G.R. No.

L-8936 October 2, 1915

CONSUELO LEGARDA, with her husband MAURO PRIETO, plaintiffs-appellants,

vs.
N.M. SALEEBY, defendant-appellee.

Singson, Ledesma and Lim for appellants.

D.R. Williams for appellee.

JOHNSON, J.:

From the record the following facts appear:

First. That the plaintiffs and the defendant occupy, as owners, adjoining lots in the district of Ermita in the city of Manila.

Second. That there exists and has existed a number of years a stone wall between the said lots. Said wall is located on the lot of the
plaintiffs.

Third. That the plaintiffs, on the 2d day of March, 1906, presented a petition in the Court of Land Registration for the registration of their lot.
After a consideration of said petition the court, on the 25th day of October, 1906, decreed that the title of the plaintiffs should be registered
and issued to them the original certificate provided for under the torrens system. Said registration and certificate included the wall.

Fourth. Later the predecessor of the defendant presented a petition in the Court of Land Registration for the registration of the lot now
occupied by him. On the 25th day of March, 1912, the court decreed the registration of said title and issued the original certificate provided
for under the torrens system. The description of the lot given in the petition of the defendant also included said wall.

Fifth. Several months later (the 13th day of December, 1912) the plaintiffs discovered that the wall which had been included in the certificate
granted to them had also been included in the certificate granted to the defendant .They immediately presented a petition in the Court of
Land Registration for an adjustment and correction of the error committed by including said wall in the registered title of each of said parties.
The lower court however, without notice to the defendant, denied said petition upon the theory that, during the pendency of the petition for
the registration of the defendant's land, they failed to make any objection to the registration of said lot, including the wall, in the name of the
defendant.

Sixth. That the land occupied by t he wall is registered in the name of each of the owners of the adjoining lots. The wall is not a joint wall.

Under these facts, who is the owner of the wall and the land occupied by it?

The decision of the lower court is based upon the theory that the action for the registration of the lot of the defendant was a judicial
proceeding and that the judgment or decree was binding upon all parties who did not appear and oppose it. In other words, by reason of the
fact that the plaintiffs had not opposed the registration of that part of the lot on which the wall was situate they had lost it, even though it
had been theretofore registered in their name. Granting that theory to be correct one, and granting even that the wall and the land occupied
by it, in fact, belonged to the defendant and his predecessors, then the same theory should be applied to the defendant himself. Applying that
theory to him, he had already lost whatever right he had therein, by permitting the plaintiffs to have the same registered in their name, more
than six years before. Having thus lost hid right, may he be permitted to regain it by simply including it in a petition for registration? The
plaintiffs having secured the registration of their lot, including the wall, were they obliged to constantly be on the alert and to watch all the
proceedings in the land court to see that some one else was not having all, or a portion of the same, registered? If that question is to be
answered in the affirmative, then the whole scheme and purpose of the torrens system of land registration must fail. The real purpose of that
system is to quiet title to land; to put a stop forever to any question of the legality of the title, except claims which were noted at the time of
registration, in the certificate, or which may arise subsequent thereto. That being the purpose of the law, it would seem that once a title is
registered the owner may rest secure, without the necessity of waiting in the portals of the court, or sitting in the "mirador de su casa," to
avoid the possibility of losing his land. Of course, it can not be denied that the proceeding for the registration of land under the torrens
system is judicial (Escueta vs. .Director of Lands, 16 Phil. Rep., 482). It is clothed with all the forms of an action and the result is final and
binding upon all the world. It is an action in rem. (Escueta vs. Director of Lands (supra); Grey Alba vs. De la Cruz, 17 Phil. rep., 49
Roxas vs. Enriquez, 29 Phil. Rep., 31; Tyler vs. Judges, 175 Mass., 51 American Land Co.vs. Zeiss, 219 U.S., 47.)

While the proceeding is judicial, it involves more in its consequences than does an ordinary action. All the world are parties, including the
government. After the registration is complete and final and there exists no fraud, there are no innocent third parties who may claim an
interest. The rights of all the world are foreclosed by the decree of registration. The government itself assumes the burden of giving notice to
all parties. To permit persons who are parties in the registration proceeding (and they are all the world) to again litigate the same questions,
and to again cast doubt upon the validity of the registered title, would destroy the very purpose and intent of the law. The registration, under
the torrens system, does not give the owner any better title than he had. If he does not already have a perfect title, he can not have it
registered. Fee simple titles only may be registered. The certificate of registration accumulates in open document a precise and correct
statement of the exact status of the fee held by its owner. The certificate, in the absence of fraud, is the evidence of title and shows exactly
the real interest of its owner. The title once registered, with very few exceptions, should not thereafter be impugned, altered, changed,
modified, enlarged, or diminished, except in some direct proceeding permitted by law. Otherwise all security in registered titles would be lost.
A registered title can not be altered, modified, enlarged, or diminished in a collateralproceeding and not even by a direct proceeding, after the
lapse of the period prescribed by law.

For the difficulty involved in the present case the Act (No. 496) providing for the registration of titles under the torrens system affords us no
remedy. There is no provision in said Act giving the parties relief under conditions like the present. There is nothing in the Act which indicates
who should be the owner of land which has been registered in the name of two different persons.

The rule, we think, is well settled that the decree ordering the registration of a particular parcel of land is a bar to future litigation over the
same between the same parties .In view of the fact that all the world are parties, it must follow that future litigation over the title is forever
barred; there can be no persons who are not parties to the action. This, we think, is the rule, except as to rights which are noted in the
certificate or which arise subsequently, and with certain other exceptions which need not be dismissed at present. A title once registered can
not be defeated, even by an adverse, open, and notorious possession. Registered title under the torrens system can not be defeated by
prescription (section 46, Act No. 496). The title, once registered, is notice to the world. All persons must take notice. No one can plead
ignorance of the registration.

The question, who is the owner of land registered in the name of two different persons, has been presented to the courts in other
jurisdictions. In some jurisdictions, where the "torrens" system has been adopted, the difficulty has been settled by express statutory
provision. In others it has been settled by the courts. Hogg, in his excellent discussion of the "Australian Torrens System," at page 823, says:
"The general rule is that in the case of two certificates of title, purporting to include the same land, the earlier in date prevails, whether the
land comprised in the latter certificate be wholly, or only in part, comprised in the earlier certificate. (Oelkers vs. Merry, 2 Q.S.C.R., 193;
Miller vs. Davy, 7 N.Z.R., 155; Lloyd vs. Myfield, 7 A.L.T. (V.) 48; Stevens vs. Williams, 12 V.L. R., 152; Register of Titles, vs. Esperance Land
Co., 1 W.A.R., 118.)" Hogg adds however that, "if it can be very clearly ascertained by the ordinary rules of construction relating to written
documents, that the inclusion of the land in the certificate of title of prior date is a mistake, the mistake may be rectified by holding the latter
of the two certificates of title to be conclusive." (See Hogg on the "Australian torrens System," supra, and cases cited. See also the excellent
work of Niblack in his "Analysis of the Torrens System," page 99.) Niblack, in discussing the general question, said: "Where two certificates
purport to include the same land the earlier in date prevails. ... In successive registrations, where more than one certificate is issued in
respect of a particular estate or interest in land, the person claiming under the prior certificates is entitled to the estate or interest; and that
person is deemed to hold under the prior certificate who is the holder of, or whose claim is derived directly or indirectly from the person who
was the holder of the earliest certificate issued in respect thereof. While the acts in this country do not expressly cover the case of the issue
of two certificates for the same land, they provide that a registered owner shall hold the title, and the effect of this undoubtedly is that where
two certificates purport to include the same registered land, the holder of the earlier one continues to hold the title" (p. 237).

Section 38 of Act No. 496, provides that; "It (the decree of registration) shall be conclusive upon and against all persons, including the Insular
Government and all the branches thereof, whether mentioned by name in the application, notice, or citation, or included in the general
description "To all whom it may concern." Such decree shall not be opened by reason of the absence, infancy, or other disability of any person
affected thereby, nor by any proceeding in any court for reversing judgments or decrees; subject, however, to the right of any person
deprived of land or of any estate or interest therein by decree of registration obtained by fraud to file in the Court of Land Registration a
petition for review within one year after entry of the decree (of registration), provided no innocent purchaser for value has acquired an
interest.

It will be noted, from said section, that the "decree of registration" shall not be opened, for any reason, in any court,except for fraud, and not
even for fraud, after the lapse of one year. If then the decree of registration can not be opened for any reason, except for fraud, in a direct
proceeding for that purpose, may such decree be opened or set aside in a collateral proceeding by including a portion of the land in a
subsequent certificate or decree of registration? We do not believe the law contemplated that a person could be deprived of his registered title
in that way.

We have in this jurisdiction a general statutory provision which governs the right of the ownership of land when the same is registered in the
ordinary registry in the name of two persons. Article 1473 of the Civil Code provides, among other things, that when one piece of real
property had been sold to two different persons it shall belong to the person acquiring it, who first inscribes it in the registry. This rule, of
course, presupposes that each of the vendees or purchasers has acquired title to the land. The real ownership in such a case depends upon
priority of registration. While we do not now decide that the general provisions of the Civil Code are applicable to the Land Registration Act,
even though we see no objection thereto, yet we think, in the absence of other express provisions, they should have a persuasive influence in
adopting a rule for governing the effect of a double registration under said Act. Adopting the rule which we believe to be more in consonance
with the purposes and the real intent of the torrens system, we are of the opinion and so decree that in case land has been registered under
the Land Registration Act in the name of two different persons, the earlier in date shall prevail.

In reaching the above conclusion, we have not overlooked the forceful argument of the appellee. He says, among other things; "When Prieto
et al. were served with notice of the application of Teus (the predecessor of the defendant) they became defendants in a proceeding wherein
he, Teus, was seeking to foreclose their right, and that of orders, to the parcel of land described in his application. Through their failure to
appear and contest his right thereto, and the subsequent entry of a default judgment against them, they became irrevocably bound by the
decree adjudicating such land to Teus. They had their day in court and can not set up their own omission as ground for impugning the validity
of a judgment duly entered by a court of competent jurisdiction. To decide otherwise would be to hold that lands with torrens titles are above
the law and beyond the jurisdiction of the courts".

As was said above, the primary and fundamental purpose of the torrens system is to quiet title. If the holder of a certificate cannot rest
secure in this registered title then the purpose of the law is defeated. If those dealing with registered land cannot rely upon the certificate,
then nothing has been gained by the registration and the expense incurred thereby has been in vain. If the holder may lose a strip of his
registered land by the method adopted in the present case, he may lose it all. Suppose within the six years which elapsed after the plaintiff
had secured their title, they had mortgaged or sold their right, what would be the position or right of the mortgagee or vendee? That mistakes
are bound to occur cannot be denied, and sometimes the damage done thereby is irreparable. It is the duty of the courts to adjust the rights
of the parties under such circumstances so as to minimize such damages, taking into consideration al of the conditions and the diligence of
the respective parties to avoid them. In the present case, the appellee was the first negligent (granting that he was the real owner, and if he
was not the real owner he can not complain) in not opposing the registration in the name of the appellants. He was a party-defendant in an
action for the registration of the lot in question, in the name of the appellants, in 1906. "Through his failure to appear and to oppose such
registration, and the subsequent entry of a default judgment against him, he became irrevocably bound by the decree adjudicating such land
to the appellants. He had his day in court and should not be permitted to set up his own omissions as the ground for impugning the validity of
a judgment duly entered by a court of competent jurisdiction." Granting that he was the owner of the land upon which the wall is located, his
failure to oppose the registration of the same in the name of the appellants, in the absence of fraud, forever closes his mouth against
impugning the validity of that judgment. There is no more reason why the doctrine invoked by the appellee should be applied to the
appellants than to him.

We have decided, in case of double registration under the Land Registration Act, that the owner of the earliest certificate is the owner of the
land. That is the rule between original parties. May this rule be applied to successive vendees of the owners of such certificates? Suppose that
one or the other of the parties, before the error is discovered, transfers his original certificate to an "innocent purchaser." The general rule is
that the vendee of land has no greater right, title, or interest than his vendor; that he acquires the right which his vendor had, only. Under
that rule the vendee of the earlier certificate would be the owner as against the vendee of the owner of the later certificate.

We find statutory provisions which, upon first reading, seem to cast some doubt upon the rule that the vendee acquires the interest of the
vendor only. Sections 38, 55, and 112 of Act No. 496 indicate that the vendee may acquire rights and be protected against defenses which
the vendor would not. Said sections speak of available rights in favor of third parties which are cut off by virtue of the sale of the land to an
"innocent purchaser." That is to say, persons who had had a right or interest in land wrongfully included in an original certificate would be
unable to enforce such rights against an "innocent purchaser," by virtue of the provisions of said sections. In the present case Teus had his
land, including the wall, registered in his name. He subsequently sold the same to the appellee. Is the appellee an "innocent purchaser," as
that phrase is used in said sections? May those who have been deprived of their land by reason of a mistake in the original certificate in favor
of Teus be deprived of their right to the same, by virtue of the sale by him to the appellee? Suppose the appellants had sold their lot,
including the wall, to an "innocent purchaser," would such purchaser be included in the phrase "innocent purchaser," as the same is used in
said sections? Under these examples there would be two innocent purchasers of the same land, is said sections are to be applied .Which of
the two innocent purchasers, if they are both to be regarded as innocent purchasers, should be protected under the provisions of said
sections? These questions indicate the difficulty with which we are met in giving meaning and effect to the phrase "innocent purchaser," in
said sections.

May the purchaser of land which has been included in a "second original certificate" ever be regarded as an "innocent purchaser," as against
the rights or interest of the owner of the first original certificate, his heirs, assigns, or vendee? The first original certificate is recorded in the
public registry. It is never issued until it is recorded. The record notice to all the world. All persons are charged with the knowledge of what it
contains. All persons dealing with the land so recorded, or any portion of it, must be charged with notice of whatever it contains. The
purchaser is charged with notice of every fact shown by the record and is presumed to know every fact which the record discloses .This rule is
so well established that it is scarcely necessary to cite authorities in its support (Northwestern National Bank vs. Freeman, 171 U.S., 620,
629; Delvin on Real Estate, sections 710, 710 [a]).

When a conveyance has been properly recorded such record is constructive notice of its contents and all interests, legal and equitable,
included therein. (Grandin vs. Anderson, 15 Ohio State, 286, 289; Orvis vs. Newell, 17 Conn., 97; Buchanan vs. Intentional Bank, 78 Ill.,
500; Youngs vs. Wilson, 27 N.Y., 351; McCabe vs. Grey, 20 Cal., 509; Montefiore vs. Browne, 7 House of Lords Cases, 341.)
Under the rule of notice, it is presumed that the purchaser has examined every instrument of record affecting the title. Such presumption is
irrebutable. He is charged with notice of every fact shown by the record and is presumed to know every fact which an examination of the
record would have disclosed. This presumption cannot be overcome by proof of innocence or good faith. Otherwise the very purpose and
object of the law requiring a record would be destroyed. Such presumption cannot be defeated by proof of want of knowledge of what the
record contains any more than one may be permitted to show that he was ignorant of the provisions of the law. The rule that all persons must
take notice of the facts which the public record contains is a rule of law. The rule must be absolute. Any variation would lead to endless
confusion and useless litigation.

While there is no statutory provision in force here requiring that original deeds of conveyance of real property be recorded, yet there is a rule
requiring mortgages to be recorded. (Arts. 1875 and 606 of the Civil Code.) The record of a mortgage is indispensable to its validity. (Art
.1875.) In the face of that statute would the courts allow a mortgage to be valid which had not been recorded, upon the plea of ignorance of
the statutory provision, when third parties were interested? May a purchaser of land, subsequent to the recorded mortgage, plead ignorance
of its existence, and by reason of such ignorance have the land released from such lien? Could a purchaser of land, after the recorded
mortgage, be relieved from the mortgage lien by the plea that he was a bona fide purchaser? May there be a bona fide purchaser of said
land, bona fide in the sense that he had no knowledge of the existence of the mortgage? We believe the rule that all persons must take notice
of what the public record contains in just as obligatory upon all persons as the rule that all men must know the law; that no one can plead
ignorance of the law. The fact that all men know the law is contrary to the presumption. The conduct of men, at times, shows clearly that
they do not know the law. The rule, however, is mandatory and obligatory, notwithstanding. It would be just as logical to allow the defense of
ignorance of the existence and contents of a public record.

In view, therefore, of the foregoing rules of law, may the purchaser of land from the owner of the second original certificate be an "innocent
purchaser," when a part or all of such land had theretofore been registered in the name of another, not the vendor? We are of the opinion
that said sections 38, 55, and 112 should not be applied to such purchasers. We do not believe that the phrase "innocent purchaser should be
applied to such a purchaser. He cannot be regarded as an "innocent purchaser" because of the facts contained in the record of the first
original certificate. The rule should not be applied to the purchaser of a parcel of land the vendor of which is not the owner of the original
certificate, or his successors. He, in nonsense, can be an "innocent purchaser" of the portion of the land included in another earlier original
certificate. The rule of notice of what the record contains precludes the idea of innocence. By reason of the prior registry there cannot be an
innocent purchaser of land included in a prior original certificate and in a name other than that of the vendor, or his successors. In order to
minimize the difficulties we think this is the safe rule to establish. We believe the phrase "innocent purchaser," used in said sections, should
be limited only to cases where unregistered land has been wrongfully included in a certificate under the torrens system. When land is once
brought under the torrens system, the record of the original certificate and all subsequent transfers thereof is notice to all the world. That
being the rule, could Teus even regarded as the holder in good fifth of that part of the land included in his certificate of the appellants? We
think not. Suppose, for example, that Teus had never had his lot registered under the torrens system. Suppose he had sold his lot to the
appellee and had included in his deed of transfer the very strip of land now in question. Could his vendee be regarded as an "innocent
purchaser" of said strip? Would his vendee be an "innocent purchaser" of said strip? Certainly not. The record of the original certificate of the
appellants precludes the possibility. Has the appellee gained any right by reason of the registration of the strip of land in the name of his
vendor? Applying the rule of notice resulting from the record of the title of the appellants, the question must be answered in the negative. We
are of the opinion that these rules are more in harmony with the purpose of Act No. 496 than the rule contended for by the appellee. We
believe that the purchaser from the owner of the later certificate, and his successors, should be required to resort to his vendor for damages,
in case of a mistake like the present, rather than to molest the holder of the first certificate who has been guilty of no negligence. The holder
of the first original certificate and his successors should be permitted to rest secure in their title, against one who had acquired rights in
conflict therewith and who had full and complete knowledge of their rights. The purchaser of land included in the second original certificate,
by reason of the facts contained in the public record and the knowledge with which he is charged and by reason of his negligence, should
suffer the loss, if any, resulting from such purchase, rather than he who has obtained the first certificate and who was innocent of any act of
negligence.

The foregoing decision does not solve, nor pretend to solve, all the difficulties resulting from double registration under the torrens system and
the subsequent transfer of the land. Neither do we now attempt to decide the effect of the former registration in the ordinary registry upon
the registration under the torrens system. We are inclined to the view, without deciding it, that the record under the torrens system,
supersede all other registries. If that view is correct then it will be sufficient, in dealing with land registered and recorded alone. Once land is
registered and recorded under the torrens system, that record alone can be examined for the purpose of ascertaining the real status of the
title to the land.

It would be seen to a just and equitable rule, when two persons have acquired equal rights in the same thing, to hold that the one who
acquired it first and who has complied with all the requirements of the law should be protected.

In view of our conclusions, above stated, the judgment of the lower court should be and is hereby revoked. The record is hereby returned to
the court now having and exercising the jurisdiction heretofore exercised by the land court, with direction to make such orders and decrees in
the premises as may correct the error heretofore made in including the land in the second original certificate issued in favor of the
predecessor of the appellee, as well as in all other duplicate certificates issued.

Without any findings as to costs, it is so ordered.

G.R. No. L-16257 January 31, 1963

CAPITOL SUBDIVISION, INC., plaintiff-appellant,

vs.
PROVINCE OF NEGROS OCCIDENTAL, defendant-appellee.

San Juan, Africa & Benedicto for plaintiff-appellant.

Eduardo P. Arboleda and Jesus S. Rodriguez for defendant-appellee.

CONCEPCION, J.:

Plaintiff, Capitol Subdivision, Inc., seeks to recover from defendant, the Province of Negros Occidental, the possession of Lot 378 of the
cadastral survey of Bacolod, Negros Occidental, and a reasonable compensation for the use and occupation of said lot by the defendant from
November 8, 1935, in addition to attorney's fees and costs. On June 28, 1951, the Court of First Instance of Negros Occidental rendered
judgment for the plaintiff. On appeal taken by the defendant, this judgment was, however, set aside by the Supreme Court (see G.R. No. L-
6204, decided on July 31, 1956), which, likewise, ordered the case remanded to the lower court "for further trial", after which another
decision was rendered by said court of first instance dismissing plaintiff's complaint and ordering plaintiff to execute a deed conveying Lot 378
to the defendant. The case is, once again, before us, this time on appeal by the plaintiff, the subject matter of litigation being worth more
than P200,000, exclusive of interest and costs.

The main facts are not in dispute. Said Lot 378 is part of Hacienda Mandalagan, consisting of Lots 378, 405, 407, 410, 1205, 1452 and 1641
of the aforementioned cadastral survey, with an aggregate area of over 502 hectares, originally registered in the name of Agustin Amenabar
and Pilar Amenabar. Lot 378 has an area of 22,783 sq. meters, more or less, and was covered by Original Certificate of Title No. 1776
(Exhibit 4), issued on August 25, 1916, in the name of the Amenabars. On November 30, 1920, the latter sold the aforementioned hacienda
to Jose Benares (also referred to in some documents as Jose Benares Montelibano) for the sum of P300,000, payable installments, as set
forth in the deed of sale, Exhibit 21. On February 8, 1924, said Original Certificate of Title No. 1776 was cancelled and Jose Benares obtained,
in lieu thereof, Transfer Certificate of Title No. 6295 in his name. Meanwhile, or on March 12, 1921, the Hacienda, including Lot 378, had been
mortgaged by Jose Benares to the Bacolod-Murcia Milling Co. for the sum of P27,991.74 (Exhibit Y-2). On December 6, 1926, Jose Benares
again mortgaged the Hacienda, including said Lot 378, on the Philippine National Bank, subject to the first mortgage held by the Bacolod-
Murcia Milling Co. (Exhibit Y-1). These transactions were duly recorded in the office of the Register of Deeds of Negros Occidental and
annotated on the corresponding certificate of title, including said Transfer Certificate of Title No. 6295, covering Lot 378.

The mortgage in favor of the Bank was subsequently foreclosed, in pursuance of a decision of the Court of First Instance of Negros Occidental
dated September 29, 1931 (Exhibit U-1), and the Bank acquired the Hacienda, including Lot 378, as purchaser at the foreclosure sale.
Accordingly, said Transfer Certificate of Title No. 6295 was cancelled and, in its stead, transfer Certificate of Title No. 17166 0151 — which,
owing to its subsequent loss, had to be reconstituted as Transfer Certificate of Title No. RT-1371 — in the name of the Bank, was issued on
March 14, 1934 (Exhibit P). Soon, later, or on November 8, 1935, the Bank agreed to sell the Hacienda to Carlos P. Benares, son of Jose
Banares, for the sum of P400,000, payable in annual installments, subject to the condition that, until full payment thereof, title would remain
in the Bank (Exhibit R). Thereafter, Carlos P. Benares transferred his rights, under this contract with the Bank, to plaintiff herein, which
completed the payment of the installments due to the Bank in 1949. Hence, on September 29, 1949, the Bank executed the corresponding
deed of absolute sale to the plaintiff (Exhibit Q) and Transfer Certificate of Title No. 1798, covering 378 was issued, in lieu of Transfer
Certificate of Title No. 17166 (or reconstituted Transfer Certificate of Title RT-1371), in plaintiff's name (Exhibit O).

Wherefore, the parties respectfully pray that the foregoing stipulation of facts be admitted and approved by this Honorable Court, without
prejudice to the parties adducing other evidence to prove their case not covered by this stipulation of facts. 1äwphï1.ñët

At this juncture, it should be noted that, despite the acquisition of the Hacienda in 1934 by the Bank, the latter did not take possession of the
property for Jose Benares claimed to be entitled to retain it under an alleged right of lease. For this reason, the deed of promise to sell,
executed by the Bank in favor of Carlos P. Benares, contained acaveat emptor stipulation. When, upon the execution of the deed of absolute
sale (Exhibit Q) by the Bank, on September 29, 1949, plaintiff took steps to take possession the Hacienda, it was discovered that Lot 378 was
the land occupied by the Provincial Hospital of Negros Occidental. Immediately, thereafter, or on October 4, 1949, plaintiff made
representations with the proper officials to clarify the status of said occupation and, not being satisfied with the explanations given by said
officials, it brought the present action on June 10, 1950.

In its answer dated June 24, 1950, defendant maintained that it had acquired Lot 378 in the year; 1924-1925, through expropriation
proceedings; that immediately after the commencement of said proceedings in 1924, it took possession of said lot and began the construction
thereon of the provincial hospital, which was completed in 1926; that since then it had occupied said lot publicly, adversely, notoriously and
continuously as owner thereof; that, "for some reason or other and for cause beyond comprehension of the defendant title thereto was never
transferred in the name of said defendant"; that said lot had been placed in defendant's name for assessment purposes under Tax Declaration
No. 16269 (dated December 31, 1937); and that plaintiff had acted in bad faith in purchasing said lot from the Bank in 1935, for plaintiff
knew then that the provincial hospital was where it is up to the present, and did not declare said lot in its name for assessment purposes until
1950, aside from the fact that Alfredo Montelibano, the controlling stockholder, president and general manager of plaintiff corporation, was
the first City Mayor of Bacolod which contributed to the support, operation and maintenance of said hospital. In an amended answer, dated
November 8, 1950, defendant alleged, also, that the aforementioned expropriation case was "amicably settled as between the parties herein,
in the sense that the ... Province of Negros Occidental would pay ... and did in fact pay to Jose Benares the assessed value of Lot 378 ... and
whatever consideration pertaining to said lot in excess of its assessed value which was paid by the Province would be donated and was in fact
donated by said ... Jose Benares in favor of the Province purposely for hospital site".

The main question for determination in this case is whether or not defendant herein had acquired Lot 378 in the aforementioned expropriation
proceedings. This decision appealed from in effect decided this question in the affirmative and declared that plaintiff merely holds it in trust
for the defendant, in view of which it ordered the former to convey said lot to the latter. This conclusion is predicated, substantially, upon the
following premises, namely that case No. 3041 of the Court of First Instance of Negros Occidental for the expropriation of the hospital site of
said province, was actually commenced on January 26, 1924; that, among the lands sought to be expropriated in said case was Lot 377 of
the aforementioned cadastral survey, belonging to one Anacleta Agsam, who sold it, on July 10, 1926, to the defendant (Exhibit BB), in
whose favor the corresponding transfer certificate of title (Exhibit BB-2) was issued on July 12, 1926; that, according the testimony of Jose
Benares, the expropriation of Lot 378 was settled amicably upon payment to him of the sum of P12,000; and that defendant's failure to
secure the corresponding transfer certificate of title to Lot 378 was due to "the mistaken notion or belief that said lot forms part of Lot No.
405-B" in the plan (Exhibit X.).

The testimony of Jose Benares does not deserve, however, full faith and credence, because:

1. Jose Benares appears to be strongly biased and prejudiced against the plaintiff and its president, for the former believes that the
latter had "manipulated" to exclude him from plaintiff corporation, and there have been four (4) litigations between Jose Benares
and plaintiff, all of which have been finally decided against the former;

2. The testimony of Jose Benares is extremely contradictory. Thus: (a) he testified to having been paid P12,000 by the Government,
although, at the rate of P1,000 a hectare at which, he would have us believe, he agreed to sell Lot 378; he should have received
less than P3,000 for its 22,783 sq. meters; (b) he claimed to have received said sum of P12,000.00 "in the year 1924 or 1925",
about "2 or 3 days" after the Government had taken possession of the land, and to have sent the money next day to Pilar
Amenabar, but the latter acknowledged to have received the said sum of P12,000 on November 7, 1928;
 3. Said testimony was contradicted by that of defendant's witness Jose Marco, former deputy clerk of court of Negros Occidental,
for: (a) Jose Benares asserted that there was a written compromise agreement between him and the Government, whereas Marco
averred that agreement was merely oral; and (b) Marco stated that Benares had agreed to accept, as compensation for Lot 378, the
assessed value thereof, which was P430, and to donate to the Government the difference between this sum and the true value of
the property, but Benares affirmed that he was first offered P300 per hectare, which he rejected, and that he later demanded
P1,000 a hectare, which the Government agreed to pay, although, subsequently, he said that Rafael Alunan and Mariano Yulo had
prevailed upon him to accept P1,000 per hectare;

4. Jose Benares was, also, contradicted by defendant's witness Ildefonso Coscolluela, the provincial treasurer of Negros Occidental
at the time of the expropriation, who positively assured the Court that the expropriation case "was not yet terminated" and that
"negotiations were still pending" for the acquisition of Lot 378 by the Government when he retired from the service in 1934.

Upon the other hand, several circumstances strongly indicate that no compromise agreement for the acquisition of the land by the
Government had been reached and that the expropriation had not been consummated. For instance:

1. The only entries in the docket relative to the expropriation case refer to its filing and the publication in the newspaper of the
corresponding notices (Exhibit 1);.

2. The registration of the deed of sale of Lot 377 by Anacleta Agsam to the Government, followed by the cancellation of the
certificate of title in her name and the issuance, in lieu thereof, of another title in the name of the Province, when contrasted with
the absence of a similar deed of assignment and of a transfer certificate title in favor of the Province as regards Lot 378, strongly
suggest that no such assignment or agreement with respect to Lot 378 had been made or reached;.

3. The property was mortgaged to the Bacolod-Murcia Milling Co. since March 12, 1921, and this mortgage, duly registered and
annotated, inter alia, on Transfer Certificate of Title No. 1776, in the name of Jose Benares, was not cancelled until September 28,
1935. Moreover, Lot 378 could not have been expropriated without the intervention of the Milling Co. Yet, the latter was not made a
party in the expropriation proceedings;

4. On December 26, 1926, Jose Benares constituted second mortgage in favor of the Bank, which would not have accepted the
mortgage had Lot 378 not belonged then to the mortgagor. Neither could said lot have been expropriated subsequently thereto
without the Bank's knowledge and participation. What is more, in the deed executed by the Bank, on November 8, 1935 (Exhibit R),
promising to sell the Hacienda Mandalagan to Carlos Benares, it was explicitly stated that portions of Lots 405, 407 and 410,
forming part of said Hacienda and designated as Lots 405-A, 407-A; 407-B and 410-A, had been expropriated by the Provincial
Government of Negros Occidental, thus indicating, by necessary implication, that Lot 378 had not been expropriated.

The decision appealed from says:

... It is evident that there were no further proceedings in connection with the expropriation case and the chances are that the case
was dismissed. The Court had to examine carefully and minutely every single piece of evidence adduced by both parties in order to
arrive at the correct solution of the mystery. The Court believes that the failure of the government to secure the corresponding
transfer of title to Lot 378 lies in the mistaken notion or belief that said lot forms a part of Lot 405-B. This conclusion was arrived at
after examining closely the plan, Exhibit X. The plan shows that while all the subdivided lots were properly identified by lot numbers,
that particular portion at the lower corner of the plan encircled with red pencil, marked Exhibit X-1, is not labelled with the
corresponding lot number and that portion is precisely lot No. 378, now in question, where the hospital building was constructed.
This plan was prepared for the government on May 12, 1927 by public land surveyor, Mr. Formento, embracing lots covering over
22 hectares for the Capitol and hospital sites. The fact that this particular portion was not labelled with the corresponding lot
number might have misled the authorities to believe that it formed a part of lot 405-B, which adjoins it, although separated by the
creek. This lack of reasonable explanation why the government failed to secure the corresponding certificate of title to lot 378, when
there is sufficient proof that Jose Benares was paid and he executed the deed of sale in favor of the government.

Although said decision appears to have been prepared with the conscientiousness and moral courage that account for the well earned
reputation and prestige of the Philippine judiciary, we find ourselves unable to concur in the foregoing view. To begin with, there is no
evidence, and defendant has not even tried to prove, that the expropriation case had ever been dismissed insofar as Lot 378 is concerned.
Hence, the lower court merely speculated about the "chances that the (expropriation) case was dismissed." By the way, the contrary was
intimated by defendant's witness, Ildefonso Coscolluela, for he testified that the expropriation case was still pending in 1934, when he ceased
to be the provincial treasurer, and the record before us suggests that since the Province took possession of the land in 1924 or 1925 and
completed the construction of the hospital in 1926, there were no further proceedings in said case..

With respect to the plan, Exhibit X, there is, likewise, no evidence whatsoever that the authorities had been "misled ... to believe" that the
portion at the lower corner of said plan — which was enclosed, during the trial, within a circle in red pencil, and marked as Exhibit X-1 —
formed part of Lot 405-B, which had been expropriated by the Province of Negros Occidental. In fact, said portion, Exhibit X-1, is not part of
the land covered by the plan Exhibit X. A close examination of the latter shows that the boundaries of said portion are not delimited on the
plan. More important still, on the right hand side of Exhibit X, the following appears in bold letters: "Subdivision & Consolidation PLAN of Lots
Nos. 400, 401, 403,405, 406, 407 and 410 Bacolod Cadastre as surveyed for the Provincial Government of Bacolod, Negros Occidental
(Capitol site)". The absence of Lot 378 from said enumeration and the explicit statement in Exhibit X to the effect that it refers to the "Capitol
Site", negates the possibility of its being mistaken by any body, much less by government engineers, as including the hospital site, and,
hence, said Lot 378. Lastly, the very evidence for the defendant herein, specially the assessor's field sheets and declarations of real property
for tax purposes (Exhibits 9, 10, 11, 12 and 13) show that the Government had always regarded Lot 378, not Lot 405, as part of the
Provincial Hospital Site. In any event, said possibility of mistake, if any, which would be remote, cannot suffice to warrant — in the face of
documentary evidence to the contrary — the conclusion that Lot 378 has already been acquired by the Government.

How about the P12,000 received by Jose Benares from the Government and applied by him to the payment of his debt to Pilar Amenabar?
Said amount could not possibly be the price of Lot 378, for, at the rate of P1,000 a hectare allegedly agreed therefor, its price could not have
exceeded P3,000.00. In this connection, it should be noted that, aside from the expropriation proceedings for the hospital site, another
expropriation case for the Capitol site, affecting another property of Jose Benares, appears to have been instituted in the Court of First
Instance of Negros Occidental. Jose Benares may have mistaken the payment for his land included in the Capitol site, as one intended for Lot
378, which was affected by the hospital site. And this possibility may amount to a probability when we consider that he erroneously believed
that there had been only one expropriation case, instead of two cases, against him, and that Lot 378, was not included in the mortgage
constituted by him in favor of the Philippine National Bank. Evidently, he did not have, at least, an accurate recollection of the events or
transactions affecting his properties, and, hence, his testimony may not be relied upon.

Thus, the evidence on record is far from sufficient to establish the alleged acquisition by the defendant of Lot 378, which must be held,
therefore, to be the exclusive property of plaintiff herein.

The lower court entertained no doubts about the veracity of the testimony of plaintiff's president to the effect that he did not know until 1949
that the land on which the Provincial Hospital Building stands is Lot 378. Yet, it held that plaintiff was "not a purchaser in good faith for having
constructive knowledge of defendant's possession of the property at the time it was bought by the plaintiff", because Carlos P. Benares —
whose right to buy the Hacienda Mandalagan from the Bank was acquired by plaintiff — "is a part owner of the Capitol Subdivision and holds
a responsible position therein"; because the hospital was already constructed in Lot 378 since 1926 and the lot was declared in the name of
the Government" and "when plaintiff bought the lot in 1935 the purchaser should have inquired as to its location and improvement"; because
"it took the plaintiff 14 years to sleep over the supposed rights to take possession of lot No. 378"; and because "of the overwhelming fact that
lot No. 378 was erroneously or inadvertently included by the deeds of sale (Exhibits Q & R) executed by the Philippine National Bank in favor
of the plaintiff subdivision and that same lot was occupied by the defendant government for the provincial hospital for the last 34 years, as
owner thereof".

As above stated, however, and the lower court conceded, plaintiff's president did not know until 1949 that lot 378 was the very land occupied
by the provincial hospital. Moreover, there is a total absence of evidence that this fact was known to Carlos P. Benares before 1949. Neither
may such knowledge be deduced from the circumstances that he is a son of its former owner, Jose Benares, for even the latter appears not to
be well-posted on the status of his properties. Indeed, Jose Benares did not apparently know that there were two (2) expropriation
proceedings effecting said properties: that the P12,000 received by him from the Government was not meant for Lot 378; and that this lot
was one of the properties mortgaged by him to the Bank.

"Upon the other hand, the main purpose of the Torrens System is to avoid possible conflicts of title in and to real estate, and to facilitate
transactions relative thereto giving the public the right to rely upon the face of Torrens certificate of title and to dispense with the of inquiring
further, except when the party concerned has actual knowledge of facts and circumstances that should impel a reasonably cautious man to
make such further inquiry (Tiburcio vs. PHHC, L-13479, October 31, 1959; Revilla vs. Galindez, G.R. No. L-19940, March 30, 1960; Manacop,
Jr. vs. Cansino, G.R. No. L-13791, February 27, 1961). In the case at bar plaintiff had no such actual knowledge, it being an established fact
that he was not aware until 1949 that the land on which the provincial hospital stood was Lot 378. Furthermore, since the year 1921, or
before the expropriation case for the hospital site had begun, said lot was mortgaged to the Bacolod-Murcia Milling Co., and the mortgage,
duly registered, as well as annotated on the corresponding certificate of title, was not cancelled until September 28, 1935. Prior to this date,
or on December 26, 1926, Lot 378 was subjected to a second mortgage in favor of the Bank, which acquired title thereto, thru foreclosure
proceedings, in 1934. When the Bank agreed on November 8, 1935, to sell the property to Carlos P. Benares and the latter, subsequently
conveyed his rights to plaintiff herein, as well as when the bank executed the deed of absolute sale in plaintiff's favor on September 20, 1949,
the title to the property was in the name of the Bank. Considering that sugar centrals as well as banks are known to have an array of
experienced and competent lawyers, it cannot be said that plaintiff was not justified in assuming that said institutions had scrutinized the
background of Lot 378 and were satisfied that the same belonged to the mortgagor when said mortgages were constituted, and to the Bank
when said deed of sale was executed. In short, we find that plaintiff herein is a purchaser in good faith and for value..

As regards the compensation that, as such, it may collect from the defendant, we are of the opinion, and so hold, that, since the latter's right
to expropriate Lot 378 is not contested, and is seemingly conceded, the plaintiff may demand what is due by reason of the expropriation of
said lot. In short, plaintiff is entitled to recover from the defendant the fair and full equivalent to Lot 378, as of the time when possession
thereof was actually taken by the defendant, plus consequential damages — including attorney's fees — from which consequential damages
the consequential benefits, if any, should be deducted, with interests, at the legal rate, on the aggregate sum due to the plaintiff, from and
after the date of said actual taking. The case should be remanded, therefore, to the lower court for the reception of evidence on the date of
said actual taking and the amount of compensation collectible from the defendant, and the rendition, thereafter, of the corresponding decision
thereon..

WHEREFORE, the decision appealed from is hereby reversed and the records remanded to the lower court for further proceedings, as above
stated, with costs against the defendant. It is so ordered..
G.R. No. 81163 September 26, 1988

EDUARDO S. BARANDA and ALFONSO HITALIA, petitioners,

vs.
HONORABLE JUDGE TITO GUSTILO, ACTING REGISTER OF DEEDS AVITO SACLAUSO, HONORABLE COURT OF APPEALS, and
ATTY. HECTOR P. TEODOSIO, respondents.

Eduardo S. Baranda for petitioners.

Rico & Associates for private respondents.

GUTIERREZ, JR., J.:

Eduardo S. Baranda and Alfonso Hitalia were the petitioners in G.R. No. 64432 and the private respondents in G.R. No. 62042. The subject
matter of these two (2) cases and the instant case is the same — a parcel of land designated as Lot No. 4517 of the Cadastral Survey of Sta.
Barbara, Iloilo covered by Original Certificate of Title No. 6406.

The present petition arose from the same facts and events which triggered the filing of the earlier petitions. These facts and events are cited
in our resolution dated December 29, 1983 in G.R. No. 64432, as follows:

. . . This case has its origins in a petition for reconstitution of title filed with the Court of First Instance of Iloilo involving a
parcel of land known as Lot No. 4517 of the Sta. Barbara Cadastre covered by Original Certificate of Title No. 6406 in the
name of Romana Hitalia. Eventually, Original Certificate of Title No. 6406 was cancelled and Transfer Certificate of Title No.
106098 was issued in the names of Alfonso Hitalia and Eduardo S. Baranda The Court issued a writ of possession which
Gregorio Perez, Maria P. Gotera and Susana Silao refused to honor on the ground that they also have TCT No. 25772 over
the same Lot No. 4517. The Court, after considering the private respondents' opposition and finding TCT No. 25772
fraudulently acquired, ordered that the writ of possession be carried out. A motion for reconsideration having been denied,
a writ of demolition was issued on March 29, 1982. Perez and Gotera filed a petition for certiorari and prohibition with the
Court of Appeals. On August 6, 1982, the Court of Appeals denied the petition. Perez and Gotera filed the petition for
review on certiorari denominated as G.R. No. 62042 before the Supreme Court. As earlier stated the petition was denied in
a resolution dated January 7,1983. The motion for reconsideration was denied in another resolution dated March 25, 1983,
which also stated that the denial is final. This decision in G.R. No. 62042, in accordance with the entry of judgment,
became final on March 25, 1983. The petitioners in the instant case G.R. No. 64432--contend that the writs of possession
and demolition issued in the respondent court should now be implemented; that Civil Case No. 00827 before the
Intermediate Appellate Court was filed only to delay the implementation of the writ; that counsel for the respondent should
be held in contempt of court for engaging in a concerted but futile effort to delay the execution of the writs of possession
and demolition and that petitioners are entitled to damages because of prejudice caused by the filing of this petition before
the Intermediate Appellate Court. On September 26, 1983, this Court issued a Temporary Restraining Order ' to maintain
the status quo, both in the Intermediate Appellate Court and in the Regional Trial Court of Iloilo. Considering that (l)there
is merit in the instant petition for indeed the issues discussed in G.R. No. 64432 as raised in Civil Case No. 00827 before
the respondent court have already been passed upon in G.R. No. 62042; and (2) the Temporary Restraining Order issued
by the Intermediate Appellate Court was only intended not to render the petition moot and academic pending the Court's
consideration of the issues, the Court RESOLVED to DIRECT the respondent Intermediate Appellate Court not to take
cognizance of issues already resolved by this Court and accordingly DISMISS the petition in Civil Case No. 00827.
Immediate implementation of the writs of possession and demolition is likewise ordered. (pp. 107-108, Rollo — G.R. No.
64432)

On May 9, 1984, the Court issued a resolution denying with finality a motion for reconsideration of the December 29, 1983 resolution in G.R.
No. 64432. On this same date, another resolution was issued, this time in G.R. No. 62042, referring to the Regional Trial Court of Iloilo the
ex-parte motion of the private respondents (Baranda and Hitalia) for execution of the judgment in the resolutions dated January 7, 1983 and
March 9, 1983. In the meantime, the then Intermediate Appellate Court issued a resolution dated February 10, 1984, dismissing Civil Case
No. 00827 which covered the same subject matter as the Resolutions above cited pursuant to our Resolution dated December 29, 1983. The
resolution dated December 29, 1983 in G.R. No. 64432 became final on May 20, 1984.

Upon motions of the petitioners, the Regional Trial Court of Iloilo, Branch 23 presided by Judge Tito G. Gustilo issued the following order:

Submitted are the following motions filed by movants Eduardo S. Baranda and Alfonso Hitalia through counsel dated
August 28, 1984:

(a) Reiterating Motion for Execution of Judgment of Resolutions dated January 7, 1983 and March 9, 1983 Promulgated by
Honorable Supreme Court (First Division) in G.R. No. 62042;

(b) Motion for Execution of Judgment of Resolution dated December 29, 1983 Promulgated by Honorable Supreme Court
(First Division) in G.R. No. 64432;

(c) The Duties of the Register of Deeds are purely ministerial under Act 496, therefore she must register all orders,
judgment, resolutions of this Court and that of Honorable Supreme Court.

Finding the said motions meritorious and there being no opposition thereto, the same is hereby GRANTED.

WHEREFORE, Transfer Certificate of Title No. T-25772 is hereby declared null and void and Transfer Certificate of Title No.
T-106098 is hereby declared valid and subsisting title concerning the ownership of Eduardo S. Baranda and Alfonso Hitalia,
all of Sta. Barbara Cadastre.

The Acting Register of Deeds of Iloilo is further ordered to register the Subdivision Agreement of Eduardo S. Baranda and
Alfonso Hitalia as prayed for." (p. 466, Rollo--G.R. No. 64432)

The above order was set aside on October 8, 1984 upon a motion for reconsideration and manifestation filed by the Acting Registrar of Deeds
of Iloilo, Atty. Helen P. Sornito, on the ground that there was a pending case before this Court, an Action for Mandamus, Prohibition,
Injunction under G.R. No. 67661 filed by Atty. Eduardo Baranda, against the former which remained unresolved.

In view of this development, the petitioners filed in G.R. No. 62042 and G.R. No. 64432 ex-parte motions for issuance of an order directing
the Regional Trial Court and Acting Register of Deeds to execute and implement the judgments of this Court. They prayed that an order be
issued:
 1. Ordering both the Regional Trial Court of Iloilo Branch XXIII, under Hon. Judge Tito G. Gustilo and the acting Register of
Deeds Helen P. Sornito to register the Order dated September 5, 1984 of the lower court;

2. To cancel No.T-25772. Likewise to cancel No.T-106098 and once cancelled to issue new certificates of title to each of
Eduardo S. Baranda and Alfonso Hitalia;

Plus other relief and remedies equitable under the premises. (p. 473, 64432 Rollo)

Acting on these motions, we issued on September 17,1986 a Resolution in G.R. No. 62042 and G.R. No. 64432 granting the motions as
prayed for. Acting on another motion of the same nature filed by the petitioners, we issued another Resolution dated October 8, 1986
referring the same to the Court Administrator for implementation by the judge below.

In compliance with our resolutions, the Regional Trial Court of Iloilo, Branch 23 presided by Judge Tito G. Gustilo issued two (2) orders dated
November 6,1986 and January 6,1987 respectively, to wit:

ORDER

This is an Ex-parte Motion and Manifestation submitted by the movants through counsel on October 20, 1986; the
Manifestation of Atty. Helen Sornito, Register of Deeds of the City of Iloilo, and formerly acting register of deeds for the
Province of Iloilo dated October 23, 1986 and the Manifestation of Atty. Avito S. Saclauso, Acting Register of Deeds,
Province of Iloilo dated November 5, 1986.

Considering that the motion of movants Atty. Eduardo S. Baranda and Alfonso Hitalia dated August 12, 1986 seeking the
full implementation of the writ of possession was granted by the Honorable Supreme Court, Second Division per its
Resolution dated September 17,1986, the present motion is hereby GRANTED.

WHEREFORE, the Acting Register of Deeds, Province of Iloilo, is hereby ordered to register the Order of this Court dated
September 5, 1984 as prayed for.

ORDER

This is a Manifestation and Urgent Petition for the Surrender of Transfer Certificate of Title No. T-25772 submitted by the
petitioners Atty. Eduardo S. Baranda and Alfonso Hitalia on December 2, 1986, in compliance with the order of this Court
dated November 25, 1 986, a Motion for Extension of Time to File Opposition filed by Maria Provido Gotera through counsel
on December 4, 1986 which was granted by the Court pursuant to its order dated December 15, 1986. Considering that no
Opposition was filed within the thirty (30) days period granted by the Court finding the petition tenable, the same is
hereby GRANTED.

WHEREFORE, Maria Provido Gotera is hereby ordered to surrender Transfer Certificate of Title No. T-25772 to this Court
within ten (10) days from the date of this order, after which period, Transfer Certificate of Title No. T-25772 is hereby
declared annulled and the Register of Deeds of Iloilo is ordered to issue a new Certificate of Title in lieu thereof in the
name of petitioners Atty. Eduardo S. Baranda and Alfonso Hitalia, which certificate shall contain a memorandum of the
annulment of the outstanding duplicate. (pp. 286-287, Rollo 64432)

On February 9, 1987, Atty. Hector Teodosio, the counsel of Gregorio Perez, private respondent in G.R. No. 64432 and petitioner in G.R. No.
62042, filed a motion for explanation in relation to the resolution dated September 17, 1986 and manifestation asking for clarification on the
following points:

a. As to the prayer of Atty. Eduardo Baranda for the cancellation of TCT T-25772, should the same be referred to the Court
of Appeals (as mentioned in the Resolution of November 27, 1985) or is it already deemed granted by implication (by
virtue of the Resolution dated September 17, 1986)?

b. Does the Resolution dated September 17, 1986 include not only the implementation of the writ of possession but also
the cancellation of TCT T-25772 and the subdivision of Lot 4517? (p. 536, Rollo — 4432)

Acting on this motion and the other motions filed by the parties, we issued a resolution dated May 25, 1987 noting all these motions and
stating therein:

Since entry of judgment in G.R. No. 62042 was made on January 7, 1983 and in G.R. No. 64432 on May 30, 1984, and all
that remains is the implementation of our resolutions, this COURT RESOLVED to refer the matters concerning the
execution of the decisions to the Regional Trial Court of Iloilo City for appropriate action and to apply disciplinary sanctions
upon whoever attempts to trifle with the implementation of the resolutions of this Court. No further motions in these cases
will be entertained by this Court. (p. 615, Rollo-64432)

In the meantime, in compliance with the Regional Trial Court's orders dated November 6, 1986 and January 6, 1987, Acting Register of Deeds
Avito Saclauso annotated the order declaring Transfer Certificate of Title No. T-25772 as null and void, cancelled the same and issued new
certificates of titles numbers T-111560, T-111561 and T-111562 in the name of petitioners Eduardo S. Baranda and Alfonso Hitalia in lieu of
Transfer Certificate of TItle No. T-106098.

However, a notice of lis pendens "on account of or by reason of a separate case (Civil Case No. 15871) still pending in the Court of Appeals"
was carried out and annotated in the new certificates of titles issued to the petitioners. This was upheld by the trial court after setting aside
its earlier order dated February 12, 1987 ordering the cancellation oflis pendens.

This prompted the petitioners to file another motion in G.R, No. 62042 and G.R. No. 64432 to order the trial court to reinstate its order dated
February 12, 1987 directing the Acting Register of Deeds to cancel the notice of lis pendensin the new certificates of titles.

In a resolution dated August 17, 1987, we resolved to refer the said motion to the Regional Trial Court of Iloilo City, Branch 23 for
appropriate action.

Since respondent Judge Tito Gustilo of the Regional Trial Court of Iloilo, Branch 23 denied the petitioners' motion to reinstate the February
12, 1987 order in another order dated September 17, 1987, the petitioners filed this petition for certiorari, prohibition and mandamus with
preliminary injunction to compel the respondent judge to reinstate his order dated February l2, 1987 directing the Acting Register of Deeds to
cancel the notice of lis pendens annotated in the new certificates of titles issued in the name of the petitioners.
The records show that after the Acting Register of Deeds annotated a notice of is pendens on the new certificates of titles issued in the name
of the petitioners, the petitioners filed in the reconstitution case an urgent ex-parte motion to immediately cancel notice of lis pendens
annotated thereon.

In his order dated February 12, 1987, respondent Judge Gustilo granted the motion and directed the Acting Register of Deeds of Iloilo to
cancel the lis pendens found on Transfer Certificate of Title Nos. T-106098; T-111560; T-111561 and T-111562.

Respondent Acting Register of Deeds Avito Saclauso filed a motion for reconsideration of the February 12, 1987 order stating therein:

That the undersigned hereby asks for a reconsideration of the said order based on the second paragraph of Section 77 of
P.D. 1529, to wit:

"At any time after final judgment in favor of the defendant or other disposition of the action such as to
terminate finally all rights of the plaintiff in and to the land and/or buildings involved, in any case in
which a memorandum or notice of Lis Pendens has been registered as provided in the preceding
section, the notice of Lis Pendens shall be deemed cancelled upon the registration of a certificate of the
clerk of court in which the action or proceeding was pending stating the manner of disposal thereof."

That the lis pendens under Entry No. 427183 was annotated on T-106098, T-111560, T-111561 and T-111562 by virtue of
a case docketed as Civil Case No. 15871, now pending with the Intermediate Court of Appeals, entitled, "Calixta Provido,
Ricardo Provido, Sr., Maria Provido and Perfecto Provido, Plaintiffs, versus Eduardo Baranda and Alfonso Hitalia,
Respondents."

That under the above-quoted provisions of P.D. 152, the cancellation of subject Notice of Lis Pendens can only be made or
deemed cancelled upon the registration of the certificate of the Clerk of Court in which the action or proceeding was
pending, stating the manner of disposal thereof.

Considering that Civil Case No. 1587, upon which the Notice of Lis Pendens was based is still pending with the
Intermediate Court of Appeals, only the Intermediate Court of Appeals and not this Honorable Court in a mere cadastral
proceedings can order the cancellation of the Notice of Lis Pendens. (pp. 68-69, Rollo)

Adopting these arguments and on the ground that some if not all of the plaintiffs in Civil Case No. 15871 were not privies to the case affected
by the Supreme Court resolutions, respondent Judge Tito Gustilo set aside his February 12, 1987 order and granted the Acting Register of
Deeds' motion for reconsideration.

The issue hinges on whether or not the pendency of the appeal in Civil Case No. 15871 with the Court of Appeals prevents the court from
cancelling the notice of lis pendens in the certificates of titles of the petitioners which were earlier declared valid and subsisting by this Court
in G.R. No. 62042 and G.R. No. 64432. A corollary issue is on the nature of the duty of a Register of Deeds to annotate or annul a notice of lis
pendens in a torrens certificate of title.

Civil Case No. 15871 was a complaint to seek recovery of Lot No. 4517 of Sta. Barbara Cadastre Iloilo, (the same subject matter of G.R. No
62042 and G.R. No. 64432) from petitioners Baranda and Hitalia filed by Calixta Provido, Ricardo Provido, Maxima Provido and Perfecta
Provido before the Regional Trial Court of Iloilo, Branch 23. At the instance of Atty. Hector P. Teodosio, the Provides' counsel, a notice of is
pendens was annotated on petitioners' Certificate of Title No. T-106098 covering Lot No. 4517, Sta. Barbara Cadastre.

Acting on a motion to dismiss filed by the petitioners, the court issued an order dated October 24, 1984 dismissing Civil Case No. 15871.

The order was then appealed to the Court of Appeals. This appeal is the reason why respondent Judge Gustilo recalled the February 12, 1987
order directing the Acting Register of Deeds to cancel the notice of lis pendens annotated on the certificates of titles of the petitioners.

This petition is impressed with merit.

Maria Provido Gotera was one of the petitioners in G.R. No. 62042. Although Calixta Provido, Ricardo Provido, Maxima Provido and Perfecta
Provido, the plaintiffs in Civil Case No. 15871 were not impleaded as parties, it is very clear in the petition that Maria Provido was acting on
behalf of the Providos who allegedly are her co-owners in Lot No. 4517, Sta. Barbara Cadastre as shown by Transfer Certificate of Title No. T-
25772 issued in her name and the names of the plaintiffs in Civil Case No. 15871, among others. (Annex "E" G.R. No. 62042, p. 51, Rollo) In
fact, one of the issues raised by petitioners Maria Provido Gotera and Gregoria Perez in G.R. No. 62042 was as follows:

2. Whether or not, in the same reconstitution proceedings, respondent Judge Midpantao L. Adil had the authority to declare
as null and void the transfer certificate of title in the name of petitioner Maria Provido Gotera and her other co-owners. (p.
3, Rollo; Emphasis supplied)

It thus appears that the plaintiffs in Civil Case No. 15871 were privies to G.R. No. 62042 contrary to the trial court's findings that they were
not.

G.R. No. 62042 affirmed the order of the then Court of First Instance of Iloilo in the reconstitution proceedings declaring TCT No. 25772 in the
name of Providos over Lot No. 4517, Sta. Barbara Cadastre null and void for being fraudulently obtained and declaring TCT No. 106098 over
the same parcel Lot No. 4517, Sta. Barbara Cadastre in the name of petitioners Eduardo Baranda and Alfonso Hitalia valid and subsisting.

The decision in G.R. No. 62042 became final and executory on March 25,1983 long before Civil Case No. 15871 was filed.

Under these circumstances, it is crystal clear that the Providos, private respondents herein, in filing Civil Case No. 15871 were trying to delay
the full implementation of the final decisions in G.R. No. 62042 as well as G.R. No. 64432 wherein this Court ordered immediate
implementation of the writs of possession and demolition in the reconstitution proceedings involving Lot No. 4517, Sta. Barbara Cadastre.

The purpose of a notice of lis pendens is defined in the following manner:

Lis pendens has been conceived to protect the real rights of the party causing the registration thereof With the lis pendens
duly recorded, he could rest secure that he would not lose the property or any part of it. For, notice of lis pendens serves
as a warning to a prospective purchaser or incumbrancer that the particular property is in litigation; and that he should
keep his hands off the same, unless of course he intends to gamble on the results of the litigation. (Section 24, Rule 14,
RuIes of Court; Jamora v. Duran, et al., 69 Phil. 3, 11; I Martin, Rules of Court, p. 415, footnote 3, citing cases.) (Natanov.
Esteban, 18 SCRA 481, 485-486)
The private respondents are not entitled to this protection. The facts obtaining in this case necessitate the application of the rule enunciated
in the cases of Victoriano v. Rovila (55 Phil. 1000), Municipal Council of Paranaque v. Court of First Instance of Rizal (70 Phil., 363) and
Sarmiento v. Ortiz (10 SCRA 158), to the effect that:

We have once held that while ordinarily a notice of pendency which has been filed in a proper case, cannot be cancelled
while the action is pending and undetermined, the proper court has the discretionary power to cancel it under peculiar
circumstances, as for instance, where the evidence so far presented by the plaintiff does not bear out the main allegations
of his complaint, and where the continuances of the trial, for which the plaintiff is responsible, are unnecessarily delaying
the determination of the case to the prejudice of the defendant. (Victoriano v. Rovira, supra; The Municipal Council of
Paranaque v. Court of First Instance of Rizal, supra)

The facts of this case in relation to the earlier cases brought all the way to the Supreme Court illustrate how the private respondents tried to
block but unsuccessfuly the already final decisions in G.R. No. 62042 and G.R. No. 64432.

Parenthetically, respondent Judge Tito Gustilo abused his discretion in sustaining the respondent Acting Register of Deeds' stand that, the
notice of lis pendens in the certificates of titles of the petitioners over Lot No. 4571, Barbara Cadastre cannot be cancelled on the ground of
pendency of Civil Case No. 15871 with the Court of Appeals. In upholding the position of the Acting Register of Deeds based on Section 77 of
Presidential Decree No. 1529, he conveniently forgot the first paragraph thereof which provides:

Cancellation of lis pendens. — Before final judgment, a notice of lis pendens may be cancelled upon Order of the Court
after proper showing that the notice is for the purpose of molesting the adverse party, or that it is not necessary to protect
the rights of the party who caused it to be registered. It may also be cancelled by the Register of Deeds upon verified
petition of the party who caused the registration thereof.

This Court cannot understand how respondent Judge Gustilo could have been misled by the respondent Acting Register of Deeds on this
matter when in fact he was the same Judge who issued the order dismissing Civil Case No. 15871 prompting the private respondents to
appeal said order dated October 10, 1984 to the Court of Appeals. The records of the main case are still with the court below but based on
the order, it can be safely assumed that the various pleadings filed by the parties subsequent to the motion to dismiss filed by the petitioners
(the defendants therein) touched on the issue of the validity of TCT No. 25772 in the name of the Providos over Lot Number 4571, Sta.
Barbara Cadastre in the light of the final decisions in G.R. No. 62042 and G.R. No. 64432.

The next question to be determined is on the nature of the duty of the Register of Deeds to annotate and/or cancel the notice of lis
pendens in a torrens certificate of title.

Section 10, Presidential Decree No. 1529 states that "It shall be the duty of the Register of Deeds to immediately register an instrument
presented for registration dealing with real or personal property which complies with all the requisites for registration. ... . If the instrument is
not registrable, he shall forthwith deny registration thereof and inform the presentor of such denial in writing, stating the ground or reasons
therefore, and advising him of his right to appeal by consulta in accordance with Section 117 of this Decree."

Section 117 provides that "When the Register of Deeds is in doubt with regard to the proper step to be taken or memoranda to be made in
pursuance of any deed, mortgage or other instrument presented to him for registration or where any party in interest does not agree with the
action taken by the Register of Deeds with reference to any such instrument, the question shall be submitted to the Commission of Land
Registration by the Register of Deeds, or by the party in interest thru the Register of Deeds. ... ."

The elementary rule in statutory construction is that when the words and phrases of the statute are clear and unequivocal, their meaning
must be determined from the language employed and the statute must be taken to mean exactly what it says. (Aparri v. Court of Appeals,
127 SCRA 231; Insular Bank of Asia and America Employees' Union [IBAAEU] v. Inciong, 132 SCRA 663) The statute concerning the function
of the Register of Deeds to register instruments in a torrens certificate of title is clear and leaves no room for construction. According to
Webster's Third International Dictionary of the English Language — the word shall means "ought to, must, ...obligation used to express a
command or exhortation, used in laws, regulations or directives to express what is mandatory." Hence, the function of a Register of Deeds
with reference to the registration of deeds encumbrances, instruments and the like is ministerial in nature. The respondent Acting Register of
Deeds did not have any legal standing to file a motion for reconsideration of the respondent Judge's Order directing him to cancel the notice
of lis pendens annotated in the certificates of titles of the petitioners over the subject parcel of land. In case of doubt as to the proper step to
be taken in pursuance of any deed ... or other instrument presented to him, he should have asked the opinion of the Commissioner of Land
Registration now, the Administrator of the National Land Title and Deeds Registration Administration in accordance with Section 117 of
Presidential Decree No. 1529.

In the ultimate analysis, however, the responsibility for the delays in the full implementation of this Court's already final resolutions in G.R.
No. 62042 and G.R. No. 64432 which includes the cancellation of the notice of lis pendensannotated in the certificates of titles of the
petitioners over Lot No. 4517 of the Sta. Barbara Cadastre falls on the respondent Judge. He should never have allowed himself to become
part of dilatory tactics, giving as excuse the wrong impression that Civil Case No. 15871 filed by the private respondents involves another set
of parties claiming Lot No. 4517 under their own Torrens Certificate of Title.

WHEREFORE, the instant petition is GRANTED. The February 12, 1987 order of the Regional Trial Court of Iloilo, Branch 23 is REINSTATED. All
subsequent orders issued by the trial court which annulled the February 12, 1987 order are SET ASIDE. Costs against the private
respondents. SO ORDERED.
G.R. No. L-18725 March 31, 1965

JOSE MA. LEDESMA, petitioner-appellee,

vs.
FELIX VILLASEÑOR, movant-appellant.

Sicangco, Estino, Sison and Associates for petitioner-appellee.

Gabriel Benedicto for movant-appellant.

MAKALINTAL, J.:

Felix Villaseñor, in his capacity as special administrator of the estate of his deceased father, Eusebio Villaseñor, filed a petition in the Court of
First Instance of Negros Occidental (Civil Case No. 5662) to enjoin the Register of Deeds of the same province from registering a deed of sale
by which the deceased conveyed to Jose Ma. Ledesma two lots registered in his name, to wit, Lots Nos. 2532-C and 2533-B of the Cadastral
Survey of Bago, Negros Occidental. The reason given for seeking injunctive relief was that the deed of sale was fictitious and that the
signature of the vendor was forged. The court issued a writ of preliminary injunction to maintain the status quo. The vendee, Ledesma, who
had not been impleaded as a party-defendant, intervened in the case. On October 3, 1960 the court lifted the writ of preliminary injunction
and dismissed the petition.

Two days later, on October 5, Ledesma filed his own petition in the cadastral record of said lots, asking that the Register of Deeds be ordered
to register the aforementioned deed of sale. The ground alleged in the petition was that Civil Case No. 5662 had been dismissed and the
preliminary injunction issued therein had been dissolved. On the same day the court, without notice either to the Register of Deeds or to
appellant, and solely on the basis of the allegations in the petition, issued the corresponding order for registration. In compliance therewith
the Register of Deeds cancelled the two certificates of title in the name of the deceased Eusebio Villaseñor and issued new ones in Ledesma's
name. On October 8, 1960, again upon Ledema's petition, the court ordered the cancellation of the certificates thus issued and the issuance
of still new ones, also in his name.

Villaseñor moved for reconsideration of the two orders and then perfected this appeal upon their denial.

Appellant claims that the lower court erred in issuing the orders appealed from because: (1) appellee failed to give notice to appellant or to
furnish him copy of the petition; (2) appellee should have filed the same in Civil Case No. 5662 and not in the cadastral proceeding; (3) the
court had no power to order the Register of Deeds to register the deed of sale in question when the same was being contested as fictitious
nor to order the issuance of titles in the name of the supposed buyer; and (4) if, as appellee points out, the Register of Deeds had improperly
refused to register the deed of sale, the proper remedy should have been a suit for mandamus.1äwphï1.ñët

We are of the opinion that the lower court did commit the error attributed to it. To be sure, when the writ of preliminary injunction in Civil
Case No. 5662 was dissolved in the same order which dismissed appellant's petition the obstacle to the registration of the deed of sale was
removed. The effect of the dissolution was immediate and would not be stayed even if an appeal had been perfected from the order of
dismissal (Watson v. Enriquez, 1 Phil. 480; Sitia Taco v. Ventura, 1 Phil. 497). But that is only as far as the Register of Deeds was concerned,
his duty under the circumstances — if the document was on its face registrable — being administrative and ministerial. The lifting of the
injunction, however, or even the dismissal of the petition, was no authority for the court in the cadastral proceeding to issue the orders
complained of without notice to the Register of Deeds or to appellant, considering that the dismissal of Civil Case No. 3662 was not yet final.
The court knew of the pendency of that case and of the fact that the relief sought therein by appellant was precisely to prevent registration.
Irrespective of the propriety or impropriety of the remedy pursued, that is, whether or not mandamus should have been resorted to, the least
that the court a quo should have done was to afford appellant proper notice and hearing, so that he could reiterate his objections to the
registration and present evidence to substantiate them and/or call the court's attention to the fact that the question had not yet been
definitely settled in the civil action since the order dismissing it was not yet final.

It is one thing for the Register of Deeds, in the exercise of his ministerial duties under the law, to register an instrument which in his opinion
is registrable, and quite another thing for the court itself to order the registration. The former does not contemplate notice to and hearing of
interested parties such as are required in a judicial proceeding nor carry with it the solemnity and legal consequences of a court judgment.
The court a quo, in anticipating the action of the Register of Deeds, unnecessarily took the matter out of his hands and at the same time
preempted the question of registration still pending in the civil action filed by appellant.

The orders appealed from are hereby set aside, with costs against appellee.
G.R. No. L-22486 March 20, 1968

TEODORO ALMIROL, petitioner-appellant,

vs.
THE REGISTER OF DEEDS OF AGUSAN, respondent-appellee.

Tranquilino O. Calo, Jr. for petitioner-appellant.

Office of the Solicitor General for respondent-appellee.

CASTRO, J.:

On June 28, 1961 Teodoro Almirol purchased from Arcenio Abalo a parcel of land situated in the municipality of Esperanza, province of
Agusan, and covered by original certificate of title P-1237 in the name of "Arcenio Abalo, married to Nicolasa M. Abalo." Sometime in May,
1962 Almirol went to the office of the Register of Deeds of Agusan in Butuan City to register the deed of sale and to secure in his name a
transfer certificate of title. Registration was refused by the Register of Deeds upon the following grounds, inter alia, stated in his letter of May
21, 1962:

1. That Original Certificate of Title No. P-1237 is registered in the name of Arcenio Abalo, married to Nicolasa M. Abalo, and by legal
presumption, is considered conjugal property;

2. That in the sale of a conjugal property acquired after the effectivity of the New Civil Code it is necessary that both spouses sign
the document; but

3. Since, as in this case, the wife has already died when the sale was made, the surviving husband can not dispose of the whole
property without violating the existing law (LRC Consulta No. 46 dated June 10, 1958).

To effect the registration of the aforesaid deed of absolute Sale, it is necessary that the property be first liquidated and
transferred in the name of the surviving spouse and the heirs of the deceased wife by means of extrajudicial settlement or partition
and that the consent of such other heir or heirs must be procured by means of another document ratifying this sale executed by
their father.

In view of such refusal, Almirol went to the Court of First Instance of Agusan on a petition for mandamus (sp. civ. case 151), to compel
the Register of Deeds to register the deed of sale and to issue to him the corresponding transfer certificate of title, and to recover P5,000 in
moral damages and P1,000 attorney's fees and expenses of litigation. It is Almirol's assertion that it is but a ministerial duty of the
respondent to perform the acts required of him, and that he (Almirol) has no other plain, speedy and adequate remedy in the ordinary course
of law.

In his answer with counterclaim for P10,000 damages, the respondent reiterated the grounds stated in his letter of May 21, 1962,
averred that the petitioner has "other legal, plain, speedy and adequate remedy at law by appealing the decision of the respondent to the
Honorable Commissioner of Land Registration," and prayed for dismissal of the petition.

In its resolution of October 16, 1963 the lower court, declaring that "mandamus does not lie . . . because the adequate remedy is that
provided by Section 4 of Rep. Act 1151", dismissed the petition, with costs against the petitioner.

Hence the present appeal by Almirol.

The only question of law tendered for resolution is whether mandamus will lie to compel the respondent to register the deed of sale in
question.

Although the reasons relied upon by the respondent evince a sincere desire on his part to maintain inviolate the law on succession and
transmission of rights over real properties, these do not constitute legal grounds for his refusal to register the deed. Whether a document is
valid or not, is not for the register of deeds to determine; this function belongs properly to a court of competent jurisdiction.1

Whether the document is invalid, frivolous or intended to harass, is not the duty of a Register of Deeds to decide, but a court
of competent jurisdiction. (Gabriel vs. Register of Deeds of Rizal, et al., L-17956, Sept. 30, 1953).

. . . the supposed invalidity of the contracts of lease is no valid objection to their registration, because invalidity is no proof of
their non-existence or a valid excuse for denying their registration. The law on registration does not require that only valid
instruments shall be registered. How can parties affected thereby be supposed to know their invalidity before they become aware,
actually or constructively, of their existence or of their provisions? If the purpose of registration is merely to give notice, then
questions regarding the effect or invalidity of instruments are expected to be decided after, not before, registration. It must follow
as a necessary consequence that registration must first be allowed, and validity or effect litigated afterwards. (Gurbax Singh Pablo &
Co. vs. Reyes and Tantoco, 92 Phil. 182-183).

Indeed, a register of deeds is entirely precluded by section 4 of Republic Act 1151 from exercising his personal judgment and
discretion when confronted with the problem of whether to register a deed or instrument on the ground that it is invalid. For under the said
section, when he is in doubt as to the proper step to be taken with respect to any deed or other instrument presented to him for registration,
all that he is supposed to do is to submit and certify the question to the Commissioner of Land Registration who shall, after notice and
hearing, enter an order prescribing the step to be taken on the doubtful question. Section 4 of R.A. 1151 reads as follows:

Reference of doubtful matters to Commissioner of Land Registration. — When the Register of Deeds is in doubt with regard to
the proper step to be taken or memorandum to be made in pursuance of any deed, mortgage, or other instrument presented to him
for registration, or where any party in interest does not agree with the Register of Deeds with reference to any such matter, the
question shall be submitted to the Commissioner of Land Registration either upon the certification of the Register of Deeds, stating
the question upon which he is in doubt, or upon the suggestion in writing by the party in interest; and thereupon the Commissioner,
after consideration of the matter shown by the records certified to him, and in case of registered lands, after notice to the parties
and hearing, shall enter an order prescribing the step to be taken or memorandum to be made. His decision in such cases shall be
conclusive and binding upon all Registers of Deeds: Provided, further, That when a party in interest disagrees with the ruling or
resolution of the Commissioner and the issue involves a question of law, said decision may be appealed to the Supreme Court within
thirty days from and after receipt of the notice thereof.

The foregoing notwithstanding, the court a quo correctly dismissed the petition for mandamus. Section 4 abovequoted provides that
"where any party in interest does not agree with the Register of Deeds . . . the questionshall be submitted to the Commissioner of Land
Registration," who thereafter shall "enter an order prescribing the step to be taken or memorandum to be made," which shall be "conclusive
and binding upon all Registers of Deeds." This administrative remedy must be resorted to by the petitioner before he can have recourse to the
courts. ACCORDINGLY, the Resolution of the lower court of October 16, 1969, is affirmed, at petitioner's cost.
G.R. No. L-20611 May 8, 1969

AURELIO BALBIN and FRANCISCO BALBIN, petitioners,

vs.
REGISTER OF DEEDS OF ILOCOS SUR, respondent.

Vicente Llanes for petitioners.

Office of the Solicitor General for respondent.
Manuel A. Argel for respondents third parties affected.

MAKALINTAL, J.:

Appeal from the resolution of the Commissioner of Land Registration in LRC Consulta No. 366.

On November 15, 1961 petitioners presented to the register of deeds of Ilocos Sur a duplicate copy of the registered owner's certificate of
title (OCT No. 548) and an instrument entitled "Deed of Donation inter-vivos," with the request that the same be annotated on the title.
Under the terms of the instrument sought to be annotated one Cornelio Balbin, registered owner of the parcel of land described in OCT No.
548, appears to have donated inter-vivos an undivided two-thirds (²/³) portion thereof in favor of petitioners. The entire area of the land is
11.2225 hectares.

The register of deeds denied the requested annotation for being "legally defective or otherwise not sufficient in law." It appears that
previously annotated in the memorandum of encumbrances on the certificate are three separate sales of undivided portions of the land earlier
executed by Cornelio Balbin in favor of three different buyers. The pertinent entries read:

Entry No. 5658. Sales.

Sale for the sum of P400.00 executed by the registered owner, conveying an undivided portion of an area of 3,710 square meters only in
favor of Florentino Gabayan, this Original Certificate of Title No. 548 is hereby cancelled with respect to said area of 3,710 square meters and
in lieu thereof, the name of the vendee ... is hereby substituted to succeed to all rights, participation in interest of the vendor. ...

Date of Instrument: January 25, 1955, ...

Entry No. 5659. Sale of portion.

Sale for the sum of P100.00 executed by the registered owner, conveying an undivided portion of an area of 16,713 square meters in favor of
Roberto Bravo, this Original Certificate of Title No. 548 is hereby cancelled with respect to said undivided portion ... and in lieu thereof the
name of the vendee ... is hereby substituted to succeed to all rights, participation and interest of the vendor ...

Date of Instrument: June 9, 1953. ...

Entry No. 5660. Sale of portion.

Sale for the sum of P400.00 executed by the registered owner, conveying an undivided portion of an area of 15,000 square meters
in favor of Juana Gabayan, this Certificate of Title No. 548 is hereby cancelled with respect to said undivided portion ... and in lieu
thereof the name of the vendee ... is hereby substituted to succeed to all rights, participation and interest of the vendor ...

Date of Instrument: February 12, 1952. ...

The final part of the annotations referring to the abovementioned sales contains an additional memorandum stating that "three co-owner's
duplicate certificates of title No. 548 have been issued (by the register of deeds of Ilocos Sur) in the name of Florentino Gabayan, Roberto
Bravo and Juana Gabayan upon verbal request of Mr. Andres Cabeldo, Notary Public of Caoayan, I. Sur, for and in the name of the vendees,
this 5th day of January, 1956 at Vigan, I. Sur." Mainly because these three other co-owner's copies of the certificate of title No. 548 had not
been presented by petitioners, the Register of Deeds refused to make the requested annotation.

Unsatisfied, petitioners referred the matter to the Commissioner of Land Registration, who subsequently upheld the action of the Register of
Deeds in a resolution dated April 10, 1962. With respect to the principal point in controversy, the Commissioner observed:

(1) It appears that the donor is now merely a co-owner of the property described in the Original Certificate of Title No. 548, having
previously sold undivided portions thereof on three different occasions in favor of three different buyers. Consequently, aside from
the owner's duplicate issued to Cornelio Balbin, there are now three co-owner's duplicates which are presumably in the possession
of the three buyers. Accordingly, in addition to the owner's duplicate of Original Certificate of Title No. 548, the three co-owner's
duplicates must likewise be surrendered. The claim of counsel for the donees that the issuance of the three co-owner's duplicates
was unauthorized is beside the point. Unless and until a court of competent jurisdiction rules to the contrary, these titles are
presumed to have been lawfully issued.lawphi1.ñet

Without presenting those three (3) other duplicates of the title, petitioners would want to compel annotation of the deed of donation upon the
copy in their possession, citing section 55 of Act 496, which provides that "the production of the owner's duplicate certificate of title whenever
any voluntary instrument is presented for registration shall be conclusive authority from the registered owner to the register of deeds to make
a memorandum of registration in accordance with such instrument." Under this provision, according to petitioners, the presentation of the
other copies of the title is not required, first, because it speaks of "registered owner" and not one whose claim to or interest in the property is
merely annotated on the title, such as the three vendees-co-owners in this case; and secondly, because the issuance of the duplicate copies
in their favor was illegal or unauthorized.

We find no merit in petitioners' contention. Section 55, supra, obviously assumes that there is only one duplicate copy of the title in question,
namely, that of the registered owner himself, such that its production whenever a voluntary instrument is presented constitutes sufficient
authority from him for the register of deeds to make the corresponding memorandum of registration. In the case at bar, the three other
copies of the title were in existence, presumably issued under section 43 * of Act 496. As correctly observed by the Land Registration
Commissioner, petitioners' claim that the issuance of those copies was unauthorized or illegal is beside the point, its legality being presumed
until otherwise declared by a court of competent jurisdiction. There being several copies of the same title in existence, it is easy to see how
their integrity may be adversely affected if an encumbrance, or an outright conveyance, is annotated on one copy and not on the others. The
law itself refers to every copy authorized to be issued as a duplicate of the original, which means that both must contain identical entries of
the transactions, particularly voluntary ones, affecting the land covered by the title. If this were not so, if different copies were permitted to
carry differing annotations, the whole system of Torrens registration would cease to be reliable.
One other ground relied upon by the Land Registration Commissioner in upholding the action taken by the Register of Deeds of Ilocos Sur is
that since the property subject of the donation is presumed conjugal, that is, property of the marriage of the donor, Cornelio Balbin, and his
deceased wife, Nemesia Mina, "there should first be a liquidation of the partnership before the surviving spouse may make such a
conveyance." This legal conclusion may appear too general and sweeping in its implications, for without a previous settlement of the
partnership a surviving spouse may dispose of his aliquot share or interest therein — subject of course to the result of future liquidation.
Nevertheless, it is not to be denied that, if the conjugal character of the property is assumed, the deed of donation executed by the husband,
Cornelio Balbin, bears on its face an infirmity which justified the denial of its registration, namely, the fact that the two-thirds portion of said
property which he donated was more than his one-half share, not to say more than what remained of such share after he had sold portions of
the same land to three other parties.

It appears that there is a case pending in the Court of First Instance of Ilocos Sur (CC No. 2221), wherein the civil status of the donor
Cornelio Balbin and the character of the land in question are in issue, as well as the validity of the different conveyances executed by him.
The matter of registration of the deed of donation may well await the outcome of that case, and in the meantime the rights of the interested
parties could be protected by filing the proper notices of lis pendens.

IN VIEW OF THE FOREGOING, the decisions of the Register of Deeds of Ilocos Sur and that of the Commissioner of Land Registration are
affirmed. No pronouncement as to costs.
G.R. No. L-67742 October 29, 1987

MELITON GALLARDO and TERESA VILLANUEVA, petitioners,

vs.
HONORABLE INTERMEDIATE APPELLATE COURT, MARTA VILLANUEVA VDA. DE AGANA, VISITACION AGANA KIPPING, PEDRO V.
AGANA, MARCELO V. AGANA, JR., TERESITA AGANA SANTOS and JESUS V. AGANA, respondents.

PARAS, J.:

This is a petition for review on certiorari seeking to set aside or reverse the decision * of the Intermediate Appellate Court (now Court of
Appeals) promulgated on May 22, 1984 in AC-G.R. CV No. 69946 entitled Meliton Gallardo and Teresa Villanueva v. Marta Villanueva vda. de
Agana, et al. (Rollo, p. 37) affirming the decision ** of the Court of First Instance of Laguna 8th Judicial District, Branch II, Sta. Cruz, Laguna
(now Regional Trial Court, Sta. Cruz, Laguna) dated January 20, 1982, which dismissed the complaint for Quieting of Title in Civil Case No.
SC-1492 and declared the plaintiff's (petitioner's herein) Re-constituted Transfer Certificate of Title RT-6293 (No. 23350) as null and void
(Record on Appeal, pp. 215-216).

The dispositive portion of the questioned decision reads as follows:

WHEREFORE, the appealed judgment is in full accord with the evidence and the law and is hereby therefore affirmed in all
its part. Costs against plaintiff –appellants SO ORDERED.

The subject matter of this controversy involves a parcel of land situated in Cavinti, Laguna consisting of 81,300 square meters, more or less,
initially covered by an original Certificate of Title No. 2262, issued on April 2, 1924 owned and registered in the name of the late Pedro
Villanueva (former Justice of the Peace of the Municipal Court, Cavinti, Laguna), pursuant to Decree No. 150562 issued in L.R.C. Cadastral
Record No. 136, Cad. Case No. 1 (Record on Appeal; Answer, p. 28).

Petitioners were nephew and niece of the late Pedro Villanueva and first cousin of the private respondent Marta Villanueva vda. de Agana, the
latter being the daughter of Pedro Villanueva.

On August 10, 1937, petitioner claimed that the aforestated land was sold to them in a private document, an unnotarized deed of sale written
in Tagalog (Annex "B" of the complaint) that was allegedly signed by the late Pedro Villanueva conveying and transfering the property in
question in favor of the petitioners (Record on Appeal, Exhibit "B", pp. 9-10) which deed is reproduced as follows.

Ako, Pedro Villanueva, 66 taong gulang, balo at nananahanan sa municipio ng Cavinti, lalawigang Laguna at Kapuluang
Pilipinas, alang-alang sa halagang LIMANG DAANG PISO (P500.00) salaping filipino, na sa akin ibinayad ng mag-asawa ni
Meliton Gallardo at Teresa Villanueva, tagarito rin sa nasabing municipio, lalawigang at kapulwan sa hinaharap ng
kasulatan ay sinasaysay ko na aking inilillwat at pinagbili ng biling patuluyan sa nasabing mag-asawa Meliton Gallardo at
Teresa Villanueva, sampo na sa kanilay mangagmamana at hahalili, ang aking isang palagay na lupa na nabubuo sa
limang luang na tubigan, punlang kalahating kabang palay at saka dalatan o katihan na may isang kabang palay na hasik,
tumatayo sa nayon ng Kanlurang Talaongan, sakop nitong municipio ng Cavinti at napapaloob sa mga hangganang
sumusunod:

HILAGAAN, Braulio Villanueva at Modesto Ribera

SILANGAN, Braulio Villanueva.

TIMUGAN, Braulio Villanueva, Ilog Kaliraya at Jacinto Toque

KANLURAN, Jacinto Toque.

Ang pagaaring ito ay tunay kong pananarili sapagkat aking nabili sa magkakapatid na Aniano Gallardo, Zacarias Gallardo
at Perfecto Gallardo at natatala sa Registro ng Amillarmiento dito sa Cavinti sa ilalim ng Blg. 22888, at walang ano mang
ipinagkakautang ni pinanagutan kaya at magagamit na nitong aking pinagbilhan ang kanilang matuwid na maipamana at
mailiwa sa iba. Gayon ding sinasaysay ko na akoy umaakong mananagutan dito sa aking pinagbilhan, tungkol sa pagaaring
ito na ang katibay ay aking ipagsasanggalang laban sa kanino mang maghahabol.

Dapat tantoin, gayon man, na ang pagaaring ito ay registrado na sa Registro de la Propiedad nitong lalawigang Laguna,
subalit at sa isang kamalian ng pagkakasukat tungkol sa lawak at laki, ay hindi pa natutubos ang kanyang titulo, kaya at
kung maisaayos na ang nasabing titulo ay saka na ipatatala sa pangalan nitong aking pinagbilhan upang lalong malagay sa
katahimikan itong aking pinagbilhan.

At sa katunayan ay nilagdaan ko ang kasulatang ito dito sa municipio ng Cavinti, Laguna, ngayong ika sampung araw ng
Agosto taong isanglibo siyam na daan at tatlompu at pito (1937).

(LGD) PEDRO VILLANUEVA

Nagfirma sa hinaharap ni

(LGD) BALTAZAR VILLANUEVA

JUAN VILLANUEVA

Subsequently, the Original Certificate of Title was cancelled on the basis of the private document of sale (Exhibit "B") and a new certificate of
title was issued in the name of the petitioners covered by Transfer Certificate of Title No. RT- 6293 (No. 23350) on January 4, 1944,
particularly describing the land as follows:

A parcel of land (Lot No. 401 of the Cadastral Survey of Cavinti) with the improvements thereon, situated in the
municipality of Cavinti, Bounded on the N and NE., by Lot No. 403; on the SE by Lot No. 393 and the Caliraya River; and
on the SW by Lot No. 515. Area — Eighty One Thousand and Three Hundred (81,300) Square Meters, more or less.
(Record on Appeal, Annex "A," pp. 7 and 9).

During the Second World War, the records as well as the Office of the Register of Deeds of Laguna, where the original of their new transfer
certificate of title was kept, were completely burned. Accordingly, by virtue of an Affidavit of Reconstitution dated December 2, 1958 (Record
on Appeal, Annex "DD," pp. 41-42) and upon presentation of the Owner's Duplicate Certificate of Title, the title was administratively
reconstituted and the Register of Deeds of Laguna issued Transfer Certificate of Title No. RT-6293 (No. 23350) in the name of the petitioners
(Record on Appeal, Annex "B", pp. 7).

On November 17, 1976, defendant Marta Villanueva together with Pedro Villanueva, Jr., and Restituto R. Villanueva executed and filed an
Affidavit of Adverse Claim with the Office of the Register of Deeds of Laguna (Record on Appeal, Annex "C", pp. 10-13). However, on
December 6, 1976 a joint affidavit was filed by Pedro G. Villanueva, Jr. and Restituto Villanueva withdrawing their adverse claim on the said
parcel of land, with the Office of the Register of Deeds of Laguna (Record on Appeal, Annex " D, " pp. 13-14).

When petitioners learned of this Affidavit of Adverse Claim, attempt was made to settle said controversy amicably. Several demands made by
herein petitioners upon private respondents Marta Vda. de Agana to withdraw her adverse claim, failed.

On December 9, 1976, said private respondent executed a Deed of Conveyance and Release of Claim (Record on Appeal and Annex "AA", p.
35) wherein the parties agreed, among other things, to the following:

That in consideration of the said transfer and conveyance over a 1,000 square meter portion mentioned in the next
preceding paragraph, the VENDEE (Marta V. Agana) does hereby withdraw the adverse claim mentioned above; (Rollo, p.
119).

However, when private respondent Marta Villanueva vda. de Agana refused to sign an Affidavit of Quit-claim (Exhibit "9; " Record on appeal,
p. 195), petitioners instituted court suit against the private respondent and her husband, Dr. Marcelo S. Agana, Sr. by filing a complaint for
Quieting of Title and Damages with the Court of First Instance of Laguna on February 3, 1977, demanding that their title over the questioned
land be fortified by a declaration of ownership in their favor and avoiding the af/recited Deed of Conveyance and Release of Claim (Record on
Appeal, pp. 1-7). Accordingly, private respondents in their answer countered that the Deed of Sale in Tagalog and petitioners' title over the
land be declared void ab initio, among other demands (Record on Appeal, pp. 16-35).

On January 20, 1982, the Court of First Instance of Laguna rendered its decision declaring the deed of sale of August 10, 1937, as well as the
reconstituted transfer certificate of title of petitioners, void ab initio Record on Appeal, pp. 208-216).

The dispositive portion of said decision (Record on Appeal, pp. 215-216) reads as follows:

WHEREFORE, judgment is hereby rendered in favor of the defendants and against the plaintiffs, as follows:

a. declaring as null and void the private document dated August 10, 1937 written in Tagalog (Exhibit
B);

b. declaring as null and void plaintiffs' reconstituted Transfer Certificate of Title RT-6293 (No. 23350)
(Exhibit F) and ordering the Register of Deeds of Laguna to issue a new reconstituted or to reinstate
Original Certificate of Title No. 2262 issued on April 2, 1924 in the name of Pedro Villanueva within
thirty (30) days from the finality of this decision;

c. declaring the heirs of Pedro Villanueva as the owners of the property in litigation and ordering the
plaintiffs and her agents and those acting for in their behalf to vacate the land in question and
surrender the possession of the same to the heirs of the late Pedro Villanueva thru Marta V. Agana;

d. declaring all buildings; plantings and improvements introduced by the plaintiffs forfeited in favor of'
the defendants:

e. ordering plaintiffs, jointly and severally, to pay the defendants the sum of P10,000.00 as moral and
exemplary damages;

f. ordering plaintiffs, jointly and severally, to pay defendants the sum of P5,000.00 as and for attorney's
fees: and

g. ordering plaintiffs, jointly and severally, to pay defendants the sum of P5,000.00 as litigation
expenses; and costs of suit.

SO ORDERED.

Thus, petitioners filed notice of appeal on February 10, 1982, followed by an appeal made to the Intermediate Appellate Court. However, the
Intermediate Appellate Court, on May 22, 1984, affirmed in toto the decision of the trial court.

Hence, this petition.

On August 30, 1984, the Court in its Resolution without giving due course to the petition required the respondents to comment on the said
petition (Rollo, p. 50). However, the counsel for private respondents failed to file comment on the petition for review on certiorari within the
period which expired on September 17, 1984. Thus, in the Resolution of January 7, 1985 the Court, required counsel for petitioners to show
cause why disciplinary action should not be taken against him (Rollo, p. 51).

On February 23, 1985 respondents filed their comment (Rollo, p. 57). Considering respondents' comment as answer the petition was given
due course and the parties were required to submit their respective memoranda (Rollo, p. 104).

Private respondents and petitioners filed their respective memoranda on May 18, 1985 (Rollo, p. 117) and on June 7, 1985 (Rollo, p. 143)
respectively. On July 1, 1985, the Court resolved to consider the case submitted for deliberation (Rollo, p. 168).

Petitioners, however filed a Supplemental Memorandum, with leave of court on May 18, 1987 (Rollo, p. 169) which was noted by the court in
its resolution dated June 19, 1987 (Rollo, p. 188).

In its petition petitioners raised the following assignment of errors, to wit:

THE TRIAL COURT ERRED IN HOLDING THAT EXHIBIT B DOES NOT TRANSFER OWNERSHIP, THE SAME BEING NULL AND VOID.
II

THE TRIAL COURT ERRED IN HOLDING THAT DEFENDANTS-APPELLANTS ARE NOT GUILTY OF LACHES.

III

THE TRIAL COURT ERRED IN HOLDING THAT PLAINTIFF- APPELLANTS CANNOT ACQUIRE OWNERSHIP OF SUBJECT LAND BY PRESCRIPTION
UPON THE PRINCIPLE THAT NO TITLE TO REGISTERED LAND IN DEROGATION OF THAT OF THE REGISTERED OWNER SHALL BE ACQUIRED
BY PRESCRIPTION.

IV

THE TRIAL COURT ERRED IN NOT HOLDING THAT STATUTE OF LIMITATION HAS SET INTO THIS CASE; AND,

THE TRIAL COURT ERRED IN DECLARING TRANSFER CERTIFlCATE OF TITLE NO. RT-6293 AS NULL AND VOID.

The pivotal issue in this case is whether or not there was a valid reconstitution of Transfer Certificate of Title No. RT-6293 (No. 23350) issued
in the names of petitioners.

It is admitted that the land in question is formerly covered by Original Certificate of Title No. 2262, issued in the name of Pedro Villanueva
and that the cancellation of said OCT No. 2262 and the issuance of the reconstituted Transfer Certificate of Title No. RT-6293 (No. 23350) are
based either on the Affidavit for Reconstitution of Teresa Villanueva and not of Pedro Villanueva, or the unnotarized deed of sale of August 10,
1937 (Annex "B" for plaintiffs), held void by the lower court and by the Court of Appeals. As a consequence TCT No. RT-6293 (No. 23350)
was likewise held void ab initio. (Record on Appeal, p. 20).

