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THIS IS THE 2007 EN BANC DECISION (Lahi sad tung 2009)

MANOTOK REALTY, INC. and G.R. No. 123346


MANOTOK ESTATE CORPORATION,
Petitioners,
- versus - SANDOVAL-GUTIERREZ,
CARPIO,
AUSTRIA-MARTINEZ,
CORONA,
CLT REALTY DEVELOPMENT CARPIO-MORALES,
CORPORATION, AZCUNA,
Respondent. TINGA,
CHICO-NAZARIO,
December 14, 2007
x-------------------------------------------------------------------------------- x
ARANETA INSTITUTE OF AGRI- G.R. No. 134385
CULTURE, INC.,
Petitioner,
- versus HEIRS OF JOSE B. DIMSON, REPRESENTED BY
HIS COMPULSORY HEIRS: HIS SURVIVING
SPOUSE, ROQUETA R. DIMSON AND THEIR
CHILDREN, NORMA AND CELSA TIRADO, ALSON
AND VIRGINIA DIMSON, LINDA AND CARLOS
LAGMAN, LERMA AND RENE POLICAR, AND
ESPERANZA R. DIMSON; REGISTER OF DEES OF
MALABON,
Respondents.

FACTS:
A. G.R. No. 123346, Manotok Realty, Inc. and Manotok Estate Corporation, vs. CLT Realty Development Corporation
On 10 August 1992, CLT Realty Development Corporation (CLT) sought to recover from Manotok Realty, Inc. and Manotok Estate
Corporation (Manotoks) the possession of Lot 26 of the Maysilo Estate in an action filed before the RegionalTrial Court.

CLTs claim was anchored on Transfer Certificate of Title (TCT) No. T-177013 issued in its name by the Caloocan City Register of Deeds,
which title in turn was derived from Estelita Hipolito (Hipolito) by virtue of a Deed of Sale with Real Estate Mortgage dated 10 December 1988. Hipolitos
title emanated from Jose Dimsons (Dimson) TCT No. R-15169, a title issued pursuant to an order of the Court of First Instance (CFI) of Caloocan City,
Branch 33. Dimsons title appears to have been sourced from OCT No. 994.

Manotoks challenged the validity of the title relied on by CLT, claiming that Dimsons title, the proximate source of CLTs title, was irregularly
issued and, hence, the same and subsequent titles flowing therefrom are likewise void. The Manotoks asserted their ownership over Lot 26 and claimed
that they derived it from several awardees and/or vendees of the National Housing Authority. [9] The Manotok title likewise traced as its primary source
OCT No. 994 .

TRIAL COURT: Ruled in favor of CLT

It was established that the entire Maysilo Estate was registered under Act No. 496 by virtue of which OCT No. 994 was issued by
the Register of Deeds of Rizal; [12] that Lot 26 was transferred to CLT by Hipolito whose title was derived from the Dimson title and
that on the basis of the technical descriptions of the property appearing in the Manotok titles, the latters property indeed
encroached on the property described in CLTs title.

B. G.R. No. 134385, Araneta Institute of Agriculture, Inc. v. Heirs of Jose B. Dimson, et. al.
Dimson filed with the then CFI of Rizal, Branch 33, Caloocan City a complaint for recovery of possession and damages against Araneta Institute of
Agriculture, Inc. (Araneta). Dimson alleged that he was the absolute owner of part of the Maysilo Estate in Malabon covered by TCT No. R-15169 of the
Registry of Deeds of Caloocan City. He prayed that Araneta be ordered to vacate the same and remove all improvements thereon and to return full
possession thereof to him.

Araneta for its part admitted occupancy of the disputed land by constructing some buildings thereon and subdividing portions thereof in the exercise of
its right as absolute owner. He alleged that Dimsons title to the subject land was void and hence he had no cause of action.

TRIAL COURT: Ruled in favor of Dimson


the absence of the original survey dates of OCT No. 994 on Manotoks chain of titles, the trial court added, should mean that OCT No. 994 was not the
mother title not only because the original survey dates were different but also because the original survey date must always be earlier than the issue
date of the original title. OCT No. 994 was issued on May 3, 1917 which was much ahead of the survey date indicated in the succeeding titles, which is
December 22, 1917.
CA: Affirmed trial court
It noted that Dimsons TCT No. R-15169 was derived from OCT No. 994 registered on April 19, 1917. It was also pointed out that Aranetas TCT No.
13574 and 21343 were both derived from OCT No. 994 registered on May 3, 1917 which was previously declared null and void by the Supreme
Court in Metropolitan Waterworks and Sewerage System v. Court of Appeals.
SC THIRD DIVISION 2005 DECISION: Denied the petitions and affirmed CAs ruling.
ISSUES:
1.
2.

