JOSE ABELGAS, JR.

and LETECIA JUSAYAN DE ABELGAS

vs.

SERVILLANO COMIA, RURAL BANK OF SOCORRO INC. And RURAL BANK OF PINAMALAYAN,
INC.

FACTS: On 4 April 1971, Comia obtained a free patent over Lot No. 919-B situated in Pinamalayan, Oriental
Mindoro with an area of 6,790 square meters. Pursuant to this free patent, Lot No. 919-B was originally
registered on 26 April 1976 as Original Certificate of Title (OCT) No. P-8553.

Subsequently, on 1 May 1971, by virtue of a notarized Deed of Relinquishment, Renunciation of Rights and
Quitclaim, Comia voluntarily conveyed a 3,000-square-meter mportion of the lot to the spouses Abelgas. It
was stated in the said Deed that the subject portion was the sole property of the spouses; and that it had
only been included in the title of Comia for it adjoined his land.

The OCT of Comia was cancelled and a Transfer Certificate of Title was issued with Comia and Spouses
Abelgas as co-owners. Therafter, the spuoses subdivided their lots and used the lands to secure loan from
banks.

The spouses defaulted in payment of the loan and the mortgage was foreclosed with RBPI as the highest
bidder. The other lots were also mortgaged to RBSI and subsequently foreclosed too.

Comia claims he is the sole owner of the mortgaged lots to RBSI and that the Deed of Relinquishment,
Renunciation of Rights and Quitclaim were all fictitious and non-existent. He pursued his action before the
Regional Trial Court (RTC) by filing a Complaint for cancellation and recovery of, and/or quieting of title to
real property and damages against the Abelgas spouses, RBPI, RBSI, and PNB.

Respondents assaild the encumberance as they were within the prohibited period of five years from the
grant of the patent.

The RTC dismissed the Complaint of Comia. It found that the Deed as signed by him voluntarily relinquished
the subject parcel of land in favor of its rightful owner and possessors – the spouses Abelgas. The trial
court also upheld the validity of the mortgages, since encumbrances made in favor of banks are exempted
according to the amendatory laws of the Public Land Act. Moreover, based on Decolongon v. CA, the
approval of the Secretary of Environment and Natural Resources is only directory.

Comia appealed to the CA, which modified the RTC’s Decision. While the appellate court sustained the due
execution of the Deed of Relinquishment, Renunciation of Rights and Quitclaim, it construed the document
as an alienation prohibited by CA 141. The CA pronounced that in an attempt to circumvent the law, it was
made to appear that the 3,000 square meters adjoining the land of Comia was owned by the spouses.
However, based on testimonial evidence, Abelgas purchased the said portion contrary to law.

Likewise, the CA nullified the mortgages, as the exemption of the banks had been removed by
Commonwealth Act 456amending Section 118 of Commonwealth Act 141, which took effect on 8 June
1939.Nevertheless, the banks may recover the value of the loans with interest.

ISSUE: The central issue in this Petition is whether the CA gravely erred in declaring the Deed of
Relinquishment, Renunciation of Rights and Quitclaim and the mortgages in favor of mortgagee banks, as
null and void for being contrary to the provisions of CA 141 and its amendatory laws?
HELD: No alienation, transfer, or conveyance of any homestead after five years and before twenty-five
years after issuance of title shall be valid without the approval of the Secretary of Agriculture and
Commerce, which approval shall not be denied except on constitutional and legal grounds.

Thus, to ascertain the correctness of the CA’s Decision, there is a need to verify whether in executing the
Deed of Relinquishment, Renunciation of Rights and Quitclaim, Comia alienated the 3,000-sqm portion
after the grant of the free patent. Although this is a finding of fact generally beyond this Court’s jurisdiction,
this Court will consider the issue, considering the conflicting factual and legal conclusions of the lower
courts.

In real property law, alienation is defined as the transfer of the property and possession of lands, tenements,
or other things from one person to another.

The Deed of Relinquishment, Renunciation of Rights and Quitclaim, as referred in the title, recognizes the
ownership of the spouses. Comia explicitly declared in the said Deed that the subject portion belonging to
the spouses Abelgas had been included in his title for it adjoins his land.

In support of the fact that the alienation transpired prior to the grant of a free patent, it is remarkable that
Comia never contested that the spouses had been in actual possession of the subject portion even before
his patent application. The private ownership of land – as when there is a prima facie proof of ownership
like a duly registered possessory information or a clear showing of open, continuous, exclusive, and
notorious possession – is not affected by the issuance of a free patent over the same land.

Seeing that there is no alienation to begin with, this Court finds that the prohibition is not applicable. Thus,
the Deed of Relinquishment, Renunciation of Rights and Quitclaim is not null and void for being contrary to
the Public Land Act.

As for the encumbrances, Comia also unsuccessfully assailed the mortgages by virtue of an alleged
violation of the Public Land Act.

For the prohibition in Section 118 of CA 141 to apply, the subject property must be acquired by virtue of
either a free patent or a homestead patent. In this case, the 3,000-sqm portion subdivided into twelve (12)
lots as evidenced by TCT Nos. T-4634 to 46375 has not been shown to be under a free patent. As it
appears, what was submitted to the mortgagee banks were TCTs not derived from a free patent.