As to the validity of the Affidavit for Reconstitution, affiant Teresa Villanueva testified on December 19, 1980, that she did not know anything
about the reconstitution of their title as it was their children who took charge of the same and that she never participated in the said
reconstitution. In fact she never appeared before the Notary Public and this testimony was corroborated by the testimony of Eleuterio
Rebenque, entry clerk in the Office of the Register of Deeds who never made any categorical affirmation that said Teresa Villanueva appeared
at said office. (Rollo, p. 43).

Consequently, the crux of the matter now centers on whether or not the unnotarized deed of sale purportedly executed on August 10, 1937
by the primitive owner Pedro Villanueva, in favor of petitioners, can be considered as a valid instrument for effecting the alienation by way of
sale of a parcel of land registerd under the Torrens System. Corollary thereto, it becomes necessary to examine other matters surrounding
the execution of the alleged document of sale (Exhibit B).

Petitioners claim that the sale although not in a public document, is nevertheless valid and binding citing this Court's rulings in the cases
of Cauto v. Cortes, 8 Phil. 459, 460; Guerrero v. Miguel, 10 Phil. 52, 53; Bucton v. Gabar 55 SCRA 499 wherein this Court ruled that even a
verbal contract of sale of real estate produces legal effects between the parties.

The contention is unmeritorious.

As the respondent court aptly stated in its decision:

True, as argued by appellants, a private conveyance of registered property is valid as between the parties. However, the
only right the vendee of registered property in a private document is to compel through court processes the vendor to
execute a deed of conveyance sufficient in law for purposes of registration. Plaintiffs-appellants' reliance on Article 1356 of
the Civil Code is unfortunate. The general rule enunciated in said Art. 1356 is that contracts are obligatory, in whatever
form they may have been entered, provided all the essential requisites for their validity are present. The next sentence
provides the exception, requiring a contract to be in some form when the law so requires for validity or enforceability. Said
law is Section 127 of Act 496 which requires, among other things, that the conveyance be executed "before the judge of a
court of record or clerk of a court of record or a notary public or a justice of the peace, who shall certify such
acknowledgment substantially in form next hereinafter stated."

Such law was violated in this case. The action of the Register of Deeds of Laguna in allowing the registration of the private
deed of sale was unauthorized and did not lend a bit of validity to the defective private document of sale.

With reference to the special law, Section 127 of the Land Registration Act, Act 496 (now Sec. 112 of P.D. No. 1529) provides:

Sec. 127. Deeds of Conveyance, ... affecting lands, whether registered under this act or unregistered shall be sufficient in
law when made substantially in accordance with the following forms, and shall be as effective to convey, encumber, ... or
bind the lands as though made in accordance with the more prolix forms heretofore in use: Provided, That every such
instrument shall be signed by the person or persons executing the same, in the presence of two witnesses, who shall sign
the instrument as witnesses to the execution thereof, and shall be acknowledged to be his or their free act and deed by the
person or persons executing the same, before the judge of a court of record or clerk of a court of record, or a notary
public, or a justice of the peace, who shall certify to such acknowledgement substantially in the form next hereinafter
stated. (Emphasis supplied).

It is therefore evident that Exhibit " E " in the case at bar is definitely not registerable under the Land Registration Act.

Likewise noteworthy is the case of Pornellosa and Angels v. Land Tenure Administration and Guzman, 110 Phil. 986, where the Court ruled:

The deed of sale (Exhibit A), allegedly executed by Vicente San Jose in favor of Pornellosa is a mere private document and
does not conclusively establish their right to the parcel of land. WhiIe it is valid and binding upon the parties with respect
to the sale of the house erected thereon, yet it is not sufficient to convey title or any right to the residential lot in litigation.
Acts and contracts which have for their object the creation, transmission, modification or extinguishment of real rights over
immovable property must appear in a public document.

Upon consideration of the facts and circumstances surrounding the execution of the assailed document, the trial court found that said private
document (Exhibit "B") was null and void and that it was signed by somebody else not Pedro Villanueva. Such findings of fact besides being
based on the records, were sustained by the Court of Appeals.
The contention that ownership over registered property may be acquired by prescription or adverse possession is absolutely without merit. No
title to registered land in derogation of that of the registered owner shall be acquired by prescription or adverse possession. Prescription is
unavailing not only against the registered owner but also against his hereditary successors (Umbay vs. Alecha, 135 SCRA 427 [1985]). The
right to recover possession of registered land is imprescriptible because possession is a mere consequence of ownership (Umbay vs.
Alecha, supra, citing Atun v. Nuñuz 97 Phil. 762; Manlapas and Tolentino v. Llorente, 48 Phil. 298, 308: J.M. Tuazon & Co., Inc. v. Aguirre,
117 Phil. 110, 113-114) where land has been registered under the Torrens System (Alarcon v. Bidin, 120 SCRA 390; Umbay v. Alecha, supra)
because the efficacy and integrity of the Torrens System must be protected (Director of Lands v. CA, 120 SCRA 370). As prescription is rightly
regarded as a statute of repose whose objective is to suppress fraudulent and stale claims from springing up at great distances of time and
suprising the parties or their representatives when the facts have become obscure from the lapse of time or the defective memory or death or
removal of witnesses ( Senoan v. Sorongon, 136 SCRA 407 [1985]).

In the matter of laches, the Court aptly stated in the case of Marcelo Sotto v. Pilar Teves, et al., 86 SCRA 155 [1978] that "in determining
whether a delay in seeking to enforce a right constitutes laches, the existence of a confidential relationship between the parties is an
important circumstance for consideration. A delay under such circumstance is not as strictly regarded as where the parties are strangers to
each other. The doctrine of laches is not strictly applied between near relatives, and the fact that the parties are connected by ties of blood or
marriage tends to excuse an otherwise unreasonable delay."

In the case of Esso Standard Eastern, Inc. v. Alfonso Lim, 123 SCRA 464, 480 [1983]), the Court ruled that laches cannot be asserted by a
mere possessor without claim of title, legal or equitable because for laches to exist, there should be a showing of delay in asserting the
complainant's right. The complainant should have knowledge or notice of the defendant's conduct and an opportunity to institute a suit. Delay
is not counted from the date the lot was sold to the buyer but from the time of entry of the defendant or from the time the complainant came
to know of the occupancy for that is the only time it could possibly have demanded that he get out of the premises or could have instituted a
suit. In the case at bar, it will be noted that what transpired was an administrative reconstitution, essentially ex-parte and without notice,
thereby lending credence to the claim that private respondent Marta Agana was unaware of such reconstitution and possession until she
discovered the same in the Office of the Register of Deeds in 1976. As such it cannot be claimed that she slept on her right as from that time
on, it is undeniable that she filed her adverse claim on the said lot.

After a careful perusal of the case, there appears to be no cogent reason to disturb the findings of fact of the Court of Appeals which affirmed
the findings of the trial court.

PREMISES CONSIDERED, the petition is DENIED and the assailed decision of the Intermediate Appellate Court is AFFIRMED. SO ORDERED.
G.R. No. L-37995 August 31, 1987

BUREAU OF FORESTRY, BUREAU OF LANDS and PHILIPPINE FISHERIES COMMISSION, petitioners,

vs.
COURT OF APPEALS and FILOMENO GALLO, respondents.

PARAS, J.:

Before Us is a petition for review on certiorari, which seeks to annul and set aside the Decision 1 (promulgated on April 11, 1973) of the
respondent court in CA-G.R. No. 38163-R, affirming the decision 2 (dated April 6, 1966) of the then Court of First Instance of Iloilo in Land
Registration Case No. N-506, G.L.R.O. Record No. N-20783 entitled "Filomeno Gallo, Applicant vs. Bureau of Forestry, Bureau of Lands, and
Philippine Fisheries Commission, oppositors. " The dispositive portion of the trial court's decision reads as follows:

WHEREFORE, the court Orders the registration of Lots Nos. 2, 3, and 4 and the bigger portion of Lot No. 1 after excluding
the portion Identified as Lot 1-A together with the improvements thereon in the name of Filomeno Gallo, of legal age,
widower, Filipino citizen, and resident of 155 Fuentes Street, Iloilo City, Philippines. Lots Nos. 1, 2 and 3 are subject to the
road right-of-way of 15 meters wide which is presently known as Sto. Rosario Rizal Montpiller provincial Road and
Buenavista-Daraga provincial Road they being properties of the Province of Iloilo and should be registered in the name of
said province. The oppositions of the Director of Lands, Director of Forestry and the Philippine Fisheries Commission are
dismissed. Lot 1-A with an area of 2.6864 hectares which is enclosed in red pencil and is found inside Lot No. 1 in the plan
Exhibit is hereby declared public land. After the decision has become final let the corresponding decree be issued.

SO ORDERED. (p. 38, Joint Record on Appeal Annex "A." p. 25, Rollo)

This appeal also seeks to annul and set aside respondent court's resolution dated December 14, 1973 denying for lack of merit, herein
petitioners' motion for reconsideration.

The basic issue which petitioners raise in this appeal is —

Whether or not the classification of lands of the public domain by the Executive Branch of the Government into agricultural,
forest or mineral can be changed or varied by the court depending upon the evidence adduced before it. (p. 9, Brief for the
Petitioners, p. 105, Rollo)

The antecedent facts of the case are as follows:

On July 11, 1961, four (4) parcels of land situated in Buenavista, Iloilo described in Plan Psu-150727, containing an approximate area of
30.5943 hectares were the subject of an application for registration by Mercedes Diago who alleged among others that she herself occupied
said parcels of land having bought them from the testate estate of the late Jose Ma. Nava who, in his lifetime, had bought the lands in turn
from Canuto Gustilo on June 21, 1934. The Director of Lands opposed said application on the ground that neither the applicant nor her
predecessors-in-interest have sufficient title over the lands applied for, which could be registered under the Torrens systems, and that they
have never been in open, continuous and exclusive possession of the said lands for at least 30 years prior to the filing of the application. The
Director of Forestry on the other hand anchored his opposition principally on the ground that certain specific portions of the lands subject
matter of the application, with an area of approximately 194,080 square meters are mangrove swamps and are within Timberland Block "B "
L.C. Project No. 38, L.C. Map No. 1971 of Buenavista, Iloilo.

On June 30, 1965, respondent Filomeno Gallo, having purchased the subject parcels of land from Mercedes Diago on April 27, 1965, moved to
be substituted in place of the latter, attaching to his motion an Amended Application for Registration of Title substantially reproducing the
allegations in the application of Mercedes Diago. Petitioner Philippine Fisheries Commission also moved on August 30, 1965 to be substituted
in place of petitioner Bureau of Forestry as oppositor over a portion of the land sought to be registered, supervision and control of said portion
having been transferred from the Bureau of Forestry to the Philippine Fisheries Commission.

On April 6, 1966, the trial court rendered its decision ordering the registration of the four (4) parcels of land in the name of respondent
Filomeno Gallo after excluding a portion Identified as Lot "1-A" which is the site of the municipal hall of Buenavista town, and subjecting Lots
Nos. 1, 2 and 3 to the road-of-way of 15 meters width.

Petitioners appealed from said decision to the respondent Court of Appeals assigning the following errors in their brief:

THE TRIAL COURT ERRED IN ORDERING THE REGISTRATION OF THE SUBJECT LAND WHICH CONSISTS OF TIMBERLAND,
FORESHORELAND AND LAND BELONGING TO THE PUBLIC DOMAIN HENCE UNREGISTERABLE.

THE TRIAL COURT ERRED IN HOLDING THAT THE POSSESSION OF THE APPLICANT-APPELLEE AND HIS PREDECESSORS-
IN-INTEREST HAD BEEN PEACEFUL, OPEN, CONTINUOUS, UNINTERRUPTED AND ADVERSE TO CLAIMANTS AND IN THE
CONCEPT OF OWNER. (p. 6, Brief for the Petitioners, p. 105, Rollo)

Respondent court affirmed said decision and denied a motion for reconsideration of the same hence the present petition with two (2) assigned
errors, basically the same issues raised with the respondent court:

RESPONDENT COURT ERRED IN NOT HOLDING THAT THE DETERMINATION OF WHETHER A PUBLIC LAND IS
AGRICULTURAL OR STILL A FOREST LAND RESTS EXCLUSIVELY UPON THE DIRECTOR OF FORESTRY (NOW DIRECTOR OF
FOREST DEVELOPMENT), THE SECRETARY OF NATURAL RESOURCES) AND THE PRESIDENT OF THE PHILIPPINES.

RESPONDENT COURT ERRED IN NOT HOLDING THAT THE LAND IS PRESUMED TO BELONG TO THE PUBLIC DOMAIN AND
PRIVATE RESPONDENT HEREIN HAS NOT CONVINCINGLY SHOWN THAT THE REMOTE PREDECESSOR-IN-INTEREST
POSSESSED THE LAND IN QUESTION SINCE TIME IMMEMORIAL. (pp. 9 & 20, Brief for the Petitioners, p. 105, Rollo)

Out of the 30.5943 hectares applied for registration under the Torrens System, 11.1863 hectares are coconut lands and admittedly within the
disposable portion of the public domain. These are more particularly Identified as parcels "B," B-1", "B-2" and "B-3" of the sketch plan Exh.
"1-A." The rest, consisting of 19.4080 hectares and Identified as parcels A, A-1, A-2 and A-3 of the same plan Exh. "1-A," is now the center of
controversy of the present appeal.

Petitioners contend that respondent court completely ignored the undisputed facts that 1) the controverted area is within Timberland Block
"B," L.C. Project No. 38, L.C. Map No. 1971 of Buenavista, Iloilo and that 2) the certification of February 18, 1956 of the then Director of
Forestry to the effect that the area in question is needed for forest purposes. Respondent court in affirming the decision of the Iloilo trial court
ruled that although the controverted portion of 19.4080 hectares are mangrove and nipa swamps within Timberland Block "B," L.C. Project
No. 38, same cannot be considered part of the public forest not susceptible of private ownership since petitioners failed to submit convincing
proof that these lands are more valuable for forestry than for agricultural purposes, and the presumption is that these are agricultural lands.
Respondent court based its conclusion upon the premise that whether or not a controverted parcel of land is forest land, is a question of fact
which should be settled by competent proofs, and if such a question be an issue in a land registration proceeding, it is incumbent upon the
Director of Forestry to submit to the court convincing proofs that the land in dispute is not more valuable for agriculture than for forest
purposes. It is the position of respondent that respondent court did "not hesitate to apply this presumption with full force particularly where,
as in the case at bar, the lands applied for have been possessed and cultivated by the applicant and his predecessors-in-interest for a long
number of years without the government taking any positive step to dislodge the occupants from their holdings which have passed from one
to another by inheritance or by purchase." (p. 9, Brief for private respondents) Otherwise stated, it is Our impression that private respondents
claim the rule of prescription against the government.

Such contentions of private respondents do not hold water. Admittedly the controversial area is within a timberland block as classification of
the municipality and certified to by the Director of Forestry on February 18, 1956 as lands needed for forest purposes and hence they are
portions of the public domain which cannot be the subject of registration proceedings. Clearly therefore the land is public land and there is no
need for the Director of Forestry to submit to the court convincing proofs that the land in dispute is not more valuable for agriculture than for
forest purposes, as there was no question of whether the land is forest land or not. Be it remembered that said forest land had been declared
and certified as such by the Director of the Bureau of Forestry on February 18, 1956, several years before the original applicant of the lands
for registration Mercedes Diago, filed it on July 11, 1961. In the case of Government of the Philippine Islands vs. Abella, 49 Phil. 49, cited by
private respondents themselves in their brief, We held —

Following the decision of Ankon vs. Government of the Philippine Islands (40 Phil. 10), it is again held, that whether a
particular parcel of land is more valuable for forestry purposes than for agricultural purposes, or vice versa, is a fact which
must be established during the trial of the case. Whether the particular land is agricultural, forestry or mineral is a
question to be settled in each particular caseunless the Bureau of Forestry has, under the authority conferred upon it by
law, prior to the intervention of private interest, set aside said land for forestry or mineral resources. (Italics for emphasis)

We also held in the case of Republic vs. Animas, 56 SCRA 499, 503 that-

... As a general rule, timber or forest lands are not alienable or disposable under either the Constitution of 1935 or the
Constitution of 1973.

... It is the Bureau of Forestry that has jurisdiction and authority over the demarcation, protection, management,
reproduction, occupancy and use of all public forests and forest reservations and over the granting of licenses for the
taking of products therefrom, including stone and earth (Section 1816 of the Revised Administrative Code). That the area
in question is a forest or timber land is clearly established by the certification made by the Bureau of Forest Development
that it is within the portion of the area which was reverted to the category of forest land, approved by the President on
March 7, 1958.

As provided for under Sec. 6 of Commonwealth Act No. 141, which was lifted from Act No. 2874, the classification or reclassification of public
lands into alienable or disposable, mineral or forest lands is now a prerogative of the Executive Department of the government and not of the
courts. With these rules, there should be no more room for doubt that it is not the court which determines the classification of lands of the
public domain into agricultural, forest or mineral but the Executive Branch of the Government, through the Office of the President. Hence, it
was grave error and/or abuse of discretion for the respondent court to ignore the uncontroverted facts that (1) the disputed area is within a
timberland block and (2) as certified to by the then Director of Forestry, the area is needed for forest purposes.

Furthermore, private respondents Cannot claim to have obtained their title by prescription inasmuch as the application filed by them
necessarily implied an admission that the portions applied for are part of the public domain which cannot be acquired by prescription, unless
the law expressly permits it. It is a rule of law that possession of forest lands, however long, cannot ripen into private ownership (Director of
Forestry vs. Munoz, 23 SCRA 1184).

WHEREFORE, in the light of the foregoing, the assailed decision is hereby SET ASIDE, and a new one is hereby rendered, declaring that:

1) Parcels "B," "B-1," "B-2 and "B-3" of the sketch plan Exhibit "1-A" consisting of 11.1863 hectares of coconut land and admittedly within the
disposable portion of the public domain are hereby ordered registered in the name of the applicant Filomeno Gallo and/or his successors-in-
interest as provided for by the Public Land Law; and

2) Parcels "A," "A-1," and "A-2," and "A-3" of the same plan Exh. "1-A," consisting of 19.4080 hectares, are forest lands or lands of the public
domain of the Republic of the Philippines and are therefore inalienable. SO ORDERED.
G.R. No. L-35778 January 27, 1983

REPUBLIC OF THE PHILIPPINES, and THE DIRECTOR OF LANDS, petitioners,

vs.
HON. ABRAHAM P. VERA, Judge, CFI, Bataan, Branch I, and LUISITO MARTINEZ, respondents.

G.R. No. L-35779 January 27, l983

REPUBLIC OF THE PHILIPPINES, and THE DIRECTOR OF LANDS, petitioners,

vs.
HON. ABRAHAM P. VERA, judge, CFI, Bataan, Branch I, and THELMA TANALEGA, respondents.

The Solicitor General for petitioners.

Benjamin M. Reyes for private respondent.

DE CASTRO, J.:

The two (2) above-entitled petitions for review on certiorari of the decisions dated October 9, 1972 and October 16, 1972 issued by the CFI of
Bataan, Branch I, in LRC No. N-210, and in LRC No. N-206, respectively, involve a common issue. For convenience, they are hereby decided
jointly.

G.R. No. L-35778:

On May 4, 1972, respondent Luisito Martinez filed with the lower court an application for registration of title under Act 496 of one (1) parcel of
land, situated in the Municipality of Mariveles, Bataan, containing an area of 323,093 square meters, more or less.

On July 7, 1972 the lower court issued an order of general default except as to the Republic of the Philippines and the Province of Bataan.

On July 24, 1972, the Republic of the Philippines filed with the lower court an opposition to the application stating that the parcel of land
applied for is a portion of the public domain belonging to the Republic, not subject to private appropriation.

On September 16, 1972, the lower court issued an order reading:

Considering the testimony of the Provincial Forester Leonides B. Rodriguez during the hearing of August 8, 1972 that this
land, subject matter of this application, was a subject of cadastral proceeding and that this land was assigned as Lot No.
626 (Tsn, August 3, 1972, page 41), this case is ordered re-opened and the Land Registration Commissioner is directed to
submit his report and/or comment as to whether this lot is covered by the Mariveles Cadastre within five (5) days from
receipt hereof.

On October 5, 1972, the Commissioner of Land Registration submitted to the lower court a report stating.

That the parcel of land applied for registration in the above-entitled case is entirely inside Lot No. 626 of the Cadastral
Survey of Mariveles, Province of Bataan, Cad. Case no. 19, LTC Cad. Record No. 1097.

Records show that in the hearing of this case in the lower court, applicant Luisito Martinez, 62 years old, testified that he is the owner of the
land applied for, having inherited the same from his parents, consisting of 32 hectares, more or less; that he started possessing the land in
1938; that about 8 hectares of the land is planted to palay, and there are about 42 mango trees; that kamoteng kahoy is also planted
thereon; that he declared the land for taxation purposes only in 1969 because all the records were lost during the war, and that possession
was continuous, open, undisturbed and in the concept of owner.

Another witness, Antonio Reyes, 67 years old, testified that he is the overseer of Luisito Martinez; that the area of his land is 32 hectares,
more or less; that since 1938, applicant has possessed this land; that eight (8) hectares of land is devoted to palay, and his son Manuel
Reyes and Silvestre Garcia are the ones tilling the land, and the harvest is shared alike between applicant, on one hand, and Manuel Reyes
and Silvestre Garcia, on the other; that eighteen (18) hectares, more or less, is planted to vegetables.

While another witness, Silvestre Garcia, 60 years old, testified that he worked on the land of the applicant since 1932 which is 32 hectares,
more or less; that said Luisito Martinez inherited the land from his parents; that he plants palay only on four (4) hectares; that there are 42
mango trees on the land,

G.R. No. L-35779:

On March 21, 1972, respondent Thelma Tanalega filed an application for registration under Act No. 496 in the Court of First Instance of
Bataan, docketed as Land Registration Case No. N-206, L.R.C. Rec. No. N-41884, of two (2) parcels of land located in the barrio of Camaya,
municipality of Mariveles, province of Bataan, containing an area of 443,297 square meters, more or less, and 378,506 square meters, more
or less, respectively, and more particularly described and Identified as portions of Lot 626, Mariveles Cadastre, covered by Plans (LRC) SWO-
13430 and (LRC) SWO-13431, respectively.

On March 21, 1972, the corresponding notice of initial hearing was duly issued by the Commissioner of Land Registration.

On March 21, 1972, the lower court ordered the Bureau of Lands to submit a report within ten (10) days if the land subject of the application
has been issued patents or is the subject of any pending application for the issuance of patents. Likewise, the lower court directed the
Commissioner of Land Registration to submit within the same period his report if the land applied for has been issued a title or is the subject
of a pending decree.

On May 23, 1972, the Chief Surveyor of the Land Registration Commission filed a report in the lower court, stating that the parcels of land
applied for registration "do not appear to have been passed upon and approved by the Director of Lands as required by Section 1858 of the
Revised Administrative Code." Later, on July 24, 1972, the Chief Surveyor of the Land Registration Commission filed in the lower court
another report or manifestation stating "that Plans (LRC) SWO-13430 and 13431, LRC Case No. N-206, LRC Record No. N-41884, when
plotted on the Municipal Index Map on file in the Commission does not appear to overlap with any previously titled property under Act 496;
that the plan and records of said Land Registration application will be subjected to further examination as soon as the decision to be rendered
by this Honorable Court is received in this Commission to determine whether or not a patent or title has in the meantime been issued in order
to avoid duplication or overlapping of titles."

At the hearing on June 21, 1972, on motion of the applicant's counsel, the lower court issued an Order of General Default against all persons,
with the exception of the Director of Lands and the Director of Forestry, represented by the Office of the provincial fiscal, and the oppositor
Eliseo Martinez represented by Atty. Angelino Banzon, who were directed to file their respective oppositions,

On July 7, 1972, the provincial fiscal filed his opposition in behalf of the Directors of Lands and of Forestry, alleging that the parcels of land
applied for are portions of the public domain belonging to the Republic of the Philippines, not subject to private appropriation.

Thereafter, the case was tried. The applicant, Thelma Tanalega (respondent herein), testified in her behalf, and presented two (2) witnesses,
namely, Miguel Ocampo, 57 years old, and Agapito del Rosario, 50 years old, as well as her documentary evidence in support of her
application for registration. On the other hand,. Fiscal Arsenio Roman appeared for the government, and submitted documentary proof in
support of the opposition filed by the provincial fiscal's office in this case.

At the hearing of this case in the lower court, applicant Thelma Tanalega, 27 years old, testified that she had possessed the land "openly,
adversely, notoriously and in the concept of owner since February 2, 1970 when the said land was sold to her by Elisa Llamas who allegedly
possessed this land" in the same manner since 1935; that the applicant had paid for the taxes of the land for the years 1970-1972.

Another witness, Miguel Ocampo, 57 years old, testified that his parents were the ones working on the land before 1935 and due to the illness
of his parents, on their request to owner Elisa Llamas, he became overseer up to 1970 when the same was sold to applicant; that 16 hectares
of these lands were planted to palay while others were devoted to pasture land and planting vegetables.

Witness Agapito del Rosario, 50 years old, who testified that since childhood, he had known Elisa Llamas to be the owner of the land applied
for; that she was the one managing the planting and improving of the land; that he used to see Leopoldo de Guzman and another one also
named Agapito del Rosario worked on the 16 hectares portion of the land; that Elisa Llamas informed him that in 1970 she sold the land to
Thelma Tanalega.

At the hearing on August 24, 1972, Fiscal Arsenio Guzman who is appearing for the government, submitted a certification dated July 3, 1972
of Leonides B. Rodriguez, District Forester of Balanga, Bataan (Exhibit 3) which states "that the tract of land situated at Barrio Camaya,
Mariveles, Bataan containing an approximate area of EIGHTY TWO HECTARES more or less, as shown and described in the attached photostat
copy of Plans in two sheets, as surveyed for Thelma Tanalega, et al., was found to be within the Alienable and Disposable Block, Project 4-B,
Mariveles, Bataan, certified by the Director of Forestry as such on February 16, 1972."

The applicant did not present as witness her predecessor-in-interest, Elisa Llamas, to testify on the alleged possession of the land. The
applicant also failed to present Guillermo Ramirez, who was hired by her as overseer and her alleged tenants. Not a single tenant was
presented as witness to prove that the applicant had possessed the land as owners.

In both cases, the Court of First Instance of Bataan in two separate decisions, dated October 9, 1972 and October 16, 1972, confirmed the
titles to subject parcels of land and adjudicated them in favor of applicants Luisito Martinez and Thelma Tanalega, now respondents herein.

In the instant petitions for review the Republic of the Philippines, through the Solicitor General, argued that Lot 626, Mariveles Cadastre was
declared public land by the decision of the Cadastral Court dated October 11, 1937 and such being the case, the lower court is without
jurisdiction over the subject matter of the application for voluntary registration under Act 496. Petitioner likewise stressed that the lands in
question can no longer be subject to registration by voluntary proceedings, for they have already been subjected to compulsory registration
proceedings under the Cadastral Act.

The petitions are meritorious and reversal of the questioned decisions is in order.

It is noteworthy that as per the report of the Commissioner of Land Registration, 1 the land subject matter of the instant proceedings "is
entirely inside Lot No. 626 of the Cadastral Survey of Mariveles, Province of Bataan, Cad. Case No. 19, LRC Cad. Record No. 1097"; that some
portions of Lot No. 626 were decreed and titles were issued therefor; and that "portion declared Public Land as per decision dated October 11,
1937."

In a cadastral proceedings any person claiming any interest in any part of the lands object of the petition is required by Section 9 of Act No.
2259 to file an answer on or before the return day or within such further time as may be allowed by the court, giving the details required by
law, such as: (1) Age of the claimant; (2) Cadastral number of lot or lots claimed, or the block and lot numbers, as the case may be; (3)
Name of the barrio and municipality, township or settlement in which the lots are situated; (4) Names of the owners of adjoining lots; (5) If
claimant is in possession of the lots claims and can show no express grant of the land by the Government to him or to his predecessors-in-
interest, the answer need state the length of time property was held in possession and the manner it was acquired, giving the length of time,
as far as known, during which his predecessors, if any, held possession; (6) If claimant is not in possession or occupation of the land, the
answer shall set forth the interest claimed by him and the time and manner of its acquisition; (7) If the lots have been assessed for taxation,
their last assessed value; and (8) Encumbrance, if any, affecting the lots and the names of adverse claimants as far as known. In the absence
of successful claimants, the property is declared public land.

In the instant cases, private respondents apparently either did not file their answers in the aforesaid cadastral proceedings or failed to
substantiate their claims over the portions they were then occupying, otherwise, titles over the portions subject of their respective claims
would have been issued to them. The Cadastral Court must have declared the lands in question public lands, and its decision had already
become final and conclusive.

Respondents are now barred by prior judgment to assert their rights over the subject land, under the doctrine of res judicata. A cadastral
proceeding is one in rem and binds the whole world. Under this doctrine, parties are precluded from re-litigating the same issues already
determined by final judgment. 2

Even granting that respondents can still petition for judicial confirmation of imperfect title over the lands subject matter of the instant cases,
the same must necessarily fail. It is to be noted that in the instant cases evidence for the respondents themselves tend to show that only
portions of the entire area applied for are cultivated. A mere casual cultivation of portions of the land by the claimant does not constitute
possession under claim of ownership. In that sense, possession is not exclusive and notorious so as to give rise to a presumptive grant from
the State. The possession of public land however long the period thereof may have extended, never confers title thereto upon the possessor
because the statute of limitations with regard to public land does not operate against the State, unless the occupant can prove possession and
occupation of the same under claim of ownership for the required number of years to constitute a grant from the State. 3 Applicants,
therefore, have failed to submit convincing proof actual, peaceful and adverse possession in the concept of owners of the entire area in
question during the period required by law.
Apart from the foregoing, the survey plans submitted by petitioners were not approved by the Director of Lands but by the Land Registration
Commission. The Land Registration Commission has no authority to approve original survey plans in this particular case. Section 34-A of R.A.
No. 6389 relied upon by respondents applies only to lands subject of tenancy relation which are expropriated and sub-divided in favor of new
amortizing-owner-beneficiaries. The submission of the plan is a statutory requirement of mandatory character and unless the plan and its
technical description are duly approved by the Director of Lands, the same are not of much value. 4

WHEREFORE, the decisions dated October 9,1972 and October 16, 1972 of the Court of First Instance of Bataan, Branch I should be, as they
are hereby reversed. Without pronouncement as to costs. SO ORDERED.
 [G.R. No. 146030. December 3, 2002]

REPUBLIC OF THE PHILIPPINES, represented by the Department of Environment and Natural Resources, petitioner, vs. HEIRS
OF FELIPE ALEJAGA SR., represented by ROQUETA ALEJAGA, FELIPE ALEJAGA JR., MARIA DULLA ALEJAGA, FELIPE
ALEJAGA III, ROQUETA ALEJAGA, JENNIFER ALEJAGA, EVERETTE CAPUNDAN, AND LYNETTE ALEJAGA; THE PHILIPPINE
NATIONAL BANK and THE REGISTER OF DEEDS OF ROXAS CITY, respondents.

DECISION

PANGANIBAN, J.:

We reiterate the familiar doctrine that a free patent obtained through fraud or misrepresentation is void. Furthermore, the one-year
prescriptive period provided in the Public Land Act does not bar the State from asking for the reversion of property acquired through such
means.

Statement of the Case

Before us is a Petition for Review on Certiorari under Rule 45 of the Rules of Court, assailing the November 15, 2000 Decision[1] of the
Court of Appeals (CA) in CA-GR CV No. 44568. The decretal portion of the challenged Decision reads as follows:

WHEREFORE, the appealed decision is hereby REVERSED, SET ASIDE and RECALLED.[2]

The Facts

The factual antecedents of the case are summarized by the CA thus:

On December 28, 1978, [Respondent] Felipe Alejaga, Sr. x x x filed with the District Land Office, Roxas City, Free Patent Application No. (VI-
2) 8442 covering a parcel of land identified as Lot 1, Mli-06-000020-D, with an area of .3899 hectares, more or less located at Dumolog,
Roxas City (Exh. A; Exh 9). It appears that on December 27, 1978, when the application was executed under oath, Efren L. Recio, Land
Inspector, submitted a report of his investigation and verification of the land to the District Land Office, Bureau of Lands, City of Roxas. On
March 14, 1979, the District Land Officer of Roxas City approved the application and the issuance of [a] Free Patent to the applicant. On
March 16, 1979, the patent was also ordered to be issued and the patent was forwarded to defendant Register of Deeds, City of Roxas, for
registration and issuance of the corresponding Certificate of Title. Thereafter, Original Certificate of Title No. P-15 Free Patent No. (VI-2) 3358
was issued to [respondent] by defendant Register of Deeds.

On April 4, 1979, the heirs of Ignacio Arrobang, through counsel in a letter-complaint requested the Director of Lands, Manila, for an
investigation of the District Land Officer, Roxas City, and the Regional Office, Region VI, Iloilo City, for irregularities in the issuance of the title
of a foreshore land in favor of [respondent]. Isagani Cartagena, Supervising Special Investigator, Legal Division, Land Management Bureau
(formerly Bureau of Lands) submitted his Report dated April 17, 1989. The Chief, Legal Division, Land Management Bureau, Manila,
recommended to the Director of Lands appropriate civil proceeding for the cancellation of Free Patent Title No. (VI-2) 3358 and the
corresponding Original Certificate of Title No. P-15 in the name of [respondent].

In the meantime, [respondent] obtained a NACIDA loan under the Cottage Industry Guarantee and Loan Fund by the defendant Philippine
National Bank (hereinafter referred to as PNB) executed in Cebu City in the amount of P100,000.00 on August 18, 1981. The loan was
secured by a real estate mortgage in favor of defendant PNB. The promissory note of appellant was annotated at the back of the title.

On April 18, 1990, the government through the Solicitor General instituted an action for Annulment/Cancellation of Patent and Title and
Reversion against [respondent], the PNB of Roxas City and defendant Register of Deeds of Roxas City covering Free Patent Application (VI-2)
8442 of the parcel of land with an area of .3899 hectares more or less located at Dumolog, Roxas City.

On November 17, 1990, while the case is pending hearing, [respondent] died. He was substituted by his wife Roqueta Alejaga and his
children, namely: Everette Alejaga, Lynnette Alejaga, Felipe Alejaga, Jr., Maria Dulla Alejaga. Roqueta Alejaga, Jennifer Alejaga and Felipe
Alejaga III.

After hearing, the [trial] court in its dispositive portion decreed as follows:

WHEREFORE, judgment is rendered declaring that the approval of Free Patent Application No. 3358 and issuance of Original Certificate of Title
No. P-15 in the name of Felipe Alejaga is by means of fraud hence, null and void ab initio and the court orders:

a) the cancellation of the approval of the application No. (VI-2) 8442 covering Lot No. 1, Mli-06-000020-D with an area of .3899 hectares,
more or less, located at Dumulog, Roxas City;

b) the cancellation of Original Certificate of Title No. P-15, Free Patent No. (VI-2) 3358 in the name of Felipe Alejaga;

c) the land covered thereby as above described is reverted to the mass of the public domain;

d) the defendants, Heirs of Felipe Alejaga Sr. or defendant, Philippine National Bank, Roxas City Branch, to surrender the owners duplicate
copy of above described Original Certificate of Title No. P-15 to the Register of Deeds (now Registries of Land Titles and Deeds), Roxas City;

e) the defendant, Register of Deeds, Roxas City, to cancel Original Certificate of Title No. P-15 and the owners duplicate copy of said title
surrendered by above stated defendants;

f) defendants, Philippine National Bank, cross-claim is dismissed.

Costs against the defendants Heirs of Felipe, Alejaga, Sr.[3]

 Ruling of the Court of Appeals

In reversing the RTC, the CA ruled that petitioner failed to prove its allegation that respondents had obtained the free patent and the
Certificate of Title through fraud and misrepresentation.[4] The appellate court likewise held that, assuming there was misrepresentation or
fraud as claimed by petitioner, the action for reversion should have been brought within one (1) year from the registration of the patent with
the Registry of Deeds.[5]

Further, the CA brushed aside as hearsay Isagani Cartagenas testimony that Land Inspector Efren L. Recio had not conducted an
investigation on the free patent application of Felipe Alejaga Sr.[6] The CA added that petitioner had failed to support its claim that the lot
covered by respondents free patent and title was foreshore land.[7]

Hence, this Petition.[8]

Issues

Petitioner raises the following issues for this Courts consideration:

The Honorable Court of Appeals erred in not finding that the case is already final and executory as against respondent PNB.

II

The Court of Appeals erred in not considering that petitioner has proven the allegations to the Complaint.

III

The Honorable Court of Appeals erred in declaring that the action for reversion is unavailing.[9]

Simply stated, the issues can be summed up into two: (1) the efficacy of the grant of the free patent and (2) the indefeasibility of the
Certificate of Title issued in consequence thereof.

This Courts Ruling

The Petition is meritorious.

First Issue:
Efficacy of the Grant

Petitioner argues that it has proven fraud in the issuance of Respondent Alejagas free patent and Certificate of Title. [10] It also avers
that Respondent PNB has failed to file a timely Notice of Appeal.

On the other hand, the Alejagas contend that they have acquired a vested right over the parcel of land covered by OCT No. P-15 by
virtue of their proven open, actual, exclusive and undisputed possession of the land for more than 30 years. [11]

At the outset, we must immediately clarify that the records show receipt by Respondent PNB of a copy of the Decision on October 27,
not on October 3, 1993 as alleged by petitioner.[12] Further, the bank filed its Notice of Appeal on November 9, 1993, within the 15-day
reglementary period.

In addition, we must point out that the essential issue raised in this Petition -- the presence of fraud -- is factual. As a general rule, this
Court does not review factual matters.[13]However, the instant case falls under one of the exceptions, because the findings of the CA conflict
with those of the RTC and with the evidence on record.[14]

We begin our resolution of this issue with the well-settled rule that the party alleging fraud or mistake in a transaction bears the burden
of proof.[15] The circumstances evidencing fraud are as varied as the people who perpetrate it in each case.[16] It may assume different shapes
and forms; it may be committed in as many different ways.[17] Thus, the law requires that it be established by clear and convincing
evidence.[18]

In the case before us, we find that petitioner has adduced a preponderance of evidence before the trial court, showing manifest fraud in
procuring the patent.[19] This Court agrees with the RTC that in obtaining a free patent over the lot under scrutiny, petitioner had resorted to
misrepresentation or fraud, signs of which were[20] ignored by the Court of Appeals.[21]

First, the issuance of the free patent was not made in accordance with the procedure laid down by Commonwealth Act No. 141,
otherwise known as the Public Land Act.[22] Under Section 91 thereof, an investigation should be conducted for the purpose of ascertaining
whether the material facts set out in the application are true.[23]

Further, after the filing of the application, the law requires sufficient notice to the municipality and the barrio where the land is located,
in order to give adverse claimants the opportunity to present their claims. [24] Note that this notice and the verification and investigation of the
parcel of land are to be conducted after an application for free patent has been filed with the Bureau of Lands.

In this case, however, Felipe Alejaga Sr.s Application for Free Patent[25] was dated and filed on December 28, 1978. On the other hand,
the Investigation & Verification Report[26]prepared by Land Inspector Elfren L. Recio of the District Land Office of the Bureau of Lands of Roxas
City was dated December 27, 1978. In that Report, he stated that he had conducted the necessary investigation and verification in the
presence of the applicant. Even if we accept this statement as gospel truth, the violation of the rule cannot be condoned because, obviously,
the required notice to adverse claimants was not served.

Evidently, the filing of the application and the verification and investigation allegedly conducted by Recio were precipitate and beyond
the pale of the Public Land Act.[27] As correctly pointed out by the trial court, investigation and verification should have been done
only after the filing of the application. Hence, it would have been highly anomalous for Recio to conduct his own investigation and verification
on December 27, 1998, a day before Felipe Alejaga Sr. filed the Application for Free Patent.[28] It must also be noted that while the Alejagas
insist that an investigation was conducted, they do not dispute the fact that it preceded the filing of the application.[29]

Second, the claim of the Alejagas that an actual investigation was conducted is not sustained by the Verification & Investigation Report
itself, which bears no signature.[30] Their reliance on the presumption of regularity in the performance of official duty[31] is thus
misplaced. Since Recios signature does not appear on the December 27, 1978 Report, there can be no presumption that an investigation and
verification of the parcel of land was actually conducted. Strangely, respondents do not proffer any explanation why the Verification &
Investigation Report was not signed by Recio. Even more important and as will later on be explained, this alleged presumption of regularity --
assuming it ever existed -- is overcome by the evidence presented by petitioner.

Third, the report of Special Investigator Isagani P. Cartagena has not been successfully rebutted. In that report, Recio supposedly
admitted that he had not actually conducted an investigation and ocular inspection of the parcel of land. Cartagenas statement on Recios
alleged admission may be considered as independently relevant. A witness may testify as to the state of mind of another person -- the latters
knowledge, belief, or good or bad faith -- and the formers statements may then be regarded as independently relevant without violating the
hearsay rule.[32]

Thus, because Cartagena took the witness stand and opened himself to cross-examination, the Investigation Report[33] he had
submitted to the director of the Bureau of Lands constitutes part of his testimony. Those portions of the report that consisted of his personal
knowledge, perceptions and conclusions are not hearsay.[34] On the other hand, the part referring to the statement made by Recio may be
considered as independently relevant.[35]

The doctrine on independently relevant statements holds that conversations communicated to a witness by a third person may be
admitted as proof that, regardless of their truth or falsity, they were actually made. Evidence as to the making of such statements is not
secondary but primary, for in itself it (a) constitutes a fact in issue[36] or (b) is circumstantially relevant to the existence of such fact.[37]

Since Cartagenas testimony was based on the report of the investigation he had conducted, his testimony was not hearsay and was,
hence, properly admitted by the trial court.[38]

Based on the foregoing badges of fraud, we sustain petitioners contention that the free patent granted to Felipe Alejaga Sr. is
void.[39] Such fraud is a ground for impugning the validity of the Certificate of Title.[40] The invalidity of the patent is sufficient basis for
nullifying the Certificate of Title issued in consequence thereof, since the latter is merely evidence of the former. [41] Verily, we must uphold
petitioners claim that the issuance of the Alejagas patent and title was tainted with fraud.[42]

Second Issue:
Indefeasibility of Title

Petitioner contends that the State has an imprescriptible right to cause the reversion of a piece of property belonging to the public
domain.[43] On the other hand, the Alejagas claim that, pursuant to Section 32 of PD 1529[44] -- otherwise known as the Property Registration
Decree -- the one-year period for reversion has already lapsed.[45] Thus, the States Complaint for reversion should be dismissed.

We agree with petitioner.

True, once a patent is registered and the corresponding certificate of title issued, the land covered by them ceases to be part of the
public domain and becomes private property.Further, the Torrens Title issued pursuant to the patent becomes indefeasible a year after the
issuance of the latter.[46] However, this indefeasibility of a title does not attach to titles secured by fraud and misrepresentation. [47] Well-
settled is the doctrine that the registration of a patent under the Torrens System does not by itself vest title; it merely confirms the
registrants already existing one. Verily, registration under the Torrens System is not a mode of acquiring ownership.[48]

Therefore, under Section 101 of Commonwealth Act No. 141,[49] the State -- even after the lapse of one year -- may still bring an action
for the reversion to the public domain of land that has been fraudulently granted to private individuals.[50] Further, this indefeasibility cannot
be a bar to an investigation by the State as to how the title has been acquired, if the purpose of the investigation is to determine whether
fraud has in fact been committed in securing the title.[51]

In the case before us, the indefeasibility of a certificate of title cannot be invoked by the Alejagas, whose forebear obtained the title by
means of fraud.[52] Public policy demands that those who have done so should not be allowed to benefit from their misdeed.[53] Thus,
prescription and laches will not bar actions filed by the State to recover its own property acquired through fraud by private individuals.[54] This
is settled law.[55]

Prohibition Against Alienation or Encumbrance

Assuming arguendo that the Alejagas title was validly issued, there is another basis for the cancellation of the grant and the reversion of
the land to the public domain. Section 118 of Commonwealth Act No. 141[56] proscribes the encumbrance of a parcel of land acquired under a
free patent or homestead within five years from its grant.[57] The prohibition against any alienation or encumbrance of the land grant is a
proviso attached to the approval of every application.[58]

Further, corporations are expressly forbidden by law to have any right or title to, or interest in, lands that are granted under free or
homestead patents; or any improvements thereon.They are forbidden from enjoying such right, title or interest, if they have not secured
the consent of the grantee and the approval of the secretary of the Department of Agriculture and Natural Resources; and if s uch lands
are to be devoted to purposes other than education, charity, or easement of way. [59]

In the case at bar, Free Patent No. (VI-2) 3358[60] was approved and issued on March 14, 1979. Corresponding Original Certificate of
Title No. P-15[61] was issued on the same date.On August 18, 1981, or two (2) years after the grant of the free patent, Felipe Alejaga
Sr. obtained from Respondent PNB a loan[62] in the amount of P100,000. Despite the statement on the title certificate itself that the land
granted under the free patent shall be inalienable for five (5) years from the grant, a real estate mortgage was nonetheless constituted on the
parcel of land covered by OCT No. P-15.[63] In his testimony, Gabriel D. Aranas Jr., then Cashier III of respondent bank, even admitted that
the PNB was aware of such restriction.

COURT You testified Mr. Aranas that you inspected the title also when you credit investigated the loan applicant Felipe Alejaga and
you have personally examined this?

A Yes, your Honor.

COURT Do you conclude that this Original Certificate of Title is a [free] patent?

A Yes, your Honor.

COURT And this [free] patent was granted on March 19, 1979.

A Yes, your honor.

COURT And as such [free] patent it cannot be alienated except [to] the government or within five years from its issuance?

A Yes, your honor.

COURT Why did you recommend the loan?

A Because it is just a mortgage.[64]

Thus, the mortgage executed by Respondent Felipe Alejaga Sr. falls squarely within the term encumbrance proscribed by Section 118 of
the Public Land Act.[65] A mortgage constitutes a legal limitation on the estate, and the foreclosure of the mortgage would necessarily result in
the auction of the property.[66]
 As early as Pascua v. Talens,[67] we have explained the rationale for the prohibition against the encumbrance of a homestead -- its lease
and mortgage included -- an encumbrance which, by analogy, applies to a free patent. We ruled as follows:

It is well-known that the homestead laws were designed to distribute disposable agricultural lots of the State to land-destitute citizens for
their home and cultivation. Pursuant to such benevolent intention the State prohibits the sale or encumbrance of the homestead (Section
116) within five years after the grant of the patent.

Further, an encumbrance on a parcel of land acquired through free patent constitutes sufficient ground for the nullification of such
grant, as provided under Commonwealth Act No. 141, which we quote:

SEC. 124. Any acquisition, conveyance, alienation, transfer, or other contract made or executed in violation of any of the provisions of
sections one hundred and eighteen, one hundred and twenty, one hundred and twenty-one, one hundred and twenty-two, and one hundred
and twenty-three of this Act shall be unlawful and null and void from its execution and shall produce the effect of annulling and canceling the
grant, title, patent, or permit originally issued, recognized or confirmed, actually or presumptively, and cause the reversion of the property
and its improvements to the State.

Mortgage over a parcel of land acquired through a free patent grant nullifies the award and constitutes a cause for the reversion of the
property to the state, as we held in Republic v. Court of Appeals:[68]

The foregoing legal provisions clearly proscribe the encumbrance of a parcel of land acquired under a free patent or homestead within five
years from the grant of such patent. Furthermore, such encumbrance results in the cancellation of the grant and the reversion of the land to
the public domain.[69]

To comply with the condition for the grant of the free patent, within five years from its issuance, Felipe Alejaga Sr. should not have
encumbered the parcel land granted to him. The mortgage he made over the land violated that condition.[70] Hence, the property must
necessarily revert to the public domain, pursuant to Section 124 of the Public Land Act.

WHEREFORE, the Petition is GRANTED and the assailed Decision SET ASIDE. The Decision of the RTC of Roxas City (Branch 15) dated
October 27, 1993 is REINSTATED. No costs. SO ORDERED.
REPUBLIC OF THE PHILIPPINES, G.R. No. 156951
Petitioner,

Promulgated:

- versus -
September 22, 2006

SOUTHSIDE HOMEOWNERS ASSOCIATION, INC. and the

REGISTER OF DEEDS OF PASIG, RIZAL,
Respondents.
x-------------------------------------------x

BASES CONVERSION DEVELOPMENT AUTHORITY,

Intervenor,
x-------------------------------------------x

DEPARTMENT OF NATIONAL DEFENSE, represented by HON.

SECRETARY ANGELO T. REYES, and the ARMED FORCES OF THE
PHILIPPINES, represented by CHIEF OF STAFF, AFP, GENERAL
NARCISO L. ABAYA,
Intervenors.
x-------------------------------------------x

RENE A.V. SAGUISAG, MGEN. MARCIANO ILAGAN (Ret.), MGEN. G.R. No. 173408
PONCIANO MILLENA (Ret.), BGEN. JUANITO MALTO (Ret.),
BGEN. RAYMUNDO JARQUE (Ret.) and COL. DOMINADOR P.
AMADOR (Ret.),
Petitioners,

- versus -

L/T. GEN. HERMOGENES C. ESPERON, JR.,

Respondent.
x-----------------------------------------------------------------------------------------x

DECISION

GARCIA, J.:

Before the Court are these two petitions having, as common denominator, the issue of ownership of a large tract of land.

In the first, a petition for review under Rule 45 of the Rules of Court and docketed as G.R. No. 156951, the petitioner Republic of

the Philippines seeks to nullify and set aside the Decision [1] dated January 28, 2003 of the Court of Appeals (CA) in CA-G.R. CV No.

59454, affirming the dismissal by the Regional Trial Court (RTC) of Pasig City, Branch 71, of the Republics complaint for declaration of nullity

and cancellation of a land title against the herein private respondent, the Southside Homeowners Association, Inc. (SHAI).

In the second, docketed as G.R. No. 173408, petitioners Rene Saguisag and five (5) retired military officers pray that Lt.

Gen. Hermogenes C. Esperon, Jr., the present Chief of Staff of the Armed Forces of the Philippines (AFP), be asked to show cause why he

should not be cited for contempt for having announced time and again that the military officers and their families in the contempt action

would be ousted and evicted from the property subject of the main petition even before the issue of ownership thereof is finally resolved by

the Court.

After the private respondent SHAI had filed its Comment[2] to the petition in G.R. No. 156951, the Bases Conversion Development

Authority (BCDA), followed by the Department of National Defense (DND) and the AFP, joined causes with the petitioner Republic and thus

sought leave to intervene. The Court, per its Resolutions dated September 3, 2003, [3] and September 29, 2003,[4] respectively, allowed the

intervention and admitted the corresponding petitions-for-intervention.

Per Resolution of the Court dated August 09, 2006, both petitions were ordered consolidated.

The Republics recourse in G.R. No. 156951 is cast against the following backdrop:

On July 12, 1957, then President Carlos P. Garcia issued Proclamation No. 423[5] establishing a military reservation known as Fort

William McKinley later renamedFort Andres Bonifacio Military Reservation (FBMR). The proclamation withdr[ew] from sale or settlement

and reserve[d] for military purposes, under the administration of the Chief of Staff of the [AFP] the [certain] parcels of the public domain

[indicated in plan Psu-2031] situated in the several towns and a city of what was once the Provinceof Rizal. On its face, the proclamation
covers three (3) large parcels of land, to wit: Parcel No. 2 (portion), Parcel No. 3 (or 3-A) and Parcel No. 4 (or 4-A). Parcel No. 3 with an area

of 15,912,684 square meters and Parcel No. 4 with an area of 7,660,128 square meters are described in the proclamation as situated inside

Fort McKinley, Rizal. Specifically mentioned as excluded from Parcel No. 4 albeit within its boundaries are

the American Battle Monument Cemetery (606,985 sq. m.), the Traffic Circle (7,093 sq. m.) and the Diplomatic and Consular area

(100,000 sq.m.).

Several presidential proclamations would later issue excluding certain defined areas from the operation of Proclamation No. 423 and

declaring them open for disposition. These are Proclamation No. 461[6] and Proclamation No. 462,[7] both series of 1965, excluding portions of

the reservation and declaring them the AFP Officers Village and the AFP EMs Village, respectively, to be disposed of under Republic Act (R.A.)

274[8] and R.A. 730[9] in relation to the Public Land Act (C.A. 141, as amended). Excluded, too, under Proclamation No. 172 dated October 16,

1987 and to be disposed pursuant to the same laws aforementioned, save those used or earmarked for public/quasi-public purposes, are

portions of the reservation known as Lower and Upper Bicutan, Western Bicutan and the Signal Village, all in Taguig, Metro Manila.

In 1992, Congress enacted the Bases Conversion and Development Act (R.A. 7227, as amended), investing the BCDA the power to

own, hold and administer portions of Metro Manila military camps that may be transferred to it by the President [10] and to dispose, after the

lapse of a number of months, portions of Fort Bonifacio.[11]

At the core of the instant proceedings for declaration of nullity of title are parcels of land with a total area of 39.99 hectares, more
or less, known as or are situated in what is referred to as the JUSMAG housing area in Fort Bonifacio. As may be gathered from the
pleadings, military officers, both in the active and retired services, and their respective families, have been occupying housing units and
facilities originally constructed by the AFP on the JUSMAG area.

Private respondent SHAI is a non-stock corporation organized mostly by wives of AFP military officers. Records show that SHAI was
able to secure from the Registry of Deeds of the Province of Rizal a title Transfer Certificate of Title (TCT) No. 15084[12] - in its name to the
bulk of, if not the entire, JUSMAG area. TCT No. 15084 particularly describes the property covered thereby as follows:

A parcel of land (Lot 3-Y-1, Psd-76057, being a portion of Parcel 3 of plan Psu-2031) situated in Jusmang (sic)
Area, Fort Bonifacio, Province of Rizal. containing an area of (398,602) SQUARE METERS. xxx.

A parcel of land (Lot 3-Y-2, Psd-76057 as shown on subdivision Plan Psd 76057, being a portion of parcel 3 of
plan Psu-2031, LRC Rec. No.) situated in Jusmang (sic) Area, FortBonifacio, Province of Rizal. containing an area of
(1,320) SQUARE METERS xxx.. (Underscoring added.)

The Rizal Registry issued TCT No. 15084 on October 30, 1991 on the basis of a notarized Deed of Sale[13] purportedly executed on
the same date by then Director Abelardo G. Palad, Jr. (Palad, for brevity) of the Lands Management Bureau (LMB) in favor of SHAI. The total
purchase price as written in the conveying deed wasP11,997,660.00 or P30.00 per square meter.
It appears that in the process of the investigation conducted by the Department of Justice on reported land scams at the FBMR, a
copy of the aforesaid October 30, 1991deed of sale surfaced and eventually referred to the National Bureau of Investigation (NBI)
for examination. The results of the examination undertaken by NBI Document Examiner Eliodoro Constantino are embodied in his Questioned
Documents Report (QDR) No. 815-1093.[14] Its highlights:

QUESTIONED SPECIMENS:
1. Original copy of the Deed of Sale issued in favor of the Navy Officers Village Association (NOVA) containing the
signature of ABELARDO G. PALAD, JR. designated as Q-961 .

2. Original copy of the Deed of Sale issued in favor of SHAI containing the signature of ABELARDO G. PALAD, JR.
... designated as Q-962.

xxx xxx xxx

PURPOSE OF EXAMINATION:
To determine whether or not the questioned and sample/specimen signatures ABELARDO G. PALAD, JR. were
written by one and the same person.

FINDINGS:

Scientific comparative examination and analysis of the specimens, submitted, under stereoscopic microscope and
magnifying lens, with the aid of photographic enlargement reveals that there exist fundamental, significant differences in
writing characteristics between the questioned and the standard/sample signatures "ABELARDO G. PALAD, JR." such as in:

- The questioned signatures show slow, drawn, painstaking laborious manner in execution of strokes; that of the
standard/sample signatures show free, rapid coordinated and spontaneous strokes in the manner of execution of
letters/elements.
 Furthermore, the questioned signature "ABELARDO G. PALAD, JR." marked "Q-961" is a product of TRACING
PROCESS by CARBON-OUTLINE METHOD.

CONCLUSION:

Based on the above FINDINGS, the questioned and the standard/sample signatures "ABELARDO G. PALAD, JR."
were not written by one and the same person.

The questioned signature "ABELARDO G. PALAD, JR." marked "Q-961" is a TRACED FORGERY by carbon process.

REMARKS:

The other questioned Deeds of Sale containing the signatures of "ABELARDO G. PALAD, JR." are still in the
process of examination.[15]

On October 16, 1993, then President Fidel V. Ramos issued Memorandum Order No. 173[16] directing the Office of the Solicitor
General (OSG) to institute action towards the cancellation of TCT No. 15084 and the title acquired by the Navy Officers Village Association
(NOVA) over a bigger parcel within the reservation. A month later, the OSG, in behalf of the petitioner Republic, filed with the RTC of Pasig
City the corresponding nullification and cancellation of title suit against the private respondent SHAI. In its complaint, docketed as Civil Case
No. 63883 and eventually raffled to Branch 71 of the court, the Republic alleged that fraud attended SHAIs procurement of TCT No. 15084. In
paragraph No. 5 of the complaint, the Republic alleged that TCT No. 15084 is void owing, inter alia, to the following circumstances: a) the
conveying deed is spurious as the purported signature thereon of Palad is a forgery; b) there are no records with the LMB of (i) the
application to purchase and (ii) the alleged payment of the purchase price; and c) the property in question is inalienable, being part of a
military reservation established under Proclamation No. 423.[17]
In its ANSWER with counterclaim, respondent SHAI denied the material allegations of the complaint and countered that the impugned title as
well as the October 30, 1991 Deed of Sale are valid documents which the Republic is estopped to deny.[18] SHAI also alleged paying in full the
purchase price indicated in the deed as evidenced byOfficial Receipt No. 6030203-C dated October 29, 1991.

On October 19, 1994, the case was heard on pre-trial in the course of which the Republic, as plaintiff therein, marked (and later offered in
evidence) the Deed of Sale dated October 30, 1991 as its Exhibit "A," and TCT No. 15084 as Exhibit "B." Respondent,
then defendant SHAI adopted Exhibits "A" and B as its Exhibits "1" and 2,respectively. As the pre-trial order was written, it would appear
that the parties agreed to limit the issue to the due execution and genuineness of Exhs. A and B.[19]

During the trial, the Republic presented as expert witness NBI Document Examiner Eliodoro Constantino who testified on NBI QDR
No. 815-1093 and asserted that the signature of Palad in Exhibit A is a forgery. For his part, Palad dismissed as forged his signature
appearing in the same document and denied ever signing the same, let alone in front of a notary public holding office outside of the LMB
premises. Pressing the point, Palad stated that he could not have had signed the conveying deed involving as it did a reservation area which,
apart from its being outside of the LMBs jurisdiction, is inalienable in the first place. The testimony of other witnesses revolved around the
absence of bureau records respecting SHAIs application to acquire, payment of the purchase price and Psd-76057, the plan described in TCT
No. 15084. [20]
For its part, then defendant SHAI presented an opposing expert witness in the person of Police Inspector Redencion Caimbon who
brought with him PNP QDR No. 001-96 and testified that Palads signature in Exhibit A (same as Exh. 1) is genuine. Mrs. Virginia Santos,
then SHAI president, likewise testified, saying that applications to purchase were signed and then filed with the LMB by one Engr. Eugenia
Balis,[21] followed by the payment in full of the contract price. Atty. Vicente Garcia, the then Register of Deeds of Rizal, also testified about his
having endorsed to Palad a letter-inquiry he received from SHAI respecting the authenticity of TCT No. 15084. Palads response-letter
dated January 23, 1992 (Exh. 10), according to Atty. Garcia, is to the effect that TCT No. 15084 must be genuine as it emanated from the
Registrys office on the basis of the October 30, 1991 Deed of Sale.[22]

On rebuttal, Palad would deny authorship of Exhibit 10 and an LMB official would disclaim transmitting the same to Atty. Garcia.

Eventually, in a decision[23] dated October 7, 1997, the trial court rendered judgment dismissing the Republics complaint, to wit:

WHEREFORE, in view of the foregoing, the Complaint dated November 15, 1991 is hereby DISMISSED
without pronouncement as to costs.

The counterclaims are also DISMISSED.

SO ORDERED.

In not so many words, the trial court considered the parcels covered by the deed in question as no longer part of the FBMR.

Therefrom, the Republic went on appeal to the CA whereat its appellate recourse was docketed as CA-G.R. CV No. 59454.

In the herein assailed Decision[24] dated January 28, 2003, the appellate court affirmed in toto that of the trial court.
Hence, this petition of the Republic on the threshold abstract submission that the CA completely ignored, overlooked and/or grossly

misappreciated facts of substance which, if duly considered, will materially affect the outcome of this case.

In its COMMENT To Petition, private respondent SHAI parlays the what-can-be-raised line. It urges the dismissal of the petition on the ground

that the issues raised therein, particularly those bearing on the authenticity of Exhibit A/1, are mainly questions of fact, adding that the

matter of the inalienability of the area purportedly sold is outside the issue agreed upon during the pre-trial stage.

The desired dismissal cannot be granted on the bases of the reasons proffered above.

While the Court, in a petition for review of CA decisions under Rule 45 of the Rules of Court, usually limits its inquiry only to

questions of law, this rule is far from absolute. Reyes v. Court of Appeals,[25] citing Floro v. Llenado,[26] for one, suggests as

much. In Floro, we wrote:

xxx There are, however, exceptional circumstances that would compel the Court to review the finding of facts of
the [CA], summarized in and subsequent cases as follows: 1) when the inference made is manifestly mistaken, absurd or
impossible; 2) when there is grave abuse of discretion; 3) when the finding is grounded entirely on speculations, surmises
or conjectures; 4) when the judgment of the [CA] are based on misapprehension of facts; 5) when the findings of facts are
conflicting; 6) ; 7) ; 8) ; 9) when the [CA] manifestly overlooked certain relevant facts not disputed by the parties and
which if properly considered would justify a different conclusion; and 10) when the findings of facts are premised on the
absence of evidence and are contradicted by the evidence on record. (Words in bracket, added.)

To the mind of the Court, the instant case is within the purview of at least three of the exceptions listed above, foremost of which is item #9.

Private respondent SHAIs stance about the petitioner Republic being barred from raising the issue of inalienability since it failed to plead or

assert the same at the pre-trial proceedings is, to a degree, correct. For the general rule, as articulated in Permanent Concrete Products, Inc.

v. Teodoro,[27] is that the determination of issues at a pre-trial conference bars the consideration of others on appeal. It should be pointed

out, however, that the rationale for such preliminary, albeit mandatory, conference is to isolate as far as possible the trial out of the realm of

surprises and back-handed maneuverings. And lest it be overlooked, the adverted rule on the procedure to be observed in pre-trials is,

asBergano v. Court of Appeals[28] teaches, citing Gicano v. Gegato,[29] subject to exceptions. And without meaning to diminish the importance

of the same rule, the Court is possessed with inherent power to suspend its own rules or to except a particular case from its operations

whenever the demands of justice so require.[30]

Given the foregoing considerations, the rule to be generally observed in pre-trial conferences hardly poses an insurmountable

obstacle to tackling the question of inalienability which, under the premises, is an issue more legal than factual. As it were, the element of

surprise is not really present here. For the issue of inalienability, which is central to the Republics cause of action, was raised in its basic

complaint, passed upon by the CA and, before it, by the trial court[31] and of which at least one witness (Palad) was examined as follows:

Q: Mr. Witness you stated that the parcel of land in question at the time of the land alleged sale was part of the
[FBMR]. Now as part of the [FBRM] do you know whether the said parcel of land can be the subject of disposition?

A: If it is part of the reservation it cannot be sold and it is already part of those government lands that has been
assigned to other government agencies that is no longer within my jurisdiction. Meaning to say I have no more say on that
because the proclamation to the effect was reserving this for particular purpose under the DND .[32] (Words in bracket
added.)

At any rate, Palads testimony drew nary an objection from private respondent SHAI. It even cross-examined said witness.[33] The

rule obtains that the introduction of evidence bearing on an issue not otherwise included in the pre-trial order amounts to implied consent

conferring jurisdiction on the court to try such issue.[34]

Digressing from the procedural aspects of this case, we now consider the clashing assertions regarding the JUSMAG area. Was it,

during the period material, alienable or inalienable, as the case may be, and, therefore, can or cannot be subject of a lawful private

conveyance?

Petitioner Republic, as do the intervenors, asserts the inalienable character of the JUSMAG area, the same having not effectively

been separated from the military reservation and declared as alienable and disposable.
 The Republics and the intervenors parallel assertions are correct.

The President, upon the recommendation of the Secretary of Environment and Natural Resources, may designate by proclamation

any tract or tracts of land of the public domain as reservations for the use of the Republic or any of its branches, or for quasi-public uses or

purposes.[35] Such tract or tracts of land thus reserved shall be non-alienable and shall not be subject to sale or other disposition until again

declared alienable.[36] Consistent with the foregoing postulates, jurisprudence teaches that a military reservation, like the FBMR, or a part

thereof is not open to private appropriation or disposition and, therefore, not registrable, [37] unless it is in the meantime reclassified and

declared as disposable and alienable public land.[38] And until a given parcel of land is released from its classification as part of the military

reservation zone and reclassified by law or by presidential proclamation as disposable and alienable, its status as part of a military reservation

remains,[39] even if incidentally it is devoted for a purpose other than as a military camp or for defense. So it must be here.

There can be no quibbling that the JUSMAG area subject of the questioned October 30, 1991 sale formed part of the FBMR as

originally established under Proclamation No. 423. And while private respondent SHAI would categorically say that the petitioner Republic had

not presented evidence that subject land is within military reservation, [40] and even dared to state that the JUSMAG area is the private

property of the government and therefore removed from the concept of public domain per se,[41] its own evidence themselves belie its

posture. We start with its Exhibit 2 (petitioners Exh. B), a copy of TCT No. 15084, which described the area covered thereby measuring

399,922 square meters as a portion of Parcel 3 of plan Psu-2031 situated in Jusmang (sic) area Fort Bonifacio. Complementing its Exhibit

2 is its Exhibit 1 - the deed of sale - which technically described the property purportedly being conveyed to private respondent SHAI as

follows:

A PARCEL OF LAND (Lot 3-Y-1, Psd-76067, being a portion of Parcel 3 of plan Psu-2031) situated in Jusmag
(sic) area, Fort Bonifacio, Province of Rizal. Xxx (Emphasis added)

As the Court distinctly notes, the disputed property, as described in private respondents Exhibits 1 and 2, formed part of that wide

expanse under Proclamation No. 423 which lists, as earlier stated, three (3) parcels of land of the public domain as falling within its coverage.

These include, inter alia, the entire 15,912,684-square meter area constituting Parcel No. 3 of Plan Psu 2031 located inside the now

renamed Fort Mckinley which, to a redundant point, was declared a military reservation.

The Court has, on the issue of inalienability, taken stock of the Compilation Map of Approved Surveys Plan inside Parcels 1, 2, 3 and

4, of plan Psu 2031[42] prepared in September 1995 and certified by the Department of Environment and Natural Resources

(DENR). It indicates in colored ink the outlines of Parcels 2, 3 and 4 covered by Proclamation No. 423. As there also shown, the 399,992-

square meter area embraced by SHAIs TCT No. 15084, defined in the legend by red-colored stripes, is within the violet-colored borders

of Parcel No. 3 and Parcel No. 4 of Proclamation No. 423.

Indubitably, the area covered by SHAIs TCT No. 15084 was and is still part of the FBMR, more particularly within the 15,912,684-

square meter Parcel No. 3 of the reservation. The petitioner Republic, joined by the intervenors BCDA, DND and AFP in this appellate

proceedings, has maintained all along this thesis. Towards discharging its burden of proving that the disputed property is part of the

reservation, the petitioner Republic need only to demonstrate that all of the 15,912,684 square meters of Parcel No. 3 of Plan Psu 2031 have

been reserved for military purposes. The evidence, however, of the fact of reservation is the law or, to be more precise, Proclamation No. 423

itself, the contents and issuance of which courts can and should take judicial notice of under Section 1, Rule 129 of the Rules of Court.[43]

The Republic has, since the filing of its underlying complaint, invoked Proclamation No. 423. In the process, it has invariably invited

attention to the proclamations specific area coverage to prove the nullity of TCT No. 15084, inasmuch as the title embraced a reserved area

considered inalienable, and hence, beyond the commerce of man. In this regard, the appellate court seemed to have glossed over, if not

entirely turned a blind eye on, certain admissions made by the private respondent, the most basic being those made in its answer to the
Republics allegations in paragraph 5 (e) and (g) of its complaint. To the Republics allegations that the property covered by TCT No. 15084

was and remains part the FBMR, SHAIs answer thereto reads:

2. It specifically denies the allegations in paragraphs 5 of the complaint, the truth of the matter being
that in the Deed of Sale , the Director of Lands Certificate (sic) that he is authorized under the law to sell the subject
property and that the lots were duly awarded by the [LBM] to the vendee.[44] ( Emphasis and word in bracket added.)

In net effect, private respondent SHAI admitted what the petitioner Republic alleged in par. 5 (e) and (g) of the complaint, the

formers denial to such allegations on the inalienable nature of the property covered by TCT No. 15084 being in the nature of a general denial.

Under the rules on pleadings, a specific, not a general, denial is required; a denial is not specific because it is so qualified or termed specific

by the pleader.[45] The defendant must specify each material factual allegation the truth of which he absolutely denies and, whenever

practicable, shall set forth the substance of the matters upon which he will rely to support his denial. [46] Else, the denial will be regarded as

general and will, therefore, be regarded as an admission of a given material fact/s stated in the complaint.

What private respondent SHAI did under the premises was to enter what, under the Rules, is tantamount to a general denial of the

Republics averments that what SHAIs TCT No. 15084 covers is part of the military reservation. In the process, private respondent SHAI is

deemed to admit the reality of such averment.

To be sure, the petitioner Republic, as plaintiff below, had more than sufficiently established its claim on the inalienability of the

parcels of land covered by TCT No. 15084. In fine, it had discharged the burden of proof on the issue of inalienability. Be that as it may, the

burden of evidence to disprove inalienability or, to be precise, that said parcels of land had, for settlement purposes, effectively been

withdrawn from the reservation or excluded from the coverage of Proclamation No. 423, devolves upon the private respondent. This is as it

should be for the cogency of SHAIs claim respecting the validity of both the underlying deed of sale (Exh. A/1) and its TCT No. 15084 (Exh.

B/2) rests on the postulate that what it purportedly bought from the LMB had ceased to be part of the reserved lands of the public domain.

Elsewise put, SHAI must prove that the JUSMAG area had been withdrawn from the reservation and declared open for disposition, failing

which it has no enforceable right over the area as against the State.

Private respondent SHAI has definitely not met its burden by reason of lack of evidence. To be sure, it has not, because it cannot

even if it wanted to, pointed to any presidential act specifically withdrawing the disputed parcels from the coverage of Proclamation No.

423. Worse still, its own Exhibit 5,[47] a letter dated March 19, 1991 of then PA Commanding General, M/Gen Lisandro Abadia, to one Mrs.

Gabon, then President of the SHAI, cannot but be viewed as a partys judicial admission that the disputed land has yet to be excluded from

the military reservation. The Abadia letter, with its feature dis-serving to private respondent SHAI, reads in part as follows:

Dear Mrs. Gabon:

This is in connection with your move to make a petition to President Aquino regarding the possible exclusion of
Southside Housing Area from the military reservation and for its eventual allotment to the military officers presently
residing thereat. Allow me to state that I interpose no objection . I find it helpful to our officers to be provided a portion of
the FortBonifacio military reservation . (Underscoring added.)

Owing to the foregoing considerations, the Court is hard put to understand how the CA could still have found for SHAI.. The

appellate court, apparently swayed by what SHAI said in its Brief for the Appellees[48] that:

Appellant [petitioner Republic] is probably unaware that , then President Diosdado Macapagal issued
Proclamation 461 when he excluded from the operation of Proclamation No. 423 an area of 2,455,810 square meters more
or less. Likewise on October 16, 1987, then President Corazon Aquino issued Proclamation No. 172 excluding five (5)
parcels of land from the operation of Proclamation No. 423 also located at Fort Bonifacio containing an area of 4,436, 478 .
So if we deduct the 6,892,288 [2,455,810 + 4,436,478 = 6,892,288] square meters covered by Proclamation Nos. 461
and 172 of the areas reserved for military purposes of 7,053,143 square meters, what is only left is 160,857 square
meters or more or less 16 hectares .[49]

justified its holding on the alienability of the disputed land with the following disquisition:

The foregoing admission aside, appellants [now petitioners] reliance on Proclamation No. 493 [should be 423] in insisting
that the land in litigation is inalienable because it is part of the [FBMR] is too general to merit serous consideration. While
it is true that, under the said July 12, 1957 Proclamation, then President Carlos P. Garcia reserved the area now
known as FortBonifacio for military purposes, appellee [now respondent] correctly calls our attention to the fact, among
 other matters, that numerous exceptions thereto had already been declared through the years. The excluded areas under
Proclamation No. 461, dated September 29, 1965 and Proclamation No. 172, dated October 16, 1987 alone already total
6,892,338 square meters.(Figures in bracket added.)

The CAs justifying line does not commend itself for concurrence.

For one, it utilizes SHAIs misleading assertion as a springboard to justify speculative inferences. Per our count, Proclamation 423

reserved for military purposes roughly a total area of 25,875,000 square meters, not 7,053,143. On the other hand, Proclamation Nos. 461

and 172 excluded a combined area of 6,892,338 square meters. Now then, the jump from an acknowledgment of the disputed parcels of

land having been reserved for military purposes to a rationalization that they must have been excluded from the reservation because

6,892,338 square meters had already been withdrawn from Proclamation 423 is simply speculative. Needless to stress, factual speculations

do not make for proof.

Corollary to the first reason is the fact that private respondent SHAI - and quite understandably, the appellate court - had not

pointed to any proclamation, or legislative act for that matter, segregating the property covered by TCT No. 15084 from the reservation and

classifying the same as alienable and disposable lands of the public domain. To reiterate what we earlier said, lands of the public domain

classified as a military reservation remains as such until, by presidential fiat or congressional act, the same is released from such classification

and declared open to disposition.[50] The October 30, 1991 Deed of Sale purportedly executed by Palad, assuming for the nonce its

authenticity, could not plausibly be the requisite classifying medium converting the JUSMAG area into a disposable parcel. And private

respondent SHAIs unyielding stance that would have the Republic in estoppel to question the transfer to it by the LMB Director of the JUSMAG

area is unavailing. It should have realized that the Republic is not usually estopped by the mistake or error on the part of its officials or

agents.[51]

Since the parcels of land in question allegedly sold to the private respondent are, or at least at the time of the supposed transaction

were, still part of the FBMR, the purported sale is necessarily void ab initio.

The Court can hypothetically concede, as a matter of fact, the withdrawal of the JUSMAG area from the ambit of Proclamation No.

423 and its reclassification as alienable and disposable lands of the public domain. Still, such hypothesis would not carry the day for private

respondent SHAI. The reason therefor is basic: Article XII, Section 3[52] of the 1987 Constitution forbids private corporations from acquiring

any kind of alienable land of the public domain, except through lease for a limited period. While Fr. Bernas had stated the observation that

the reason for the ban is not very clear under existing jurisprudence, [53] the fact remains that private corporations, like SHAI,are prohibited

from purchasing or otherwise acquiring alienable public lands.

Even if on the foregoing score alone, the Court could write finis to this disposition. An appropriate closure to this case could not be

had, however, without delving to an extent on the issue of the validity of the October 30, 1991 Deed of Sale which necessarily involves the

question of the authenticity of what appears to be Palads signature thereon.

With the view we take of the case, the interplay of compelling circumstances and inferences deducible therefrom, would, as a package, cast

doubt on the authenticity of such deed, if not support a conclusion that the deed is spurious. Consider:

1. Palad categorically declared that his said signature on the deed is a forgery. The Court perceives no reason why he should lie, albeit
respondent states, without elaboration, that Palads declaration is aimed at avoiding criminal prosecution.[54] The NBI signature expert
corroborated Palads allegation on forgery.[55] Respondent SHAIs expert witness from the PNP, however, disputes the NBIs findings. In net
effect, both experts from the NBI and the PNP cancel each other out.

2. Palad signed the supposed deed of sale in Manila, possibly at the LMB office at Plaza Cervantes, Binondo. Even if he acted in an official
capacity, Palad nonetheless proceeded on the same day to PasigCity to appear before the notarizing officer. The deed was then brought to
the Rizal Registry and there stamped Received by the entry clerk. That same afternoon, or at 3:14 p.m. of October 30, 1991 to be precise,
TCT No. 15084 was issued. In other words, the whole conveyance and registration process was done in less than a day. The very unusual
dispatch is quite surprising. Stranger still is why a bureau head, while in the exercise of his functions as the bureaus authorized contracting
officer, has to repair to another city just to have a deed notarized.

3. There is absolutely no record of the requisite public land application to purchase required under Section 89 of the Public Land Act.[56] There
is also no record of the deed of sale and of documents usually accompanying an application to purchase, inclusive of the investigation report
and the property valuation. The Certification under the seal of the LMB bearing date November 24, 1994 and issued/signed by Alberto
Recalde, OIC, Records Management Division of the LMB pursuant to a subpoena issued by the trial court[57] attest to this fact of absence of
records. Atty. Alice B. Dayrit, then Chief, Land Utilization and Disposition Division, LMB, testified having personally looked at the bureau
record book, but found no entry pertaining to SHAI.[58]

4. In its Answer as defendant a quo, respondent SHAI states that the deed of sale specifically meritorious Official Receipt No. 6030203C dated
29 October 1991, (sic) as evidence of full payment of the agreed purchase price.. An official receipt (O.R.) is doubtless the best evidence to
prove payment. While it kept referring to O.R. No. 6030203 as its evidence of the required payment, [59] it failed to present and offer the
receipt in evidence. A Certification under date September 15, 1993 of the OIC Cash Division, LMB, states that OR # 6030203 in the amount of
P11,977,000.00 supposedly paid by [SHAI] is not among the series of [ORs] issued at any time by the National Printing Office to the Cashier,
LMB, Central Office.[60] A copy of the OR receipt is not appended to any of the pleadings filed before the Court. We can thus validly presume
that no such OR exists or, if it does, that its presentation would be adverse to SHAI.
A contract of sale is void where the price, which appears in the document as paid has, in fact, never been paid.[61]

5. The purchase price was, according to the witnesses for SHAI, paid in full in cash to the cashier of the LMB the corresponding
amount apparently coming in a mix of P500 and P100denominations. Albeit plausible, SHAIs witnesses account taxes credulity to the limit.

A final consideration in G.R. No. 156951. This case could not have come to pass without the participation of a cabal of cheats out to make a

dishonest buck at the expense of the government and most likely the members of SHAI. No less than its former president (Ms. Virginia

Santos) testified that a facilitator did, for a fee, the necessary paper and leg work before the LMB and the Registry of Deeds that led to the

execution of the Deed of Sale and issuance of the certificate of title in question.[62] Ms. Santos identified Eugenia Balis, a geodetic engineer,

as the facilitator[63] who facilitated all these presentation of documents,[64] and most of the time, directly transacted with the LMB and the

Register of Deeds leading to acquisition of title.[65] Engr. Balis was, in the course of Ms. Santos testimony, directly mentioned by name for at

least fifteen (15) times. Not surprisingly, Engr. Balis did not appear in court, despite SHAIs stated intention to present her as witness.[66]

The extent of the misappropriation of the Fort Bonifacio land involved in this and the NOVA area litigations is, as described in the Report of

the FactFinding Commission,[67]so epic in scale as to make the overpricing of land complained of in the two hundred AFP [Retirement and

Separation Benefits System] RSBS cases (P703 million) seem like petty shoplifting in comparison.[68] The members of private respondent

SHAI may very well have paid for what they might have been led to believe as the purchase price of the JUSMAG housing area. The sad

reality, however, is that the over P11 Million they paid, if that be the case, for a piece of real estate contextually outside the commerce of

man apparently fell into the wrong hands and did not enter the government coffers. Else, there must be some memorials of such payment.

At bottom, this disposition is nothing more than restoring the petitioner Republic, and eventually the BCDA, to what rightfully belongs to it in

law and in fact. There is nothing unjust to this approach.

With the foregoing disquisitions, the petition for contempt in G.R. No. 173408 need not detain us long. As it were, the question raised by the

petitioners therein respecting the ownership of the JUSMAG area and, accordingly, of the right of the petitioning retired military officers to

remain in the housing units each may be occupying is now moot and academic. However, contempt petitioners expressed revulsion over the

efforts of the military establishment, particularly the AFP Chief of Staff, to oust them from their respective dwellings, if that really be the case,

even before G.R. No. 156951 could be resolved, is understandable as it is justified. We thus end this ponencia with a reminder to all and

sundry that might is not always right; that ours is still a government of laws and not of men, be they in the civilian or military sector.

Accordingly, the Court will not treat lightly any attempt to trifle, intended or otherwise, with its processes and proceedings. A becoming

respect to the majesty of the law and the prerogatives of the Court is a must for the orderly administration of justice to triumph.

WHEREFORE, the petition in G.R. No. 156951 is GRANTED and the appealed CA Decision is REVERSED and SET ASIDE.
Accordingly, the Deed of Sale dated October 30, 1991 (Exh. A/1) purportedly executed in favor of private respondent SHAI and TCT No.
15084 (Exh. B/2) of the Registry of Deeds of Rizal issued on the basis ofsuch deed are declared VOID. The Register of Deeds of Pasig
or Taguig, as the case may be, is hereby ordered to CANCEL TCT No. 15084 in the name of SHAI and the area covered thereby
is DECLARED part of the Fort Bonifacio Military Reservation, unless the same has, in the interim, been duly excluded by law or proclamation
from such reservation. Private respondent SHAI, its members, representatives and/or their assigns shall vacate the subject parcels of land
immediately upon the finality of this decision, subject to the provisions of Republic Act No. 7227, otherwise known as the Bases Conversion
and Development Act.

Cost against the private respondent SHAI. Having said our piece in G.R. No. 173408, we need not speak any further thereon other than to
deny as we hereby similarly DENY the same. SO ORDERED.
G.R. No. 92013 July 25, 1990

SALVADOR H. LAUREL, petitioner,

vs.
RAMON GARCIA, as head of the Asset Privatization Trust, RAUL MANGLAPUS, as Secretary of Foreign Affairs, and CATALINO
MACARAIG, as Executive Secretary, respondents.

G.R. No. 92047 July 25, 1990

DIONISIO S. OJEDA, petitioner,

vs.
EXECUTIVE SECRETARY MACARAIG, JR., ASSETS PRIVATIZATION TRUST CHAIRMAN RAMON T. GARCIA, AMBASSADOR RAMON
DEL ROSARIO, et al., as members of the PRINCIPAL AND BIDDING COMMITTEES ON THE UTILIZATION/DISPOSITION
PETITION OF PHILIPPINE GOVERNMENT PROPERTIES IN JAPAN, respondents.

Arturo M. Tolentino for petitioner in 92013.

GUTIERREZ, JR., J.:

These are two petitions for prohibition seeking to enjoin respondents, their representatives and agents from proceeding with the bidding for
the sale of the 3,179 square meters of land at 306 Roppongi, 5-Chome Minato-ku Tokyo, Japan scheduled on February 21, 1990. We granted
the prayer for a temporary restraining order effective February 20, 1990. One of the petitioners (in G.R. No. 92047) likewise prayes for a writ
of mandamus to compel the respondents to fully disclose to the public the basis of their decision to push through with the sale of the
Roppongi property inspire of strong public opposition and to explain the proceedings which effectively prevent the participation of Filipino
citizens and entities in the bidding process.

The oral arguments in G.R. No. 92013, Laurel v. Garcia, et al. were heard by the Court on March 13, 1990. After G.R. No. 92047, Ojeda v.
Secretary Macaraig, et al. was filed, the respondents were required to file a comment by the Court's resolution dated February 22, 1990. The
two petitions were consolidated on March 27, 1990 when the memoranda of the parties in the Laurel case were deliberated upon.

The Court could not act on these cases immediately because the respondents filed a motion for an extension of thirty (30) days to file
comment in G.R. No. 92047, followed by a second motion for an extension of another thirty (30) days which we granted on May 8, 1990, a
third motion for extension of time granted on May 24, 1990 and a fourth motion for extension of time which we granted on June 5, 1990 but
calling the attention of the respondents to the length of time the petitions have been pending. After the comment was filed, the petitioner in
G.R. No. 92047 asked for thirty (30) days to file a reply. We noted his motion and resolved to decide the two (2) cases.

The subject property in this case is one of the four (4) properties in Japan acquired by the Philippine government under the Reparations
Agreement entered into with Japan on May 9, 1956, the other lots being:

(1) The Nampeidai Property at 11-24 Nampeidai-machi, Shibuya-ku, Tokyo which has an area of approximately 2,489.96 square meters, and
is at present the site of the Philippine Embassy Chancery;

(2) The Kobe Commercial Property at 63 Naniwa-cho, Kobe, with an area of around 764.72 square meters and categorized as a commercial
lot now being used as a warehouse and parking lot for the consulate staff; and

(3) The Kobe Residential Property at 1-980-2 Obanoyama-cho, Shinohara, Nada-ku, Kobe, a residential lot which is now vacant.

The properties and the capital goods and services procured from the Japanese government for national development projects are part of the
indemnification to the Filipino people for their losses in life and property and their suffering during World War II.

The Reparations Agreement provides that reparations valued at $550 million would be payable in twenty (20) years in accordance with annual
schedules of procurements to be fixed by the Philippine and Japanese governments (Article 2, Reparations Agreement). Rep. Act No. 1789,
the Reparations Law, prescribes the national policy on procurement and utilization of reparations and development loans. The procurements
are divided into those for use by the government sector and those for private parties in projects as the then National Economic Council shall
determine. Those intended for the private sector shall be made available by sale to Filipino citizens or to one hundred (100%) percent
Filipino-owned entities in national development projects.

The Roppongi property was acquired from the Japanese government under the Second Year Schedule and listed under the heading
"Government Sector", through Reparations Contract No. 300 dated June 27, 1958. The Roppongi property consists of the land and building
"for the Chancery of the Philippine Embassy" (Annex M-D to Memorandum for Petitioner, p. 503). As intended, it became the site of the
Philippine Embassy until the latter was transferred to Nampeidai on July 22, 1976 when the Roppongi building needed major repairs. Due to
the failure of our government to provide necessary funds, the Roppongi property has remained undeveloped since that time.

A proposal was presented to President Corazon C. Aquino by former Philippine Ambassador to Japan, Carlos J. Valdez, to make the property
the subject of a lease agreement with a Japanese firm - Kajima Corporation — which shall construct two (2) buildings in Roppongi and one (1)
building in Nampeidai and renovate the present Philippine Chancery in Nampeidai. The consideration of the construction would be the lease to
the foreign corporation of one (1) of the buildings to be constructed in Roppongi and the two (2) buildings in Nampeidai. The other building in
Roppongi shall then be used as the Philippine Embassy Chancery. At the end of the lease period, all the three leased buildings shall be
occupied and used by the Philippine government. No change of ownership or title shall occur. (See Annex "B" to Reply to Comment) The
Philippine government retains the title all throughout the lease period and thereafter. However, the government has not acted favorably on
this proposal which is pending approval and ratification between the parties. Instead, on August 11, 1986, President Aquino created a
committee to study the disposition/utilization of Philippine government properties in Tokyo and Kobe, Japan through Administrative Order No.
3, followed by Administrative Orders Numbered 3-A, B, C and D.

On July 25, 1987, the President issued Executive Order No. 296 entitling non-Filipino citizens or entities to avail of separations' capital goods
and services in the event of sale, lease or disposition. The four properties in Japan including the Roppongi were specifically mentioned in the
first "Whereas" clause.

Amidst opposition by various sectors, the Executive branch of the government has been pushing, with great vigor, its decision to sell the
reparations properties starting with the Roppongi lot. The property has twice been set for bidding at a minimum floor price of $225 million.
The first bidding was a failure since only one bidder qualified. The second one, after postponements, has not yet materialized. The last
scheduled bidding on February 21, 1990 was restrained by his Court. Later, the rules on bidding were changed such that the $225 million
floor price became merely a suggested floor price.
The Court finds that each of the herein petitions raises distinct issues. The petitioner in G.R. No. 92013 objects to the alienation of the
Roppongi property to anyone while the petitioner in G.R. No. 92047 adds as a principal objection the alleged unjustified bias of the Philippine
government in favor of selling the property to non-Filipino citizens and entities. These petitions have been consolidated and are resolved at
the same time for the objective is the same - to stop the sale of the Roppongi property.

The petitioner in G.R. No. 92013 raises the following issues:

(1) Can the Roppongi property and others of its kind be alienated by the Philippine Government?; and

(2) Does the Chief Executive, her officers and agents, have the authority and jurisdiction, to sell the Roppongi property?

Petitioner Dionisio Ojeda in G.R. No. 92047, apart from questioning the authority of the government to alienate the Roppongi property assails
the constitutionality of Executive Order No. 296 in making the property available for sale to non-Filipino citizens and entities. He also
questions the bidding procedures of the Committee on the Utilization or Disposition of Philippine Government Properties in Japan for being
discriminatory against Filipino citizens and Filipino-owned entities by denying them the right to be informed about the bidding requirements.

II

In G.R. No. 92013, petitioner Laurel asserts that the Roppongi property and the related lots were acquired as part of the reparations from the
Japanese government for diplomatic and consular use by the Philippine government. Vice-President Laurel states that the Roppongi property
is classified as one of public dominion, and not of private ownership under Article 420 of the Civil Code (See infra).

The petitioner submits that the Roppongi property comes under "property intended for public service" in paragraph 2 of the above provision.
He states that being one of public dominion, no ownership by any one can attach to it, not even by the State. The Roppongi and related
properties were acquired for "sites for chancery, diplomatic, and consular quarters, buildings and other improvements" (Second Year
Reparations Schedule). The petitioner states that they continue to be intended for a necessary service. They are held by the State in
anticipation of an opportune use. (Citing 3 Manresa 65-66). Hence, it cannot be appropriated, is outside the commerce of man, or to put it in
more simple terms, it cannot be alienated nor be the subject matter of contracts (Citing Municipality of Cavite v. Rojas, 30 Phil. 20 [1915]).
Noting the non-use of the Roppongi property at the moment, the petitioner avers that the same remains property of public dominion so long
as the government has not used it for other purposes nor adopted any measure constituting a removal of its original purpose or use.

The respondents, for their part, refute the petitioner's contention by saying that the subject property is not governed by our Civil Code but by
the laws of Japan where the property is located. They rely upon the rule of lex situs which is used in determining the applicable law regarding
the acquisition, transfer and devolution of the title to a property. They also invoke Opinion No. 21, Series of 1988, dated January 27, 1988 of
the Secretary of Justice which used the lex situs in explaining the inapplicability of Philippine law regarding a property situated in Japan.

The respondents add that even assuming for the sake of argument that the Civil Code is applicable, the Roppongi property has ceased to
become property of public dominion. It has become patrimonial property because it has not been used for public service or for diplomatic
purposes for over thirteen (13) years now (Citing Article 422, Civil Code) and because the intention by the Executive Department and the
Congress to convert it to private use has been manifested by overt acts, such as, among others: (1) the transfer of the Philippine Embassy to
Nampeidai (2) the issuance of administrative orders for the possibility of alienating the four government properties in Japan; (3) the issuance
of Executive Order No. 296; (4) the enactment by the Congress of Rep. Act No. 6657 [the Comprehensive Agrarian Reform Law] on June 10,
1988 which contains a provision stating that funds may be taken from the sale of Philippine properties in foreign countries; (5) the holding of
the public bidding of the Roppongi property but which failed; (6) the deferment by the Senate in Resolution No. 55 of the bidding to a future
date; thus an acknowledgment by the Senate of the government's intention to remove the Roppongi property from the public service
purpose; and (7) the resolution of this Court dismissing the petition in Ojeda v. Bidding Committee, et al., G.R. No. 87478 which sought to
enjoin the second bidding of the Roppongi property scheduled on March 30, 1989.