Which certificates of title of the conteding parties are valid


Can this Court still overturn at this point its Decision in Metropolitan Water Works and Sewerage Systems (MWSS) v. Court of Appeals (G.R. No.
103558, November 17, 1992) and Heirs of Luis J. Gonzaga v. Court of Appeals (G.R. No. 96259, September 3, 1996) sustaining the validity of
OCT No. 994 registered on April 19, 1917 and nullify the same OCT No. 994 registered later, or on May 3, 1917?

3.

How will the Reports of the Department of Justice and the Senate Fact-Finding Committee, not presented in evidence before the trial courts
concluding that the valid title is OCT No. 994 registered on May 3, 1917, affect the disposition of these cases?

HELD:

First issue:

Both the Solicitor General and CLT agree that there is only one OCT No. 994. But which is the true date of OCT No. 994, April 17, 1917 or May 3, 1917?

ANSWER: May 3, 1917


As evident on the face of OCT No. 994, the decree of registration was issued on 19 April 1917, and actually received for transcription by the Register of
Deeds on 3 May 1917.

The method of giving a paper title as found in Secs 41 and 42 of Act 496:
SEC. 41. Immediately upon the entry of the decree of registration the clerk shall send a certified copy thereof, under the seal of the
court, to the register of deeds for the province, or provinces, or city in which the land lies, and 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 the original
certificate of title, and shall be signed by him and sealed with the seal of the court.

SEC. 42. The certificate first registered in pursuance of the decree of registration in regard to any parcel of land shall be entitled in the
registration book 'Original certificate of title, entered pursuant to decree of the Court of Land Registration, dated at' (stating time and
place of entry of decree and the number of case). This certificate shall take effect upon the date of the transcription of the decree.

With the plain language of the law as mooring, this Court in two vintage and sound rulings made it plain that the original certificate of title is issued on
the date the decree of registration is transcribed. In the first ruling, it was held that there is a marked distinction between the entry of the decree and the
entry of the certificate of title; the entry of the decree is made by the chief clerk of the land registration and the entry of the certificate of title is made
by the register of deeds.[37] Such difference is highlighted by Sec. 31 of Act No. 496 as it provides that the certificate of title is issued in pursuance of the
decree of registration. In the second, it was stressed that what stands as the certificate of the title is the transcript of the decree of registration made by
the registrar of deeds in the registry.

Otherwise stated, what is actually issued by the register of deeds is the certificate of title itself, not the decree of registration, as he is precisely
the recipient from the land registration office of the decree for transcription to the certificate as well as the transcriber no less. Since what is now
acknowledged as the authentic OCT No. 994 indicates that it was received for transcription by the Register of Deeds of Rizal on 3 May 1917, it is that
date that is the date of registration since that was when he was able to transcribe the decree in the registration book, such entry made in the book being
the original certificate of title.[39] Moreover, it is only after the transcription of the decree by the register of deeds that the certificate of title is to take
effect.

(Please check full text for quoted opinions from textbook writers and other authorized persons.)

Second Issue:
In one (1) out of the four (4) times that reference was made to the mother title of Dimson in MWSS, it was OCT No. 994 issued on April 19,
1917 which is the language preferred by the dissent since it hews to the date of issuance of the decree of registration in the authentic OCT No. 994.
However, the same decision inconsistently refers to it also as OCT No. 994 registered on April 19, 1917, dated April 19, 1917, and registered under OCT
No. 994 dated April 19, 1917. Notably, the context ofMWSS in making the final citation, registered under OCT No. 994 dated April 19, 1917, was to point
out that as a result the subsequent registration of the same land on May 3, 1917 is null and void; hence, no other conclusion can be reached than that
the Court deemed Dimsons mother title as having been registered on a date earlier than 3 May 1917.
Since the dissent and even CLT now acknowledge that there is only one OCT No. 994 which was registered by the Registry of Deeds of Rizal
on 3 May 1917, the earlier factual finding in MWSS is indefensible. MWSS recognized an OCT No. 994 registered on 19 April 1917, a title that never
existed and, even assuming that it did exist, is now acknowledged as spurious.
It was the title originally registered on 19 April 1917 which was made to prevail in Gonzaga, following MWSS. Since there is no OCT No. 994 originally
registered on 19 April 1917, as now acknowledged, it follows that Gonzaga, like MWSS, is no longer reliable as well.

It would be especially incoherent for the Court to reiterate MWSS and Gonzaga when they effectuated the OCT No. 994 registered on 19 April
1917 and acknowledge at the same time that the same OCT never existed, the genuine OCT No. 994 being that which was registered on 3 May 1917.
We need not go as far as to revive the MWSS or Gonzaga decisions, but certainly we can decline to infuse further validity to their erroneous basic
premise that there was an OCT No. 994 registered on 19 April 1917. The dissent proposes that we perpetuate the erroneous premise even as the error is
plainly acknowledged, a stance that will not serve the Court well should it prevail.
Moreover, the two cases should not bind the parties in the petitions now before us. Undisputedly, the two cases involved different parcels of
land. The present petitioners could not be bound by the decisions in the two cases, as they were not parties thereto and and their properties were not
involved therein. As we very recently reaffirmed, it is basic that no man shall be affected by any proceeding to which he is a stranger, and strangers to a
case are not bound by judgment rendered by the court.

