire burned the same. Simply put, there is a dearth of evidence to
substantiate the averred lessor-lessee relationship. . . . .
Consistent with this Court's long-standing policy, when the three courts below have consistently and
unanimously ruled on a factual issue, such ruling is deemed final and conclusive upon this Court,
especially in the absence of any cogent reason to depart therefrom.
From the absence of proof of any contractual basis for petitioners' possession of the subject premises,
the
!105 of 105!
only legal implication is that their possession thereof is by mere tolerance. In Roxas vs. Court of Appeals,
4 we ruled:

A person who occupies the land of another at the latter's tolerance or permission, without any contract
between them, is necessarily bound by an implied promise that he will vacate upon demand, failing which,
a summary action for ejectment is the proper remedy against him.

The judgment favoring the ejectment of petitioners being consistent with law and jurisprudence can only
be armed. The alleged consignation of the P20.00 monthly rental to a bank account in respondent's
name cannot save the day for the petitioners simply because of the absence of any contractual basis for
their claim to rightful possession of the subject property. Consignation based on Article 1256 of the Civil
Code indispensably requires a creditor-debtor relationship between the parties, in the absence of which,
the legal eects thereof cannot be availed of.

Article 1256 pertinently provides:

Art. 1256. If the creditor to whom tender of payment has been made refuses without just cause to accept
it, the debtor shall be released from responsibility by the consignation of the thing or sum due.

Unless there is an unjust refusal by a creditor to accept payment from a debtor, Article 1256 cannot apply.
In the present case, the possession of the property by the petitioners being by mere tolerance as they
failed to establish through competent evidence the existence of any contractual relations between them
and the respondent, the latter has no obligation to receive any payment from them. Since respondent is
not a creditor to petitioners as far as the alleged P20.00 monthly rental payment is concerned, respondent
cannot be compelled to receive such payment even through consignation under Article 1256. The bank
deposit made by the petitioners intended as consignation has no legal eect insofar as the respondent
is concerned.

Finally, as regards the damages awarded by the MTCC in favor of the respondent, as armed by both
the RTC and the CA, petitioners failed to present any convincing argument for the Court to modify the
same. The facts of the case duly warrant payment by the petitioners to respondent of actual and
compensatory damages for depriving the latter of the beneficial use and possession of the property. Also,
the unjustified refusal to surrender possession of the property by the petitioners who were fully aware
that they cannot present any competent evidence before the court to prove their claim to rightful
possession as against the true owners is a valid legal basis to award attorney's fees as damages, as well
as litigation expenses and cost of suit.

Rule 70 of the Rules of Court relevantly reads:

Sec. 17. Judgment. If after trial the court finds that the allegations of the complaint are true, it shall
render judgment in favor of the plainti for the restitution of the premises, the sum justly due as arrears
of rent or as reasonable compensation for the use and occupation of the premises, attorney's fees and
costs. If it finds that said allegations are not true, it shall render judgment for the defendant to recover his
costs. If a counterclaim is established, the court shall render judgment for the sum found in arrears from
either party and award costs as justice requires. (Emphasis supplied).

There is no doubt whatsoever that it is within the MTCC's competence and jurisdiction to award attorney's
fees and costs in an ejectment case. After thoroughly considering petitioners' arguments in this respect,
the Court cannot find any strong and compelling reason to disturb the unanimous ruling of the three (3)
courts below on the matter of damages.

WHEREFORE, the petition is hereby DENIED for lack of merit, with costs against petitioners.

SO ORDERED.

Sandoval-Gutierrez, Corona and Azcuna, JJ., concur. Puno, J., is on leave.