III

In G.R. No. 94047, petitioner Ojeda once more asks this Court to rule on the constitutionality of Executive Order No. 296. He had earlier filed
a petition in G.R. No. 87478 which the Court dismissed on August 1, 1989. He now avers that the executive order contravenes the
constitutional mandate to conserve and develop the national patrimony stated in the Preamble of the 1987 Constitution. It also allegedly
violates:

(1) The reservation of the ownership and acquisition of alienable lands of the public domain to Filipino citizens. (Sections 2 and 3, Article XII,
Constitution; Sections 22 and 23 of Commonwealth Act 141).i•t•c-aüsl

(2) The preference for Filipino citizens in the grant of rights, privileges and concessions covering the national economy and patrimony
(Section 10, Article VI, Constitution);

(3) The protection given to Filipino enterprises against unfair competition and trade practices;

(4) The guarantee of the right of the people to information on all matters of public concern (Section 7, Article III, Constitution);

(5) The prohibition against the sale to non-Filipino citizens or entities not wholly owned by Filipino citizens of capital goods received by the
Philippines under the Reparations Act (Sections 2 and 12 of Rep. Act No. 1789); and

(6) The declaration of the state policy of full public disclosure of all transactions involving public interest (Section 28, Article III, Constitution).

Petitioner Ojeda warns that the use of public funds in the execution of an unconstitutional executive order is a misapplication of public funds
He states that since the details of the bidding for the Roppongi property were never publicly disclosed until February 15, 1990 (or a few days
before the scheduled bidding), the bidding guidelines are available only in Tokyo, and the accomplishment of requirements and the selection
of qualified bidders should be done in Tokyo, interested Filipino citizens or entities owned by them did not have the chance to comply with
Purchase Offer Requirements on the Roppongi. Worse, the Roppongi shall be sold for a minimum price of $225 million from which price capital
gains tax under Japanese law of about 50 to 70% of the floor price would still be deducted.

IV

The petitioners and respondents in both cases do not dispute the fact that the Roppongi site and the three related properties were through
reparations agreements, that these were assigned to the government sector and that the Roppongi property itself was specifically designated
under the Reparations Agreement to house the Philippine Embassy.

The nature of the Roppongi lot as property for public service is expressly spelled out. It is dictated by the terms of the Reparations Agreement
and the corresponding contract of procurement which bind both the Philippine government and the Japanese government.
There can be no doubt that it is of public dominion unless it is convincingly shown that the property has become patrimonial. This, the
respondents have failed to do.

As property of public dominion, the Roppongi lot is outside the commerce of man. It cannot be alienated. Its ownership is a special collective
ownership for general use and enjoyment, an application to the satisfaction of collective needs, and resides in the social group. The purpose is
not to serve the State as a juridical person, but the citizens; it is intended for the common and public welfare and cannot be the object of
appropration. (Taken from 3 Manresa, 66-69; cited in Tolentino, Commentaries on the Civil Code of the Philippines, 1963 Edition, Vol. II, p.
26).

The applicable provisions of the Civil Code are:

ART. 419. Property is either of public dominion or of private ownership.

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.

The Roppongi property is correctly classified under paragraph 2 of Article 420 of the Civil Code as property belonging to the State and
intended for some public service.

Has the intention of the government regarding the use of the property been changed because the lot has been Idle for some years? Has it
become patrimonial?

The fact that the Roppongi site has not been used for a long time for actual Embassy service does not automatically convert it to patrimonial
property. Any such conversion happens only if the property is withdrawn from public use (Cebu Oxygen and Acetylene Co. v. Bercilles, 66
SCRA 481 [1975]). A property continues to be part of the public domain, not available for private appropriation or ownership until there is a
formal declaration on the part of the government to withdraw it from being such (Ignacio v. Director of Lands, 108 Phil. 335 [1960]).

The respondents enumerate various pronouncements by concerned public officials insinuating a change of intention. We emphasize, however,
that an abandonment of the intention to use the Roppongi property for public service and to make it patrimonial property under Article 422 of
the Civil Code must be definite Abandonment cannot be inferred from the non-use alone specially if the non-use was attributable not to the
government's own deliberate and indubitable will but to a lack of financial support to repair and improve the property (See Heirs of Felino
Santiago v. Lazaro, 166 SCRA 368 [1988]). Abandonment must be a certain and positive act based on correct legal premises.

A mere transfer of the Philippine Embassy to Nampeidai in 1976 is not relinquishment of the Roppongi property's original purpose. Even the
failure by the government to repair the building in Roppongi is not abandonment since as earlier stated, there simply was a shortage of
government funds. The recent Administrative Orders authorizing a study of the status and conditions of government properties in Japan were
merely directives for investigation but did not in any way signify a clear intention to dispose of the properties.

Executive Order No. 296, though its title declares an "authority to sell", does not have a provision in its text expressly authorizing the sale of
the four properties procured from Japan for the government sector. The executive order does not declare that the properties lost their public
character. It merely intends to make the properties available to foreigners and not to Filipinos alone in case of a sale, lease or other
disposition. It merely eliminates the restriction under Rep. Act No. 1789 that reparations goods may be sold only to Filipino citizens and one
hundred (100%) percent Filipino-owned entities. The text of Executive Order No. 296 provides:

Section 1. The provisions of Republic Act No. 1789, as amended, and of other laws to the contrary notwithstanding, the
above-mentioned properties can be made available for sale, lease or any other manner of disposition to non-Filipino
citizens or to entities owned by non-Filipino citizens.

Executive Order No. 296 is based on the wrong premise or assumption that the Roppongi and the three other properties were earlier
converted into alienable real properties. As earlier stated, Rep. Act No. 1789 differentiates the procurements for the government sector and
the private sector (Sections 2 and 12, Rep. Act No. 1789). Only the private sector properties can be sold to end-users who must be Filipinos
or entities owned by Filipinos. It is this nationality provision which was amended by Executive Order No. 296.

Section 63 (c) of Rep. Act No. 6657 (the CARP Law) which provides as one of the sources of funds for its implementation, the proceeds of the
disposition of the properties of the Government in foreign countries, did not withdraw the Roppongi property from being classified as one of
public dominion when it mentions Philippine properties abroad. Section 63 (c) refers to properties which are alienable and not to those
reserved for public use or service. Rep Act No. 6657, therefore, does not authorize the Executive Department to sell the Roppongi property. It
merely enumerates possible sources of future funding to augment (as and when needed) the Agrarian Reform Fund created under Executive
Order No. 299. Obviously any property outside of the commerce of man cannot be tapped as a source of funds.

The respondents try to get around the public dominion character of the Roppongi property by insisting that Japanese law and not our Civil
Code should apply.

It is exceedingly strange why our top government officials, of all people, should be the ones to insist that in the sale of extremely valuable
government property, Japanese law and not Philippine law should prevail. The Japanese law - its coverage and effects, when enacted, and
exceptions to its provision — is not presented to the Court It is simply asserted that the lex loci rei sitae or Japanese law should apply without
stating what that law provides. It is a ed on faith that Japanese law would allow the sale.

We see no reason why a conflict of law rule should apply when no conflict of law situation exists. A conflict of law situation arises only when:
(1) There is a dispute over the title or ownership of an immovable, such that the capacity to take and transfer immovables, the formalities of
conveyance, the essential validity and effect of the transfer, or the interpretation and effect of a conveyance, are to be determined (See
Salonga, Private International Law, 1981 ed., pp. 377-383); and (2) A foreign law on land ownership and its conveyance is asserted to
conflict with a domestic law on the same matters. Hence, the need to determine which law should apply.

In the instant case, none of the above elements exists.

The issues are not concerned with validity of ownership or title. There is no question that the property belongs to the Philippines. The issue is
the authority of the respondent officials to validly dispose of property belonging to the State. And the validity of the procedures adopted to
effect its sale. This is governed by Philippine Law. The rule of lex situs does not apply.

The assertion that the opinion of the Secretary of Justice sheds light on the relevance of the lex situsrule is misplaced. The opinion does not
tackle the alienability of the real properties procured through reparations nor the existence in what body of the authority to sell them. In
discussing who are capableof acquiring the lots, the Secretary merely explains that it is the foreign law which should determine who can
acquire the properties so that the constitutional limitation on acquisition of lands of the public domain to Filipino citizens and entities wholly
owned by Filipinos is inapplicable. We see no point in belaboring whether or not this opinion is correct. Why should we discuss who can
acquire the Roppongi lot when there is no showing that it can be sold?

The subsequent approval on October 4, 1988 by President Aquino of the recommendation by the investigating committee to sell the Roppongi
property was premature or, at the very least, conditioned on a valid change in the public character of the Roppongi property. Moreover, the
approval does not have the force and effect of law since the President already lost her legislative powers. The Congress had already convened
for more than a year.

Assuming for the sake of argument, however, that the Roppongi property is no longer of public dominion, there is another obstacle to its sale
by the respondents.

There is no law authorizing its conveyance.

Section 79 (f) of the Revised Administrative Code of 1917 provides

Section 79 (f ) Conveyances and contracts to which the Government is a party. — In cases in which the Government of the
Republic of the Philippines is a party to any deed or other instrument conveying the title to real estate or to any other
property the value of which is in excess of one hundred thousand pesos, the respective Department Secretary shall
prepare the necessary papers which, together with the proper recommendations, shall be submitted to the Congress of the
Philippines for approval by the same. Such deed, instrument, or contract shall be executed and signed by the President of
the Philippines on behalf of the Government of the Philippines unless the Government of the Philippines unless the
authority therefor be expressly vested by law in another officer. (Emphasis supplied)

The requirement has been retained in Section 48, Book I of the Administrative Code of 1987 (Executive Order No. 292).

SEC. 48. Official Authorized to Convey Real Property. — Whenever real property of the Government is authorized by law to
be conveyed, the deed of conveyance shall be executed in behalf of the government by the following:

(1) For property belonging to and titled in the name of the Republic of the Philippines, by the President, unless the
authority therefor is expressly vested by law in another officer.

(2) For property belonging to the Republic of the Philippines but titled in the name of any political subdivision or of any
corporate agency or instrumentality, by the executive head of the agency or instrumentality. (Emphasis supplied)

It is not for the President to convey valuable real property of the government on his or her own sole will. Any such conveyance must be
authorized and approved by a law enacted by the Congress. It requires executive and legislative concurrence.

Resolution No. 55 of the Senate dated June 8, 1989, asking for the deferment of the sale of the Roppongi property does not withdraw the
property from public domain much less authorize its sale. It is a mere resolution; it is not a formal declaration abandoning the public
character of the Roppongi property. In fact, the Senate Committee on Foreign Relations is conducting hearings on Senate Resolution No. 734
which raises serious policy considerations and calls for a fact-finding investigation of the circumstances behind the decision to sell the
Philippine government properties in Japan.

The resolution of this Court in Ojeda v. Bidding Committee, et al., supra, did not pass upon the constitutionality of Executive Order No. 296.
Contrary to respondents' assertion, we did not uphold the authority of the President to sell the Roppongi property. The Court stated that the
constitutionality of the executive order was not the real issue and that resolving the constitutional question was "neither necessary nor finally
determinative of the case." The Court noted that "[W]hat petitioner ultimately questions is the use of the proceeds of the disposition of the
Roppongi property." In emphasizing that "the decision of the Executive to dispose of the Roppongi property to finance the CARP ... cannot be
questioned" in view of Section 63 (c) of Rep. Act No. 6657, the Court did not acknowledge the fact that the property became alienable nor did
it indicate that the President was authorized to dispose of the Roppongi property. The resolution should be read to mean that in case the
Roppongi property is re-classified to be patrimonial and alienable by authority of law, the proceeds of a sale may be used for national
economic development projects including the CARP.

Moreover, the sale in 1989 did not materialize. The petitions before us question the proposed 1990 sale of the Roppongi property. We are
resolving the issues raised in these petitions, not the issues raised in 1989.

Having declared a need for a law or formal declaration to withdraw the Roppongi property from public domain to make it alienable and a need
for legislative authority to allow the sale of the property, we see no compelling reason to tackle the constitutional issues raised by petitioner
Ojeda.

The Court does not ordinarily pass upon constitutional questions unless these questions are properly raised in appropriate cases and their
resolution is necessary for the determination of the case (People v. Vera, 65 Phil. 56 [1937]). The Court will not pass upon a constitutional
question although properly presented by the record if the case can be disposed of on some other ground such as the application of a statute
or general law (Siler v. Louisville and Nashville R. Co., 213 U.S. 175, [1909], Railroad Commission v. Pullman Co., 312 U.S. 496 [1941]).

The petitioner in G.R. No. 92013 states why the Roppongi property should not be sold:

The Roppongi property is not just like any piece of property. It was given to the Filipino people in reparation for the lives
and blood of Filipinos who died and suffered during the Japanese military occupation, for the suffering of widows and
orphans who lost their loved ones and kindred, for the homes and other properties lost by countless Filipinos during the
war. The Tokyo properties are a monument to the bravery and sacrifice of the Filipino people in the face of an invader; like
the monuments of Rizal, Quezon, and other Filipino heroes, we do not expect economic or financial benefits from them.
But who would think of selling these monuments? Filipino honor and national dignity dictate that we keep our properties in
Japan as memorials to the countless Filipinos who died and suffered. Even if we should become paupers we should not
think of selling them. For it would be as if we sold the lives and blood and tears of our countrymen. (Rollo- G.R. No.
92013, p.147)

The petitioner in G.R. No. 92047 also states:

 Roppongi is no ordinary property. It is one ceded by the Japanese government in atonement for its past belligerence for
the valiant sacrifice of life and limb and for deaths, physical dislocation and economic devastation the whole Filipino people
endured in World War II.

It is for what it stands for, and for what it could never bring back to life, that its significance today remains undimmed,
inspire of the lapse of 45 years since the war ended, inspire of the passage of 32 years since the property passed on to the
Philippine government.

Roppongi is a reminder that cannot — should not — be dissipated ... (Rollo-92047, p. 9)

It is indeed true that the Roppongi property is valuable not so much because of the inflated prices fetched by real property in Tokyo but more
so because of its symbolic value to all Filipinos — veterans and civilians alike. Whether or not the Roppongi and related properties will
eventually be sold is a policy determination where both the President and Congress must concur. Considering the properties' importance and
value, the laws on conversion and disposition of property of public dominion must be faithfully followed.

WHEREFORE, IN VIEW OF THE FOREGOING, the petitions are GRANTED. A writ of prohibition is issued enjoining the respondents from
proceeding with the sale of the Roppongi property in Tokyo, Japan. The February 20, 1990 Temporary Restraining Order is made
PERMANENT. SO ORDERED.
G.R. No. L-65334 December 26, 1984

MUNICIPALITY OF ANTIPOLO, petitioner,

vs.
AQUILINA ZAPANTA, ISIDRO DELA CRUZ, ELIAS DELA CRUZ, MARIA DELA CRUZ, MODESTA LEYVA, FERMIN LEYVA, SUSANA
LEYVA, MARCIAL LEYVA, FELISA LEYVA, ISIDORA LEYVA, HONORIO LEYVA, CONCORDIA GALICIA, APOLONIA AVENDANO,
AMPARO AVENDANO, FIDELA SARTE, BEATRIZ SARTE, VICTORIO SARTE, VIRGINIA SARTE, JULIANA SARTE, RODOLFO SARTE,
BENITA SARTE, ANTONINA SUAREZ, DANIEL SUAREZ, BEATA SUAREZ, ENRIQUE AVENDANO, PAULINO AVENDANO, SAMSON
LAVILLA, SR., AURELIA LAPAR, VIRGILIO HILARIO, NATIVIDAD MARQUEZ, LUISITO LOPEZ, REMEDIOS LOPEZ, ROMEO LOPEZ,
NATIVIDAD LOPEZ and the HONORABLE INTERMEDIATE APPELLATE COURT,respondents.

Mariano A.G. Cervo for petitioner.

Leonardo C. Rodriguez for respondents.

MELENCIO-HERRERA, J.:

In this appeal by Certiorari, we called upon to review the Resolution of respondent Intermediate Appellate Court, dated August 23, 1983.
Dismissing petitioner's appeal for failure to file its brief within the reglementary period, and the subsequent Resolution of the same Court,
dated September 27, 1983, denying petitioner's Motion for Reconsideration for being without any legal and factual basis.

The facts may be briefly stated as follows: On August 8, 1977, a single application for the registration of two distinct parcels of land was filed
by two distinct applicants before the then Court of First Instance of Rizal, Branch XV, Makati (the Registration Court, for short). One of the
two applicants was Conrado Eniceo. He had applied for registration under the Torrens system of a parcel of land containing 258 square
meters. The other applicant was "Heirs of Joaquin Avendaño", and the land they were applying for registration was a parcel (hereinafter called
the DISPUTED PROPERTY) containing 9,826 square meters surveyed in the name of the Municipality of Antipolo (ANTIPOLO, for short). Both
parcels were situated in the Municipality of Antipolo. The applications were approved by the Registration Court on February 26, 1980.
ANTIPOLO took steps to interpose an appeal but because it failed to amend the Record on Appeal, its appeal was disallowed.

On May 22, 1981, ANTIPOLO filed a complaint in Civil Case No. 41353, also of the Court of First Instance of Rizal, Branch XIII, Pasig (the
CASE BELOW, for short) against named "Heirs of Joaquin Avendaño", and their assignees (hereinafter called the AVENDAÑO HEIRS) praying
for nullification of the judgment rendered by the Registration Court. The defendants, in their Answer, pleaded a special defense of res
judicata, After a preliminary hearing on the mentioned special defense, the CASE BELOW was dismissed. ANTIPOLO perfected an appeal to
the then Court of Appeals.

A notice to file Brief was issued by the Appellate Court, which ANTIPOLO claimed it had not received. Upon motion of the defendants-
appellees to dismiss on the ground that ANTIPOLO had not filed its Brief within the reglementary period, the appeal was dismissed despite the
fact that before the dismissal, ANTIPOLO had submitted its Appellant's Brief.

We gave due course to the Petition for Review on certiorari filed with this Court by ANTIPOLO, and the latter had restated the issues as
follow:

The Intermediate Appellate Court erred in dismissing petitioner's appeal on the alleged ground of failure to file appellant's
brief within the reglementary period the fact being that counsel had not been duly served with the notice to file brief.

II

At any rate, the Appellate Court should have given due course to the appeal since the appellant's brief was filed within the
90-day period which is uniformly granted as a matter of course to all litigants before the Appellate Court, instead of
dismissing the appeal on a technicality.

III

With more reason should petitioner's appeal have been given due course on the important and substantial allegation that
the registration court did not have jurisdiction over the land subject of registration, it being property of the Municipality of
Antipolo, used long before the war as a public market and other public purposes, and hence actually devoted to public use
and service.

Only a short resolution need be made to sustain the first and second issues of error. Although failure to file Brief within the time provided by
the Rules is, indeed, a ground for dismissal of an appeal, this Court had held that rules of technicality must yield to the broader interests of
substantial justice 1 specially where, as in this case, the important issue of lack of jurisdiction over the subject matter of the Land
Registration Court has been raised.

With the foregoing conclusion, a remand to respondent Court, for the entertainment of the appeal on the merits, would ordinarily be the
appropriate relief. However, considering the three Motions for Early Decision filed by private respondents, we shall resolve the substantive
merits of the appeal to the appellate tribunal from the judgment rendered in the CASE BELOW.

From the record, we have gathered that ANTIPOLO, for more than 50 years now, has considered the DISPUTED PROPERTY to be public land
subject to ANTI POLO's use and permission to use within the prerogatives and purposes of a municipal corporation. There is indication to the
effect that it had been the site of the public market as far back as 1908, 2 or at the latest, since 1920 "up to today." 3 Gradually, additional
public structures were built thereon, like the Puericulture and Family Planning Center, the Integrated National Police Building, the Office of the
Municipal Treasurer, and the public abattoir. Those public structures occupy almost the entire area of the land. At the time the application for
registration was filed on August 8, 1977, the DISPUTED PROPERTY was already devoted to public use and public service. Therefore, it was
outside the commerce of man and could no longer be subject to private registration.

The claim of the AVENDAÑO HEIRS that they merely tolerated occupancy by ANTIPOLO which had borrowed the DISPUTED PROPERTY from
them, since they had been in possession, since as far back as 1916, erroneously presupposes ownership thereof since that time. They forget
that all lands are presumed to be public lands until the contrary is established. 4 The fact that the DISPUTED PROPERTY may have been
declared for taxation purposes in their names or of their predecessors-in-interest as early as 1918 5 does not necessarily prove ownership.
They are merely indicia of a claim of ownership. 6 ANTIPOLO had also declared the DISPUTED PROPERTY as its own in Tax Declarations Nos.
909, 993 and 454.
Since the Land Registration Court had no jurisdiction to entertain the application for registration of public property of ANTIPOLO, its Decision
adjudicating the DISPUTED PROPERTY as of private ownership is null and void. It never attained finality, and can be attacked at any time. It
was not a bar to the action brought by ANTIPOLO for its annulment by reason of res judicata.

* * * the want of jurisdiction by a court over the subject-matter renders the judgment void and a mere nullity, and
considering that a void judgment is in legal effect no judgment, by which no rights are divested, from which no rights can
be obtained, which neither binds nor bars any one, and under which all acts performed and all claims flowing out of are
void, and considering, further, that the decision, for want of jurisdiction of the court, is not a decision in contemplation of
law, and hence, can never become executory, it follows that such a void judgment cannot constitute a bar to another case
by reason of res judicata. 7

It follows that the titles issued in favor of the AVENDAÑO HEIRS must also be held to be null and void. They were issued by a Court with no
jurisdiction over the subject matter. Perforce, they must be ordered cancelled.

...It follows that "if a person obtains a title under the Public Land Act which includes, by oversight, lands which cannot be
registered under the Torrens System, or when the Director of Lands did not have jurisdiction over the same because it is a
public forest, the grantee does not, by virtue of the said certificate of title alone, become the owner of the land illegally
included" (Republic vs. Animas,56 SCRA 499, 503; Ledesma vs. Municipality of Iloilo, 49 Phil. 769).

xxx xxx xxx

Under these circumstances, the certificate of title may be ordered cancelled (Republic vs. Animas, et al., supra), and the
cancellation may be pursued through an ordinary action therefor. This action cannot be barred by the prior judgment of
the land registration court, since the said court had no jurisdiction over the subject matter. And if there was no such
jurisdiction, then the principle of res judicata does not apply. * * *. Certainly, one of the essential requisites, i.e.,
jurisdiction over the subject matter is absent in this case. 8 (Emphasis supplied).

WHEREFORE, judgment is hereby rendered as follows:

(1) The Resolutions of respondent Court, now the Intermediate Appellate Court, dated August 23, 1983 and September 27, 1983, are hereby
set aside, with this Court acting directly on the appeal of the Municipality of Antipolo from the judgment rendered by the then Court of First
Instance of Rizal, Branch XIII, in its Civil Case No. 41353;

(2) The aforesaid judgment of the then Court of First Instance of Rizal, Branch XIII, in Civil Case No. 41353 is set aside; and, instead, the
judgment and decree rendered by the then Court of First Instance of Rizal, Branch XV, in Land Registration Case No. N-9995, LRC Rec. No. N-
52176, is hereby declared null and void in respect of the "Heirs of Joaquin Avendaño";

(3) The Register of Deeds of Rizal is hereby ordered to cancel all certificates of title issued/transferred by virtue of the said judgment and
decree issued in the mentioned Land Registration Case No. N-9995; LRC Rec. No. N-52176 in respect of the "Heirs of Isabela Avendaño";

(4) The certificate of title issued in the name of Conrado Eniceo and transfers therefrom, by virtue of the judgment and decree in the
mentioned Land Registration Case No. N-9995; LRC Rec. No. N-52176, for practical purposes, shall continue to be valid.

Without pronouncement as to costs. SO ORDERED.

G.R. No. L-37682 March 29, 1974

REPUBLIC OF THE PHILIPPINES, Represented by the DIRECTOR OF LANDS, petitioner,

vs.
HON. PEDRO SAMSON ANIMAS, in his capacity as Judge of CFI South Cotabato, Branch I, General Santos City, ISAGANI DU
TIMBOL and the REGISTER OF DEEDS OF GENERAL SANTOS CITY, respondent.

Office of the Solicitor General Estelito P. Mendoza, Assistant Solicitor General Santiago M. Kapunan and Solicitor Patricio M. Patajo for
petitioner.

Quitain Law Office for private respondent.

ESGUERRA, J.:

Petition to review the order of the Court of First Instance of South Cotabato, Branch I, General Santos City, dated June 22, 1973, dismissing
the complaint in its Civil Case No. 1253, entitled "Republic of the Philippines, Plaintiff, vs. Isagani Du Timbol and the Register of Deeds of
General Santos City, Defendants", instituted by the plaintiff to declare null and void Free Patent No. V-466102 and Original Certificate of Title
(O.C.T.) No. P-2508 based thereon issued in the name of defendant Isagani Du Timbol; to order the aforesaid defendant to surrender the
owner's duplicate of O.C.T. No. P-2508 and the defendant Register of Deeds to cancel the same; to decree the reversion of the land in
question to the mass of public domain, and granting such further relief as may be just and equitable in the premises.

The land covered by the free patent and title in question was originally applied for by Precila Soria, who on February 23, 1966, transferred her
rights to the land and its improvements to defendant Isagani Du Timbol who filed his application therefor on February 3, 1969, as a
transferee from Precila Soria.

On December 12, 1969, free Patent No. V-466102 was issued by the President of the Philippines for the land in question, and on July 20,
1970, after transmittal of the patent to the Register of Deeds of General Santos City, Original Certificate of Title (O.C.T.) No. P-2508 was
issued in the name of defendant Isagani Du Timbol.

On August 5, 1971, the Republic of the Philippines, at the instance of the Bureau of Forestry, filed a complaint in the Court of First Instance of
Cotabato, Branch I, General Santos City (Civil Case No. 1253), to declare free patent No. V-466102 and Original Certificate of Title No. P-
2508 in the name of defendant Isagani Du Timbol null and void ab initio and to order the reversion of the land in question to the mass of
public domain. The action is based on the ground that the land covered thereby is a forest or timber land which is not disposable under the
Public Land Act; that in a reclassification of the public lands in the vicinity where the land in question is situated made by the Bureau of
Forestry on March 7, 1958, the said land was plotted on Bureau of Forestry map L.C. 700 to be inside the area which was reverted to the
category of public forest, whereas the application for free patent by Isagani Du Timbol was filed on June 3, 1969, or more than eleven years
thereafter; that the said patent and title were obtained fraudulently as private respondent Isagani Du Timbol never occupied and cultivated
the land applied for.

Invoking the case of Ramirez vs. Court of Appeals (G.R. No. L-28591, 30 SCRA 207-301), holding that a certificate of title fraudulently
secured is not null and void ab initio, unless the fraud consisted in misrepresenting that the land covered by the application is part of the
public domain when it is not, the respondent court dismissed the complaint on the ground that Certificate of Title based on the patent had
became indefeasible in view of the lapse of the one-year period prescribed under Section 38 of the Land Registration Act for review of a
decree of title on the ground of fraud. From this order of June 22, 1973, dismissing the complaint, plaintiff Republic of the Philippines has
appealed to this Court for review.

After careful deliberation, this Court grants the petition on the ground that the area covered by the patent and title is not disposable public
land, it being a part of the forest zone and, hence the patent and title thereto are null and void.

The defense of indefeasibility of a certificate of title issued pursuant to a free patent does not lie against the state in an action for reversion of
the land covered thereby when such land is a part of a public forest or of a forest reservation. As a general rule, timber or forest lands are not
alienable or disposable under either the Constitution of 1935 or the Constitution of 1973. Although the Director of Lands has jurisdiction over
public lands classified as agricultural under the constitution, or alienable or disposable under the Public Land Act, and is charged with the
administration of all laws relative thereto, mineral and timber lands are beyond his jurisdiction. It is the Bureau of Forestry that has
jurisdiction and authority over the demarcation, protection, management, reproduction, occupancy and use of all public forests and forest
reservations and over the granting of licenses for the taking of products therefrom, including stone and earth (Section 1816 of the Revised
Administrative Code). That the area in question is a forest or timber land is clearly established by the certification made by the Bureau of
Forest Development that it is within the portion of the area which was reverted to the category of forest land, approved by the President on
March 7, 1958. When the defendant Isagani Du Timbol filed his application for free patent over the land in question on June 3, 1969, the area
in question was not a disposable or alienable public land but a public forest. Titles issued to private parties by the Bureau of Lands when the
land covered thereby is not disposable public land but forest land are void ab initio. In Gatchalian vs. Pavilen, et al., L-17619, Oct. 31, 1962,
6 SCRA p. 508, 512, this Court said:

And if it be true that the Bureau of Lands had no jurisdiction to issue a patent because the land involved was still
inalienable forest land when granted, then it may be plausibly contended that the patent title would be ab initio void,
subject to attack at any time by any party adversely affected. (Gatchalian vs. Pavilen, et al., L-17619, Oct. 31,
1962, supra, citing Civil Code Arts. 1409 and 1421; Vaño vs. Insular Gov't., 41 Phil. 161; Aderable vs. Director of Forestry,
L-13663, March 25, 1960).

A patent is void at law if the officer who issued the patent had no authority to do so (Knight vs. Land Ass., 142 U.S. 161, 12 Sup. Ct., 258,
35L ED. 974; emphasis supplied). If a person obtains a title under the Public Land Act which includes, by mistake or oversight, lands which
cannot be registered under the Torrens System, or when the Director of Lands did not have jurisdiction over the same because it is a public
forest, the grantee does not, by virtue of said certificate of title alone, become the owner of the land illegally included. (See Ledesma vs.
Municipality of Iloilo, 49 Phil. 769)

The case of Ramirez vs. Court of Appeals, G. R. No. L-28591, Oct. 31, 1969, 30 SCRA 297, relied upon by respondent Court in dismissing this
case, is not controlling. In that case no forest land was involved but agricultural public land which was first covered by a patent issued to one
party and later registered under the Torrens System by the other party. The litigation was between private parties where the party who
registered it under Act No. 496 sought the nullity of the title of the patentee under the Public Land Act. In the case at bar the party seeking
the nullity of the title and reversion of the land is the state itself which is specifically authorized under Section 101 of the Public Land Act to
initiate such proceedings as an attribute of sovereignty, a remedy not available to a private individual.

The complaint alleges in its paragraph 8 that applicant Isagani Du Timbol was never in possession of the property prior to his filing the
application, contrary to the provisions of law that the applicant must have been in possession or cultivation thereof for at least 30 years; that
the applicant, after diligent search by the Acting Chief of the Survey-Party, Francisco R. Alcones, in South Cotabato, could not be contacted
because he is a resident of Davao City; that there are no existing signs of improvements found in the area in question as it is not under
cultivation but covered with grasses, bushes and small trees; that it is being used as ranch for grazing cows by the heirs of Hermogenes
Chilsot; that no monuments were placed on the area surveyed which goes to show that there was no actual survey thereof; that the property
in question is inside the ranch of the heirs of Hermogenes Chilsot under Pasture Lease Agreement No. 1244 and, therefore, inside the forest
zone; and that said ranch has a fence around it to show that other persons could not enter and cultivate the same, and that the signature of
then Acting District Land Officer Elias de Castro of South Cotabato has been forged to facilitate the issuance of patent in favor of Isagani Du
Timbol.

The above alleged circumstances are indicative of fraud in the filing of the application and obtaining title to the land, and if proven would
override respondent Judge's order dismissing the case without hearing. The misrepresentations of the applicant that he had been occupying
and cultivating the land and residing thereon are sufficient grounds to nullify the grant of the patent and title under Section 91 of the Public
Land Law which provides as follows:

That statements made in the application shall be considered as essential conditions or parts of any concession, title or
permit issued on the basis of such application, and any false statement thereon or omission of facts, changing, or
modifying the consideration of the facts set forth in such statement, and any subsequent modification, alteration, or
change of the material facts set forth in the application shall ipso facto produce the cancellation of the concession, title or
permit granted. ...

A certificate of title that is void may be ordered cancelled. A title will be considered void if it is procured through fraud, as when a person
applies for registration of the land under his name although the property belongs to another. In the case of disposable public lands, failure on
the part of the grantee to comply with the conditions imposed by law is a ground for holding such title void (Director of Lands vs. Court of
Appeals, et al., G.R. No. L-17696, May 19, 1966, 17 SCRA, 71, 79-80; emphasis supplied). The lapse of the one year period within which a
decree of title may be reopened for fraud would not prevent the cancellation thereof, for to hold that a title may become indefeasible by
registration, even if such title had been secured through fraud or in violation of the law, would be the height of absurdity. Registration should
not be a shield of fraud in securing title. (J. M. Tuason & Co., Inc. vs. Macalindog, L-15398, December 29, 1962, 6 SCRA 938, page 38).

Considering that it is the state is seeking the cancellation of the title of respondent Isagani Du Timbol, said title has not become indefeasible
for prescription cannot be invoked against the state. A title founded on fraud may be cancelled, notwithstanding the lapse of one year from
the issuance thereof, through a petition filed in court by the Solicitor General, (Sumail vs. Court of First Instance of Cotabato, 51 O.G. p. 2414
Phil. L-8278. 96 Phil. 946: Eugenio, et al., vs. Perdido, et al., G. R. No. L-7083, May 19, 1955; De los Santos vs. Roman Catholic Church of
Midsayap G.R. No. L-6088, Feb. 24, 1954, 94 Phil. 405).

Public land fraudulently included in patents or certificates of title may be recovered or reverted to the state in accordance with Section 101 of
the Public Land Act (Director of Lands vs. Jugado et al., G.R. No. L-14707, May 23, 1961). Prescription does not lie against the state in such
cases for the Statute of Limitations does not run against the state (Article 1108, paragraph 4 of the New Civil Code). The right of reversion or
reconveyance to the state is not barred prescription (Republic of the Philippines vs. Ramona Ruiz, et al., G.R. No. L-23712, April 29, 1968, 23
SCRA 348. People vs. Ramos, G.R. No. L-15484, Jan. 31, 1963, 47 SCRA 12; Government of the Philippines vs. Monte de Piedad 35 Phil. 728;
751-753).

Even granting that the title of private respondent Isagani Du Timbol can no longer be reopened under the Land Registration Act, the land
covered thereby may be reconveyed to the state in an action for reconveyance under Section 101 of Commonwealth Act 141 (Public Land
Act), for the remedy of reconveyance is adequately covered by the prayer of the complaint for the grant of such other relief as may be just
and equitable in the premises.

FOR ALL THE FOREGOING, the order of the respondent court, dated June 22, 1973, dismissing the complaint, and that of September 29,
1973, denying the motion for its reconsideration, both issued in Civil Case No. 1253 of the respondent court, are hereby annulled and set
aside. The respondent court shall proceed to hear said Civil Case and render judgment thereon accordingly. Costs against respondent Isagani
Du Timbol.
G.R. No. L-58867 June 22, 1984

DIRECTOR OF LANDS and DIRECTOR OF FOREST DEVELOPMENT, petitioners,

vs.
HON. COURT OF APPEALS and ANTONIO VALERIANO, GABRIELA VALERIANO VDA. DE LA CRUZ, LETICIA A. VALERIANO and
MARISSA VALERIANO DE LA ROSA, respondents.

The Solicitor General for petitioners.

Carlos C. Serapio for private respondents.

MELENCIO-HERRERA, J.:

Petitioners-public officials, through the Solicitor General, seek a review of the Decision and Resolution of the then Court of Appeals affirming
the judgment of the former Court of First Instance of Bulacan, Branch III, decreeing registration of a parcel of land in private respondents'
favor. The land in question, Identified as Lot 2347, Cad-302-D, Case 3, Obando Cadastre, under Plan Ap-03-000535, is situated in Obando,
Bulacan, and has an area of approximately 9.3 hectares. It adjoins the Kailogan River and private respondents have converted it into a
fishpond.

In their application for registration filed on May 10, 1976, private respondents (Applicants, for brevity) claimed that they are the co-owners in
fee simple of the land applied for partly through inheritance in 1918 and partly by purchase on May 2, 1958; that it is not within any forest
zone or military reservation; and that the same is assessed for taxation purposes in their names.

The Republic of the Philippines, represented by the Director of the Bureau of Forest Development opposed the application on the principal
ground that the land applied for is within the unclassified region of Obando, Bulacan, per BF Map LC No. 637 dated March 1, 1927; and that
areas within the unclassified region are denominated as forest lands and do not form part of the disposable and alienable portion of the public
domain.

After hearing, the Trial Court ordered registration of the subject land in favor of the Applicants. This was affirmed on appeal by respondent
Appellate Court, which found that "through indubitable evidence (Applicants) and their predecessors-in-interest have been in open, public,
continuous, peaceful and adverse possession of the subject parcel of land under a bona fide claim of ownership for more than 30 years prior
to the filing of the application" and are, therefore, entitled to registration. It further opined that "since the subject property is entirely devoted
to fishpond purposes, it cannot be categorized as part of forest lands. "

Before this instance, the principal issues posed are: (1) whether or not Courts can reclassify the subject public land; and (2) whether or not
applicants are entitled to judicial confirmation of title.

The parties, through their respective counsel, stipulated that the land is within an unclassified region of Obando, Bulacan, as shown by BF
Map LC No. 637, dated March 1, 1927. 1 No evidence has been submitted that the land has been released or subsequently classified despite
an Indorsement, dated November 17, 1976, of the District Forester, to the Director of Forest Development, containing the following
recommendation:

Subject area requested for release was verified and found to be within the Unclassified Region of Obando, Bulacan per BF
LC Map No. 637, certified March 1, 1927. However, on-the-spot inspection conducted by a representative of this Office, it
disclosed that the same was devoid of any forest growth and forms part of a well-developed and 100 percent producing
fishponds. Two houses of light materials were erected within the area for the caretakers temporary dwelling.

In view thereof, and in fairness to the applicant considering the investment introduced therein this Office believes that the
release is in order,

Recommended for approval and be disposed of in accordance with the Public Land Law. 2

The Government's case is meritorious.

In effect, what the Courts a quo have done is to release the subject property from the unclassified category, which is beyond their
competence and jurisdiction. The classification of public lands is an exclusive prerogative of the Executive Department of the Government and
not of the Courts. In the absence of such classification, the land remains as unclassified land until it is released therefrom and rendered open
to disposition. 3 This should be so under time-honored Constitutional precepts. This is also in consonance with the Regalian doctrine that all
lands of the public domain belong to the State, 4 and that the State is the source of any asserted right to ownership in land and charged with
the conservation of such patrimony. 5

The recommendation of the District Forester for release of subject property from the unclassified region is not the ultimate word on the
matter. And the fact that BF Map LC No. 637 dated March 1, 1927 showing subject property to be within the unclassified region was not
presented in evidence will not operate against the State considering the stipulation between the parties and under the well-settled rule that
the State cannot be estopped by the omission, mistake or error of its officials or agents, 6 if omission there was, in fact.

While it may be that the Municipality of Obando has been cadastrally surveyed in 1961, it does not follow that an lands comprised therein are
automatically released as alienable. A survey made in a cadastral proceeding merely Identifies each lot preparatory to a judicial proceeding
for adjudication of title to any of the lands upon claim of interested parties. Besides, if land is within the jurisdiction of the Bureau of Forest
Development, it would be beyond the jurisdiction of the Cadastral Court to register it under the Torrens System.

Since the subject property is still unclassified, whatever possession Applicants may have had, and, however long, cannot ripen into
private ownership. 7

The conversion of subject property into a fishpond by Applicants, or the alleged titling of properties around it, does not automatically render
the property as alienable and disposable. Applicants' remedy lies in the release of the property from its present classification. In fairness to
Applicants, and it appearing that there are titled lands around the subject property, petitioners-officials should give serious consideration to
the matter of classification of the land in question.

WHEREFORE, the appealed Decision is reversed and the application for registration in Land Registration Case No. N299-V-76 of the former
Court of First Instance of Bulacan, Branch III, is hereby dismissed, without prejudice to the availment by the applicants of the proper
administrative remedy. No costs. SO ORDERED.
G.R. No. L-32266 February 27, 1989

THE DIRECTOR OF FORESTRY, petitioner

vs.
RUPERTO A. VILLAREAL, respondent.

The Solicitor General for petitioner.

Quasha, Asperilla, Ancheta, Valmonte, Pena & Marcos for respondents.

CRUZ, J.:

The basic question before the Court is the legal classification of mangrove swamps, or manglares, as they are commonly known. If they are
part of our public forest lands, they are not alienable under the Constitution. If they are considered public agricultural lands, they may be
acquired under private ownership. The private respondent's claim to the land in question must be judged by these criteria.

The said land consists of 178,113 square meters of mangrove swamps located in the municipality of Sapian, Capiz. Ruperto Villareal applied
for its registration on January 25, 1949, alleging that he and his predecessors-in-interest had been in possession of the land for more than
forty years. He was opposed by several persons, including the petitioner on behalf of the Republic of the Philippines. After trial, the application
was approved by the Court of First Instance. of Capiz. 1 The decision was affirmed by the Court of Appeals. 2 The Director of Forestry then
came to this Court in a petition for review on certiorari claiming that the land in dispute was forestal in nature and not subject to private
appropriation. He asks that the registration be reversed.

It should be stressed at the outset that both the petitioner and the private respondent agree that the land is mangrove land. There is no
dispute as to this. The bone of contention between the parties is the legal nature of mangrove swamps or manglares. The petitioner claims, it
is forestal and therefore not disposable and the private respondent insists it is alienable as agricultural land. The issue before us is legal, not
factual.

For a proper background of this case, we have to go back to the Philippine Bill of 1902, one of the earlier American organic acts in the
country. By this law, lands of the public domain in the Philippine Islands were classified into three grand divisions, to wit, agricultural, mineral
and timber or forest lands. This classification was maintained in the Constitution of the Commonwealth, promulgated in 1935, until it was
superseded by the Constitution of 1973. That new charter expanded the classification of public lands to include industrial or commercial,
residential, resettlement, and grazing lands and even permitted the legislature to provide for other categories. 3 This provision has been
reproduced, but with substantial modifications, in the present Constitution. 4

Under the Commonwealth Constitution, which was the charter in force when this case arose, only agricultural lands were allowed to be
alienated. 5 Their disposition was provided for under C.A. No. 141. Mineral and timber or forest lands were not subject to private ownership
unless they were first reclassified as agricultural lands and so released for alienation.

In the leading case of Montano v. Insular Government, 6 promulgated in 1909, mangrove swamps or manglares were defined by the Court as:

... mud flats, alternately washed and exposed by the tide, in which grows various kindred plants which will not live except
when watered by the sea, extending their roots deep into the mud and casting their seeds, which also germinate there.
These constitute the mangrove flats of the tropics, which exist naturally, but which are also, to some extent cultivated by
man for the sake of the combustible wood of the mangrove and like trees as well as for the useful nipa palm propagated
thereon. Although these flats are literally tidal lands, yet we are of the opinion that they cannot be so regarded in the
sense in which that term is used in the cases cited or in general American jurisprudence. The waters flowing over them are
not available for purpose of navigation, and they may be disposed of without impairment of the public interest in what
remains.

xxx

Under this uncertain and somewhat unsatisfactory condition of the law, the custom had grown of converting manglares and
nipa lands into fisheries which became a common feature of settlement along the coast and at the same time of the
change of sovereignty constituted one of the most productive industries of the Islands, the abrogation of which would
destroy vested interests and prove a public disaster.

Mangrove swamps were thus considered agricultural lands and so susceptible of private ownership.

Subsequently, the Philippine Legislature categorically declared, despite the above-cited case, that mangrove swamps form part of the public
forests of this country. This it did in the Administrative Code of 1917, which became effective on October 1 of that year, thus:

Section 1820. Words and phrase defined. - For the purpose of this chapter 'public forest' includes, except as otherwise
specially indicated, all unreserved public land, including nipa and mangrove swamps, and all forest reserves of whatever
character.

It is noteworthy, though, that notwithstanding this definition, the Court maintained the doctrine in the Montano case when two years later it
held in the case of Jocson v. Director of Forestry: 7

...the words timber land are always translated in the Spanish translation of that Act (Act of Congress) as terrenos
forestales. We think there is an error in this translation and that a better translation would be 'terrenos madereros.'
Lumber land in English means land with trees growing on it. The mangler plant would never be called a tree in English but
a bush, and land which has only bushes, shrubs or aquatic plants growing on it cannot be called 'timber land.

xxx xxx xxx

The fact that there are a few trees growing in a manglare or nipa swamps does not change the general character of the
land from manglare to timber land.

More to the point, addressing itself directly to above-quoted Section 1820, the Court declared:

'In the case of Mapa vs. Insular Government (10 Phil. Rep., 175), this Court said that the phrase agricultural lands as used
in Act No. 926 means those public lands acquired from Spain which are not timber or mineral lands.
 Whatever may have been the meaning of the term 'forestry' under the Spanish law, the Act of Congress of July 1st 1902,
classifies the public lands in the Philippine Islands as timber, mineral or agricultural lands, and all public lands that are not
timber or mineral lands are necessarily agricultural public lands, whether they are used as nipa swamps, manglares,
fisheries or ordinary farm lands.

The definition of forestry as including manglares found in the Administrative Code of 1917 cannot affect rights which
vested prior to its enactment.

These lands being neither timber nor mineral lands, the trial court should have considered them agricultural lands. If they
are agricultural lands, then the rights of appellants are fully established by Act No. 926.

The doctrine was reiterated still later in Garchitorena Vda. de Centenera v. Obias, 8 promulgated on March 4, 1933, more than fifteen years
after the effectivity of the Administrative Code of 1917. Justice Ostrand declared for a unanimous Court:

The opposition rests mainly upon the proposition that the land covered by the application there are mangrove lands as
shown in his opponent's Exh. 1, but we think this opposition of the Director of Forestry is untenable, inasmuch as it has
been definitely decided that mangrove lands are not forest lands in the sense in which this phrase is used in the Act of
Congress.

No elaboration was made on this conclusion which was merely based on the cases of Montano and Jocson. And in 1977, the above ruling was
reaffirmed in Tongson v. Director of Forestry, 9 with Justice Fernando declaring that the mangrove lands in litis were agricultural in nature.
The decision even quoted with approval the statement of the trial court that:

... Mangrove swamps where only trees of mangrove species grow, where the trees are small and sparse, fit only for
firewood purposes and the trees growing are not of commercial value as lumber do not convert the land into public land.
Such lands are not forest in character. They do not form part of the public domain.

Only last year, in Republic v. De Porkan, 10 the Court, citing Krivenko v. Register of Deeds, 11 reiterated the ruling in the Mapa case that "all
public lands that are not timber or mineral lands are necessarily agricultural public lands, whether they are used as nipa
swamps, manglares, fisheries or ordinary farm lands.

But the problem is not all that simple. As it happens, there is also a line of decisions holding the contrary view.

In Yngson v. Secretary of Agriculture and Natural Resources, 12 promulgated in 1983, the Court ruled "that the Bureau of Fisheries has no
jurisdiction to dispose of swamp lands or mangrove lands forming part of the public domain while such lands are still classified as forest lands.

Four months later, in Heirs of Amunategui v. Director of Forestry, 13 the Court was more positive when it held, again through Justice
Gutierrez:

The Heirs of Jose Amunategui maintain that Lot No. 885 cannot be classified as forest land because it is not thickly
forested but is a 'mangrove swamps.' Although conceding that 'mangrove swamp' is included in the classification of forest
land in accordance with Section 1820 of the Revised Administrative Code, the petitioners argue that no big trees classified
in Section 1821 of the said Code as first, second and third groups are found on the land in question. Furthermore, they
contend that Lot 885, even if it is a mangrove swamp, is still subject to land registration proceedings because the property
had been in actual possession of private persons for many years, and therefore, said land was already 'private land' better
adapted and more valuable for agricultural than for forest purposes and not required by the public interests to be kept
under forest classification.

The petition is without merit.

A forested area classified as forest land of the public domain does not lose such classification simply because loggers or
settlers may have stripped it of its forest cover. Parcels of land classified as forest land may actually be covered with grass
or planted to crops by kaingin cultivators or other farmers. 'Forested lands' do not have to be on mountains or in out-of-
the-way places. Swampy areas covered by mangrove trees, nipa palms, and other trees growing in brackish or sea water
may also be classified as forest land. The classification is descriptive of its legal nature or status and does not have to be
descriptive of what the land actually looks like. Unless and until the land classsified as 'forest' is released in an official
proclamation to that effect so that it may form part of the disposable agricultural lands of the public domain, the rules on
confirmation of imperfect titles do not apply.'

The view was maintained in Vallarta v. Intermediate Appellate Court, 14 where this Court agreed with the Solicitor General's submission that
the land in dispute, which he described as "swamp mangrove or forestal land," were not private properties and so not registerable. This case
was decided only twelve days after the De Porkan case.

Faced with these apparent contradictions, the Court feels there is a need for a categorical pronouncement that should resolve once and for all
the question of whether mangrove swamps are agricultural lands or forest lands.

The determination of this question is a function initially belonging to the legislature, which has the authority to implement the constitutional
provision classifying the lands of the public domain (and is now even permitted to provide for more categories of public lands). The legislature
having made such implementation, the executive officials may then, in the discharge of their own role, administer our public lands pursuant
to their constitutional duty " to ensure that the laws be faithfully executed' and in accordance with the policy prescribed. For their part, the
courts will step into the picture if the rules laid down by the legislature are challenged or, assuming they are valid, it is claimed that they are
not being correctly observed by the executive. Thus do the three departments, coordinating with each other, pursue and achieve the
objectives of the Constitution in the conservation and utilization of our natural resources.

In C.A. No. 141, the National Assembly delegated to the President of the Philippines the function of making periodic classifications of public
lands, thus:

Sec. 6. The President, upon the recommendation of the Secretary of Agriculture and Natural Resources, shall from time to
time classify the lands of the public domain into:

(a) Alienable or disposable,

(b) Lumber, and

(c) Mineral lands,

 and may at any time and in a like manner transfer such lands from one class to another, for the purposes of their
administration and disposition.

Sec. 7. For the purposes of the administration and disposition of alienable or disposable lands, the President, upon
recommendation by the Secretary of Agriculture and Natural Resources, shall from time to time declare what lands are
open to disposition or concession under this Act.

With particular regard to alienable public lands, Section 9 of the same law provides:

For the purpose of their administration and disposition, the lands of the public domain alienable or open to disposition shall
be classified, according to the use or purposes to which such lands are destined, as follows:

(a) Agricultural;

(b) Residential, commercial, industrial, or for similar productive purposes;

(c) Educational, charitable, or other similar purposes; and

(d) Reservations for townsites and for public and quasi-public uses.

The President, upon recommendation by the Secretary of Agriculture and Natural Resources, shall from time to time make
the classifications provided for in this section, and may, at any time and in a similar manner, transfer lands from one class
to another.

As for timber or forest lands, the Revised Administrative Code states as follows:

Sec. 1826. Regulation setting apart forest reserves- Revocation of same. - Upon there commendation of the Director of
Forestry, with the approval of the Department Head, the President of the Philippines may set apart forest reserves from
the public lands and he shall by proclamation declare the establishment of such reserves and the boundaries thereof, and
thereafter such forest reserves shall not be entered, sold, or otherwise disposed of, but shall remain as such for forest
uses, and shall be administered in the same manner as public forest.

The President of the Philippines may in like manner by proclamation alter or modify the boundaries of any forest reserve
from time to time, or revoke any such proclamation, and upon such revocation such forest reserve shall be and become
part of the public lands as though such proclamation had never been made.

Sec. 1827. Assignment of forest land for agricultural purposes. - Lands in public forest, not including forest reserves, upon
the certification of the Director of Forestry that said lands are better adapted and more valuable for agricultural than for
forest purposes and not required by the public interests to be kept under forest, shall be declared by the Department Head
to be agricultural lands.

With these principles in mind, we reach the following conclusion:

Mangrove swamps or manglares should be understood as comprised within the public forests of the Philippines as defined in the aforecited
Section 1820 of the Administrative Code of 1917. The legislature having so determined, we have no authority to ignore or modify its decision,
and in effect veto it, in the exercise of our own discretion. The statutory definition remains unchanged to date and, no less noteworthy, is
accepted and invoked by the executive department. More importantly, the said provision has not been challenged as arbitrary or unrealistic or
unconstitutional assuming the requisite conditions, to justify our judicial intervention and scrutiny. The law is thus presumed valid and so
must be respected. We repeat our statement in the Amunategui case that the classification of mangrove swamps as forest lands is descriptive
of its legal nature or status and does not have to be descriptive of what the land actually looks like. That determination having been made
and no cogent argument having been raised to annul it, we have no duty as judges but to apply it. And so we shall.

Our previous description of the term in question as pertaining to our agricultural lands should be understood as covering only those lands
over which ownership had already vested before the Administrative Code of 1917 became effective. Such lands could not be retroactively
legislated as forest lands because this would be violative of a duly acquired property right protected by the due process clause. So we ruled
again only two months ago in Republic of the Philippines vs. Court of Appeals, 15 where the possession of the land in dispute commenced as
early as 1909, before it was much later classified as timberland.

It follows from all this that the land under contention being admittedly a part of the mangrove swamps of Sapian, and for which a minor
forest license had in fact been issued by the Bureau of Forestry from 1920 to 1950, it must be considered forest land. It could therefore not
be the subject of the adverse possession and consequent ownership claimed by the private respondent in support of his application for
registration. To be so, it had first to be released as forest land and reclassified as agricultural land pursuant to the certification the Director of
Forestry may issue under Section 1827 of the Revised Administrative Code.

The private respondent invokes the survey plan of the mangrove swamps approved by the Director of Lands, 16to prove that the land is
registerable. It should be plain, however, that the mere existence of such a plan would not have the effect of converting the mangrove
swamps, as forest land, into agricultural land. Such approval is ineffectual because it is clearly in officious. The Director of Lands was not
authorized to act in the premises. Under the aforecited law, it is the Director of Forestry who has the authority to determine whether forest
land is more valuable for agricultural rather than forestry uses, as a basis for its declaration as agricultural land and release for private
ownership.

Thus we held in the Yngson case:

It is elementary in the law governing the disposition of lands of the public domain that until timber or forest lands are
released as disposable and alienable neither the Bureau of Lands nor the Bureau of Fisheries has authority to lease, grant,
sell or otherwise dispose of these lands for homesteads, sales patents, leases for grazing or other purposes, fishpond
leases and other modes of utilization.

The Bureau of Fisheries has no jurisdiction to administer and dispose of swamp lands or mangrove lands forming part of
the public domain while such lands are still classified as forest land or timber land and not released for fishery or other
purposes.

The same rule was echoed in the Vallarta case, thus:

 It is elementary in the law governing natural resources that forest land cannot be owned by private persons. It is not
registerable. The adverse possession which can be the basis of a grant of title in confirmation of imperfect title cases
cannot commence until after the forest land has been declared alienable and disposable. Possession of forest land, no
matter bow long cannot convert it into private property.'

We find in fact that even if the land in dispute were agricultural in nature, the proof the private respondent offers of prescriptive possession
thereof is remarkably meager and of dubious persuasiveness. The record contains no convincing evidence of the existence of
the informacion posesoria allegedly obtained by the original transferor of the property, let alone the fact that the conditions for acquiring title
thereunder have been satisfied. Nowhere has it been shown that the informacion posesoria has been inscribed or registered in the registry of
property and that the land has been under the actual and adverse possession of the private respondent for twenty years as required by the
Spanish Mortgage Law. 17 These matters are not presumed but must be established with definite proof, which is lacking in this case.

Significantly, the tax declarations made by the private respondent were practically the only basis used by the appellate court in sustaining his
claim of possession over the land in question. Tax declarations are, of course, not sufficient to prove possession and much less vest ownership
in favor of the declarant, as we have held in countless cases. 18

We hold, in sum, that the private respondent has not established his right to the registration of the subject land in his name. Accordingly, the
petition must be granted.

It is reiterated for emphasis that, conformably to the legislative definition embodied in Section 1820 of the Revised Administrative Code of
1917, which remains unamended up to now, mangrove swamps or manglares form part of the public forests of the Philippines. As such, they
are not alienable under the Constitution and may not be the subject of private ownership until and unless they are first released as forest land
and classified as alienable agricultural land.

WHEREFORE, the decision of the Court of Appeals is SET ASIDE and the application for registration of title of private respondent is
DISMISSED, with cost against him. This decision is immediately executory. SO ORDERED.
G.R. No. L-57112 November 29, 1984

REPUBLIC OF THE PHILIPPINES, represented by the DIRECTOR OF LANDS, petitioner,

vs.
JUDGE SINFOROSO FAÑGONIL, of CFI Baguio and Benguet, Branch IV, MODESTA PARIS, LAGYA PARIS, SAMUEL BALIWAN,
PABLO RAMOS, JR., JOSEPHINE ABANAG, MENITA T. VICTOR, EMILIANO BAUTISTA and ODI DIANSON, respondents.

Beltran, Beltran & Beltran Law Office for respondent Ramos, Jr.

Nicolas R. Cruz for respondent S. Baliwan.

Benigno M. Sabbar, Jr. for respondent E. Bautista.

Melchor Raras for respondent Paris.

Benedicto T. Carantos for respondent Odi Dianson.

AQUINO, J.:

This case is about the registration of lots located within the Baguio Townsite Reservation. As background, it should be noted that in 1912 a
petition was filed in the Court of Land Registration regarding the Baguio Townsite Reservation, Expediente de Reserve No. 1, GLRO
Reservation Record No. 211. In 1914, when the Land Registration Court was abolished, the record was transferred to the Court of First
Instance of Benguet.

The purpose of Case No. 211 was to determine once and for all what portions of the Baguio Townsite Reservation were private and
registerable under Act No. 496 as provided in section 62 of Act No. 926. Once so determined, no further registration proceeding would be
allowed (Secs. 3 and 4, Act No. 627).

The court on July 22, 1915 issued a notice requiring all persons claiming lots inside the reservation to file within six months from the date of
the notice petitions for the registration of their titles under Act No. 496. On June 13, 1922, the General Land Registration Office submitted to
the court a report regarding the applications for registration. The case was duly heard.

Judge C. M. Villareal in a decision dated November 13,1922 held that all lands within the Reservation are public lands with the exception of
(1) lands reserved for specified public uses and (2) lands claimed and adjudicated asprivate property. He ruled that claims for private lands
by all persons not presented for registration within the period fixed in Act No. 627, in relation to the first Public Land Law, Act No. 926, were
barred forever. (Secs. 3 and 4, Act No. 627.)

That 1922 decision established the rule that lots of the Baguio Townsite Reservation, being public domain, are not registerable under Act No.
496. As held by Judge Belmonte in a 1973 case, the Baguio Court of First Instance "has no Jurisdiction to entertain any land registration
proceedings" under Act No. 496 and the Public Land Law, covering any lot within the Baguio Townsite Reservation which was terminated in
1922 (Camdas vs. Director of Lands, L-37782, Resolution of this Court of March 8, 1974, dismissing petition for review of Judge Belmonte's
ruling).

In the instant case, after more than half a century from the 1922 decision declaring the townsite public domain, or during the years 1972 to
1976, Modesta Paris, Lagya Paris, Samuel Baliwan, Pablo Ramos, Jr., Josephine Abanag, Menita T. Victor, Emiliano Bautista and Odi Dianson
filed with the Court of First Instance of Baguio applications for the registration of lots (with considerable areas) inside the Baguio Townsite
Reservation.

Alternatively, they allege that in case the lots are not registerable under Act No. 496, then section 48 (b) and (c) of the Public Land Law
should be applied because they and their predecessors have been in possession of the lots for more than thirty years.

The Director of Lands opposed the applications. He filed motions to dismiss on the grounds of lack of jurisdiction, prescription and res
judicata. He relied on the decision in the first registration case, a proceeding in rem, which barred all subsequent registrations of the Baguio
Townsite lots. He contended that the disposition of said lots should be made by the Director of Lands under Chapter 11 of the Public Land Law
regarding Townsite Reservations. (See Cojuangco vs. Marcos, 82 SCRA 156).

The trial judge admits that section 48 cannot be invoked by the applicants because it applies only to disposable agricultural lands
situated outside the reservation. He concedes that lands within the Baguio Townsite Reservation may not be acquired by long possession for
over thirty years subsequent to Case No. 211 (p. 195, Rollo).

But he refused to dismiss the applicants because in his opinion "there is a necessity of (for) the presentation of satisfactory evidence in a
regular hearing as to the presence or absence of complete service of notice" so that the court can determine whether the applications are
barred by res judicata. He relies on the isolated case of Zarate vs. Director of Lands, 58 Phil. 156.

The Solicitor General assailed by certiorari that order denying the motions to dismiss.

Sections 3 and 4 of Act No. 627, the law governing military reservations, contemplate notification to two classes of persons, namely, (1)
those who are living upon or in visible possession of any part of the military reservation and (2) persons who are not living upon or in visible
possession but are absentees.

A distinction is made between these two classes of persons as to the manner in which service of the notice shall be made. Service is complete
as to absentees when publication of the notice in the newspaper is completed and duly fixed upon the four corners of the premises. The six-
month period commences to run from that time.

On the other hand, as to those who are living upon or in visible possession of the lands, service is not complete, and the six-month period
does not begin to run until the notice is served upon them personally. Their rights relative to the period within which they must respond are
determined by the date of the personal service.

Their notice was a personal notice given by personal service. Only such notice could set the running of the six-month period against them.
(Lagariza, Saba and Garcia vs. Commanding General, 22 Phil. 297, 302; Zarate vs. Director of Lands, 58 Phil. 156,159- 160.)

As already noted, the fact is that the notice in Case No: 211 was issued on July 22, 1915. The clerk of court certified that 134 persons living
upon or in visible possession of any part of the reservation were personally served with notice of the reservation. Section 3 of Act No. 627
provides that the certificate of the clerk of court is "conclusive proof of service". (Zarate case, pp. 158,162.)
In the Zarate case, the applications for registration of lots within the Baguio Townsite Reservation were filed in 1930 and 1931 or more than
eight years after the decision was rendered in 1922.

The Zarate case is truly an exceptional case because the applicants were able to prove that in 1915 they were in visible occupation of their
lots and the clerk of court did not serve personal notice upon them. The expediente of Case No. 211 was then still existing. The Zarate case
cannot be a precedent at this late hour.

The situation in the Zarate case has not been duplicated since 1933. Judge Fangonil seeks to apply the ruling therein to the instant eight
cases. We find that his order is unwarranted or unreasonable. It would reopen Case No. 211. It would give way to baseless litigations
intended to be foreclosed by that 1912 case.

Private claimants to lands within the Baguio Townsite Reservation were given a chance to register their lands in Case No. 211. The provisions
of Act No. 627, allowing them to do so, are in harmony with the 1909 epochal decision of Justice Holmes in Cariño vs. Insular
Government, 212 U.S. 449, 41 Phil. 935. The two Igorots named Zarate and those who were allowed to register their lots in Case No. 211,
like Mateo Carino, the Igorot involved in the Cariño case, inherited their lands from their ancestors. They had possession of the lands since
time immemorial. The Igorots were allowed to avail themselves of registration under Act No. 496.

Here, the eight applicants do not base their applications under Act No. 496 on any purchase or grant from the State nor on possession since
time immemorial. That is why Act No. 496 cannot apply to them. (See Manila Electric Company vs. Castro-Bartolome, L- 49623, June 29,
1982, 114 SCRA 799.) They are not "Igorot claimants" (See p. 35, Memo of Solicitor General).

Moreover, Annex I of the petition for certiorari shows that the previous attempts of some applicants and their predecessors to reopen Case
No. 211 were dismissed as shown below:

Name Date Filed Date Dismissed

1) Samuel Baliwan Dec. 27, 1968 Aug. 15, 1970

2) Tommy Banguillas, predecessor of

Pablo Ramos, Jr. May 6, 1965 June 19, 1967

3) Josephine Abanag Jan. 9, 1961 July 9, 1963

4) Sergio Molintas, predecessor of

Josephine Abanag Dec. 26, 1968 Oct. 31, 1974

5) Josephine Abanag April 26, 1966 Nov. 12, 1974

6) Lagya Paris Oct. 15, 1965 Nov. 13, 1974

In the case of Abanag, she succeeded to two lots claimed by Sumay and Molintas for which Torrens titles were issued in Case No. 211 on
October 21, 1919 (Annexes J and K of Petition). The lots, which Abanag now seeks to register, were not previously claimed by her
predecessors in Case No. 211 (p. 33, Sol. Gen.'s Memo).

We hold that the trial court erred in requiring the presentation of evidence as to the notice required under Act No. 627. Such evidence cannot
be produced at this time because the court record of Case No. 211 was completely destroyed during the last war.

Anyway, the applicants have the burden of proving that their predecessors were living upon or in visible possession of the lands in 1915 and
were not served any notice. If they have such evidence, apart from unreliable oral testimony, they should have produced it during the hearing
on the motions to dismiss.

To support his motions to dismiss, the Solicitor General introduced evidence proving that after Case No. 211 it has always been necessary to
issue Presidential proclamations for the disposition of portions of the Baguio Townsite Reservation (Annex E of Petition).

The period of more than fifty years completely bars the applicants from securing relief due to the alleged lack of personal notice to their
predecessors. The law helps the vigilant but not those who sleep on their rights. "For time is a means of destroying obligations
and actions, because time runs against the slothful and contemners of their own rights."

WHEREFORE, the order denying the motions to dismiss is reversed and set aside. The applications for registration are hereby dismissed. No
costs. SO ORDERED.
G.R. No. 133250 July 9, 2002

FRANCISCO I. CHAVEZ, petitioner,

vs.
PUBLIC ESTATES AUTHORITY and AMARI COASTAL BAY DEVELOPMENT CORPORATION, respondents.

CARPIO, J.:

This is an original Petition for Mandamus with prayer for a writ of preliminary injunction and a temporary restraining order. The petition seeks
to compel the Public Estates Authority ("PEA" for brevity) to disclose all facts on PEA's then on-going renegotiations with Amari Coastal Bay
and Development Corporation ("AMARI" for brevity) to reclaim portions of Manila Bay. The petition further seeks to enjoin PEA from signing a
new agreement with AMARI involving such reclamation.

The Facts

On November 20, 1973, the government, through the Commissioner of Public Highways, signed a contract with the Construction and
Development Corporation of the Philippines ("CDCP" for brevity) to reclaim certain foreshore and offshore areas of Manila Bay. The contract
also included the construction of Phases I and II of the Manila-Cavite Coastal Road. CDCP obligated itself to carry out all the works in
consideration of fifty percent of the total reclaimed land.

On February 4, 1977, then President Ferdinand E. Marcos issued Presidential Decree No. 1084 creating PEA. PD No. 1084 tasked PEA "to
reclaim land, including foreshore and submerged areas," and "to develop, improve, acquire, x x x lease and sell any and all kinds of
lands."1 On the same date, then President Marcos issued Presidential Decree No. 1085 transferring to PEA the "lands reclaimed in the
foreshore and offshore of the Manila Bay"2 under the Manila-Cavite Coastal Road and Reclamation Project (MCCRRP).

On December 29, 1981, then President Marcos issued a memorandum directing PEA to amend its contract with CDCP, so that "[A]ll future
works in MCCRRP x x x shall be funded and owned by PEA." Accordingly, PEA and CDCP executed a Memorandum of Agreement dated
December 29, 1981, which stated:

"(i) CDCP shall undertake all reclamation, construction, and such other works in the MCCRRP as may be agreed upon by the parties,
to be paid according to progress of works on a unit price/lump sum basis for items of work to be agreed upon, subject to price
escalation, retention and other terms and conditions provided for in Presidential Decree No. 1594. All the financing required for such
works shall be provided by PEA.

xxx

(iii) x x x CDCP shall give up all its development rights and hereby agrees to cede and transfer in favor of PEA, all of the rights, title,
interest and participation of CDCP in and to all the areas of land reclaimed by CDCP in the MCCRRP as of December 30, 1981 which
have not yet been sold, transferred or otherwise disposed of by CDCP as of said date, which areas consist of approximately Ninety-
Nine Thousand Four Hundred Seventy Three (99,473) square meters in the Financial Center Area covered by land pledge No. 5 and
approximately Three Million Three Hundred Eighty Two Thousand Eight Hundred Eighty Eight (3,382,888) square meters of
reclaimed areas at varying elevations above Mean Low Water Level located outside the Financial Center Area and the First
Neighborhood Unit."3

On January 19, 1988, then President Corazon C. Aquino issued Special Patent No. 3517, granting and transferring to PEA "the parcels of land
so reclaimed under the Manila-Cavite Coastal Road and Reclamation Project (MCCRRP) containing a total area of one million nine hundred
fifteen thousand eight hundred ninety four (1,915,894) square meters." Subsequently, on April 9, 1988, the Register of Deeds of the
Municipality of Parañaque issued Transfer Certificates of Title Nos. 7309, 7311, and 7312, in the name of PEA, covering the three reclaimed
islands known as the "Freedom Islands" located at the southern portion of the Manila-Cavite Coastal Road, Parañaque City. The Freedom
Islands have a total land area of One Million Five Hundred Seventy Eight Thousand Four Hundred and Forty One (1,578,441) square meters or
157.841 hectares.

On April 25, 1995, PEA entered into a Joint Venture Agreement ("JVA" for brevity) with AMARI, a private corporation, to develop the Freedom
Islands. The JVA also required the reclamation of an additional 250 hectares of submerged areas surrounding these islands to complete the
configuration in the Master Development Plan of the Southern Reclamation Project-MCCRRP. PEA and AMARI entered into the JVA through
negotiation without public bidding.4 On April 28, 1995, the Board of Directors of PEA, in its Resolution No. 1245, confirmed the JVA.5On June
8, 1995, then President Fidel V. Ramos, through then Executive Secretary Ruben Torres, approved the JVA.6

On November 29, 1996, then Senate President Ernesto Maceda delivered a privilege speech in the Senate and denounced the JVA as the
"grandmother of all scams." As a result, the Senate Committee on Government Corporations and Public Enterprises, and the Committee on
Accountability of Public Officers and Investigations, conducted a joint investigation. The Senate Committees reported the results of their
investigation in Senate Committee Report No. 560 dated September 16, 1997.7 Among the conclusions of their report are: (1) the reclaimed
lands PEA seeks to transfer to AMARI under the JVA are lands of the public domain which the government has not classified as alienable lands
and therefore PEA cannot alienate these lands; (2) the certificates of title covering the Freedom Islands are thus void, and (3) the JVA itself is
illegal.

On December 5, 1997, then President Fidel V. Ramos issued Presidential Administrative Order No. 365 creating a Legal Task Force to conduct
a study on the legality of the JVA in view of Senate Committee Report No. 560. The members of the Legal Task Force were the Secretary of
Justice,8 the Chief Presidential Legal Counsel,9 and the Government Corporate Counsel.10 The Legal Task Force upheld the legality of the JVA,
contrary to the conclusions reached by the Senate Committees.11

On April 4 and 5, 1998, the Philippine Daily Inquirer and Today published reports that there were on-going renegotiations between PEA and
AMARI under an order issued by then President Fidel V. Ramos. According to these reports, PEA Director Nestor Kalaw, PEA Chairman Arsenio
Yulo and retired Navy Officer Sergio Cruz composed the negotiating panel of PEA.

On April 13, 1998, Antonio M. Zulueta filed before the Court a Petition for Prohibition with Application for the Issuance of a Temporary
Restraining Order and Preliminary Injunction docketed as G.R. No. 132994 seeking to nullify the JVA. The Court dismissed the petition "for
unwarranted disregard of judicial hierarchy, without prejudice to the refiling of the case before the proper court."12

On April 27, 1998, petitioner Frank I. Chavez ("Petitioner" for brevity) as a taxpayer, filed the instant Petition for Mandamus with Prayer for
the Issuance of a Writ of Preliminary Injunction and Temporary Restraining Order. Petitioner contends the government stands to lose billions
of pesos in the sale by PEA of the reclaimed lands to AMARI. Petitioner prays that PEA publicly disclose the terms of any renegotiation of the
JVA, invoking Section 28, Article II, and Section 7, Article III, of the 1987 Constitution on the right of the people to information on matters of
public concern. Petitioner assails the sale to AMARI of lands of the public domain as a blatant violation of Section 3, Article XII of the 1987
Constitution prohibiting the sale of alienable lands of the public domain to private corporations. Finally, petitioner asserts that he seeks to
enjoin the loss of billions of pesos in properties of the State that are of public dominion.
After several motions for extension of time,13 PEA and AMARI filed their Comments on October 19, 1998 and June 25, 1998, respectively.
Meanwhile, on December 28, 1998, petitioner filed an Omnibus Motion: (a) to require PEA to submit the terms of the renegotiated PEA-AMARI
contract; (b) for issuance of a temporary restraining order; and (c) to set the case for hearing on oral argument. Petitioner filed a Reiterative
Motion for Issuance of a TRO dated May 26, 1999, which the Court denied in a Resolution dated June 22, 1999.

In a Resolution dated March 23, 1999, the Court gave due course to the petition and required the parties to file their respective memoranda.

On March 30, 1999, PEA and AMARI signed the Amended Joint Venture Agreement ("Amended JVA," for brevity). On May 28, 1999, the Office
of the President under the administration of then President Joseph E. Estrada approved the Amended JVA.

Due to the approval of the Amended JVA by the Office of the President, petitioner now prays that on "constitutional and statutory grounds the
renegotiated contract be declared null and void."14

The Issues

The issues raised by petitioner, PEA15 and AMARI16 are as follows:

I. WHETHER THE PRINCIPAL RELIEFS PRAYED FOR IN THE PETITION ARE MOOT AND ACADEMIC BECAUSE OF SUBSEQUENT
EVENTS;

II. WHETHER THE PETITION MERITS DISMISSAL FOR FAILING TO OBSERVE THE PRINCIPLE GOVERNING THE HIERARCHY OF
COURTS;

III. WHETHER THE PETITION MERITS DISMISSAL FOR NON-EXHAUSTION OF ADMINISTRATIVE REMEDIES;

IV. WHETHER PETITIONER HAS LOCUS STANDI TO BRING THIS SUIT;

V. WHETHER THE CONSTITUTIONAL RIGHT TO INFORMATION INCLUDES OFFICIAL INFORMATION ON ON-GOING NEGOTIATIONS
BEFORE A FINAL AGREEMENT;

VI. WHETHER THE STIPULATIONS IN THE AMENDED JOINT VENTURE AGREEMENT FOR THE TRANSFER TO AMARI OF CERTAIN
LANDS, RECLAIMED AND STILL TO BE RECLAIMED, VIOLATE THE 1987 CONSTITUTION; AND

VII. WHETHER THE COURT IS THE PROPER FORUM FOR RAISING THE ISSUE OF WHETHER THE AMENDED JOINT VENTURE
AGREEMENT IS GROSSLY DISADVANTAGEOUS TO THE GOVERNMENT.

The Court's Ruling

First issue: whether the principal reliefs prayed for in the petition are moot and academic because of subsequent events.

The petition prays that PEA publicly disclose the "terms and conditions of the on-going negotiations for a new agreement." The petition also
prays that the Court enjoin PEA from "privately entering into, perfecting and/or executing any new agreement with AMARI."

PEA and AMARI claim the petition is now moot and academic because AMARI furnished petitioner on June 21, 1999 a copy of the signed
Amended JVA containing the terms and conditions agreed upon in the renegotiations. Thus, PEA has satisfied petitioner's prayer for a public
disclosure of the renegotiations. Likewise, petitioner's prayer to enjoin the signing of the Amended JVA is now moot because PEA and AMARI
have already signed the Amended JVA on March 30, 1999. Moreover, the Office of the President has approved the Amended JVA on May 28,
1999.

Petitioner counters that PEA and AMARI cannot avoid the constitutional issue by simply fast-tracking the signing and approval of the Amended
JVA before the Court could act on the issue. Presidential approval does not resolve the constitutional issue or remove it from the ambit of
judicial review.

We rule that the signing of the Amended JVA by PEA and AMARI and its approval by the President cannot operate to moot the petition and
divest the Court of its jurisdiction. PEA and AMARI have still to implement the Amended JVA. The prayer to enjoin the signing of the Amended
JVA on constitutional grounds necessarily includes preventing its implementation if in the meantime PEA and AMARI have signed one in
violation of the Constitution. Petitioner's principal basis in assailing the renegotiation of the JVA is its violation of Section 3, Article XII of the
Constitution, which prohibits the government from alienating lands of the public domain to private corporations. If the Amended JVA indeed
violates the Constitution, it is the duty of the Court to enjoin its implementation, and if already implemented, to annul the effects of such
unconstitutional contract.

The Amended JVA is not an ordinary commercial contract but one which seeks to transfer title and ownership to 367.5 hectares of
reclaimed lands and submerged areas of Manila Bay to a single private corporation. It now becomes more compelling for the Court
to resolve the issue to insure the government itself does not violate a provision of the Constitution intended to safeguard the national
patrimony. Supervening events, whether intended or accidental, cannot prevent the Court from rendering a decision if there is a grave
violation of the Constitution. In the instant case, if the Amended JVA runs counter to the Constitution, the Court can still prevent the transfer
of title and ownership of alienable lands of the public domain in the name of AMARI. Even in cases where supervening events had made the
cases moot, the Court did not hesitate to resolve the legal or constitutional issues raised to formulate controlling principles to guide the
bench, bar, and the public.17

Also, the instant petition is a case of first impression. All previous decisions of the Court involving Section 3, Article XII of the 1987
Constitution, or its counterpart provision in the 1973 Constitution,18 covered agricultural landssold to private corporations which acquired
the lands from private parties. The transferors of the private corporations claimed or could claim the right to judicial confirmation of their
imperfect titles19 under Title II of Commonwealth Act. 141 ("CA No. 141" for brevity). In the instant case, AMARI seeks to acquire from
PEA, a public corporation, reclaimed lands and submerged areas for non-agricultural purposes by purchase under PD No. 1084 (charter of
PEA) and Title III of CA No. 141. Certain undertakings by AMARI under the Amended JVA constitute the consideration for the purchase.
Neither AMARI nor PEA can claim judicial confirmation of their titles because the lands covered by the Amended JVA are newly reclaimed or
still to be reclaimed. Judicial confirmation of imperfect title requires open, continuous, exclusive and notorious occupation of agricultural lands
of the public domain for at least thirty years since June 12, 1945 or earlier. Besides, the deadline for filing applications for judicial
confirmation of imperfect title expired on December 31, 1987.20

Lastly, there is a need to resolve immediately the constitutional issue raised in this petition because of the possible transfer at any time by
PEA to AMARI of title and ownership to portions of the reclaimed lands. Under the Amended JVA, PEA is obligated to transfer to AMARI the
latter's seventy percent proportionate share in the reclaimed areas as the reclamation progresses. The Amended JVA even allows AMARI to
mortgage at any time the entire reclaimed area to raise financing for the reclamation project.21
 Second issue: whether the petition merits dismissal for failing to observe the principle governing the hierarchy of courts.

PEA and AMARI claim petitioner ignored the judicial hierarchy by seeking relief directly from the Court. The principle of hierarchy of courts
applies generally to cases involving factual questions. As it is not a trier of facts, the Court cannot entertain cases involving factual issues. The
instant case, however, raises constitutional issues of transcendental importance to the public.22 The Court can resolve this case without
determining any factual issue related to the case. Also, the instant case is a petition for mandamus which falls under the original jurisdiction
of the Court under Section 5, Article VIII of the Constitution. We resolve to exercise primary jurisdiction over the instant case.

Third issue: whether the petition merits dismissal for non-exhaustion of administrative remedies.

PEA faults petitioner for seeking judicial intervention in compelling PEA to disclose publicly certain information without first asking PEA the
needed information. PEA claims petitioner's direct resort to the Court violates the principle of exhaustion of administrative remedies. It also
violates the rule that mandamus may issue only if there is no other plain, speedy and adequate remedy in the ordinary course of law.

PEA distinguishes the instant case from Tañada v. Tuvera23 where the Court granted the petition for mandamus even if the petitioners there
did not initially demand from the Office of the President the publication of the presidential decrees. PEA points out that in Tañada, the
Executive Department had an affirmative statutory duty under Article 2 of the Civil Code24 and Section 1 of Commonwealth Act No.
63825 to publish the presidential decrees. There was, therefore, no need for the petitioners in Tañada to make an initial demand from the
Office of the President. In the instant case, PEA claims it has no affirmative statutory duty to disclose publicly information about its
renegotiation of the JVA. Thus, PEA asserts that the Court must apply the principle of exhaustion of administrative remedies to the instant
case in view of the failure of petitioner here to demand initially from PEA the needed information.

The original JVA sought to dispose to AMARI public lands held by PEA, a government corporation. Under Section 79 of the Government
Auditing Code,26 the disposition of government lands to private parties requires public bidding. PEA was under a positive legal duty to
disclose to the public the terms and conditions for the sale of its lands. The law obligated PEA to make this public disclosure even
without demand from petitioner or from anyone. PEA failed to make this public disclosure because the original JVA, like the Amended JVA,
was the result of a negotiated contract, not of a public bidding. Considering that PEA had an affirmative statutory duty to make the public
disclosure, and was even in breach of this legal duty, petitioner had the right to seek direct judicial intervention.

Moreover, and this alone is determinative of this issue, the principle of exhaustion of administrative remedies does not apply when the issue
involved is a purely legal or constitutional question.27 The principal issue in the instant case is the capacity of AMARI to acquire lands held by
PEA in view of the constitutional ban prohibiting the alienation of lands of the public domain to private corporations. We rule that the principle
of exhaustion of administrative remedies does not apply in the instant case.

Fourth issue: whether petitioner has locus standi to bring this suit

PEA argues that petitioner has no standing to institute mandamus proceedings to enforce his constitutional right to information without a
showing that PEA refused to perform an affirmative duty imposed on PEA by the Constitution. PEA also claims that petitioner has not shown
that he will suffer any concrete injury because of the signing or implementation of the Amended JVA. Thus, there is no actual controversy
requiring the exercise of the power of judicial review.

The petitioner has standing to bring this taxpayer's suit because the petition seeks to compel PEA to comply with its constitutional duties.
There are two constitutional issues involved here. First is the right of citizens to information on matters of public concern. Second is the
application of a constitutional provision intended to insure the equitable distribution of alienable lands of the public domain among Filipino
citizens. The thrust of the first issue is to compel PEA to disclose publicly information on the sale of government lands worth billions of pesos,
information which the Constitution and statutory law mandate PEA to disclose. The thrust of the second issue is to prevent PEA from
alienating hundreds of hectares of alienable lands of the public domain in violation of the Constitution, compelling PEA to comply with a
constitutional duty to the nation.

Moreover, the petition raises matters of transcendental importance to the public. In Chavez v. PCGG,28 the Court upheld the right of a citizen
to bring a taxpayer's suit on matters of transcendental importance to the public, thus -

"Besides, petitioner emphasizes, the matter of recovering the ill-gotten wealth of the Marcoses is an issue of 'transcendental
importance to the public.' He asserts that ordinary taxpayers have a right to initiate and prosecute actions questioning the validity of
acts or orders of government agencies or instrumentalities, if the issues raised are of 'paramount public interest,' and if they
'immediately affect the social, economic and moral well being of the people.'

Moreover, the mere fact that he is a citizen satisfies the requirement of personal interest, when the proceeding involves the
assertion of a public right, such as in this case. He invokes several decisions of this Court which have set aside the procedural
matter of locus standi, when the subject of the case involved public interest.

xxx

In Tañada v. Tuvera, the Court asserted that when the issue concerns a public right and the object of mandamus is to obtain the
enforcement of a public duty, the people are regarded as the real parties in interest; and because it is sufficient that petitioner is a
citizen and as such is interested in the execution of the laws, he need not show that he has any legal or special interest in the result
of the action. In the aforesaid case, the petitioners sought to enforce their right to be informed on matters of public concern, a right
then recognized in Section 6, Article IV of the 1973 Constitution, in connection with the rule that laws in order to be valid and
enforceable must be published in the Official Gazette or otherwise effectively promulgated. In ruling for the petitioners' legal
standing, the Court declared that the right they sought to be enforced 'is a public right recognized by no less than the fundamental
law of the land.'

Legaspi v. Civil Service Commission, while reiterating Tañada, further declared that 'when a mandamus proceeding involves the
assertion of a public right, the requirement of personal interest is satisfied by the mere fact that petitioner is a citizen and,
therefore, part of the general 'public' which possesses the right.'

Further, in Albano v. Reyes, we said that while expenditure of public funds may not have been involved under the questioned
contract for the development, management and operation of the Manila International Container Terminal, 'public interest [was]
definitely involved considering the important role [of the subject contract] . . . in the economic development of the country and the
magnitude of the financial consideration involved.' We concluded that, as a consequence, the disclosure provision in the Constitution
would constitute sufficient authority for upholding the petitioner's standing.

Similarly, the instant petition is anchored on the right of the people to information and access to official records, documents and
papers — a right guaranteed under Section 7, Article III of the 1987 Constitution. Petitioner, a former solicitor general, is a Filipino
citizen. Because of the satisfaction of the two basic requisites laid down by decisional law to sustain petitioner's legal standing, i.e.
(1) the enforcement of a public right (2) espoused by a Filipino citizen, we rule that the petition at bar should be allowed."
We rule that since the instant petition, brought by a citizen, involves the enforcement of constitutional rights - to information and to the
equitable diffusion of natural resources - matters of transcendental public importance, the petitioner has the requisite locus standi.

Fifth issue: whether the constitutional right to information includes official information on on-going negotiations before a final
agreement.

Section 7, Article III of the Constitution explains the people's right to information on matters of public concern in this manner:

"Sec. 7. The right of the people to information on matters of public concern shall be recognized. Access to official records, and to
documents, and papers pertaining to official acts, transactions, or decisions, as well as to government research data used
as basis for policy development, shall be afforded the citizen, subject to such limitations as may be provided by law." (Emphasis
supplied)

The State policy of full transparency in all transactions involving public interest reinforces the people's right to information on matters of
public concern. This State policy is expressed in Section 28, Article II of the Constitution, thus:

"Sec. 28. Subject to reasonable conditions prescribed by law, the State adopts and implements a policy of full public disclosure
of all its transactions involving public interest." (Emphasis supplied)

These twin provisions of the Constitution seek to promote transparency in policy-making and in the operations of the government, as well as
provide the people sufficient information to exercise effectively other constitutional rights. These twin provisions are essential to the exercise
of freedom of expression. If the government does not disclose its official acts, transactions and decisions to citizens, whatever citizens say,
even if expressed without any restraint, will be speculative and amount to nothing. These twin provisions are also essential to hold public
officials "at all times x x x accountable to the people,"29 for unless citizens have the proper information, they cannot hold public officials
accountable for anything. Armed with the right information, citizens can participate in public discussions leading to the formulation of
government policies and their effective implementation. An informed citizenry is essential to the existence and proper functioning of any
democracy. As explained by the Court in Valmonte v. Belmonte, Jr.30 –

"An essential element of these freedoms is to keep open a continuing dialogue or process of communication between the
government and the people. It is in the interest of the State that the channels for free political discussion be maintained to the end
that the government may perceive and be responsive to the people's will. Yet, this open dialogue can be effective only to the extent
that the citizenry is informed and thus able to formulate its will intelligently. Only when the participants in the discussion are aware
of the issues and have access to information relating thereto can such bear fruit."

PEA asserts, citing Chavez v. PCGG,31 that in cases of on-going negotiations the right to information is limited to "definite propositions of the
government." PEA maintains the right does not include access to "intra-agency or inter-agency recommendations or communications during
the stage when common assertions are still in the process of being formulated or are in the 'exploratory stage'."

Also, AMARI contends that petitioner cannot invoke the right at the pre-decisional stage or before the closing of the transaction. To support
its contention, AMARI cites the following discussion in the 1986 Constitutional Commission:

"Mr. Suarez. And when we say 'transactions' which should be distinguished from contracts, agreements, or treaties or whatever,
does the Gentleman refer to the steps leading to the consummation of the contract, or does he refer to the contract itself?

Mr. Ople: The 'transactions' used here, I suppose is generic and therefore, it can cover both steps leading to a contract
and already a consummated contract, Mr. Presiding Officer.

Mr. Suarez: This contemplates inclusion of negotiations leading to the consummation of the transaction.

Mr. Ople: Yes, subject only to reasonable safeguards on the national interest.

Mr. Suarez: Thank you."32 (Emphasis supplied)

AMARI argues there must first be a consummated contract before petitioner can invoke the right. Requiring government officials to reveal
their deliberations at the pre-decisional stage will degrade the quality of decision-making in government agencies. Government officials will
hesitate to express their real sentiments during deliberations if there is immediate public dissemination of their discussions, putting them
under all kinds of pressure before they decide.

We must first distinguish between information the law on public bidding requires PEA to disclose publicly, and information the constitutional
right to information requires PEA to release to the public. Before the consummation of the contract, PEA must, on its own and without
demand from anyone, disclose to the public matters relating to the disposition of its property. These include the size, location, technical
description and nature of the property being disposed of, the terms and conditions of the disposition, the parties qualified to bid, the
minimum price and similar information. PEA must prepare all these data and disclose them to the public at the start of the disposition
process, long before the consummation of the contract, because the Government Auditing Code requires public bidding. If PEA fails to make
this disclosure, any citizen can demand from PEA this information at any time during the bidding process.

Information, however, on on-going evaluation or review of bids or proposals being undertaken by the bidding or review committee is not
immediately accessible under the right to information. While the evaluation or review is still on-going, there are no "official acts, transactions,
or decisions" on the bids or proposals. However, once the committee makes its official recommendation, there arises a "definite
proposition" on the part of the government. From this moment, the public's right to information attaches, and any citizen can access all the
non-proprietary information leading to such definite proposition. In Chavez v. PCGG,33 the Court ruled as follows:

"Considering the intent of the framers of the Constitution, we believe that it is incumbent upon the PCGG and its officers, as well as
other government representatives, to disclose sufficient public information on any proposed settlement they have decided to take up
with the ostensible owners and holders of ill-gotten wealth. Such information, though, must pertain to definite propositions of the
government, not necessarily to intra-agency or inter-agency recommendations or communications during the stage when common
assertions are still in the process of being formulated or are in the "exploratory" stage. There is need, of course, to observe the
same restrictions on disclosure of information in general, as discussed earlier – such as on matters involving national security,
diplomatic or foreign relations, intelligence and other classified information." (Emphasis supplied)

Contrary to AMARI's contention, the commissioners of the 1986 Constitutional Commission understood that the right to
information "contemplates inclusion of negotiations leading to the consummation of the transaction." Certainly, a consummated
contract is not a requirement for the exercise of the right to information. Otherwise, the people can never exercise the right if no contract is
consummated, and if one is consummated, it may be too late for the public to expose its defects.1âwphi1.nêt
Requiring a consummated contract will keep the public in the dark until the contract, which may be grossly disadvantageous to the
government or even illegal, becomes a fait accompli. This negates the State policy of full transparency on matters of public concern, a
situation which the framers of the Constitution could not have intended. Such a requirement will prevent the citizenry from participating in the
public discussion of any proposedcontract, effectively truncating a basic right enshrined in the Bill of Rights. We can allow neither an
emasculation of a constitutional right, nor a retreat by the State of its avowed "policy of full disclosure of all its transactions involving public
interest."

The right covers three categories of information which are "matters of public concern," namely: (1) official records; (2) documents and papers
pertaining to official acts, transactions and decisions; and (3) government research data used in formulating policies. The first category refers
to any document that is part of the public records in the custody of government agencies or officials. The second category refers to
documents and papers recording, evidencing, establishing, confirming, supporting, justifying or explaining official acts, transactions or
decisions of government agencies or officials. The third category refers to research data, whether raw, collated or processed, owned by the
government and used in formulating government policies.

The information that petitioner may access on the renegotiation of the JVA includes evaluation reports, recommendations, legal and expert
opinions, minutes of meetings, terms of reference and other documents attached to such reports or minutes, all relating to the JVA. However,
the right to information does not compel PEA to prepare lists, abstracts, summaries and the like relating to the renegotiation of the JVA.34 The
right only affords access to records, documents and papers, which means the opportunity to inspect and copy them. One who exercises the
right must copy the records, documents and papers at his expense. The exercise of the right is also subject to reasonable regulations to
protect the integrity of the public records and to minimize disruption to government operations, like rules specifying when and how to conduct
the inspection and copying.35

The right to information, however, does not extend to matters recognized as privileged information under the separation of powers.36 The
right does not also apply to information on military and diplomatic secrets, information affecting national security, and information on
investigations of crimes by law enforcement agencies before the prosecution of the accused, which courts have long recognized as
confidential.37 The right may also be subject to other limitations that Congress may impose by law.

There is no claim by PEA that the information demanded by petitioner is privileged information rooted in the separation of powers. The
information does not cover Presidential conversations, correspondences, or discussions during closed-door Cabinet meetings which, like
internal deliberations of the Supreme Court and other collegiate courts, or executive sessions of either house of Congress,38 are recognized as
confidential. This kind of information cannot be pried open by a co-equal branch of government. A frank exchange of exploratory ideas and
assessments, free from the glare of publicity and pressure by interested parties, is essential to protect the independence of decision-making
of those tasked to exercise Presidential, Legislative and Judicial power.39This is not the situation in the instant case.