The determinative test to resolve whether the prior decision of this Court should be affirmed or set aside is whether or not the titles
invoked by the respondents are valid. If these titles are sourced from the so-called OCT No. 994 dated 17 April 1917, then such titles
are void or otherwise should not be recognized by this Court. Since the true basic factual predicate concerning OCT No. 994 which is
that there is only one such OCT differs from that expressed in the MWSSand Gonzaga decisions, said rulings have become
virtually functus officio except on the basis of the law of the case doctrine, and can no longer be relied upon as precedents.

It is evident from all three titlesCLTs, Hipolitos and Dimsonsthat the properties they purport to cover were originally registered on the 19th
day April, in the year nineteen hundred and seventeen in the Registration Book of the Office of the Register of Deeds of Rizal. Note, as earlier
established, there is no such OCT No. 994 originally registered on 19 April 1917.
The conclusion is really simple. On their faces, none of these three titles can be accorded recognition simply because the original title
commonly referred to therein never existed. To conclude otherwise would constitute deliberate disregard of the truth. These titles could be affirmed
only if it can be proven that OCT No. 994 registered on 19 April 1917 had actually existed. CLT and the Dimsons were given the opportunity
to submit such proof before this Court, but they did not. In fact, CLT has specifically manifested that the OCT No. 994 they concede as true is also the
one which the Office of Solicitor General submitted as true, and that is OCT No. 994 issued on 3 May 1917.
Given this essential clarification, there is no sense in affirming the 2005 Decision which sustained the complaints for
annulment of title and/or recovery of possession filed by CLT and the Dimson when their causes of action are both founded on an
inexistent mother title. How can such actions prosper at all even to the extent of dispossessing the present possessors with title?

From these premises, the Court is able to make the following binding conclusions. First, there is only one OCT No. 994. As it appears on the
record, that mother title was received for transcription by the Register of Deeds on 3 May 1917, and that should be the date which should be reckoned
as the date of registration of the title. It may also be acknowledged, as appears on the title, that OCT No. 994 resulted from the issuance of the decree of
registration on 17 April 1917, although such date cannot be considered as the date of the title or the date when the title took effect.

Second. Any title that traces its source to OCT No. 994 dated 17 April 1917 is void, for such mother title is inexistent. The fact that the Dimson and CLT
titles made specific reference to an OCT No. 994 dated 17 April 1917 casts doubt on the validity of such titles since they refer to an inexistent OCT. This
error alone is, in fact, sufficient to invalidate the Dimson and CLT claims over the subject property if singular reliance is placed by them on the dates
appearing on their respective titles.
Third. The decisions of this Court in MWSS v. Court of Appeals and Gonzaga v. Court of Appeals cannot apply to the cases at bar, especially in
regard to their recognition of an OCT No. 994 dated 19 April 1917, a title which we now acknowledge as inexistent. Neither could the conclusions
in MWSS or Gonzaga with respect to an OCT No. 994 dated 19 April 1917 bind any other case operating under the factual setting the same as or similar
to that at bar.

Third Issue:

(Ambot unsa ni na report guys. Wa man gi chikka sa SC. Or basin wa lang ko kita. Please check lang nya)
Since this Court is not a trier of fact, we are not prepared to adopt the findings made by the DOJ and the Senate, or even consider whether
these are admissible as evidence, though such questions may be considered by the Court of Appeals upon the initiative of the parties. The Court, in the
2005 Decision, refused to take into account the reports on the regrettable premise that they could somehow override the judicial decisions earlier
arrived at.[90] The reports cannot conclusively supersede or overturn judicial decisions, but if admissible they may be taken into account as evidence on
the same level as the other pieces of evidence submitted by the parties. The fact that they were rendered by the DOJ and the Senate should not, in
itself, persuade the courts to accept them without inquiry. The facts and arguments presented in the reports must still undergo judicial scrutiny and
analysis, and certainly the courts will have the discretion to accept or reject them.
The definitive conclusions reached by the Court thus far in these cases are spelled out in Part VI of this Resolution. Said conclusions serve to guide the
Court of Appeals in hearing these cases on remand.
The Court hereby constitutes a Special Division of the Court of Appeals to hear these cases on remand.
WHEREFORE, the instant cases are hereby REMANDED to the Special Division of the Court of Appeals for further proceedings in accordance with Parts VI,
VII and VIII of this Resolution.
SO ORDERED.