We rule, therefore, that the constitutional right to information includes official information on on-going negotiations before a final contract.
The information, however, must constitute definite propositions by the government and should not cover recognized exceptions like privileged
information, military and diplomatic secrets and similar matters affecting national security and public order. 40 Congress has also prescribed
other limitations on the right to information in several legislations.41

Sixth issue: whether stipulations in the Amended JVA for the transfer to AMARI of lands, reclaimed or to be reclaimed, violate
the Constitution.

The Regalian Doctrine

The ownership of lands reclaimed from foreshore and submerged areas is rooted in the Regalian doctrine which holds that the State owns all
lands and waters of the public domain. Upon the Spanish conquest of the Philippines, ownership of all "lands, territories and possessions" in
the Philippines passed to the Spanish Crown.42The King, as the sovereign ruler and representative of the people, acquired and owned all lands
and territories in the Philippines except those he disposed of by grant or sale to private individuals.

The 1935, 1973 and 1987 Constitutions adopted the Regalian doctrine substituting, however, the State, in lieu of the King, as the owner of all
lands and waters of the public domain. The Regalian doctrine is the foundation of the time-honored principle of land ownership that "all lands
that were not acquired from the Government, either by purchase or by grant, belong to the public domain."43 Article 339 of the Civil Code of
1889, which is now Article 420 of the Civil Code of 1950, incorporated the Regalian doctrine.

Ownership and Disposition of Reclaimed Lands

The Spanish Law of Waters of 1866 was the first statutory law governing the ownership and disposition of reclaimed lands in the Philippines.
On May 18, 1907, the Philippine Commission enacted Act No. 1654 which provided for the lease, but not the sale, of reclaimed lands of
the government to corporations and individuals. Later, on November 29, 1919, the Philippine Legislature approved Act No. 2874, the
Public Land Act, which authorized the lease, but not the sale, of reclaimed lands of the government to corporations and individuals.
On November 7, 1936, the National Assembly passed Commonwealth Act No. 141, also known as the Public Land Act, which authorized the
lease, but not the sale, of reclaimed lands of the government to corporations and individuals. CA No. 141 continues to this day as
the general law governing the classification and disposition of lands of the public domain.

The Spanish Law of Waters of 1866 and the Civil Code of 1889

Under the Spanish Law of Waters of 1866, the shores, bays, coves, inlets and all waters within the maritime zone of the Spanish territory
belonged to the public domain for public use.44 The Spanish Law of Waters of 1866 allowed the reclamation of the sea under Article 5, which
provided as follows:

"Article 5. Lands reclaimed from the sea in consequence of works constructed by the State, or by the provinces, pueblos or private
persons, with proper permission, shall become the property of the party constructing such works, unless otherwise provided by the
terms of the grant of authority."

Under the Spanish Law of Waters, land reclaimed from the sea belonged to the party undertaking the reclamation, provided the government
issued the necessary permit and did not reserve ownership of the reclaimed land to the State.

Article 339 of the Civil Code of 1889 defined property of public dominion as follows:

"Art. 339. Property of public dominion is –

1. That devoted to public use, such as roads, canals, rivers, torrents, ports and bridges constructed by the State, riverbanks, shores,
roadsteads, and that of a similar character;
 2. That belonging exclusively to the State which, without being of general public use, is employed in some public service, or in the
development of the national wealth, such as walls, fortresses, and other works for the defense of the territory, and mines, until
granted to private individuals."

Property devoted to public use referred to property open for use by the public. In contrast, property devoted to public service referred to
property used for some specific public service and open only to those authorized to use the property.

Property of public dominion referred not only to property devoted to public use, but also to property not so used but employed to develop
the national wealth. This class of property constituted property of public dominion although employed for some economic or commercial
activity to increase the national wealth.

Article 341 of the Civil Code of 1889 governed the re-classification of property of public dominion into private property, to wit:

"Art. 341. Property of public dominion, when no longer devoted to public use or to the defense of the territory, shall become a part
of the private property of the State."

This provision, however, was not self-executing. The legislature, or the executive department pursuant to law, must declare the property no
longer needed for public use or territorial defense before the government could lease or alienate the property to private parties. 45

Act No. 1654 of the Philippine Commission

On May 8, 1907, the Philippine Commission enacted Act No. 1654 which regulated the lease of reclaimed and foreshore lands. The salient
provisions of this law were as follows:

"Section 1. The control and disposition of the foreshore as defined in existing law, and the title to all Government or public
lands made or reclaimed by the Government by dredging or filling or otherwise throughout the Philippine Islands, shall be
retained by the Government without prejudice to vested rights and without prejudice to rights conceded to the City of Manila in
the Luneta Extension.

Section 2. (a) The Secretary of the Interior shall cause all Government or public lands made or reclaimed by the Government by
dredging or filling or otherwise to be divided into lots or blocks, with the necessary streets and alleyways located thereon, and shall
cause plats and plans of such surveys to be prepared and filed with the Bureau of Lands.

(b) Upon completion of such plats and plans the Governor-General shall give notice to the public that such parts of the
lands so made or reclaimed as are not needed for public purposes will be leased for commercial and business
purposes, x x x.

xxx

(e) The leases above provided for shall be disposed of to the highest and best bidder therefore, subject to such regulations
and safeguards as the Governor-General may by executive order prescribe." (Emphasis supplied)

Act No. 1654 mandated that the government should retain title to all lands reclaimed by the government. The Act also vested in the
government control and disposition of foreshore lands. Private parties could lease lands reclaimed by the government only if these lands were
no longer needed for public purpose. Act No. 1654 mandated public bidding in the lease of government reclaimed lands. Act No. 1654 made
government reclaimed lands sui generis in that unlike other public lands which the government could sell to private parties, these reclaimed
lands were available only for lease to private parties.

Act No. 1654, however, did not repeal Section 5 of the Spanish Law of Waters of 1866. Act No. 1654 did not prohibit private parties from
reclaiming parts of the sea under Section 5 of the Spanish Law of Waters. Lands reclaimed from the sea by private parties with government
permission remained private lands.

Act No. 2874 of the Philippine Legislature

On November 29, 1919, the Philippine Legislature enacted Act No. 2874, the Public Land Act.46 The salient provisions of Act No. 2874, on
reclaimed lands, were as follows:

"Sec. 6. The Governor-General, upon the recommendation of the Secretary of Agriculture and Natural Resources, shall
from time to time classify the lands of the public domain into –

(a) Alienable or disposable,

(b) Timber, and

(c) Mineral lands, x x x.

Sec. 7. For the purposes of the government and disposition of alienable or disposable public lands, the Governor-General, upon
recommendation by the Secretary of Agriculture and Natural Resources, shall from time to time declare what lands are
open to disposition or concession under this Act."

Sec. 8. Only those lands shall be declared open to disposition or concession which have been officially delimited or
classified x x x.

xxx

Sec. 55. Any tract of land of the public domain which, being neither timber nor mineral land, shall be classified as suitable for
residential purposes or for commercial, industrial, or other productive purposes other than agricultural purposes, and
shall be open to disposition or concession, shall be disposed of under the provisions of this chapter, and not otherwise.

Sec. 56. The lands disposable under this title shall be classified as follows:

(a) Lands reclaimed by the Government by dredging, filling, or other means;

 (b) Foreshore;

(c) Marshy lands or lands covered with water bordering upon the shores or banks of navigable lakes or rivers;

(d) Lands not included in any of the foregoing classes.

x x x.

Sec. 58. The lands comprised in classes (a), (b), and (c) of section fifty-six shall be disposed of to private parties by
lease only and not otherwise, as soon as the Governor-General, upon recommendation by the Secretary of Agriculture
and Natural Resources, shall declare that the same are not necessary for the public service and are open to
disposition under this chapter. The lands included in class (d) may be disposed of by sale or lease under the provisions
of this Act." (Emphasis supplied)

Section 6 of Act No. 2874 authorized the Governor-General to "classify lands of the public domain into x x x alienable or disposable"47 lands.
Section 7 of the Act empowered the Governor-General to "declare what lands are open to disposition or concession." Section 8 of the Act
limited alienable or disposable lands only to those lands which have been "officially delimited and classified."

Section 56 of Act No. 2874 stated that lands "disposable under this title 48 shall be classified" as government reclaimed, foreshore and marshy
lands, as well as other lands. All these lands, however, must be suitable for residential, commercial, industrial or other productive non-
agricultural purposes. These provisions vested upon the Governor-General the power to classify inalienable lands of the public domain into
disposable lands of the public domain. These provisions also empowered the Governor-General to classify further such disposable lands of the
public domain into government reclaimed, foreshore or marshy lands of the public domain, as well as other non-agricultural lands.

Section 58 of Act No. 2874 categorically mandated that disposable lands of the public domain classified as government reclaimed, foreshore
and marshy lands "shall be disposed of to private parties by lease only and not otherwise." The Governor-General, before allowing
the lease of these lands to private parties, must formally declare that the lands were "not necessary for the public service." Act No. 2874
reiterated the State policy to lease and not to sell government reclaimed, foreshore and marshy lands of the public domain, a policy first
enunciated in 1907 in Act No. 1654. Government reclaimed, foreshore and marshy lands remained sui generis, as the only alienable or
disposable lands of the public domain that the government could not sell to private parties.

The rationale behind this State policy is obvious. Government reclaimed, foreshore and marshy public lands for non-agricultural purposes
retain their inherent potential as areas for public service. This is the reason the government prohibited the sale, and only allowed the lease, of
these lands to private parties. The State always reserved these lands for some future public service.

Act No. 2874 did not authorize the reclassification of government reclaimed, foreshore and marshy lands into other non-agricultural lands
under Section 56 (d). Lands falling under Section 56 (d) were the only lands for non-agricultural purposes the government could sell to
private parties. Thus, under Act No. 2874, the government could not sell government reclaimed, foreshore and marshy lands to private
parties, unless the legislature passed a law allowing their sale.49

Act No. 2874 did not prohibit private parties from reclaiming parts of the sea pursuant to Section 5 of the Spanish Law of Waters of 1866.
Lands reclaimed from the sea by private parties with government permission remained private lands.

Dispositions under the 1935 Constitution

On May 14, 1935, the 1935 Constitution took effect upon its ratification by the Filipino people. The 1935 Constitution, in adopting the
Regalian doctrine, declared in Section 1, Article XIII, that –

"Section 1. All agricultural, timber, and mineral lands of the public domain, waters, minerals, coal, petroleum, and other mineral
oils, all forces of potential energy and other natural resources of the Philippines belong to the State, and their disposition,
exploitation, development, or utilization shall be limited to citizens of the Philippines or to corporations or associations at least sixty
per centum of the capital of which is owned by such citizens, subject to any existing right, grant, lease, or concession at the time of
the inauguration of the Government established under this Constitution. Natural resources, with the exception of public
agricultural land, shall not be alienated, and no license, concession, or lease for the exploitation, development, or utilization of
any of the natural resources shall be granted for a period exceeding twenty-five years, renewable for another twenty-five years,
except as to water rights for irrigation, water supply, fisheries, or industrial uses other than the development of water power, in
which cases beneficial use may be the measure and limit of the grant." (Emphasis supplied)

The 1935 Constitution barred the alienation of all natural resources except public agricultural lands, which were the only natural resources the
State could alienate. Thus, foreshore lands, considered part of the State's natural resources, became inalienable by constitutional fiat,
available only for lease for 25 years, renewable for another 25 years. The government could alienate foreshore lands only after these lands
were reclaimed and classified as alienable agricultural lands of the public domain. Government reclaimed and marshy lands of the public
domain, being neither timber nor mineral lands, fell under the classification of public agricultural lands.50 However, government reclaimed and
marshy lands, although subject to classification as disposable public agricultural lands, could only be leased and not sold to private parties
because of Act No. 2874.

The prohibition on private parties from acquiring ownership of government reclaimed and marshy lands of the public domain was only a
statutory prohibition and the legislature could therefore remove such prohibition. The 1935 Constitution did not prohibit individuals and
corporations from acquiring government reclaimed and marshy lands of the public domain that were classified as agricultural lands under
existing public land laws. Section 2, Article XIII of the 1935 Constitution provided as follows:

"Section 2. No private corporation or association may acquire, lease, or hold public agricultural lands in excess of one
thousand and twenty four hectares, nor may any individual acquire such lands by purchase in excess of one hundred
and forty hectares, or by lease in excess of one thousand and twenty-four hectares, or by homestead in excess of twenty-
four hectares. Lands adapted to grazing, not exceeding two thousand hectares, may be leased to an individual, private corporation,
or association." (Emphasis supplied)

Still, after the effectivity of the 1935 Constitution, the legislature did not repeal Section 58 of Act No. 2874 to open for sale to private parties
government reclaimed and marshy lands of the public domain. On the contrary, the legislature continued the long established State policy of
retaining for the government title and ownership of government reclaimed and marshy lands of the public domain.

Commonwealth Act No. 141 of the Philippine National Assembly

On November 7, 1936, the National Assembly approved Commonwealth Act No. 141, also known as the Public Land Act, which compiled the
then existing laws on lands of the public domain. CA No. 141, as amended, remains to this day the existing general law governing the
classification and disposition of lands of the public domain other than timber and mineral lands.51
Section 6 of CA No. 141 empowers the President to classify lands of the public domain into "alienable or disposable" 52 lands of the public
domain, which prior to such classification are inalienable and outside the commerce of man. Section 7 of CA No. 141 authorizes the President
to "declare what lands are open to disposition or concession." Section 8 of CA No. 141 states that the government can declare open for
disposition or concession only lands that are "officially delimited and classified." Sections 6, 7 and 8 of CA No. 141 read as follows:

"Sec. 6. The President, upon the recommendation of the Secretary of Agriculture and Commerce, shall from time to
time classify the lands of the public domain into –

(a) Alienable or disposable,

(b) Timber, and

(c) Mineral lands,

and may at any time and in like manner transfer such lands from one class to another, 53 for the purpose of their administration and
disposition.

Sec. 7. For the purposes of the administration and disposition of alienable or disposable public lands, the President, upon
recommendation by the Secretary of Agriculture and Commerce, shall from time to time declare what lands are open to
disposition or concession under this Act.

Sec. 8. Only those lands shall be declared open to disposition or concession which have been officially delimited and
classified and, when practicable, surveyed, and which have not been reserved for public or quasi-public uses, nor
appropriated by the Government, nor in any manner become private property, nor those on which a private right authorized and
recognized by this Act or any other valid law may be claimed, or which, having been reserved or appropriated, have ceased to be so.
x x x."

Thus, before the government could alienate or dispose of lands of the public domain, the President must first officially classify these lands as
alienable or disposable, and then declare them open to disposition or concession. There must be no law reserving these lands for public or
quasi-public uses.

The salient provisions of CA No. 141, on government reclaimed, foreshore and marshy lands of the public domain, are as follows:

"Sec. 58. Any tract of land of the public domain which, being neither timber nor mineral land, is intended to be used for
residential purposes or for commercial, industrial, or other productive purposes other than agricultural, and is open to
disposition or concession, shall be disposed of under the provisions of this chapter and not otherwise.

Sec. 59. The lands disposable under this title shall be classified as follows:

(a) Lands reclaimed by the Government by dredging, filling, or other means;

(b) Foreshore;

(c) Marshy lands or lands covered with water bordering upon the shores or banks of navigable lakes or rivers;

(d) Lands not included in any of the foregoing classes.

Sec. 60. Any tract of land comprised under this title may be leased or sold, as the case may be, to any person, corporation, or
association authorized to purchase or lease public lands for agricultural purposes. x x x.

Sec. 61. The lands comprised in classes (a), (b), and (c) of section fifty-nine shall be disposed of to private parties by
lease only and not otherwise, as soon as the President, upon recommendation by the Secretary of Agriculture, shall declare
that the same are not necessary for the public service and are open to disposition under this chapter. The lands included in
class (d) may be disposed of by sale or lease under the provisions of this Act." (Emphasis supplied)

Section 61 of CA No. 141 readopted, after the effectivity of the 1935 Constitution, Section 58 of Act No. 2874 prohibiting the sale of
government reclaimed, foreshore and marshy disposable lands of the public domain. All these lands are intended for residential, commercial,
industrial or other non-agricultural purposes. As before, Section 61 allowed only the lease of such lands to private parties. The government
could sell to private parties only lands falling under Section 59 (d) of CA No. 141, or those lands for non-agricultural purposes not classified as
government reclaimed, foreshore and marshy disposable lands of the public domain. Foreshore lands, however, became inalienable under the
1935 Constitution which only allowed the lease of these lands to qualified private parties.

Section 58 of CA No. 141 expressly states that disposable lands of the public domain intended for residential, commercial, industrial or other
productive purposes other than agricultural "shall be disposed of under the provisions of this chapter and not otherwise." Under
Section 10 of CA No. 141, the term "disposition" includes lease of the land. Any disposition of government reclaimed, foreshore and marshy
disposable lands for non-agricultural purposes must comply with Chapter IX, Title III of CA No. 141,54 unless a subsequent law amended or
repealed these provisions.

In his concurring opinion in the landmark case of Republic Real Estate Corporation v. Court of Appeals,55Justice Reynato S. Puno
summarized succinctly the law on this matter, as follows:

"Foreshore lands are lands of public dominion intended for public use. So too are lands reclaimed by the government by dredging,
filling, or other means. Act 1654 mandated that the control and disposition of the foreshore and lands under water remained in the
national government. Said law allowed only the 'leasing' of reclaimed land. The Public Land Acts of 1919 and 1936 also declared that
the foreshore and lands reclaimed by the government were to be "disposed of to private parties by lease only and not otherwise."
Before leasing, however, the Governor-General, upon recommendation of the Secretary of Agriculture and Natural Resources, had
first to determine that the land reclaimed was not necessary for the public service. This requisite must have been met before the
land could be disposed of. But even then, the foreshore and lands under water were not to be alienated and sold to
private parties. The disposition of the reclaimed land was only by lease. The land remained property of the State."
(Emphasis supplied)

As observed by Justice Puno in his concurring opinion, "Commonwealth Act No. 141 has remained in effect at present."
The State policy prohibiting the sale to private parties of government reclaimed, foreshore and marshy alienable lands of the public domain,
first implemented in 1907 was thus reaffirmed in CA No. 141 after the 1935 Constitution took effect. The prohibition on the sale of foreshore
lands, however, became a constitutional edict under the 1935 Constitution. Foreshore lands became inalienable as natural resources of the
State, unless reclaimed by the government and classified as agricultural lands of the public domain, in which case they would fall under the
classification of government reclaimed lands.

After the effectivity of the 1935 Constitution, government reclaimed and marshy disposable lands of the public domain continued to be only
leased and not sold to private parties.56 These lands remained sui generis, as the only alienable or disposable lands of the public domain the
government could not sell to private parties.

Since then and until now, the only way the government can sell to private parties government reclaimed and marshy disposable lands of the
public domain is for the legislature to pass a law authorizing such sale. CA No. 141 does not authorize the President to reclassify government
reclaimed and marshy lands into other non-agricultural lands under Section 59 (d). Lands classified under Section 59 (d) are the only
alienable or disposable lands for non-agricultural purposes that the government could sell to private parties.

Moreover, Section 60 of CA No. 141 expressly requires congressional authority before lands under Section 59 that the government
previously transferred to government units or entities could be sold to private parties. Section 60 of CA No. 141 declares that –

"Sec. 60. x x x The area so leased or sold shall be such as shall, in the judgment of the Secretary of Agriculture and Natural
Resources, be reasonably necessary for the purposes for which such sale or lease is requested, and shall not exceed one hundred
and forty-four hectares: Provided, however, That this limitation shall not apply to grants, donations, or transfers made to a
province, municipality or branch or subdivision of the Government for the purposes deemed by said entities conducive to the public
interest;but the land so granted, donated, or transferred to a province, municipality or branch or subdivision of the
Government shall not be alienated, encumbered, or otherwise disposed of in a manner affecting its title, except when
authorized by Congress: x x x." (Emphasis supplied)

The congressional authority required in Section 60 of CA No. 141 mirrors the legislative authority required in Section 56 of Act No. 2874.

One reason for the congressional authority is that Section 60 of CA No. 141 exempted government units and entities from the maximum area
of public lands that could be acquired from the State. These government units and entities should not just turn around and sell these lands to
private parties in violation of constitutional or statutory limitations. Otherwise, the transfer of lands for non-agricultural purposes to
government units and entities could be used to circumvent constitutional limitations on ownership of alienable or disposable lands of the
public domain. In the same manner, such transfers could also be used to evade the statutory prohibition in CA No. 141 on the sale of
government reclaimed and marshy lands of the public domain to private parties. Section 60 of CA No. 141 constitutes by operation of law a
lien on these lands.57

In case of sale or lease of disposable lands of the public domain falling under Section 59 of CA No. 141, Sections 63 and 67 require a public
bidding. Sections 63 and 67 of CA No. 141 provide as follows:

"Sec. 63. Whenever it is decided that lands covered by this chapter are not needed for public purposes, the Director of Lands shall
ask the Secretary of Agriculture and Commerce (now the Secretary of Natural Resources) for authority to dispose of the same. Upon
receipt of such authority, the Director of Lands shall give notice by public advertisement in the same manner as in the case of leases
or sales of agricultural public land, x x x.

Sec. 67. The lease or sale shall be made by oral bidding; and adjudication shall be made to the highest bidder. x x x."
(Emphasis supplied)

Thus, CA No. 141 mandates the Government to put to public auction all leases or sales of alienable or disposable lands of the public domain.58

Like Act No. 1654 and Act No. 2874 before it, CA No. 141 did not repeal Section 5 of the Spanish Law of Waters of 1866. Private parties could
still reclaim portions of the sea with government permission. However, thereclaimed land could become private land only if classified
as alienable agricultural land of the public domain open to disposition under CA No. 141. The 1935 Constitution prohibited the alienation
of all natural resources except public agricultural lands.

The Civil Code of 1950

The Civil Code of 1950 readopted substantially the definition of property of public dominion found in the Civil Code of 1889. Articles 420 and
422 of the Civil Code of 1950 state that –

"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.

x x x.

Art. 422. Property of public dominion, when no longer intended for public use or for public service, shall form part of the patrimonial
property of the State."

Again, the government must formally declare that the property of public dominion is no longer needed for public use or public service, before
the same could be classified as patrimonial property of the State.59 In the case of government reclaimed and marshy lands of the public
domain, the declaration of their being disposable, as well as the manner of their disposition, is governed by the applicable provisions of CA
No. 141.

Like the Civil Code of 1889, the Civil Code of 1950 included as property of public dominion those properties of the State which, without being
for public use, are intended for public service or the "development of the national wealth." Thus, government reclaimed and marshy lands
of the State, even if not employed for public use or public service, if developed to enhance the national wealth, are classified as property of
public dominion.
Dispositions under the 1973 Constitution

The 1973 Constitution, which took effect on January 17, 1973, likewise adopted the Regalian doctrine. Section 8, Article XIV of the 1973
Constitution stated that –

"Sec. 8. All lands of the public domain, waters, minerals, coal, petroleum and other mineral oils, all forces of potential energy,
fisheries, wildlife, and other natural resources of the Philippines belong to the State. With the exception of agricultural,
industrial or commercial, residential, and resettlement lands of the public domain, natural resources shall not be
alienated, and no license, concession, or lease for the exploration, development, exploitation, or utilization of any of the natural
resources shall be granted for a period exceeding twenty-five years, renewable for not more than twenty-five years, except as to
water rights for irrigation, water supply, fisheries, or industrial uses other than the development of water power, in which cases,
beneficial use may be the measure and the limit of the grant." (Emphasis supplied)

The 1973 Constitution prohibited the alienation of all natural resources with the exception of "agricultural, industrial or commercial,
residential, and resettlement lands of the public domain." In contrast, the 1935 Constitution barred the alienation of all natural resources
except "public agricultural lands." However, the term "public agricultural lands" in the 1935 Constitution encompassed industrial, commercial,
residential and resettlement lands of the public domain.60 If the land of public domain were neither timber nor mineral land, it would fall
under the classification of agricultural land of the public domain. Both the 1935 and 1973 Constitutions, therefore, prohibited the
alienation of all natural resources except agricultural lands of the public domain.

The 1973 Constitution, however, limited the alienation of lands of the public domain to individuals who were citizens of the Philippines. Private
corporations, even if wholly owned by Philippine citizens, were no longer allowed to acquire alienable lands of the public domain unlike in the
1935 Constitution. Section 11, Article XIV of the 1973 Constitution declared that –

"Sec. 11. The Batasang Pambansa, taking into account conservation, ecological, and development requirements of the natural
resources, shall determine by law the size of land of the public domain which may be developed, held or acquired by, or leased to,
any qualified individual, corporation, or association, and the conditions therefor. No private corporation or association may hold
alienable lands of the public domain except by lease not to exceed one thousand hectares in area nor may any citizen hold
such lands by lease in excess of five hundred hectares or acquire by purchase, homestead or grant, in excess of twenty-four
hectares. No private corporation or association may hold by lease, concession, license or permit, timber or forest lands and other
timber or forest resources in excess of one hundred thousand hectares. However, such area may be increased by the Batasang
Pambansa upon recommendation of the National Economic and Development Authority." (Emphasis supplied)

Thus, under the 1973 Constitution, private corporations could hold alienable lands of the public domain only through lease. Only individuals
could now acquire alienable lands of the public domain, and private corporations became absolutely barred from acquiring any kind
of alienable land of the public domain. The constitutional ban extended to all kinds of alienable lands of the public domain, while the
statutory ban under CA No. 141 applied only to government reclaimed, foreshore and marshy alienable lands of the public domain.

PD No. 1084 Creating the Public Estates Authority

On February 4, 1977, then President Ferdinand Marcos issued Presidential Decree No. 1084 creating PEA, a wholly government owned and
controlled corporation with a special charter. Sections 4 and 8 of PD No. 1084, vests PEA with the following purposes and powers:

"Sec. 4. Purpose. The Authority is hereby created for the following purposes:

(a) To reclaim land, including foreshore and submerged areas, by dredging, filling or other means, or to acquire
reclaimed land;

(b) To develop, improve, acquire, administer, deal in, subdivide, dispose, lease and sell any and all kinds of lands, buildings,
estates and other forms of real property, owned, managed, controlled and/or operated by the government;

(c) To provide for, operate or administer such service as may be necessary for the efficient, economical and beneficial utilization of
the above properties.

Sec. 5. Powers and functions of the Authority. The Authority shall, in carrying out the purposes for which it is created, have the
following powers and functions:

(a)To prescribe its by-laws.

xxx

(i) To hold lands of the public domain in excess of the area permitted to private corporations by statute.

(j) To reclaim lands and to construct work across, or otherwise, any stream, watercourse, canal, ditch, flume x x x.

xxx

(o) To perform such acts and exercise such functions as may be necessary for the attainment of the purposes and objectives herein
specified." (Emphasis supplied)

PD No. 1084 authorizes PEA to reclaim both foreshore and submerged areas of the public domain. Foreshore areas are those covered and
uncovered by the ebb and flow of the tide.61 Submerged areas are those permanently under water regardless of the ebb and flow of the
tide.62 Foreshore and submerged areas indisputably belong to the public domain63 and are inalienable unless reclaimed, classified as alienable
lands open to disposition, and further declared no longer needed for public service.

The ban in the 1973 Constitution on private corporations from acquiring alienable lands of the public domain did not apply to PEA since it was
then, and until today, a fully owned government corporation. The constitutional ban applied then, as it still applies now, only to "private
corporations and associations." PD No. 1084 expressly empowers PEA "to hold lands of the public domain" even "in excess of the area
permitted to private corporations by statute." Thus, PEA can hold title to private lands, as well as title to lands of the public domain.

In order for PEA to sell its reclaimed foreshore and submerged alienable lands of the public domain, there must be legislative authority
empowering PEA to sell these lands. This legislative authority is necessary in view of Section 60 of CA No.141, which states –
 "Sec. 60. x x x; but the land so granted, donated or transferred to a province, municipality, or branch or subdivision of the
Government shall not be alienated, encumbered or otherwise disposed of in a manner affecting its title, except when authorized
by Congress; x x x." (Emphasis supplied)

Without such legislative authority, PEA could not sell but only lease its reclaimed foreshore and submerged alienable lands of the public
domain. Nevertheless, any legislative authority granted to PEA to sell its reclaimed alienable lands of the public domain would be subject to
the constitutional ban on private corporations from acquiring alienable lands of the public domain. Hence, such legislative authority could only
benefit private individuals.

Dispositions under the 1987 Constitution

The 1987 Constitution, like the 1935 and 1973 Constitutions before it, has adopted the Regalian doctrine. The 1987 Constitution declares that
all natural resources are "owned by the State," and except for alienable agricultural lands of the public domain, natural resources cannot be
alienated. Sections 2 and 3, Article XII of the 1987 Constitution state that –

"Section 2. All lands of the public domain, waters, minerals, coal, petroleum and other mineral oils, all forces of potential energy,
fisheries, forests or timber, wildlife, flora and fauna, and other natural resources are owned by the State. With the exception
of agricultural lands, all other natural resources shall not be alienated. The exploration, development, and utilization of
natural resources shall be under the full control and supervision of the State. x x x.

Section 3. Lands of the public domain are classified into agricultural, forest or timber, mineral lands, and national parks. Agricultural
lands of the public domain may be further classified by law according to the uses which they may be devoted. Alienable lands of
the public domain shall be limited to agricultural lands. Private corporations or associations may not hold such
alienable lands of the public domain except by lease, for a period not exceeding twenty-five years, renewable for not
more than twenty-five years, and not to exceed one thousand hectares in area. Citizens of the Philippines may lease not
more than five hundred hectares, or acquire not more than twelve hectares thereof by purchase, homestead, or grant.

Taking into account the requirements of conservation, ecology, and development, and subject to the requirements of agrarian
reform, the Congress shall determine, by law, the size of lands of the public domain which may be acquired, developed, held, or
leased and the conditions therefor." (Emphasis supplied)

The 1987 Constitution continues the State policy in the 1973 Constitution banning private corporations fromacquiring any kind of alienable
land of the public domain. Like the 1973 Constitution, the 1987 Constitution allows private corporations to hold alienable lands of the
public domain only through lease. As in the 1935 and 1973 Constitutions, the general law governing the lease to private corporations of
reclaimed, foreshore and marshy alienable lands of the public domain is still CA No. 141.

The Rationale behind the Constitutional Ban

The rationale behind the constitutional ban on corporations from acquiring, except through lease, alienable lands of the public domain is not
well understood. During the deliberations of the 1986 Constitutional Commission, the commissioners probed the rationale behind this ban,
thus:

"FR. BERNAS: Mr. Vice-President, my questions have reference to page 3, line 5 which says:

`No private corporation or association may hold alienable lands of the public domain except by lease, not to exceed one thousand
hectares in area.'

If we recall, this provision did not exist under the 1935 Constitution, but this was introduced in the 1973 Constitution. In effect, it
prohibits private corporations from acquiring alienable public lands. But it has not been very clear in jurisprudence what the
reason for this is. In some of the cases decided in 1982 and 1983, it was indicated that the purpose of this is to prevent
large landholdings. Is that the intent of this provision?

MR. VILLEGAS: I think that is the spirit of the provision.

FR. BERNAS: In existing decisions involving the Iglesia ni Cristo, there were instances where the Iglesia ni Cristo was not allowed to
acquire a mere 313-square meter land where a chapel stood because the Supreme Court said it would be in violation of this."
(Emphasis supplied)

In Ayog v. Cusi,64 the Court explained the rationale behind this constitutional ban in this way:

"Indeed, one purpose of the constitutional prohibition against purchases of public agricultural lands by private corporations is to
equitably diffuse land ownership or to encourage 'owner-cultivatorship and the economic family-size farm' and to prevent a
recurrence of cases like the instant case. Huge landholdings by corporations or private persons had spawned social unrest."

However, if the constitutional intent is to prevent huge landholdings, the Constitution could have simply limited the size of alienable lands of
the public domain that corporations could acquire. The Constitution could have followed the limitations on individuals, who could acquire not
more than 24 hectares of alienable lands of the public domain under the 1973 Constitution, and not more than 12 hectares under the 1987
Constitution.

If the constitutional intent is to encourage economic family-size farms, placing the land in the name of a corporation would be more effective
in preventing the break-up of farmlands. If the farmland is registered in the name of a corporation, upon the death of the owner, his heirs
would inherit shares in the corporation instead of subdivided parcels of the farmland. This would prevent the continuing break-up of farmlands
into smaller and smaller plots from one generation to the next.

In actual practice, the constitutional ban strengthens the constitutional limitation on individuals from acquiring more than the allowed area of
alienable lands of the public domain. Without the constitutional ban, individuals who already acquired the maximum area of alienable lands of
the public domain could easily set up corporations to acquire more alienable public lands. An individual could own as many corporations as his
means would allow him. An individual could even hide his ownership of a corporation by putting his nominees as stockholders of the
corporation. The corporation is a convenient vehicle to circumvent the constitutional limitation on acquisition by individuals of alienable lands
of the public domain.

The constitutional intent, under the 1973 and 1987 Constitutions, is to transfer ownership of only a limited area of alienable land of the public
domain to a qualified individual. This constitutional intent is safeguarded by the provision prohibiting corporations from acquiring alienable
lands of the public domain, since the vehicle to circumvent the constitutional intent is removed. The available alienable public lands are
gradually decreasing in the face of an ever-growing population. The most effective way to insure faithful adherence to this constitutional
intent is to grant or sell alienable lands of the public domain only to individuals. This, it would seem, is the practical benefit arising from the
constitutional ban.

The Amended Joint Venture Agreement

The subject matter of the Amended JVA, as stated in its second Whereas clause, consists of three properties, namely:

1. "[T]hree partially reclaimed and substantially eroded islands along Emilio Aguinaldo Boulevard in Paranaque and Las Pinas, Metro
Manila, with a combined titled area of 1,578,441 square meters;"

2. "[A]nother area of 2,421,559 square meters contiguous to the three islands;" and

3. "[A]t AMARI's option as approved by PEA, an additional 350 hectares more or less to regularize the configuration of the reclaimed
area."65

PEA confirms that the Amended JVA involves "the development of the Freedom Islands and further reclamation of about 250 hectares x x x,"
plus an option "granted to AMARI to subsequently reclaim another 350 hectares x x x."66

In short, the Amended JVA covers a reclamation area of 750 hectares. Only 157.84 hectares of the 750-hectare reclamation project
have been reclaimed, and the rest of the 592.15 hectares are still submerged areas forming part of Manila Bay.

Under the Amended JVA, AMARI will reimburse PEA the sum of P1,894,129,200.00 for PEA's "actual cost" in partially reclaiming the Freedom
Islands. AMARI will also complete, at its own expense, the reclamation of the Freedom Islands. AMARI will further shoulder all the reclamation
costs of all the other areas, totaling 592.15 hectares, still to be reclaimed. AMARI and PEA will share, in the proportion of 70 percent and 30
percent, respectively, the total net usable area which is defined in the Amended JVA as the total reclaimed area less 30 percent earmarked for
common areas. Title to AMARI's share in the net usable area, totaling 367.5 hectares, will be issued in the name of AMARI. Section 5.2 (c) of
the Amended JVA provides that –

"x x x, PEA shall have the duty to execute without delay the necessary deed of transfer or conveyance of the title pertaining to
AMARI's Land share based on the Land Allocation Plan. PEA, when requested in writing by AMARI, shall then cause the
issuance and delivery of the proper certificates of title covering AMARI's Land Share in the name of AMARI, x x x;
provided, that if more than seventy percent (70%) of the titled area at any given time pertains to AMARI, PEA shall deliver to AMARI
only seventy percent (70%) of the titles pertaining to AMARI, until such time when a corresponding proportionate area of additional
land pertaining to PEA has been titled." (Emphasis supplied)

Indisputably, under the Amended JVA AMARI will acquire and own a maximum of 367.5 hectares of reclaimed land which will
be titled in its name.

To implement the Amended JVA, PEA delegated to the unincorporated PEA-AMARI joint venture PEA's statutory authority, rights and
privileges to reclaim foreshore and submerged areas in Manila Bay. Section 3.2.a of the Amended JVA states that –

"PEA hereby contributes to the joint venture its rights and privileges to perform Rawland Reclamation and Horizontal Development
as well as own the Reclamation Area, thereby granting the Joint Venture the full and exclusive right, authority and privilege to
undertake the Project in accordance with the Master Development Plan."

The Amended JVA is the product of a renegotiation of the original JVA dated April 25, 1995 and its supplemental agreement dated August 9,
1995.

The Threshold Issue

The threshold issue is whether AMARI, a private corporation, can acquire and own under the Amended JVA 367.5 hectares of reclaimed
foreshore and submerged areas in Manila Bay in view of Sections 2 and 3, Article XII of the 1987 Constitution which state that:

"Section 2. All lands of the public domain, waters, minerals, coal, petroleum, and other mineral oils, all forces of potential energy,
fisheries, forests or timber, wildlife, flora and fauna, and other natural resources are owned by the State. With the exception of
agricultural lands, all other natural resources shall not be alienated. x x x.

xxx

Section 3. x x x Alienable lands of the public domain shall be limited to agricultural lands. Private corporations or associations
may not hold such alienable lands of the public domain except by lease, x x x."(Emphasis supplied)

Classification of Reclaimed Foreshore and Submerged Areas

PEA readily concedes that lands reclaimed from foreshore or submerged areas of Manila Bay are alienable or disposable lands of the public
domain. In its Memorandum,67 PEA admits that –

"Under the Public Land Act (CA 141, as amended), reclaimed lands are classified as alienable and disposable lands of the
public domain:

'Sec. 59. The lands disposable under this title shall be classified as follows:

(a) Lands reclaimed by the government by dredging, filling, or other means;

x x x.'" (Emphasis supplied)

Likewise, the Legal Task Force68 constituted under Presidential Administrative Order No. 365 admitted in its Report and Recommendation to
then President Fidel V. Ramos, "[R]eclaimed lands are classified as alienable and disposable lands of the public domain."69 The
Legal Task Force concluded that –

"D. Conclusion
 Reclaimed lands are lands of the public domain. However, by statutory authority, the rights of ownership and disposition over
reclaimed lands have been transferred to PEA, by virtue of which PEA, as owner, may validly convey the same to any qualified
person without violating the Constitution or any statute.

The constitutional provision prohibiting private corporations from holding public land, except by lease (Sec. 3, Art. XVII, 70 1987
Constitution), does not apply to reclaimed lands whose ownership has passed on to PEA by statutory grant."

Under Section 2, Article XII of the 1987 Constitution, the foreshore and submerged areas of Manila Bay are part of the "lands of the public
domain, waters x x x and other natural resources" and consequently "owned by the State." As such, foreshore and submerged areas "shall
not be alienated," unless they are classified as "agricultural lands" of the public domain. The mere reclamation of these areas by PEA does not
convert these inalienable natural resources of the State into alienable or disposable lands of the public domain. There must be a law or
presidential proclamation officially classifying these reclaimed lands as alienable or disposable and open to disposition or concession.
Moreover, these reclaimed lands cannot be classified as alienable or disposable if the law has reserved them for some public or quasi-public
use.71

Section 8 of CA No. 141 provides that "only those lands shall be declared open to disposition or concession which have been officially
delimited and classified."72 The President has the authority to classify inalienable lands of the public domain into alienable or disposable
lands of the public domain, pursuant to Section 6 of CA No. 141. In Laurel vs. Garcia,73 the Executive Department attempted to sell the
Roppongi property in Tokyo, Japan, which was acquired by the Philippine Government for use as the Chancery of the Philippine Embassy.
Although the Chancery had transferred to another location thirteen years earlier, the Court still ruled that, under Article 42274of the Civil
Code, a property of public dominion retains such character until formally declared otherwise. The Court ruled that –

"The fact that the Roppongi site has not been used for a long time for actual Embassy service does not automatically convert it to
patrimonial property. Any such conversion happens only if the property is withdrawn from public use (Cebu Oxygen and Acetylene
Co. v. Bercilles, 66 SCRA 481 [1975]. A property continues to be part of the public domain, not available for private
appropriation or ownership 'until there is a formal declaration on the part of the government to withdraw it from being
such'(Ignacio v. Director of Lands, 108 Phil. 335 [1960]." (Emphasis supplied)

PD No. 1085, issued on February 4, 1977, authorized the issuance of special land patents for lands reclaimed by PEA from the foreshore or
submerged areas of Manila Bay. On January 19, 1988 then President Corazon C. Aquino issued Special Patent No. 3517 in the name of PEA
for the 157.84 hectares comprising the partially reclaimed Freedom Islands. Subsequently, on April 9, 1999 the Register of Deeds of the
Municipality of Paranaque issued TCT Nos. 7309, 7311 and 7312 in the name of PEA pursuant to Section 103 of PD No. 1529 authorizing the
issuance of certificates of title corresponding to land patents. To this day, these certificates of title are still in the name of PEA.

PD No. 1085, coupled with President Aquino's actual issuance of a special patent covering the Freedom Islands, is equivalent to an official
proclamation classifying the Freedom Islands as alienable or disposable lands of the public domain. PD No. 1085 and President Aquino's
issuance of a land patent also constitute a declaration that the Freedom Islands are no longer needed for public service. The Freedom
Islands are thus alienable or disposable lands of the public domain, open to disposition or concession to qualified parties.

At the time then President Aquino issued Special Patent No. 3517, PEA had already reclaimed the Freedom Islands although subsequently
there were partial erosions on some areas. The government had also completed the necessary surveys on these islands. Thus, the Freedom
Islands were no longer part of Manila Bay but part of the land mass. Section 3, Article XII of the 1987 Constitution classifies lands of the
public domain into "agricultural, forest or timber, mineral lands, and national parks." Being neither timber, mineral, nor national park lands,
the reclaimed Freedom Islands necessarily fall under the classification of agricultural lands of the public domain. Under the 1987 Constitution,
agricultural lands of the public domain are the only natural resources that the State may alienate to qualified private parties. All other natural
resources, such as the seas or bays, are "waters x x x owned by the State" forming part of the public domain, and are inalienable pursuant to
Section 2, Article XII of the 1987 Constitution.

AMARI claims that the Freedom Islands are private lands because CDCP, then a private corporation, reclaimed the islands under a contract
dated November 20, 1973 with the Commissioner of Public Highways. AMARI, citing Article 5 of the Spanish Law of Waters of 1866, argues
that "if the ownership of reclaimed lands may be given to the party constructing the works, then it cannot be said that reclaimed lands are
lands of the public domain which the State may not alienate."75 Article 5 of the Spanish Law of Waters reads as follows:

"Article 5. Lands reclaimed from the sea in consequence of works constructed by the State, or by the provinces, pueblos or private
persons, with proper permission, shall become the property of the party constructing such works, unless otherwise provided by
the terms of the grant of authority." (Emphasis supplied)

Under Article 5 of the Spanish Law of Waters of 1866, private parties could reclaim from the sea only with "proper permission" from the State.
Private parties could own the reclaimed land only if not "otherwise provided by the terms of the grant of authority." This clearly meant that no
one could reclaim from the sea without permission from the State because the sea is property of public dominion. It also meant that the State
could grant or withhold ownership of the reclaimed land because any reclaimed land, like the sea from which it emerged, belonged to the
State. Thus, a private person reclaiming from the sea without permission from the State could not acquire ownership of the reclaimed land
which would remain property of public dominion like the sea it replaced. 76 Article 5 of the Spanish Law of Waters of 1866 adopted the time-
honored principle of land ownership that "all lands that were not acquired from the government, either by purchase or by grant, belong to the
public domain."77

Article 5 of the Spanish Law of Waters must be read together with laws subsequently enacted on the disposition of public lands. In particular,
CA No. 141 requires that lands of the public domain must first be classified as alienable or disposable before the government can alienate
them. These lands must not be reserved for public or quasi-public purposes.78 Moreover, the contract between CDCP and the government was
executed after the effectivity of the 1973 Constitution which barred private corporations from acquiring any kind of alienable land of the
public domain. This contract could not have converted the Freedom Islands into private lands of a private corporation.

Presidential Decree No. 3-A, issued on January 11, 1973, revoked all laws authorizing the reclamation of areas under water and revested
solely in the National Government the power to reclaim lands. Section 1 of PD No. 3-A declared that –

"The provisions of any law to the contrary notwithstanding, the reclamation of areas under water, whether foreshore or
inland, shall be limited to the National Government or any person authorized by it under a proper contract. (Emphasis
supplied)

x x x."

PD No. 3-A repealed Section 5 of the Spanish Law of Waters of 1866 because reclamation of areas under water could now be undertaken only
by the National Government or by a person contracted by the National Government. Private parties may reclaim from the sea only under a
contract with the National Government, and no longer by grant or permission as provided in Section 5 of the Spanish Law of Waters of 1866.

Executive Order No. 525, issued on February 14, 1979, designated PEA as the National Government's implementing arm to undertake "all
reclamation projects of the government," which "shall be undertaken by the PEA or through a proper contract executed by it with
any person or entity." Under such contract, a private party receives compensation for reclamation services rendered to PEA. Payment to the
contractor may be in cash, or in kind consisting of portions of the reclaimed land, subject to the constitutional ban on private corporations
from acquiring alienable lands of the public domain. The reclaimed land can be used as payment in kind only if the reclaimed land is first
classified as alienable or disposable land open to disposition, and then declared no longer needed for public service.

The Amended JVA covers not only the Freedom Islands, but also an additional 592.15 hectares which are still submerged and forming part of
Manila Bay. There is no legislative or Presidential act classifying these submerged areas as alienable or disposable lands of the
public domain open to disposition. These submerged areas are not covered by any patent or certificate of title. There can be no dispute
that these submerged areas form part of the public domain, and in their present state are inalienable and outside the commerce of man.
Until reclaimed from the sea, these submerged areas are, under the Constitution, "waters x x x owned by the State," forming part of the
public domain and consequently inalienable. Only when actually reclaimed from the sea can these submerged areas be classified as public
agricultural lands, which under the Constitution are the only natural resources that the State may alienate. Once reclaimed and transformed
into public agricultural lands, the government may then officially classify these lands as alienable or disposable lands open to disposition.
Thereafter, the government may declare these lands no longer needed for public service. Only then can these reclaimed lands be considered
alienable or disposable lands of the public domain and within the commerce of man.

The classification of PEA's reclaimed foreshore and submerged lands into alienable or disposable lands open to disposition is necessary
because PEA is tasked under its charter to undertake public services that require the use of lands of the public domain. Under Section 5 of PD
No. 1084, the functions of PEA include the following: "[T]o own or operate railroads, tramways and other kinds of land transportation, x x x;
[T]o construct, maintain and operate such systems of sanitary sewers as may be necessary; [T]o construct, maintain and operate such storm
drains as may be necessary." PEA is empowered to issue "rules and regulations as may be necessary for the proper use by private parties
of any or all of the highways, roads, utilities, buildings and/or any of its properties and to impose or collect fees or tolls for their
use." Thus, part of the reclaimed foreshore and submerged lands held by the PEA would actually be needed for public use or service since
many of the functions imposed on PEA by its charter constitute essential public services.

Moreover, Section 1 of Executive Order No. 525 provides that PEA "shall be primarily responsible for integrating, directing, and coordinating
all reclamation projects for and on behalf of the National Government." The same section also states that "[A]ll reclamation projects shall be
approved by the President upon recommendation of the PEA, and shall be undertaken by the PEA or through a proper contract executed by it
with any person or entity; x x x." Thus, under EO No. 525, in relation to PD No. 3-A and PD No.1084, PEA became the primary implementing
agency of the National Government to reclaim foreshore and submerged lands of the public domain. EO No. 525 recognized PEA as the
government entity "to undertake the reclamation of lands and ensure their maximum utilization in promoting public welfare and
interests."79 Since large portions of these reclaimed lands would obviously be needed for public service, there must be a formal declaration
segregating reclaimed lands no longer needed for public service from those still needed for public service.1âwphi1.nêt

Section 3 of EO No. 525, by declaring that all lands reclaimed by PEA "shall belong to or be owned by the PEA," could not automatically
operate to classify inalienable lands into alienable or disposable lands of the public domain. Otherwise, reclaimed foreshore and submerged
lands of the public domain would automatically become alienable once reclaimed by PEA, whether or not classified as alienable or disposable.

The Revised Administrative Code of 1987, a later law than either PD No. 1084 or EO No. 525, vests in the Department of Environment and
Natural Resources ("DENR" for brevity) the following powers and functions:

"Sec. 4. Powers and Functions. The Department shall:

(1) x x x

xxx

(4) Exercise supervision and control over forest lands, alienable and disposable public lands, mineral resources and, in the
process of exercising such control, impose appropriate taxes, fees, charges, rentals and any such form of levy and collect such
revenues for the exploration, development, utilization or gathering of such resources;

xxx

(14) Promulgate rules, regulations and guidelines on the issuance of licenses, permits, concessions, lease agreements
and such other privileges concerning the development, exploration and utilization of the country's marine, freshwater,
and brackish water and over all aquatic resources of the country and shall continue to oversee, supervise and police
our natural resources; cancel or cause to cancel such privileges upon failure, non-compliance or violations of any regulation,
order, and for all other causes which are in furtherance of the conservation of natural resources and supportive of the national
interest;

(15) Exercise exclusive jurisdiction on the management and disposition of all lands of the public domain and serve as
the sole agency responsible for classification, sub-classification, surveying and titling of lands in consultation with appropriate
agencies."80 (Emphasis supplied)

As manager, conservator and overseer of the natural resources of the State, DENR exercises "supervision and control over alienable and
disposable public lands." DENR also exercises "exclusive jurisdiction on the management and disposition of all lands of the public domain."
Thus, DENR decides whether areas under water, like foreshore or submerged areas of Manila Bay, should be reclaimed or not. This means
that PEA needs authorization from DENR before PEA can undertake reclamation projects in Manila Bay, or in any part of the country.

DENR also exercises exclusive jurisdiction over the disposition of all lands of the public domain. Hence, DENR decides whether reclaimed lands
of PEA should be classified as alienable under Sections 681 and 782 of CA No. 141. Once DENR decides that the reclaimed lands should be so
classified, it then recommends to the President the issuance of a proclamation classifying the lands as alienable or disposable lands of the
public domain open to disposition. We note that then DENR Secretary Fulgencio S. Factoran, Jr. countersigned Special Patent No. 3517 in
compliance with the Revised Administrative Code and Sections 6 and 7 of CA No. 141.

In short, DENR is vested with the power to authorize the reclamation of areas under water, while PEA is vested with the power to undertake
the physical reclamation of areas under water, whether directly or through private contractors. DENR is also empowered to classify lands of
the public domain into alienable or disposable lands subject to the approval of the President. On the other hand, PEA is tasked to develop, sell
or lease the reclaimed alienable lands of the public domain.

Clearly, the mere physical act of reclamation by PEA of foreshore or submerged areas does not make the reclaimed lands alienable or
disposable lands of the public domain, much less patrimonial lands of PEA. Likewise, the mere transfer by the National Government of lands
of the public domain to PEA does not make the lands alienable or disposable lands of the public domain, much less patrimonial lands of PEA.

Absent two official acts – a classification that these lands are alienable or disposable and open to disposition and a declaration that these
lands are not needed for public service, lands reclaimed by PEA remain inalienable lands of the public domain. Only such an official
classification and formal declaration can convert reclaimed lands into alienable or disposable lands of the public domain, open to disposition
under the Constitution, Title I and Title III83of CA No. 141 and other applicable laws.84
PEA's Authority to Sell Reclaimed Lands

PEA, like the Legal Task Force, argues that as alienable or disposable lands of the public domain, the reclaimed lands shall be disposed of in
accordance with CA No. 141, the Public Land Act. PEA, citing Section 60 of CA No. 141, admits that reclaimed lands transferred to a branch or
subdivision of the government "shall not be alienated, encumbered, or otherwise disposed of in a manner affecting its title, except when
authorized by Congress: x x x."85 (Emphasis by PEA)

In Laurel vs. Garcia,86 the Court cited Section 48 of the Revised Administrative Code of 1987, which states that –

"Sec. 48. Official Authorized to Convey Real Property. Whenever real property of the Government is authorized by law to be
conveyed, the deed of conveyance shall be executed in behalf of the government by the following: x x x."

Thus, the Court concluded that a law is needed to convey any real property belonging to the Government. The Court declared that -

"It is not for the President to convey real property of the government on his or her own sole will. Any such conveyance must be
authorized and approved by a law enacted by the Congress. It requires executive and legislative concurrence." (Emphasis
supplied)

PEA contends that PD No. 1085 and EO No. 525 constitute the legislative authority allowing PEA to sell its reclaimed lands. PD No. 1085,
issued on February 4, 1977, provides that –

"The land reclaimed in the foreshore and offshore area of Manila Bay pursuant to the contract for the reclamation and
construction of the Manila-Cavite Coastal Road Project between the Republic of the Philippines and the Construction and
Development Corporation of the Philippines dated November 20, 1973 and/or any other contract or reclamation covering the same
area is hereby transferred, conveyed and assigned to the ownership and administration of the Public Estates
Authority established pursuant to PD No. 1084; Provided, however, That the rights and interests of the Construction and
Development Corporation of the Philippines pursuant to the aforesaid contract shall be recognized and respected.

Henceforth, the Public Estates Authority shall exercise the rights and assume the obligations of the Republic of the Philippines
(Department of Public Highways) arising from, or incident to, the aforesaid contract between the Republic of the Philippines and the
Construction and Development Corporation of the Philippines.

In consideration of the foregoing transfer and assignment, the Public Estates Authority shall issue in favor of the Republic of the
Philippines the corresponding shares of stock in said entity with an issued value of said shares of stock (which) shall be deemed fully
paid and non-assessable.

The Secretary of Public Highways and the General Manager of the Public Estates Authority shall execute such contracts or
agreements, including appropriate agreements with the Construction and Development Corporation of the Philippines, as may be
necessary to implement the above.

Special land patent/patents shall be issued by the Secretary of Natural Resources in favor of the Public Estates
Authority without prejudice to the subsequent transfer to the contractor or his assignees of such portion or portions of
the land reclaimed or to be reclaimed as provided for in the above-mentioned contract. On the basis of such patents,
the Land Registration Commission shall issue the corresponding certificate of title." (Emphasis supplied)

On the other hand, Section 3 of EO No. 525, issued on February 14, 1979, provides that -

"Sec. 3. All lands reclaimed by PEA shall belong to or be owned by the PEA which shall be responsible for its administration,
development, utilization or disposition in accordance with the provisions of Presidential Decree No. 1084. Any and all income that
the PEA may derive from the sale, lease or use of reclaimed lands shall be used in accordance with the provisions of Presidential
Decree No. 1084."

There is no express authority under either PD No. 1085 or EO No. 525 for PEA to sell its reclaimed lands. PD No. 1085 merely transferred
"ownership and administration" of lands reclaimed from Manila Bay to PEA, while EO No. 525 declared that lands reclaimed by PEA "shall
belong to or be owned by PEA." EO No. 525 expressly states that PEA should dispose of its reclaimed lands "in accordance with the provisions
of Presidential Decree No. 1084," the charter of PEA.

PEA's charter, however, expressly tasks PEA "to develop, improve, acquire, administer, deal in, subdivide, dispose, lease and sell any and all
kinds of lands x x x owned, managed, controlled and/or operated by the government."87 (Emphasis supplied) There is, therefore,
legislative authority granted to PEA to sell its lands, whether patrimonial or alienable lands of the public domain. PEA may sell to
private parties itspatrimonial properties in accordance with the PEA charter free from constitutional limitations. The constitutional ban on
private corporations from acquiring alienable lands of the public domain does not apply to the sale of PEA's patrimonial lands.

PEA may also sell its alienable or disposable lands of the public domain to private individuals since, with the legislative authority, there
is no longer any statutory prohibition against such sales and the constitutional ban does not apply to individuals. PEA, however, cannot sell
any of its alienable or disposable lands of the public domain to private corporations since Section 3, Article XII of the 1987 Constitution
expressly prohibits such sales. The legislative authority benefits only individuals. Private corporations remain barred from acquiring any kind
of alienable land of the public domain, including government reclaimed lands.

The provision in PD No. 1085 stating that portions of the reclaimed lands could be transferred by PEA to the "contractor or his assignees"
(Emphasis supplied) would not apply to private corporations but only to individuals because of the constitutional ban. Otherwise, the
provisions of PD No. 1085 would violate both the 1973 and 1987 Constitutions.

The requirement of public auction in the sale of reclaimed lands

Assuming the reclaimed lands of PEA are classified as alienable or disposable lands open to disposition, and further declared no longer needed
for public service, PEA would have to conduct a public bidding in selling or leasing these lands. PEA must observe the provisions of Sections
63 and 67 of CA No. 141 requiring public auction, in the absence of a law exempting PEA from holding a public auction. 88 Special Patent No.
3517 expressly states that the patent is issued by authority of the Constitution and PD No. 1084, "supplemented by Commonwealth Act No.
141, as amended." This is an acknowledgment that the provisions of CA No. 141 apply to the disposition of reclaimed alienable lands of the
public domain unless otherwise provided by law. Executive Order No. 654,89 which authorizes PEA "to determine the kind and manner of
payment for the transfer" of its assets and properties, does not exempt PEA from the requirement of public auction. EO No. 654 merely
authorizes PEA to decide the mode of payment, whether in kind and in installment, but does not authorize PEA to dispense with public
auction.
Moreover, under Section 79 of PD No. 1445, otherwise known as the Government Auditing Code, the government is required to sell valuable
government property through public bidding. Section 79 of PD No. 1445 mandates that –

"Section 79. When government property has become unserviceable for any cause, or is no longer needed, it shall, upon
application of the officer accountable therefor, be inspected by the head of the agency or his duly authorized representative in the
presence of the auditor concerned and, if found to be valueless or unsaleable, it may be destroyed in their presence. If found to be
valuable, it may be sold at public auction to the highest bidder under the supervision of the proper committee on award or
similar body in the presence of the auditor concerned or other authorized representative of the Commission, after advertising by
printed notice in the Official Gazette, or for not less than three consecutive days in any newspaper of general
circulation, or where the value of the property does not warrant the expense of publication, by notices posted for a like period in at
least three public places in the locality where the property is to be sold. In the event that the public auction fails, the property
may be sold at a private sale at such price as may be fixed by the same committee or body concerned and approved by
the Commission."

It is only when the public auction fails that a negotiated sale is allowed, in which case the Commission on Audit must approve the selling
price.90 The Commission on Audit implements Section 79 of the Government Auditing Code through Circular No. 89-29691 dated January 27,
1989. This circular emphasizes that government assets must be disposed of only through public auction, and a negotiated sale can be
resorted to only in case of "failure of public auction."

At the public auction sale, only Philippine citizens are qualified to bid for PEA's reclaimed foreshore and submerged alienable lands of the
public domain. Private corporations are barred from bidding at the auction sale of any kind of alienable land of the public domain.

PEA originally scheduled a public bidding for the Freedom Islands on December 10, 1991. PEA imposed a condition that the winning bidder
should reclaim another 250 hectares of submerged areas to regularize the shape of the Freedom Islands, under a 60-40 sharing of the
additional reclaimed areas in favor of the winning bidder.92 No one, however, submitted a bid. On December 23, 1994, the Government
Corporate Counsel advised PEA it could sell the Freedom Islands through negotiation, without need of another public bidding, because of the
failure of the public bidding on December 10, 1991.93

However, the original JVA dated April 25, 1995 covered not only the Freedom Islands and the additional 250 hectares still to be reclaimed, it
also granted an option to AMARI to reclaim another 350 hectares. The original JVA, a negotiated contract, enlarged the reclamation area
to 750 hectares.94 The failure of public bidding on December 10, 1991, involving only 407.84 hectares, 95 is not a valid justification for a
negotiated sale of 750 hectares, almost double the area publicly auctioned. Besides, the failure of public bidding happened on December 10,
1991, more than three years before the signing of the original JVA on April 25, 1995. The economic situation in the country had greatly
improved during the intervening period.

Reclamation under the BOT Law and the Local Government Code

The constitutional prohibition in Section 3, Article XII of the 1987 Constitution is absolute and clear: "Private corporations or associations may
not hold such alienable lands of the public domain except by lease, x x x." Even Republic Act No. 6957 ("BOT Law," for brevity), cited by PEA
and AMARI as legislative authority to sell reclaimed lands to private parties, recognizes the constitutional ban. Section 6 of RA No. 6957
states –

"Sec. 6. Repayment Scheme. - For the financing, construction, operation and maintenance of any infrastructure projects undertaken
through the build-operate-and-transfer arrangement or any of its variations pursuant to the provisions of this Act, the project
proponent x x x may likewise be repaid in the form of a share in the revenue of the project or other non-monetary payments, such
as, but not limited to, the grant of a portion or percentage of the reclaimed land, subject to the constitutional requirements
with respect to the ownership of the land: x x x." (Emphasis supplied)

A private corporation, even one that undertakes the physical reclamation of a government BOT project, cannot acquire reclaimed alienable
lands of the public domain in view of the constitutional ban.

Section 302 of the Local Government Code, also mentioned by PEA and AMARI, authorizes local governments in land reclamation projects to
pay the contractor or developer in kind consisting of a percentage of the reclaimed land, to wit:

"Section 302. Financing, Construction, Maintenance, Operation, and Management of Infrastructure Projects by the Private Sector. x
xx

xxx

In case of land reclamation or construction of industrial estates, the repayment plan may consist of the grant of a portion or
percentage of the reclaimed land or the industrial estate constructed."

Although Section 302 of the Local Government Code does not contain a proviso similar to that of the BOT Law, the constitutional restrictions
on land ownership automatically apply even though not expressly mentioned in the Local Government Code.

Thus, under either the BOT Law or the Local Government Code, the contractor or developer, if a corporate entity, can only be paid with
leaseholds on portions of the reclaimed land. If the contractor or developer is an individual, portions of the reclaimed land, not exceeding 12
hectares96 of non-agricultural lands, may be conveyed to him in ownership in view of the legislative authority allowing such conveyance. This
is the only way these provisions of the BOT Law and the Local Government Code can avoid a direct collision with Section 3, Article XII of the
1987 Constitution.

Registration of lands of the public domain

Finally, PEA theorizes that the "act of conveying the ownership of the reclaimed lands to public respondent PEA transformed such lands of the
public domain to private lands." This theory is echoed by AMARI which maintains that the "issuance of the special patent leading to the
eventual issuance of title takes the subject land away from the land of public domain and converts the property into patrimonial or private
property." In short, PEA and AMARI contend that with the issuance of Special Patent No. 3517 and the corresponding certificates of titles, the
157.84 hectares comprising the Freedom Islands have become private lands of PEA. In support of their theory, PEA and AMARI cite the
following rulings of the Court:

1. Sumail v. Judge of CFI of Cotabato,97 where the Court held –

"Once the patent was granted and the corresponding certificate of title was issued, the land ceased to be part of the public domain
and became private property over which the Director of Lands has neither control nor jurisdiction."

2. Lee Hong Hok v. David,98 where the Court declared -

 "After the registration and issuance of the certificate and duplicate certificate of title based on a public land patent, the land covered
thereby automatically comes under the operation of Republic Act 496 subject to all the safeguards provided therein."3. Heirs of
Gregorio Tengco v. Heirs of Jose Aliwalas,99 where the Court ruled -

"While the Director of Lands has the power to review homestead patents, he may do so only so long as the land remains part of the
public domain and continues to be under his exclusive control; but once the patent is registered and a certificate of title is issued,
the land ceases to be part of the public domain and becomes private property over which the Director of Lands has neither control
nor jurisdiction."

4. Manalo v. Intermediate Appellate Court,100 where the Court held –

"When the lots in dispute were certified as disposable on May 19, 1971, and free patents were issued covering the same in favor of
the private respondents, the said lots ceased to be part of the public domain and, therefore, the Director of Lands lost jurisdiction
over the same."

5.Republic v. Court of Appeals,101 where the Court stated –

"Proclamation No. 350, dated October 9, 1956, of President Magsaysay legally effected a land grant to the Mindanao Medical Center,
Bureau of Medical Services, Department of Health, of the whole lot, validly sufficient for initial registration under the Land
Registration Act. Such land grant is constitutive of a 'fee simple' title or absolute title in favor of petitioner Mindanao Medical Center.
Thus, Section 122 of the Act, which governs the registration of grants or patents involving public lands, provides that 'Whenever
public lands in the Philippine Islands belonging to the Government of the United States or to the Government of the Philippines are
alienated, granted or conveyed to persons or to public or private corporations, the same shall be brought forthwith under the
operation of this Act (Land Registration Act, Act 496) and shall become registered lands.'"

The first four cases cited involve petitions to cancel the land patents and the corresponding certificates of titlesissued to private parties.
These four cases uniformly hold that the Director of Lands has no jurisdiction over private lands or that upon issuance of the certificate of title
the land automatically comes under the Torrens System. The fifth case cited involves the registration under the Torrens System of a 12.8-
hectare public land granted by the National Government to Mindanao Medical Center, a government unit under the Department of Health. The
National Government transferred the 12.8-hectare public land to serve as the site for the hospital buildings and other facilities of Mindanao
Medical Center, which performed a public service. The Court affirmed the registration of the 12.8-hectare public land in the name of Mindanao
Medical Center under Section 122 of Act No. 496. This fifth case is an example of a public land being registered under Act No. 496 without the
land losing its character as a property of public dominion.

In the instant case, the only patent and certificates of title issued are those in the name of PEA, a wholly government owned corporation
performing public as well as proprietary functions. No patent or certificate of title has been issued to any private party. No one is asking the
Director of Lands to cancel PEA's patent or certificates of title. In fact, the thrust of the instant petition is that PEA's certificates of title should
remain with PEA, and the land covered by these certificates, being alienable lands of the public domain, should not be sold to a private
corporation.

Registration of land under Act No. 496 or PD No. 1529 does not vest in the registrant private or public ownership of the land. Registration is
not a mode of acquiring ownership but is merely evidence of ownership previously conferred by any of the recognized modes of acquiring
ownership. Registration does not give the registrant a better right than what the registrant had prior to the registration. 102 The registration of
lands of the public domain under the Torrens system, by itself, cannot convert public lands into private lands.103

Jurisprudence holding that upon the grant of the patent or issuance of the certificate of title the alienable land of the public domain
automatically becomes private land cannot apply to government units and entities like PEA. The transfer of the Freedom Islands to PEA was
made subject to the provisions of CA No. 141 as expressly stated in Special Patent No. 3517 issued by then President Aquino, to wit:

"NOW, THEREFORE, KNOW YE, that by authority of the Constitution of the Philippines and in conformity with the provisions of
Presidential Decree No. 1084, supplemented by Commonwealth Act No. 141, as amended, there are hereby granted and
conveyed unto the Public Estates Authority the aforesaid tracts of land containing a total area of one million nine hundred fifteen
thousand eight hundred ninety four (1,915,894) square meters; the technical description of which are hereto attached and made an
integral part hereof." (Emphasis supplied)

Thus, the provisions of CA No. 141 apply to the Freedom Islands on matters not covered by PD No. 1084. Section 60 of CA No. 141 prohibits,
"except when authorized by Congress," the sale of alienable lands of the public domain that are transferred to government units or entities.
Section 60 of CA No. 141 constitutes, under Section 44 of PD No. 1529, a "statutory lien affecting title" of the registered land even if not
annotated on the certificate of title.104 Alienable lands of the public domain held by government entities under Section 60 of CA No. 141
remain public lands because they cannot be alienated or encumbered unless Congress passes a law authorizing their disposition. Congress,
however, cannot authorize the sale to private corporations of reclaimed alienable lands of the public domain because of the constitutional ban.
Only individuals can benefit from such law.

The grant of legislative authority to sell public lands in accordance with Section 60 of CA No. 141 does not automatically convert alienable
lands of the public domain into private or patrimonial lands. The alienable lands of the public domain must be transferred to qualified private
parties, or to government entities not tasked to dispose of public lands, before these lands can become private or patrimonial lands.
Otherwise, the constitutional ban will become illusory if Congress can declare lands of the public domain as private or patrimonial lands in the
hands of a government agency tasked to dispose of public lands. This will allow private corporations to acquire directly from government
agencies limitless areas of lands which, prior to such law, are concededly public lands.

Under EO No. 525, PEA became the central implementing agency of the National Government to reclaim foreshore and submerged areas
of the public domain. Thus, EO No. 525 declares that –

"EXECUTIVE ORDER NO. 525

Designating the Public Estates Authority as the Agency Primarily Responsible for all Reclamation Projects

Whereas, there are several reclamation projects which are ongoing or being proposed to be undertaken in various parts of the
country which need to be evaluated for consistency with national programs;

Whereas, there is a need to give further institutional support to the Government's declared policy to provide for a coordinated,
economical and efficient reclamation of lands;

Whereas, Presidential Decree No. 3-A requires that all reclamation of areas shall be limited to the National Government or any
person authorized by it under proper contract;
 Whereas, a central authority is needed to act on behalf of the National Government which shall ensure a coordinated
and integrated approach in the reclamation of lands;

Whereas, Presidential Decree No. 1084 creates the Public Estates Authority as a government corporation to undertake
reclamation of lands and ensure their maximum utilization in promoting public welfare and interests; and

Whereas, Presidential Decree No. 1416 provides the President with continuing authority to reorganize the national government
including the transfer, abolition, or merger of functions and offices.

NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines, by virtue of the powers vested in me by the Constitution
and pursuant to Presidential Decree No. 1416, do hereby order and direct the following:

Section 1. The Public Estates Authority (PEA) shall be primarily responsible for integrating, directing, and coordinating
all reclamation projects for and on behalf of the National Government. All reclamation projects shall be approved by the
President upon recommendation of the PEA, and shall be undertaken by the PEA or through a proper contract executed by it with
any person or entity; Provided, that, reclamation projects of any national government agency or entity authorized under its charter
shall be undertaken in consultation with the PEA upon approval of the President.

x x x ."

As the central implementing agency tasked to undertake reclamation projects nationwide, with authority to sell reclaimed lands, PEA took the
place of DENR as the government agency charged with leasing or selling reclaimed lands of the public domain. The reclaimed lands being
leased or sold by PEA are not private lands, in the same manner that DENR, when it disposes of other alienable lands, does not dispose of
private lands but alienable lands of the public domain. Only when qualified private parties acquire these lands will the lands become private
lands. In the hands of the government agency tasked and authorized to dispose of alienable of disposable lands of the public
domain, these lands are still public, not private lands.

Furthermore, PEA's charter expressly states that PEA "shall hold lands of the public domain" as well as "any and all kinds of lands." PEA
can hold both lands of the public domain and private lands. Thus, the mere fact that alienable lands of the public domain like the Freedom
Islands are transferred to PEA and issued land patents or certificates of title in PEA's name does not automatically make such lands private.

To allow vast areas of reclaimed lands of the public domain to be transferred to PEA as private lands will sanction a gross violation of the
constitutional ban on private corporations from acquiring any kind of alienable land of the public domain. PEA will simply turn around, as PEA
has now done under the Amended JVA, and transfer several hundreds of hectares of these reclaimed and still to be reclaimed lands to a
single private corporation in only one transaction. This scheme will effectively nullify the constitutional ban in Section 3, Article XII of the
1987 Constitution which was intended to diffuse equitably the ownership of alienable lands of the public domain among Filipinos, now
numbering over 80 million strong.

This scheme, if allowed, can even be applied to alienable agricultural lands of the public domain since PEA can "acquire x x x any and all kinds
of lands." This will open the floodgates to corporations and even individuals acquiring hundreds of hectares of alienable lands of the public
domain under the guise that in the hands of PEA these lands are private lands. This will result in corporations amassing huge landholdings
never before seen in this country - creating the very evil that the constitutional ban was designed to prevent. This will completely reverse the
clear direction of constitutional development in this country. The 1935 Constitution allowed private corporations to acquire not more than
1,024 hectares of public lands.105 The 1973 Constitution prohibited private corporations from acquiring any kind of public land, and the 1987
Constitution has unequivocally reiterated this prohibition.

The contention of PEA and AMARI that public lands, once registered under Act No. 496 or PD No. 1529, automatically become private lands is
contrary to existing laws. Several laws authorize lands of the public domain to be registered under the Torrens System or Act No. 496, now
PD No. 1529, without losing their character as public lands. Section 122 of Act No. 496, and Section 103 of PD No. 1529, respectively, provide
as follows:

Act No. 496

"Sec. 122. Whenever public lands in the Philippine Islands belonging to the x x x Government of the Philippine Islands are alienated,
granted, or conveyed to persons or the public or private corporations, the same shall be brought forthwith under the operation
of this Act and shall become registered lands."

PD No. 1529

"Sec. 103. Certificate of Title to Patents. Whenever public land is by the Government alienated, granted or conveyed to any person,
the same shall be brought forthwith under the operation of this Decree." (Emphasis supplied)

Based on its legislative history, the phrase "conveyed to any person" in Section 103 of PD No. 1529 includes conveyances of public lands to
public corporations.

Alienable lands of the public domain "granted, donated, or transferred to a province, municipality, or branch or subdivision of the
Government," as provided in Section 60 of CA No. 141, may be registered under the Torrens System pursuant to Section 103 of PD No. 1529.
Such registration, however, is expressly subject to the condition in Section 60 of CA No. 141 that the land "shall not be alienated,
encumbered or otherwise disposed of in a manner affecting its title, except when authorized by Congress." This provision refers to
government reclaimed, foreshore and marshy lands of the public domain that have been titled but still cannot be alienated or encumbered
unless expressly authorized by Congress. The need for legislative authority prevents the registered land of the public domain from becoming
private land that can be disposed of to qualified private parties.

The Revised Administrative Code of 1987 also recognizes that lands of the public domain may be registered under the Torrens System.
Section 48, Chapter 12, Book I of the Code states –

"Sec. 48. Official Authorized to Convey Real Property. Whenever real property of the Government is authorized by law to be
conveyed, the deed of conveyance shall be executed in behalf of the government by the following:

(1) x x x

(2) For property belonging to the Republic of the Philippines, but titled in the name of any political subdivision or of
any corporate agency or instrumentality, by the executive head of the agency or instrumentality." (Emphasis supplied)
Thus, private property purchased by the National Government for expansion of a public wharf may be titled in the name of a government
corporation regulating port operations in the country. Private property purchased by the National Government for expansion of an airport may
also be titled in the name of the government agency tasked to administer the airport. Private property donated to a municipality for use as a
town plaza or public school site may likewise be titled in the name of the municipality. 106 All these properties become properties of the public
domain, and if already registered under Act No. 496 or PD No. 1529, remain registered land. There is no requirement or provision in any
existing law for the de-registration of land from the Torrens System.

Private lands taken by the Government for public use under its power of eminent domain become unquestionably part of the public domain.
Nevertheless, Section 85 of PD No. 1529 authorizes the Register of Deeds to issue in the name of the National Government new certificates of
title covering such expropriated lands. Section 85 of PD No. 1529 states –

"Sec. 85. Land taken by eminent domain. Whenever any registered land, or interest therein, is expropriated or taken by eminent
domain, the National Government, province, city or municipality, or any other agency or instrumentality exercising such right shall
file for registration in the proper Registry a certified copy of the judgment which shall state definitely by an adequate description,
the particular property or interest expropriated, the number of the certificate of title, and the nature of the public use. A
memorandum of the right or interest taken shall be made on each certificate of title by the Register of Deeds, and where the fee
simple is taken, a new certificate shall be issued in favor of the National Government, province, city, municipality, or any
other agency or instrumentality exercising such right for the land so taken. The legal expenses incident to the memorandum of
registration or issuance of a new certificate of title shall be for the account of the authority taking the land or interest therein."
(Emphasis supplied)

Consequently, lands registered under Act No. 496 or PD No. 1529 are not exclusively private or patrimonial lands. Lands of the public domain
may also be registered pursuant to existing laws.

AMARI makes a parting shot that the Amended JVA is not a sale to AMARI of the Freedom Islands or of the lands to be reclaimed from
submerged areas of Manila Bay. In the words of AMARI, the Amended JVA "is not a sale but a joint venture with a stipulation for
reimbursement of the original cost incurred by PEA for the earlier reclamation and construction works performed by the CDCP under its 1973
contract with the Republic." Whether the Amended JVA is a sale or a joint venture, the fact remains that the Amended JVA requires PEA to
"cause the issuance and delivery of the certificates of title conveying AMARI's Land Share in the name of AMARI."107

This stipulation still contravenes Section 3, Article XII of the 1987 Constitution which provides that private corporations "shall not hold such
alienable lands of the public domain except by lease." The transfer of title and ownership to AMARI clearly means that AMARI will "hold" the
reclaimed lands other than by lease. The transfer of title and ownership is a "disposition" of the reclaimed lands, a transaction considered a
sale or alienation under CA No. 141,108 the Government Auditing Code,109 and Section 3, Article XII of the 1987 Constitution.

The Regalian doctrine is deeply implanted in our legal system. Foreshore and submerged areas form part of the public domain and are
inalienable. Lands reclaimed from foreshore and submerged areas also form part of the public domain and are also inalienable, unless
converted pursuant to law into alienable or disposable lands of the public domain. Historically, lands reclaimed by the government are sui
generis, not available for sale to private parties unlike other alienable public lands. Reclaimed lands retain their inherent potential as areas
for public use or public service. Alienable lands of the public domain, increasingly becoming scarce natural resources, are to be distributed
equitably among our ever-growing population. To insure such equitable distribution, the 1973 and 1987 Constitutions have barred private
corporations from acquiring any kind of alienable land of the public domain. Those who attempt to dispose of inalienable natural resources of
the State, or seek to circumvent the constitutional ban on alienation of lands of the public domain to private corporations, do so at their own
risk.

We can now summarize our conclusions as follows:

1. The 157.84 hectares of reclaimed lands comprising the Freedom Islands, now covered by certificates of title in the name of PEA,
are alienable lands of the public domain. PEA may lease these lands to private corporations but may not sell or transfer
ownership of these lands to private corporations. PEA may only sell these lands to Philippine citizens, subject to the ownership
limitations in the 1987 Constitution and existing laws.

2. The 592.15 hectares of submerged areas of Manila Bay remain inalienable natural resources of the public domain until classified
as alienable or disposable lands open to disposition and declared no longer needed for public service. The government can make
such classification and declaration only after PEA has reclaimed these submerged areas. Only then can these lands qualify as
agricultural lands of the public domain, which are the only natural resources the government can alienate. In their present state, the
592.15 hectares of submerged areas are inalienable and outside the commerce of man.

3. Since the Amended JVA seeks to transfer to AMARI, a private corporation, ownership of 77.34 hectares110 of the Freedom Islands,
such transfer is void for being contrary to Section 3, Article XII of the 1987 Constitution which prohibits private corporations from
acquiring any kind of alienable land of the public domain.

4. Since the Amended JVA also seeks to transfer to AMARI ownership of 290.156 hectares 111 of still submerged areas of Manila Bay,
such transfer is void for being contrary to Section 2, Article XII of the 1987 Constitution which prohibits the alienation of natural
resources other than agricultural lands of the public domain. PEA may reclaim these submerged areas. Thereafter, the government
can classify the reclaimed lands as alienable or disposable, and further declare them no longer needed for public service. Still, the
transfer of such reclaimed alienable lands of the public domain to AMARI will be void in view of Section 3, Article XII of the 1987
Constitution which prohibits private corporations from acquiring any kind of alienable land of the public domain.

Clearly, the Amended JVA violates glaringly Sections 2 and 3, Article XII of the 1987 Constitution. Under Article 1409112 of the Civil Code,
contracts whose "object or purpose is contrary to law," or whose "object is outside the commerce of men," are "inexistent and void from the
beginning." The Court must perform its duty to defend and uphold the Constitution, and therefore declares the Amended JVA null and void
ab initio.

Seventh issue: whether the Court is the proper forum to raise the issue of whether the Amended JVA is grossly
disadvantageous to the government.

Considering that the Amended JVA is null and void ab initio, there is no necessity to rule on this last issue. Besides, the Court is not a trier of
facts, and this last issue involves a determination of factual matters.

WHEREFORE, the petition is GRANTED. The Public Estates Authority and Amari Coastal Bay Development Corporation are PERMANENTLY
ENJOINED from implementing the Amended Joint Venture Agreement which is hereby declared NULL and VOID ab initio. SO ORDERED.
THE SECRETARY OF THE G.R. No. 167707
DEPARTMENT OF ENVIRONMENT
AND NATURAL RESOURCES, THE
REGIONAL EXECUTIVE
DIRECTOR, DENR-REGION VI,
REGIONAL TECHNICAL
DIRECTOR FOR LANDS,
LANDS MANAGEMENT BUREAU,
REGION VI PROVINCIAL
ENVIRONMENT AND NATURAL
RESOURCES OFFICER OF KALIBO,
AKLAN, REGISTER OF DEEDS,
DIRECTOR OF LAND
REGISTRATION AUTHORITY,
DEPARTMENT OF TOURISM
SECRETARY, DIRECTOR OF
PHILIPPINE TOURISM
AUTHORITY,
Petitioners,

- versus -

MAYOR JOSE S. YAP, LIBERTAD

TALAPIAN, MILA Y. SUMNDAD, and
ANICETO YAP, in their behalf and Promulgated:
in behalf of all those similarly situated,
Respondents. October 8, 2008

x--------------------------------------------------x

DR. ORLANDO SACAY and G.R. No. 173775

WILFREDO GELITO, joined by
THE LANDOWNERS OF
BORACAY SIMILARLY
SITUATED NAMED IN A LIST,
ANNEX A OF THIS PETITION,
Petitioners,

- versus -

THE SECRETARY OF THE

DEPARTMENT OF ENVIRONMENT
AND NATURAL RESOURCES, THE
REGIONAL TECHNICAL
DIRECTOR FOR LANDS, LANDS
MANAGEMENT BUREAU,
REGION VI, PROVINCIAL
ENVIRONMENT AND NATURAL
RESOURCES OFFICER, KALIBO,
AKLAN,
Respondents.

x--------------------------------------------------x

DECISION

REYES, R.T., J.:

AT stake in these consolidated cases is the right of the present occupants of Boracay Island to secure titles over their occupied

lands.

There are two consolidated petitions. The first is G.R. No. 167707, a petition for review on certiorari of the Decision[1] of the Court of

Appeals (CA) affirming that[2] of the Regional Trial Court (RTC) in Kalibo, Aklan, which granted the petition for declaratory relief filed by

respondents-claimants Mayor Jose Yap, et al. and ordered the survey of Boracay for titling purposes. The second is G.R. No. 173775, a

petition for prohibition, mandamus, and nullification of Proclamation No. 1064[3] issued by President Gloria Macapagal-Arroyo classifying

Boracay into reserved forest and agricultural land.

The Antecedents

G.R. No. 167707

Boracay Island in the Municipality of Malay, Aklan, with its powdery white sand beaches and warm crystalline waters, is reputedly a

premier Philippine tourist destination. The island is also home to 12,003 inhabitants[4] who live in the bone-shaped islands three barangays.[5]

On April 14, 1976, the Department of Environment and Natural Resources (DENR) approved the National Reservation Survey of

Boracay Island,[6] which identified several lots as being occupied or claimed by named persons.[7]
 On November 10, 1978, then President Ferdinand Marcos issued Proclamation No. 1801[8] declaring Boracay Island, among other

islands, caves and peninsulas in the Philippines, as tourist zones and marine reserves under the administration of the Philippine Tourism

Authority (PTA). President Marcos later approved the issuance of PTA Circular 3-82[9] dated September 3, 1982, to implement Proclamation

No. 1801.

Claiming that Proclamation No. 1801 and PTA Circular No 3-82 precluded them from filing an application for judicial confirmation of

imperfect title or survey of land for titling purposes, respondents-claimants Mayor Jose S. Yap, Jr., Libertad Talapian, Mila Y. Sumndad, and

Aniceto Yap filed a petition for declaratory relief with the RTC in Kalibo, Aklan.

In their petition, respondents-claimants alleged that Proclamation No. 1801 and PTA Circular No. 3-82 raised doubts on their right to

secure titles over their occupied lands. They declared that they themselves, or through their predecessors-in-interest, had been in open,

continuous, exclusive, and notorious possession and occupation in Boracay since June 12, 1945, or earlier since time immemorial. They

declared their lands for tax purposes and paid realty taxes on them.[10]

Respondents-claimants posited that Proclamation No. 1801 and its implementing Circular did not place Boracay beyond the

commerce of man. Since the Island was classified as a tourist zone, it was susceptible of private ownership.Under Section 48(b) of

Commonwealth Act (CA) No. 141, otherwise known as the Public Land Act, they had the right to have the lots registered in their names

through judicial confirmation of imperfect titles.

The Republic, through the Office of the Solicitor General (OSG), opposed the petition for declaratory relief. The OSG countered

that Boracay Island was an unclassified land of the public domain. It formed part of the mass of lands classified as public forest, which was

not available for disposition pursuant to Section 3(a) of Presidential Decree (PD) No. 705 or the Revised Forestry Code, [11] as amended.

The OSG maintained that respondents-claimants reliance on PD No. 1801 and PTA Circular No. 3-82 was misplaced. Their right to

judicial confirmation of title was governed by CA No. 141 and PD No. 705. Since Boracay Island had not been classified as alienable and

disposable, whatever possession they had cannot ripen into ownership.

During pre-trial, respondents-claimants and the OSG stipulated on the following facts: (1) respondents-claimants were presently in

possession of parcels of land in Boracay Island; (2) these parcels of land were planted with coconut trees and other natural growing trees; (3)

the coconut trees had heights of more or less twenty (20) meters and were planted more or less fifty (50) years ago; and (4) respondents-

claimants declared the land they were occupying for tax purposes.[12]

The parties also agreed that the principal issue for resolution was purely legal: whether Proclamation No. 1801 posed any legal

hindrance or impediment to the titling of the lands in Boracay. They decided to forego with the trial and to submit the case for resolution upon

submission of their respective memoranda.[13]

The RTC took judicial notice[14] that certain parcels of land in Boracay Island, more particularly Lots 1 and 30, Plan PSU-5344, were

covered by Original Certificate of Title No. 19502 (RO 2222) in the name of the Heirs of Ciriaco S. Tirol. These lots were involved in Civil Case

Nos. 5222 and 5262 filed before the RTC of Kalibo, Aklan.[15] The titles were issued on

August 7, 1933.[16]

RTC and CA Dispositions

On July 14, 1999, the RTC rendered a decision in favor of respondents-claimants, with a fallo reading:

WHEREFORE, in view of the foregoing, the Court declares that Proclamation No. 1801 and PTA Circular No. 3-82
pose no legal obstacle to the petitioners and those similarly situated to acquire title to their lands in Boracay, in accordance
with the applicable laws and in the manner prescribed therein; and to have their lands surveyed and approved by
respondent Regional Technical Director of Lands as the approved survey does not in itself constitute a title to the land.

SO ORDERED.[17]
 The RTC upheld respondents-claimants right to have their occupied lands titled in their name. It ruled that neither Proclamation No.

1801 nor PTA Circular No. 3-82 mentioned that lands in Boracay were inalienable or could not be the subject of disposition.[18] The Circular

itself recognized private ownership of lands.[19] The trial court cited Sections 87[20] and 53[21] of the Public Land Act as basis for acknowledging

private ownership of lands in Boracay and that only those forested areas in public lands were declared as part of the forest reserve.[22]

The OSG moved for reconsideration but its motion was denied.[23] The Republic then appealed to the CA.

On December 9, 2004, the appellate court affirmed in toto the RTC decision, disposing as follows:

WHEREFORE, in view of the foregoing premises, judgment is hereby rendered by us DENYING the appeal filed in
this case and AFFIRMING the decision of the lower court.[24]

The CA held that respondents-claimants could not be prejudiced by a declaration that the lands they occupied since time

immemorial were part of a forest reserve.

Again, the OSG sought reconsideration but it was similarly denied.[25] Hence, the present petition under Rule 45.

G.R. No. 173775

On May 22, 2006, during the pendency of G.R. No. 167707, President Gloria Macapagal-Arroyo issued Proclamation No. 1064[26] classifying

Boracay Island into four hundred (400) hectares of reserved forest land (protection purposes) and six hundred twenty-eight and 96/100

(628.96) hectares of agricultural land (alienable and disposable). The Proclamation likewise provided for a fifteen-meter buffer zone on each

side of the centerline of roads and trails, reserved for right-of-way and which shall form part of the area reserved for forest land protection

purposes.

On August 10, 2006, petitioners-claimants Dr. Orlando Sacay,[27] Wilfredo Gelito,[28] and other landowners[29] in Boracay filed with

this Court an original petition for prohibition, mandamus, and nullification of Proclamation No. 1064. [30] They allege that the Proclamation

infringed on their prior vested rights over portions of Boracay. They have been in continued possession of their respective lots in Boracay

since time immemorial. They have also invested billions of pesos in developing their lands and building internationally renowned first class

resorts on their lots.[31]

Petitioners-claimants contended that there is no need for a proclamation reclassifying Boracay into agricultural land. Being classified

as neither mineral nor timber land, the island is deemed agricultural pursuant to the Philippine Bill of 1902 and Act No. 926, known as the

first Public Land Act.[32] Thus, their possession in the concept of owner for the required period entitled them to judicial confirmation of

imperfect title.

Opposing the petition, the OSG argued that petitioners-claimants do not have a vested right over their occupied portions in the

island. Boracay is an unclassified public forest land pursuant to Section 3(a) of PD No. 705. Being public forest, the claimed portions of the

island are inalienable and cannot be the subject of judicial confirmation of imperfect title. It is only the executive department, not the courts,

which has authority to reclassify lands of the public domain into alienable and disposable lands. There is a need for a positive government act

in order to release the lots for disposition.

On November 21, 2006, this Court ordered the consolidation of the two petitions as they principally involve the same issues on

the land classification of Boracay Island.[33]

 Issues

G.R. No. 167707

The OSG raises the lone issue of whether Proclamation No. 1801 and PTA Circular No. 3-82 pose any legal obstacle for respondents,

and all those similarly situated, to acquire title to their occupied lands in Boracay Island.[34]

G.R. No. 173775

Petitioners-claimants hoist five (5) issues, namely:

I.
AT THE TIME OF THE ESTABLISHED POSSESSION OF PETITIONERS IN CONCEPT OF OWNER OVER THEIR RESPECTIVE
AREAS IN BORACAY, SINCE TIME IMMEMORIAL OR AT THE LATEST SINCE 30 YRS. PRIOR TO THE FILING OF THE
PETITION FOR DECLARATORY RELIEF ON NOV. 19, 1997, WERE THE AREAS OCCUPIED BY THEM PUBLIC AGRICULTURAL
LANDS AS DEFINED BY LAWS THEN ON JUDICIAL CONFIRMATION OF IMPERFECT TITLES OR PUBLIC FOREST AS DEFINED
BY SEC. 3a, PD 705?

II.
HAVE PETITIONERS OCCUPANTS ACQUIRED PRIOR VESTED RIGHT OF PRIVATE OWNERSHIP OVER THEIR OCCUPIED
PORTIONS OF BORACAY LAND, DESPITE THE FACT THAT THEY HAVE NOT APPLIED YET FOR JUDICIAL CONFIRMATION OF
IMPERFECT TITLE?

III.
IS THE EXECUTIVE DECLARATION OF THEIR AREAS AS ALIENABLE AND DISPOSABLE UNDER SEC 6, CA 141 [AN]
INDISPENSABLE PRE-REQUISITE FOR PETITIONERS TO OBTAIN TITLE UNDER THE TORRENS SYSTEM?

IV.
IS THE ISSUANCE OF PROCLAMATION 1064 ON MAY 22, 2006, VIOLATIVE OF THE PRIOR VESTED RIGHTS TO PRIVATE
OWNERSHIP OF PETITIONERS OVER THEIR LANDS IN BORACAY, PROTECTED BY THE DUE PROCESS CLAUSE OF THE
CONSTITUTION OR IS PROCLAMATION 1064 CONTRARY TO SEC. 8, CA 141, OR SEC. 4(a) OF RA 6657.

V.
CAN RESPONDENTS BE COMPELLED BY MANDAMUS TO ALLOW THE SURVEY AND TO APPROVE THE SURVEY PLANS FOR
PURPOSES OF THE APPLICATION FOR TITLING OF THE LANDS OF PETITIONERS IN BORACAY?[35](Underscoring supplied)

In capsule, the main issue is whether private claimants (respondents-claimants in G.R. No. 167707 and petitioners-claimants in G.R.

No. 173775) have a right to secure titles over their occupied portions in Boracay. The twin petitions pertain to their right, if any, to judicial

confirmation of imperfect title under CA No. 141, as amended. They do not involve their right to secure title under other pertinent laws.

Our Ruling

Regalian Doctrine and power of the executive to reclassify lands of the public domain

Private claimants rely on three (3) laws and executive acts in their bid for judicial confirmation of imperfect title, namely: (a)

Philippine Bill of 1902[36] in relation to Act No. 926, later amended and/or superseded by Act No. 2874 and CA No. 141; [37] (b) Proclamation

No. 1801[38] issued by then President Marcos; and (c) Proclamation No. 1064[39] issued by President Gloria Macapagal-Arroyo. We shall

proceed to determine their rights to apply for judicial confirmation of imperfect title under these laws and executive acts.

But first, a peek at the Regalian principle and the power of the executive to reclassify lands of the public domain.

The 1935 Constitution classified lands of the public domain into agricultural, forest or timber. [40] Meanwhile, the 1973 Constitution

provided the following divisions: agricultural, industrial or commercial, residential, resettlement, mineral, timber or forest and grazing lands,

and such other classes as may be provided by law,[41] giving the government great leeway for classification.[42] Then the 1987 Constitution

reverted to the 1935 Constitution classification with one addition: national parks.[43] Of these, only agricultural lands may be

alienated.[44] Prior to Proclamation No. 1064 of May 22, 2006, Boracay Island had never been expressly and administratively classified under

any of these grand divisions. Boracay was an unclassified land of the public domain.

The Regalian Doctrine dictates that all lands of the public domain belong to the State, that the State is the source of any asserted

right to ownership of land and charged with the conservation of such patrimony. [45] The doctrine has been consistently adopted under the

1935, 1973, and 1987 Constitutions.[46]

 All lands not otherwise appearing to be clearly within private ownership are presumed to belong to the State. [47] Thus, all lands that

have not been acquired from the government, either by purchase or by grant, belong to the State as part of the inalienable public

domain.[48] Necessarily, it is up to the State to determine if lands of the public domain will be disposed of for private ownership. The

government, as the agent of the state, is possessed of the plenary power as the persona in law to determine who shall be the favored

recipients of public lands, as well as under what terms they may be granted such privilege, not excluding the placing of obstacles in the way

of their exercise of what otherwise would be ordinary acts of ownership.[49]

Our present land law traces its roots to the Regalian Doctrine. Upon the Spanish conquest of the Philippines, ownership of all lands,

territories and possessions in the Philippines passed to the Spanish Crown.[50] The Regalian doctrine was first introduced in

the Philippines through the Laws of the Indies and the Royal Cedulas, which laid the foundation that all lands that were not acquired from the

Government, either by purchase or by grant, belong to the public domain.[51]

The Laws of the Indies was followed by the Ley Hipotecaria or the Mortgage Law of 1893. The Spanish Mortgage Law provided for

the systematic registration of titles and deeds as well as possessory claims.[52]

The Royal Decree of 1894 or the Maura Law[53] partly amended the Spanish Mortgage Law and the Laws of the Indies. It established

possessory information as the method of legalizing possession of vacant Crown land, under certain conditions which were set forth in said

decree.[54] Under Section 393 of the Maura Law, an informacion posesoria or possessory information title,[55] when duly inscribed in the

Registry of Property, is converted into a title of ownership only after the lapse of twenty (20) years of uninterrupted possession which must

be actual, public, and adverse,[56] from the date of its inscription.[57] However, possessory information title had to be perfected one year after

the promulgation of the Maura Law, or until April 17, 1895. Otherwise, the lands would revert to the State.[58]

In sum, private ownership of land under the Spanish regime could only be founded on royal concessions which took various forms,

namely: (1) titulo real or royal grant; (2) concesion especial or special grant; (3) composicion con el estado or adjustment title; (4) titulo de

compra or title by purchase; and (5) informacion posesoria or possessory information title.[59]

The first law governing the disposition of public lands in the Philippines under American rule was embodied in the Philippine Bill

of 1902.[60] By this law, lands of the public domain in the Philippine Islands were classified into three (3) grand divisions, to wit: agricultural,

mineral, and timber or forest lands.[61] The act provided for, among others, the disposal of mineral lands by means of absolute grant (freehold

system) and by lease (leasehold system).[62] It also provided the definition by exclusion of agricultural public lands. [63] Interpreting the

meaning of agricultural lands under the Philippine Bill of 1902, the Court declared in Mapa v. Insular Government:[64]

x x x In other words, that the phrase agricultural land as used in Act No. 926 means those public lands
acquired from Spain which are not timber or mineral lands. x x x[65] (Emphasis Ours)

On February 1, 1903, the Philippine Legislature passed Act No. 496, otherwise known as the Land Registration Act. The act

established a system of registration by which recorded title becomes absolute, indefeasible, and imprescriptible. This is known as

the Torrens system.[66]

Concurrently, on October 7, 1903, the Philippine Commission passed Act No. 926, which was the first Public Land Act. The Act

introduced the homestead system and made provisions for judicial and administrative confirmation of imperfect titles and for the sale or lease

of public lands. It permitted corporations regardless of the nationality of persons owning the controlling stock to lease or purchase lands of

the public domain.[67] Under the Act, open, continuous, exclusive, and notorious possession and occupation of agricultural lands for the next

ten (10) years preceding July 26, 1904 was sufficient for judicial confirmation of imperfect title.[68]

On November 29, 1919, Act No. 926 was superseded by Act No. 2874, otherwise known as the second Public Land Act. This new,

more comprehensive law limited the exploitation of agricultural lands to Filipinos and Americans and citizens of other countries which gave
Filipinos the same privileges. For judicial confirmation of title, possession and occupation en concepto dueo since time immemorial, or

since July 26, 1894, was required.[69]

After the passage of the 1935 Constitution, CA No. 141 amended Act No. 2874 on December 1, 1936. To this day, CA No. 141, as

amended, remains as the existing general law governing the classification and disposition of lands of the public domain other than timber

and mineral lands,[70] and privately owned lands which reverted to the State.[71]

Section 48(b) of CA No. 141 retained the requirement under Act No. 2874 of possession and occupation of lands of the public

domain since time immemorial or since July 26, 1894. However, this provision was superseded by Republic Act (RA) No. 1942,[72] which

provided for a simple thirty-year prescriptive period for judicial confirmation of imperfect title. The provision was last amended by PD No.

1073,[73] which now provides for possession and occupation of the land applied for since June 12, 1945, or earlier.[74]

The issuance of PD No. 892[75] on February 16, 1976 discontinued the use of Spanish titles as evidence in land registration

proceedings.[76] Under the decree, all holders of Spanish titles or grants should apply for registration of their lands under Act No. 496 within

six (6) months from the effectivity of the decree on February 16, 1976. Thereafter, the recording of all unregistered lands[77] shall be

governed by Section 194 of the Revised Administrative Code, as amended by Act No. 3344.

On June 11, 1978, Act No. 496 was amended and updated by PD No. 1529, known as the Property Registration Decree. It was

enacted to codify the various laws relative to registration of property.[78] It governs registration of lands under the Torrens system as well as

unregistered lands, including chattel mortgages.[79]

A positive act declaring land as alienable and disposable is required. In keeping with the presumption of State ownership,

the Court has time and again emphasized that there must be a positive act of the government, such as an official

proclamation,[80] declassifying inalienable public land into disposable land for agricultural or other purposes.[81] In fact, Section 8 of CA No.

141 limits alienable or disposable lands only to those lands which have been officially delimited and classified.[82]

The burden of proof in overcoming the presumption of State ownership of the lands of the public domain is on the person applying

for registration (or claiming ownership), who must prove that the land subject of the application is alienable or disposable. [83] To overcome

this presumption, incontrovertible evidence must be established that the land subject of the application (or claim) is alienable or

disposable.[84] There must still be a positive act declaring land of the public domain as alienable and disposable. To prove that the land

subject of an application for registration is alienable, the 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.[85] The applicant may also secure a certification from the government that the land claimed to have been

possessed for the required number of years is alienable and disposable.[86]

In the case at bar, no such proclamation, executive order, administrative action, report, statute, or certification was presented to

the Court. The records are bereft of evidence showing that, prior to 2006, the portions of Boracay occupied by private claimants were subject

of a government proclamation that the land is alienable and disposable. Absent such well-nigh incontrovertible evidence, the Court cannot

accept the submission that lands occupied by private claimants were already open to disposition before 2006. Matters of land classification or

reclassification cannot be assumed. They call for proof.[87]

Ankron and De Aldecoa did not make the whole of Boracay Island, or portions of it, agricultural lands. Private claimants

posit that Boracay was already an agricultural land pursuant to the old cases Ankron v. Government of the

Philippine Islands (1919)[88] and De Aldecoa v. The Insular Government (1909).[89] These cases were decided under the provisions of the

Philippine Bill of 1902 and Act No. 926. There is a statement in these old cases that in the absence of evidence to the contrary, that in each

case the lands are agricultural lands until the contrary is shown.[90]

Private claimants reliance on Ankron and De Aldecoa is misplaced. These cases did not have the effect of converting the whole

of Boracay Island or portions of it into agricultural lands. It should be stressed that the Philippine Bill of 1902 and Act No. 926 merely
provided the manner through which land registration courts would classify lands of the public domain. Whether the land would be classified as

timber, mineral, or agricultural depended on proof presented in each case.

Ankron and De Aldecoa were decided at a time when the President of the Philippines had no power to classify lands of the public

domain into mineral, timber, and agricultural. At that time, the courts were free to make corresponding classifications in justiciable cases, or

were vested with implicit power to do so, depending upon the preponderance of the evidence.[91] This was the Courts ruling in Heirs of the

Late Spouses Pedro S. Palanca and Soterranea Rafols Vda. De Palanca v. Republic,[92] in which it stated, through Justice Adolfo Azcuna, viz.:

x x x Petitioners furthermore insist that a particular land need not be formally released by an act of the Executive
before it can be deemed open to private ownership, citing the cases of Ramos v. Director of Lands and Ankron v.
Government of the PhilippineIslands.

xxxx

Petitioners reliance upon Ramos v. Director of Lands and Ankron v. Government is misplaced. These cases were
decided under the Philippine Bill of 1902 and the first Public Land Act No. 926 enacted by the Philippine Commission
on October 7, 1926, under which there was no legal provision vesting in the Chief Executive or President of the Philippines
the power to classify lands of the public domain into mineral, timber and agricultural so that the courts then were free to
make corresponding classifications in justiciable cases, or were vested with implicit power to do so, depending upon the
preponderance of the evidence.[93]

To aid the courts in resolving land registration cases under Act No. 926, it was then necessary to devise a presumption on land

classification. Thus evolved the dictum in Ankron that the courts have a right to presume, in the absence of evidence to the contrary, that in

each case the lands are agricultural lands until the contrary is shown.[94]

But We cannot unduly expand the presumption in Ankron and De Aldecoa to an argument that all lands of the public domain had

been automatically reclassified as disposable and alienable agricultural lands. By no stretch of imagination did the presumption convert all

lands of the public domain into agricultural lands.

If We accept the position of private claimants, the Philippine Bill of 1902 and Act No. 926 would have automatically made all lands in

the Philippines, except those already classified as timber or mineral land, alienable and disposable lands. That would take these lands out of

State ownership and worse, would be utterly inconsistent with and totally repugnant to the long-entrenched Regalian doctrine.

The presumption in Ankron and De Aldecoa attaches only to land registration cases brought under the provisions of Act No. 926, or

more specifically those cases dealing with judicial and administrative confirmation of imperfect titles.The presumption applies to an applicant

for judicial or administrative conformation of imperfect title under Act No. 926. It certainly cannot apply to landowners, such as private

claimants or their predecessors-in-interest, who failed to avail themselves of the benefits of Act No. 926. As to them, their land remained

unclassified and, by virtue of the Regalian doctrine, continued to be owned by the State.

In any case, the assumption in Ankron and De Aldecoa was not absolute. Land classification was, in the end, dependent on proof. If

there was proof that the land was better suited for non-agricultural uses, the courts could adjudge it as a mineral or timber land despite the

presumption. In Ankron, this Court stated:

In the case of Jocson vs. Director of Forestry (supra), the Attorney-General admitted in effect that whether the
particular land in question belongs to one class or another is a question of fact. The mere fact that a tract of land has trees
upon it or has mineral within it is not of itself sufficient to declare that one is forestry land and the other, mineral
land. There must be some proof of the extent and present or future value of the forestry and of the minerals. While, as we
have just said, many definitions have been given for agriculture, forestry, and mineral lands, and that in each case it is a
question of fact, we think it is safe to say that in order to be forestry or mineral land the proof must show that it is more
valuable for the forestry or the mineral which it contains than it is for agricultural purposes. (Sec. 7, Act No. 1148.) It is
not sufficient to show that there exists some trees upon the land or that it bears some mineral. Land may be classified as
forestry or mineral today, and, by reason of the exhaustion of the timber or mineral, be classified as agricultural land
tomorrow. And vice-versa, by reason of the rapid growth of timber or the discovery of valuable minerals, lands classified
as agricultural today may be differently classified tomorrow. Each case must be decided upon the proof in that
particular case, having regard for its present or future value for one or the other purposes. We believe, however,
considering the fact that it is a matter of public knowledge that a majority of the lands in the Philippine Islands are
agricultural lands that the courts have a right to presume, in the absence of evidence to the contrary, that in each case the
lands are agricultural lands until the contrary is shown. Whatever the land involved in a particular land registration
case is forestry or mineral land must, therefore, be a matter of proof. Its superior value for one purpose or the
other is a question of fact to be settled by the proof in each particular case. The fact that the land is a manglar
[mangrove swamp] is not sufficient for the courts to decide whether it is agricultural, forestry, or mineral land. It may
perchance belong to one or the other of said classes of land. The Government, in the first instance, under the provisions of
Act No. 1148, may, by reservation, decide for itself what portions of public land shall be considered forestry land, unless
private interests have intervened before such reservation is made. In the latter case, whether the land is agricultural,
forestry, or mineral, is a question of proof. Until private interests have intervened, the Government, by virtue of the terms
 of said Act (No. 1148), may decide for itself what portions of the public domain shall be set aside and reserved as forestry
or mineral land. (Ramos vs. Director of Lands, 39 Phil. 175; Jocson vs. Director of Forestry, supra)[95] (Emphasis ours)

Since 1919, courts were no longer free to determine the classification of lands from the facts of each case, except those that have

already became private lands.[96] Act No. 2874, promulgated in 1919 and reproduced in Section 6 of CA No. 141, gave the Executive

Department, through the President, the exclusive prerogative to classify or reclassify public lands into alienable or disposable, mineral or

forest.96-a Since then, courts no longer had the authority, whether express or implied, to determine the classification of lands of the public

domain.[97]

Here, private claimants, unlike the Heirs of Ciriaco Tirol who were issued their title in 1933, [98] did not present a justiciable case for

determination by the land registration court of the propertys land classification. Simply put, there was no opportunity for the courts then to

resolve if the land the Boracay occupants are now claiming were agricultural lands. When Act No. 926 was supplanted by Act No. 2874 in

1919, without an application for judicial confirmation having been filed by private claimants or their predecessors-in-interest, the courts were

no longer authorized to determine the propertys land classification. Hence, private claimants cannot bank on Act No. 926.

We note that the RTC decision[99] in G.R. No. 167707 mentioned Krivenko v. Register of Deeds of Manila,[100] which was decided in

1947 when CA No. 141, vesting the Executive with the sole power to classify lands of the public domain was already in effect. Krivenko cited

the old cases Mapa v. Insular Government,[101] De Aldecoa v. The Insular Government,[102] and Ankron v. Government of the

Philippine Islands.[103]

Krivenko, however, is not controlling here because it involved a totally different issue. The pertinent issue in Krivenko was whether

residential lots were included in the general classification of agricultural lands; and if so, whether an alien could acquire a residential lot. This

Court ruled that as an alien, Krivenko was prohibited by the 1935 Constitution [104] from acquiring agricultural land, which included residential

lots. Here, the issue is whether unclassified lands of the public domain are automatically deemed agricultural.

Notably, the definition of agricultural public lands mentioned in Krivenko relied on the old cases decided prior to the enactment of

Act No. 2874, including Ankron and De Aldecoa.[105] As We have already stated, those cases cannot apply here, since they were decided when

the Executive did not have the authority to classify lands as agricultural, timber, or mineral.

Private claimants continued possession under Act No. 926 does not create a presumption that the land is

alienable. Private claimants also contend that their continued possession of portions of Boracay Island for the requisite period of ten (10)

years under Act No. 926[106] ipso facto converted the island into private ownership. Hence, they may apply for a title in their name.

A similar argument was squarely rejected by the Court in Collado v. Court of Appeals.[107] Collado, citing the separate opinion of now

Chief Justice Reynato S. Puno in Cruz v. Secretary of Environment and Natural Resources,107-aruled:

Act No. 926, the first Public Land Act, was passed in pursuance of the provisions of the
Philippine Bill of 1902. The law governed the disposition of lands of the public domain. It prescribed
rules and regulations for the homesteading, selling and leasing of portions of the public domain of the
Philippine Islands, and prescribed the terms and conditions to enable persons to perfect their titles to
public lands in the Islands. It also provided for the issuance of patents to certain native settlers upon
public lands, for the establishment of town sites and sale of lots therein, for the completion of imperfect
titles, and for the cancellation or confirmation of Spanish concessions and grants in the Islands. In
short, the Public Land Act operated on the assumption that title to public lands in the Philippine Islands
remained in the government; and that the governments title to public land sprung from the Treaty of
Paris and other subsequent treaties between Spain and the United States. The term public land referred
to all lands of the public domain whose title still remained in the government and are thrown open to
private appropriation and settlement, and excluded the patrimonial property of the government and the
friar lands.

Thus, it is plain error for petitioners to argue that under the Philippine Bill of 1902 and Public Land Act No.
926, mere possession by private individuals of lands creates the legal presumption that the lands are
alienable and disposable.[108] (Emphasis Ours)

Except for lands already covered by existing titles, Boracay was an unclassified land of the public domain prior to

Proclamation No. 1064. Such unclassified lands are considered public forest under PD No. 705. The DENR[109]and the National

Mapping and Resource Information Authority[110] certify that Boracay Island is an unclassified land of the public domain.
 PD No. 705 issued by President Marcos categorized all unclassified lands of the public domain as public forest. Section 3(a) of PD No.

705 defines a public forest as a mass of lands of the public domain which has not been the subject of the present system of classification for

the determination of which lands are needed for forest purpose and which are not. Applying PD No. 705, all unclassified lands, including those

in Boracay Island, are ipso facto considered public forests. PD No. 705, however, respects titles already existing prior to its effectivity.

The Court notes that the classification of Boracay as a forest land under PD No. 705 may seem to be out of touch with the present

realities in the island. Boracay, no doubt, has been partly stripped of its forest cover to pave the way for commercial developments. As a

premier tourist destination for local and foreign tourists, Boracay appears more of a commercial island resort, rather than a forest land.

Nevertheless, that the occupants of Boracay have built multi-million peso beach resorts on the island;[111] that the island has already

been stripped of its forest cover; or that the implementation of Proclamation No. 1064 will destroy the islands tourism industry,

do not negate its character as public forest.

Forests, in the context of both the Public Land Act and the Constitution [112] classifying lands of the public domain into agricultural,

forest or timber, mineral lands, and national parks, do not necessarily refer to large tracts of wooded land or expanses covered by dense

growths of trees and underbrushes.[113] The discussion in Heirs of Amunategui v. Director of Forestry[114] is particularly instructive:

A forested area classified as forest land of the public domain does not lose such classification simply because
loggers or settlers may have stripped it of its forest cover. Parcels of land classified as forest land may actually be covered
with grass or planted to crops by kaingin cultivators or other farmers. Forest lands do not have to be on mountains or in
out of the way places. Swampy areas covered by mangrove trees, nipa palms, and other trees growing in brackish or sea
water may also be classified as forest land. The classification is descriptive of its legal nature or status and does
not have to be descriptive of what the land actually looks like. Unless and until the land classified as forest is
released in an official proclamation to that effect so that it may form part of the disposable agricultural lands of the public
domain, the rules on confirmation of imperfect title do not apply.[115] (Emphasis supplied)

There is a big difference between forest as defined in a dictionary and forest or timber land as a classification of lands of the public domain as

appearing in our statutes. One is descriptive of what appears on the land while the other is a legal status, a classification for legal

purposes.[116] At any rate, the Court is tasked to determine the legal status of Boracay Island, and not look into its physical layout. Hence,

even if its forest cover has been replaced by beach resorts, restaurants and other commercial establishments, it has not been automatically

converted from public forest to alienable agricultural land.

Private claimants cannot rely on Proclamation No. 1801 as basis for judicial confirmation of imperfect title. The

proclamation did not convert Boracay into an agricultural land. However, private claimants argue that Proclamation No. 1801 issued

by then President Marcos in 1978 entitles them to judicial confirmation of imperfect title. The Proclamation classified Boracay, among other

islands, as a tourist zone. Private claimants assert that, as a tourist spot, the island is susceptible of private ownership.

Proclamation No. 1801 or PTA Circular No. 3-82 did not convert the whole of Boracay into an agricultural land. There is nothing in

the law or the Circular which made Boracay Island an agricultural land. The reference in Circular No. 3-82 to private lands[117] and areas

declared as alienable and disposable[118] does not by itself classify the entire island as agricultural. Notably, Circular No. 3-82 makes reference

not only to private lands and areas but also to public forested lands. Rule VIII, Section 3 provides:

No trees in forested private lands may be cut without prior authority from the PTA. All forested areas in public
lands are declared forest reserves. (Emphasis supplied)

Clearly, the reference in the Circular to both private and public lands merely recognizes that the island can be classified by the

Executive department pursuant to its powers under CA No. 141. In fact, Section 5 of the Circular recognizes the then Bureau of Forest

Developments authority to declare areas in the island as alienable and disposable when it provides:

Subsistence farming, in areas declared as alienable and disposable by the Bureau of Forest Development.

Therefore, Proclamation No. 1801 cannot be deemed the positive act needed to classify Boracay Island as alienable and disposable

land. If President Marcos intended to classify the island as alienable and disposable or forest, or both, he would have identified the specific

limits of each, as President Arroyo did in Proclamation No. 1064. This was not done in Proclamation No. 1801.
 The Whereas clauses of Proclamation No. 1801 also explain the rationale behind the declaration of Boracay Island, together with

other islands, caves and peninsulas in the Philippines, as a tourist zone and marine reserve to be administered by the PTA to ensure the

concentrated efforts of the public and private sectors in the development of the areas tourism potential with due regard for ecological balance

in the marine environment. Simply put, the proclamation is aimed at administering the islands for tourism and ecological purposes. It

does not address the areas alienability.[119]

More importantly, Proclamation No. 1801 covers not only Boracay Island, but sixty-four (64) other islands, coves, and peninsulas in

the Philippines, such as Fortune and Verde Islands in Batangas, Port Galera in Oriental Mindoro, Panglao and Balicasag Islands in Bohol,

Coron Island, Puerto Princesa and surrounding areas in Palawan, Camiguin Island in Cagayan de Oro, and Misamis Oriental, to name a few. If

the designation of Boracay Island as tourist zone makes it alienable and disposable by virtue of Proclamation No. 1801, all the other areas

mentioned would likewise be declared wide open for private disposition. That could not have been, and is clearly beyond, the intent of the

proclamation.

It was Proclamation No. 1064 of 2006 which positively declared part of Boracay as alienable and opened the same to

private ownership. Sections 6 and 7 of CA No. 141[120] provide that it is only the President, upon the recommendation of the proper

department head, who has the authority to classify the lands of the public domain into alienable or disposable, timber and mineral lands.[121]

In issuing Proclamation No. 1064, President Gloria Macapagal-Arroyo merely exercised the authority granted to her to classify lands

of the public domain, presumably subject to existing vested rights. Classification of public lands is the exclusive prerogative of the Executive

Department, through the Office of the President. Courts have no authority to do so.[122] Absent such classification, the land remains

unclassified until released and rendered open to disposition.[123]

Proclamation No. 1064 classifies Boracay into 400 hectares of reserved forest land and 628.96 hectares of agricultural land. The

Proclamation likewise provides for a 15-meter buffer zone on each side of the center line of roads and trails, which are reserved for right of

way and which shall form part of the area reserved for forest land protection purposes.

Contrary to private claimants argument, there was nothing invalid or irregular, much less unconstitutional, about the classification

of Boracay Island made by the President through Proclamation No. 1064. It was within her authority to make such classification, subject to

existing vested rights.

Proclamation No. 1064 does not violate the Comprehensive Agrarian Reform Law. Private claimants further assert that

Proclamation No. 1064 violates the provision of the Comprehensive Agrarian Reform Law (CARL) or RA No. 6657 barring conversion of public

forests into agricultural lands. They claim that since Boracay is a public forest under PD No. 705, President Arroyo can no longer convert it

into an agricultural land without running afoul of Section 4(a) of RA No. 6657, thus:

SEC. 4. Scope. The Comprehensive Agrarian Reform Law of 1988 shall cover, regardless of tenurial arrangement
and commodity produced, all public and private agricultural lands as provided in Proclamation No. 131 and Executive Order
No. 229, including other lands of the public domain suitable for agriculture.

More specifically, the following lands are covered by the Comprehensive Agrarian Reform Program:

(a) All alienable and disposable lands of the public domain devoted to or suitable for
agriculture. No reclassification of forest or mineral lands to agricultural lands shall be
undertaken after the approval of this Act until Congress, taking into account ecological,
developmental and equity considerations, shall have determined by law, the specific limits of the
public domain.

That Boracay Island was classified as a public forest under PD No. 705 did not bar the Executive from later converting it into

agricultural land. Boracay Island still remained an unclassified land of the public domain despite PD No. 705.

In Heirs of the Late Spouses Pedro S. Palanca and Soterranea Rafols v. Republic,[124] the Court stated that unclassified lands are

public forests:
While it is true that the land classification map does not categorically state that the islands are public
forests, the fact that they were unclassified lands leads to the same result. In the absence of the classification as
mineral or timber land, the land remains unclassified land until released and rendered open to disposition. [125] (Emphasis
supplied)
 Moreover, the prohibition under the CARL applies only to a reclassification of land. If the land had never been previously classified,

as in the case of Boracay, there can be no prohibited reclassification under the agrarian law. We agree with the opinion of the Department of

Justice[126] on this point:

Indeed, the key word to the correct application of the prohibition in Section 4(a) is the word
reclassification. Where there has been no previous classification of public forest [referring, we repeat, to the mass of the
public domain which has not been the subject of the present system of classification for purposes of determining which are
needed for forest purposes and which are not] into permanent forest or forest reserves or some other forest uses under
the Revised Forestry Code, there can be no reclassification of forest lands to speak of within the meaning of Section 4(a).

Thus, obviously, the prohibition in Section 4(a)
agricultural lands without a prior law delimiting the limits of
of the public domain, denominated as public forest under
determined, or classified, as needed for forest purposes
Code.[127]
of the CARL against the reclassification of forest lands to
the public domain, does not, and cannot, apply to those lands
the Revised Forestry Code, which have not been previously
in accordance with the provisions of the Revised Forestry

Private claimants are not entitled to apply for judicial confirmation of imperfect title under CA No. 141. Neither do they

have vested rights over the occupied lands under the said law. There are two requisites for judicial confirmation of imperfect or

incomplete title under CA No. 141, namely: (1) open, continuous, exclusive, and notorious possession and occupation of the subject land by

himself or through his predecessors-in-interest under a bona fide claim of ownership since time immemorial or from June 12, 1945; and (2)

the classification of the land as alienable and disposable land of the public domain.[128]

As discussed, the Philippine Bill of 1902, Act No. 926, and Proclamation No. 1801 did not convert portions of Boracay Island into an

agricultural land. The island remained an unclassified land of the public domain and, applying the Regalian doctrine, is considered State

property.

Private claimants bid for judicial confirmation of imperfect title, relying on the Philippine Bill of 1902, Act No. 926, and Proclamation

No. 1801, must fail because of the absence of the second element of alienable and disposable land.Their entitlement to a government grant

under our present Public Land Act presupposes that the land possessed and applied for is already alienable and disposable. This is clear from

the wording of the law itself.[129] Where the land is not alienable and disposable, possession of the land, no matter how long, cannot confer

ownership or possessory rights.[130]

Neither may private claimants apply for judicial confirmation of imperfect title under Proclamation No. 1064, with respect to those

lands which were classified as agricultural lands. Private claimants failed to prove the first element of open, continuous, exclusive, and

notorious possession of their lands in Boracay since June 12, 1945.

We cannot sustain the CA and RTC conclusion in the petition for declaratory relief that private claimants complied with the requisite

period of possession.

The tax declarations in the name of private claimants are insufficient to prove the first element of possession. We note that the

earliest of the tax declarations in the name of private claimants were issued in 1993. Being of recent dates,the tax declarations are not

sufficient to convince this Court that the period of possession and occupation commenced on June 12, 1945.

Private claimants insist that they have a vested right in Boracay, having been in possession of the island for a long time. They have

invested millions of pesos in developing the island into a tourist spot. They say their continued possession and investments give them a

vested right which cannot be unilaterally rescinded by Proclamation No. 1064.

The continued possession and considerable investment of private claimants do not automatically give them a vested right in

Boracay. Nor do these give them a right to apply for a title to the land they are presently occupying. This Court is constitutionally bound to

decide cases based on the evidence presented and the laws applicable. As the law and jurisprudence stand, private claimants are ineligible to

apply for a judicial confirmation of title over their occupied portions in Boracay even with their continued possession and considerable

investment in the island.

 One Last Note

The Court is aware that millions of pesos have been invested for the development of Boracay Island, making it a by-word in the local

and international tourism industry. The Court also notes that for a number of years, thousands of people have called the island their

home. While the Court commiserates with private claimants plight, We are bound to apply the law strictly and judiciously. This is the law and

it should prevail. Ito ang batas at ito ang dapat umiral.

All is not lost, however, for private claimants. While they may not be eligible to apply for judicial confirmation of imperfect title

under Section 48(b) of CA No. 141, as amended, this does not denote their automatic ouster from the residential, commercial, and other

areas they possess now classified as agricultural. Neither will this mean the loss of their substantial investments on their occupied alienable

lands. Lack of title does not necessarily mean lack of right to possess.

For one thing, those with lawful possession may claim good faith as builders of improvements. They can take steps to preserve or

protect their possession. For another, they may look into other modes of applying for original registration of title, such as by homestead[131] or

sales patent,[132] subject to the conditions imposed by law.

More realistically, Congress may enact a law to entitle private claimants to acquire title to their occupied lots or to exempt them

from certain requirements under the present land laws. There is one such bill[133] now pending in the House of Representatives. Whether that

bill or a similar bill will become a law is for Congress to decide.

In issuing Proclamation No. 1064, the government has taken the step necessary to open up the island to private ownership. This

gesture may not be sufficient to appease some sectors which view the classification of the island partially into a forest reserve as absurd. That

the island is no longer overrun by trees, however, does not becloud the vision to protect its remaining forest cover and to strike a healthy

balance between progress and ecology. Ecological conservation is as important as economic progress.

To be sure, forest lands are fundamental to our nations survival. Their promotion and protection are not just fancy rhetoric for

politicians and activists. These are needs that become more urgent as destruction of our environment gets prevalent and difficult to

control. As aptly observed by Justice Conrado Sanchez in 1968 in Director of Forestry v. Munoz:[134]

The view this Court takes of the cases at bar is but in adherence to public policy that should be followed with
respect to forest lands. Many have written much, and many more have spoken, and quite often, about the pressing need
for forest preservation, conservation, protection, development and reforestation. Not without justification. For, forests
constitute a vital segment of any country's natural resources. It is of common knowledge by now that absence of the
necessary green cover on our lands produces a number of adverse or ill effects of serious proportions. Without the trees,
watersheds dry up; rivers and lakes which they supply are emptied of their contents. The fish disappear. Denuded areas
become dust bowls. As waterfalls cease to function, so will hydroelectric plants. With the rains, the fertile topsoil is washed
away; geological erosion results. With erosion come the dreaded floods that wreak havoc and destruction to property
crops, livestock, houses, and highways not to mention precious human lives. Indeed, the foregoing observations should be
written down in a lumbermans decalogue.[135]

WHEREFORE, judgment is rendered as follows:

1. The petition for certiorari in G.R. No. 167707 is GRANTED and the Court of Appeals Decision in CA-G.R. CV No.

71118 REVERSED AND SET ASIDE.

2. The petition for certiorari in G.R. No. 173775 is DISMISSED for lack of merit. SO ORDERED.
JULIO FLORES (deceased), substituted by his heirs; G.R. No. 173365
BENITO FLORES(deceased), substituted by his heirs;
DOLORES FLORES and VIRGINIA FLORES-DALERE,
represented by their Attorney-in-Fact, JIMENA TOMAS,

Petitioners, Promulgated:

- versus -

MARCIANO BAGAOISAN, April 15, 2010

Respondent.

x------------------------------------------------------------------------------------x

DECISION

NACHURA, J.:

Petitioners seek a review of the March 29, 2006 Decision[1] and the June 20, 2006 Resolution of the Court of Appeals (CA), denying

their motion for reconsideration.

The case involves a 13,552-square meter portion of a parcel of land covered by Original Certificate of Title (OCT) No. P-11880[2] in

the name of the Heirs of Victor Flores, namely: Julio, Benito, Dolores, and Virginia, herein petitioners. OCT No. P-11880 was issued pursuant

to Homestead Patent No. 138892, given on November 12, 1973. This property is located in the Municipality of Piddig, Ilocos Norte.

On December 20, 1976, petitioners, together with their mother Luisa Viernes, executed a Deed of Confirmation and Quitclaim[3] in

favor of Vicente T. Lazo. Through this document, petitioners agreed to sell, cede, convey, grant, and transfer by way of QUITCLAIM the

subject property to Lazo. Thereafter, respondent, Marciano Bagaoisan, bought the subject property from Lazo, as evidenced by a Deed of

Absolute Sale dated February 20, 1977.[4]

On April 4, 1983, Viernes and petitioner Virginia Flores-Dalere executed a Palawag A Nasapataan (Affidavit), attesting to the fact

that they conveyed to Lazo the subject property through the Deed of Confirmation and Quitclaim. Affiants also attested that Lazo and his

predecessors-in-interest had been in possession of the disputed portion since 1940 and that the same was mistakenly included in the patent

application of Victor Flores.

On June 21, 1996, respondent filed an action for ownership, quieting of title, partition and damages against petitioners, praying that

he be declared as the true owner of the subject property and that the entire property covered by OCT No. P-11880 be partitioned among

them. In the Complaint, respondent asserted that he was a tenant of Lazo and that he had been working on the subjec0t property since time

immemorial. He said that, since he bought the property in 1977, he possessed the land as owner and paid real property tax thereon. He

claimed that the subject property was erroneously covered by OCT No. P-11880 and that petitioners have previously recognized such fact,

considering that they executed an affidavit acknowledging the erroneous inclusion of the property in their title. He averred that, lately,

petitioners had denied his ownership of the land and asserted their ownership thereof by working and harvesting the crops thereon.[5]

In answer, petitioners stated that they did not relinquish ownership or possession of the land to Lazo. While admitting that they

executed the Deed of Confirmation and Quitclaim in favor of Lazo, petitioners claimed that they were misled into signing the same, with Lazo

taking advantage of their lack of education. Petitioners contended that it was too late for respondent to assert title to the disputed portion

because the title covering the same had already become indefeasible one year after it was issued. [6]

On February 3, 2000, the Regional Trial Court rendered a decision, disposing as follows:

WHEREFORE, in view of the foregoing, judgment is hereby rendered ordering the defendants, jointly and
severally:

1. To recognize plaintiff Marciano Bagaoisan as owner of the 13,552 sq.m. parcel of land situated in Barrio
Maab-abucay (now Estancia) Municipality of Piddig, Ilocos Norte;

2. To cease and desist from further possession of said parcel of land and to immediately reconvey the same to
plaintiff;
 3. To pay said plaintiff such amount as would be the peso equivalent of 100 cavanes of palay per year, for the
loss of harvest he incurred in 1994, 1995, 1996, 1997, 1998 and 1999, computed as the price then
obtaining in said years; and

4. To pay plaintiff the amount of P20,000.00 as reasonable attorneys fees.No pronouncement as to costs.

SO ORDERED.[7]

On appeal, the CA upheld the validity of the Deed of Confirmation and Quitclaim. In light of petitioners admission that they signed

the deed after it was read to them, the CA dismissed their assertion that they did not know the contents of the document. It further declared

that the deed merely confirmed petitioners non-ownership of the subject property and it did not involve an alienation or encumbrance.

Accordingly, it concluded that the five-year prohibition against alienation of a property awarded through homestead patent did not apply.

The CA likewise rejected petitioners contention that the action was barred by prescription or laches. Citing Vital v. Anore,[8] the CA

held that where the registered owner knew that the property described in the patent and the certificate of title belonged to another, any

statute barring an action by the real owner would not apply, and the true owner might file an action to settle the issue of ownership.

The dispositive portion of the assailed March 29, 2006 Decision reads:

WHEREFORE, the appeal is hereby DISMISSED for lack of sufficient merit. The assailed 3 February 2000 decision
by the Regional Trial Court, Laoag City, in Civil Case No. 11048-14 is hereby AFFIRMED. SO ORDERED.[9]

The CA likewise denied petitioners motion for reconsideration in its Resolution dated June 20, 2006.[10]

Consequently, petitioners filed this petition for review, insisting that the Deed of Confirmation and Quitclaim is void as its contents

were not fully explained to them, and it violates Section 118 of the Public Land Act (Commonwealth Act No. 141), which prohibits the

alienation of lands acquired through a homestead patent.

The petition is meritorious.

Without going into petitioners allegation that they were unaware of the contents of the Deed of Confirmation and Quitclaim, we

nonetheless hold that the deed is void for violating the five-year prohibitory period against alienation of lands acquired through homestead

patent as provided under Section 118 of the Public Land Act, which states:

Sec. 118. Except in favor of the Government or any of its branches, units, or institutions, lands acquired under
free patent or homestead provisions shall not be subject to encumbrance or alienation from the date of the approval of the
application and for a term of five years from and after the date of issuance of the patent and grant, nor shall they become
liable to the satisfaction of any debt contracted prior to the expiration of said period, but the improvements or crops on the
land may be mortgaged or pledged to qualified persons, associations, or corporations.

No alienation, transfer, or conveyance of any homestead after five years and before twenty-five years after the
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.

We do not agree with the CA that the Deed of Confirmation and Quitclaim merely confirmed petitioners non-ownership of the subject

property. The deed uses the words sell, cede, convey, grant, and transfer. These words admit of no other interpretation than that the subject

property was indeed being transferred to Lazo.

The use of the words confirmation and quitclaim in the title of the document was an obvious attempt to circumvent the prohibition

imposed by law. Labeling the deed as a confirmation of non-ownership or as a quitclaim of rights would actually make no difference, as the

effect would still be the alienation or conveyance of the property. The act of conveyance would still fall within the ambit of the prohibition. To

validate such an arrangement would be to throw the door open to all possible fraudulent subterfuges and schemes that persons interested in

land given to a homesteader may devise to circumvent and defeat the legal provisions prohibiting their alienation within five years from the

issuance of the patent.[11]

 It bears stressing that the law was enacted to give the homesteader or patentee every chance to preserve for himself and his family

the land that the State had gratuitously given to him as a reward for his labor in cleaning and cultivating it.[12] Its basic objective, as the

Court had occasion to stress, is to promote public policy, that is to provide home and decent living for destitutes, aimed at providing a class of

independent small landholders which is the bulwark of peace and order.[13] Hence, any act which would have the effect of removing the

property subject of the patent from the hands of a grantee will be struck down for being violative of the law.

To repeat, the conveyance of a homestead before the expiration of the five-year prohibitory period following the issuance of the

homestead patent is null and void and cannot be enforced, for it is not within the competence of any citizen to barter away what public policy

by law seeks to preserve.[14] There is, therefore, no doubt that the Deed of Confirmation and Quitclaim, which was executed three years after

the homestead patent was issued, is void and cannot be enforced.

Furthermore, respondent failed to present sufficient evidence to surmount the conclusiveness and indefeasibility of the certificate of

title.

An OCT issued on the strength of a homestead patent partakes of the nature of a certificate issued in a judicial proceeding and

becomes indefeasible and incontrovertible upon the expiration of one year from the date of the promulgation of the Director of Lands order

for the issuance of the patent.[15] After the lapse of such period, the sole remedy of a landowner, whose property has been wrongfully or

erroneously registered in anothers name is to file an action for reconveyance so long as the property has not passed to an innocent purchaser

for value.[16] In order that an action for reconveyance based on fraud may prosper, it is essential for the party seeking reconveyance to prove,

by clear and convincing evidence, his title to the property and the fact of fraud.[17]

Respondent did not allege in his complaint or prove during the trial that fraud attended the registration of the subject property in

petitioners names. In fact, there was no allegation as to how petitioners were able to secure title to the property despite the alleged

ownership of respondents predecessor.

More importantly, respondent failed to prove that he has title to the subject property. He merely asserted that his predecessors-in-

interest had been in possession of the property since 1940. The basic presumption is that lands of whatever classification belong to the State

and evidence of a land grant must be well-nigh incontrovertible. The Public Land Act requires that the possessor or his predecessors-in-

interest must be in open, continuous, exclusive, and notorious possession and occupation of the land for at least thirty years. When these

conditions are complied with, the possessor is deemed to have acquired, by operation of law, a right to a government grant, without the

necessity of a certificate of title being issued. The land ceases to be a part of the public domain and beyond the authority of the Director of

Lands,[18] such that the latter would have no more right to issue a homestead patent to another person.

Respondent merely established that he had been in possession of the property and that he had been paying real property taxes

thereon since 1977. The only evidence on record attesting to the fact that respondent and his predecessors-in-interest had been in possession

of the property since 1940 was the affidavit executed by some of petitioners. This, however, would not suffice.

In closing, it would be well to mention that the execution of the Deed of Confirmation and Quitclaim within the five-year prohibitory

period also makes the homestead patent susceptible to cancellation, and the subject property being reverted to the public domain.[19] It is the

Solicitor General, on behalf of the government, who is by law mandated to institute an action for reversion.[20] Should the Solicitor General

decide to file such an action, it is in that action that petitioners defenses, particularly their alleged lack of knowledge of the contents of the

deed, will have to be resolved.

WHEREFORE, the petition is GRANTED. The March 29, 2006 Decision of the Court of Appeals and its June 20, 2006 Resolution

are REVERSED and SET ASIDE. The complaint for ownership, quieting of title and damages isDISMISSED, without prejudice to an action

for reversion that the Solicitor General may decide to file for the State. SO ORDERED.
ZENAIDA RAMOS-BALALIO, G.R. No. 168464
Petitioner,

- versus -

ROLANDO RAMOS,

EUSEBIO I. RAMOS and Promulgated:

EVANGELISTO GARCIA,

Respondents. January 23, 2006

x ---------------------------------------------------------------------------------------- x

DECISION

YNARES-SANTIAGO, J.:

This petition assails the Decision[1] of the Court of Appeals dated February 16, 2005 in CA-G.R. CV No. 58644 reversing the Decision[2] of the

Regional Trial Court (RTC) of Roxas, Isabela, Branch 23, dated July 17, 1996, in Civil Case No. Br. 23-357 which ruled that herein petitioner

Zenaida Ramos-Balalio had a superior right to possess Lot No. 204, Pls-15, situated at Muoz, Roxas, Isabela, as well as its Resolution[3] dated

June 14, 2005 denying the motion for reconsideration.

As culled from the records, petitioner Zenaida and her brother Alexander (now deceased) are the children of spouses Susana Bueno and

Abundio Ramos. The spouses started occupying Lot No. 204 in 1938. Abundio died in 1944. Susana met her second husband, respondent

Eusebio Ramos in 1946, with whom she had five children, one of whom is respondent Rolando.

In the interim, prior to 1958, Susana discovered that Felimon Domingo applied for a sales patent over the subject parcel of land which she

opposed. The Bureau of Lands resolved the dispute, thus:

In the light of the foregoing facts, it is clear that Felimon B. Domingo has not entered, possessed or cultivated
the land in question and therefore he has not acquired any preference right thereto. Upon the other hand contestant
Susana Bueno Vda. de Ramos and her children have sufficiently established their right of preference over the land except
the one hectare Cemetery site, on the basis of their continuous occupation and cultivation and their valuable
improvements introduced thereon.
Wherefore, it is ordered that the Sales Application No. 21992 of Felimon B. Domingo be as hereby it is rejected,
forfeiting in favor of the Government whatever amount have been paid on account thereof. The land in question shall be
subdivided so as to exclude therefrom the one hectare portion in the northwestern part of the land, which shall be reserved
as barrio cemetery site, while the remaining area is hereby allocated to SUSANA BUENO VDA DE RAMOS who shall file an
appropriate application therefore within sixty (60) days after the survey thereof at her own expense, it not appearing that
this Office has received the homestead (new) application allegedly filed by her for the same land.

SO ORDERED.[4]

It was alleged that as Susana accompanied her husband Eusebio, a soldier, wherever he was assigned, Susanas father, George Bueno, and

daughter, petitioner Zenaida continued the cultivation and possession of the subject land. Sometime later, Susana sold the land to petitioner

who, in turn, partitioned it among herself, her brother, Alexander, and respondent Rolando and his siblings. The partition was not registered

but Deeds of Sale were executed in favor of Rolando and Alexander.

Petitioner thereafter mortgaged her share; however, it came to her knowledge that respondents Rolando and Eusebio had usurped her share

and deprived the mortgagees of possession over the land. After settling the mortgage, petitioner filed a case for recovery of inheritance,

possession and damages with a petition for preliminary mandatory injunction.

The trial court had the land surveyed. Subdividing the land into Lots 204-A to 204-H[5] based on the actual possessor or occupant, the survey

plan revealed the following:

1. Plaintiff Zenaida Ramos Balalio has no possession, occupation, and cultivation whatsoever of lot 204, Pls-15;
2. Rolando Ramos is in possession and cultivation of lot 204-F, lot 204-G and lot 204-C, with a total area of 43,957 sq. m.,
more or less;
3. Eusebio Ramos is occupying and cultivating lot 204-A with an area of 4,994 sq. m., more or less;
4. Lot 204-B consisting of 17,685 sq. m., more or less, is possessed and cultivated by Evangelisto Garcia, another
intervenor. His occupation is very much less than the two (2) hectares sold to him by Alexander Ramos. It is
short by 2,311 sq. m., more or less;
5. The total area of the land in question, after deducting one (1) hectare occupied by the cemetery is 73,150 sq. m., more
or less.[6]

On July 17, 1996, the trial court rendered its decision holding that petitioner was deprived of her right to cultivation and possession

of her share of Lot No. 204 and thus ruled:

AS A CONSEQUENCE OF ALL THE FOREGOING, judgment is hereby rendered in favor of plaintiff, Zenaida Ramos
and against Rolando Ramos, defendant, and Eusebio Ramos, intervenor.

1. Ordering Eusebio Ramos to vacate lot 204-A and surrender it to Evangelisto Garcia because he is not entitled
to any portion of the lot in question, it being the conjugal property of the first marriage of Susana Bueno to Abundio
Ramos;

2. Evangelisto Garcia is adjudicated the first two (2) hectares from the North and East of the cemetery, as he
validly bought the area from Alexander Ramos. He is presently occupying only 17,689 sq. m., more or less. His possession
now is increased to two (2) hectares which includes the area being possessed by Eusebio Ramos;

3. The remaining portion of the share of Alexander Ramos is 4,410 sq. m., more or less. This is adjudicated in
favor of his heirs. This portion now corresponds to the area immediately South of the area of Evangelisto Garcia, the
partition being from East to West;

4. The middle portion consisting of 24,410 sq. m., more or less, and immediately South of the cemetery, and also
South of the portion adjudicated to the heirs of Alexander is now given to Zenaida Ramos Balalio as her valid share of lot
204, the partition being also East to West;

5. South of the share of Zenaida consisting also of 24,410 sq. m., more or less, is the valid share of Rolando
Ramos and his full blooded brother and sisters namely Robin, Corazon, Myrna and Mila, all surnamed Ramos;

6. Rolando Ramos and Eusebio Ramos are ordered jointly and severally to pay Zenaida Ramos:

a. Ten Thousand (P10,000.00) Pesos as attorneys fees;

b. One thousand Five Hundred (P1,500.00) Pesos as appearance fees of her lawyer;

c. Ten Thousand (P10,000.00) Pesos as incidental expenses relative to the case;

d. One Hundred Thousand Eight Hundred (P100,800.00) Pesos as the reasonable owners share of the
produce of the land of Zenaida Ramos from 1975 to the present, with an interest of 6% per
annum until fully paid;

7. The Clerk of Court and the Sheriff are ordered to repair to the land in question and partition said land in
accordance with the tenor of this decision;

8. And to pay the cost. SO ORDERED.[7]

On appeal, the Court of Appeals found that neither Zenaida nor Alexander complied with the homestead application requirements in order to

acquire superior vested right. As a consequence, it reversed the decision of the trial court, to wit:

As a consequence of the foregoing, the Court rules in favor of appellants as to the fourth error and finds that the
contract supposedly dividing that property among Zenaida, Rolando Ramos and Alexander Ramos cannot be enforced
because neither of the parties therein can claim any vested right over the subject parcel land which is still part of the
public domain.
Also, prescinding from the above ruling, the intervention of Eusebio Ramos and Evangelisto Garcia should
likewise be dismissed. As to Eusebio, since Susana never filed an application for homestead, her right never ripened to
ownership which she could have transmitted to her heirs. As to Evangelisto Garcia who supposedly purchased that share of
Alexander (an heir of Susana), since the vendor never inherited anything from Susana there was nothing which he
(Evangelisto) could have bought. In fine, neither of the intervenors could claim any right which they can enforce in court.

WHEREFORE, the Decision of the Regional Trial Court of Roxas, Isabela, Branch 23, in Civil Case No. Br. 23-357
is REVERSED and the Complaint filed by plaintiff-appellee as well as the respective Answer in Intervention of Eusebio
Ramos and Evangelisto Garcia are all hereby ordered DISMISSED. SO ORDERED.[8]
Hence, this petition on the following assigned errors:

7.1. THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED IN REVERSING THE TRIAL COURTS DECISION AND
DISMISSING THE PETITIONERS COMPLAINT.

7.2. THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN HOLDING THAT PETITIONER IS NOT IN PRIOR
POSSESSION OF THE SAID LAND, AND DECLARING THAT SHE HAS NO RIGHT WHATSOEVER TO THE DISPUTED
LAND.

7.3. THE HONORABLE COURT OF APPEALS ERRED IN IGNORING THE ISSUE OF ACCION PUBLICIANA IN THE CASE AT BAR
AND CONFINED ITSELF TO THE CLAIM OF RECOVERY OF INHERITANCE.[9]

The petition is partly meritorious.

Under the Regalian doctrine, all lands of the public domain belong to the State and those lands not appearing to be clearly within private

ownership are presumed to belong to the State.[10] Lands of the public domain are classified into agricultural, forest or timber, mineral lands,

and national parks. Alienable lands of the public domain shall be limited to agricultural lands. [11]

Commonwealth Act No. 141 (1936), or the Public Land Act, as amended by Presidential Decree No. 1073 (1977), remains to be the general

law governing the classification and disposition of alienable lands of the public domain. It enumerates the different modes of acquisition of

these lands and prescribes the terms and conditions to enable private persons to perfect their title to them. It is, therefore, the applicable law

to the case before us.

A homestead patent, such as the subject of the instant case, is one of the modes to acquire title to public lands suitable for agricultural

purposes. Under the Public Land Act, a homestead patent is one issued to any citizen of this country, over the age of 18 years or the head of

a family, and who is not the owner of more than 24[12] hectares of land in the country.[13] To be qualified, the applicant must show that he has

resided continuously for at least one year in the municipality where the land is situated and must have cultivated at least one-fifth of the land

applied for.[14]

In the case at bar, petitioner Zenaida asserts her right to a parcel of agricultural land that her parents Susana and Abundio had

possessed since 1938. She claims that, for some time, the cultivation of this land was left to her and her grandfather and that, following the

death of her father Abundio, the land was allegedly sold to her by her mother Susana.

Zenaidas argument is flawed because it assumes that her parents had perfected their title over the land and that they could validly

convey the same to third persons, whether by sale or by inheritance. However, a careful examination of the records shows that petitioner has

not satisfactorily established that a valid application for homestead patent was filed by her parents. The decision of the Bureau of Lands in

1958 only addressed Zenaidas familys right of preference over the land, in view of their possession and cultivation of the land. Nonetheless,

the Bureau of Lands ordered the filing of an appropriate application for its registration which indicates that as of that time, there was as yet

no valid application filed.[15]

The purported sale, therefore, between petitioner and her mother cannot be given effect, nor can it be a source of right for Zenaida,

because Susana did not have the authority to sell what did not belong to her. The invalidation of the sale consequently nullifies the partition

of the property among Zenaida, Alexander, and Rolando and his siblings because Zenaida could not have disposed of the land which she did

not own.
 For the same reason, neither Eusebio nor Rolando can claim any right whatsoever as heirs of Susana. Their claim evidently relies on

the provision of the Public Land Act which states:

Section 105. If at any time the applicant or grantee shall die before the issuance of the patent or the final grant
of the land, or during the life of the lease, or while the applicant or grantee still has obligations pending towards the
Government, in accordance with this Act, he shall be succeeded in his rights and obligations with respect to the
land applied for or granted or leased under this Act by his heirs in law, who shall be entitled to have issued to them the
patent or final concession if they show that they have complied with the requirements therefor, and who shall be
subrogated in all his rights and obligations for the purposes of this Act. (Emphasis added)

The reliance is misplaced because the cited provision speaks of an applicant, grantee, or lessee. Susana was not one of these. In her

lifetime, despite her possession and cultivation of the land, she failed to apply for a homestead patent and to acquire any vested right that

Eusebio or Rolando can inherit. As such, the land remains part of the public domain. Furthermore, Eusebio and Rolando cannot invoke their

prior possession and occupation of the land because the same cannot be considered as adverse, open, public, peaceful and to the exclusion of

all.

Hence, the subject land remains to be part of the public domain and rightfully belongs to the State. As held by the Court of Appeals,

none of the parties obtained a defensible title to the property which can be upheld by the Court. Nonetheless, the possession of the land is

different from the issue of its ownership. Petitioner argues that her petition may be treated as an accion publiciana and not merely an action

for recovery of inheritance.

An accion publiciana is an action for the recovery of the right to possess and is a plenary action in an ordinary civil proceeding to

determine the better right of possession of realty independently of title. [16] In this case, the issue is whether Zenaida, as an applicant for

public land, may be considered as having any right to the land occupied, which may entitle her to sue in courts for the return of the

possession thereof.

We find that Zenaida has proven prior possession of the portion of land she claims as her share, which possession antedates the

filing of the homestead application. She produced evidence showing that she has filed a verified application for the registration of the land

with the Bureau of Lands on August 10, 1971,[17] which is still pending. The documents remain uncontested and the application has not been

assailed by any of the parties to the case. She alleged that during the lifetime of her mother, she and her maternal grandfather cultivated and

occupied the land.

Moreover, Zenaida presented tax declarations both in her name and that of her predecessor-in-interest (mother Susana Bueno)

covering the property. Time and again, we have held that although tax declarations or realty tax payments of property are not conclusive

evidence of ownership, nevertheless, they are good indicia of possession in the concept of owner for no one in his right mind would be paying

taxes for a property that is not in his actual or at least constructive possession.[18] They constitute at least proof that the holder has a claim of

title over the property. The voluntary declaration of a piece of property for taxation purposes manifests not only ones sincere and honest

desire to obtain title to the property and announces his adverse claim against the State and all other interested parties, but also the intention

to contribute needed revenues to the Government.[19]

All told, petitioner Zenaidas uncontested and verified application for a homestead patent coupled with her open and notorious

occupation of the land convinces us of her preferential right to possess the land claimed, which entitles her to be protected by the law in such

possession.

WHEREFORE, the petition is PARTIALLY GRANTED. The Decision of the Court of Appeals dated February 16, 2005 is MODIFIED,

insofar as to grant petitioner Zenaida Ramos-Balalio preferential possession of the portion of Lot 204, Pls-15, situated in Muoz, Roxas,

Isabela, as delineated in the Decision of the Regional Trial Court of Roxas, Isabela, Branch 23, dated July 17, 1996. SO ORDERED.
G.R. No. 73002 December 29, 1986

THE DIRECTOR OF LANDS, petitioner,

vs.
INTERMEDIATE APPELLATE COURT and ACME PLYWOOD & VENEER CO. INC., ETC., respondents.

D. Nacion Law Office for private respondent.

NARVASA, J.:

The Director of Lands has brought this appeal by certiorari from a judgment of the Intermediate Appellate Court affirming a decision of the
Court of First Instance of Isabela, which ordered registration in favor of Acme Plywood & Veneer Co., Inc. of five parcels of land measuring
481, 390 square meters, more or less, acquired by it from Mariano and Acer Infiel, members of the Dumagat tribe.

The registration proceedings were for confirmation of title under Section 48 of Commonwealth Act No. 141 (The Public Land Act). as
amended: and the appealed judgment sums up the findings of the trial court in said proceedings in this wise:

1. That Acme Plywood & Veneer Co. Inc., represented by Mr. Rodolfo Nazario is a corporation duly organized in accordance with the
laws of the Republic of the Philippines and registered with the Securities and Exchange Commission on December 23, 1959;

2. That Acme Plywood & Veneer Co. Inc., represented by Mr. Rodolfo Nazario can acquire real properties pursuant to the provisions
of the Articles of Incorporation particularly on the provision of its secondary purposes (paragraph (9), Exhibit 'M-l');

3. That the land subject of the Land Registration proceeding was ancestrally acquired by Acme Plywood & Veneer Co., Inc., on
October 29, 1962, from Mariano Infiel and Acer Infiel, both members of the Dumagat tribe and as such are cultural minorities;

4. That the constitution of the Republic of the Philippines of 1935 is applicable as the sale took place on October 29, 1962;

5. That the possession of the Infiels over the land relinquished or sold to Acme Plywood & Veneer Co., Inc., dates back before the
Philippines was discovered by Magellan as the ancestors of the Infiels have possessed and occupied the land from generation to
generation until the same came into the possession of Mariano Infiel and Acer Infiel;

6. That the possession of the applicant Acme Plywood & Veneer Co., Inc., is continuous, adverse and public from 1962 to the
present and tacking the possession of the Infiels who were granted from whom the applicant bought said land on October 29, 1962,
hence the possession is already considered from time immemorial.

7. That the land sought to be registered is a private land pursuant to the provisions of Republic Act No. 3872 granting absolute
ownership to members of the non-Christian Tribes on land occupied by them or their ancestral lands, whether with the alienable or
disposable public land or within the public domain;

8. That applicant Acme Plywood & Veneer Co. Inc., has introduced more than Forty-Five Million (P45,000,000.00) Pesos worth of
improvements, said improvements were seen by the Court during its ocular investigation of the land sought to be registered on
September 18, 1982;

9. That the ownership and possession of the land sought to be registered by the applicant was duly recognized by the government
when the Municipal Officials of Maconacon, Isabela, have negotiated for the donation of the townsite from Acme Plywood & Veneer
Co., Inc., and this negotiation came to reality when the Board of Directors of the Acme Plywood & Veneer Co., Inc., had donated a
part of the land bought by the Company from the Infiels for the townsite of Maconacon Isabela (Exh. 'N') on November 15, 1979,
and which donation was accepted by the Municipal Government of Maconacon, Isabela (Exh. 'N-l'), during their special session on
November 22, 1979.

The Director of Lands takes no issue with any of these findings except as to the applicability of the 1935 Constitution to the matter at hand.
Concerning this, he asserts that, the registration proceedings have been commenced only on July 17, 1981, or long after the 1973
Constitution had gone into effect, the latter is the correctly applicable law; and since section 11 of its Article XIV prohibits private corporations
or associations from holding alienable lands of the public domain, except by lease not to exceed 1,000 hectares (a prohibition not found in the
1935 Constitution which was in force in 1962 when Acme purchased the lands in question from the Infiels), it was reversible error to decree
registration in favor of Acme Section 48, paragraphs (b) and (c), of Commonwealth Act No. 141, as amended, reads:

SEC. 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:

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 or 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.

(c) Members of the National Cultural minorities who by themselves or through their predecessors-in-interest have been in open.
continuous, exclusive and notorious possession and occupation of lands of the public domain suitable to agriculture, whether
disposable or not, under a bona fide claim of ownership for at least 30 years shall be entitled to the rights granted in subsection (b)
hereof.

The Petition for Review does not dispute-indeed, in view of the quoted findings of the trial court which were cited and affirmed by the
Intermediate Appellate Court, it can no longer controvert before this Court-the fact that Mariano and Acer Infiel, from whom Acme purchased
the lands in question on October 29, 1962, are members of the national cultural minorities who had, by themselves and through their
progenitors, possessed and occupied those lands since time immemorial, or for more than the required 30-year period and were, by reason
thereof, entitled to exercise the right granted in Section 48 of the Public Land Act to have their title judicially confirmed. Nor is there any
pretension that Acme, as the successor-in-interest of the Infiels, is disqualified to acquire and register ownership of said lands under any
provisions of the 1973 Constitution other than Section 11 of its Article XIV already referred to.
Given the foregoing, the question before this Court is whether or not the title that the Infiels had transferred to Acme in 1962 could be
confirmed in favor of the latter in proceedings instituted by it in 1981 when the 1973 Constitution was already in effect, having in mind the
prohibition therein against private corporations holding lands of the public domain except in lease not exceeding 1,000 hectares.

The question turns upon a determination of the character of the lands at the time of institution of the registration proceedings in 1981. If they
were then still part of the public domain, it must be answered in the negative. If, on the other hand, they were then already private lands, the
constitutional prohibition against their acquisition by private corporations or associations obviously does not apply.

In this regard, attention has been invited to Manila Electric Company vs. Castro-Bartolome, et al, 1 where a similar set of facts prevailed. In
that case, Manila Electric Company, a domestic corporation more than 60% of the capital stock of which is Filipino-owned, had purchased in
1947 two lots in Tanay, Rizal from the Piguing spouses. The lots had been possessed by the vendors and, before them, by their predecessor-
in-interest, Olimpia Ramos, since prior to the outbreak of the Pacific War in 1941. On December 1, 1976, Meralco applied to the Court of First
Instance of Rizal, Makati Branch, for confirmation of title to said lots. The court, assuming that the lots were public land, dismissed the
application on the ground that Meralco, a juridical person, was not qualified to apply for registration under Section 48(b) of the Public Land
Act which allows only Filipino citizens or natural persons to apply for judicial confirmation of imperfect titles to public land. Meralco appealed,
and a majority of this Court upheld the dismissal. It was held that:

..., the said land is still public land. It would cease to be public land only upon the issuance of the certificate of title to any Filipino
citizen claiming it under section 48(b). Because it is still public land and the Meralco, as a juridical person, is disqualified to apply for
its registration under section 48(b), Meralco's application cannot be given due course or has to be dismissed.

Finally, it may be observed that the constitutional prohibition makes no distinction between (on the one hand) alienable agricultural
public lands as to which no occupant has an imperfect title and (on the other hand) alienable lands of the public domain as to which
an occupant has on imperfect title subject to judicial confirmation.

Since section 11 of Article XIV does not distinguish, we should not make any distinction or qualification. The prohibition applies to
alienable public lands as to which a Torrens title may be secured under section 48(b). The proceeding under section 48(b)
'presupposes that the land is public' (Mindanao vs. Director of Lands, L-19535, July 30, 1967, 20 SCRA 641, 644).

The present Chief Justice entered a vigorous dissent, tracing the line of cases beginning with Carino in 1909 2thru Susi in 1925 3 down
to Herico in 1980, 4 which developed, affirmed and reaffirmed the doctrine that open, exclusive and undisputed possession of alienable public
land for the period prescribed by law creates the legal fiction whereby the land, upon completion of the requisite period ipso jure and without
the need of judicial or other sanction, ceases to be public land and becomes private property. That said dissent expressed what is the better
— and, indeed, the correct, view-becomes evident from a consideration of some of the principal rulings cited therein,

The main theme was given birth, so to speak, in Carino involving the Decree/Regulations of June 25, 1880 for adjustment of royal lands
wrongfully occupied by private individuals in the Philippine Islands. It was ruled that:

It is true that the language of articles 4 and 5 5 attributes title to those 'who may prove' possession for the necessary time and we
do not overlook the argument that this means may prove in registration proceedings. It may be that an English conveyancer would
have recommended an application under the foregoing decree, but certainly it was not calculated to convey to the mind of an Igorot
chief the notion that ancient family possessions were in danger, if he had read every word of it. The words 'may prove' (acrediten)
as well or better, in view of the other provisions, might be taken to mean when called upon to do so in any litigation. There are
indications that registration was expected from all but none sufficient to show that, for want of it, ownership actually gained would
be lost. The effect of the proof, wherever made, was not to confer title, but simply to establish it, as already conferred by the
decree, if not by earlier law. ...

That ruling assumed a more doctrinal character because expressed in more categorical language, in Susi:

.... In favor of Valentin Susi, there is, moreover, the presumption juris et de jure established in paragraph (b) of section 45 of Act
No. 2874, amending Act No. 926, that all the necessary requirements for a grant by the Government were complied with, for he has
been in actual and physical possession, personally and through his predecessors, of an agricultural land of the public domain openly,
continuously, exclusively and publicly since July 26, 1984, with a right to a certificate of title to said land under the provisions of
Chapter VIII of said Act. So that when Angela Razon applied for the grant in her favor, Valentin Susi had already acquired, by
operation of law not only a right to a grant, but a grant of the Government, for it is not necessary that a certificate of title should be
issued in order that said grant may be sanctioned by the courts, an application therefore is sufficient, under the provisions of section
47 of Act No. 2874. If by a legal fiction, Valentin Susi had acquired the land in question by a grant of the State, it had already
ceased to be of the public domain and had become private property, at least by presumption, of Valentin Susi, beyond the control of
the Director of Lands. Consequently, in selling the land in question of Angela Razon, the Director of Lands disposed of a land over
which he had no longer any title or control, and the sale thus made was void and of no effect, and Angela Razon did not thereby
acquire any right. 6

Succeeding cases, of which only some need be mentioned, likeof Lacaste vs. Director of Lands, 7 Mesina vs. Vda. de Sonza, 8 Manarpac vs.
Cabanatuan, 9 Miguel vs. Court of Appeals 10 and Herico vs. Dar, supra, by invoking and affirming the Susi doctrine have firmly rooted it in
jurisprudence.

Herico, in particular, appears to be squarely affirmative: 11

.... Secondly, under the provisions of Republic Act No. 1942, which the respondent Court held to be inapplicable to the petitioner's
case, with the latter's proven occupation and cultivation for more than 30 years since 1914, by himself and by his predecessors-in-
interest, title over the land has vested on petitioner so as to segregate the land from the mass of public land. Thereafter, it is no
longer disposable under the Public Land Act as by free patent. ....

xxx xxx xxx

As interpreted in several cases, when the conditions as specified in the foregoing provision are complied with, the possessor is
deemed to have acquired, by operation of law, a right to a grant, a government grant, without the necessity of a certificate of title
being issued. The land, therefore, ceases to be of the public domain and beyond the authority of the Director of Lands to dispose
of. The application for confirmation is mere formality, the lack of which does not affect the legal sufficiency of the title as would be
evidenced by the patent and the Torrens title to be issued upon the strength of said patent. 12

Nothing can more clearly demonstrate the logical inevitability of considering possession of public land which is of the character and duration
prescribed by statute as the equivalent of an express grant from the State than the dictum of the statute itself 13 that the possessor(s) "...
shall be conclusively presumed to have performed all the conditions essential to a Government grant and shall be entitled to a certificate of
title .... " No proof being admissible to overcome a conclusive presumption, confirmation proceedings would, in truth be little more than a
formality, at the most limited to ascertaining whether the possession claimed is of the required character and length of time; and registration
thereunder would not confer title, but simply recognize a title already vested. The proceedings would not originally convert the land from
public to private land, but only confirm such a conversion already affected by operation of law from the moment the required period of
possession became complete. As was so well put in Carino, "... (T)here are indications that registration was expected from all, but none
sufficient to show that, for want of it, ownership actually gained would be lost. The effect of the proof, wherever made, was not to confer title,
but simply to establish it, as already conferred by the decree, if not by earlier law."

If it is accepted-as it must be-that the land was already private land to which the Infiels had a legally sufficient and transferable title on
October 29, 1962 when Acme acquired it from said owners, it must also be conceded that Acme had a perfect right to make such acquisition,
there being nothing in the 1935 Constitution then in force (or, for that matter, in the 1973 Constitution which came into effect later)
prohibiting corporations from acquiring and owning private lands.

Even on the proposition that the land remained technically "public" land, despite immemorial possession of the Infiels and their ancestors,
until title in their favor was actually confirmed in appropriate proceedings under the Public Land Act, there can be no serious question of
Acmes right to acquire the land at the time it did, there also being nothing in the 1935 Constitution that might be construed to prohibit
corporations from purchasing or acquiring interests in public land to which the vendor had already acquired that type of so-called
"incomplete" or "imperfect" title. The only limitation then extant was that corporations could not acquire, hold or lease public agricultural
lands in excess of 1,024 hectares. The purely accidental circumstance that confirmation proceedings were brought under the aegis of the
1973 Constitution which forbids corporations from owning lands of the public domain cannot defeat a right already vested before that law
came into effect, or invalidate transactions then perfectly valid and proper. This Court has already held, in analogous circumstances, that the
Constitution cannot impair vested rights.

We hold that the said constitutional prohibition 14 has no retroactive application to the sales application of Binan Development Co.,
Inc. because it had already acquired a vested right to the land applied for at the time the 1973 Constitution took effect.

That vested right has to be respected. It could not be abrogated by the new Constitution. Section 2, Article XIII of the 1935
Constitution allows private corporations to purchase public agricultural lands not exceeding one thousand and twenty-four hectares.
Petitioner' prohibition action is barred by the doctrine of vested rights in constitutional law.

xxx xxx xxx

The due process clause prohibits the annihilation of vested rights. 'A state may not impair vested rights by legislative enactment, by
the enactment or by the subsequent repeal of a municipal ordinance, or by a change in the constitution of the State, except in a
legitimate exercise of the police power'(16 C.J.S. 1177-78).

xxx xxx xxx

In the instant case, it is incontestable that prior to the effectivity of the 1973 Constitution the right of the corporation to purchase
the land in question had become fixed and established and was no longer open to doubt or controversy.

Its compliance with the requirements of the Public Land Law for the issuance of a patent had the effect of segregating the said land
from the public domain. The corporation's right to obtain a patent for the land is protected by law. It cannot be deprived of that
right without due process (Director of Lands vs. CA, 123 Phil. 919).<äre||anº•1àw> 15

The fact, therefore, that the confirmation proceedings were instituted by Acme in its own name must be regarded as simply another
accidental circumstance, productive of a defect hardly more than procedural and in nowise affecting the substance and merits of the right of
ownership sought to be confirmed in said proceedings, there being no doubt of Acme's entitlement to the land. As it is unquestionable that in
the light of the undisputed facts, the Infiels, under either the 1935 or the 1973 Constitution, could have had title in themselves confirmed and
registered, only a rigid subservience to the letter of the law would deny the same benefit to their lawful successor-in-interest by valid
conveyance which violates no constitutional mandate.

The Court, in the light of the foregoing, is of the view, and so holds, that the majority ruling in Meralco must be reconsidered and no longer
deemed to be binding precedent. The correct rule, as enunciated in the line of cases already referred to, is that alienable public land held by a
possessor, personally or through his predecessors-in-interest, openly, continuously and exclusively for the prescribed statutory period (30
years under The Public Land Act, as amended) is converted to private property by the mere lapse or completion of said period, ipso jure.
Following that rule and on the basis of the undisputed facts, the land subject of this appeal was already private property at the time it was
acquired from the Infiels by Acme. Acme thereby acquired a registrable title, there being at the time no prohibition against said corporation's
holding or owning private land. The objection that, as a juridical person, Acme is not qualified to apply for judicial confirmation of title under
section 48(b) of the Public Land Act is technical, rather than substantial and, again, finds its answer in the dissent in Meralco:

6. To uphold respondent judge's denial of Meralco's application on the technicality that the Public Land Act allows only citizens of the
Philippines who are natural persons to apply for confirmation of their title would be impractical and would just give rise to
multiplicity of court actions. Assuming that there was a technical error not having filed the application for registration in the name of
the Piguing spouses as the original owners and vendors, still it is conceded that there is no prohibition against their sale of the land
to the applicant Meralco and neither is there any prohibition against the application being refiled with retroactive effect in the name
of the original owners and vendors (as such natural persons) with the end result of their application being granted, because of their
indisputable acquisition of ownership by operation of law and the conclusive presumption therein provided in their favor. It should
not be necessary to go through all the rituals at the great cost of refiling of all such applications in their names and adding to the
overcrowded court dockets when the Court can after all these years dispose of it here and now. (See Francisco vs. City of Davao)

The ends of justice would best be served, therefore, by considering the applications for confirmation as amended to conform to the
evidence, i.e. as filed in the names of the original persons who as natural persons are duly qualified to apply for formal confirmation
of the title that they had acquired by conclusive presumption and mandate of the Public Land Act and who thereafter duly sold to the
herein corporations (both admittedly Filipino corporations duly qualified to hold and own private lands) and granting the applications
for confirmation of title to the private lands so acquired and sold or exchanged.

There is also nothing to prevent Acme from reconveying the lands to the Infiels and the latter from themselves applying for confirmation of
title and, after issuance of the certificate/s of title in their names, deeding the lands back to Acme. But this would be merely indulging in
empty charades, whereas the same result is more efficaciously and speedily obtained, with no prejudice to anyone, by a liberal application of
the rule on amendment to conform to the evidence suggested in the dissent in Meralco.

While this opinion seemingly reverses an earlier ruling of comparatively recent vintage, in a real sense, it breaks no precedent, but only
reaffirms and re-established, as it were, doctrines the soundness of which has passed the test of searching examination and inquiry in many
past cases. Indeed, it is worth noting that the majority opinion, as well as the concurring opinions of Chief Justice Fernando and Justice Abad
Santos, in Meralco rested chiefly on the proposition that the petitioner therein, a juridical person, was disqualified from applying for
confirmation of an imperfect title to public land under Section 48(b) of the Public Land Act. Reference to the 1973 Constitution and its Article
XIV, Section 11, was only tangential limited to a brief paragraph in the main opinion, and may, in that context, be considered as
essentially obiter. Meralco, in short, decided no constitutional question.

WHEREFORE, there being no reversible error in the appealed judgment of the Intermediate Appellate Court, the same is hereby affirmed,
without costs in this instance. SO ORDERED.
G.R. No. 157306 November 25, 2005

REPUBLIC OF THE PHILIPPINES, Petitioner,

vs.
ANATALIA ACTUB TIU ESTONILO and ANDREA ACTUB TIU PO (in Substitution of NAZARIA BOMBEO),Respondents.

DECISION

PANGANIBAN, J.:

To segregate portions of the public domain as reservations for the use of the Republic of the Philippines or any of its branches, like the Armed
Forces of the Philippines, all that is needed is a presidential proclamation to that effect. A court judgment is not necessary to make the
proclamation effective or valid.

The Case

Before us is a Petition for Review1 under Rule 45 of the Rules of Court, seeking to reverse and set aside the February 21, 2003 Decision2 of
the Court of Appeals (CA) in CA-GR CV No. 66807. The assailed CA Decision disposed as follows:

"WHEREFORE, the foregoing premises considered, the ruling of the trial court is hereby AFFIRMED."3

The Facts

The antecedents were summarized by the CA as follows:

"This case originated from an application for registration of a parcel of land known as Lot No. 4318 of the cadastral survey of Cagayan de Oro
consisting [of] an area of 357,866 square meters, filed by [the] original [a]pplicant, Nazaria Bombeo with the defunct Court of First Instance
of Misamis Oriental on July 22, 1954. In her application, Bombeo claimed that said parcel of land was previously owned and possessed by a
certain Rosendo Bacas since 1894 until it was sold to her by the heirs of Rosendo Bacas, represented by their attorney-in-fact and heir
himself, Calistro Bacas by virtue of an Absolute Sale of Realty (Exhibit ‘A’) on June 14, 1954.

"After due notice and publication of said application, only the Provincial Fiscal of Misamis Oriental, in behalf of the Chief of Staff of the Armed
Forces of the Philippines [AFP] and the Director of [the] Bureau of Land[s] filed its opposition thereto, alleging that Lot 4318 is not a
registrable land pursuant to Presidential Proclamation No. 265, which took effect on March 31, 1938, and which declared Lot 4318 reserved
for the use of the Philippine Army, to wit:

‘PRESIDENTIAL PROCLAMATION NO. 265. RESERVING FOR THE USE OF THE PHILIPPINE ARMY THREE PARCELS OF THE PUBLIC DOMAIN
SITUATED IN THE BARRIOS OF BULUA AND CARMEN, MUNICIPALITY OF CAGAYAN, PROVINCE OF MISAMIS ORIENTAL, ISLAND OF
MINDANAO.

Upon the recommendation of the Secretary of Agriculture and Commerce and pursuant to the provision of section eighty-three of
Commonwealth Act Number One Hundred and Forty-one, I hereby withdraw from sale of settlement and reserve for the use of the Philippine
Army, under the administration of the Chief of Staff subject to private rights, if any thereby, the following described parcels of public domain,
situated in the barrios of Bulua and Carmen, Municipality of Cagayan, Province of Misamis Oriental, Island of Mindanao, and particularly
described in Bureau of Lands SWO-15234, to wit:

Lot No. 4318. – x x x.

Containing an area of 354,377 square meters.’

"During the initial hearing set on February 12, 1955, an Order of General Default was issued by the lower court. On July 29, 1959, Bombeo
died and was substituted by her daughter Cipriana Actub Tiu who eventually died on December 5, 1990. Thereafter, due to intervening deaths
of the parties, the case literally went to slumber until it was re-raffled to the Regional Trial Court (Branch 17) of Misamis Oriental on October
16, 1991 and was pursued anew by the daughters of Cipriana Actub Tiu, namely, Anatalia Actub Tiu Estonilo and Andrea Actub Tiu Po. On the
other hand, Oppositors Bureau of Lands and Chief of Staff of the Armed Forces of the Philippines, in behalf of the Republic of the Philippines;
were represented by the Provincial Prosecutor Florencia Abbu and Major Raul Llacuna of JAGO [Judge Advocate General’s Office]. On May 27,
1994, the trial court confirmed title over Lot 4318 to Nazaria Bombeo substituted by her heirs Anatalia Actub Tiu Estonilo and Andrea Actub
Tiu Po and ordered registration thereof under the names of the latter. Consequently, Oppositors Bureau of Lands and Chief of Staff of Armed
Forces of the Philippines, through the Solicitor General’s Office; filed an appeal to said decision x x x.

"During the pendency of the appeal, however, Presidential Proclamation No. 3304 took effect on June 20, 2000, excluding Lot 4318 from the
operation of Presidential Proclamation No. 265[.]

xxxxxxxxx

"In view of the aforesaid decree, x x x [respondents urged the CA] to finally put to rest the controversy in their favor considering that the
opposition of the Republic has no longer any basis."5

Ruling of the Court of Appeals

The Court of Appeals ruled that Presidential Proclamation No. 265 (Proc 265) failed to segregate effectively Lot 4318 as part of the military
reservation. The CA said that the proclamation was "not self-executory and self-adjudicating considering that there is a need to determine
private rights of claimants over lands sought to be reserved."

Moreover, the appellate court agreed with the trial court that respondents were able to establish with sufficient evidence their right to have
the land registered under their names. It acknowledged that possession by respondents’ predecessors-in-interest had ripened into an
imperfect title of ownership, subject to judicial confirmation. It added that ownership of the land would still be deemed vested in respondents,
"in view of their almost half a century of open, continuous, adverse and peaceful possession," even if possession by their predecessors-in-
interest were not taken into consideration.

Hence, this Petition.6

 Issues

Petitioner raises the following issues for our consideration:

"I.

Whether or not the Court of Appeals gravely erred in holding that Presidential Proclamation No. 265 did not effectively segregate Lot 4318
from the public domain.

"II.

Whether or not the Court of Appeals gravely erred in finding that respondents were able to establish that they have already acquired private
right over Lot 4318 which already amounted to a title.

"III.

Whether or not the Court of Appeals gravely erred in holding that the passage of Presidential Proclamation No. 330 which excludes from the
operation of Presidential Proclamation No. 265 Lot 4318 negates the claim of the AFP that the land in dispute is actively possessed and used
by it."7

In short, the main issue is whether respondents have duly proven their title to the subject land and may thus register it under the Public Land
Act.

The Court’s Ruling

The Petition is meritorious.

Main Issue:

Validity of Respondents’ Title

The Public Land Act8 requires applicants for confirmation of imperfect titles to prove (1) that the land is alienable public land; 9 and (2) that
their open, continuous, exclusive and notorious possession and occupation of the property has taken place either since time immemorial or for
the period prescribed by law. When the legal conditions are complied with, the possessor of the land -- by operation of law -- acquires a right
to a government grant, without necessitating the issuance of a certificate of title.10

After a meticulous review of the Decisions of both the trial and the appellate courts, as well as of the evidence on record, the Court finds that
respondents failed to satisfy the above legal requirements.

Nature of Lot 4318

It is not disputed that Proc 265 specifically reserved Lot 4318 for the use of the Philippine Army. Respondents maintain, though, that the land
was not effectively segregated as a military reservation by the Proclamation. Relying on Baloy v. CA,11 they allege that a petition for
reservation or a court judgment declaring the reservation is necessary to make Proc 265 effective. They maintain that the provision in the
Proclamation subjecting the reservation to private rights presumes that notice and hearing will be afforded to all persons claiming ownership
rights over the land. Otherwise, the reservation would amount to a deprivation of property without due process of law. They further allege
that the AFP failed to observe these requirements, thus causing the reservation to be ineffectual.

Petitioner, however, argues that the Public Land Act does not require a judicial order to create a military reservation. It contends that the
proviso requiring the reservation to be subject to private rights means that persons claiming rights over the reserved land are not precluded
from proving their claims. It contends further that respondents were afforded due process when their application for registration of title to Lot
4318 was heard by the lower courts.

We agree with petitioner. The segregation of land for a public purpose is governed by the Public Land Act, the pertinent provisions of which
are as follows:

"SECTION 83. Upon the recommendation of the Secretary of Agriculture and Natural Resources, the President may designate by proclamation
any tract or tracts of land of the public domain as reservations for the use of the Republic of the Philippines or of any of its branches, or of the
inhabitants thereof, in accordance with regulations prescribed for this purposes, or for quasi-public uses or purposes when the public interest
requires it, including reservations for highways, rights of way for railroads, hydraulic power sites, irrigation systems, communal pastures
or leguas comunales,
public parks, public quarries, public fishponds, workingmen's village and other improvements for the public benefit."

"SECTION 86. A certified copy of every proclamation of the President issued under the provisions of this title shall be forwarded to the
Director of Lands for record in his office, and a copy of this record shall be forwarded to the Register of Deeds of the province or city where
the land lies. Upon receipt of such certified copy, the Director of Lands shall order the immediate survey of the proposed reservation if the
land has not yet been surveyed, and as soon as the plat has been completed, he shall proceed in accordance with the next following section."

"SECTION 87. If all the lands included in the proclamation of the President are not registered under the Land Registration Act, the Solicitor
General, if requested to do so by the Secretary of Agriculture and Natural Resources, shall proceed in accordance with the provision of Section
fifty-three of this Act."

"SECTION 53. It shall be lawful for the Director of Lands, whenever in the opinion of the President the public interests shall require it, to
cause to be filed in the proper Court of First Instance, through the Solicitor General or the officer acting in his stead, a petition against the
holder, claimant, possessor, or occupant of any land who shall not have voluntarily come in under the provisions of this chapter or of the Land
Registration Act, stating in substance that the title of such holder, claimant, possessor, or occupant is open to discussion; or that the
boundaries of any such land which has not been brought into court as aforesaid are open to question; or that it is advisable that the title to
such lands be settled and adjudicated, and praying that the title to any such land or the boundaries thereof or the right to occupancy thereof
be settled and adjudicated. The judicial proceedings under this section shall be in accordance with the laws on adjudication of title in cadastral
proceedings."

Clearly, under the above provisions, only a positive act of the President is needed to segregate a piece of land for a public purpose. It must be
noted that while Section 53 grants authority to the director of lands -- through the solicitor general -- to file a petition against claimants of
the reserved land, the filing of that petition is not mandatory. The director of lands is required to file a petition only "whenever in the opinion
of the President public interest requires it."

Inapplicable is the ruling in Baloy v. CA12 requiring, after due notice and hearing, a judicial declaration of reservation. The subject of the
application for registration in Baloy was originally private land, as evidenced by a possessory information title issued in the applicants’ favor
during the Spanish era. As will be explained shortly, Lot 4318 in the present case is unquestionably public land. The only issue is whether
respondents have acquired title to the property.

Moreover, the governing law in Baloy was Act 627.13 Under the provisions of that law, the private character of the land shall be respected
absent any court order declaring that the property has become public. In the case before us, Proc 265 was issued pursuant to Commonwealth
Act (CA) No. 141. Accordingly, only a positive act of the President is required to create a government reservation.

Verily, the Proclamation successfully segregated Lot 4318 as a military reservation. Consequently, respondents could not have validly
occupied it in 1954, because it was considered inalienable14 since its reservation in 1938.

Respondents’ Period of Possession

Notwithstanding the reservation in 1938 of Lot 4318 for military use, respondents maintain their entitlement to have it registered under their
names. They allege that their predecessors-in-interest were already in adverse, open, peaceful and continuous possession of the property for
over 30 years prior to 1938. Thus, they conclude that their imperfect title had already attached long before the issuance of the Proclamation
segregating the land as a military reservation.

We are not convinced. As a rule, the factual findings of the trial court, when affirmed by the appellate court, are conclusive and binding on
this Court. To this rule, however, there are settled exceptions; for instance, when the judgment assailed is not supported by sufficient
evidence or is based on a misapprehension of facts.15 We find that these exceptions apply here.

Land that has not been acquired from the government, either by purchase or by grant, belongs to the State as part of the public
domain.16 For this reason, imperfect titles to agricultural lands are subjected to rigorous scrutiny before judicial confirmation is granted.17 In
the same manner, persons claiming the protection of "private rights" in order to exclude their lands from military reservations must show by
clear and convincing evidence that the pieces of property in question have been acquired by a legal method of acquiring public lands.18

In granting respondents judicial confirmation of their imperfect title, the trial and the appellate courts gave much weight to the tax
declarations presented by the former. However, while the tax declarations were issued under the names of respondents’ predecessors-in-
interest, the earliest one presented was issued only in 1954.19 The Director, Lands Management Bureau v. CA20 held thus:

"x x x. Tax receipts and tax declarations are not incontrovertible evidence of ownership. They are mere indicia of [a] claim of ownership.
In Director of Lands vs. Santiago:

‘x x x [I]f it is true that the original owner and possessor, Generosa Santiago, had been in possession since 1925, why were the subject lands
declared for taxation purposes for the first time only in 1968, and in the names of Garcia and Obdin? For although tax receipts and
declarations of ownership for taxation purposes are not incontrovertible evidence of ownership, they constitute at least proof that the holder
had a claim of title over the property.’"21

In addition, the lower courts credited the alleged prior possession by Calixto and Rosendo Bacas, from whom respondents’ predecessors had
purportedly bought the property. This alleged prior possession, though, was totally devoid of any supporting
evidence on record. Respondents’ evidence hardly supported the conclusion that their predecessors-in-interest had been in possession of the
land since "time immemorial."

Moreover, as correctly observed by the Office of the Solicitor General, the evidence on record merely established the transfer of the property
from Calixto Bacas to Nazaria Bombeo. The evidence did not show the nature and the period of the alleged possession by Calixto and Rosendo
Bacas. It is important that applicants for judicial confirmation of imperfect titles must present specific acts of ownership to substantiate their
claims; they cannot simply offer general statements that are mere conclusions of law rather than factual evidence of possession.22

It must be stressed that respondents, as applicants, have the burden of proving that they have an imperfect title to Lot 4318. Even the
absence of opposition from the government does not relieve them of this burden.23 Thus, it was erroneous for the trial and the appellate
courts to hold that the failure of the government to dislodge respondents, judicially or extrajudicially, from the subject land since 1954
already amounted to a title.

In this connection, the Court reiterates the following ruling in Director of Lands v. Agustin:24

"x x x. The petitioner is not necessarily entitled to have the land registered under the Torrens system simply because no one appears to
oppose his title and to oppose the registration of his land. He must show, even though there is no opposition, to the satisfaction of the court,
that he is the absolute owner, in fee simple. Courts are not justified in registering property under the Torrens system, simply because there is
no opposition offered. Courts may, even in the absence of any opposition, deny the registration of the land under the Torrens system, upon
the ground that the facts presented did not show that the petitioner is the owner, in fee simple, of the land which he is attempting to have
registered."

WHEREFORE, the Petition is GRANTED, and the assailed Decision of the Court of Appeals is REVERSED andSET ASIDE. The segregation of
Lot 4318 as part of a military reservation is declared VALID. No pronouncement as to costs. SO ORDERED.
G.R. No. 160145 November 11, 2005

REPUBLIC OF THE PHILIPPINES, Petitioner,

vs.
PEDRO O. ENCISO, Respondent.

DECISION

CALLEJO, SR., J.:

Before us is a petition for review on certiorari under Rule 45 of the Rules of Court, as amended, assailing the Decision1 of the Court of Appeals
(CA) dated September 26, 2003, which affirmed the Decision2 of the Regional Trial Court (RTC), Iba, Zambales, Branch 71, promulgated on
July 31, 2001 in LRC Case No. RTC-N-75-I. The CA and the trial court adjudicated Lot No. 2278-A, Cad. 652-D, Masinloc Cadastre in favor of
respondent Pedro O. Enciso, pursuant to Section 29 of Presidential Decree (P.D.) No. 1529.

The facts, as culled from the records of the case, show that on April 24, 2000, the respondent, alleging to be the owner in fee simple of a
parcel of residential land located in Barangay South Poblacion, Masinloc, Zambales, filed a petition for land registration before the RTC of Iba,
Zambales. The lot is described as follows:

A parcel of land (Lot 2278-A of the subdivision plan Csd-03-012562-D being a portion of Lot 2278, Cad. 652-D L.R.C. Rec. No.), situated in
the Barrio of South Poblacion, Municipality of Masinloc, Province of Zambales. Bounded on the NW., along line 1-2 by Sta. Lucia Street; on the
NE., along line 2-3 by Capt. Albright Street; on the SE. & SW. along line 3-4-1 by Lot 2278-B of the subd. plan. Beginning at a point marked
"1" on plan being N. 39 deg. 35’E., 12.05 m. from BLLM.1,

Cad. 652-D.

thence N. 16 deg. 13’E., 32.48 m. to point. 2;

thence S. 75 deg. 05’E., 44.83 m. to point. 3;

thence S. 16 deg. 19’W., 33.36 m. to point. 4;

thence N. 73 deg. 57’W., 44.76 m. to point. of;

beginning; containing an area of ONE THOUSAND FOUR HUNDRED SEVENTY-FIVE (1,475) square meters. All points referred to are indicated
on the plan and are marked on the ground by P.S. cyl. conc. mons. 15 x 40 cms. Bearings; true; date of original survey; Sept. 1927-July
1928 and that of the subdivision survey; July 22, 1999 and was approved on Jan. 20, 2000.3

The respondent averred, inter alia, that he acquired title to the said lot by virtue of an extrajudicial settlement of estate and quitclaim on
March 15, 1999; the said property is not tenanted or occupied by any person other than the respondent and his family who are in actual
physical possession of the same; and the respondent and his predecessors-in-interest have been in continuous, peaceful, open, notorious,
uninterrupted and adverse possession of the land in the concept of an owner for not less than 30 years immediately preceding the filing of the
application.4

Petitioner Republic of the Philippines, through the Office of the Solicitor General (OSG), opposed the application on the following grounds: (a)
neither the respondent nor his predecessors-in-interest have been in open, continuous, exclusive, and notorious possession and occupation of
the subject land since June 12, 1945 or prior thereto; (b) the respondent failed to adduce any muniment of title and/or the tax declaration
with the application to prove bona fide acquisition of the land applied for or its open, continuous, exclusive and notorious possession and
occupation thereof in the concept of owner since June 12, 1945 or prior thereto; (c) the alleged tax declaration adverted to in the application
does not appear to be genuine and the tax declarations indicate such possession to be of recent vintage; (d) the claim of ownership in fee
simple on the basis of Spanish title or grant can no longer be availed of by the respondent considering that he failed to file an appropriate
application for registration within the period of six months from February 16, 1976 as required by P.D. No. 892; and (e) the subject land is a
portion of the public domain belonging to the Republic of the Philippines which is not subject to private appropriation. 5

After ascertaining that the jurisdictional requirements for the application were done in accordance with the law during the initial hearing6 on
November 9, 2000, the trial court issued an Order of Default7 on January 3, 2001 against all persons with the exception of the government.

The respondent presented tax receipts to show that the property was declared for taxation purposes in his name. He also testified that he
acquired the property by inheritance from his deceased father, Vicente Enciso, who died on May 18, 1991. He then immediately took
possession of the property and constructed a house thereon in 1991. On March 15, 1999, he and his siblings executed an extrajudicial
settlement of estate where the land was adjudicated in his favor.

The respondent further narrated that the property was originally owned by the Municipality of Masinloc, Zambales. On October 5, 1968, the
municipality passed Resolution No. 71,8 undertaking to construct a road along the shoreline of the poblacion, but requiring landowners
adjoining the roads to share in the expenses for an inner wall adjacent to their lots. In view of this, the same resolution provided that:

WHEREAS, where the above landowners share in the construction of the roads, the same may be given the priority to acquire such additional
available areas by purchase, if such additional areas are not needed by the government for public use, the advances of the landowners as a
result of his [sic] construction (inner wall) be considered as price of the land, provided that the cost and value of the inner wall exceeds the
assessed value of the land, and if the cost of the inner wall is less than the assessed value of the land, the landowners will have to pay the
corresponding balance to the government; …9

On March 8, 1969, the Municipality of Masinloc, Zambales passed supplementary Resolution No. 102,10 which stated that in consideration of
the financial assistance extended by the abutting property owners, and because the government no longer needed the additional areas for
public use, the municipality was authorizing the Municipal Mayor to enter into and sign deeds of purchase between the municipality and the
landowners concerned. Consequently, the Municipal Council of Masinloc, Zambales unanimously approved Resolution No. 102-A11 dated March
15, 1969, authorizing its mayor to execute a deed of sale in favor of Honorato Edaño, covering a portion of the reclaimed lots no longer
needed for public use. Honorato was thus entitled to buy the lot for his help in carrying out the project envisioned in Resolution No. 71, and
after the submission of an itemized statement of the cost of the construction of the inner wall along Sta. Lucia Street.

Immediately thereafter, the Municipality of Masinloc, Zambales, represented by its Mayor, P.A. Edaño, executed a Deed of Absolute
Sale12 covering a piece of reclaimed land containing more or less 2,790 square meters in favor of Honorato Edaño. The deed stated that the
vendee constructed the inner wall needed to facilitate the fabrication of a portion of Sta. Lucia Street, which was opposite his lot, and the
extensions of Magsaysay and Capt. Albright Streets at a total expense of P1,683.80. Considering that the assessed value of the lot
was P2,092.50, or P408.70
more than the vendee spent for the construction of the inner wall, the vendee paid P408.70 to the vendor.

The respondent admitted that Honorato was his uncle, being his father’s half-brother.13 He further narrated that on December 9, 1980, the
spouses Honorato and Esperanza Edaño sold the lot to Vicente B. Enciso forP2,092.50 via a Deed of Absolute Sale.14 On January 17, 1981,
Vicente Enciso, Natividad Edaño Asuncion and Thelma A. Edaño entered into a Deed of Partition 15 involving the same parcel of land. Vicente
was awarded one-half of the total area of the property, 1,398 square meters, more or less; Natividad and Thelma got one-fourth each, or
approximately 697.5 square meters individually.

No cross-examination was conducted and no evidence was adduced by the government to controvert the application for registration.

On May 8, 2001, Director Felino M. Cortez of the Department on Registration submitted the Report16 of the Land Registration Authority,
informing the trial court that it was not in a position to verify whether the parcel of land subject of registration was already covered by a land
patent and previously approved isolated survey. Acting on this report, the trial court directed the Lands Management Bureau, the Community
Environment and Natural Resources Office of Iba, Zambales, and the Department of Environment and Natural Resources Regional Executive
Director for Region III, San Fernando, Pampanga, to submit a report on the status of the parcel of land.17

Without waiting for the final report, the trial court granted the application for registration on July 31, 2001, the dispositive portion of the
decision reads:

WHEREFORE, this Court, after confirming the Order of General Default entered into the record of this case on January 3, 2001 hereby
adjudicates Lot No. 2278-A, Cad. 652-D, Masinloc Cadastre, containing an area of 1,475 square meters, situated at Brgy. South Poblacion,
Masinloc, Zambales, Philippines, as appearing on the approved Plan No. Csd-03-012562-D (Exhibit "M") and also in the Technical Description
of said lot (Exhibit "K") in favor of the applicant whose address is at Brgy. South Poblacion, Masinloc, Zambales, Philippines, in accordance
with Section 29 of Presidential Decree No. 1529. This adjudication however is subject to the various easements/reservations provided for
under pertinent laws, Presidential Decree and/or Presidential Letters of Instruction, which should be annotated/projected in the title to be
issued.

Once this decision becomes final, let the corresponding decree and title be issued.

SO ORDERED.18

The trial court ruled that the respondent satisfactorily proved his ownership in fee simple, as well as the identity of the land sought to be
titled. Likewise, the trial court found that the respondent, as well as his predecessors-in-interest, had been in open, peaceful, continuous,
public, adverse, and under a bona fide claim of ownership. According to the trial court, there was no evidence that the subject parcel of land
was within any government reservation, or that the applicant was disqualified from owning real property under the Constitution.19

The Republic of the Philippines appealed the case before the CA, contending that the trial court erred in granting the application despite his
failure to prove registrable title over Lot No. 2278-A.

The CA disposed of the appeal on September 26, 2003 and affirmed the decision of the trial court. The fallo of the decision reads:

WHEREFORE, premises considered, the assailed decision dated July 31, 2001 of the RTC, Branch 71 of Iba, Zambales in LRC Case No. RTC-
N-75-1 is hereby AFFIRMED. SO ORDERED.20

The petitioner dispensed with the filing of a motion for reconsideration and forthwith filed the instant petition.

The OSG assigned the following error to the appellate court:

THE COURT OF APPEALS ERRED ON A QUESTION OF LAW IN GRANTING RESPONDENT’S PETITION FOR REGISTRATION SANS ANY SHOWING
THAT THE SUBJECT PROPERTY WAS PREVIOUSLY DECLARED ALIENABLE AND DISPOSABLE LANDS OF THE PUBLIC DOMAIN. 21

The petitioner contends that the first and primordial element in order to warrant the registration of title is to show that the land must be an
alienable and disposable land of the public domain. On this note, the petitioner believes that the respondent failed to adduce any evidence to
show that the subject land was already previously declared part of such alienable and disposable land of the public domain. Furthermore, the
petitioner adds that under the Regalian doctrine, all lands of the public domain belong to the State, and those not otherwise appearing to be
clearly within private ownership are presumed to belong to it.

In his comment to the petition, the respondent asserts that the CA was correct in affirming the decision of the land registration court. The
respondent cites the following justification of the CA in supporting his claim over Lot No. 2278-A:

Records reveal that subject land is a residential land owned by the Municipality of Masinloc, Zambales. The Municipality of Masinloc, through
Resolutions 71, 102 and 102-A-29 sold the subject land to Honorato Edaño as evidenced by the Deed of Absolute Sale dated March 31, 1969
executed by the Municipal Mayor.

Article 423 of the Civil Code provides that:

"Art. 423. The property of provinces, cities, and municipalities is divided into property for public use and patrimonial property."

Properties of political subdivision[s] which are patrimonial in character may be alienated. By analogy, when a municipality’s properties for
public use are no longer intended for such use, the same become patrimonial and may be the subject of a contract. Thus, the Deed of
Absolute Sale executed by and between the Municipal Mayor of Masinloc and Honorato Edaño was a valid contract. Subject land was likewise
sold by Honorato Edaño to petitioner-appellee’s father, Vicente Enciso, by virtue of a Deed of Absolute Sale. From then, subject land changed
hand until it was acquired by petitioner-appellee when his siblings executed an Extrajudicial Partition assigning said land to him. It was
declared for taxation purposes in his name under Tax Declaration No. 007-0700R. …

Subject land was reclassified as residential. It was already segregated from the public domain and assumed the character of private
ownership. It was reclaimed by the Municipality of Masinloc and eventually adjudicated to Honorato Edaño. The Municipality of Masinloc must
have been in possession of the subject land even before 1969 considering that it was originally surveyed way back in 1927-1928. In the
exercise of its proprietary right, the Municipality of Masinloc validly conveyed the subject land to petitioner-appellee’s predecessors-in-
interest. Petitioner-appellee’s possession and occupation of the subject land is continuous, public, adverse and uninterrupted and in the
concept an owner and no other person claimed possession and ownership of the same. Article 1137 of the Civil Code provides:

"Art. 1137. Ownership and other real rights over immovables also prescribed (sic) through uninterrupted adverse possession thereof for thirty
years, without need of titles or of good faith."
Parenthetically, petitioner-appellee’s possession tacked with that of his predecessors-in-interest already complied with the thirty (30)-year
requirement of open, continuous, exclusive and notorious possession required under the law.

Prescinding from the foregoing, petitioner-appellee sufficiently and satisfactorily proved his real and absolute ownership in fee simple; that he
has a registrable title over the subject land and that he complied with the requirements under the law to warrant registration of title over the
subject land.22

The petition is meritorious.

While it is the rule that findings of fact of appellate courts are conclusive upon this Court, among the recognized exceptions is where the
findings of fact are not supported by the record or are conspicuously erroneous as to constitute a serious abuse of discretion.23 This is the
situation in this case.

Section 14(1) of P.D. No. 1529, otherwise known as the Property Registration Decree, provides:

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.

Applicants for registration of title must therefore prove the following: (a) that the land forms part of the disposable and alienable 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. It is not disputed that the land sought to be registered
was originally part of the reclamation project undertaken by the Municipality of Masinloc, Zambales. The prevailing rule is that reclaimed
disposable lands of the public domain may only be leased and not sold to private parties. These lands remained sui generis, as the only
alienable or disposable lands of the public domain which the government could not sell to private parties except if the legislature passes a law
authorizing such sale. Reclaimed lands retain their inherent potential as areas for public use or public service. 24 The ownership of lands
reclaimed from foreshore areas is rooted in the Regalian doctrine, which declares that all lands and waters of the public domain belong to the
State.25 On November 7, 1936, the National Assembly approved Commonwealth Act No. 141, also known as the Public Land Act, compiling all
the existing laws on lands of the public domain. This remains to this day the existing and applicable general law governing the classification
and disposition of lands of the public domain. The State policy prohibiting the sale of government reclaimed, foreshore and marshy alienable
lands of the public domain to private individuals continued under the 1935 Constitution.

Indeed, there is nothing to support the respondent’s claim that the property "was reclassified as residential … already segregated from the
public domain and assumed the character of private ownership." At the moment, it is not clear as to when the proper authorities classified the
subject as alienable and disposable. It must be stressed that incontrovertible evidence must be presented to establish that the land subject of
the application is alienable or disposable.26

According to the CA, "the Municipality of Masinloc must have been in possession of the subject land even before 1969 considering that it was
originally surveyed way back in 1927-1928." This is not the kind of possession and occupation contemplated under the law. While the subject
property was still in the hands of the municipality, it was undeniably part of the public domain. The municipality cannot then be considered a
predecessor-in-interest of the applicant from whom the period of possession and occupation required by law may be reckoned with. Any other
interpretation would be dangerously detrimental to our national patrimony.

Even assuming that Honorato Edaño, the respondent’s earliest predecessor-in-interest, possessed the property as early as 1969, the
respondent’s claim must still fail, as he was unable to prove open, continuous, exclusive, and notorious possession and occupation of the
subject land under a bona fide claim of acquisition of ownership. As the Court ruled in Republic v. Alconaba:27

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 effect 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 nature as a party
would naturally exercise over his own property.

The respondent’s possession and that of his "predecessors-in-interest" will not suffice for purposes of judicial confirmation of title. What is
categorically required by law is open, continuous, exclusive, and notorious possession and occupation under a bona fide claim
of ownership since June 12, 1945 or earlier.

The evidence on record shows that a house was constructed on the subject property only in 1991. Certain discrepancies likewise surround the
application for registration: Honorato Edaño sold a parcel of land consisting of 2,790 square meters on December 9, 1980 to Vicente Enciso
alone; on January 17, 1981, Vicente Enciso, Natividad Edaño Asuncion and Thelma Edaño executed a deed of partition covering the same lot.
Why was there a need to partition the property if the entire land had already been sold to Vicente? The Court also notes that in the said deed
of partition, one-half of the total area of the land, which was 1,398 square meters, was adjudicated in favor of Vicente; however, in the
respondent’s application for registration, the land sought to be registered consists of 1,475 square meters.

Well-entrenched is the rule that the burden of proof in land registration cases rests on the applicant who must show clear, positive and
convincing evidence that his alleged possession and occupation were of the nature and duration required by law. Bare allegations, without
more, do not amount to preponderant evidence that would shift the burden to the oppositor.28

Evidently, the respondent failed to prove that (1) Lot No. 2278-A was classified as part of the disposable and alienable land of the public
domain; and (2) he and his predecessors-in-interest have been in open, continuous, exclusive, and notorious possession and occupation
thereof in the concept of owners since time immemorial, or from June 12, 1945.

WHEREFORE, the petition is GRANTED. The Decision of the Court of Appeals dated September 26, 2003 in CA-G.R. CV No. 72859
is REVERSED and SET ASIDE. Respondent Pedro O. Enciso’s application for registration and issuance of title to Lot No. 2278-A, Cad. 652-D,
Masinloc Cadastre, is hereby DISMISSED for lack of merit. SO ORDERED.
MARIA CARLOS, represented by G.R. No. 164823
TERESITA CARLOS VICTORIA,
Petitioner,

- versus -

Promulgated:
REPUBLIC OF THE PHILIPPINES,
Respondent. August 31, 2005

x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x

DECISION

Puno, J.:

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 Office of the Solicitor General, Oppositor-Appellant.

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

affecting 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 petitioners 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]

Cruzs testimony was corroborated by Daniel Castillo, 76 years old, Barangay Captain of Ususan, Taguig.[6]

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 brothers and

sisters. She characterized Maria Carloss 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 officers of the Department of Environment and Natural Resources (DENR) to establish that

the land in question is alienable and disposable.

Elvira R. Reynaldo, Records Officer, DENR Lands Management Bureau, appeared to certify that their office 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 applicants 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, 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 applicants mother and predecessor-in-interest sold
the subject land to Ususan Development Corporation. This was admitted by witness Teresita Carlos Victoria x x x

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 over the land in question. [11]

Hence, this petition.

We affirm 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 effect 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 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

4. That the VENDOR, by this Deed hereby transfer(s) possession of the property to the VENDEE. [15]

This contradicts petitioners 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.

ANECITO CALIMPONG and wife[NARCISA G.R. No. 163751
YGUAS],*
Petitioners,
Promulgated:
March 31, 2006
- versus -

HEIRS OF FILOMENA GUMELA represented by

FLAVIA MOLINA,
Respondent.
x - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -- - - - - - - - - - - - - - - - - - - - x

DECISION

CARPIO MORALES, J.:

Complying with the order issued on December 10, 1927 by Auxiliary Judge Mariano Buyson Lampa of the then Court of First Instance of

Zamboanga in Cadastral Case No. 5, G.L.R.O. Record No. 757 for the registration, in accordance with the provisions of the Land Registration

Act, of Lot No. 3013 of the Cadastral Survey of Dipolog (the lot) located in Anastacio, Polanco, Zamboanga del Norte in the names of

Filomena, Dionisio, Eusebio, Victoria, Fortunata, Serapio, Hipolito, Victor, Romualdo and Miguel, all surnamed Gumela [1] who were therein

decreed the owners in fee simple of the lot, Decree No. 342638 was issued on October 19, 1928, as attested by Enrique Altavas, Chief of the

General Land Registration Office. Despite the issuance of the decree, it appears that no certificate of title was issued and registered in the

names of the Gumelas.

By the claim of the Heirs of the Gumelas (the heirs), they hired an overseer in-charge of the cultivation of the lot.

In 1992, the heirs agreed to partition the estate of their predecessors-in-interest which includes the lot. They soon learned,

however, that the lot was being occupied by Anecito Calimpong (Calimpong).

It turned out that Calimpong filed in 1976 an application for Free Patent over the lot, which application he followed up with the Bureau of

Lands when his possession was disturbed by the heirs.

The heirs thus filed on July 27, 1993 before the Regional Trial Court of Dipolog City a complaint[2] for quieting of title, damages, with prayer

for preliminary injunction against Calimpong and his wife.

In the meantime, Provincial Environment and Natural Resources Officer (PENRO) Hilarion L. Ramos approved Calimpongs Free Patent

application, by Order[3] of August 17, 1993, in light of the following findings:

1. That the applicant is a natural-born citizen of the Philippines and is otherwise qualified to acquire public lands
through Free Patent;

2. That the land applied for has been classified as alienable and disposable and is subject to disposition under the
public land laws;

3. That upon investigation conducted by Deputy Public Land Inspector Marciano I. Carangan, whose report was duly
indorsed by LMO-III Designate, Ramon S. Pacatang, it was found out that the land applied for has been occupied and
cultivated by the applicant himself and/or through his predecessor-in-interest, since July 4, 1945 or prior thereto;

4. That the Notice of the acquisition of the land by the Applicant under this application has been published in
accordance with Law and that no person has proven a better right to the land applied for;

5. That the claim of the applicant is in all other respects, complete and there is no records in this office or any obstacle
to the issuance of patent; and

6. That there is no adverse claim involving the land applied for still pending determination in this office; (Underscoring
supplied)

Accordingly, the Order disposed as follows:

WHEREFORE, the occupation and cultivation of the land applied for as described in the caption hereof is hereby
confirmed and this application is then hereby entered in the records of this office as Free Patent Entry No. 372.

As the applicant has already complied with all the requirements of the law for the issuance of the corresponding
patent to the land, it is also hereby ordered that the necessary patent be prepared for the issuance in favor of the
Applicant.[4] (Underscoring supplied)

On August 17, 1993, Patent No. 09721093961 was issued to Calimpong which was forwarded to the Register of Deeds of

Zamboanga del Norte for registration and issuance of the corresponding certificate of title.[5]
 On August 19, 1993, Original Certificate of Title (OCT) No. P-33780[6] was issued by and registered in the Register of Deeds for

the Province of Zamboanga del Norte in the name of Calimpong.

To the complaint of the heirs, the spouses Calimpong alleged in their September 3, 1993 Answer with Counterclaim [7] that, inter

alia, assuming that the lot was adjudicated to the Gumelas, the same ha[d] been considered long abandoned because neither the

adjudicatee[s] nor any of the heirs have pursued the titling of the land, cultivation, improvement and possession. In any event, the spouses

Calimpong informed that a Free Patent and an OCT over the lot had already been issued in the name of Calimpong by the Register of Deeds

of Zamboanga del Norte.

The heirs thus filed a Motion to Admit Amended Complaint[8] impleading as additional defendants PENRO and the Register of Deeds

of Zamboanga del Norte, seeking as additional reliefs the nullification of OCT No. P-33780 and Free Patent No. 09721093961.

The amended complaint[9] was admitted by the Dipolog RTC, by Resolution[10] of February 8, 1994.

After trial on the merits, the trial court, by Decision[11] of February 28, 2001, rendered judgment in favor of the heirs. It held that, among

other things, the title of the heirs is based on a grant thereof to their predecessors-in-interest by the government in cadastral proceedings

and by such grant, the lot ceased to be part of public domain as it had become private property, hence, not subject to free patent

application. It thus concluded that the free patent and the title issued to Calimpong were null and void. The decretal portion of the trial courts

decision reads:

WHEREFORE, premises considered, the Court declares the herein plaintiffs being the hereditary successors of the
adjudicatees mentioned in the Decree (Exhibit L), are the rightful owners ofLot No. 3013, Cad. Survey of Dipolog under
Cad. Case No. 5, L.R.C. Cad. Record No. 757, situated at Anastacio, Polanco, Zamboanga del Norte and, as prayed for in
the complaint, in order to remove clouds cast on it by the claim of the defendants Free Patent No. 09721093961 issued by
the PENRO of Zamboanga del Norte, as well as the Original Certificate of Title No. P-33780 issued by said office and the
Office of the Register of Deeds of Zamboanga del Norte, are hereby declared null and void; the defendants are hereby
ordered to turn over the peaceful possession of the land in question unto plaintiffs; the plaintiffs, upon proper petition filed
in Court, may ask the Register of Deeds of Zamboanga del Norte to cause the issuance of a Certificate of Title under the
same terms and conditions as stated in the Decree issued to Lot No. 3013, with such decree as basis thereof.

No damages awarded, the same not being proved.[12] (Underscoring supplied)

On appeal, the appellate court, by the challenged Decision[13] of January 26, 2004, affirmed in toto that of the trial court.

Hence, the present petition of the spouses Calimpong (hereafter petitioners) faulting the appellate court in:

1. . . . [not] holding that [they are the] true and real owners of the land in question[.]

2. . . . [not] declaring . . . Original Certificate of Title No. P-33780 .. as valid and legally issued[.]

3. . . . giving weight to the alleged title in the name of respondents predecessors in interest which was not found or
existing in the records of the Register of Deeds neither presented or offered in evidence by them[.]

4. . . . appreciating in respondents favor their inability to show proof that they ever filed a petition for judicial
reconstitution of said title, if at all, it actually existed[.]

5. . . . failing to consider respondents alleged payment of taxes to the land started only in 1993 at the time that this
case had already been instituted in court[.]

6. . . . [not] holding that laches, more than prescription, applies in this case[.]

7. . . . resolving that the existing Original Certificate of Title issued in favor of petitioners coupled with the latters
actual possession, not the ghost, alleged title of the respondents predecessors[-]in[-]interest, should entitle the
indefeasibility of the torrens system[.][14]

The petition fails.

It is undisputed that the lot was judicially adjudicated and an order for the registration of the lot in the name of the predecessors-in-

interest of the heirs (hereafter respondent) as owners in fee simple was issued on December 10, 1927, and that a decree of registration was

issued on October 19, 1928, to wit:

xxxx
Therefore, it is ordered by the Court that said land be registered in accordance with the provisions of the Land Registration
Act in the name of said Filomena Gumela, Dionisio Gumela, . . . subject, however, to such of the [e]ncumbrances
mentioned in article 39 of said Law as may be subsisting, and to a first lien in favor of the Insular Government to
guarantee the payment of the special taxes assessed pursuant to the provisions of section 18 of Act 2259, as amended.
 Witness the Honorable Mariano Buyson Lampa, Auxiliary Judge of said Court, the 10th day of December, A. D., nineteen
hundred and twenty-seven.

Issued at Manila, P.I, the 19th day of October A. D. 1928, at 10:03 a.m.

Nothing in the records shows that the order of adjudication was appealed, questioned or set aside.

In De la Merced v. Court of Appeals,[16] this Court held:

. . . [T]he title of ownership on the land is vested upon the owner upon the expiration of the period to
appeal from the decision or adjudication by the cadastral court, without such appeal having been
perfected. The certificate of title would then be necessary for purposes of effecting registration of subsequent disposition
of the land where court proceedings would no longer be necessary.

As we have here a decree issued by the cadastral court, ordering the issuance to Inocencio de los Santos of
the certificate of title over Lot No. 395 after the decision adjudicating ownership to him of the said
property had already become final, and there being no imputation of irregularity in the said cadastral
proceedings, title of ownership on the said adjudicatee was vested as of the date of the issuance of such
judicial decree. The land, for all intents and purposes, had become from that time, registered property which
could not be acquired by adverse possession.[17] (Emphasis and underscoring supplied)

Following the immediately-quoted pronouncement in De la Merced, the title of ownership on the adjudicatees, the Gumelas-

predecessors-in-interest of respondent, was vested on December 10, 1927.

Whether a certificate of title was issued in the name of respondents predecessors-in-interest is immaterial. For, following De la

Merced, the title of ownership on respondents predecessors-in-interest was vested as of 1927. The lot, for all intents and purposes, had

become from said date registered property which could not be acquired by adverse possession and was, therefore, beyond the jurisdiction of

the Land Management Bureau of the DENR (formerly the Bureau of Lands) to subject it to free patent.

Under the provision of Act No. 2874 pursuant to which the title of private respondents predecessor in interest was issued,
the President of the Philippines or his alter ego, the Director of Lands, has no authority to grant a free patent for
land that has ceased to be a public land and has passed to private ownership, and a title so issued is null and
void. The nullity arises not, from the fraud or deceit, but from the fact that the land is not under the
jurisdiction of the Bureau of Lands. The jurisdiction of the Director of Lands is limited only to public lands and does not
cover lands privately owned. The purpose of the legislature in adopting the former Public Land Act, Act No. 2874, was and
is to limit its application to lands of the public domain, and lands held in private ownership are not included therein and
are not affected in any manner whatsoever thereby. Land held in freehold or fee title, or of private ownership, constitute
no part of the public domain and cannot possibly come within the purview of said Act No. 2874, inasmuch as the subject of
such freehold or private land is not embraced in any manner in the title of the Act and the same are excluded from the
provisions of the text thereof. (Emphasis and underscoring supplied) [18]

Since the DENR had no authority to grant a free patent over the lot, Free Patent No. 09721093961 issued on August 17, 1993 by the PENRO

of Zamboanga del Norte and Original Certificate of Title No. P-33780 issued on August 19, 1993 by the Register of Deeds of Zamboanga del

Norte in favor of petitioner Calimpong are null and void. WHEREFORE, the petition is DENIED. Costs against petitioners. SO ORDERED.
G.R. No. L-17757 May 30, 1962

MAMERTA DE LA MERCED, petitioner,

vs.
COURT OF APPEALS, EZEQUIEL M. SANTOS, and AMPARO MACAPAGAL, respondents.

Meliton Pajarillaga for petitioner.

Esteban C. Manuel for respondents.

BARRERA, J.:

This is an appeal from the decision of the Court of Appeals, affirming the original decision of the Court of First Instance of Nueva Ecija (in Civil
Case No. 946), upholding the right of ownership of Ezequiel Santos over Lot No. 395 of the Rizal (Nueva Ecija) Cadastre.

As may be gathered from the extant records, the facts of the case are:

In a complaint filed in the Court of First Instance of Nueva Ecija dated May 3, 1952, which was later amended, Ezequiel Santos (and his wife)
claiming ownership of Lot No. 395 of the Rizal Cadastre by virtue of an adjudication of the cadastral court dated December 26, 1923, in favor
of his father, sought recovery of ownership and possession thereof from the named defendant, and of the landlord's share in the harvests for
the agricultural years 1950-1956.

Defendants, in their answer, resisted plaintiffs' claim and asserted their ownership over said property as evidenced by Original Certificate of
Title No. 3462 issued to their predecessor Juan de la Merced on October 10, 1931 and their continuous possession of the land for more than
30 years.

In the course of the proceedings, Mamerta de la Merced, a legitimate daughter of Juan de la Merced, was allowed to intervene and make
common cause with the defendants.

On January 16, 1957, the court rendered a decision for the plaintiffs after making a finding that Lot No. 395 was part of the Original
Certificate of Title No. 425 issued on May 30, 1916 in the name of the spouses Inocencio de los Santos and Victorina Macapagal, parents of
plaintiff Ezequiel Santos; that in a decision rendered by the cadastral court on December 26, 1923 (Cad. Case No. 14, G.L.R.O. Rec. No. 281),
the said lot was also adjudicated in favor of the conjugal partnership of Inocencio de los Santos and Victorina Macapagal; that pursuant to
said decision, the cadastral court issued on December 17, 1925 an order for the issuance of a certificate of title for the said property; that on
December 8, 1926, Transfer Certificate of Title No. 1971 was issued in the name of Ezequiel Santos in lieu of Original Certificate of Title No.
425 which was cancelled; that on December 28, 1926, the cadastral court declared lot 395 public land, as a consequence of which Juan de la
Merced, after filing a homestead application therefor, was able to obtain Original Certificate of Title No. 3462 on October 10, 1931. Holding
that the cadastral court had no jurisdiction to issue the order declaring the lot public land, and, therefore, the same as well as the certificate
of title issued thereafter was null and void, the court ordered the cancellation of OCT No. 3462 in the name of Juan de la Merced; directed
defendants to vacate Lot No. 395 of the Rizal Cadastre and surrender possession thereof to plaintiffs; and to pay the latter as the landlord's
share, 50 cavans of palay yearly for the agricultural years 1950 to 1956 or their equivalent, and costs of the suit; and the receiver to deliver
to plaintiffs the palay in his custody representing the harvest for the agricultural years 1953-1955.

Upon defendants' motion for reconsideration, however, the promulgation of the decision was ordered suspended and the case was re-set for
hearing for reception of additional evidence.

On August 6, 1957, the court amended its original decision, thus:

The plaintiffs now admit that the litigated "Lot No. 395 of the Rizal Cadastre, Nueva Ecija, is outside the parcel of land described in
Transfer Certificate of Title No. 1971 and original Certificate of Title No. 425, both of which cover Lot 3-6". They, however, claim
ownership over said Lot 395 by virtue of the decision rendered on December 26, 1923 in Cadastral Case No. 14, G.L.R.O. Rec. No.
21, entitled "Government of the Philippines versus Justo Abacan, et al.," (Exh. A-1), and the other dated December 17, 1925
directing the issuance of a decree pursuant to said decision (Exh. V-2, p. 10, Rec. of exhibits).

No decree has yet been issued pursuant to the said order, Exhibit B-2, much less was there a title issued in the name of the
plaintiffs over the said lot.

The defendants, on the other hand, predicate their claim of ownership over the said lot on Original Certificate of Title No. 3462
issued on October 10, 1931 in favor of Juan de la Merced, their predecessor-in-interest, pursuant to a homestead patent issued on
September 15, 1931 (Exh. 1, for the defendants and intervenor), contending that the decision of December 26, 1923, adjudicating
the lot to the plaintiffs, was still subject to review since there was no decree issued pursuant thereto.

The position of the defendants and intervenor would have been correct if there was actually a petition for review of the decision of
December 26, 1923, or a new trial or a reopening of the case concerning Lot No. 395. The fact of the matter is that Original
Certificate of Title No. 3462 was issued pursuant to a homestead patent long after Lot No. 395 was declared a public land in a
decision dated March 29, 1926 at Rizal, Nueva Ecija, and December 28, 1926 at Rizal, Nueva Ecija, and December 28, 1926 at
Manila for Cabanatuan City (Exh. 4) states that Lot No. 395, together with Lots Nos. 394 and 2044, was declared a public land and
was the object of a homestead application by the respective concessionaries (p. 21, rec. of exhibits). . . .

It would seem that the cadastral court in the same cadastral case No. 14, G.L.R.O. Rec. No. 281, entitled Government of the
Philippines vs. Justo Abacan, et al., erroneously re-opened the hearing of Lot 395 which was already adjudicated in favor of the
plaintiff by the decision dated December 26, 1923 (Exhs. A-1, and A-2, pp. 2 and 5, rec. of exhibits) and decreed that Lot 395 is
public land. The same cadastral court should have taken judicial notice of the said decision and the other promulgated therein for
the issuance of a decree in favor of the plaintiffs over lot 395 (Exh. B-2).

While the court held that the land having ceased to be part of the public domain, the Director of Lands no longer had authority to grant the
homestead patent over the same to Juan de la Merced, it declared nevertheless that, inasmuch as no title was actually issued therefor, the
said lot may be acquired by adverse possession. And, as defendants had been in possession of the property for over 20 years, they were
declared to have acquired the right over the same by prescription. The complaint was consequently ordered dismissed; OCT No. 3462
cancelled and a new one issued to defendants in lieu thereof; and plaintiffs were directed to vacate the one-third portion of Lot No. 395
occupied by them, and to pay the costs.

Plaintiffs interposed an appeal to the Court of Appeals. The appellate court, in its decision of July 20, 1960, sustained the contention of
appellants on the basis of the doctrine laid down by this Court in the case of Government of the Philippine Islands v. Abural (39 Phil. 997),
that upon the finality of the decree by the cadastral court, adjudicating ownership of the land, the title thereto becomes incontrovertible and
may no longer be acquired by prescription. And, as the land was no longer part of the public domain when the homestead patent was
obtained by Juan de la Merced, the same can not prevail over the cadastral court's decree of registration of Lot No. 395 in favor of appellant
Santos' predecessor.
Hence, the filing of the instant petition for review of the aforesaid decision of the Court of Appeals.1äwphï1.ñët

The questions actually raised by the present appeal are: What is the effect of the order of the cadastral court of December 26, 1923
adjudicating the lot in favor of Santos, and the subsequent order dated December 17, 1925, directing the issuance of a certificate of title to
Inocencio Santos? Did those orders constitute registration under the law even though the corresponding certificate of title has not been
issued? In the affirmative, could the property thereby affected still be lost by adverse possession?

For purposes of resolving the above questions, these salient facts must be considered:

By virtue of the final decision rendered in Cadastral Case No. 14, G.L.R.O. Rec. No. 21, dated December 26, 1923, Santos' title to Lot No. 395
was definitely confirmed as against the whole world, including the Government;

That the same cadastral court issued a decree dated December 19, 1925 declaring its decision of December 26, 1923 final and directing the
Chief of the General Land Registration Office to issue the certificate of title to Inocencio de los Santos, although no such certificate was
actually issued;

That under date of December 28, 1926, the cadastral court, without reopening the case, declared the same Lot 395 public land as a result of
which Juan de la Merced, after due application, was able to obtain therefor a homestead patent and OCT No. 3462 on October 10, 1931;

That as found by the Court of Appeals, Juan de la Merced, until his death in 1931, was the overseer of Inocencio de los Santos for a big
portion of land which included Lot 395 in question and was, therefore, a trustee for said lot at the time he applied for it as a homestead;

That the complaint for recovery of ownership and possession was filed in 1952.

There is no doubt that had the land involved herein been public, by specific provision of Act 496, the act of registration shall be the operative
act to convey and affect the same, and such registration shall be made in the office of the register of deeds for the province where the land
lies. (Sec. 122, Act 496). In other words, in cases of public lands, the property is not considered registered until the final act or the entry in
the registration book of the registry of deeds had been accomplished.

With respect to private lands, however, the pertinent provisions of Act 496 are:

SEC. 38. If the court after hearing finds that the applicant or adverse claimant has title as stated in his application or adverse claim
and proper for registration, a decree of confirmation and registration shall be entered. Every decree of registration shall bind the
land, and quiet title thereto, subject only to the exception stated in the following section. It shall be conclusive upon and against all
persons including the Insular Government and all the branches thereof, whether mentioned by name in the application, notice or
citation, or included in the general description "To all whom it may concern". Such decree shall not be opened by reason of the
absence, infancy, or other disability of any person affected thereby, nor by any proceeding in any court for reversing judgment or
decrees; subject, however, to the right of any person deprived of land or of any estate or interest therein by decree of registration
obtained by fraud to file in the competent Court of First Instance a petition for review within one year after entry of the decree
povided no innocent purchaser for value has acquired an interest. Upon the expiration of said term of one year, every decree or
certificate of title issued in accordance with this section shall be incontrovertible. . . . (Emphasis supplied.)

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 Chief
of the General Land Registration Office (now Land Registration Commissioner). . . . The decree shall be stated in a convenient form
for transcription upon the certificates of titles hereinafter mentioned. (Emphasis supplied.)

It is apparent from the foregoing provisions that a decree of registration and a certificate of title, under Act 496, are two different things. And
it is the decree of registration, to be issued by the Land Registration Commissioner, which shall be the basis of the certificate of title to be
issued subsequently by the corresponding register of deeds, that quiets title to and binds the land.

But, it must be remembered that the abovementioned provisions apply only to voluntary registration under the Land Registration Act. With
respect to lands titled through compulsory proceedings, the Cadastral Act prescribes:

SEC. 11. The trial of the case may occur at any convenient place within the province in which the lands are situated or at such other
place as the court, for reasons stated in writing and filed with the record of the case, may designate, and shall be conducted in the
same manner as ordinary trials and proceedings in the Court of First Instance and shall be governed by the same rules. Orders of
default and confession shall also be entered in the same manner as in ordinary cases in the same court and shall have the same
effect. All conflicting interests shall be adjudicated by the court and decrees awarded in favor of the persons entitled to the lands or
the various parts thereof, and such decrees, when final, shall be the basis for original certificates of title in favor of said persons
which shall have the same effect as certificates of title granted on application for registration of land under the Land Registration
Act, . . . .
(Emphasis supplied.)

Confronted with the question of when title to the land in a cadastral proceeding is vested, this Court, in the case ofGovernment of the
Philippine Islands v. Abural,1 said:

After trial in a cadastral case, three actions are taken. The first adjudicates ownership in favor of one of the claimants. This
constitutes the decision — the judgment — the decree of the court, and speaks in a judicial manner. The second action is the
declaration by the court that the decree is final and its order for the issuance of the certificates of title by the Chief of the Land
Registration Office. Such order is made if within thirty days from the date of receipt of a copy of the decision no appeal is taken from
the decision. This again is judicial action, although to a less degree than the first.

The third and last action devolves upon the General Land Registration Office. This office has been instituted "for the due effectuation
and accomplishment of the laws relative to the registration of land." (Administrative Code of 1917, sec. 174.) . . . .

The judgment in a cadastral survey, including the rendition of the decree, is a judicial act. As the law says, the judicial decree when
final is the base of the certificate of title. The issuance of the decree by the Land Registration Office is a ministerial act. The date of
the title prepared by the Chief Surveyor is unimportant, for the adjudication has taken place and all that is left to be performed is
the mere formulation of technical description. . . .

As a general rule, registration of title under the cadastral system is final, conclusive, and indisputable, after the passage of the
thirty-day period allowed for an appeal from the date of receipt by the party of a copy of the judgment of the court adjudicating
ownership without any step having been taken to perfect an appeal. The prevailing party may then have execution of the judgment
as of right and is entitled to the certificate of title issued by the Chief of the Land Registration Office. The exception is the special
provision providing for fraud.
Under the foregoing pronouncement, the title of ownership on the land is vested upon the owner upon the expiration of the period to appeal
from the decision or adjudication by the cadastral court, without such an appeal having been perfected. The certificate of title would then be
necessary for purposes of effecting registration of subsequent disposition of the land where court proceedings would no longer be necessary.

As we have here a decree issued by the cadastral court, ordering the issuance to Inocencio de los Santos of the certificate of title over Lot No.
395 after the decision adjudicating ownership to him of the said property had already become final, and there being no imputation of
irregularity in the said cadastral proceedings, title of ownership on the said adjudicatee was vested as of the date of the issuance of such
judicial decree. The land, for all intents and purposes, had become, from that time, registered property which could not be acquired by
adverse possession.

WHEREFORE, the decision of the Court of Appeals is hereby affirmed, with costs against petitioner Mamerta de la Merced. So ordered.
REPUBLIC OF THE PHILIPPINES, G.R. No. 133168

Petitioner,

- versus - Promulgated:

March 28, 2006

BENJAMIN GUERRERO,

Respondent.

x-------------------------------------------------------------------------------x

DECISION

GARCIA, J.:

Assailed and sought to be set aside in this petition for review under Rule 45 of the Rules of Court is the decision[2] dated February 12, 1998 of
the Court of Appeals (CA) in CA-G.R. CV No. 50298 affirming an earlier decision of the Regional Trial Court (RTC) of Quezon City in Civil Case
No. 89-3899, entitled Petition for Amendment of Plan and Technical Description of Original Certificate of Title No. 0-28 in the name of
Benjamin Guerrero, Registry of Deeds of Quezon City.

The assailed decision of the CA recites the facts as follows:

Sometime in December 1964, respondent Benjamin Guerrero filed with the Bureau of Lands (now Lands Management
Bureau) a Miscellaneous Sales Application No. V-83191 covering a parcel of land situated at Pugad Lawin, Quezon City,
consisting of 256 square meters. Upon favorable report and recommendation of the District Land Officer, Guerreros
application was approved per Order of Award (Exhibit B), with the boundaries of the land awarded specified as follows: N-
Lot No. 10-C, Psd-37801; S-Culiat Creek; E-Road; and W-Public Land. A sketch of the land awarded is contained at the
back of the Order of Award.

Subsequently, Miscellaneous Sales Patent No. 8991 dated August 16, 1982 was issued in favor of respondent. Pursuant
thereto the corresponding Original Certificate of Title No. 0-28 was issued on August 27, 1982.

On July 29, 1983, one Angelina Bustamante filed a protest with the Bureau of Lands claiming that respondent obtained the
sales patent through fraud, false statement of facts and/or omission of material facts considering that 174 square meters
awarded to respondent covered the land where her house is situated and where she has been residing since 1961.

A formal investigation was conducted by the Bureau of Lands, after which the Director of Lands issued an order dismissing
the protest of Angelina Z. Bustamante. The dismissal of the protest was affirmed by the then Minister of Natural Resources
and by the Office of the President in a Decision dated July 22, 1985.

Bustamante filed a motion for reconsideration of the Decision dated July 22, 1985. Acting on the motion for
reconsideration, the President, , ordered that the case be remanded to the DENR [Department of Environment and Natural
Resources] for the latters office to conduct an ocular investigation and resurvey of the disputed area. The said directive is
contained in the Order datedOctober 30, 1987(Exhibit J).

Pursuant to the order of the Office of the President, an ocular investigation and relocation survey was conducted by the
DENR. A report (Exhibit K) was thereafter submitted with a finding that 83 square meters of the titled property of Guerrero
consisting of 174 square meters is under ACTUAL PHYSICAL POSSESSION of Marcelo Bustamante (husband of Angelina
Bustamante) with only 91 square meters under the physical possession of Guerrero. It was also found out that OCT No. 0-
28 is supposed to be traversed by a road 3 meters wide, as even the Order of Award in favor of Guerrero, shows by the
boundaries of the land indicated therein, viz: bounded on the N-Lot No. 10-C, Psd-37801, S-Culiat Creek, E-Road and W-
Public Land.

On January 10, 1989, the Office of the President, upon receipt of the [DENR] Ocular Investigation and Relocation Survey
Report (Exhibit K) , issued an order directing the DENR to implement the Report for the proper correction of the technical
description of the land covered by OCT No. 0-28 issued to respondent.

Pursuant to the directive of the Office of the President, the Director of Lands [on behalf of the Republic of the Philippines]
instituted the instant action [Petition for Amendment of Plan and Technical Description of OCT No. 0-28 in the name of
Benjamin Guerrero] on November 7, 1989.
 On April 6, 1990, the [respondent] Benjamin Guerrero filed a motion to dismiss the petition , alleging among other things,
that the RTC of Quezon City was without jurisdiction over the Director of Lands petition and that the said petition was
defective in form and substance, inasmuch as it failed to name [Guerrero] who holds a certificate of title (OCT No. 0-28)
over the properties subject of the petition, as respondent in the action, and that the title sought to be amended was
irrevocable and can no longer be questioned.

In its order dated July 8, 1992, the lower court denied the said motion to dismiss for lack of merit. Trial of the petition
followed with the Director of Lands, on one hand, and [Guerrero], on the other, presenting their respective evidence and
witnesses.[3] [Words in bracket added.]

On July 13, 1995, the RTC, on the postulate that petitioner Republic failed to prove its allegation that respondent obtained the sales patent
and the certificate of title through fraud and misrepresentation, rendered judgment finding for the latter. The trial court likewise ruled that the
original certificate of title (OCT No. 0-28) in the name of respondent acquired the characteristics of indefeasibility after the expiration of one
(1) year from the entry of the decree of registration.

Consequently, petitioner interposed an appeal to the CA, which, in a decision dated February 12, 1998, affirmed that of the trial court,
rationalizing as follows:

It is a settled rule that a certificate of title issued pursuant to any grant or patent involving public lands is as conclusive
and indefeasible as any other certificate of title issued upon private lands in ordinary or cadastral registration proceedings.
The effect of registration of a homestead or any other similar patent and the issuance of a certificate of title to the
patentee is to vest in him an incontestable title to the land, in the same manner as if ownership had been determined by
final decree of the court, and the title so issued is absolutely conclusive and indisputable.

In the same way, therefore, that a decree of registration may be reviewed or reopened within one year after the entry thereof, upon
a charge of actual fraud, a patent awarded in accordance with the Public Land Law may be reviewed within one year from
the date of the order for the issuance of the patent also on the ground of actual fraud.

xxx there is no showing that at the time the [respondent] applied for his miscellaneous sales patent, there were third persons who
had been in occupation of the land applied for. While subsequent survey documents, prepared as a consequence of the
protest filed by the Bustamentes, report the possession of the Bustamantes of a portion of the land, and the erection of
their house thereon, these reports do not indicate if such structures were existing at the time the application of the
[respondent] was filed in 1964.

There is no support, therefore, to the submission that the [respondent] was guilty of actual fraud in the acquisition of his
miscellaneous sales patent, and subsequently, OCT No. 0-28.[4] (Words in bracket added)

Petitioner then moved for a reconsideration of the above decision but the same was denied by the appellate court in its resolution of March
23, 1998.[5]

Hence, this recourse, petitioner Republic contending that the appellate court erred in holding -

I. That a certificate of title issued pursuant to any grant or patent involving public lands is conclusive and
indefeasible despite the fact that respondents title was procured through fraud and misrepresentation.

II. That there is no basis for the submission that respondent was guilty of actual fraud in the acquisition of his
miscellaneous sales patent despite the final ruling of the Office of the President from which ruling respondent did
not appeal.

III. That the Director of Lands cannot raise the issue of possession of a third person of the land, or a portion
thereof, after the award and issuance of the patent to the applicant despite the obvious fact that the protest was
filed within one year from the issuance of patent.[6]

Petitioner argues in esse that respondent procured his sales patent and certificate of title through fraud and misrepresentation. To

support its basic posture, petitioner points to the verification survey conducted by Engr. Ernesto Erive of the DENR, which, to petitioner,

argues for the proposition that respondents entitlement to a public land award should have been limited to a 91-square meter area instead

of the 174 square meters eventually granted.

 On the other hand, respondent contends that his OCT No. 0-28 which he secured pursuant to a sales patent is conclusive and

indefeasible under theTorrens system of registration. As such, his title can no longer be altered, impugned or cancelled.

At the outset, it must be pointed out that the essential issue raised in this Petition ― the presence of fraud ― is factual. As a general

rule, this Court does not review factual matters, as only questions of law may be raised in a petition for review on certiorari filed with this

Court. And as the Court has consistently held, factual findings of trial courts, when adopted and confirmed by the CA, are final and

conclusive on this Court,[7] save when the judgment of the appellate court is based on a misapprehension of facts or factual inferences

manifestly incorrect or when that court overlooked certain relevant facts which, if properly considered, would justify a different

conclusion.[8] Obviously, petitioner is invoking these exceptions toward having the Court review the factual determinations of the CA.

The basic issue in this case turns on whether or not petitioner has proven by clear and convincing evidence that respondent

procured Miscellaneous Sales Patent (MSP) No. 8991 and OCT No. 0-28 through fraud and misrepresentation.

It bears to stress that the property in question, while once part of the lands of the public domain and disposed of via a
miscellaneous sales arrangement, is now covered by a Torrens certificate. Grants of public land were brought under the operation of
the Torrens system by Act No. 496, or the Land Registration Act of 1903. Under the Torrens system of registration, the government is
required to issue an official certificate of title to attest to the fact that the person named is the owner of the property described therein,
subject to such liens and encumbrances as thereon noted or what the law warrants or reserves. [9] As it were, the Torrens system aims to
obviate possible conflicts of title by giving the public the right to rely upon the face of the Torrens certificate and to dispense, as a rule, with
the necessity of inquiring further; on the part of the registered owner, the system gives him complete peace of mind that he would be
secured in his ownership as long as he has not voluntarily disposed of any right over the covered land.[10]

Section 122 of Act No. 496 provides:

SEC. 122. Whenever public lands belonging to the Government of the [Republic of the Philippines] are alienated,
granted, or conveyed to persons or to public or private corporations, the same shall be brought forthwith under the operation
of this Act and shall become registered lands. It shall be the duty of the official issuing the instrument of alienation, grant, or
conveyance in behalf of the Government to cause such instrument before its delivery to the grantee, to be filed with the
register of deeds for the province where the land lies and to be there registered like other deeds and conveyances, whereupon
a certificate shall be entered as in other cases of registered land, and an owners duplicate certificate issued to the grantee.
The deed, grant, or instrument of conveyance from the Government shall not take effect as a conveyance or bind the land, but
shall operate only as a contract between the Government and the grantee and as evidence of authority to the clerk or register
of deeds to make registration. The act of registration shall be the operative act to convey and affect the land, and in all cases
under this Act registration shall be made in the office of the register of deeds for the province where the land lies. xxx. (Words
in bracket added)

Upon its registration, the land falls under the operation of Act No. 496 and becomes registered land. Time and again, we have said

that a Torrenscertificate is evidence of an indefeasible title to property in favor of the person whose name appears thereon. [11]

However, Section 38 of Act No. 496 recognizes the right of a person deprived of land to institute an action to reopen or revise a

decree of registration obtained by actual fraud. Section 38 of Act No. 496 says so:

SEC. 38. ― xxx. Every decree of registration shall bind the land, and quiet title thereto, subject only to the
exceptions stated in the following section. It shall be conclusive upon and against all persons, including the [Republic of
the Philippines] and all the branches thereof, . Such decree shall not be opened by reason of the absence, minority,
or other disability of any person affected thereby, nor by any proceeding in any court for reversing judgments
or decrees, subject, however, to the right of any person deprived of the land or of any estate or interest
therein by decree of registration obtained by actual fraud, to file in the proper Court of First Instance [now
Regional Trial Court] a petition for review of the decree of registration within one year after entry of the
decree provided no innocent purchaser for value has acquired an interest. Upon the expiration of said term of
one year, every decree or certificate of title issued in accordance with this section shall be incontrovertible.
xxx. (Emphasis and words in bracket supplied)

Fraud is of two kinds: actual or constructive. Actual or positive fraud proceeds from an intentional deception practiced by means
of the misrepresentation or concealment of a material fact. Constructive fraud is construed as a fraud because of its detrimental effect upon
public interests and public or private confidence, even though the act is not done with an actual design to commit positive fraud or injury
upon other persons.[12]

Fraud may also be either extrinsic or intrinsic. Fraud is regarded as intrinsic where the fraudulent acts pertain to an issue involved
in the original action, or where the acts constituting the fraud were or could have been litigated therein. The fraud is extrinsic if it is employed
to deprive parties of their day in court and thus prevent them from asserting their right to the property registered in the name of the
applicant.[13]

The distinctions assume significance because only actual and extrinsic fraud had been accepted and is contemplated by the law as a ground to

review or reopen a decree of registration. Thus, relief is granted to a party deprived of his interest in land where the fraud consists in a

deliberate misrepresentation that the lots are not contested when in fact they are; or in willfully misrepresenting that there are no other

claims; or in deliberately failing to notify the party entitled to notice; or in inducing him not to oppose an application; or in misrepresenting

about the identity of the lot to the true owner by the applicant causing the former to withdraw his application. In all these examples, the

overriding consideration is that the fraudulent scheme of the prevailing litigant prevented a party from having his day in court or from

presenting his case. The fraud, therefore, is one that affects and goes into the jurisdiction of the court.[14]

We have repeatedly held that relief on the ground of fraud will not be granted where the alleged fraud goes into the merits of the

case, is intrinsic and not collateral, and has been controverted and decided. Thus, we have underscored the denial of relief where it appears

that the fraud consisted in the presentation at the trial of a supposed forged document, or a false and perjured testimony, or in basing the

judgment on a fraudulent compromise agreement, or in the alleged fraudulent acts or omissions of the counsel which prevented the

petitioner from properly presenting the case.[15]

Petitioner fails to convince the Court that the facts relied upon by it to justify a review of the decree constitute actual and extrinsic

fraud. It has not adduced adequate evidence that would show that respondent employed actual and extrinsic fraud in procuring the patent

and the corresponding certificate of title. Petitioner miserably failed to prove that it was prevented from asserting its right over the lot in

question and from properly presenting its case by reason of such fraud. In fact, other than its peremptory statement in its petition filed

before the trial court that the patentee, Benjamin Guerrero, obtained the above indicated sales patent through fraud, false statement of

facts and/or omission of material facts,[16] petitioner did not specifically allege how fraud was perpetrated by respondent in procuring the

sales patent and the certificate of title. Nor was any evidence proffered to substantiate the allegation. Fraud cannot be presumed, and the

failure of petitioner to prove it defeats it own cause.

Well-settled is the rule that the party alleging fraud or mistake in a transaction bears the burden of proof.[17] The circumstances

evidencing fraud are as varied as the people who perpetrate it in each case. It may assume different shapes and forms; it may be committed

in as many different ways.[18] Thus, the law requires that fraud be established, not just by preponderance of evidence, but by clear and

convincing evidence.[19]

Petitioner relies heavily on the verification survey report[20] which stated that respondent Guerrero was entitled to only

91 square meters of the subject lot instead of 174 square meters which was awarded to him. There is, however, no proof that the area

eventually awarded to respondent was intentionally and fraudulently increased. It was never proven that respondent was a party to any

fraud that led to the award of a bigger area of 174 square meters instead of 91 square meters. Petitioner even failed to give sufficient proof

of any error which may have been committed by its agents who had surveyed the subject property nor had petitioner offered a sensible

explanation as to the reason for such discrepancy. Thus, the presumption of regularity in the performance of official functions must be

respected.

This Court agrees with the RTC that the issuance of the sales patent over the subject lot was made in accordance with the procedure

laid down byCommonwealth Act No. 141, as amended, otherwise known as the Public Land Act.[21] Under Section 91 thereof, an

investigation should be conducted for the purpose of ascertaining the veracity of the material facts set out in the application.[22] The law also
 requires sufficient notice to the municipality and barrio where the land is located in order to give adverse claimants the opportunity to

present their claims.[23]

In the instant case, records reveal that on December 22, 1964, a day after respondent filed his miscellaneous sales application, an

actual investigation and site verification of the parcel of land was conducted by Land Investigator Alfonso Tumbocon who reported that the

land was free from claims and conflicts.[24]Likewise, the notice of sale of the lot in question was posted at the District Land Office in San

Miguel, Manila, at the Quezon City Hall, and at Pugad Lawin, Quezon City for 30 consecutive days from February 17, 1965 to March 17, 1965

which was the date scheduled for the sale of the lot. The said notice was worded as follows:

If there is any adverse claim to the land, such claim must be filed at the Bureau of Lands, Manila on or before the
date of the sale; otherwise such claim shall forever be barred.[25]

Further, the Order of Award [26] dated May 20, 1971, as well as the Issuance of Patent[27] dated June 28, 1982 were both duly signed

by the Director of Lands. The Order of Award even declared that Guerrero has in good faith established his residence on the land in question.

On the other hand, the Issuance of Patent stated that the land consisting of 174 square meters is free from any adverse claim and that

Guerrero has fully paid the purchase price of the lot. Having complied with all the requirements of the law preliminary to the issuance of the

patent, respondent was thus issued MSP No. 8991 dated August 16, 1982. Thereafter, the corresponding OCT No. 0-28 was issued

on August 27, 1982 in the name of respondent Guerrero.

At any rate, by legal presumption, public officers are deemed to have regularly performed their official duties. Thus, the proceedings

for land registration that led to the issuance of MSP No. 8991 and OCT No. 0-28 in respondents name are presumptively regular and

proper. To overturn this legal presumption will not only endanger judicial stability, but also violate the underlying principle of

the Torrens system. Indeed, to do so would reduce the vaunted legal indefeasibility of Torrens titles to meaningless verbiage.[28] Besides,

this presumption of regularity has not been overcome by the evidence presented by petitioner. We, therefore, cannot sustain petitioners

contention that fraud tainted the sales patent granted to respondent Guerrero, as well as the certificate of title issued in consequence

thereof.

Granting that Guerrero committed extrinsic and actual fraud, petitioner failed to avail itself of the remedy within the prescribed

period. Under Section 38 of Act No. 496, a petition for reopening and review of the decree of registration must be filed within one year from

the date of entry of said decree.

In the case of public land grants or patents, the one-year period commences from the issuance of the patent by the government.[29]

In the instant case, the sales patent was issued to respondent on August 16, 1982, while petitioner
instituted an action to amend respondents certificate of title on November 7, 1989 or after the lapse of more than seven (7) years from the
issuance of the patent. Clearly, petitioner failed to timely avail of the remedy to contest Guerreros title.

Petitioner argues that the right of the State for the reversion of unlawfully acquired property is not barred by prescription. Thus, it
can still recover the land granted to respondent.

True, prescription, basically, does not run against the State and the latter may still bring an action, even after the lapse of one year,

for the reversion to the public domain of lands which have been fraudulently granted to private individuals.[30] However, this remedy of

reversion can only be availed of in cases of fraudulent or unlawful inclusion of the land in patents or certificates of title. In the present case,

petitioner cannot successfully invoke this defense for, as discussed earlier, it was never proven that respondents patent and title were

obtained through actual fraud or other illegal means.

Lest it be overlooked, a piece of land covered by a registered patent and the corresponding certificate of title ceases to be part of

the public domain. As such, it is considered a private property over which the Director of Lands has neither control nor jurisdiction.[31]
 Petitioner likewise insists that respondents title had yet to attain the status of indefeasibility. As argued, Angelina Bustamante was
able to timely file a protest on July 29, 1983, which was well within the one-year prescriptive period.

We do not agree.

While Angelina Bustamante indeed protested the award of a sales patent in favor of respondent, the protest was, however, filed with

the Bureau of Lands instead of with the regional trial court as mandated by the aforequoted provision of Section 38 of Act No. 496. Said

provision expressly states that a petition forreview of a decree of registration shall be filed in the proper Court of First Instance (now Regional

Trial Court). The law did not say that such petition may be filed with an administrative agency like the Bureau of Lands. To be sure, what the

law contemplates in allowing a review of the decree of registration is a full-blown trial before a regular court where each party could be

afforded full opportunity to present his/its case and where each of them must establish his case by preponderance of evidence and not by

mere substantial evidence, the usual quantum of proof required in administrative proceedings. The concept of preponderance of evidence

refers to evidence which is of greater weight, or more convincing, than that which is offered in opposition to it; at bottom, it means

probability of truth.[32] On the other hand, substantial evidence refers to such relevant evidence as a reasonable mind might accept as

adequate to support a conclusion, even if other minds equally reasonable might conceivably opine otherwise. [33]

As the review of a decree of registration constitutes an attack on the very integrity of land titles and the Torrens system, a full-
blown trial on the merits before a regular court is necessary for the purpose of achieving a more in-depth and thorough determination of all
issues involved.

Hence, contrary to petitioners assertion, the protest filed by Bustamante with the Bureau of Lands cannot be considered in the
context of a petition to review the decree of registration issued to respondent. It was only on November 7, 1989 that such petition was filed
by the Director of Lands with the RTC and obviously, it was way beyond the one-year period prescribed by law.

It is worth stressing that the Torrens system was adopted in this country because it was believed to be the most effective measure
to guarantee the integrity of land titles and to protect their indefeasibility once the claim of ownership is established and recognized. If a
person purchases a piece of land on the assurance that the sellers title thereto is valid, he should not run the risk of being told later that his
acquisition was ineffectual after all. This would not only beunfair to him. What is worse is that if this were permitted, public confidence in the
system would be eroded and land transactions would have to be attended by complicated and not necessarily conclusive investigations and
proof of ownership. The further consequence would be that land conflicts could be even more abrasive, if not even violent. The government,
recognizing the worthy purposes of the Torrens system, should be the first to accept the validity of titles issued thereunder once the
conditions laid down by the law are satisfied.[34]

Instead of stabilizing the Torrens system, petitioner, in filing a suit for the amendment of OCT No. 0-28, derogates the very integrity

of the system as itgives the impression to Torrens title holders, like herein respondent, that their titles can be questioned by the same

authority who had approved their titles. In that case, no Torrens title holder shall be at peace with the ownership and possession of his land,

for land registration officers can question his title any time they make a finding unfavorable to said title holder. This is all the more

frustrating for respondent Guerrero considering that he had bought the subject lot from the government itself, the very same party who is

now impugning his title.

While the Torrens system is not a mode of acquiring titles to lands but merely a system of registration of titles to
lands,[35] justice and equity demand thatthe titleholder should not be made to bear the unfavorable effect of the mistake or negligence of the
States agents, in the absence of proof of his complicity in afraud or of manifest damage to third persons. The real purpose of the Torrens
system is to quiet title to land and put a stop forever to any question as to the legality of the
title, except claims that were noted in the certificate at the time of the registration or that may arise subsequent thereto.[36] Otherwise, the
integrity of the Torrens system shall forever be sullied by the ineptitude and inefficiency of land registration officials, who are ordinarily
presumed to have regularly performed their duties.[37] Respondents certificate of title, having been registered under the Torrens system, was
thus vested with the garment of indefeasibility. WHEREFORE, the instant petition is hereby DENIED and the assailed decision is AFFIRMED.
SO ORDERED.
JUANITA NAVAL, G.R. No. 167412

Petitioner,

- versus -

COURT OF APPEALS, JUANITO

CAMALLA, JAIME NACION, Promulgated:

CONRADO BALILA, ESTER MOYA

and PORFIRIA AGUIRRE,

Respondents. February 22, 2006

x ---------------------------------------------------------------------------------------- x

DECISION

YNARES-SANTIAGO, J.:

This petition for review assails the Decision[1] of the Court of Appeals dated December 14, 2004, in CA-G.R. SP No. 86736, which

reversed the Decision[2] of the Regional Trial Court (RTC) of Naga City, Branch 26, in Civil Case No. 2004-0054 affirming the Decision[3] of the

Municipal Circuit Trial Court (MCTC) of Magarao-Canaman,Camarines Sur, as well as the Resolution[4] dated February 17, 2005 denying

petitioners motion for reconsideration.

The facts of the case are as follows:

On December 2, 1969, Ildefonso A. Naval sold a parcel of land located in Sto. Tomas, Magarao, Camarines Sur, consisting of 858 sq.

m. to Gregorio B. Galarosa. The sale was recorded in the Registry of Property of the Registry of Deeds of Camarines Sur on December 3,

1969 pursuant to Act No. 3344, the law governing registrations of all instruments on unregistered lands.[5]

Subsequently, Gregorio sold portions of the land to respondents Conrado Rodrigo Balilla[6] on November 4, 1976,

Jaime Nacion[7] on January 10, 1977 and spousesIreneo and Ester Moya[8] in July 1977, and Juanito Camalla[9] on September 4, 1987. All

buyers occupied the portion they bought, built improvements thereon, and paid the taxes due thereto.[10]

The controversy arose when petitioner Juanita Naval, the great granddaughter of Ildefonso, was issued on April 1, 1975 by the

Register of Deeds of Camarines Sur an Original Certificate of Title (OCT) No. RP-5386 (29791), covering 733 sq. m. of the subject

land.[11] She claimed that she bought the subject land from Ildefonso in 1972.[12]

On November 10, 1977, petitioner filed a complaint for recovery of possession

against Bartolome Aguirre, Conrado Balila,[13] Ireneo Moya, Jaime Nacion and DomingoNacion, which was docketed as Civil Case No.

306.[14] However, the case was dismissed[15] without prejudice[16] for failure to prosecute the action for an unreasonable length of time.

Almost 20 years later, or on April 21, 1997, petitioner re-filed the complaint for recovery of possession with damages before the

MCTC of Magarao-Canaman, CamarinesSur, against Juanita[17] Camalla, Diosdado Balila, Conrado Balila, Forferia[18] Aguirre, Jaime Nacion and

Ester Moya. The case was docketed as Civil Case No. 994.
 After trial, the MCTC rendered its decision, the dispositive portion reads as follows:

WHEREFORE, for all the foregoing consideration, decision is hereby rendered in favor of the plaintiff and against
defendants:

1) Declaring the plaintiff to be the legal owner of the land as described in paragraph 2 of the complaint;

2) Ordering defendants Juanito Camalla, Diosdado Balila, Conrado Balila, Porferia Aguirre and Jaime Nacion to
vacate the property in question and to deliver its possession to the plaintiff;

3) Ordering Ester Moya to vacate the fifty (50) square meters occupied by her and to relinquish its possession to
the plaintiff;

4) Dismissing the respective claims for damages of the parties. Pronouncing no costs. SO ORDERED.[19]

Aggrieved, respondents appealed the decision to the RTC of Naga City, which affirmed in toto the assailed decision.[20]

Respondents thereafter elevated the case to the Court of Appeals via Rule 42 of the Rules of Court. Finding the prior registration of

the deed of sale between Ildefonso and Gregorio with the Register of Deeds as a constructive notice to subsequent buyers, the appellate court

reversed the decision of the RTC. Thus,

WHEREFORE, premises considered, the present petition is hereby GRANTED. The appealed decision of the court a
quo is hereby REVERSED and SET ASIDE and a new judgment is hereby entered dismissing respondent's complaint for
recovery of possession with damages. Petitioners' counterclaim for damages is likewise dismissed for lack of legal and
factual bases. No pronouncement as to costs. SO ORDERED.[21]

Hence, this petition assigning the following errors:

THE COURT OF APPEALS ERRED IN DECLARING THAT GREGORIO GALAROSA HAS RIGHTFULLY ACQUIRED OWNERSHIP
OVER THE LOT COVERED BY OCT RP #5386 (29791) AND DECLARING HIM TO HAVE POSSESSED THE LOT BEFORE THE
ALLEGED SALES TO RESPONDENTS.

II

THE COURT OF APPEALS ERRED IN HOLDING THAT THE PAYMENT OF TAXES BY RESPONDENTS WERE (sic) EVIDENCE OF
LAWFUL POSSESSION AND OWNERSHIP.

III

THE COURT OF APPEALS ERRED IN DECLARING THAT THE LOTS CLAIMED BY THE RESPONDENTS HAVE BEEN POSSESSED
BY THEM IN GOOD FAITH DESPITE THEIR KNOWLEDGE OF THE EXISTENCE OF OCT RP #5386(29791). [22]

Petitioner claims that she has superior rights over the subject land because the sale between Ildefonso and Gregorio and the

subsequent registration thereof with the Register of Deeds had no legal effect since the subject land was declared in the name

of Agrifina Avila while the tax declaration cancelled by Gregorios was that of GregorioBoaga. Petitioner thus assails the right claimed by

Gregorio over the subject land from which the respondents derived their respective claims. [23]

On the other hand, respondents contend that the registered sale by Ildefonso to Gregorio in 1969 of the subject land, from whom

they derive their claims, vests them with better right than the petitioner; that registration under Act No. 3344 served as constructive notice to

the whole world, including the petitioner, who claimed to have purchased the subject land from Ildefonso in 1972, but failed to present

evidence to prove such acquisition.[24]

We deny the petition.

Prefatorily, a perusal of the records reveals that during the trial, petitioner vigorously asserted that the subject land was the

exclusive property of Ildefonso who sold it to her in 1972.[25] However, in this appeal, petitioner assails the ownership not only of Gregorio but

also of Ildefonso by alleging that at the time the latter sold the land to Gregorio, the same was declared in the name of Agrifina Avila. When a

party adopts a certain theory in the court below, he is not allowed to change his theory on appeal, for to allow him to do so would not only be
unfair to the other party, but it would also be offensive to the basic rules of fair play, justice and due process. [26]In this appeal, the issue for

resolution is who has the superior right to a parcel of land sold to different buyers at different times by its former owner.

It is not disputed that the subject land belonged to Ildefonso and that it was not registered under the Torrens System[27] when it

was sold to Gregorio in 1969 and to the petitioner in 1972. Further, the deed of sale between Ildefonso and Gregorio was registered with the

Register of Deeds of Camarines Sur pursuant to Act No. 3344, as shown by Inscription No. 54609 dated December 3, 1969, Page 119,

Volume 186, File No. 55409 at the back thereof.

In holding that respondents have a better right to possess the subject land in view of the bona fide registration of the sale with the

Register of Deeds of Camarines Sur byIldefonso and Gregorio, the Court of Appeals applied Article 1544 of the Civil Code, which provides:

ART. 1544. If the same thing should have been sold to different vendees, the ownership shall be transferred to
the person who may have first taken possession thereof in good faith, if it should be movable property.

Should it be immovable property, the ownership shall belong to the person acquiring it who in good faith first
recorded it in the Registry of Property.

Should there be no inscription, the ownership shall pertain to the person who in good faith was first in the
possession; and, in the absence thereof, to the person who presents the oldest title, provided there is good faith.

While we agree with the appellate court that respondents have superior right over the petitioner on the subject property, we find Article 1544

inapplicable to the case at bar since the subject land was unregistered at the time of the first sale. The registration contemplated under this

provision has been held to refer to registration under the Torrens System, which considers the act of registration as the operative act that

binds the land.[28] Thus, in Carumba v. Court of Appeals,[29] we held that Article 1544 of the Civil Code has no application to land not

registered under Torrens System.

The law applicable therefore is Act No. 3344, which provides for the registration of all instruments on land neither covered by the

Spanish Mortgage Law nor the Torrens System. Under this law, registration by the first buyer is constructive notice to the second buyer that

can defeat his right as such buyer in good faith.

Applying the law, we held in Bautista v. Fule[30] that the registration of an instrument involving unregistered land in the Registry of

Deeds creates constructive notice and binds third person who may subsequently deal with the same property. We also held in Bayoca v.

Nogales[31] that:

Verily, there is absence of prior registration in good faith by petitioners of the second sale in their favor. As
stated in the Santiago case, registration by the first buyer under Act No. 3344 can have the effect of constructive notice to
the second buyer that can defeat his right as such buyer. On account of the undisputed fact of registration under Act No.
3344 by [the first buyers], necessarily, there is absent good faith in the registration of the sale by the [second buyers] for
which they had been issued certificates of title in their names. It follows that their title to the land cannot be upheld. x x x.

Even if petitioner argues that she purchased and registered the subject land in good faith and without knowledge of any adverse

claim thereto, respondents still have superior right over the disputed property. We held in Rayos v. Reyes[32] that:

[T]he issue of good faith or bad faith of the buyer is relevant only where the subject of the sale is registered land and the
purchaser is buying the same from the registered owner whose title to the land is clean x x x in such case the purchaser
who relies on the clean title of the registered owner is protected if he is a purchaser in good faith for value. Since the
properties in question are unregistered lands, petitioners as subsequent buyers thereof did so at their peril. Their claim of
having bought the land in good faith, i.e., without notice that some other person has a right to or interest in the property,
would not protect them if it turns out, as it actually did in this case, that their seller did not own the property at the time of
the sale.

It is an established principle that no one can give what one does not have, nemo dat quod non habet. Accordingly, one can sell only

what one owns or is authorized to sell, and the buyer can acquire no more than what the seller can transfer legally. [33] In the case at bar,

since Ildefonso no longer owned the subject land at the time of the sale to the petitioner, he had nothing to sell and the latter did not acquire

any right to it.

Even if we apply Article 1544, the facts would nonetheless show that respondents and their predecessors-in-interest registered first

the source of their ownership and possession, i.e., the 1969 deed of sale, and possessed the subject land at the earliest time. Applying the
doctrine of priority in time, priority in rights or prius tempore, potior jure,respondents are entitled to the ownership and possession of the

subject land.[34]

True, a certificate of title, once registered, should not thereafter be impugned, altered, changed, modified, enlarged or diminished except in a

direct proceeding permitted by law.[35] Moreover, Section 32 of Presidential Decree No. 1529 provides that [u]pon the expiration of said

period of one year, the decree of registration and the certificate of title shall become incontrovertible.

However, it does not deprive an aggrieved party of a remedy in law. What cannot be collaterally attacked is the certificate of title

and not the title or ownership which is represented by such certificate. Ownership is different from a certificate of title.[36] The fact that

petitioner was able to secure a title in her name did not operate to vest ownership upon her of the subject land. Registration of a piece of land

under the Torrens System does not create or vest title, because it is not a mode of acquiring ownership. A certificate of title is merely an

evidence of ownership or title over the particular property described therein.[37] It cannot be used to protect a usurper from the true owner;

nor can it be used as a shield for the commission of fraud; neither does it permit one to enrich himself at the expense of others.[38] Its

issuance in favor of a particular person does not foreclose the possibility that the real property may be co-owned with persons not named in

the certificate, or that it may be held in trust for another person by the registered owner.[39]

As correctly held by the Court of Appeals, notwithstanding the indefeasibility of the Torrens title, the registered owner may still be

compelled to reconvey the registered property to its true owners. The rationale for the rule is that reconveyance does not set aside or re-

subject to review the findings of fact of the Bureau of Lands. In an action forreconveyance, the decree of registration is respected as

incontrovertible. What is sought instead is the transfer of the property or its title which has been wrongfully or erroneously registered in

another persons name, to its rightful or legal owner, or to the one with a better right.[40]

Finally, the Court of Appeals correctly held that an action for reconveyance does not prescribe when the plaintiff is in possession of

the land to be reconveyed, as in this case. Thus, in Leyson v. Bontuyan:[41]

x x x [T]his Court declared that an action for reconveyance based on fraud is imprescriptible where the plaintiff is in
possession of the property subject of the acts. In Vda. de Cabrera v. Court of Appeals, the Court held:

... [A]n action for reconveyance of a parcel of land based on implied or constructive trust prescribes in
ten years, the point of reference being the date of registration of the deed or the date of the issuance of
the certificate of title over the property, but this rule applies only when the plaintiff or the person
enforcing the trust is not in possession of the property, since if a person claiming to be the owner
thereof is in actual possession of the property, as the defendants are in the instant case, the right to
seek reconveyance, which in effect seeks to quiet title to the property, does not prescribe. The reason
for this is that one who is in actual possession of a piece of land claiming to be the owner thereof may
wait until his possession is disturbed or his title is attacked before taking steps to vindicate his right, the
reason for the rule being, that his undisturbed possession gives him a continuing right to seek the aid of
a court of equity to ascertain and determine the nature of the adverse claim of a third party and its
effect on his own title, which right can be claimed only by one who is in possession.

Similarly, in the case of David v. Malay, the same pronouncement was reiterated by the Court:

... There is settled jurisprudence that one who is in actual possession of a piece of land
claiming to be owner thereof may wait until his possession is disturbed or his title is attacked before
taking steps to vindicate his right, the reason for the rule being, that his undisturbed possession gives
him a continuing right to seek the aid of the court of equity to ascertain and determine the nature of the
adverse claim of a third party and its effect on his own title, which right can be claimed only by one who
is in possession. No better situation can be conceived at the moment for Us to apply this rule on equity
than that of herein petitioners whose ... possession of the litigated property for no less than 30 years
and was suddenly confronted with a claim that the land she had been occupying and cultivating all
these years, was titled in the name of a third person. We hold that in such a situation the right to quiet
title to the property, to seek its reconveyance and annul any certificate of title covering it, accrued only
from the time the one in possession was made aware of a claim adverse to his own, and it is only then
that the statutory period of prescription commences to run against such possessor.

The paramount reason for this exception is based on the theory that registration proceedings could not be used
as a shield for fraud. Moreover, to hold otherwise would be to put premium on land-grabbing and transgressing the
broader principle in human relations that no person shall unjustly enrich himself at the expense of another.

WHEREFORE, in view of the foregoing, the petition is DENIED. The Decision of the Court of Appeals dated December 14, 2004, in CA-G.R.

SP No. 86736, dismissing petitioners complaint for recovery of possession and respondents counterclaim for damages for lack of legal and

factual bases, and the Resolution dated February 17, 2005denying the motion for reconsideration, are AFFIRMED. SO ORDERED.
ENCARNACION L. CUIZON and G.R. No. 143027
SALVADOR CUIZON,
Petitioners,

- versus -

MERCEDES C. REMOTO,
LEONIDA R. MEYNARD,
CELERINA R. ROSALES and Promulgated:
REMEDIOS C. REMOTO,
Respondents. October 11, 2005
x------------------------------------------------x

DECISION

AUSTRIA-MARTINEZ, J.:

The parties in this case are vying for ownership of a 4,300 square meter-land located in Barangay Basilisa, Remedios T. Romualdez,

Agusan del Norte.

Petitioners-spouses Encarnacion L. Cuizon and Salvador Cuizon rely on Transfer Certificate of Title (TCT) No. RT-3121 in the name of

Encarnacion L. Cuizon, married to Salvador Cuizon, issued by the Registry of Deeds of Agusan del Norte on March 15, 1984,[1] pursuant to a

notarized Extra-Judicial Settlement with Sale dated August 3, 1983 (1983 Extra-Judicial Settlement with Sale) executed by the heirs of

Placida Tabada-Lambo (Placida), wherein they adjudicated unto themselves the one-fourth share of Placida, and, at the same time, sold said

portion to their co-heir, Encarnacion L. Cuizon.[2] TCT No. RT-3121 is a transfer from TCT No. RT-183 which originally covers 16 hectares in

the name of Placida (married to Gervacio Lambo), Eugenio Tabada, Raymunda Tabada and Patrecia Tabada, each being one-fourth

shareowner.[3]

On the other hand, respondents have in their favor a notarized Deed of Sale of Real Property dated September 19, 1968, (1968

Deed of Sale) involving a portion of the same property covered by TCT No. RT-183, measuring 4,300 square meters, executed by Placida in

favor of Angel Remoto (Angel), husband of respondent Mercedes C. Remoto, and father of the other respondents, Leonida R. Meynard,

Celerina R. Rosales and Remedios C. Remoto.[4]

In a Decision dated March 9, 1990 rendered by the Regional Trial Court of Butuan City (Branch 3) in Civil Case No. 2846, which is an

action for reconveyance filed by respondents against petitioners on August 13, 1984, the trial court ruled in favor of respondents and ordered

that the property be reconveyed to them. The dispositive portion of the decision reads:

Wherefore, judgment is rendered in favor of herein plaintiffs Mercedes Remoto and children Celerino R. Rosales,
Leonida R. Meynard, Candelaria and Remedios both surnamed Remoto, and against defendant-spouses Salvador and
Encarnacion Cuizon ordering the latter:

1) To immediately reconvey the lot in question to herein plaintiffs;

2) To pay the sum of Two Thousand (P2,000.00) Pesos as litigation expenses;

3) To pay the sum of Five Thousand (P5,000.00) Pesos as attorneys fees; and

4) To pay the costs (sic) of suit.

Done in Chambers this 9th day of March, 1990, at Butuan City, Philippines.[5]

In awarding the property to respondents, the trial court made the following findings and conclusion, which the Court quotes with

approval, viz.:

. . . a careful examination of the evidence on record shows that the evidence of the plaintiffs is strong,
substantial convincing and worthy of belief than that of the defendants. The plaintiffs can legally claim possession and
ownership of the lot in dispute covered by the onepaged duly notarized but unregistered Deed of Sale of Real Property
(Exh. A, Rollo, p. 45 or 89). A perusal of this document discloses that it was duly notarized and signed by vendor Placida
Tabada, together with [h]usband Gervacio Lambo, and vendee Angel Remoto. Incidentally, the defendants-spouses utterly
failed to prove any defect and irregularity in the exec[u]tion of this Exh. A.

It is the posture of the defendants-spouses that this state (sic) and unregistered deed of sale (Exh. A) has lost its
due execution and genuineness and the fact of its being a public document; that it cannot defeat the duly registered Deed
 of Extrajudicial Settlement with Absolute Sale (Exh. 1-B); and that the issuance of TCT No. RT-3121 in favor of
defendants-spouses (Exh. 3) conferred the latter a better right to the litigated lot under the Torrens system.

This Court is not in accord to (sic) these posturings of defendants-spouses. Exhibit A, which is duly notarized, is a
public document. Although it is not registered, it is still enforceable and binding not only between the parties but also their
successors-in-interest.

It is likewise [the] stance of defendants-spouses that they are purchasers in good faith and for value of the lot in
question. This fact is vividly rebutted by the straight forward and credible testimonies of plaintiffs Mercedes O. Remoto and
Candelaria Remoto. Both testified that it was in September, 1982, not in 1983 as defendant Salvador Cuizon wants this
court to believe, when defendants-spouses went to the residence of the Remotos and learned of the existence of Exhibit A;
that it was on this occasion that defendants-spouses were actually shown the document, and that they read and examined
the same (Vide, tsn. December 28, 1984, 284-289; tsn. April 24, 1986, 32, 34-37).

Besides, defendants-spouses could not feign ignorance of the unrebutted fact that the plaintiffs had enjoyed
continuous, open, adverse and public possession of the litigated lot in the concept of an owner for a duration of fourteen
years or more, i.e., from September 19, 1968, the date of execution of Exhibit A, to the present (tsn. December 28, 1984,
283-284) or until September, 1982 when they became aware of the existence of Exhibit A. Nor could the defendants-
spouses deny the unrebutted fact that they never had taken possession of the litigated lot (tsn. id., 274-275).

Despite their knowledge of the existence of the Exhibit A and of the continuous public and adverse possession for
fourteen years of the lot by the plaintiffs, defendants-spouses had caused the execution of the Deed of Extrajudicial
Settlement with Sale on August 3, 1983 by the Heirs of Placida Tabada-Lambo in their favor (Exh. 1-B), and the
consequent issuance of TCT RT-3121 in the name of defendant Encarnacion-Cuizon (Exh. 3). Hence, defendants-spouses
were buyers in bad faith. They could not pretend a lack of knowledge of plaintiffs claim and interest in the land. They also
acted in bad faith in the registration of the Deed of Extrajudicial Settlement with Sale (Exh. 1-B) and in their acquisition of
TCT RT-3121 (Exh. 3).

Since defendants-spouses knew of the existence of the first deed of sale, Exhibit A, this first unregistered deed of
sale prevails over the registered second deed of sale, Exhibit 1-B.

It is also stressed herein that the claim of defendants-spouses that they bought the disputed lot in 1964 on
installment basis from Placida Tabada and Gervacio Lambo cannot be given credence. This claim of theirs is self-serving
and an afterthought in their last attempts to bolster their defense. In the absence of a written document embodying the
supposed deed of sale, the latter is unenforceable contract. This conclusion is in pursuance to sub-paragraph (e),
paragraph 2 of Art. 1403 of the Civil Code.

Furthermore, it is the submission of the defendants-spouses that Exhibit A is a simulated contract because the
questioned lot was intended for donation as a barrio site. This submission of their (sic) cannot be sustained in the absence
of a written deed of donation.

In fine, this Court finds and so holds that the Deed of Sale of Real Property of September 1968 (Exh. A) can be
the legal basis not only of the possession and ownership of the lot in litigation, but also for the reconveyance of the same
in favor of the plaintiffs.[6]

On appeal by petitioners, docketed as CA-G.R. CV No. 31587, the Court of Appeals (CA) affirmed the findings and conclusion of the

trial court in its Decision[7] dated December 16, 1999, the dispositive portion of which reads:

WHEREFORE, foregoing premises considered, the instant appeal being devoid of any merit in fact and in law, is
hereby ordered DISMISSED; and the decision appealed from hereby AFFIRMED IN TOTO.

With cost to Defendants-appellants.

SO ORDERED.[8]

Petitioners filed a motion for reconsideration but the CA denied it per Resolution dated March 31, 2000.[9]

In the present petition for review, petitioners insist that they are the rightful owners of the property based on TCT No. RT-3121, and

that the 1968 Deed of Sale is void, fictitious, unenforceable and has no legal effect. Petitioners also argue that: (1) the property is covered by

TCT No. RT-183 issued on June 21, 1930, and every person dealing with registered land may safely rely on the correctness of the title; (2) at

the time the 1968 Deed of Sale was executed, no written notice was given to all possible co-redemptioners, co-heirs, and co- owners, as

provided for under Articles 1620 and 1623 of the Civil Code; (3) respondents possession is ineffectual against a torrens title; and (4)

respondents action is barred by prescription and laches.[10]

The issue in this case is: who has a better right to the property in dispute?

As a rule, the Court cannot review the factual findings of the trial court and the CA in a petition for review on certiorari under Rule

45 of the Rules of Court.[11] It should be stressed that a review by certiorari under Rule 45 is a matter of discretion. Under this mode of

review, the jurisdiction of the Court is limited to reviewing only errors of law, not of fact. When supported by substantial evidence,

findings of fact of the trial court as affirmed by the CA are conclusive and binding on the parties.[12] This Court will not review

unless there are exceptional circumstances, viz.: (a) where the conclusion is a finding grounded entirely on speculation, surmise and

conjectures; (b) where the information made is manifestly mistaken; (c) where there is grave abuse of discretion; (d) where the judgment is
based on a misapplication of facts, and the findings of facts of the trial court and the appellate court are contradicted by the evidence on

record; and (e) when certain material facts and circumstances had been overlooked by the trial court which, if taken into account, would alter

the result of the case.[13] There exists no exceptional circumstance in this case that would warrant a departure from the factual findings of

both the trial court and the CA.

As correctly ruled by both the trial court and the CA, the 1968 Deed of Sale executed by Placida in favor of Angel should prevail over

the 1983 Extra-Judicial Settlement with Sale made by the heirs of Placida in favor of petitioners-spouses Cuizon. Prior tempore, potior jure. It

simply means, He who is first in time is preferred in right. The only essential requisite of this rule is priority in time, and the only one who can

invoke this is the first vendee.[14] Records bear the fact that when Placida sold her one-fourth portion of the property covered by TCT No. RT-

183 in 1968, the 1983 Extra-Judicial Settlement with Sale was still inexistent, and more importantly, said portion was yet to be transferred by

succession to Placidas heirs. The records also show that after Placida sold her portion to Angel, the latter immediately took possession of the

same. Applying the principle of priority in time, it is clear that Angel, and consequently his heirs, the respondents herein, have a superior

right to the property.

It must be noted that the sale by Placida to Angel is evidenced by a duly notarized deed of sale. Documents acknowledged before

notaries public are public documents and public documents are admissible in evidence without necessity of preliminary proof as to their

authenticity and due execution. They have in their favor the presumption of regularity, and to contradict the same, there must be evidence

that is clear, convincing and more than merely preponderant.[15] Petitioners failed to present any clear and convincing evidence to prove that

the deed of sale is void, fictitious, unenforceable and has no legal effect.

Petitioners harp on the fact that the 1968 Deed of Sale dated September 19, 1968, while notarized, was not registered or annotated

on TCT No. RT-183. Petitioners must be reminded that registration is not a requirement for validity of the contract as between the parties, for

the effect of registration serves chiefly to bind third persons.[16] Petitioners are not third persons within the contemplation of the registration

rule. The conveyance shall not be valid against any person unless registered, except (1) the grantor, (2) his heirs and devisees, and (3) third

persons having actual notice or knowledge thereof. Petitioners are both related to the original owner of the property, Placida. Petitioner

Encarnacion Lambo-Cuizon is an heir of Placida, while Salvador Cuizon is Encarnacions husband. Hence, registration is not required to bind

petitioners.

Furthermore, where the party has knowledge of a prior existing interest which is unregistered at the time he acquired a right to the

same land, his knowledge of that prior unregistered interest has the effect of registration as to him. [17] As was found by the trial court, before

petitioners bought the property in 1983, they went to the Remotos residence in 1982 and were shown a copy of the 1968 Deed of Sale. While

petitioners dispute the year, saying that it was in 1983 and not 1982 when they went to the Remotos residence, the Court abides by the trial

courts finding considering that it was in the best position to assess the respective testimonies of the contending claimants.[18]

Petitioners rely heavily on TCT No. RT-3121 issued in their names. In the first place, the issuance of the title was made pursuant to

the 1983 Extra-Judicial Settlement with Sale. At the time this document was entered into by the heirs of Placida, the latter was no longer the

owner of the property, having earlier sold the same to Angel. No one can give what one does not have -- nemo dat quod non

habet. Accordingly, one can sell only what one owns or is authorized to sell, and the buyer can acquire no more than what the seller can

transfer legally.[19] Such being the case, the heirs of Placida did not acquire any right to adjudicate the property unto them and sell it to

Encarnacion.
 Whats more, the defense of indefeasibility of the torrens title does not extend to a transferee who takes the certificate of title with

notice of a flaw in his title. The principle of indefeasibility of title is unavailing where there was fraud that attended the issuance of the free

patents and titles.[20] As previously noted, petitioners knew of the existence of the 1968 Deed of Sale as the Remotos showed it to them in

1982, a year before the execution of the 1983 Extra-Judicial Settlement with Sale. Thus, it cannot be said that petitioners are transferees in

good faith and therefore, the defense of indefeasibility of the torrens title is not applicable to them.

Likewise, petitioners cannot complain that no written notice was given to all possible redemptioners or heirs at the time of the

execution of the 1968 Deed of Sale. Under the provisions of the Civil Code on Legal Redemption, it is stated:

Article 1620. A co-owner of a thing may exercise the right of redemption in case the shares of all the other co-
owners or of any of them, are sold to a third person. If the price of the alienation is grossly excessive, the redemptioner
shall pay only a reasonable one.

Should two or more co-owners desire to exercise the right of redemption, they may only do so in proportion to
the share they may respectively have in the thing owned in common.

Art. 1623. The right of legal pre-emption or redemption shall not be exercised except within thirty days from the
notice in writing by the prospective vendor, or by the vendor, as the case may be. The deed of sale shall not be recorded
in the Registry of Property, unless accompanied by an affidavit of the vendor that he has given written notice thereof to all
possible redemptioners.

The right of redemption of co-owners excludes that of adjoining owners.

Corollary to these, Article 1088 of the Civil Code, provides:

Art. 1088. Should any of the heirs sell his hereditary rights to a stranger before the partition, any or all of the co-
heirs may be subrogated to the rights of the purchaser by reimbursing him for the price of the sale, provided they do so
within the period of one month from the time they were notified in writing of the sale by the vendor.

The right of legal redemption pertains to Placidas original co-owners, namely, Eugenio Tabada, Raymunda Tabada and Patrecia

Tabada, and their respective heirs,[21] not to petitioners who are the heirs of Placida. Also, the written notification should come from the

vendor or prospective vendor, Placida in this case, and not from any other person. [22] This is so because the vendor is in the best position to

know who are his co-owners that under the law must be notified of the sale. Also, the notice by the seller removes all doubts as to fact of the

sale, its perfection; and its validity, the notice being a reaffirmation thereof, so that the party notified need not entertain doubt that the seller

may still contest the alienation. This assurance would not exist if the buyer should give the notice.[23]

Even if the property has not yet been formally subdivided, still, records show that the particular portions belonging to the co-owners

have already been allocated and Placidas co-owners have already been exercising proprietary rights over their respective allotments. Thus,

inscribed on TCT No. RT-183 are several deeds of mortgages executed by Placidas co-owner Eugenio C. Tabada in favor of the Butuan City

Rural Bank with respect to his one-fourth share, and a Deed of Sale with Right of Repurchase dated May 13, 1968 executed by the spouses

Eugenio G. Tabada and Trinidad Ontong in favor of one Hernando R. Sanchez, also covering Eugenios one-fourth portion of the property.[24]

The Court notes, however, that the property originally co-owned by Placida, Eugenio Tabada, Raymunda Tabada and Patrecia

Tabada, covered by TCT No. RT-183, measures 16 hectares, while the 1968 Deed of Sale covers 4,300 square meters.

The right of Placida to sell her one-fourth portion of the property covered by TCT No. RT-183 is sanctioned under Article 493 of the

Civil Code, to wit:

Art. 493. Each co-owner shall have the full ownership of his part and the fruits and benefits pertaining thereto,
and he may therefore alienate, assign or mortgage it, and even substitute another person in its enjoyment, except when
personal rights are involved. But the effect of the alienation or the mortgage, with respect to the co-owners, shall be
limited to the portion which may be allotted to him in the division upon the termination of the co-ownership.
 The sale to Angel affects only Placidas pro indiviso share in the property, and Angel gets only what corresponds to Placidas share in

the partition of the property owned in common. Since a co-owner is entitled to sell his undivided share, a sale of the entire property by one

co-owner without the consent of the other co-owners is not null and void; only the rights of the co-owner/seller are transferred, thereby

making the buyer a co-owner of the property.[25]

Given the foregoing, the portion sold by Placida and bought by Angel under the 1968 Deed of Sale should only pertain to

one-fourth of Placidas share in the 16-hectare property, or 4,000 square meters.

Lastly, prescription and laches do not apply in this case. To begin with, respondents have been in actual and continuous possession

of the property since Angel first bought it in 1968. If a person claiming to be the owner thereof is in actual possession of the property, the

right to seek reconveyance, which in effect seeks to quiet title to the property, does not prescribe. The reason for this is that one who is in

actual possession of a piece of land claiming to be the owner thereof may wait until his possession is disturbed or his title is attacked before

taking steps to vindicate his right, the reason for the rule being, that his undisturbed possession gives him a continuing right to seek the aid

of a court of equity to ascertain and determine the nature of the adverse claim of a third party and its effect on his own title, which right can

be claimed only by one who is in possession.[26]

Neither can respondents be held guilty of laches. On the contrary, it was respondents vigilance in protecting their right over the

property that gave rise to the present case. Their action for reconveyance was filed only after one year and ten days from the execution of

the 1983 Extra-Judicial Settlement with Sale, one year and three days after its registration, and four months and twenty-eight days after the

issuance of TCT No. RT-3121. Obviously, laches has not yet set in.

WHEREFORE, the petition is DISMISSED. The Court of Appeals Decision dated December 16, 1999 together with its Resolution

dated March 31, 2000 in CA-G.R. CV No. 31587 is AFFIRMED. SO ORDERED.

NAPOLEON PORTES, SR., G.R. No. 145264
MARIA PORTES, and HEIRS OF
NAPOLEON PORTES, SR. namely
NAPOLEON PORTES, JR.,
NESTOR PORTES,
REBECCA PORTES,
ROSALINA PORTES-ISUGA,
and NICANOR PORTES,
Petitioners,

- versus –

SEGUNDA ARCALA, EULALIA

ARCALA, SALUSTANCIA ARCALA,
VAMERCO ARCALA, JOSEFINA
ARCALA, FELOMINO ARCALA,
MARCIANO ARCALA, LYDIA Promulgated:
ARCALA, and SALOME ARCALA,[1]
Respondents. _ August 30, 2005

x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - x
DECISION

CARPIO, J.:

The Case

Before us is a petition for review of the Decision[2] of the Court of Appeals in CA-G.R. CV No. 50107 dated 14 August 2000 affirming

the Decision[3] of the Regional Trial Court of Negros Occidental, Branch 51, Bacolod City in Civil Case No. 1815.

The Antecedent Facts

This case stems from a complaint for recovery of possession and annulment of titles filed on 21 April 1977 by respondents Segunda,

Eulalia, Salustancia, Vamerco, Josefina, Felomino, Marciano, Lydia, and Salome, all surnamed Arcala.

Respondents claimed that as early as 1908, their parents, Vicente and Felisa, had already occupied and developed the disputed

parcels of land, Lots 2 and 3. These two lots are located in Sitio Pagba, Mansalanao, La Castellana, Negros Occidental. On 20 June 1912, the

Director of Lands approved Vicentes homestead application for Lots 2 and 3. Vicente and Felisa were in open, exclusive and continuous

possession of Lots 2 and 3 until their deaths in 1930 and 1940, respectively. As Vicente and Felisas heirs, respondents succeeded them in

their rights over Lots 2 and 3. Respondents then took possession of Lots 2 and 3.

Respondents filed the complaint against their cousins, Vicente, Jr., Perfecta, Sotera, and Consolacion, all surnamed Arcala. Vicente,

Jr., Perfecta, Sotera, and Consolacion are the nephew and nieces of respondents father, Vicente. Vicente, Jr., Perfecta, Sotera, and

Consolacion were impleaded with their respective spouses, Ramona, Roberto Cadongon, Alfredo Magsico, and Martin Mujas. Also impleaded as

defendants were Felomina Gustilo (Felomina), Angel Gustilo (Angel), Luis Gustilo (Luis), spouses Enrique and Pacita Palmares (Enrique and

Pacita), and Napoleon Portes, Sr. (Napoleon), the predecessor-in-interest of petitioners.

Respondents alleged that on 30 November 1917, Felomina, the aunt of Luis, registered Lots 1, 2, 3, 4, 5 and 6 in her name. These

lots are situated in Barrio Mansalanao, Pontevedra, Negros Occidental and described in Plan II-12285. The decree of registration dated 11

November 1920 was issued to Felomina by the Court of First Instance of Negros Occidental in GLRO Case No. 15426. However, on 26 July

1930, the cadastral court issued another decree of registration excluding Lots 2 and 3 from the decree of registration issued to Felomina. The
cadastral court amended Felominas decree of registration because Vicente and Felisa had already obtained a homestead patent over Lots 2

and 3. The Director of Lands issued another plan to Felomina. The new plan reflected the true area of Felominas land. From 196.3176

hectares, Felominas registered land area was reduced to 164.9178 hectares, composed only of Lots 1, 4, 5, and 6.

Despite the amended decree of 26 July 1930, Felomina was still able to have the title of Lot 2 reconstituted by invoking GLRO Case No.

15426. On 31 March 1964, the reconstituted title of Lot 2, OCT No. RO-8932, was issued to Felomina. Felomina then subdivided Lot 2 into

Lots 2-A and 2-B. In December 1964, OCT No. RO-8932 was cancelled. TCT No. T-39331 covering Lot 2-A was issued to Luis while TCT No. T-

39332 covering Lot 2-B was issued to Felomina.

In 1966, Vicente, Jr., Sotera and Perfecta had Lot 2-B subdivided. Vicente, Jr. pretended to be the son of Vicente, respondents

father, and had the subdivided portions of Lot 2-B titled in this manner: Lot 2-B-3 covered by TCT No. T-44568 in Vicentes name; Lot 2-B-1

covered by TCT No. T-44566 in Perfectas name; and Lot 2-B-2 covered by TCT No. T-44567 in Soteras name.

On 21 February 1967, Vicente, Jr., Sotera and Perfecta executed a Deed of Absolute Sale over the properties in favor of Enrique and

Pacita. Later, TCT Nos. T-46568, T-46567 and T-46569 covering Lots 2-B-1, 2-B-2 and 2-B-3, respectively, were issued to Enrique and

Pacita.

Luis sold Lot 2-A to Napoleon as evidenced by a Deed of Sale of Realty with Assumption of Mortgage dated 28 December 1967. TCT No. T-

65157 covering Lot 2-A was subsequently issued to Napoleon.

On 3 August 1970, Angel and a certain Eleuteria Espinosa (Eleuteria), reconstituted the title of Lot 3. OCT No. RO-10754 (11988)

was issued to Angel and Eleuteria.

Respondents, who were still in possession of Lots 2 and 3, learned of defendants fraudulent acts in 1966 when Vicente, Jr. claimed ownership

of Lot 2. Segunda had the land dispute investigated by the Bureau of Lands.

The investigation report of the Bureau of Lands dated 24 February 1970 was favorable to respondents. The investigation report

recommended the revocation of Felominas certificates of title over Lot 2. On 9 October 1970, Segunda caused the annotation of an adverse

claim on the transfer certificates of title of Lots 2 and 3.

On 23 October 1970, certain persons acting in behalf of Luis forcibly entered Lot 3. Luis allegedly caused the imprisonment of Segunda and

respondents tenant, Valentino Serapio (Valentino) for refusing to give a share of the lands produce to either Luis or Vicente, Jr.

Respondents prayed for the nullification of petitioners certificates of title, turning over of possession of Lots 2 and 3 to respondents

and payment of 30% of whatever may be recovered as attorneys fees and litigation expenses.

In his Answer, Luis claimed that he is the registered owner of Lot 3 with the corresponding title. Luis denied entering the property through

force, stealth, strategy and intimidation. Luis insisted that the present action is barred by prior judgment in Felominas favor. During the trial,

Luis died. He was substituted by his daughter Concepcion Gustilo.

 Spouses Enrique and Pacita asserted in their Answer with Counterclaim that they purchased Lots 2-B-1, 2-B-2 and 2-B-3 from

Perfecta, Sotera, and Vicente, Jr. in good faith and for value. The certificates of title did not contain any annotation of encumbrance. Ever

since Enrique and Pacita acquired the lots in 1967, they have been in possession of the lots, paying the land and educational taxes on the

lots.

Vicente, Jr., Sotera, Perfecta and Consolacion were declared in default for their failure to file their answer despite service of

summons.

Napoleon was substituted by his heirs Maria, Napoleon, Jr., Nestor, Rebecca, Rosalina and Nicanor, all surnamed Portes. In their

Answer, the heirs of Napoleon insisted that Napoleon acquired ownership of Lot 2-A in good faith and for value. The heirs of Napoleon argued

that the action has prescribed and laches now bars the action.

On 5 September 1994, the trial court rendered judgment in favor of respondents. Petitioners appealed to the Court of Appeals.

On 14 August 2000, the Court of Appeals affirmed the trial courts decision in its entirety. Hence, this petition.

The Ruling of the Trial Court

The trial court ruled that respondents own Lots 2 and 3.

Felominas reconstituted title over Lot 2 is void because she had no right to reconstitute the title of this property. Vicente, Jr.,

Sotera, Perfecta, Consolacion, Luis, Napoleon and the spouses Enrique and Pacita, the subsequent buyers of the subdivided portions of Lot 2,

were not innocent purchasers. All of them had notice of the flaws of the certificates of title. Vicente, Jr., Sotera, Perfecta, and Consolacion

were declared in default because of their failure to file their answer despite notice.

Angel and Eleuteria also had no prior title over Lot 3 to reconstitute. Angel and Eleuterias title over Lot 3 is thus void.

The dispositive portion of the trial courts decision reads as follows:

ACCORDINGLY, judgment is hereby rendered in favor of plaintiffs and against defendants, declaring null and
void:

1. Transfer Certificate of Title No. T-46568 for Lot 2-B-1 of the subdivision plan (LRC) Psd-58548, being a portion
of Lot No. 2-B (LRC) Psd-38764, LRC Cad. Rec. No. 117, situated in the Barrio of Mansalanao, Pontevedra,
Negros Occidental, in the names of the spouses Enrique Palmares and Pacita Palmares;

2. Transfer Certificate of Title No. T-46567 for Lot 2-B-2 of the subdivision plan, LRC Psd-58548, being a portion of
Lot No. 2-B, LRC Psd-38764, LRC Cad. Rec. No. 117, situated in the Barrio of Mansalanao, Pontevedra, Negros
Occidental, in the names of the spouses Enrique Palmares and Pacita Palmares;

3. Transfer Certificate of Title No. T-46569 for Lot No. 2-B-3 of the subdivision plan, LRC Psd-58548, being a
portion of Lot No. 2-B, LRC Psd-38764, LRC Cad. Rec. No. 117, situated in the Barrio of Mansalanao,
Pontevedra, Negros Occidental, in the names of the spouses Enrique Palmares and Pacita Palmares;

4. Transfer Certificate of Title No. T-46569 for Lot No. 2-B-4 of the subdivision plan, LRC Psd-58548, being a
portion of Lot No. 2-B, LRC Psd-38764, LRC Cad. Rec. No. 117, situated in the Barrio of Mansalanao,
Pontevedra, Negros Occidental, in the names of Consolacion Arcala, married to Martin Mujas;
 5. Transfer Certificate of Title No. T-65157 for Lot No. 2-A, being a portion of Lot 2, Cad. Rec. No. 117, situated in
the Barrio of Mansalanao, Pontevedra, Negros Occidental, in the names of the spouses Napoleon Portes and
Maria Portes;

and ordering:

1. Defendant-spouses Enrique Palmares and Pacita Palmares to deliver and peacefully turn over possession of Lot
Nos. 2-B-1, 2-B-2, and 2-B-3 to herein plaintiffs;

2. Defendant Consolacion Arcala, married to Martin Mujas, to deliver and turn over peacefully possession of Lot
No. 2-B-4 to herein plaintiffs;

3. Defendant-spouses Napoleon Portes and Maria Portes, to deliver and turn over peacefully possession of Lot No.
2-A to herein plaintiffs;

4. Defendant Angel Gustilo and his successor-in-interest, to deliver and turn over peacefully possession of Lot
No. 3 to herein plaintiffs;

5. Defendants to pay plaintiffs, by way of attorneys fee[s] 20% per centum of the fair market value of the land
they each possessed;

6. Defendants to jointly and severally pay the costs. SO ORDERED.[4]

The Ruling of the Court of Appeals

Only the heirs of Napoleon appealed from the decision of the trial court. The Court of Appeals affirmed the trial courts decision. The Court of

Appeals explained that a party could invoke indefeasibility of title, prescription and laches if no valid title exists. Moreover, in the present case

the transferees had notice of the flaw in their titles.

The dispositive portion of the decision reads:

WHEREFORE, premises considered, the appealed decision in Civil Case No. 1815 is hereby AFFIRMED in its
entirety. Costs against the defendants-appellants. SO ORDERED.[5]

The Issues

The heirs of Napoleon raise the following issues:

1. WHETHER PETITIONERS NAPOLEON PORTES, SR. AND MARIA PORTES HAVE ACQUIRED LOT 2-A IN GOOD
FAITH AND FOR VALUE;

2. WHETHER PETITIONERS NAPOLEON PORTES, SR. AND MARIA PORTES HAVE ACQUIRED VALID TITLE TO LOT 2-
A;

3. WHETHER THE DOCTRINES OF LACHES, PRESCRIPTION AND INDEFEASIBILITY OF TITLE UNDER THE TORRENS
SYSTEM OR REGISTRATION ARE APPLICABLE TO THE TITLE OF PETITIONERS OVER LOT 2-A.[6]

The Ruling of the Court

A judgment is final and executory against a party who does not appeal. [7] Only the heirs of Napoleon appealed from the decision of the trial

court with the Court of Appeals and filed the present petition before the Court. Thus, the decisions of the trial court and the Court of Appeals

are final and executory on Felomina and Luis, Angel, and the spouses Enrique and Pacita, Perfecta and Roberto, Sotera and Alfredo, Vicente,

Jr. and Ramona, and Consolacion and Martin.

The appeals filed by the heirs of Napoleon did not inure to the benefit of their co-defendants. The rights and liabilities of the heirs of Napoleon

and their co-defendants are not dependent on each other.[8] In this case, the defense of being an innocent purchaser for value is unique to
each party. Moreover, the parties were represented by different counsels during trial. The counsels could not have legally acted for each

other. [9] Therefore, when the heirs of Napoleon appealed from the decisions of the trial and appellate courts, they were acting only for

themselves.

We thus limit our discussion to the rights of the heirs of Napoleon over Lot 2-A.

A homestead patent, once registered under the Land Registration Act, becomes as indefeasible as a Torrens Title. [10] Respondents

parents, Vicente and Felisa, owned Lots 2 and 3 by virtue of a homestead patent. The 26 July 1930 decision of the cadastral court recognized

the indefeasibility of Vicente and Felisas homestead patent when it excluded Lots 2 and 3 from the decree of registration it had issued to

Felomina.

Felomina had no right over Lot 2. However, Felomina still caused the reconstitution of the title of Lot 2. Reconstitution is simply the

restoration of a lost or destroyed instrument or title to its original form and condition.[11] Felomina had nothing to reconstitute as no

certificate of title was ever issued to her over Lot 2. The fraud in the reconstitution of Lot 2 is evident.

Luis, from whom Napoleon purchased Lot 2-A, was just as guilty as his aunt Felomina in defrauding respondents. Respondents were

still in possession of Lot 2 when Luis supposedly purchased the lot from Felomina and when Luis had the lot subdivided and the subdivided

lots titled. Luis was definitely not a buyer in good faith. The only way for the heirs of Napoleon to validly claim Lot 2-A is to prove that

Napoleon purchased Lot 2-A in good faith.

The trial and appellate courts ruled that Napoleon was not a purchaser in good faith. We agree with the two courts.

The trial and appellate courts pointed out that as early as 1966, there was already a brewing dispute between respondents and Luis

over Lot 2. Luis conveyed Lot 2-A, one of the subdivided portions of Lot 2, to Napoleon on 28 December 1967. Maria, Napoleons widow,

testified that she was with Napoleon when Luis sold to them Lot 2-A.[12]Maria asserted that she was familiar with the history of Lot 2-A and

the supposed previous owners, Luis and Felomina.[13] It was thus impossible for Napoleon and Maria not to have known of the Bureau of

Lands pending investigation and the incarceration of Segunda and Valentino at the time Luis sold to them Lot 2-A. The controversy between

respondents and Luis should have prompted Napoleon to inquire into the status of Luis title over Lot 2-A. A purchaser cannot close his eyes to

facts that should put a reasonable man on his guard and still claim that he acted in good faith. [14] A holder in bad faith of a certificate of title

is not entitled to the protection of the law.

Assuming that Napoleon was unaware of the conflict over Lot 2-A at the time of the execution of the deed of sale, Napoleon was,

however, already charged with knowledge of the flaw in Luis title at the time of the registration of the sale. Inscriptions of an adverse claim
dated 23 November 1970 and lis pendens dated 14 September 1971 were already annotated on Luis title over Lot 2-A when Napoleon

registered the Deed of Sale on 16 December 1971.

While the sale between Luis and Napoleon bound both parties, the registration of the sale with the property registry is what binds

third parties and the world to the transfer of ownership.[15] Moreover, registration alone without good faith is not sufficient.[16] Good faith

must concur with registration for such prior right to be enforceable.[17]

The notice of lis pendens is an announcement to the whole world that a particular real property is in litigation.[18] The inscription

serves as a warning that one who acquires an interest over litigated property does so at his own risk, or that he gambles on the result of the

litigation over the property.[19] By disregarding the inscriptions and pursuing the registration of the sale, Napoleon assumed the risk of losing

Lot 2-A to respondents. Napoleons heirs, being merely the juridical continuation of his personality, hold Lot 2-A in trust for respondents.

Respondents action for reconveyance is not barred by prescription. The fraudulent registration of a parcel of land holds the person in

whose name the land is registered as a mere trustee of an implied trust for the benefit of the person from whom the property comes.[20] An

action for reconveyance of registered land based on implied trust prescribes in ten years even if the decree of registration is no longer open to

review.[21] However, when the adverse claimants are still in possession of the property in dispute, the action for reconveyance, which in effect

seeks to quiet title to property in ones own possession, is not subject to prescription.[22]

At the time that Felomina and Luis fraudulently titled Lot 2 in their names, Vicente and Felisa, respondents parents, were still in

possession of Lot 2. Vicente and Felisas right to file an action for reconveyance was thus not subject to prescription. Respondents remained in

possession of Lot 2 until 1967 when they were ousted from Lot 2-A. Since respondents were no longer in possession of Lot 2-A, the ten-year

prescriptive period must be reckoned from the time that TCT No. T-65157 covering Lot 2-A was issued to Napoleon, which was on 16

December 1971. Prescription had not yet set in as the action for reconveyance was filed on 21 April 1977, or only six years after title to Lot 2-

A was issued to Napoleon.

Respondents are not estopped by laches. Laches or stale demands is the failure or neglect for an unreasonable and unexplained

length of time to do that which, by exercising due diligence, could or should have been done earlier. Laches gives rise to a presumption that

the party entitled to assert a right either has abandoned or declined to assert it. [23] Respondents vigilance in asserting and protecting their

rights over Lot 2-A is on record. They initiated the investigation with the Bureau of Lands and registered their adverse claims on the

certificate of title of Lot 2-A even before title was transferred to Napoleon. Respondents are far from guilty of sleeping on their rights.

Attorneys fees may be awarded when the defendants act or omission has compelled the plaintiff to incur expenses to protect his

interest.[24] The trial court ordered petitioners to pay 20% of the fair market value of the land they each possessed as attorneys fees. We

modify the award of attorneys fees. The heirs of Napoleon shall pay attorneys fees of P50,000.
 WHEREFORE, we DENY the petition. We AFFIRM with MODIFICATION the appealed Decision of the Court of Appeals dated 14

August 2000 in CA-G.R. CV No. 50107. We ANNUL Transfer Certificate of Title No. T-65157 of Lot 2-A, a portion of Lot 2, Cadastral Record

No. 117, situated in the Barrio of Mansalanao, Pontevedra, Negros Occidental, in the names of the spouses Napoleon, Sr. and Maria Portes.

The heirs of Napoleon Portes, Sr., Maria, Napoleon, Jr., Nestor, Rebecca, Rosalina, and Nicanor all surnamed PORTES shall pay P50,000

attorneys fees, and deliver and turn over possession of Lot 2-A to respondents Segunda, Eulalia, Salustancia, Vamerco, Josefina, Felomino,

Marciano, Lydia, and Salome, all surnamed ARCALA. The 5 September 1994 Decision of the Regional Trial Court of Negros Occidental,

6th Judicial Region, Branch 51, Bacolod City in Civil Case No. 1815 is FINAL and EXECUTORY on Felomina Gustilo, Angel Gustilo, Luis

Gustilo, spouses Vicente, Jr. and Ramona Arcala, Perfecta and Roberto Cadongon, Sotera and Alfredo Magsico, Consolacion and Martin Mujas,

and Enrique and Pacita Palmares. Costs against petitioners. SO ORDERED.

RICARDO SANTOS and G.R. Nos. 170096-97

PAULA SANTOS WONG,

Petitioners,

- versus -

ILUMINADA CRUZ, represented by

Attorney-in-fact GLORIA ISRAEL,

JUDGE FRANCISCO LINDO, Promulgated:

MeTC, Branch 55, Malabon City,

Respondents. March 3, 2006

x ---------------------------------------------------------------------------------------- x

DECISION

YNARES-SANTIAGO, J.:

This is a petition for certiorari under Rule 65 of the Rules of Court assailing the Joint Decision [1] dated July 15, 2005 of the Regional Trial

Court, Branch 170, City of Malabon, which reversed the Joint Decision[2] of the Metropolitan Trial Court, Branch 55, City of Malabon.

The factual and procedural antecedents are as follows.

Respondent Iluminada Cruz is the owner of a parcel of land covered by TCT No. M-19968 and TCT No. 19973 of the Registry of Deeds of the

City of Malabon, portions of which were occupied by petitioners Ricardo Santos and Paula Wong, respectively.

Respondent Cruz filed two actions for ejectment docketed as Civil Case Nos. JL00-346 and JL00-347, against petitioners alleging that the

latter entered her lot without her consent and built thereon structures without her permission; that petitioners, being her relatives, were

allowed to stay free of charge on condition that they will vacate the premises upon demand; despite repeated demands, petitioners refused to

vacate the said lots, and in view of the failure of the contending parties to arrive at an amicable settlement, respondent was constrained to

file the instant suit.

In answer, petitioner Ricardo Santos and spouse admitted respondents ownership of the land covered by TCT No. M-19968 but alleged that

177 sq. m. thereof was sold to them on August 28, 1978 as evidenced by a Deed of Absolute Sale[3] in their favor.

Petitioner Paula Wong, while admitting respondents ownership of the lot covered by TCT No. 19973, averred that a portion thereof, measuring

142 sq. m., was sold to her husband Marcos Santos by the respondent under a Subdivision Agreement with Contract of Sale dated July 31,

1976.[4]

In a Joint Decision dated February 4, 2005, the Metropolitan Trial Court of the City of Malabon, Branch 55 rendered judgment the

dispositive portion of which reads:

WHEREFORE, for failure of the plaintiff to prove by preponderance of evidence her cause of actions alleged in the
complaint, the case is hereby dismissed with cost against the plaintiffs (sic) while the defendants[] counterclaims in both
cases for payment of attorneys fee[]s are likewise dismissed for lack of merit. SO ORDERED.[5]

Dissatisfied, respondent Cruz filed an appeal before the Regional Trial Court of the City of Malabon which reversed and set aside the

judgment of the Metropolitan Trial Court, the decretal portion of which reads:

WHEREFORE, premises considered, finding the lower court having committed reversible error, the judgment
appealed from is hereby reversed and set aside and new one entered:

1. Appealed Case No. A5-014-MN (Civil Case No. JLOO-346)

a) Ordering the defendants Ricardo Santos and his spouse, and all persons claiming rights under them, to vacate
and demolish their structures/houses on the premises located at M. Sioson St., Dampalit, Malabon City,
 Metro Manila and surrender possession thereof to the plaintiff and/or any of her authorized
representative;

b) Ordering the defendants to pay, jointly and severally, a reasonable amount of Php20,000.00 monthly from
October 21, 2002, the date of the demand letter, for their continued use of the premises involved until
they finally vacate and surrender possession thereof to the plaintiff without the structures/houses which
they built thereon;

c) Ordering defendants-appellees jointly and severally, to pay an amount of Php30,000.00 as and for attorneys
fees plus the costs of the suit.

2. Appealed Case No. A5-015-MN (Civil Case No. JLOO-347)

a) Ordering the defendant Paula Santos, and all persons claiming rights under her, to vacate and demolish her
structure/house on the premises involved located at M. Sioson St., Dampalit, Malabon City, Metro
Manila and surrender possession thereof to the plaintiff and/or any of her authorized representative;

b) Ordering the defendant-appellee to pay, a reasonable amount of Php20,000.00 monthly from October 21,
2002, the date of the demand letter, for her continued use of the premises involved until she finally
vacates and surrender the possession thereof to the plaintiff without the structure/house which she built
thereon;

c) Ordering defendant-appellee to pay the amount of Php30,000.00 as and for attorneys fees plus the costs of
the suit. SO ORDERED.[6]

Without moving for reconsideration, petitioners filed a petition for certiorari before this Court decrying the alleged violation by the Regional

Trial Court of their right to procedural and substantive due process. However, in view of the manifest violation of the procedural

requirements, the Court issued a Resolution on October 3, 2005[7] ordering the petitioners to:

a) PAY the amount of P1,230.00 as balance for docket and other legal fees as required under Sec. 3, Rule 46 in relation to
Sec. 2, Rule 56; and

b) SUBMIT: (1) a certification against forum shopping, that is, a certification under oath by petitioners that they have
not theretofore commenced any other action involving the same issues thereof in the Supreme Court, the Court
of Appeals, or in the different divisions thereof, or any other tribunal or agency; if there is such other action or
proceeding, they must state the status of the same; and if they should thereafter learn that a similar action has
been filed or is pending before the Supreme Court, the Court of Appeals, or in the different divisions thereof, or
any other tribunal or agency, they undertake to promptly inform the aforesaid courts and other tribunal or
agency thereof within five (5) days therefrom as required by Sec. 1, Rule 65 and Sec. 3, Rule 46 in relation to
Sec. 2, Rule 56 and Sec. 5, Rule 7; (2) a statement of material date showing when notice of the assailed RTC
joint decision was received, to show that the petition was filed on time pursuant to Sec. 4, Rule 65 in relation to
the second paragraph of Sec. 3, Rule 46; (3) proof of service (e.g., a written admission of the party served, an
affidavit of the party serving/registry receipts) of the petition on the lower courts concerned and on the adverse
parties as required by Sec. 2(c), Rule 56, the third paragraph of Sec. 3, Rule 46 in relation to the first paragraph
of Sec. 2, Rule 56 and Sec. 13, Rule 13; and (4) proof of authority of Ricardo Santos to sign the verification in
behalf of the other petitioner. (Emphasis added)

After having paid the balance of the docket fees, petitioners submitted a two-page petition dated November 4, 2005,[8] which

purportedly was in compliance with the October 3, 2005 Resolution. A cursory perusal of the petition however, showed that it had the same

procedural infirmities as the original petition. The petition was written in old and torn piece of scratch paper, which does not look like a formal

pleading. The petition lacked certification against forum shopping, a statement of the material date showing when notice of the assailed

decision was received, proof of service, and proof of authority of Ricardo Santos to sign the verification on behalf of the other petitioner.

Even on the merits, petitioners case will not prosper. Petitioners anchor their claim of ownership on the photocopies of the alleged

Deed of Absolute Sale dated August 28, 1978 executed in favor of Ricardo Santos and his spouse and the Subdivision Agreement with

Contract of Sale dated July 31, 1976 allegedly executed in favor of Paula Wong and her deceased husband Marcos Santos. On the other hand,

respondent Cruz relies for her claim of ownership in the transfer certificates of title covering the assailed properties registered in her

name. These certificates of title, specifically TCT No. M- 19968 and TCT No. 19973, being genuine and valid on their face, are incontrovertible,

indefeasible, and conclusive against petitioners and the whole world. Thus, the unregistered deed of sale and the subdivision contract upon

which petitioners rely cannot prevail over the certificate of title in the name of respondent Cruz. To hold otherwise is to defeat the primary

object of the Torrens System which is to make the Torrens Title indefeasible and valid against the whole world.
 In filing the instant petition for certiorari, petitioners contend that their right to due process was violated by the trial court. However,

other than a general statement of such fact, the petition does not state what specific acts or omissions were committed by the lower court

that would constitute a violation of petitioners right to due process to warrant the invocation of the equitable remedy of certiorari.

The petition must allege the facts showing that the tribunal, board, or officer has acted without or in excess, or with grave abuse of

discretion, with prayer that judgment be rendered annulling or modifying the proceedings of such tribunal, board, or officer. It must likewise

allege that the petitioners, through a motion for reconsideration, has called the attention of the lower court upon such error or irregularity and

asked for its correction, unless such previous motion for reconsideration was unnecessary either because the proceeding in which the error

occurred is a patent nullity, or because the question of want or excess of jurisdiction had been squarely raised and submitted in the lower

court and the latter had squarely met and decided the same.[9]

As a general rule, the special civil action of certiorari may only be availed when the lower court or any of its officers, acted without or in

excess of jurisdiction or with grave abuse of discretion, and there is no plain, speedy, and adequate remedy in the ordinary course of law.

When an appeal is in itself a sufficient and adequate remedy that would promptly relieve the petitioner from the injurious effects of the order

or judgment complained of, existence of that appeal would bar the institution of the remedy of certiorari. [10]

The case of Cervantes v. Court of Appeals,[11] citing Flores v. Sangguniang Panlalawigan of Pampanga,[12] clarified that plain and adequate

remedy referred to in the foregoing Rule is a motion for reconsideration of the assailed Order or Resolution, the filing of which is an

indispensable condition to the filing of a special civil action for certiorari,[13] subject to certain exceptions, to wit:

(a) where the order is a patent nullity, as where the court a quo has no jurisdiction;

(b) where the questions raised in the certiorari proceedings have been duly raised and passed upon by the lower court, or
are the same as those raised and passed upon in the lower court;

(c) where there is an urgent necessity for the resolution of the question and any further delay would prejudice the interests
of the Government or of the petitioner or the subject matter of the action is perishable;

(d) where, under the circumstances, a motion for reconsideration would be useless;

(e) where petitioner was deprived of due process and there is extreme urgency for relief;

(f) where, in a criminal case, relief from an order of arrest is urgent and the granting of such relief by the trial court is
improbable;

(g) where the proceedings in the lower court are a nullity for lack of due process;

(h) where the proceedings was ex parte or in which the petitioner had no opportunity to object; and

(i) where the issue raised is one purely of law or public interest is involved.

In Cervantes v. Court of Appeals,[14] we further stressed that a writ of certiorari is a prerogative writ, never demandable as a

matter of right, never issued except in the exercise of judicial discretion. Hence, he who seeks a writ of certiorari must apply for it only in the

manner and strictly in accordance with the provisions of the law and the Rules. Petitioner may not arrogate to himself the determination of

whether a motion for reconsideration is necessary or not. To dispense with the requirement of filing a motion for reconsideration, petitioner

must show a concrete, compelling, and valid reason for doing so.

In the case at bar, petitioners did not file a prior motion for reconsideration from the decision of the trial court. Even as they alleged

in the petition that the lower court acted without jurisdiction when it rendered a decision without due process in the proceedings, the

averment of facts was incomplete.

Moreover, the instant petition for certiorari should have been filed with the Court of Appeals pursuant to the doctrine of hierarchy of

courts. Disregard of this rule warrants the dismissal of the petition. While the Courts original jurisdiction to issue a writ of certiorari is

concurrent with the Regional Trial Courts and the Court of Appeals in certain cases, such concurrence does not allow an unrestricted freedom

of choice of court forum.[15] Petitioners have not alleged sufficient ground why direct recourse to this Court should be allowed. Thus, we

reaffirm the established rule that this Court will not entertain a direct appeal unless the redress desired cannot be obtained in the appropriate

courts, and exceptional and compelling circumstances justify the resort to the extraordinary remedy of writ of certiorari.[16]

WHEREFORE, the petition is DISMISSED for insufficiency of form and substance. The assailed Joint Decision dated July 15, 2005 of the

Regional Trial Court, Branch 170, City of Malabon, is AFFIRMED. No costs. SO ORDERED.
HEIRS OF CARLOS ALCARAZ, G.R. No. 131667

Petitioners,

- versus -
Promulgated:

July 28, 2005

REPUBLIC OF THE PHILIPPINES, BENJAMIN DAYOR and

ADELA ALCARAZ,

Respondents.

x------------------------------------------------------------------------------------x

DECISION

GARCIA, J.:

Assailed and sought to be set aside in this appeal by way of a petition for review on certiorari under Rule 45 of the Rules of Court

are the following issuances of the Court of Appeals in CA-G.R. CV No. 35570, to wit:

1. Decision dated 18 March 1997,[1] affirming an earlier decision of the Regional Trial Court, Branch 15, Malolos,
Bulacan insofar as it declared null and void ab initio petitioners Free Patent No. (III-6) 00075 and Original
Certificate of Title No. P-1887 but setting aside paragraphs 2 to 6 of the dispositive portion of said decision; and

2. Resolution dated 27 November 1997,[2] denying the separate motions for reconsideration filed by the parties.

The material facts, as found by the Court of Appeals, may be briefly stated, as follows:

Julian Alcaraz was the possessor and actual occupant of a parcel of land, identified as Lot No. 391, Cad-337, Meycauayan Cadastre,

with an area of 2,888 square meters, more or less, and situated at Barangay Bancal, Meycauayan, Bulacan. Upon his death on 13 April 1924,

his three (3) children namely, Carlos,Timotea and Igmedio, all surnamed Alcaraz, succeeded in the possession and occupation of said land

with each of them allocating to each other a one-third (1/3) portion thereof.

Carlos Alcaraz had four (4) children, namely Silvino, Isabel, Flaviana and Feliza. Timotea Alcaraz had only one (1) child named

Benito Dayor who had three (3) children, to wit: Benjamin, Leonila and Rosario, all surnamed Dayor. For his part, Igmedio Alcaraz had two

(2) children, Miguel and Cirila.

Although there was no Deed of Extra-Judicial Settlement or Partition of the property that was left by their deceased father Julian

Alcaraz, the heirs and their respective descendants nonetheless made a physical partition thereof among themselves by confining their

respective possessions and occupations of the property in three (3) separate clusters distinguishing their respective origins from the

possessions of their ascendants, Carlos, Timotea and Igmedio. The heirs of Carlos Alcaraz had grouped themselves on the southern portion

of the land, while the heirs of Timotea Alcaraz had settled on the western portion. The northern portion was occupied by the heirs of

Igmedio Alcaraz.

On 2 February 1974, Maria Paz Alcaraz-Gomez, representing the heirs of Carlos Alcaraz, filed with the Bureau of Lands, District Land

Office No. III-6 at Tabang, Guiguinto, Bulacan, Free Patent Application No. (III-6) 933, Entry No. 000705 covering the entire subject parcel of

land.

Thereafter, or on 28 February 1974, Geodetic Engineer Luis E. Balicanta, land inspector of the said District Land Office, conducted

an investigation and ocular inspection of the subject land. After the requisite investigation and verification, District Land Officer Jesus B.

Toledo, for and by authority of the Director of Lands, issued on 22 April 1974 an Order of Approval of Application and Issuance of Patent Free

Patent No. (III-6) 000705. On even date, he sent a letter-request to the Register of Deeds of Bulacan to issue the corresponding certificate of

title for Free Patent (III-6) 000705, in the name of the heirs of Carlos Alcaraz.
 Pursuant thereto, the Register of Deeds issued on 7 May 1974 Original Certificate of Title (OCT) No. 1887 covering Free Patent No.

(III-6) 000705 in the name of the heirs of Carlos Alcaraz.

After some time, a formal protest was filed in the same District Land Office by the heirs of Timotea Alcaraz and Igmedio Alcaraz,

respectively represented by Benjamin Dayor and Adela Alcaraz-Evea. Not long thereafter, the protesting heirs amended their formal protest

by assailing the validity of the free patent issued in the name of the heirs of Carlos Alcaraz and alleging that the same was obtained thru

fraudulent acts and misrepresentation.

Thereupon, a formal investigation and ocular inspection was conducted by a land investigator of the District Land Office. In his

report, the land investigator recommended the recall and nullification of Free Patent No. (III-6) 000705 and the execution of appropriate

steps to restore the rights of the heirs of Timotea Alcaraz and Igmedio Alcaraz over the subject parcel of land and grant them preferential

rights to apply for the registration of the same in their names.

Then, on 30 July 1987, in the Regional Trial Court at Malolos, Bulacan the Republic of the Philippines, represented by the Solicitor General,

filed against the heirs of Carlos Alcaraz a complaint for annulment and cancellation of Free Patent No. (III-6) 000705 and OCT No. P-1887 and

the reversion of the same land to the public domain on the ground that fraud and misrepresentation attended the acquisition of said free

patent and title. The complaint, docketed as Civil Case No. 382-M-87, was raffled to Branch 15 of the court.

In their answer, the heirs of Carlos Alcaraz denied the material allegations of the complaint, averring that they have complied with

all the requirements for the issuance of a free patent and have not committed any fraud or misrepresentation in their application.

On 21 January 1988, the heirs of Timotea Alcaraz and Igmedio Alcaraz filed a motion for intervention. Their motion having been

granted by the trial court on 3 March 1988, they thereafter filed their complaint-in-intervention, therein maintaining that they and the heirs of

Carlos Alcaraz are co-owners of the land in question, hence the latter heirs own only one-third (1/3) thereof, with the remaining two-thirds

(2/3) belonging to them. They thus prayed for the cancellation of the free patent and the corresponding OCT issued to the heirs of Carlos

Alcaraz over the entire parcel for being null and void, and that they be declared co-owners thereof and the land itself ordered partitioned into

three (3) lots with each set of heirs allotted a one-third (1/3) portion thereof.

After due proceedings, the trial court, in a decision dated 9 October 1991, ordered the cancellation of the free patent and title of the heirs of

Carlos Alcaraz; recognized the intervenors co-ownership rights over the same property; and decreed the subdivision thereof. In full, the

decision dispositively reads:

WHEREFORE, in view of the foregoing, judgment is rendered by preponderance of evidence:

1) Declaring Free Patent No. (III-6) 000705 and the corresponding OCT No. P-1887 issued by
the Register of Deeds of Bulacan in the name of the heirs of Carlos Alcaraz as null and void ab initio;

2) Ordering defendants heirs of Carlos Alcaraz to surrender the owners duplicate copy of OCT
No. P-1887 to defendant Register of Deeds of Bulacan and directing the Registrar to cancel the same as well as the original
thereof, and all other certificate of title issued in lieu thereof;

3) Declaring the heirs of Timotea Alcaraz and heirs of Igmedio Alcaraz, represented by the
intervenors Benjamin Dayor and Adela Alcaraz, respectively, as co-owners of one-third (1/3) portion each over the parcel
of residential land in question;

4) Ordering the Municipal Assessor of the Municipality of Meycauayan, Province of Bulacan, to

cancel the tax declaration covering the parcel of land in question and in lieu thereof a new tax declaration be issued in the
names of the (1) Heirs of Carlos Alcaraz, (2) Heirs of Timotea Alcaraz and (3) Heirs of Igmedio Alcaraz as co-owners over
one-third (1/3) a piece of the land under controversy;

5) Ordering the Heirs of Carlos, Timotea and Igmedio, all surnamed Alcaraz, to cause the
subdivision of the land in litigation by a licensed Geodetic Engineer into three (3) lots, with a pathway in the middle from
the lot of the Heirs of Timotea Alcaraz through the Barrio Road of Bancal, Meycauayan, Bulacan, the expense to be
shouldered by them equally, to be used as Right of Way of occupants thereto; and
6) Ordering the defendants to pay costs of suit and attorneys fee of intervenors in the sum
of P5,000.00.

SO ORDERED.

Unable to accept the judgment, petitioners went to the Court of Appeals via ordinary appeal under Rule 41 of the Rules of Court,

which appeal was thereat docketed as CA-G.R. CV No. 35570.

As stated at the outset hereof, the appellate court, in a decision dated 18 March 1997, [3] affirmed with modification that of the trial

court, thus:
 WHEREFORE, the appealed decision dated October 9, 1991, of the court a quo is hereby AFFIRMED insofar as it

declared null and void ab initio Free Patent No. (III-6) 000705 and Original Certificate of Title No. P-1887 issued by the

Register of Deeds for the Province of Bulacan, in the names of the Heirs of Carlos Alcaraz. Paragraphs 2 to 6 of the

dispositive portion of the aforesaid decision is (sic) SET ASIDE and a new one is rendered as follows:

1. Ordering that the land covered by Free Patent No. (III-6) 000705 and Original Certificate of

Title No. P-1887 be reverted to the mass of the public domain; and

2. Ordering appellants and intervenors to pay the cost of suit.

SO ORDERED.

In time, all the three (3) sets of heirs filed their respective motions for reconsideration, all of which were denied by the appellate

court in its resolution of 27 November 1997.[4]

From there, only the herein petitioners Heirs of Carlos Alcaraz came to this Court thru the present recourse, commending for our

resolution the following issues:

I.

WHETHER OR NOT FRAUD OR MISREPRESENTATION HAD BEEN COMMITTED BY THE PETITIONERS IN THEIR APPLICATION

FOR FREE PATENT IN CONTEMPLATION OF SECTION 91 OF C.A. NO. 141, AS AMENDED.

II.

WHETHER OR NOT FREE PATENT NO. (III-6) 000705 AND ORIGINAL CERTIFICATE OF TITLE NO. P-1887 WERE LEGALLY

AND VALIDLY ISSUED AND REGISTERED IN THE NAME OF THE PETITIONERS, HEIRS OF CARLOS ALCARAZ.

III.

WHETHER OR NOT ORIGINAL CERTIFICATE OF TITLE NO. P-1887 ISSUED BY THE REGISTER OF DEEDS FOR THE

PROVINCE OF BULACAN COVERING FREE PATENT NO. (III-6) 000705 HAD BECOME INDEFEASIBLE AND CONCLUSIVE OF

THE PETITIONERS TITLE OVER THE SUBJECT LAND.

IV.

WHETHER OR NOT THE ACTION TAKEN BY PRIVATE RESPONDENTS CONSTITUTES A COLLATERAL ATTACK ON ORIGINAL

CERTIFICATE OF TITLE NO. P-1887.

V.

WHETHER OR NOT COURT A QUO MAY CONVERT THE ORIGINAL ACTION FOR REVERSION FILED BY RESPONDENT

REPUBLIC OF THE PHILIPPINES INTO AN ACTION FOR RECONVEYANCE, A SPECIAL PROCEEDINGS FOR SETTLEMENT OF

ESTATE OF DECEASED PERSONS AND A SPECIAL CIVIL ACTION FOR PARTITION.

VI.

WHETHER OR NOT THE COURT OF APPEALS CAN MODIFY THE DECISION OF THE REGIONAL TRIAL COURT BY ORDERING

THE REVERSION OF THE LAND COVERED BY FREE PATENT NO. (III-6) 000705 AND ORIGINAL CERTIFICATE OF TITLE NO.
 P-1887 TO THE MASS OF PUBLIC DOMAIN DESPITE THE FAILURE OF BOTH PUBLIC AND PRIVATE RESPONDENTS

(PLAINTIFFS) TO APPEAL SAID DECISION.

We DENY.

As it is, the first and second issues tendered by the petitioners call for a reexamination and reevaluation of the factual findings of

the two (2) courts below that fraud and misrepresentation characterized their free patent application when their representative Maria Paz

Alcaraz-Gomez failed to disclose thereunder that other persons, no less the heirs of Timotea and Igmedio, were occupying portions of the land

subject thereof.

The task required of us by the petitioners cannot be done, consistent with our repeated holdings that this Court is not a trier of facts

and that only questions of law may be raised in a petition for review on certiorari under Rule 45. We have made this clear in a long line of

decisions.[5] In fact, in Aclon vs. Court of Appeals,[6] we even said:

It is settled that as a rule, the findings of fact of the Court of Appeals especially those affirming the trial court are

final and conclusive and cannot be reviewed on appeal to the Supreme Court.

Sure, the rule which precludes review by this Court of the factual findings of lower courts admits of exceptions. In Insular Life

Assurance Company, Ltd. vs. Court of Appeals,[7] we enumerated those exceptions:

[i]t is a settled rule that in the exercise of the Supreme Courts power of review, the Court is not a trier of facts and does
not normally undertake the re-examination of the evidence presented by the contending parties during the trial of the case
considering that the findings of facts of the CA are conclusive and binding on the Court. However, the Court had recognized
several exceptions to this rule, to wit: (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 Court of Appeals 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 petitioners 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; and (11) when the Court of
Appeals manifestly overlooked certain relevant facts not disputed by the parties, which, if properly considered, would
justify a different conclusion.

Unfortunately for the petitioners, however, our own careful study of the case yields none of the above circumstances which may

warrant our reevaluation of the factual findings of both the trial and the appellate courts.

Significantly, the presence of the heirs of Timotea and Igmedio on the land in question at the time petitioners filed their free patent

application was in fact acknowledged by them in this petition (at p. 15 thereof), albeit saying that their occupation of portions thereof was

merely tolerated.

In this connection, Section 91 of Commonwealth Act No. 141, as amended, provides:

The statements made in the application shall be considered as essential conditions and parts of any concession,

title, or permit issued on the basis of such application, and any false statement therein or omission of facts altering,

changing, or modifying the considerations of the facts set forth in such statements, and any subsequent modification,

alteration, or change of material facts set forth in the application shall ipso facto produce the cancellation of the

concession, title, or permit granted. (Italics supplied.)

Doubtless, petitioners failure to state in their free patent application that private respondents, as representatives of the heirs of

Timotea and Igmedio, are also in possession of the land subject thereof clearly constitutes a concealment of a material fact amounting to

fraud and misrepresentation within the context of the aforequoted provision, sufficient enough to cause ipso facto the cancellation of their
patent and title. For sure, had only petitioners made such a disclosure, the Director of Lands would have had second thoughts in directing the

issuance of petitioners patent and title.

With the recognition of the fact that petitioners free patent application was attended with fraud and misrepresentation, the trial

court and the Court of Appeals correctly applied the law when they declared the nullity of petitioners Free Patent No. (III-6) 000705 and the

title issued pursuant thereto, and directed the cancellation of the same.

Prescinding from the premise that no defect vitiates their application, petitioners next contend that their patent and title had thereby

become indefeasible and conclusive, and that the land therein covered no longer subject to reversion.

Because the premise is wrong, so must the conclusion be.

Jurisprudence is unambiguous on this point. In the words of Bagiuo vs. Republic, et al.:[8]

It is true that, once a patent is registered and the corresponding certificate of title is issued, the land covered by

them ceases to be part of the public domain and becomes private property, and the Torrens Title issued pursuant to the

patent becomes indefeasible upon the expiration of one year from the date of issuance of such patent. However, as held

in Director of Lands v. De Luna, even after the lapse of one year, the State may still bring an action under 101 of

Commonwealth Act No. 141 for the reversion to the public domain of land which has been fraudulently granted to private

individuals. Such action is not barred by prescription, and this is settled law.

Indeed, the indefeasibility of a certificate of title cannot be invoked by one who procured the title by means of

fraud. Public policy demands that one who obtains title to public land through fraud should not be allowed to benefit

therefrom. (Underscoring supplied)

Running in parallel vein is our holding in Director of Lands vs. Abanilla and The Register of Deeds of Isabela,[9] to wit:

The doctrine in Heirs of Carle, Sumail, and other cases cited by the appellant regarding the indefeasibility of title

issued pursuant to a free patent one year after its issuance does not apply to a grant tainted with fraud and secured

through misrepresentation, such as the free patent invoked in this case, since said grant is null and avoid and of no effect

whatsoever.

In fine, it is settled that a title emanating from a free patent which was secured through fraud and misrepresentation does not

become indefeasible, precisely because the patent from whence the title sprung is itself void and of no effect whatsoever.

Petitioners next argue that the complaint filed by the Office of the Solicitor General in this case is a collateral attack on their OCT No.

P-1887, which is impermissible.

True it is that in Henderson vs. Garrido and The Register of Deeds,[10] this Court has made it clear that a Torrens title cannot be

collaterally attacked and may only be challenged in a direct proceeding brought for that purpose:

It is well known principle that a Torrens Title is irrevocable and indefeasible. It cannot be collaterally attacked. It

can only be challenged in a direct proceeding.

The rule on indefeasibility of title, however, finds no application herein for the simple reason that the title involved in this case

cannot attain indefeasibility on account of petitioners concealment of a material fact in their free patent application.
 Anent the fifth issue, it is petitioners submission that it was error on the part of the trial court to have converted the original action

for reversion filed by respondent Republic into an action for reconveyance. For sure, in their Memorandum,[11] petitioners agreed with that

portion of the Court of Appeals decision holding that the trial court cannot convert the action for reversion into an action for reconveyance. In

the same breath, however, they took issue and opposed the appellate courts suggestion that herein private respondents may later on file

their respective public land application after Free Patent No. (III-6) 000705 and Original Certificate of Title No. P-1887 had been annulled or

cancelled.

We find nothing wrong with said suggestion by the Court of Appeals, which merely expressed the only logical and legal consequence

(which constitutes therein intervenors remedy under the law), resulting from the factual conclusion (that the land in question remained to be

part of the public domain because of the defect in appellants free patent application), which was arrived at by said appellate court. To put this

issue in the right context, we quote the exact words of said court in the decision under review:

Not being the owners of the land in dispute, intervenors can not ask for the reconveyance of the property to

them. Intervenors remedy is to file their respective public land applications with the Bureau of Lands, after the Original

Certificate of Title No. P-1887 in the name of appellants had been cancelled by the Register of Deeds for the province of

Bulacan, and the land had been reverted to the public domain.[12]

By expressing the foregoing suggestion, the Court of Appeals did not make any declaration or adjudicate on the contending rights of

the parties. Verily, it has not granted ownership rights in favor of the intervenors but merely confirmed the fact that, since the land in

question is still public land, the procedure laid down by law for acquisition of title over such public land must be followed.

Coming now to the sixth and final issue, it is petitioners posture that the appellate court cannot modify the decision of the trial court by

ordering the reversion of the subject land to the mass of public domain because neither the Republic nor the private respondents took an

appeal from the decision of the trial court.

We are not persuaded.

This is no novel issue for this Court. In Sangalang vs. Intermediate Appellate Court,[13] this Court addressed this matter squarely:

The first question represents an attack on the appellate court's reliance on Ordinances Nos. 81 and 81-01, a
matter not supposedly taken up at the trial or assigned as an error on appeal. As a rule, the Court of Appeals (then the
Intermediate Appellate Court) may determine only such questions as have been properly raised to it, yet, this is not an
inflexible rule of procedure. InHernandez v. Andal, it was stated that an unassigned error closely related to an error
properly assigned, or upon which the determination of the question raised by the error properly assigned is
dependent, will be considered by the appellate court notwithstanding the failure to assign it as
error. In Baquiran v. Court of Appeals, we referred to the modern trend of procedure . . . accord[ing] the courts broad
discretionary power, and in which we allowed consideration of matters having some bearing on the issue submitted which
the parties failed to raise or the lower court ignore[d]. And in Vda. de Javellana v. Court of Appeals, we permitted the
consideration of a patent error of the trial court by the Court of Appeals under Section 7 (now Section 8), of
Rule 51, of the Rules of Court,[14] although such an error had not been raised in the brief. (Emphasis supplied.)

There is no question that petitioners raised the issue on the validity of OCT No. P-1887 before the Court of Appeals. Necessarily

connected with said issue is the issue of reversion, because the ultimate legal consequence of any declaration of nullity of a decree of

registration and its corresponding OCT, is none other than reversion of subject parcel of land to the mass of public domain. There is no doubt

whatsoever that such reversion is inevitably related to the issue of the validity of OCT No. P-1887, duly raised before the Court of Appeals.
In any event, when petitioners interposed an appeal to the Court of Appeals, the appealed case was thereby thrown wide open for

review by that court, which is thus necessarily empowered to come out with a judgment as it thinks would be a just determination of the

controversy. Given this power, the appellate court has the authority to either affirm, reverse or modify the appealed decision of the trial

court. To withhold from the appellate court its power to render an entirely new decision would violate its power of review and would, in effect,

render it incapable of correcting patent errors committed by the lower courts. WHEREFORE, the instant petition is DENIED and the herein

assailed decision and resolution of the Court of Appeals AFFIRMED in toto. Costs against petitioners. SO ORDERED.
 [G.R. No. 127920. August 9, 2005]

EMILIO B. PACIOLES, JR., IN HIS CAPACITY AS ADMINISTRATOR AND HEIR OF THE INTESTATE ESTATE OF MIGUELITA CHING-
PACIOLES,petitioner, vs. MIGUELA CHUATOCO-CHING, respondent.

DECISION

SANDOVAL-GUTIERREZ, J.:

Oftentimes death brings peace only to the person who dies but not to the people he leaves behind. For in death, a persons estate
remains, providing a fertile ground for discords that break the familial bonds. Before us is another case that illustrates such reality. Here, a
husband and a mother of the deceased are locked in an acrimonious dispute over the estate of their loved one.

This is a petition for review on certiorari filed by Emilio B. Pacioles, Jr., herein petitioner, against Miguela Chuatoco-Ching, herein
respondent, assailing the Court of Appeals Decision[1]dated September 25, 1996 and Resolution[2] dated January 27, 1997 in CA-G.R. SP No.
41571.[3] The Appellate Court affirmed the Order dated January 17, 1996 of the Regional Trial Court (RTC), Branch 99, Quezon
City denying petitioners motion for partition and distribution of the estate of his wife, Miguelita Ching-Pacioles; and his motion for
reconsideration.

The facts are undisputed.

On March 13, 1992, Miguelita died intestate, leaving real properties with an estimated value of P10.5 million, stock investments
worth P518,783.00, bank deposits amounting to P6.54 million, and interests in certain businesses. She was survived by her husband,
petitioner herein, and their two minor children.

Consequently, on August 20, 1992, petitioner filed with the RTC a verified petition [4] for the settlement of Miguelitas estate. He prayed
that (a) letters of administration be issued in his name, and (b) that the net residue of the estate be divided among the compulsory heirs.

Miguelitas mother, Miguela Chuatoco-Ching, herein respondent, filed an opposition, specifically to petitioners prayer for the issuance of
letters of administration on the grounds that (a)petitioner is incompetent and unfit to exercise the duties of an administrator; and (b) the
bulk of Miguelitas estate is composed of paraphernal properties. Respondent prayed that the letters of administration be issued to her
instead.[5] Afterwards, she also filed a motion for her appointment as special administratrix.[6]

Petitioner moved to strike out respondents opposition, alleging that the latter has no direct and material interest in the estate, she not
being a compulsory heir, and that he, being the surviving spouse, has the preferential right to be appointed as administrator under the law. [7]

Respondent countered that she has direct and material interest in the estate because she gave half of her inherited properties to
Miguelita on condition that both of them would undertake whatever business endeavor they decided to, in the capacity of business
partners.[8]

In her omnibus motion[9] dated April 23, 1993, respondent nominated her son Emmanuel Ching to act as special administrator.

On April 20, 1994, the intestate court issued an order appointing petitioner and Emmanuel as joint regular administrators of the
estate.[10] Both were issued letters of administration after taking their oath and posting the requisite bond.

Consequently, Notice to Creditors was published in the issues of the Manila Standard on September 12, 19, and 26, 1994. However, no
claims were filed against the estate within the period set by the Revised Rules of Court.

Thereafter, petitioner submitted to the intestate court an inventory of Miguelitas estate.[11] Emmanuel did not submit an inventory.

On May 17, 1995, the intestate court declared petitioner and his two minor children as the only compulsory heirs of Miguelita.[12]

On July 21, 1995, petitioner filed with the intestate court an omnibus motion [13] praying, among others, that an Order be issued
directing the: 1) payment of estate taxes; 2) partition and distribution of the estate among the declared heirs; and 3) payment of
attorneys fees.

Respondent opposed petitioners motion on the ground that the partition and distribution of the estate is premature and precipitate,
considering that there is yet no determination whether the properties specified in the inventory are conjugal, paraphernal or owned in a joint
venture.[14] Respondent claimed that she owns the bulk of Miguelitas estate as an heir and co-owner. Thus, she prayed that a
hearing be scheduled.

On January 17, 1996, the intestate court allowed the payment of the estate taxes and attorneys fees but denied petitioners
prayer for partition and distribution of the estate, holding that it is indeed premature. The intestate court ratiocinated as follows:

On the partition and distribution of the deceaseds properties, among the declared heirs, the Court finds the prayer of petitioner in this regard
to be premature. Thus, a hearing on oppositors claim as indicated in her opposition to the instant petition is necessary to determine whether
the properties listed in the amended complaint filed by petitioner are entirely conjugal or the paraphernal properties of the
deceased, or a co-ownership between the oppositor and the petitioner in their partnership venture.

Petitioner filed a motion for reconsideration but it was denied in the Resolution dated May 7, 1996.

Forthwith, petitioner filed with the Court of Appeals a petition for certiorari seeking to annul and set aside the intestate courts Order
dated January 17, 1996 and Resolution dated May 7, 1996 which denied petitioners prayer for partition and distribution of the estate for being
premature, indicating that it (intestate court) will first resolve respondents claim of ownership.

The Appellate Court dismissed the petition for certiorari, holding that in issuing the challenged Order and Resolution, the intestate court
did not commit grave abuse of discretion.

The Appellate Court ruled:

Regarding the second issue raised, respondent judge did not commit grave abuse of discretion in entertaining private respondents
unsupported claim of ownership against the estate. In fact, there is no indication that the probate court has already made a finding of title or
ownership. It is inevitable that in probate proceedings, questions of collation or of advancement are involved for these are matters which can
be passed upon in the course of the proceedings. The probate court in exercising its prerogative to schedule a hearing, to inquire into the
propriety of private respondents claim, is being extremely cautious in determining the composition of the estate. This act is not tainted with
an iota of grave abuse of discretion.

Petitioner moved for a reconsideration but it was likewise denied. Hence, this petition for review on certiorari anchored on the following
assignments of error:

RESPONDENT COURTS DECISION WHICH AFFIRMS THE INTESTATE COURTS ORDER IS A GRAVE ERROR FOR BEING CONTRARY TO THE
SETTLED JURISPRUDENCE AND POLICY OF THE LAW THAT ESTATE PROCEEDINGS MUST BE SETTLED EXPEDITIOUSLY.
 II

RESPONDENT COURT COMMITTED GRAVE ERROR IN SUSTAINING THE INTESTATE COURTS ORDER TO CONDUCT HEARING ON THE ISSUE OF
OWNERSHIP CLAIM AGAINST THE ESTATE, AS SAID FUNCTION IS OUTSIDE AND BEYOND THE JURISDICTION OF THE INTESTATE COURT.

III

RESPONDENT COURT GRAVELY ERRED IN AFFIRMING THE INTESTATE COURTS ORDER AND RESOLUTION NOTWITHSTANDING THAT
RESPONDENT CHINGS OWNERSHIP CLAIMS ARE CONFLICTING, FRIVOLOUS AND BASELESS.

The fundamental issue for our resolution is: May a trial court, acting as an intestate court, hear and pass upon questions of ownership
involving properties claimed to be part of the decedents estate?

The general rule is that the jurisdiction of the trial court either as an intestate or a probate court relates only to matters having to do
with the settlement of the estate and probate of will of deceased persons but does not extend to the determination of questions of
ownership that arise during the proceedings.[15] The patent rationale for this rule is that such court exercises special and limited
jurisdiction.[16]

A well-recognized deviation to the rule is the principle that an intestate or a probate court may hear and pass upon questions of
ownership when its purpose is to determine whether or not a property should be included in the inventory. In such situations the adjudication
is merely incidental and provisional. Thus, in Pastor, Jr. vs. Court of Appeals,[17] we held:

x x x As a rule, the question of ownership is an extraneous matter which the probate court cannot resolve with finality. Thus, for the
purpose of determining whether a certain property should or should not be included in the inventory of estate properties, the
probate court may pass upon the title thereto, but such determination is provisional, not conclusive, and is subject to the final
decision in a separate action to resolve title.

The Court of Appeals relied heavily on the above principle in sustaining the jurisdiction of the intestate court to conduct a hearing on
respondents claim. Such reliance is misplaced. Under the said principle, the key consideration is that the purpose of the intestate or
probate court in hearing and passing upon questions of ownership is merely to determine whether or not a property should be
included in the inventory. The facts of this case show that such was not the purpose of the intestate court.

First, the inventory was not disputed. In fact, in her Manifestation and Opposition [18] dated September 18, 1995, respondent expressly
adopted the inventory prepared by petitioner, thus:

6. She adopts the inventory submitted by the petitioner in his Amended Compliance dated October 6, 1994, and filed only on
November 4, 1994 not October 5, 1995 as erroneously asserted in Par. 12 of the Omnibus Motion. Oppositor, however, takes exception to the
low valuation placed on the real estate properties and reserves her right to submit a more accurate and realistic pricing on each.

Respondent could have opposed petitioners inventory and sought the exclusion of the specific properties which she believed or
considered to be hers. But instead of doing so, she expressly adopted the inventory, taking exception only to the low valuation placed on
the real estate properties.

And second, Emmanuel, respondents son and representative in the settlement of Miguelitas estate, did not submit his own inventory.
His mandate, as co-administrator, is to submit within three (3) months after his appointment a true inventory and appraisal of all the real and
personal estate of the deceased which have come into his possession or knowledge.[19] He could have submitted an inventory, excluding
therefrom those properties which respondent considered to be hers. The fact that he did not endeavor to submit one shows
that he acquiesced with petitioners inventory.

Obviously, respondents purpose here was not to obtain from the intestate court a ruling of what properties should or should not be
included in the inventory. She wanted something else, i.e., to secure from the intestate court a final determination of her claim of
ownership over properties comprising the bulk of Miguelitas estate. The intestate court went along with respondent on this point as
evident in its Resolution[20] dated May 7, 1996, thus:

On petitioners motion for partition and distribution of the estate of the late Miguelita Ching Pacioles, it is believed that since oppositor had
interposed a claim against the subject estate, the distribution thereof in favor of the heirs could not possibly be implemented as there is still a
need for appropriate proceedings to determine the propriety of oppositors claim. It must be mentioned that if it is true that oppositor owns
the bulk of the properties, which she allegedly placed/registered in the name of the deceased for convenience, Oppositor, therefore, has a
material and direct interest in the estate and hence, should be given her day in Court.

It is apparent from the foregoing Resolution that the purpose of the hearing set by the intestate court was actually to determine the
propriety of oppositors (respondents) claim. According to the intestate court, if it is true that the oppositor (respondent) owns the
bulk of (Miguelitas) properties, then it means that she has a material and direct interest in the estate and, hence, she should be
given her day in court. The intended day in court or hearing is geared towards resolving the propriety of respondents contention that she is
the true owner of the bulk of Miguelitas estate.

Surely, we cannot be deluded by respondents ingenious attempt to secure a proceeding for the purpose of resolving her blanket claim
against Miguelitas estate. Although, she made it appear that her only intent was to determine the accuracy of petitioners inventory, however,
a close review of the facts and the pleadings reveals her real intention.

Clearly, the RTC, acting as an intestate court, had overstepped its jurisdiction. Its proper course should have been to maintain a hands-
off stance on the matter. It is well-settled in this jurisdiction, sanctioned and reiterated in a long line of decisions, that when a question arises
as to ownership of property alleged to be a part of the estate of the deceased person, but claimed by some other person to be his property,
not by virtue of any right of inheritance from the deceased but by title adverse to that of the deceased and his estate, such question cannot
be determined in the course of an intestate or probate proceedings. The intestate or probate court has no jurisdiction to adjudicate
such contentions, which must be submitted to the court in the exercise of its general jurisdiction as a regional trial
court.[21] Jurisprudence teaches us that:

[A] probate court or one in charge of proceedings whether testate or intestate cannot adjudicate or determine title to
properties claimed to be a part of the estate and which are claimed to belong to outside parties. All that the said court could do as
regards said properties is to determine whether they should or should not be included in the inventory or list of properties to be administered
by the administrator. If there is no dispute, well and good, but if there is, then the parties, the administrator, and the opposing
parties have to resort to an ordinary action for a final determination of the conflicting claims of title because the probate court
cannot do so.[22]

Hence, respondents recourse is to file a separate action with a court of general jurisdiction. The intestate court is not the appropriate
forum for the resolution of her adverse claim of ownership over properties ostensibly belonging to Miguelita's estate.

Now, even assuming that the intestate court merely intended to make a provisional or prima facie determination of the issue of
ownership, still respondents claim cannot prosper. It bears stressing that the bulk of Miguelitas estate, as stated in petitioners inventory,
comprises real estates covered by the Torrens System which are registered either in the name of Miguelita alone or with petitioner. As such,
they are considered the owners of the properties until their title is nullified or modified in an appropriate ordinary action. We
find this Courts pronouncement in Bolisay vs. Alcid[23] relevant, thus:

It does not matter that respondent-administratrix has evidence purporting to support her claim of ownership, for, on the other hand,
petitioners have a Torrens title in their favor, which under the law is endowed with incontestability until after it has been set aside in the
manner indicated in the law itself, which, of course, does not include, bringing up the matter as a mere incident in special
proceedings for the settlement of the estate of deceased persons. x x x

x x x In regard to such incident of inclusion or exclusion, We hold that if a property covered by Torrens Title is involved, the presumptive
conclusiveness of such title should be given due weight, and in the absence of strong compelling evidence to the contrary, the holder
thereof should be considered as the owner of the property in controversy until his title is nullified or modified in an appropriate
ordinary action, particularly, when as in the case at bar, possession of the property itself is in the persons named in the title. x
xx

Corrolarily, P.D. 1529, otherwise known as, The Property Registration Decree, proscribes collateral attack against Torrens Title, hence:

Section 48. Certificate not subject to collateral attack.

A certificate of title shall not be subject to collateral attack. It cannot be altered, modified or cancelled except in a direct
proceeding in accordance with law.

Significantly, a perusal of the records reveals that respondent failed to present convincing evidence to bolster her bare assertion of
ownership. We quote her testimony, thus:

Q: I now direct your attention to paragraph (5) appearing on page 1 of this sworn statement of yours which I quote: In
accordance with the Chinese tradition and culture in the distribution of properties to the legal heirs, we decided to give only
a token to our daughter Miguelita and leave the rest to our only son Emmanuel, with the undertaking that being the son he
will take full responsibility of the rest of the family despite his marriage. Madame witness, do you recall having stated that in
your sworn statement?

A: Yes sir, but it was not carried out.

Q What was actually given to your daughter Miguelita is only a token, is that right?

A: Not a token, sir, but one half of the share of the estate was given to Lita and the other half was given to Emmanuel.

Q: What went to Emmanuel was also , is that right?

A: Yes, sir.

Q: What makes up the one half share of Lita, if you recall?

A: What was given to her were all checks, sir, but I cannot remember any more the amount.

xxxxxx

Q: Summing up your testimony, Madame, you cannot itemize the one half share of the estate of Miguelita, is that
right?

A: Yes, sir.

Q: Was there any document covering this partition of the estate among you, Emmanuel and Miguelita with respect to
the estate of your late husband?

A: If I only knew that this will happen

Q: Samakatuwid po ay walang dokumento?

A: Wala po.[24]

She further testified as follows:

Q: Among the properties listed like the various parcels of land, stocks, investments, bank accounts and deposits both
here and abroad, interests and participation in IFS Pharmaceuticals and Medical Supplies, Inc. and various
motor vehicles, per your pleasure, Madam Witness, how should these properties be partitioned or what should
be done with these properties? According to you earlier, you are agreeable for the partition of the said
properties with Emil on a 50-50 basis, is that right?

A: Kung ano po ang sa akin, iyon ang dapat na bumalik sa akin, sir.

Q Halimbawa ay ano po iyon? Real estate properties, parcels of land located in Pag-Asa, in Silangan, in San Lazaro, in
Sta. Cruz, in San Francisco del Monte and shares of stock. Alinsunod sa inyo, paano po ang dapat na partihan o
hatian ninyo ni Emil?

A: Kung ano ang sa akin

xxxxxx

Q Ang tanong ko po sa inyo ay ganito, ito po ba ang inyong iminungkahi kay Emil? Ito po ba ang inyong paghahatian
or hindi?

A: Iyo akin talaga na hindi nila pinaghirapan, sir.[25]

Unfortunately, respondent could not even specify which of the properties listed in petitioners inventory belong to her. Neither could she
present any document to prove her claim of ownership. The consistently changing basis of her claim did nothing to improve her posture.
Initially, she insisted that the bulk of Miguelitas estate is composed of paraphernal properties.[26]Sensing that such assertion could not
strengthen her claim of ownership, she opted to change her submission and declare that she and Miguelita were business partners and that
she gave to the latter most of her properties to be used in a joint business venture.[27] Respondent must have realized early on that if the
properties listed in petitioners inventory are paraphernal, then Miguelita had the absolute title and ownership over them and upon her death,
such properties would be vested to her compulsory heirs, petitioner herein and their two minor children.[28]

At any rate, we must stress that our pronouncements herein cannot diminish or deprive respondent of whatever rights or properties she
believes or considers to be rightfully hers. We reiterate that the question of ownership of properties alleged to be part of the estate must be
submitted to the Regional Trial Court in the exercise of its general jurisdiction.[29] WHEREFORE, the instant petition is GRANTED. The
assailed Decision and Resolution of the Court of Appeals in CA-G.R. SP No. 41571 are hereby REVERSED. SO ORDERED.
 [G.R. No. 146823. August 9, 2005]

SPOUSES RAMON and ESTRELLA RAGUDO, petitioners, vs. FABELLA ESTATE TENANTS ASSOCIATION, INC., respondent.

DECISION

GARCIA, J.:

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 in CA-G.R. CV No. 51230, to wit:

1. Decision dated 19 July 2000,[1] affirming with modification an earlier decision of the Regional Trial Court at Pasig City, Branch 155,
in an action for recovery of possession thereat commenced by the herein respondent against the petitioners; and

2. Resolution dated 29 January 2001,[2] denying petitioners motion for reconsideration.

The facts may be briefly stated, as follows:

Earlier, the tenants of a parcel of land at Mandaluyong City with an area of 6,825 square meters (hereinafter referred to as the Fabella
Estate), which formed part of the estate of the late Don Dionisio M. Fabella, organized themselves and formed the Fabella Estate Tenants
Association, Inc. (FETA), for the purpose of acquiring said property and distributing it to its members.

Unable to raise the amount sufficient to buy the property from the heirs of Don Dionisio M. Fabella, FETA applied for a loan from the
National Home Mortgage Finance Corporation (NHMFC) under the latters Community Mortgage Program.

However, as a pre-condition for the loan, and in order that specific portions of the property could be allotted to each tenant who will
have to pay the corresponding price therefor, NHMFC required all tenants to become members of FETA.

Accordingly, all the tenants occupying portions of the Fabella Estate were asked to join FETA. While the rest did, the spouses Ramon
Ragudo and Estrella Ragudo who were occupying the lot subject matter of this controversy, consisting of about 105 square meters of the
Fabella Estate, refused to join the Association. Consequently, the portion occupied by them was awarded to Mrs. Miriam De Guzman, a
qualified FETA member.

Later, and with the help of the city government of Mandaluyong, FETA became the registered owner of the entire Fabella Estate, as
evidenced by Transfer Certificate of Title No. 2902 issued in its name by the Register of Deeds of Mandaluyong in 1989.

To effect the ejectment of the spouses Ragudo from the portion in question which they continued to occupy despite the earlier award
thereof to Mrs. Miriam de Guzman, FETA filed against them a complaint for unlawful detainer before the Metropolitan Trial Court (MeTC) of
Mandaluyong City.

In a decision dated 6 August 1990, the MeTC dismissed the unlawful detainer case on the ground that it was an improper remedy
because the Ragudos had been occupying the subject portion for more than one (1) year prior to the filing of the complaint, hence the proper
action should have been one for recovery of possession before the proper regional trial court. FETA appealed the dismissal to the Regional
Trial Court at Pasig City, which affirmed the same.

FETA then filed with the RTC-Pasig a complaint for recovery of possession against the Ragudos. In their Answer, the spouses interposed
the defense that they have already acquired ownership of the disputed portion since they have been in occupation thereof in the concept of
an owner for more than forty (40) years. They further argued that FETAs title over the entire Fabella Estate is fake because as appearing on
TCT No. 2902, it was originally registered as OCT No. 13, a title which has been previously adjudged null and void by RTC-Pasig in a much
earlier case involving different parties. Finally, they insist that FETAs right to recover has been barred by laches in view of their more than 40-
year occupancy of the portion in question.

Eventually, in a decision dated 29 July 1994,[3] the trial court rendered judgment in FETAs favor, thus:

WHEREFORE, premises considered, judgment is hereby rendered:

1) ordering [spouses Ragudo] to vacate the premises in question and to turn over possession thereof to [FETA];

2) to pay [FETA] rent in the amount of P500.00 for the month of November 1981 and every month thereafter until they vacate the premises;

3) to pay [FETA] attorneys fees in the amount of P20,000.00;

4) to pay [FETA] the amount of P50,000.00 as exemplary damages; and

5) to pay the costs of suit.

SO ORDERED.

Therefrom, the spouses Ragudo went on appeal to the Court of Appeals, whereat their appellate recourse was docketed as CA-G.R. CV
No. 51230.

Meanwhile, pending resolution by the appellate court of the Ragudos appeal, FETA filed with the trial court a motion for the issuance of
a writ of execution pending appeal, to which the Ragudos interposed an Opposition, followed by FETAs Reply to Opposition. Then, on 11
October 1994, the Ragudos filed with the trial court a Rejoinder to Reply With Counter-Motion to Admit Attached Documentary Evidence
Relevant to the Pending Incident.[4] Attached thereto and sought to be admitted therein were the following documents and photographs, to
wit:

1. Letter dated 21 November 1989[5] of the spouses Ragudos son, Engr. Aurelio Ragudo, addressed to FETA, stating therein that the
Ragudos were willing to become FETA members;

2. Joint Affidavit, dated 07 October 1994, of three (3) residents of the Fabella Estate; [6]

3. Photos of three (3) alleged houses of Miriam de Guzman located at the Fabella Estate;[7]

4. Photos of two (2) alleged houses of the sons of Miriam de Guzman located at the Fabella Estate; [8]
 5. Photo of a lot allegedly awarded by FETA to its president, Amparo Nobleza, located at the Fabella Estate; [9] and

6. Photo of a three (3)-storey house of Noblezas relative named Architect Fernandez located at the Fabella Estate. [10]

In an order dated 25 November 1994, the trial court admitted in evidence the attachments to the Ragudos' aforementioned Rejoinder
With Counter-Motion, etc., and ultimately denied FETAs motion for execution pending appeal.

Later, in CA-G.R. CV No. 51230, the Ragudos filed with the appellate court a Motion To Admit Certain Documentary Evidence by Way of
Partial New Trial, In the Interest of Justice,[11]thereunder seeking the admission in evidence of the very documents earlier admitted by the
trial court in connection with the then pending incident of execution pending appeal, and praying that said documents be made part of the
records and considered in the resolution of their appeal in CA-G.R. CV No. 51230.

This time, however, the Ragudos were not as lucky. For, in a Resolution dated 19 May 1997, [12] the appellate court denied their
aforesaid motion and ordered expunged from the records of the appealed case the documents they sought admission of, on the ground that
they could not be considered as newly discovered evidence under Rule 37 of the Rules of Court. Dispositively, the Resolution reads:

WHEREFORE, the instant motion to admit certain documentary evidence by way of partial new trial is DENIED for lack of merit.

ACCORDINGLY, the Joint Affidavit dated October 7, 1994 of Honesto Garcia III and Miguela L. Balbino and the latter of Aurelio Raguo to Atty.
Cesar G. Untalan dated November 21, 1989 are ordered EXPUNGED from the records of this case.

SO ORDERED.

The Ragudos moved for a reconsideration, invoking liberality in the exercise of judicial discretion and the interest of equity and
substantial justice. Unmoved, the appellate court denied their motion in its subsequent Resolution of 24 September 1997. [13]

Eventually, in the herein assailed decision dated 19 July 2000, the Court of Appeals dismissed the Ragudos appeal in CA-G.R. CV No.
51230 and affirmed with modification the RTC decision in the main case, thus:

WHEREFORE, premises considered, the appealed decision is hereby AFFIRMED, except for the second clause of the dispositive portion
which should be MODIFIED, as follows:

2) to pay [FETA] rent in the amount of P500.00 for the month of November, 1989 and every month thereafter until they vacate the premises.

SO ORDERED.

With their motion for reconsideration having been denied by the appellate court in its equally challenged Resolution of 29 January 2001,
the Ragudos are now with us via the instant recourse, commending for our resolution the following issues:

1. WHETHER OR NOT THE COURT OF APPEALS ERRED IN NOT ADMITTING IN EVIDENCE THE DOCUMENTS SOUGHT TO BE
INTRODUCED BY RAGUDO AT THE APPELLATE LEVEL ON THE GROUND OF LIBERALITY OF PROCEDURAL RULES, EQUITY AND
SUBSTANTIAL JUSTICE, THE MISTAKE AND EXCUSABLE NEGLIGENCE ON THE PART OF THEIR FORMER COUNSEL, AND THE
SOCIAL JUSTICE AND PARENS PATRIAE CLAUSE OF THE 1987 CONSTITUTION.

2. WHETHER OR NOT ACQUISITIVE PRESCRIPTION AND EQUITABLE LACHES HAD SET IN TO WARRANT THE CONTINUED POSSESSION
OF THE SUBJECT LOT BY RAGUDO AND WHETHER THE SAME PRINCIPLES HAD CREATED A VESTED RIGHT IN FAVOR OF RAGUDO
TO CONTINUE TO POSSESS AND OWN THE SUBJECT LOT.[14]

Informed of Mr. Ramon Ragudos death on 26 March 2001, the Court, in a resolution dated 14 January 2002,[15] allowed his substitution
by his other heirs.

The recourse must fall.

Relative to the first issue, it is petitioners submission that the appellate court committed an error when it refused admission as evidence
in the main case the documents earlier admitted by the trial court in connection with FETAs motion for execution pending appeal. Appealing to
this Courts sense of judicial discretion in the interest of equity and substantial justice, petitioners explain that the documents in question were
not presented and offered in evidence during the trial of the main case before the RTC due to the honest mistake and excusable negligence of
their former counsel, Atty. Celso A. Tabobo, Jr.

We are not persuaded.

In this jurisdiction, well-entrenched is the rule that the mistake and negligence of counsel to introduce, during the trial of a case, certain
pieces of evidence bind his client.[16] For sure, inAguila vs. Court of First Instance of Batangas,[17] we even ruled that the omitted evidence by
reason of counsels mistake or negligence, cannot be invoked as a ground for new trial:

On the effects of counsels acts upon his client, this Court has categorically declared:

It has been repeatedly enunciated that a client is bound by the action of his counsel in the conduct of a case and cannot be heard to complain
that the result might have been different had he proceeded differently. A client is bound by the mistakes of his lawyer. If such grounds were
to be admitted and reasons for reopening cases, there would never be an end to a suit so long as new counsel could be employed who could
allege and show that prior counsel had not been sufficiently diligent or experienced or learned. x x x Mistakes of attorneys as to the
competency of a witness, the sufficiency, relevancy or irrelevancy of certain evidence, the proper defense, or the burden of proof, x x
x failure to introduce certain evidence, to summon witnesses and to argue the case are not proper grounds for a new trial, unless the
incompetency of counsel is so great that his client is prejudiced and prevented from properly presenting his case. (Vol. 2, Moran, Comments
on the Rules of Court, pp. 218, 219-220, citing Rivero v. Santos, et al., 98 Phil. 500, 503-504; Isaac v. Mendoza, 89 Phil. 279; Montes v.
Court, 48 Phil. 64; People v. Manzanilla, 43 Phil. 167; U.S. v. Umali, 15 Phil. 33; see also People v. Ner, 28 SCRA 1151, 1164). In the 1988
case of Palanca v. American Food, etc. (24 SCRA 819, 828), this principle was reiterated. (Tesoro v. Court of Appeals, 54 SCRA 296, 304).
[Citations in the original; Emphasis supplied].

This is, as it should be, because a counsel has the implied authority to do all acts which are necessary or, at least, incidental to the
prosecution and management of the suit in behalf of his client. [18] And, any act performed by counsel within the scope of his general and
implied authority is, in the eyes of the law, regarded as the act of the client himself and consequently, the mistake or negligence of the clients
counsel may result in the rendition of an unfavorable judgment against him.[19]

A contrary rule would be inimical to the greater interest of dispensing justice. For, all that a losing party will do is to invoke the mistake
or negligence of his counsel as a ground for reversing or setting aside a judgment adverse to him, thereby putting no end to litigation. Again,
to quote from our decision in Aguila:
Now petitioner wants us to nullify all of the antecedent proceedings and recognize his earlier claims to the disputed property on the
justification that his counsel was grossly inept. Such a reason is hardly plausible as the petitioners new counsel should know. Otherwise, all
a defeated party would have to do to salvage his case is claim neglect or mistake on the part of his counsel as a ground for
reversing the adverse judgment. There would be no end to litigation if this were allowed as every shortcoming of counsel could
be the subject of challenge by his client through another counsel who, if he is also found wanting, would likewise be disowned
by the same client through another counsel, and so on ad infinitum. This would render court proceedings indefinite, tentative and
subject to reopening at any time by the mere subterfuge of replacing counsel. (Emphasis supplied).

Admittedly, the rule thus stated admits of exceptions. Thus, in cases where the counsels mistake is so great and serious that the client
is prejudiced and denied his day in court[20] or when he is guilty of gross negligence resulting in the clients deprivation of his property without
due process of law,[21] the client is not bound by his counsels mistakes and the case may even be reopened in order to give the client another
chance to present his case.

Unfortunately, however, petitioners case does not fall under any of the exceptions but rather squarely within the ambit of the rule.

As it is, petitioners were given full opportunity during the trial of the main case to adduce any and all relevant evidence to advance their
cause. In no sense, therefore, may it be argued that they were denied due process of law. As we said in Antonio vs. Court of Appeals,[22] a
client cannot be said to have been deprived of his day in court and there is no denial of due process as long as he has been given an
opportunity to be heard, which, we emphasize, was done in the instant case.

Petitioners further argue that the documents which their former counsel failed to adduce in evidence during trial of the main case must
be allowed to stay in the records thereof and duly considered in the resolution of their appeal because they were duly admitted in the trial
court during the hearing on the incidental motion for execution pending appeal.

Again, we are not persuaded.

With the reality that those documents were never presented and formally offered during the trial of the main case, their belated
admission for purposes of having them duly considered in the resolution of CA-G.R. CV No. 51230 would certainly collide with Section 34,
Rule 132, of the Rules of Court, which reads:

SECTION 34. Offer of Evidence. The court shall consider no evidence which has not been formally offered. The purpose for which the
evidence is offered must be specified. (Emphasis supplied).

To stress, it was only during the hearing of the motion for execution pending appeal that said documents were presented and offered in
evidence. Sure, the trial court admitted them, but the admission was only for the purpose for which they were offered, that is, by way of
opposition to FETAs motion for execution pending appeal. It is basic in the law of evidence that the court shall consider evidence solely for the
purpose for which it was offered.[23]

While the said documents may have the right to stay in the records of the case for purposes of the incidental issue of execution pending
appeal, they do not have that same right insofar as far as the main case is concerned, and ought not be considered in the resolution thereof.

Petitioners next contend that acquisitive prescription and equitable laches had set in, thereby vesting them with a right to a continued
possession of the subject lot.

The contention holds no water.

It is not disputed that at the core of this controversy is a parcel of land registered under the Torrens system. In a long line of
cases,[24] we have consistently ruled that lands covered by a title cannot be acquired by prescription or adverse possession. So it is that
in Natalia Realty Corporation vs. Vallez, et al.,[25] we held that a claim of acquisitive prescription is baseless when the land involved is a
registered land because of Article 1126 of the Civil Code[26] in relation to Act 496 (now, Section 47 of Presidential Decree No. 1529[27]):

Appellants claim of acquisitive prescription is likewise baseless. Under Article 1126 of the Civil Code, prescription of ownership of
lands registered under the Land Registration Act shall be governed by special laws. Correlatively, Act No. 496 provides that no
title to registered land in derogation of that of the registered owner shall be acquired by adverse possession. Consequently, proof
of possession by the defendants is both immaterial and inconsequential. (Emphasis supplied).

Petitioners would take exception from the above settled rule by arguing that FETA as well as its predecessor in interest, Don Dionisio M.
Fabella, are guilty of laches and should, therefore, be already precluded from asserting their right as against them, invoking, in this regard,
the rulings of this Court[28] to the effect that while a registered land may not be acquired by prescription, yet, by virtue of the registered
owners inaction and neglect, his right to recover the possession thereof may have been converted into a stale demand.

While, at a blush, there is apparent merit in petitioners posture, a closer look at our jurisprudence negates their submission.

To start with, the lower court found that petitioners possession of the subject lot was merely at the tolerance of its former lawful owner.
In this connection, Bishop vs. Court of Appeals[29]teaches that if the claimants possession of the land is merely tolerated by its lawful owner,
the latters right to recover possession is never barred by laches:

As registered owners of the lots in question, the private respondents have a right to eject any person illegally occupying their property. This
right is imprescriptible. Even if it be supposed that they were aware of the petitioners occupation of the property, and regardless
of the length of that possession, the lawful owners have a right to demand the return of their property at any time as long as
the possession was unauthorized or merely tolerated, if at all. This right is never barred by laches. (Emphasis supplied).

To the same effect is our pronouncement in Urquiaga vs. Court of Appeals,[30] to wit:

We find no reversible error committed by respondent Court of Appeals. We sustain private respondents ownership of Lot No. 6532-B. As
between the verbal claim of ownership by petitioners through possession for a long period of time, which was found by the
court a quo to be inherently weak, and the validly documented claim of ownership of respondents, the latter must naturally
prevail.

WHEREFORE, the instant petition is DENIED and the assailed decision and resolution of the Court of Appeals AFFIRMED. Costs against
petitioners. SO ORDERED.
 [G.R. No. 142913. August 9, 2005]

ESTATE OF SALVADOR SERRA SERRA (SPEC. PROC. NO. 242) AND ESTATE OF GREGORIO SERRA SERRA (SPEC. PROC. NO. 240),
BOTH REPRESENTED BY THE JUDICIAL CO-ADMINISTRATOR LUIS ISASI, MARGARITA SERRA SERRA, FRANCISCA
TERESA SERRA SERRA and FRANCISCO JOSE SERRA SERRA, petitioners, vs. HEIRS OF PRIMITIVO HERNAEZ,
REPRESENTED BY PRESENTACION HERNAEZ BELBAR, HEIRS OF LUISA HERNAEZ, REPRESENTED BY WILFREDO
GAYARES, LOLITA GAYARES, JULIETA FORTALEZA AND ROSAURO FORTALEZA, HEIRS OF ROGACIANA HERNAEZ,
REPRESENTED BY LOURDES MONCERA, respondents.

DECISION

YNARES-SANTIAGO, J.:

This petition for review on certiorari under Rule 45 of the 1997 Revised Rules of Civil Procedure assails the March 3, 2000 decision of the
Court of Appeals in CA-G.R. SP No. 52817, and its April 17, 2000 resolution denying reconsideration thereof.

The factual antecedents are as follows:

On December 27, 1967, a petition for reconstitution of alleged lost original certificates of title (OCT) and owners duplicate copies in the
name of Eleuterio Hernaez covering Lot No. 1316 of Kabankalan Cadastre and Lot Nos. 2685 and 717 of Ilog Cadastre, in the Province of
Negros Occidental, was filed by his successors-in-interest Primitivo, Rogaciana and Luisa, all surnamed Hernaez (Hernaez) with then Court of
First Instance (CFI) of Bacolod City.

On April 6, 1968, the CFI granted the petition and ordered the reconstitution of the subject OCTs and its duplicate copies.[1] Accordingly,
the Register of Deeds of Negros Occidental issued reconstituted OCT Nos. RO-10173, RO-10174, and RO-10175, for Lot Nos. 1316, 2685, and
717, respectively. These reconstituted OCTs were cancelled on May 29, 1969 upon presentation by Hernaez of a declaration of heirship and in
lieu thereof, Transfer Certificate of Title (TCT) Nos. T-51546, T-51547, and T-51548 were issued in their names.

Upon learning of the existence of the above TCTs, Salvador Serra Serra, for and in behalf of his co-heirs, registered their adverse claim
and moved for the cancellation of the reconstituted titles. They averred that they are holders of valid and existing certificates of title over the
subject properties and have been in continuous and actual possession thereof.

The trial court denied petitioners motion to cancel the reconstituted titles and granted instead Hernaez prayer that they be placed in
possession of the subject properties, which petitioners challenged before the Court of Appeals in a petition for certiorari docketed as CA-G.R.
No. SP-00139.[2]

On June 7, 1971, the appellate court issued a writ of preliminary injunction [3] which was ordered lifted in a resolution dated August 3,
1971. Petitioners motion for reconsideration was denied, hence they filed before this Court a petition for certiorari, prohibition and
mandamus, docketed as G.R. No. L-34080 and consolidated with G.R. No. L-34693,[4] seeking to annul the resolution lifting the writ of
preliminary injunction.

On March 22, 1991, this Court rendered judgment the decretal portion of which reads:

ACCORDINGLY, the petitions are GRANTED. The questioned order of the respondent Court of Appeals lifting the writ of preliminary injunction
is SET ASIDE. The writ of possession issued in Cadastral Case No. 17, GLRO Records No. 163 is declared NULL and VOID. The records of this
case and of CA-G.R. No. 00139 are remanded to the trial court for hearing of the motion for cancellation of the reconstituted titles. Private
respondents are ordered to return to petitioners the possession of the properties in question. The temporary restraining order issued by this
Court on February 15, 1972, enjoining private respondents from interfering in any manner, with petitioners right of possession of the
properties in question, shall remain effective until the issue of ownership and/or possession of the properties is finally settled by a competent
court.

SO ORDERED.[5]

Pursuant thereto, the trial court heard petitioners motion for cancellation of certificates of title and on November 25, 1998, rendered
judgment the dispositive portion of which reads:

WHEREFORE, based on the foregoing premises and considerations, the court hereby renders judgment in favor of the oppositors and hereby
orders the following:

1) The petition filed by movants Serra Serra dated November 4, 1968 is hereby DISMISSED for lack of merit;

2) Declaring the Transfer Certificate of Title No. T-27644 covering Lot No. 1316, Kabankalan Cadastre and Lot No. 2685, Ilog Cadastre,
Transfer Certificate of Title No. T-22344 covering Lot No. 717-A, and Transfer Certificate of Title No. T-22351, Ilog Cadastre, all issued in the
name of movants Serra Serra NULL and VOID for being issued to foreigners;

3) Declaring the oppositors Hernaez as owners of Lot No. 1316, Kabankalan Cadastre, covered by Transfer Certificate of Title No. 51546; Lot
No. 2685, Ilog Cadastre, covered by Transfer Certificate of Title No. T-51547; and Lot No. 717, Ilog Cadastre, covered by Transfer Certiticate
of Title No. T-51548; and

4) Ordering the movants Serra Serra to return possession of said lots to the oppositors Hernaez.

SO ORDERED.[6]

Without filing a motion for reconsideration, petitioners assailed the lower courts decision before the Court of Appeals via a petition
for certiorari. On March 3, 2000, the appellate court rendered the herein assailed judgment which dismissed the petition for lack of merit,
pertinent portion of which reads:

In the case at bench, We find no cogent reason to disturb the assailed decision denying petitioners motion for cancellation of the reconstituted
titles, especially after the court a quo found that the evidence presented is sufficient and proper to uphold the reconstituted certificates of title
in question. A perusal of the assailed order shows that the trial court correctly applied the established legal principle that in cases of
annulment and/or reconveyance of title, a party seeking it should establish not merely by a preponderance of evidence but by clear and
convincing evidence that the land sought to be reconveyed is his.

Petitioners (Serra Serra), however, as noted by the court a quo in its Order dated November 25, 1998, failed to present in court as evidence
the original certificates of title of the aforementioned lots, Lot No. 1316, Lot No. 2685 and Lot No. 717. Petitioners were also found to be of
Spanish citizenship and, hence, as aliens, disqualified to acquire lands in the Philippines under the 1935 Constitution.[7]
 Petitioners motion for reconsideration was subsequently denied, hence the instant petition based on the following assigned errors:

THE COURT OF APPEALS HAS ... DEPARTED FROM THE ACCEPTED AND USUAL COURSE OF JUDICIAL PROCEEDINGS AS TO CALL FOR THE
EXERCISE OF THE POWER OF SUPERVISION BY THIS HONORABLE COURT, IN THAT:

THE RULE THAT THE PETITIONER SHOULD HAVE PREVIOUSLY FILED A MOTION FOR RECONSIDERATION WITH THE LOWER COURT BEFORE
HE MAY AVAIL HIMSELF OF THE WRIT OF CERTIORARI UNDER RULE 65 OF THE RULES OF COURT IS SUBJECT TO WELL-SETTLED
EXCEPTIONS ...

...

II

THE COURT OF APPEALS ... HAS DECIDED A QUESTION OF SUBSTANCE IN A WAY PROBABLY NOT IN ACCORD WITH LAW, REPUBLIC ACT NO.
26, OR WITH THE APPLICABLE DECISION OF THIS HONORABLE COURT IN SERRA VS. COURT OF APPEALS, G.R. NO. L-34080, MARCH 22,
1991.[8]

Petitioners assail the dismissal of their petition on the ground that they failed to file a motion for reconsideration with the lower court
before filing a petition for certiorari before the Court of Appeals. While admitting procedural lapse on their part, they argue that the rule is
subject to well-settled exceptions, such as, when the questions raised before the Supreme Court are the same as those which have been
squarely raised and passed upon by the trial court, or when the petitioner has been deprived of due process of law, or when the writ is urgent
under the circumstances.[9]

The petition is denied. Other than citing general exceptions to the rule requiring a motion for reconsideration as a pre-condition to
instituting a petition for certiorari, the petitioners did not offer valid reason why their particular case fall under any of the specified exceptions.

The settled rule is that a motion for reconsideration is a sine qua non condition for the filing of a petition for certiorari. The purpose is to
grant an opportunity to public respondent to correct any actual or perceived error attributed to it by the re-examination of the legal and
factual circumstances of the case.[10] Petitioners failure to file a motion for reconsideration deprived the trial court of the opportunity to rectify
an error unwittingly committed or to vindicate itself of an act unfairly imputed. Besides, a motion for reconsideration under the present
circumstances is the plain, speedy and adequate remedy to the adverse judgment of the trial court.

Granting arguendo that certiorari is the proper remedy, the Court of Appeals nevertheless did not err in dismissing the petition.

Both the trial court and the Court of Appeals found that petitioners are Spanish citizens and as such, disqualified from acquiring lands in
the Philippines. As a rule, only a Filipino citizen can acquire private lands in the Philippines and the only instances when a foreigner can own
private lands are by hereditary succession and if he was formerly a natural-born Filipino citizen who lost his Philippine citizenship. The records
are bereft of any showing that petitioners derived their title by any mode which would qualify them to acquire private lands in the country.
Petitioners bare allegation that they acquired the subject lots from Salvador Serra Serra has no probative value lacking sufficient proof that
the latter is not disqualified to own or hold private property and was able to legally transmit to petitioners title thereto.

Petitioners alleged possession of TCTs and actual possession of the subject lands, although strong proof of ownership, are not
necessarily conclusive where the assertion of proprietary rights is founded on dubious claim of ownership. They claimed that their title over
the subject properties emanated from Salvador Serra Serra; yet they failed to present in evidence the OCT in the name of the latter. Since
petitioners impugn the proprietary claim of Hernaez over the properties, the burden rests on them to establish their superior right over the
latter. To recall, the trial court found that the evidence they presented have not established superior proprietary rights over the respondents
on the subject lots. It held that the non-presentation of the OCTs cast doubt on the veracity of their claim. He who asserts must prove.

It is also undisputed that petitioners are all Spanish citizens. Under Philippine law, foreigners can acquire private lands only by
hereditary succession or when they were formerly natural-born Filipinos who lost their Philippine citizenship. In this case, petitioners did not
present proof that they acquired the properties by inheritance. Neither did they claim to be former natural-born Filipinos. On the contrary,
they declare in this petition that they are all Spanish citizens residing in Mallorca, Spain.

It is axiomatic that factual findings of trial courts, when adopted and confirmed by the Court of Appeals, are binding and conclusive and
will not be disturbed on appeal. This Court is not a trier of facts. It is not its function to examine and determine the weight of the evidence
supporting the assailed decision. Moreover, well entrenched is the prevailing jurisprudence that only errors of law and not of facts are
reviewable by this Court in a petition for review on certiorari under Rule 45 of the Revised Rules of Court, which applies with greater force to
the petition under consideration because the factual findings of the Court of Appeals are in full agreement with what the trial court found.[11]

WHEREFORE, the petition is DENIED. The March 3, 2000 decision and the April 17, 2000 resolution of the Court of Appeals in CA-G.R.
SP No. 52817 are AFFIRMED. SO ORDERED.
 [G.R. No. 145849. July 22, 2005]

SPOUSES JOSE BEJOC and JOVITA CAPUTOL BEJOC, petitioners, vs. PRIMA CALDERON CABREROS and COURT OF
APPEALS, respondents.

DECISION

CORONA, J.:

Assailed in this petition for review under Rule 45 of the Rules of Court [1] are the decision[2] and resolution[3] of the Court of
Appeals[4] which affirmed the trial courts judgment[5]declaring respondent the lawful owner of two parcels of agricultural land, the subject of
this petition.

The original owner of the disputed parcels of land was Maura Caputol, the mother-in-law of respondent. On November 7, 1975, Maura
Caputol executed a deed of donation inter vivosin favor of her son, Domingo Cabreros. The latter accepted the donation in the same
instrument.

Domingo and his wife, respondent Prima Cabreros, took physical possession of the lots. In 1976, they had the tax declarations in the
name of Maura Caputol cancelled and transferred to them.[6]

When the new owners and Maura Caputol migrated to Hawaii, they left the charge and administration of the land to petitioner spouses.
Aside from being the uncle and aunt of Domingo, they were chosen as caretakers because they had been the overseers of the properties even
before the donation to Domingo.

As caretakers, the petitioners were tasked to deliver the harvest to Lucinda Calderon, [7] the mother of respondent Prima Calderon
Cabreros. They were also responsible for paying the taxes due thereon, to be taken from the proceeds of the sale of the crops.

When Domingo died in Hawaii in 1979, his forced heirs, respondent Prima and a minor daughter, succeeded to his estate. [8]

Sometime in October 1989, respondent Prima made a visit to the Philippines and went to Danao City, Cebu. She heard rumors that
petitioner spouses were exercising acts of ownership over the disputed land. With her mother-in law Maura Caputol, she confronted
petitioners about the rumors but the latter initially denied the accusations. Later on, however, they claimed that Maura Caputol gave the
properties to them, an allegation disclaimed by Maura who said it was no longer possible for her to give the properties to her younger sister,
petitioner Jovita, because she had already donated them to her son Domingo in 1975.

Respondent also found out that petitioners stopped delivering the harvest to her mother since 1984. Moreover, she discovered that in
1981, Tax Declaration (TD) No. 19470 in the name of Domingo Cabreros issued in 1980 for the first parcel of land (parcel 1) was mysteriously
cancelled and changed by TD No. 25472. This new tax declaration was issued in the name of Maura Caputol on the basis of a quitclaim
allegedly executed before notary public Leonardo Garcillano in 1971, annotated therein. The same thing happened to the second parcel of
land (parcel 2). The property was declared in the name of Domingo Cabreros in 1980 under TD No. 19471. Yet, in 1983, this TD was
cancelled and changed by TD No. 25473 issued in the name of Maura Caputol, based on the same quitclaim.

In 1984, TD No. 25472 for parcel 1 and TD No. 25473 for parcel 2, both in the name of Maura Caputol, were cancelled by TD No. 24007
and 15-26009, respectively. These new declarations were now in the name of petitioner Jovita Caputol, based on a deed of confirmation of
sale dated May 18, 1984 annotated therein. This document was allegedly executed by Maura Caputol in favor of petitioner Jovita.

Respondent further found that the petitioner spouses applied for a free patent on the properties. On October 17, 1984, Original
Certificate of Title (OCT) No. 26947 was issued to petitioner Jose Bejoc by virtue of free patent no. (VII-5)17844 which he was able to obtain.

Earnest efforts to have the controversy settled out of court were unsuccessful as petitioners even dared respondent to sue them in
court. Consequently, the respondent filed an action for reconveyance against the petitioner spouses on February 1, 1990 before Branch 17,
Regional Trial Court (RTC) of Cebu.

In their answer, petitioners alleged that they had been in possession of the parcels of land as administrators since 1974 and as absolute
owners since 1978. They claimed that Maura Caputol never donated the parcels of land to her son Domingo.

On December 24, 1978, Maura Caputol allegedly sold the subject properties to petitioners for P5,000 in a deed of sale. This sale was
later on confirmed in another document dated May 18, 1984. From then on, they exercised their rights as owners of the land and paid the
taxes due beginning 1979. They also successfully applied for a free patent on the properties. In 1984, they were issued an original certificate
of title.

Lastly, they contended that, even assuming the truth of respondents allegations, the action for reconveyance was already barred by
prescription.

From the evidence adduced, the trial court ruled:

WHEREFORE, premises considered, judgment is rendered for the plaintiff and against the defendants hereby declaring the plaintiff as the true,
absolute and lawful owner of the two parcels of land in question; ordering the defendants to reconvey the aforesaid properties in favor of the
plaintiff; ordering the defendants to jointly and severally pay plaintiff the sum of Three Thousand (P3,000.00) Pesos a year from 1978 with
legal rate of interest until the two parcels of land shall have been reconveyed and delivered to the plaintiff plus costs of this action.[9]

The Court of Appeals affirmed the trial courts judgment in a decision dated September 20, 1999. [10] The motion for reconsideration was
likewise denied on October 13, 2000.[11]

Hence, petitioner spouses are now before us via a petition for review under Rule 45 of the Revised Rules of Court.

The sole issue raised in this petition is whether or not respondents action for reconveyance has prescribed.

Petitioner spouses contend that respondents action for reconveyance was based on fraud, not implied trust, as found by the trial and
appellate courts. Respondents allegation was that petitioner spouses conspired to transfer the tax declarations in their names and obtained
title for the parcels of land by fabricating the quitclaim, contract of sale and deed of confirmation of sale. Since the fraud committed by
petitioners ― not implied trust ― was the basis of the action, the prescriptive period was 4 years and not 10 years as enunciated in Millena v.
Court of Appeals.[12] This period should be reckoned either from the time that petitioners committed unequivocal acts of repudiation in 1978
or from the time the OCT was issued in their names in 1984. Considering that more than four years had passed in either case, it was clear
error for the Court of Appeals to hold that respondents action for reconveyance had not yet prescribed when it was filed in 1990.

We find no merit in the petition.

An implied trust is one that, without being express, is deducible from the nature of the transaction as a matter of intent or which is
superinduced on the transaction by operation of law as a matter of equity, independently of the particular intention of the parties.[13] It may
either be resulting or constructive trust.

A resulting trust is presumed to have been contemplated by the parties, the intention as to which is to be found in the nature of their
transaction but not expressed in the deed itself.[14] It is based on the equitable doctrine that valuable consideration, not legal title,
determines the equitable title or interest.[15]
 A constructive trust is created, not by any word evincing a direct intention to create a trust, but by operation of law in order to satisfy
the demands of justice and to prevent unjust enrichment. It arises contrary to an agreement or intention against one who, by fraud, duress
or abuse of confidence, obtains or holds the legal right to property which he ought not, in equity and good conscience, to hold.[16] A
constructive trust is illustrated in Article 1456 of the Civil Code:

ARTICLE 1456. If the property is acquired through mistake or fraud, the person obtaining it is by force of law, considered a trustee of an
implied trust for the benefit of the person from whom the property comes.

It is on this ground that we find no error in the trial and appellate courts findings that an implied trust was created in favor of
respondent when petitioners transferred the properties to their names in violation of the trust placed in them as overseers. Records show
that, while the properties were under their administration, they transferred the tax declarations in the name of Domingo Cabreros to Maura
Caputol on the basis of a fake quitclaim purportedly executed in 1971. These tax declarations were in turn transferred to petitioner Jovita
Caputol on the strength of a fraudulent deed of confirmation of sale supposedly executed by Maura Caputol on May 18, 1984.

All these documents, including a deed of sale allegedly executed in 1978, were denounced as spurious by Maura Caputol. She explained
that she had donated the properties to her only son Domingo Cabreros on November 7, 1975. There was no way she could have sold these
properties thereafter, considering that she no longer owned them. Also, at the time of the alleged confirmation of sale, Maura Caputol was
already 78 years old and living alone. At that age, she could have been easily manipulated by her sister, petitioner Jovita, into signing just
about any document.

Telling is her testimony regarding the deed of confirmation of sale:

Q: Now Mrs. Caputol, I will show to you this document evidencing the confirmation of sale from you to your sister. In fact they
have the signature of Maura Caputol marked on their exhibit. Can you identify that signature?

A: I signed the document just to confirm that they are the one staying [in] the house and over-seeing the
property and I did not sell the property and in fact I even wanted to buy some more.[17] (emphasis ours)

Moreover, the quitclaim and the deed of sale, upon which petitioners based their claim, were never presented. Considering that they
were the ones who had been asserting the existence of these documents, it was incumbent upon them to present said documents to prove
that the properties had indeed been sold to them by Maura Caputol. The fundamental rule is that he who alleges must prove. [18] Petitioners
failure to do so was therefore fatal to their cause.

More telling is the fact that OCT No. 26947 was issued in the name of petitioner Jose Bejoc on October 17, 1984 by virtue of Free Patent
No. (VII-5) 17844. Undoubtedly, the patent and title were obtained by the petitioner spouses in flagrant breach of the confidence reposed in
them by Maura Caputol, and Domingo Cabreros and his wife, respondent Prima. The evidence was that petitioners knew all along that the
properties were not theirs. They, in fact, admitted that they were mere overseers thereof.

We have already held that simple possession of a certificate of title is not necessarily conclusive of a holders true ownership of property.
If a person obtains title that includes land to which he has no legal right, that person does not, by virtue of said certificate alone, become the
owner of the land illegally or erroneously included.[19] It has been held time and again that the rule on indefeasibility of title cannot be used
for the perpetration of fraud against the real owner.[20]

In Viral v. Anore, et al. [21] we ruled that:

While under ordinary circumstances the statute of limitations may bar an action to cancel a Torrens title issued upon a free patent, yet where
the registered owner x x x knew that the parcel of land described in the patent and in the Torrens title actually belonged to another person,
such statute barring action will not apply. It may be the better procedure, however, that the true owner bring an action to have the ownership
or title to the land judicially settled, and the court in the exercise of its equity jurisdiction, without ordering the cancellation of the Torrens
title issued upon the patent, may direct the registered owner to reconvey the land to the rightful owner. (emphasis ours)

The right to seek reconveyance based on an implied or constructive trust is not absolute. It is subject to extinctive prescription.[22] On
this point, petitioners insist that the action prescribed in 4 years as held in the case of Millena v. Court of Appeals.[23] Petitioners insistence is,
however, misplaced. The 4-year prescriptive period is not applicable in the present case because the action was not based exclusively on
fraud but on implied trust. Significantly, petitioners overlooked the well-settled rule, reiterated in the same case, that an action for
reconveyance based on implied or constructive trust prescribes in 10 years.

This period is reckoned from the date of the issuance of the original certificate of title or transfer certificate of title. Since such issuance
operates as a constructive notice to the whole world,[24] the discovery of the fraud is deemed to have taken place at that time. Here, the title
was issued on October 17, 1984. The action for reconveyance was, on the other hand, filed 6 years later, on February 1, 1990. Clearly,
prescription had not yet attached. The suit was brought well within the 10-year prescriptive period for implied trusts.

WHEREFORE, the petition is hereby DENIED. The assailed decision and resolution of the Court of Appeals are hereby AFFIRMED in toto.
Costs against petitioners. SO ORDERED.
EDWARD ROCO TAN G.R. No. 168809

and EDWIN ROCO TAN,

Petitioners,

- versus -

BENIGNO DE LA VEGA, ANGELA

TUASON STALEY and ANTONIO Promulgated:

PEREZ Y TUASON,

Respondents. March 10, 2006

x ---------------------------------------------------------------------------------------- x

DECISION

YNARES-SANTIAGO, J.:

Assailed in this petition for review is the February 3, 2005 Decision[1]of the Court of Appeals in CA-G.R. CV No. 79957, which

affirmed the March 21, 2003 Order[2]of the Regional Trial Court of Pasig City, Branch 264, granting the motion for judgment on the pleadings

filed by respondents in Civil Case No. 62269. Likewise questioned is the appellate courts July 6, 2005 Resolution [3]which denied petitioners

motion for reconsideration.

The undisputed facts show that on August 3, 1992, respondents filed a complaint for quieting of title and for declaration of nullity of

Free Patent No. 495269, Original Certificate of Title (OCT) No. 711 and Transfer Certificate of Title (TCT) No. 186516, against the heirs of

Macario Mencias (defendant heirs), namely, Aquilina Mencias, Aurora M. Gabat, Merlyn M. Cadete, Myrna M. Quirante; and the Secretary of

the Department of Environment and Natural Resources, the Director of the Land Management Bureau and the Register of Deeds of

Marikina. The complaint was later amended to implead herein petitioner purchasers of the disputed lot and to nullify TCT No. 272191 issued in

their name.

The Amended Complaint averred that respondents are the co-owners of a 159,576 square meter parcel of land located in Marikina,

Rizal, Metro Manila and covered by TCT No. 257152, issued on June 20, 1969. Said title was a transfer from TCT No. 22395 in the name of J.

Antonio Araneta as trustee of the children of Angela I. Tuason. Among the lots covered by TCT No. 257152 is the controverted Lot 89

containing an area of 54,197 square meters.[4]

Sometime in April 1992, respondents learned that the defendant heirs are causing the ejectment of the occupants of a 29,945

square meter portion of Lot 89; and that Macario Mencias was able to obtain Free Patent No. 495269 on July 31, 1971, and OCT No. 711 on

August 11, 1971, over said portion. Upon Macario's death, OCT No. 711 was canceled and TCT No. 186516 was issued to the defendant heirs

on July 5, 1990.[5] By virtue of a Deed of Sale inscribed on November 14, 1994, TCT No. 186516 was further cancelled and TCT No. 271604

was issued on the same date in favor of New Atlantis Real Estate & Development, Inc., (Corporation) represented by its President, Victor C.

Salvador, Jr. The questioned lot was thereafter sold by the Corporation to petitioners. TCT No. 271604 was thus cancelled and in lieu thereof,

TCT No. 272191 was issued to petitioners on November 17, 1994.[6]

Respondents contended that Macarios OCT No. 711 and its derivative titles-TCT No. 186516, in the name of defendant heirs and

petitioners TCT NO. 272191, are void because the area they cover is entirely within their (respondents) land, specifically, Lot 89, as shown by

the notation in the said titles, i.e., This survey is covered by F.P.A. No. (III-1) 4496; and This survey is entirely inside No. 89, II-

4755.[7] Respondents further averred that since the controverted lot is already a private land, the Director of Lands and the Secretary of
Agriculture and Natural Resources, had no jurisdiction to approve Macarios application and to issue Free Patent No. 495269. The pendency of

this action was allegedly inscribed in the defendant heirs title (TCT No. 186516) on August 4, 1992 and carried over to the petitioners' TCT

No. 272191.[8]

In their Answer,[9]the defendant heirs contended that Lot 89 was never part of respondents TCT No. 257152 which originated

from OCT No. 730. Respondents own exhibits, i.e., the documents purportedly issued by the Bureau of Lands (Exhibits E and F), show that

Lot 89 was covered by OCT No. 734 and not OCT No. 730. Defendant heirs further stated that respondents TCT No. 257152 was issued in

lieu of TCT No. 22395 which is a mere reconstitution of TCT No. 45046. Upon verification with the Register of Deeds of Rizal, TCT No. 45046,

covers a different parcel of land situated in San Juan, Rizal, and measuring about 356 square meters only. The defendant heirs also raised the

defenses of laches and prescription.

On the other hand, petitioners asserted, inter alia, that they are purchasers in good faith and for value and that they have no

knowledge of any defect in the title of the Corporation from whom they purchased the controverted lot. The notice of lis pendens alleged to

have been inscribed in TCT No. 186516 on August 4, 1992 does not appear in the Corporations title, TCT No. 271604 nor in their title, TCT

No. 272191. Absent said notice, petitioners claim that they cannot be charged with knowledge of any defect in the Corporation's title. Neither

does the note This survey is covered by F.P.A. No. (III-1) 4496; and This survey is entirely inside No. 89, II-4755, serve as sufficient warning

to third persons because said notes do not indicate that the property is covered by another title. [10]

For failure to file their Answer, defendant Aurora M. Gabat,[11] public defendants Secretary of the Department of Environment and

Natural Resources, Director of Land Management Bureau and the Register of Deeds of Marikina,[12]were declared in default.

On March 4, 2003, respondents filed a motion for judgment on the pleadings which was granted by the trial court. It was held that

the disputed lot is within Lot 89 covered by respondents TCT No. 257152, issued on June 20, 1969. Said lot therefore became a private land

long before the Free Patent was issued to Macario on July 31, 1971. Hence, the titles derived or issued on the basis of said Free Patent are

void because Public Land Act applies only to public lands and not private lands. On the theory that the spring cannot rise higher than its

source, the trial court concluded that petitioners cannot be purchasers in good faith considering that their title was derived from Macario who

acquired the property by virtue of a void title. It further ruled that petitioners defense of good faith must fail because they were forewarned of

the notice indicating that the questioned lot is inside Lot 89. The dispositive portion of the March 21, 2003 order, reads:

WHEREFORE, premises considered, Plaintiffs [respondents herein] Motion is hereby Granted and judgment rendered as
follows:

1. Plaintiffs Transfer Certificate of Title (TCT) No. 257152 is declared valid and superior to defendants [petitioners] TCT No.
272191;

2. Free Patent No. 495269 issued by then Secretary of Environment and Natural Resources to Macario Mencias on July 21,
1971 is declared null and void;

3. Original Certificate of Title (OCT) No. 711, Transfer Certificate of Title (TCT) No. 271604/T-1358 and Transfer Certificate
of Title (TCT) No. 272191, TCT No. 186516 and TCT No. 272191, all derivatives [sic] title of Free Patent 495269 issued by
Registry of Deeds of Marikina, are also declared null and void;

4. The Bureau of Lands and Land Registration Administration are directed to enter into their technical files the findings in
this order;

5. The Registry of Deeds of Marikina is directed to cancel Transfer Certificate of Title (TCT) NO. 272191 in the names of
Edward and Edwin Roco Tan.

SO ORDERED.[13]
 Petitioners appealed to the Court of Appeals which affirmed the assailed order of the trial court. They filed a motion for

reconsideration but was denied in a resolution dated July 6, 2005.

Hence, this petition.

The sole issue for resolution is whether a judgment on the pleadings is proper in the instant case.

Section 1, Rule 34 of the Rules of Court, states:

SECTION 1. Judgment on the pleadings. Where an answer fails to tender an issue, or otherwise admits the material
allegations of the adverse partys pleading, the court may, on motion of that party, direct judgment on such pleading. x x
x.

Where a motion for judgment on the pleadings is filed, the essential question is whether there are issues generated by the

pleadings. In a proper case for judgment on the pleadings, there is no ostensible issue at all because of the failure of the defending partys

answer to raise an issue.[14]The answer would fail to tender an issue, of course, if it does not deny the material allegations in the complaint or

admits said material allegations of the adverse partys pleadings by confessing the truthfulness thereof and/or omitting to deal with them at

all. Now, if an answer does in fact specifically deny the material averments of the complaint and/or asserts affirmative defenses (allegations

of new matter which, while admitting the material allegations of the complaint expressly or impliedly, would nevertheless prevent or bar

recovery by the plaintiff), a judgment on the pleadings would naturally be improper.[15]

In this case, we find that the trial court erred in rendering judgment on the pleadings because the pleadings filed by the parties

generated ostensible issues that necessitate the presentation of evidence. Respondents action for declaration of nullity of Free Patent No.

495269 and the titles derived therefrom is based on their claim that the lot titled in the name of petitioners, is a portion of a bigger tract of

land previously titled in the name of their (respondents) predecessors-in-interest. The documents presented in support thereof were the

photocopy of respondents TCT No. 257152 which shows that the land it covers, including lot 89, originated from OCT No. 730; and

photocopies of the documents alleged to have been issued by the Bureau of Lands and confirming that the disputed lot is a portion of

respondents Lot 89. Pertinent portions of the Amended Complaint, state:

5. Sometime in early April, 1992, plaintiff de la Vega was informed by one of the occupants of the above-
described lot No. 89 that the heirs of Macario Mencias, the defendants herein, were causing the ejectment of said
occupants and claiming to be the owners of an area of 29,945 sq. ms. (sic) which is within, or part of, Lot No. 89 covered
by plaintiffs T.C.T. No. 257152. It was only then that the plaintiffs heard of Macario Mencias and of his encroaching into
plaintiffs Lot 89.

6. The plaintiffs later learned that, unknown to them, Macario Mencias had applied with the then Bureau of Lands
for, and obtained on 31 July 1971, Free Patent No. 495269 which was granted under the signature of the then Secretary of
Agriculture and Natural Resources and covering an area of 29,945 sq. ms. (sic) as described in Plan F (III-1) 4496-D. On
11 August 1971, Original Certificate of Title No. 711 (Rizal) was issued to him based on the said Free Patent, and upon his
death, said OCT No. 711 was cancelled and transferred to his heirs, the defendants herein, to whom T.C.T. No. 186516
(Marikina) was issued on 5 July 1990. The plaintiffs were never notified of said application of Mencias for free patent nor of
the issuance of Free Patent No. 495269 and OCT No. 711 to him and T.C.T. No. 186515 to his heirs, the defendants herein.
Photocopies of OCT No. 711, which incorporated Free Patent No. 495269, and T.C.T. No. 186516 are hereto appended as
Annexes B and C, respectively.

xxxx

8. A letter dated 29 October 1971 of Mr. Amando A. Salvador as Chief of the Survey Division of the then Bureau
of Lands and addressed to Macario Mencias, 1st Indorsement, dated 15 February 1974, signed by Mr. Daniel C. Florida as
Acting Chief of the Legal Division of the Bureau of Lands, a report dated 17 December 1976 by Mr. Jose B. Isidro as
Hearing Officer addressed to the Director of Lands, and the 1st Indorsement, dated 3 January 1977, also addressed to the
Director of Lands by Mr. Claudio C. Batiles as the District Land Officer, photocopies of which are appended hereto as
Annexes D, E, F and G, respectively, unequivocally confirmed that the area of 29,945 sq. ms. (sic) covered by the Free
Patent based on Plan F (III-1) 4496-D and issued to Macario Mencias was entirely inside Lot 89 of Plan II-4755, which was
covered by T.C.T. No. 22395 in the name of J Antonio Araneta, Trustee of the children Angela I. Tauson, and since 20 June
1969, by T.C.T. No. 257152 in the plaintiffs names.

9. There can be no doubt that the area of 29,945 sq. ms. (sic) covered by Free Patent No. 495269, which was
incorporated in OCT No. 711 issued to Macario Mencias, was within Lot 89 of Plan II-4755 covered by T.C.T. No. 22395
and, since 20 June 1969, by T.C.T. No. 2597152 (sic) in the plaintiffs names, because the technical description of said area
embodied in the said Free Patent itself and in OCT No. 711 disclosed the following information:

NOTE: This survey is covered by F.P.A. No. (III-1) 4496.

This survey is entirely inside No. 89, II-4755 (See Annex B hereof). (See Annex B hereof).
 10. In fact the very same notes were carried over in T.C.T. No. 186516 issued to the heirs of Mencias, the
defendants herein, thus forewarning all those who dealt or may have dealt with the private defendants regarding the area
therein described that there was something anomalous in said title (See Annex C hereof).

xxxx

14. The records of the Registry of Deeds of Marikina, Metro Manila, disclosed that TCT No. 186516, Annex C, was
cancelled and T.C.T. No. 271604, covering the same parcel of land covered by T.C.T. No. 186516, was issued on
November 14, 1994 by the Register of Deeds of Marikina, Mr. Artemio B. Caa, to the New Atlantis Real Eastate & Dev., Inc.
represented by its President, Victor C. Salvador, Jr., based on a sale in its favor inscribed on the same date; and that
T.C.T. No. 271604 was thereupon cancelled and in lieu thereof T.C.T. No. 272191 was issued by the said Register of Deeds
to private defendants Edward and Edwin Roco Tan on November 17, 1994 based on a sale in their favor inscribed on the
same date. A photocopy of T.C.T. No. 272191 is hereto attached as Annex H.

xxxx

16. Neither New Atlantis Real Estate & Dev. Inc., nor Edward Roco Tan and Edwin Roco Tan could claim to be
purchasers in good faith not only because their titles are void and inexistent and could not possibly have any legal effect
whatsoever but also because the NOTE cited in paragraphs 9 and 10 above, which likewise appears on T.C.T. No. 272191
itself, discloses the very basis for its nullity.
17. The notice of the pendency of this action (Notice of Lis Pendens) was duly inscribed on T.C.T. No. 186516 on
August 4, 1992 under Entry No. 274711, which notice has been carried over to T.C.T. No. 272191, a photocopy of which is
hereto appended as Annex H.

x x x x.[16]

The foregoing averments were specifically denied by defendant heirs who raised, among others, the affirmative defense that

respondents TCT No. 22395 is void and that lot 89 is not found inside respondents land. Thus

11. Lot 89 was never a part of the Mariquina Estate as shown in subdivision plan PSD 29965 as surveyed in
December, 1950 up to June, 1951. This fact is also certified by the Office of the Register of Deeds of Rizal as early as
1967, a photo copy of said certification is hereto attached as Annex 1;
12. Plaintiffs own exhibits (Annexes E, F, in relation to Annex A) show that lot 89 was never part of Original
Certificate of Title (O.C.T.) No. 730 from which plaintiffs alleged title was derived (T.C.T. No. 257152, Annex A). In
Annexes E and F, Lot No. 89 of II-4755 is covered by O.C.T. No. 734 and not 730;

13. T.C. T. No. 257152 is spurious, falsified, hence, null and void. This certificate of title was issued in lieu of
T.C.T. No. 22395/T 389 as per Annex A of the Complaint. T.C.T. No.22395/T 389 was in turn issued in lieu of T.C.T. No.
45046 as shown in a document (T.C.T. No. 22395) hereto attached as Annex 2;

14. It also appears that T.C.T. No. 22395 is a mere reconstitution of a lost/destroyed T.C.T. No. 45046 as shown
on page 3 of T.C.T. No. 257152;

15. Upon verification with the Office of the Register of Deeds of Rizal, T.C.T. No. 45046 covered a different parcel
of land situated in San Juan, Rizal and measuring about 356 square meters only, photo copy of which is hereto attached as
Annex 3 hereof;

x x x x.[17]

Petitioners asserted, inter alia, the affirmative defense of good faith and denied the material allegations of the complaint relating to

the origin of the title of respondents; and the latters claim that Lot 89 is covered by TCT No. 257152. Pertinent portions of the Answer state:

In further support of the Specific Denials and Affirmative Allegations herein set forth, and by way of Affirmative
Defenses, defendants allege:
xxxx

4.2 Defendants are innocent purchasers for value of the subject property. They had no knowledge, actual or
constructive, of the alleged defect in their title, Transfer Certificate of Title No. 272191, or of the title of their predecessor-
in-interest, the Corporation.

4.2.1 Plaintiff's (sic) notice of lis pendens alleged to have been duly inscribed on TCT No. 186516 on August 4,
1992 under Entry No, 274711 did not appear or was not annotated on the corporations title, TCT No. 271604, which was
issued on November 14, 1994 or long after the alleged inscription was made on the said title. Attached and made integral
part hereof as Annex A is a copy of Corporation's title, TCT No. 271604.

4.2.2 Neither did said inscription appear or annotated on defendants title, TCT No. 272191, which was issued on
17 November 1994. Attached and made integral part hereof as Annex B is a copy of TCT No. 272191.

4.2.3 It bears stressing that if the said inscription was duly made on 4 August 1992 as plaintiffs alleged, the
same would have been annotated on TCT Nos. 271604 and 272191 which were issued long after the said entry was
allegedly made. Obviously, if said entry does appear today on TCT No. 272191, it was made only recently or at the
earliest, after the latter title was issued on 17 November 1994. But certainly said entry could not have been possibly made
on 4 August 1992.

4.2.4 With the absence of the notice of lis pendens, defendants could not be charged with notice of any defect in
their title No. 272191 nor their status as innocent purchasers for value be adversely affected by the same.
 4.2.5 Neither does the note, this survey is covered by F.P.A. No. (III-1) 4496; This survey is entirely inside No.
89 II-4755. serve as sufficient notice to defendants of any defect in their title. Said note does not indicate or disclose that
the subject property is covered by another title.

4.2.6 Moreover, the fact that the subject property was covered by TCT No. 271604 duly issued by the Registry of
Deeds in the name of the corporation without any encumbrance, liens or adverse claims annotated thereon negates any
possibility that the subject property belongs to any person other than the corporation.[18]

It is clear from the foregoing that the pleadings filed in the instant case generated the following issues: (1) whether respondents

TCT No. 257152 is valid; (2) whether Lot 89 is covered by TCT No. 257152; and (3) whether petitioners are purchasers in good faith. This is

clearly not a proper case for judgment on the pleadings considering that the Answers tendered factual issues. The trial court rendered a

summary judgment on March 21, 2003 and not a judgment on the pleadings.

In Narra Integrated Corporation v. Court of Appeals,[19]the Court explained the distinction between a proper case of summary

judgment and judgment on the pleadings, in this wise:

The existence or appearance of ostensible issues in the pleadings, on the one hand, and their sham or fictitious
character, on the other, are what distinguish a proper case for summary judgment from one for a judgment on the
pleadings. In a proper case for judgment on the pleadings, there is no ostensible issue at all because of the failure of the
defending partys answer to raise an issue. On the other hand, in the case of a summary judgment, issues apparently exist
― i.e. facts are asserted in the complaint regarding which there is as yet no admission, disavowal or qualification; or
specific denials or affirmative defenses are in truth set out in the answer―but the issues thus arising from the pleadings
are sham, fictitious or not genuine, as shown by affidavits, depositions, or admissions. x x x.

In any case, a summary judgment is likewise not warranted in this case as there are genuine issues which call for a full blown

trial. A genuine issue is an issue of fact which requires the presentation of evidence as distinguished from a sham, fictitious, contrived or false

claim. When the facts as pleaded appear uncontested or undisputed, then there is no real or genuine issue or question as to the facts, and

summary judgment is called for. The party who moves for summary judgment has the burden of demonstrating clearly the absence of any

genuine issue of fact, or that the issue posed in the complaint is patently unsubstantial so as not to constitute a genuine issue for trial. Trial

courts have limited authority to render summary judgments and may do so only when there is clearly no genuine issue as to any material

fact. When the facts as pleaded by the parties are disputed or contested, proceedings for summary judgment cannot take the place of trial. [20]

In the instant case, presentation of evidence is necessary to determine the validity of TCT No. 22395 from which respondents title

(TCT No. 257152) was derived. As alleged by defendant heirs, TCT No. 22395 was a mere reconstitution of TCT No. 45046, which per

verification from the Register of Deeds of Rizal pertain to a different piece of land measuring only about 356 square meters and located in San

Juan, Rizal. These allegations were never refuted by respondents, hence, they cannot be simply brushed aside by the trial court.

Moreover, even assuming that the title of respondents predecessors-in-interest (TCT No. 22395) is valid, the evidence at this stage

is still insufficient to sustain the conclusion of the trial court that Lot 89 is inside respondents land now covered by TCT No. 257152. The title

appended by respondents in their complaint is a mere photocopy.Likewise, the document allegedly issued by the Bureau of Lands and

presented by respondents to prove that Lot 89 is inside their land are also mere photocopies and not authenticated by said

office. Furthermore, the title referred in the said documents as the origin of TCT No. 257152, is a different title, that is OCT No. 734 and not

OCT No. 730.There is thus a need to present evidence to settle the issues in a full blown trial.

If the evidence show that the Free Patent and the OCT issued to petitioners predecessors-in-interest is valid and or Lot 89 is not

inside TCT No. 257152, then judgment should be rendered in favor of petitioners; and whether the latter acted in good or bad faith will no

longer be a decisive issue in this case. On the other hand, if the title of petitioners predecessors-in-interest is declared void, the defense of

good faith may still be available to petitioners who claim to be purchasers in good faith and for value. The rule is that a void title may be the

source of a valid title in the hands of an innocent purchaser for value. [21] An innocent purchaser for value is one who buys the property of

another, without notice that some other person has a right to, or interest in, such property and pays a full and fair price for the same at the

time of such purchase, or before he has notice of the claims or interest of some other person in the property.[22]

Since good faith is always presumed,[23]it was premature for the trial court to conclude that petitioners are not purchasers in good

faith. Note that the complaint did not state that the notice of the pendency of this action was inscribed in the title of the Corporation from

whom petitioners purchased the property. Petitioners even denied the presence of said inscription in their own title and in the title of the

Corporation.[24] Neither the presence of the notation This survey is covered by F.P.A. No. (III-1) 4496; and This survey is entirely inside No.
89, II-4755, in the title of the Corporation automatically make petitioners purchasers in bad faith. In the absence of other evidence to explain

said notation, bad faith, which is never presumed, cannot be charged against petitioners. The notation that the disputed lot is covered by Free

Patent Application No. (III-1) 4496, will not place the title in dubious light because the same is the number of the application for Free Patent

of Macario Mencias,[25]petitioners predecessor-in-interest. The same is true with respect to the notation in the title that the questioned lot is

inside Lot 89. Considering that the title presented is a mere photocopy and that the notes appearing thereon do not indicate that the subject

property is covered by any title, the trial court should have directed the parties to substantiate their respective allegations instead of

rendering judgment.Indeed, in determining the propriety of rendering a motion for summary judgment, the lower court should take that view

of the evidence most favorable to the party against whom it is directed, giving such party the benefit of all favorable inferences.[26]

In sum, we find that respondents failed to prove that presentation of evidence may be dispensed with in the present

controversy. The instant case is neither a proper case for rendition of judgment on the pleadings nor of summary judgment. A full blown trial

should therefore be conducted to resolve the issues raised by the parties.

WHEREFORE, in view of all the foregoing, the petition is GRANTED and the February 3, 2005 Decision and the July 6, 2005

Resolution of the Court of Appeals in CA-G.R. CV No. 79957 are REVERSED and SET ASIDE. Let the records of this case be remanded to the

Regional Trial Court of Pasig City, Branch 264 for further proceedings.SO ORDERED.
FLAVIANA LIM CAJAYON and G.R. No. 149118

CARMELITA LIM CONSTANTINO,

Petitioners,

- versus -

SPOUSES SANTIAGO and Promulgated:

FORTUNATA BATUYONG, February 16, 2006

Respondents.

x------------------------------------------------------------------------------------x

DECISION

TINGA, J.:

This petition for review on certiorari challenges the two rulings of the Court of Appeals in CA G.R. SP. No. 50952. The first decision dated 27

November 2000[1]upheld the ruling of the Regional Trial Court (RTC) affirming the Metropolitan Trial Court (MeTC) order for ejectment, while

the Resolution dated 5 July 2001[2]denied the motion for reconsideration.

First, the factual background of the case.

Flaviana Lim Cajayon and Carmelita Lim Constantino (petitioners) and Isagani P. Candelaria (Candelaria) were co-owners of a 260-square

meter lot, then covered by Transfer Certificate of Title (TCT) No. C-10870. On 1 February 1995, a partition agreement[3] was entered into by

petitioners and Candelaria, wherein Lot 6-A, Psd 00-034294, containing an area of 100 square meters, more or less, was adjudicated to

Candelaria, while Lot 6-B, Psd 00-034294, containing an area of 160 square meters, more or less, was given to petitioners. TCT No. C-10870

was cancelled and TCT No. 288500 was issued in the name of petitioners.

On 30 May 1995, Candelaria sold his property, including the improvements thereon, to Spouses Santiago and Fortunata Batuyong

(respondents). TCT No. 294743 was issued in their names over the said parcel of land.[4]

On 21 May 1996, petitioners started the construction of a seven (7)-door bungalow-type building that allegedly intruded into the lot of

respondents. At the instance of respondents, petitioners were summoned by barangay officials to a meeting on the matter. It was then

agreed upon that petitioners would defer the construction work pending the result of a relocation survey to be conducted by a government

surveyor.

A verification survey was conducted by Geodetic Engineer Florentina C. Valencia. She submitted a report dated 12 November 1996 which

yielded the findings that Lot 6-A (Candelarias) and Lot 6-B (petitioners) were not correctly positioned geographically on the ground with

respect to TCT No. 294743. Thus, as per survey, sub-lot B with an area of 10.43 square meters serves as right of way of Lot 6-B (petitioners

lot) while sub-lot C with an area of 10.18 square meters was the portion of Lot 6-A (respondents lot) presently occupied by petitioners.[5]

Despite the delineation of said boundaries, petitioners proceeded with the forestalled construction, allegedly occupying at least 20.61 square

meters of respondents lot, including the portion being used as right of way for petitioners tenants.

After respondents secured a permit from the barangay and the Caloocan City Building Official to fence their lot, they made demands to

petitioners to vacate the encroached portion but to no avail. Respondents brought the matter to the barangay but no amicable settlement was
reached. A Certificate to File Action was issued to them by the Barangay Lupon Tagapayapa. A final demand was made through a letter

dated 20 May 1997 upon petitioners to vacate the encroached premises.Petitioners, however, vehemently refused to vacate and surrender

the premises.

On 14 April 1997, respondents filed an ejectment case against petitioners before the Metropolitan Trial Court [6] (MeTC) of Caloocan City,

docketed as Civil Case No. 23359. In a Decision[7] dated 2 July 1998, the MeTC ordered petitioners to vacate and surrender possession of a

portion of respondents lot and to pay P500.00 per month as fair rental value from May 1996 until the premises is finally vacated,

plus P5,000.00 as attorneys fees and costs of the suit.[8]

On appeal, the RTC[9] affirmed the judgment of the MeTC.[10] In doing so, the RTC debunked the three (3) arguments posed by petitioners.

First, contrary to petitioners submission, the RTC ruled that the MeTC had jurisdiction over the instant complaint. The RTC noted that the

issue of jurisdiction was never raised in the court a quo while on the other hand, petitioners actively participated in the proceedings therein by

filing their Answer and Position Paper. Evidently, petitioners raised the question of jurisdiction as a mere afterthought as he did so only after

he obtained an adverse judgment. Second, the allegations of the complaint sufficiently averred a case for ejectment which the RTC found to

be within the jurisdiction of the court a quo. Third, the trial court ruled that petitioners categorically recognized the validity of the verification

survey done by Engineer Valencia, as shown by the presence of petitioner Flaviana Cajayon during the verification survey and setting of

monuments per survey report.[11]

Petitioners filed a motion for new trial and/or reconsideration but it was denied in an Order [12] dated 12 January 1999 of the RTC. They

elevated the case to the Court of Appeals by way of petition for review under Rule 42 of the Rules of Court. On 27 November 2000, the

appellate court rendered a Decision[13] dismissing the petition. Holding that the exclusive jurisdiction to try unlawful detainer cases is vested

with the MeTC, the appellate court ratiocinated, thus:

The complaint in the instant case establishes jurisdictional facts necessary to sustain the action for unlawful detainer and
the remedy it seeks is merely to obtain possession of the controverted lot from respondents. Specifically, it alleges that
sometime on May 21, 1996, petitioners started construction works in the area which intruded into a portion of respondents
property; that the parties eventually agreed to stop the construction subject to the result of a survey to be conducted
thereon; that a survey was conducted in the presence of the parties and a report was submitted by Engr. Valencia on
November 12, 1996, showing an encroachment of about 20.61 square meters of respondents lot including that portion
being used as a right of way for petitioners tenants; that even after the boundaries had been verified, petitioners resumed
the construction on the area; that despite verbal and written demands, the last of which was made on March 20, 1999,
petitioners refused to vacate and surrender the encroached area. Surely, respondents resort to unlawful detainer when
petitioners failed to leave the controverted premises upon demand is in order.[14]

The appellate court also held that the fact that petitioners houses already stood on the controverted lot long before the purchase of the land

by respondents failed to negate the case for ejectment. [15] The appellate court emphasized that prior physical possession is not a

condition sine qua non in unlawful detainer cases. The court likewise sustained the RTC findings on the validity of the verification survey

conducted by Engineer Valencia that petitioners have encroached on a 20.61 square meter portion of respondents lot.

On 5 July 2001, the Court of Appeals issued a Resolution[16] denying petitioners Motion for Reconsideration.

Petitioners now come to us via the present petition, submitting as issues the question of jurisdiction and the weight to be accorded to the

verification survey results.[17]

Petitioners anchor their petition on the court a quos lack of jurisdiction over the instant suit. The averments in the complaint do not make out

a case for ejectment, they claim, as their entry into the disputed lot was not made by force, intimidation, threat, strategy or stealth. Neither

was their possession of the disputed property by virtue of the tolerance of respondents or the latters predecessor-in-interest.

Respondents counter that the jurisdictional elements necessary to maintain an action for unlawful detainer clearly obtain in the case at bar,

namely: (a) after the parties agreed to the conduct of a survey by a government surveyor and after the survey, it was determined that the

structures introduced by herein petitioners have encroached a portion of herein respondents lot; (b) notices to vacate and surrender of

possession of the encroached portion were made to petitioners, the last being on March 20, 1997; and (c) the suit was instituted on April 11,

1997 or within one (1) year from date of last demand.[18]

Respondents also stress that possession of the premises by petitioners took place more than one year before the filing of the

complaint and the absence of an allegation in the complaint that such possession of the disputed portion was merely by virtue of respondents

tolerance does not deprive the lower court of its original and exclusive jurisdiction nor will it negate respondents action for unlawful

detainer.[19]

It is settled that jurisdiction of the court in ejectment cases is determined by the allegations of the complaint and the character of the relief

sought.[20]

The Complaint[21] filed by respondents (plaintiffs therein) alleged these material facts:

2. That defendants and Isagani P. Candelaria were the former co-owners of a certain piece of land located in
Maypajo, Caloocan City containing an area of 260 square meters, more or less, under TCT No. C-10870 issued by the
Register of Deeds of Caloocan City;

3. That on February 1, 1995, said co-owners subdivided this parcel of land by virtue of a Partition Agreement
wherein Lot 6-A, Psd 00-034294, containing an area of 100 square meters, more or less, was given to Isagani P.
Candelaria, while Lot 6-B, Psd 00-034294, containing an area of 160 square meters, more or less, was given to
defendants. A copy of said Partition Agreement is hereto attached as Annex A;

5. That on May 30, 1995, Isagani P. Candelaria sold his share to the herein plaintiffs, including the improvements
thereon, in the sum of P100,000.00, under a Deed of Absolute Sale x x x;

7. That sometime in May 21, 1996, defendants started construction works in the area and intruded
into the lot owned by the plaintiffs causing the latter to protest and report the matter to the barangay
authorities;

8. That on the same day, the parties were summoned to appear before the Barangay Chairman wherein
defendants agreed to stop the construction works, and in a subsequent conference on June 7, 1996, they agreed to defer
the matter pending the result of a survey to be conducted by a government surveyor;

11. That the following day, September 5, 1996, Geodetic Engineer Florentina C. Valencia conducted a survey of the
aforesaid property and placed the concrete monuments thereon in the presence of plaintiffs and defendants;

12. That on November 12, 1996, a verification survey report was submitted by Geodetic Engineer Florentina C.
Valencia together with the survey verification plan xxx;

13. That despite defendants knowledge of the property boundary, and despite repeated serious
objections from plaintiffs, defendants proceeded to construct a seven-door bungalow-type semi-concrete
building, occupying at least 10.18 square meters and another 10.43 square meters for the right of way, thus
encroaching upon at least 20.61 square meters of plaintiffs lot, and further demolishing plaintiffs wall.

20. That despite repeated and continuous demands made by plaintiffs upon defendants, both oral and
written, the last being on March 20, 1997, defendants in manifest bad faith, wanton attitude, and in a
malevolent and oppressive manner and in utter disregard of the property rights of plaintiffs, have failed and
refused, and still fail and refuse to vacate the same up to the present time x x x. [22]
 From the above-quoted allegations taken in tandem with the textbook distinctions between forcible entry and unlawful detainer, it is

clear that the complaint makes out a case for forcible entry, as opposed to unlawful detainer. The distinctions between the two forms of

ejectment suits, are: first, in forcible entry, the plaintiff must prove that he was in prior physical possession of the premises until he was

deprived thereof by the defendant, whereas, in unlawful detainer, the plaintiff need not have been in prior physical possession; second, in

forcible entry, the possession of the land by the defendant is unlawful from the beginning as he acquires possession thereof by force,

intimidation, threat, strategy or stealth, while in unlawful detainer, the possession of the defendant is inceptively lawful but it becomes illegal

by reason of the termination of his right to the possession of the property under his contract with the plaintiff; third, in forcible entry, the law

does not require a previous demand for the defendant to vacate the premises, but in unlawful detainer, the plaintiff must first make such

demand, which is jurisdictional in nature.[23]

Respondents had been in prior physical possession of the property in the concept of owner prior to petitioners intrusion on 21 May

1996. When petitioners encroached upon respondents lot and started construction works thereon the latter was dispossessed of the area

involved. Despite various demands by respondents to vacate, petitioners obstinately refused to do so. Clearly, petitioners entry into the said

property was illegal from the beginning, precluding an action for unlawful detainer.

On the other hand, to establish a case of forcible entry, the complaint must allege that one in physical possession of a land or

building has been deprived of that possession by another through force, intimidation, threat, strategy or stealth.[24] It is not essential,

however, that the complaint should expressly employ the language of the law. It would be sufficient that facts are set up showing that

dispossession took place under said conditions.[25]

The words "by force, intimidation, threat, strategy or stealth" include every situation or condition under which one person can

wrongfully enter upon real property and exclude another, who has had prior possession thereof. To constitute the use of "force" as

contemplated in the above-mentioned provision, the trespasser does not have to institute a state of war. Nor is it even necessary that he use

violence against the person of the party in possession. The act of going on the property and excluding the lawful possessor therefrom

necessarily implies the exertion of force over the property, and this is all that is necessary. [26] In the case at bar, petitioners encroachment

into respondents property in an oppressive and malevolent manner, coupled with their refusal to vacate the premises despite knowledge of

the proper boundaries and heedless of respondents serious objections, indelibly connotes force within the meaning of the law.

Petitioners contend that while they concede they might have intruded on respondents property, the action is barred by prescription

because it was filed more than one (1) year after the occurrence of the alleged intrusion. The contention is baseless. Section 1, Rule 70 of the

Rules of Court allows a plaintiff to bring an action in the proper inferior court for forcible entry or unlawful detainer within one (1) year,

respectively, after such unlawful deprivation or withholding of possession. In forcible entry, the one-year period is counted from the date of

actual entry on the land.[27]

Records show that the ejectment suit was instituted on 11 April 1997. Petitioners actual entry into the property, according to the

complaint, took place on 21 May 1996. Thus, the suit was filed well within the one (1)-year period mandated by law.

As a collateral issue, petitioners claim that they are at least entitled to the rights of a builder in good faith on the premise that they

are not the owners of the property encroached upon.

This contention is not tenable. Good faith consists in the belief of the builder that the land he is building on is his and his ignorance of any

defect or flaw in his title.[28] In the instant case, when the verification survey report came to petitioners knowledge their good faith

ceased. The survey report is a professionals field confirmation of petitioners encroachment of respondents titled property. It is doctrinal in
land registration law that possession of titled property adverse to the registered owner is necessarily tainted with bad faith. Thus, proceeding

with the construction works on the disputed lot despite knowledge of respondents ownership put petitioners in bad faith.

Now, the second issue. Petitioners question the evidentiary weight of the verification survey report. They point out that since the survey was

a unilateral act of respondents, done as it was without their consent, they should not be bound by its findings. [29]

In raising the issue, petitioners are in effect asking this Court to reassess the factual findings of the courts below, a task which is beyond this

Courts domain. Factual matters cannot be raised in a petition for review on certiorari. This Court at this stage is limited to reviewing errors of

law that may have been committed by the lower courts. [30] We find no ample reason to depart from this rule, more so in this case where the

Court of Appeals has affirmed the factual findings of the RTC and the MeTC.

Moreover, there is a presumption that official duty is regularly performed, [31] i.e., government officials who perform them are

clothed with the presumption of regularity,[32] as the courts below pointed out.[33] In this case, the verification survey was conducted by a

government functionary.

Even prescinding from the presumption of regularity, what appears on record is that the verification survey was conducted with the

agreement of both parties and in their presence. That was the finding made by the courts below and affirmed by the appellate court without

any wrinkle.[34]

WHEREFORE, based on the foregoing, this Petition is DENIED and the assailed Decision AFFIRMED. Costs against petitioners. SO ORDERED.
FIL-ESTATE MANAGEMENT INC., MEGATOP G. R. No. 130871
REALTY DEVELOPMENT, INC., PEAKSUN
ENTERPRISES AND EXPORT CORP., ARTURO DY,
AND ELENA DY JAO,

Petitioners,

Promulgated:
- versus -

GEORGE H. TRONO, MA. TERESA TRONO, MA.

VIRGINIA TRONO, JESSE TRONO, MA. CRISTINA February 17, 2006
TRONO, PATRICIA TRONO, MA. DIVINA TRONO,
INOCENCIO TRONO, JR., CARMEN TRONO, AND
ZENAIDA TRONO,

Respondents.

x-----------------------------------------------------------------------------------------x

DECISION

SANDOVAL-GUTIERREZ, J.:

Before us is a petition for review on certiorari[1] assailing the Decision[2] dated May 20, 1997 and Resolution[3] dated September 5,

1997 of the Court of Appeals in CA-G.R. SP No. 40263, Ayala Land, Inc., Fil-estate Management Inc., Megatop Realty Development, Inc.,

Peaksun Enterprises and Export Corp., Arturo E. Dy, and Elena Dy Jao,petitioners, versus Hon. Florentino Alumbres, George H. Trono, Ma.

Teresa Trono, Edgardo Trono, Ma. Virginia Trono, Jesse Trono, Ma. Cristina Trono, Inocencio Trono, Jr., Carmen Trono, and Zenaida

Trono, respondents.

The petition alleges that on November 9, 1994, George, Ma. Teresa, Edgardo, Ma. Virginia, Jesse, Ma. Cristina, Inocencio, Jr.,

Carmen, and Zenaida, all surnamed Trono, herein respondents, filed with the Regional Trial Court, Branch 255, Las Pias City, an application

for registration[4] of a parcel of land, docketed as LRC Case No. M-228. The land is located at Bo. Almanza, Las Pias City, Metro Manila

consisting of 245,536 square meters.

Mr. Salvador L. Oriel, Chief of the Docket Division, Land Registration Authority (LRA), issued a Notice of Initial Hearing, [5] stating,

among others, that:

NOTE: This lot is covered portion of Lot 2271 that which is overlapped by Lot 10, Psu-80886 Lot 2276, that which
is overlapped by Lot 2, Psu-56007 which is also Lot 6, Psu-80886; Lot 2270, portion of that which is overlapped by Lot 7,
Psu-56007 and the whole Lot 8, Psu-56007.

On August 11, 1995, the above-named petitioners filed their opposition to LRC Case No. M-228 alleging that as per Survey Plan Psu-

31086, respondents property partly overlaps their lot. As early as April 28, 1989, this lot was registered in their names under Transfer

Certificate of Title (TCT) No. T-9182 of the Registry of Deeds of Las PiasCity.

Earlier, or on July 25, 1995, Ayala Land, Inc. (Ayala Land) also filed an opposition to respondents application for registration

anchored on the ground that the land applied for overlaps the parcels of land covered by TCT Nos. T-5331, T-41326, T-15644, T-41325, T-

36979, T-36891, and T-36982 registered in its name in the Registry of Deeds, same city.

During the hearing, respondents presented the July 24, 1995 Report of the LRA and the Survey Report of the Land Management

Services, Department of Environment and Natural Resources, showing that the land they sought to register under Plan Psu-31086 overlaps

the property already registered in the names of petitioners.

 Thereafter, petitioners and Ayala Land filed their respective motions to dismiss respondents application for registration on the

ground of lack of jurisdiction. They claimed that since the property was previously Torrens registered in their names, the trial court has no

jurisdiction over the subject matter of the proceedings.

On March 4, 1996, the trial court issued a Resolution denying the motions to dismiss, holding that the Regional Trial Court has

exclusive original jurisdiction over all applications for original registration of title to lands.

Petitioners then filed with the Court of Appeals a petition for certiorari.

On May 20, 1997, the Appellate Court rendered its Decision granting the petition for certiorari, holding that:

The incontrovertibility of a title prevents a land registration court from acquiring jurisdiction over a land that is
applied for registration if that land is already decreed and registered under the Torrens System.

The dispositive portion of the Decision reads:

WHEREFORE, the petition is GRANTED and the assailed Order dated March 4, 1996 (Annex A, Petition) is
ANNULLED and SET ASIDE. Instead, the respondent Judge is directed to DISMISS without prejudice LRC M-228. SO
ORDERED.

Petitioners then filed their motion for partial reconsideration praying that LRC Case No. M-228 be dismissed with prejudice and to

declare that the right of respondents to file any action for reconveyance of the property has prescribed.

Meanwhile, on July 9, 1997, Ayala Land and respondents executed a Compromise Agreement.[6] On July 10, 1997, they filed with

the Court of Appeals a Motion for Judgment Based on Compromise Agreement.

On July 25, 1997, the Court of Appeals rendered an Amendatory Decision, holding that in view of the Compromise Agreement, the

case as between Ayala Land and respondents has become moot and academic.

In a Resolution dated September 5, 1997, the Appellate Court denied petitioners motion for partial reconsideration.

Petitioners then filed the instant petition for review on certiorari ascribing to the Court of Appeals the following errors:

IN REFUSING TO DECLARE THE DISMISSAL OF LRC M-228 TO BE WITH PREJUDICE AND THAT ANY ACTION FOR
RECONVEYANCE TO HAVE LONG AGO PRESCRIBED, THE COURT OF APPEALS DECIDED THE ISSUE NOT IN ACCORD WITH
LAW AND PERTINENT JURISPRUDENCE, IN THAT

I.

HAVING ALREADY FOUND THAT THE LAND WAS TITLED, THE COURT OF APPEALS REFUSAL TO DISMISS THE LAND
REGISTRATION CASE WITH PREJUDICE CONTRAVENES THE DOCTRINES THAT A) DECREES OF REGISTRATION ARE IN
REM, B) TITLED LANDS CANNOT BE DECREED AGAIN AND C) THERE CAN BE NO COLLATERAL ATTACK ON TITLES.

II.

HAVING FOUND THAT THE DECREES FROM WHICH PETITIONERS TITLE IS DERIVED, WERE ISSUED IN 1966, THE COURT
OF APPEALS REFUSAL TO DECLARE AS ALREADY PRESCRIBED, ANY DIRECT ATTACK OR ACTION FOR RECONVEYANCE
CONTRAVENES SECTION 32 OF PD 1529 AND THE DOCTRINES IN CARO VS. COURT OF APPEALS AND SALVATIERRA VS.
COURT OF APPEALS.
 Petitioners contend that the dismissal of a subsequent application for original registration of title already covered by a Torrens title

should be with prejudice; that an action for annulment of title or reconveyance of the property involved has prescribed; and that

respondents application for registration (LRC Case No. M-228) is a collateral attack against petitioners land titles.

In their comment, respondents claim that they were misled by their lawyers and that what they should have filed was a complaint

for nullification of titles instead of an application for registration of land.

The petition is impressed with merit.

The fundamental issue for our resolution is whether the trial court has jurisdiction over respondents application for registration of a

parcel of land.

Section 2 of Presidential Decree (PD) 1529[7] partly provides:

Sec. 2. Nature of registration proceedings; jurisdiction of courts. Judicial proceedings for the registration of lands
throughout the Philippines shall be in rem, and shall be based on the generally accepted principles underlying the Torrens
System.

Courts of First Instance shall have exclusive jurisdiction over all applications for original registration of title to
lands, including improvements and interests therein, and over all petitions filed after original registration of title, with
power to hear and determine all questions arising upon such applications or petitions. x x x

Pursuant to the above provisions, the Regional Trial Court (formerly Court of First Instance) has the authority to act, not only on

applications for original registration of title to land, but also on all petitions filed after the original registration of title. Thus, it has the

authority and power to hear and determine all questions arising from such applications or petitions.[8]

The Court of Appeals, therefore, erred in ruling that the Regional Trial Court, Branch 255, Las Pias City has no jurisdiction over LRC

Case No. M-228 on the ground that the land subject of respondents application for registration was already registered in the Registry of

Deeds of Las Pias City.

Significantly, even respondents themselves admit in their comment on the instant petition that what they should have filed was a

complaint for nullity of petitioners titles.

Likewise, Section 48 of PD 1529 provides:

Sec. 48. Certificate not subject to collateral attack. A certificate of title shall not be subject to collateral attack. It
cannot be altered, modified, or cancelled except in a direct proceeding in accordance with law. (Underscoring ours)

Respondents application for registration of a parcel of land already covered by a Torrens title is actually a collateral attack against

petitioners title not permitted under the principle of indefeasibility of a Torrens title. It is well settled that a Torrens title cannot be collaterally

attacked; the issue on the validity of title, i.e., whether or not it was fraudulently issued, can only be raised in an action expressly instituted

for the purpose.[9] Hence, whether or not respondents have the right to claim title over the property in question is beyond the province of the

instant proceeding. That should be threshed out in a proper action. It has been invariably stated that the real purpose of the Torrens System

is to quiet title to land and to stop forever any question as to its legality. Once a title is registered, the owner may rest secure, without the
necessity of waiting in the portals of the court, or sitting on the mirador su casa to avoid the possibility of losing his land.[10]In Ramos v.

Rodriguez,[11] we held:

It must be noted that petitioners failed to rebut the LRA report and only alleged that the title of the Payatas
Estate was spurious, without offering any proof to substantiate this claim.TCT No. 8816, however, having been issued
under the Torrens System, enjoys the conclusive presumption of validity. As we declared in an earlier case (Reyes and
Nadres vs. Borbon and Director of Lands, 50 Phil. 791), (t)he very purpose of the Torrens system would be destroyed if the
same land may be subsequently brought under a second action for registration. The application for registration of the
petitioners in this case would, under the circumstances, appear to be a collateral attack of TCT No. 8816 which
is not allowed under Section 48 of P.D. 1529. (underscoring ours)

Corollarily, Section 32 of the same law states:

Sec. 32. Review of decree of registration; Innocent purchaser for value. The decree of registration shall not be
reopened or revised by reason of absence, minority, or other disability of any person adversely affected thereby, nor by
any proceeding in any court for reversing judgment, subject, however, to the right of any person, including the
government and the branches thereof, deprived of land or of any estate or interest therein by such adjudication or
confirmation of title obtained by actual fraud, to file in the proper Court of First Instance a petition for reopening
and review of the decree of registration not later than one year from and after the date of the entry of such
decree of registration, but in no case shall such petition be entertained by the court where an innocent purchaser for
value has acquired the land or an interest therein whose rights may be prejudiced. Whenever the phrase innocent
purchaser for value or an equivalent phrase occurs in this Decree, it shall be deemed to include an innocent lessee,
mortgagee, or other encumbrancer for value.

Upon the expiration of said period of one year, the decree of registration and the certificate of title
issued shall become incontrovertible. Any person aggrieved by such decree of registration in any case may pursue his
remedy by action for damages against the applicant or any other person responsible for the fraud. (underscoring ours)

A decree of registration that has become final shall be deemed conclusive not only on the questions actually contested and

determined, but also upon all matters that might be litigated or decided in the land registration proceedings.[12]

As per records of the Registry of Deeds of Las Pias City, TCT No. T-9182[13] was registered in petitioners name as early as April 28,

1989, or five (5) years before the filing of respondents application for registration. Thus, it is too late for them (respondents) to

question petitioners titles considering that the Certificates of Title issued to the latter have become incontrovertible after the lapse of one

year from the decree of registration.

WHEREFORE, the petition is GRANTED. The assailed Decision and Resolution of the Court of Appeals in CA-G.R. SP No. 40263

are REVERSED and SET ASIDE.Respondents application for registration of land in LRC Case No. M-228 pending before the Regional Trial

Court, Branch 255, Las Pias City is ordered DISMISSED with prejudice. SO ORDERED.
REPUBLIC OF THE PHILIPPINES, G.R. No. 134209

Petitioner,

Promulgated:

- versus -

CELESTINA NAGUIAT, January 24, 2006

Respondent.

x-----------------------------------------------------------------------------------x

DECISION

GARCIA, J.:

Before the Court is this petition for review under Rule 45 of the Rules of Court seeking the reversal of the Decision [1] dated May 29,

1998 of the Court of Appeals (CA) in CA-G.R. CV No. 37001 which affirmed an earlier decision[2] of the Regional Trial Court at Iba, Zambales,

Branch 69 in Land Registration Case No. N-25-1.

The decision under review recites the factual backdrop, as follows:

This is an application for registration of title to four (4) parcels of land located in Panan, Botolan, Zambales, more
particularly described in the amended application filed by Celestina Naguiat on 29 December 1989 with the Regional Trial
Court of Zambales, Branch 69. Applicant [herein respondent] alleges, inter alia, that she is the owner of the said parcels of
land having acquired them by purchase from the LID Corporation which likewise acquired the same from Demetria
Calderon, Josefina Moraga and Fausto Monje and their predecessors-in-interest who have been in possession thereof for
more than thirty (30) years; and that to the best of her knowledge, said lots suffer no mortgage or encumbrance of
whatever kind nor is there any person having any interest, legal or equitable, or in possession thereof.

On 29 June 1990, the Republic of the Philippines [herein petitioner]. . . filed an opposition to the application on
the ground that neither the applicant nor her predecessors-in interest have been in open, continuous, exclusive and
notorious possession and occupation of the lands in question since 12 June 1945 or prior thereto; that the muniments of
title and tax payment receipts of applicant do not constitute competent and sufficient evidence of a bona-fide acquisition of
the lands applied for or of his open, continuous, exclusive and notorious possession and occupation thereof in the concept
of (an) owner; that the applicants claim of ownership in fee simple on the basis of Spanish title or grant can no longer be
availed of . . .; and that the parcels of land applied for are part of the public domain belonging to the Republic of the
Philippines not subject to private appropriation.

On 15 October 1990, the lower court issued an order of general default as against the whole world, with the
exception of the Office of the Solicitor General, and proceeded with the hearing of this registration case.

After she had presented and formally offered her evidence . . . applicant rested her case. The Solicitor General,
thru the Provincial Prosecutor, interposed no objection to the admission of the exhibits. Later . . . the Provincial Prosecutor
manifest (sic) that the Government had no evidence to adduce. [3]

In a decision[4] dated September 30, 1991, the trial court rendered judgment for herein respondent Celestina Naguiat, adjudicating

unto her the parcels of land in question and decreeing the registration thereof in her name, thus:

WHEREFORE, premises considered, this Court hereby adjudicates the parcels of land situated in Panan, Botolan,
Zambales, appearing on Plan AP-03-003447 containing an area of 3,131 square meters, appearing on Plan AP-03-003446
containing an area of 15,322 containing an area of 15,387 square meters to herein applicant Celestina T. Naguiat, of legal
age, Filipino citizen, married to Rommel Naguiat and a resident of Angeles City, Pampanga together with all the
improvements existing thereon and orders and decrees registration in her name in accordance with Act No. 496,
Commonwealth Act No. 14, [should be 141] as amended, and Presidential Decree No. 1529. This adjudication, however, is
subject to the various easements/reservations provided for under pertinent laws, presidential decrees and/or presidential
letters of instructions which should be annotated/ projected on the title to be issued. And once this decision becomes final,
let the corresponding decree of registration be immediately issued. (Words in bracket added)

With its motion for reconsideration having been denied by the trial court, petitioner Republic went on appeal to the CA in CA-G.R. CV

No. 37001.

As stated at the outset hereof, the CA, in the herein assailed decision of May 29, 1998, affirmed that of the trial court, to wit:

WHEREFORE, premises considered, the decision appealed from is hereby AFFIRMED.SO ORDERED.
 Hence, the Republics present recourse on its basic submission that the CAs decision is not in accordance with law, jurisprudence and

the evidence, since respondent has not established with the required evidence her title in fee simple or imperfect title in respect of the subject

lots which would warrant their registration under (P.D. 1529 or Public Land Act (C.A.) 141. In particular, petitioner Republic faults the

appellate court on its finding respecting the length of respondents occupation of the property subject of her application for registration and for

not considering the fact that she has not established that the lands in question have been declassified from forest or timber zone to alienable

and disposable property.

Public forest lands or forest reserves, unless declassified and released by positive act of the Government so that they may form part of the

disposable agricultural lands of the public domain, are not capable of private appropriation. [5] As to these assets, the rules on confirmation of

imperfect title do not apply.[6] Given this postulate, the principal issue to be addressed turns on the question of whether or not the areas in

question have ceased to have the status of forest or other inalienable lands of the public domain.

Forests, in the context of both the Public Land Act[7] and the Constitution[8] classifying lands of the public domain into agricultural, forest or

timber, mineral lands and national parks, do not necessarily refer to a large tract of wooded land or an expanse covered by dense growth of

trees and underbrush. As we stated in Heirs of Amunategui [9]-

A forested area classified as forest land of the public domain does not lose such classification simply because loggers or
settlers have stripped it of its forest cover. Parcels of land classified as forest land may actually be covered with grass or
planted to crops by kaingin cultivators or other farmers. Forest lands do not have to be on mountains or in out of the way
places. xxx. The classification is merely descriptive of its legal nature or status and does not have to be descriptive of what
the land actually looks like. xxx

Under Section 2, Article XII of the Constitution,[10] which embodies the Regalian doctrine, all lands of the public domain belong to the State

the source of any asserted right to ownership of land.[11] All lands not appearing to be clearly of private dominion presumptively belong to the

State.[12] Accordingly, public lands not shown to have been reclassified or released as alienable agricultural land or alienated to a private

person by the State remain part of the inalienable public domain.[13] Under Section 6 of the Public Land Act, the prerogative of classifying or

reclassifying lands of the public domain, i.e., from forest or mineral to agricultural and vice versa, belongs to the Executive Branch of the

government and not the court.[14] Needless to stress, the onus to overturn, by incontrovertible evidence, the presumption that the land

subject of an application for registration is alienable or disposable rests with the applicant.[15]

In the present case, the CA assumed that the lands in question are already alienable and disposable. Wrote the appellate court:

The theory of [petitioner] that the properties in question are lands of the public domain cannot be sustained as it is directly against
the above doctrine. Said doctrine is a reaffirmation of the principle established in the earlier cases . . . that open, exclusive
and undisputed possession of alienable public land for period prescribed by law creates the legal fiction whereby the land,
upon completion of the requisite period, ipso jure and without the need of judicial or other sanction, ceases to be public
land and becomes private property . (Word in bracket and underscoring added.)

The principal reason for the appellate courts disposition, finding a registerable title for respondent, is her and her predecessor-in-interests

open, continuous and exclusive occupation of the subject property for more than 30 years. Prescinding from its above assumption and

finding, the appellate court went on to conclude, citing Director of Lands vs. Intermediate Appellate Court (IAC)[16] and Herico vs.

DAR,[17] among other cases, that, upon the completion of the requisite period of possession, the lands in question cease to be public land and

become private property.

Director of Lands, Herico and the other cases cited by the CA are not, however, winning cards for the respondent, for the simple reason that,

in said cases, the disposable and alienable nature of the land sought to be registered was established, or, at least, not put in issue. And there

lies the difference.

Here, respondent never presented the required certification from the proper government agency or official proclamation reclassifying the land

applied for as alienable and disposable. Matters of land classification or reclassification cannot be assumed. It calls for proof.[18] Aside from

tax receipts, respondent submitted in evidence the survey map and technical descriptions of the lands, which, needless to state, provided no
information respecting the classification of the property. As the Court has held, however, these documents are not sufficient to overcome the

presumption that the land sought to be registered forms part of the public domain.[19]

It cannot be overemphasized that unwarranted appropriation of public lands has been a notorious practice resorted to in land registration

cases.[20] For this reason, the Court has made it a point to stress, when appropriate, that declassification of forest and mineral lands, as the

case may be, and their conversion into alienable and disposable lands need an express and positive act from the government.[21]

The foregoing considered, the issue of whether or not respondent and her predecessor-in-interest have been in open, exclusive and

continuous possession of the parcels of land in question is now of little moment. For, unclassified land, as here, cannot be acquired by

adverse occupation or possession; occupation thereof in the concept of owner, however long, cannot ripen into private ownership and be

registered as title.[22]

WHEREFORE, the instant petition is GRANTED and the assailed decision dated May 29, 1998 of the Court of Appeals in CA-G.R. CV

No. 37001 isREVERSED and SET ASIDE. Accordingly, respondents application for original registration of title in Land Registration Case No.

N-25-1 of the Regional Trial Court at Iba, Zambales, Branch 69, is DENIED. No costs. SO ORDERED.
 [G.R. No. 158919. August 9, 2005]

REPUBLIC OF THE PHILIPPINES and CAVITE COLLEGE OF FISHERIES, petitioners, vs. MAXIMA LENSICO, RUFINA LENSICO,
ROGELIO LENSICO and VICTOR LENSICO, respondents.

DECISION

PANGANIBAN, J.:

In denying this Petition, the Court relies on a well-established doctrine. Thus, subject to some exceptions that do not apply here, the
findings of fact of the Court of Appeals affirming those of the trial court cannot be disturbed, modified or reversed by this Court in petitions for
review under Rule 45 of the Rules of Court.

The Case

Before us is a Petition for Review[1] under Rule 45 of the Rules of Court, assailing the June 30, 2003 Decision[2] of the Court of Appeals
(CA) in CA-GR CV No. 46045. The dispositive part of the assailed Decision disposed as follows:

WHEREFORE, except for the award of attorneys fees and costs of suit which are hereby DELETED, the appealed decision is
otherwise AFFIRMED.[3]

The Facts

The facts of the case are narrated by the CA as follows:

x x x. This land was originally a part of the Friar Land known as Lot No. 2833, Fls-644 of the Naic Estate, containing an area of 16,459 square
meters, and was registered on February 4, 1913 under Act No. 496 and issued Original Certificate of Title No. 181. Its then occupant of 34
years, the now deceased Melanio Lensico, on September 8, 1964 filed an Application to Purchase Friar Lands. An investigation was conducted
by Land Investigator Dominador Bayot who found the information contained in the application to be true, and recommended that the lot be
sold at private sale without auction in favor of Melanio Lensico, and gave its appraised value. After drawing three (3) favorable endorsements,
said recommendation was approved. Whereupon Sales Contract No. V-270 was executed between the Bureau of Lands as the vendor and
Melanio Lensico married to Donata Mojica as the vendees who paid the purchase price in full. This sale was acknowledged on August 8, 1968
by the Office of the Secretary of the Department of Agriculture and Natural Resources with Deed No. V-1-0193. Eventually, Transfer
Certificate of Title No. T-78832 was issued on September 8, 1975 in the names of Melanio Lensico and Donata Mojica.

Out of the 16,459 square meters total area of the property, Cavite College occupies a portion of some 11,650. Their squabble began after the
death of the registered owners, their children and heirs namely the litigants Maxima, Rufina, Rogelio and Victor, surnamed Lensico, required
the payment of rentals for the occupancy of the area. Their demands having been ignored, the Lensicos required Cavite College compensation
for occupancy and to either vacate or buy the premises. The Republic of the Philippines on the other hand made moves to cancel the issued
Transfer Certificate of Title. Their disagreements resulted in the filing of Civil Case No. NC-934 and Civil Case No. NC-963.

Civil Case No. NC-934 is a suit styled to be for Recovery of Possession of Property or Payment of Price of Land filed by the Lensicos against
Cavite College. They alleged that they are the legitimate children of the registered owners; that it was only after the death of their parents
when they learned that Cavite College has been occupying a portion of the lot sans payment of rentals; that apart from verbal demands they
also sent three (3) letters to Cavite College but to no avail.

Cavite College admitted the existence of TCT T-78332 but insisted that by its actual occupation since 1961 and the immense improvements it
had introduced, it has a better and superior right to the property. Cavite College traced its right of possession on the following occurrences:
that Congress on June 18, 1960 enacted Republic Act [2]661 which was AN ACT PROVIDING FOR THE ESTABLISHMENT OF A SCHOOL OF
FISHERIES IN THE MUNICIPALITY OF NAIC, PROVINCE OF CAVITE; that pursuant to this, the Naic Municipal Council on August 6, 1961
passed a resolution designated as KAPASIYAHANG IPINAGKAKALOOB SA CAVITE SCHOOL OF FISHERIES ANG MGA SANGAB (FORESHORE
LAND) SIMULA SA NGAYON MGA BAGONG KARSADA (BOUNDARY) HANGGANG SA NAYON NG BUCANA, PARA MAGAMIT SA KANILANG
PAGTUTURO. That after this, Cavite College started to construct its school buildings without objection from the Lensicos or their parents. It
averred that the property in question was mostly an area reclaimed from the sea by the construction of rock groins. Although Cavite College
admitted that the property was covered by a title, it argued that its issuance to the registered owners is null and void because the lot is
actually a part of the foreshore land which is a public domain. The sales application of the registered owners was only on 1964 whereas Cavite
College had been occupying the area since 1961. And that the Information Sheet for the sales application did not disclose the true
improvements on the property because despite the buildings that Cavite College have constructed thereon and which occupies the greater
area, what was reflected as improvements are only the following: one house of strong materials, 1 small nipa hut, 6 coconut trees, and 1
tamarind tree, valued P500.00 Cavite College stressed that with its continued possession and introduction of valuable improvements thereon,
it should be given a superior right to the property because had it not been for the rock groins it constructed, then the whole property which
faces Manila Bay would have been lost to the sea.

Civil Case No. NC-963, on the other hand, is a suit for Annulment of Title and Reversion of Land to the State filed by the Republic of the
Philippines against the Lensicos and the Register of Deeds for the Province of Cavite. Through this action, the Republic of the Philippines
sought the cancellation of TCT No. T-78832 which it claims to be null and void, and that the Lensicos have no vested rights whatsoever on the
property which is part of the foreshore land and could not be titled as private property. According to the Republic of the Philippines, the
particulars given by Melanio Lensico in the Application to Purchase Friar Lands and the Information Sheet were false, and so also was the
recommendation submitted by Land Investigator Dominador Bayot in the Information Sheet because it did not declare as one of the
improvements in the property the school buildings and other developments introduced by Cavite College. That were it not for these false
informations, then there would have been no sale between the Bureau of Lands and Melanio Lensico. In trying to invalidate the issuance of
the TCT, it was argued by the Republic of the Philippines that the Bureau of Lands or the Secretary of Agriculture and Natural Resources had
no jurisdiction or authority to award or sell the said property because this has already been designated by Republic Act 2661 on June 18,
1960 as a site for the establishment of the school of Cavite College.

The Lensicos countered that it was not true that the Cavite College had erected a building on the property as early as 1961 because in 1964
there was as yet no building in the area. To controvert further, they stated that when Congress approved Republic Act 2661 and the Naic
Municipal Council passed its Resolution on August 5, 1961 designating the foreshore land as the school site, the exact location was not yet
determined and it was only later when it was discovered that the Cavite College already encroached on their property that the subject area
was imputed. It was also denied that the property was part of the sea because this had long been dry land and part of the Naic Estate known
as Lot No. 2833, Fls-644 and among its boundaries are Lot Nos. 733 and 2834.
These two cases were consolidated, and on July 5, 1993, the court a quo rendered its judgment, the decretal portion of which reads:

WHEREFORE, this Court passes judgment ordering the defendant in Civil Case No. NC-934 to pay plaintiffs the price of P25.00 per square
meter of the portion of Lot 2833 with an area of 11,650 square meters, or, to pay reasonable rent at the rate of P2,000.00 per month from
the time defendant occupied said premises until December 1999, unless the plaintiffs agreed for an extended period of 30 years thereafter.
Should the defendant fail to comply to the foregoing terms and conditions, it shall vacate the said area occupied within three (3) months from
finality of this Decision, and, to pay the rents thereof at the reasonable rate of P2,000.00 per month from July 1961. Since there appears no
evidence regarding attorneys fees, the defendant is hereby Ordered to pay plaintiffs reasonable sum of attorneys fees ofP20,000.00 plus costs
of suit.[4]

Ruling of the Court of Appeals

The appellate court affirmed the trial courts finding that the subject lot was formerly a friar land and not a part of the public domain.
The CA added that the evidence of respondents was not sufficiently overcome by that presented by petitioners to establish the claim that the
property was foreshore or beach land.[5] It further said that the public nature of the land was dispelled by its registration since February 4,
1913 under Original Certificate of Title (OCT) 181.[6]

The court a quo also debunked petitioners claim that Melanio Lensicos Transfer Certificate of Title (TCT) T-78832 had been fraudulently
obtained. According to the CA, the TCT was granted upon full compliance with the substantive and procedural requirements for its acquisition,
such as the appraisal and investigation by the Bureau of Lands (BL), as well as several endorsements from BL officers. The appellate court
further reasoned that respondents had an indefeasible and conclusive title to the property, by virtue of which the Municipal Council of Naic
had no authority to dispose of any part of the land.[7]

Finally, while affirming the trial courts Order for petitioners either to purchase the property or to pay corresponding rentals, the CA
nonetheless set aside the award for attorneys fees for lack of basis.[8]

Hence, this Petition.[9]

The Issue

Petitioners raise this sole issue for our consideration:

Whether or not the Court of Appeals erred in dismissing petitioners appeal on the ground that the subject property is not part of foreshore
land and that respondents predecessor-in-interest did not commit fraud in securing a certificate of title over the subject property.[10]

Otherwise stated, the issue is whether respondents predecessor was the lawful owner of the parcel of land occupied by petitioner
school.

The Courts Ruling

The Petition has no merit.

Sole Issue:
Ownership of the Subject Premises

Petitioners argue that respondents did not have a valid title to the property, because TCT T-78832 was null and void. They contend that
Lot 2833, the area covered by the title, is foreshore and beach land and, thus, a piece of public property. [11] Consequently, it may not be
alienated or registered, notwithstanding the alleged possession of it by Melanio Lensico for a substantial length of time.[12] They present the
Information Sheet he prepared and two Survey Plans, all describing the property as beach land. That it was mostly so was allegedly revealed,
too, by the trial courts ocular inspection.[13]

To further bolster their position, petitioners allege that it was previously not in existence, because it did not appear in the June 6, 1911
map of the Naic Friar Estate, although it did in the March 25, 1930 survey, which described it as beach land. They also submit pictures taken
by a geodetic engineer of the Bureau of Lands during the relocation survey, illustrating that two corners of the lot adjoined the Manila
Bay.[14] Thus, they conclude that the property is foreshore land.

Foreshore or Friar Lands

On the basis of all these arguments, petitioners ask this Court to set aside the trial and the appellate courts factual finding that the
subject property was not foreshore land.

It must be stressed that only questions of law may be raised in petitions to review decisions of the Court of Appeals filed before this
Court.[15] The factual findings of the CA affirming those of the trial court are final and conclusive. They cannot be reviewed by this Court, save
only in the following circumstances, which we find absent in the instant case: (1) when the factual conclusion is a finding grounded entirely on
speculations, surmises and conjectures; (2) when the inference is manifestly mistaken, absurd or impossible; (3) when there is a grave abuse
of discretion; (4) when the judgment is based on a misapprehension of facts; (5) when the findings of fact are conflicting; (6) when the Court
of Appeals went beyond the issues of the case in making its findings, which are further contrary to the admissions of both the appellant and
the appellee; (7) when the CAs findings are contrary to those of the trial court; (8) when the conclusions do not cite the specific evidence on
which they are based; (9) when the facts set forth in the petition as well as in the petitioners main and reply briefs are not disputed by the
respondents; and (10) when the CAs findings of fact, supposedly premised on the absence of evidence, is contradicted by the evidence on
record.[16]

Petitioners have failed to establish that the present case falls under any of the exceptions enumerated above. A perusal of the facts and
evidence presented does not convince this Court to deviate from the findings of fact of the courts a quo. The lower courts properly
appreciated the evidence submitted by both parties as regards the nature of the property. These courts have determined that the lot was part
of the friar lands that had been titled since 1913; it was not foreshore land.
 Foreshore land has been defined as that which lies between the high and the low water marks, and that is alternately wet and dry
according to the flow of the tide.[17] In other words, it is that strip of land between high and low water, the land left dry by the flux and reflux
of the tides.[18]

In the present case, although corners 3 and 4 of Lot 2833 have been shown to adjoin[19] the sea, they -- let alone the entire Lot 2833 --
have not been proven to be covered by water during high tide. Hence, the property cannot be considered foreshore land.

Fraud in Title Application

Petitioners submit that because TCT No. T-78832 was fraudulently acquired, the principle of indefeasibility of title does not attach to it.
They allege that Melanio Lensico was merely a dummy. Supposedly because he was illiterate, someone else completed the application without
verifying from the former the correctness of the entries made.[20] In that application, the latter allegedly misrepresented Lensico as the actual
occupant of the property at the time. Petitioners, as testified to by their witnesses as well as Rogelio Lensico, had purportedly constructed
several buildings in the area before the application was filed. [21] The alleged misrepresentation is cited as a sufficient ground to nullify the
TCT.[22]

To illustrate an alleged pattern of fraud, petitioners maintain that the application was granted without actual investigation, which no
government employee could have conducted on Saturday and Sunday, the days between September 18, 1964, when the application was
submitted; and September 21, 1964, when the Information Sheet, stating that an investigation had been conducted, was completed. They
further contend that the elder Lensicos description of the lot and the improvements on it were blindly and wholly copied in the Information
Sheet.[23]

Finally, Melanio Lensico purportedly failed to comply with the mandatory requirements of notice (to the municipal president) and
publication, as laid down in Sections 9 and 11 of Act 1120, which governs the disposition of friar lands. [24] Petitioners point out that neither
the school nor the elders in the area were aware of the application.

Whether fraud attended the application for the title is a factual question that revolves purely upon a proper appreciation of the evidence.
For the same reasons stated previously, the findings of the lower courts that petitioners failed to adduce evidence sufficient to establish that
fraud had attended the issuance of the title to Lensico cannot be overturned.

To prove the existence of fraud, petitioners rely on mere allegations unsupported by sufficient evidence. There is no showing that,
although illiterate, Lensico was not informed of the contents of the document he was privy to. Neither is there any evidence to show the
absence of an actual investigation of the property. Petitioners allegation that government employees do not work on weekends, when pitted
against the presumption that official duty has been regularly performed,[25] falls short of the required preponderance of evidence.

Petitioners maintain that Lensico misrepresented himself as the actual occupant of the property at the time of his application to
purchase the land. They insist that respondents could not have been occupying it, because Petitioner Cavite College of Fisheries had already
constructed buildings on 11,650 square meters of it, supposedly since 1961.

Assuming arguendo that the contention of petitioners is true, the existence of those buildings at the time does not preclude the fact that
Lensico could have indeed been the actual occupant of Lot 2833 -- at least, of 4,809 square meters of it. Hence, their mere assertion that
they constructed buildings on a portion of the lot does not preclude the possibility that someone else could have occupied the other portions
of it, and that the latter had been in possession of the entire property prior to their entry. It is worth pointing out that the College was
granted the foreshore land to be used in teaching.[26] However, it ended up occupying the property, which was not foreshore but titled land,
specifically a portion of Lot 2833.

All told, we find no compelling reason to disturb the factual findings of the two lower courts. Petitioners have failed to prove that, in his
application to purchase Lot 2833, Melanio Lensico willfully and knowingly made any false statement that would sufficiently cause the
cancellation of the application and the forfeiture (in favor of the government) of all amounts paid on the land. The validity of TCT T-78322, as
well as its issuance to respondents predecessor, stands.

The predecessor of respondents paid the government for the purchase of the entire 16,459 square meters comprising Lot 2833.
Therefore, it would be just and correct that they be compensated for Petitioner Cavite College of Fisheries use of the portion that belongs to
the Lensicos.

Basis for the Purchase Price

Petitioners theorize that the purchase price of the land should be based on its value at the time it was taken, considering that the
occupied portion consists mainly of areas reclaimed through the efforts and resources of the government. As the College is a public entity that
promotes public welfare, it avers that its interests prevail over respondents private interests.[27]

In expropriation proceedings, the value of the land and its character at the time it was taken by the government are the criteria for
determining just compensation.[28] As noted in Ansaldo v. Tantuico,[29] there are instances when, as in the present case, the expropriating
agency takes over the property prior to the expropriation suit, in which situation just compensation shall be determined as of the time of
taking. Commissioner of Public Highways v. Burgos[30] held that the price of the land when it was taken, not its value after the passage of
time, represents the true value to be paid as just compensation. Hence, the value of the property upon its actual taking, subject of course to
interest accruing from that time, should be the basis of the purchase price if Petitioner Cavite College of Fisheries opts to buy the property.

In the present case, the trial court has already determined that the just compensation for the taking of the subject portion of
respondents land is the selling price of P25 per square meter or rent of P2,000 per month. The justness of this determination, which was
affirmed by the CA, is not seriously assailed by petitioners. Again, we find no compelling reason to disturb this finding, as it is factual in
nature.

WHEREFORE, the Petition is DENIED, and the assailed Decision AFFIRMED. No pronouncement as to costs. SO ORDERED.
SPS. TEODULO RUMARATE, (deceased) and ROSITA RUMARATE; G.R. No. 168222
deceased TEODULO RUMARATE is represented herein by his Heirs/Substitutes,
namely, ANASTACIA RUMARATE, CELSO RUMARATE, MARINA
RUMARATE, ROMEO RUMARATE, GUILLERMO RUMARATE, FIDEL
RUMARATE, MERLINDA RUMARATE, MARISSA RUMARATE, CLEMENCIA
RUMARATE, SANCHO RUMARATE and NENITA RUMARATE,
Petitioners,

- versus -

HILARIO HERNANDEZ, JOAQUIN HERNANDEZ, SALVADOR HERNANDEZ, BENJAMIN HERNANDEZ, LEONORA HERNANDEZ-LAZA,
VICTORIA HERNANDEZ-MERCURIO, RODRIGO HERNANDEZ, BERNARDO HERNANDEZ, LOURDES HERNANDEZ-CABIDA, MARIO
SALVATIERRA, ADELAIDA FONTILA-CIPRIANO, and THE REGISTER OF DEEDS OF QUEZON PROVINCE,

Respondents. Promulgated:

April 18, 2006

x ---------------------------------------------------------------------------------------- x

DECISION
YNARES-SANTIAGO, J.:

Assailed in this petition for review is the May 26, 2005 Decision [1] of the Court of Appeals in CA-G.R. CV No. 57053, which reversed and set

aside the March 31, 1997 Decision[2] of the Regional Trial Court of Calauag, Quezon, Branch 63, in Civil Case No. C-964, declaring petitioners

as owners of Lot No. 379 with an area of 187,765 square meters and located in Barrio Catimo, [3] Municipality of Guinayangan, Province of

Quezon.

The facts show that on September 1, 1992, petitioner spouses Teodulo Rumarate (Teodulo) and Rosita Rumarate filed an action for

reconveyance of real property and/or quieting of title with damages against respondent heirs of the late spouses Cipriano Hernandez and Julia

Zoleta.[4] Teodulo averred that Lot No. 379 was previously possessed and cultivated by his godfather, Santiago Guerrero (Santiago), a

bachelor, who used to live with the Rumarate family in San Pablo City. Between 1923 and 1924, Santiago and the Rumarate family

transferred residence to avail of the land distribution in Catimo, Guinayangan, Quezon. From 1925 to 1928, Santiago occupied Lot No. 379

cultivating five hectares thereof. Before moving to Kagakag, Lopez, Quezon in 1929, Santiago orally bequeathed his rights over Lot No. 379

to Teodulo and entrusted to him a copy of a Decision of the Court of First Instance (CFI) of Tayabas dated April 21, 1925 recognizing his

(Santiago) rights over Lot No. 379.[5] Since Teodulo was only 14 years old then, his father helped him cultivate the land. [6] Their family

thereafter cleared the land, built a house[7] and planted coconut trees, corn, palay and vegetables thereon.[8] In 1960, Santiago executed an

Affidavit (quit-claim)[9] ratifying the transfer of his rights over Lot No. 379 to Teodulo. Between 1960 and 1970, three conflagrations razed the

land reducing the number of coconut trees growing therein to only 400, but by the time Teodulo testified in 1992, the remaining portions of

the land was almost entirely cultivated and planted with coconuts, coffee, jackfruits, mangoes and vegetables. [10] From 1929, Teodulo and

later, his wife and 11 children possessed the land as owners and declared the same for taxation, the earliest being in 1961. [11]

In 1970, Teodulo discovered that spouses Cipriano Hernandez and Julia Zoleta, respondents predecessors-in-interest, were able to obtain a

title over Lot No. 379. He did not immediately file a case against respondents because he was advised to just remain on the land and pay the

corresponding taxes thereon.[12]

Respondents, on the other hand, claimed that on November 11, 1964, Santiago sold the questioned lot to their parents, the spouses Cipriano

Hernandez and Julia Zoleta, for P9,000.00.[13] Respondents alleged that on April 21, 1925, the CFI of Tayabas rendered a Decision written in

Spanish, declaring Lot No. 379 as a public land and recognizing Santiago as claimant thereof in Cadastral Proceeding No. 12. However, no

title was issued to Santiago because he failed to file an Answer. Spouses Cipriano Hernandez and Julia Zoleta filed a motion to re-open

Cadastral Proceeding No. 12, alleging that though no title was issued in the name of Santiago, the same decision is, nevertheless, proof that

Santiago was in possession of Lot No. 379 since 1925 or for more than 30 years. Having succeeded in the rights of Santiago, the spouses

prayed that Cadastral Proceeding No. 12 be re-opened and that the corresponding title over Lot No. 379 be issued in their name. On

September 13, 1965, the CFI of Tayabas rendered a decision adjudicating Lot No. 379 in favor of the spouses, in whose name Original
Certificate of Title (OCT) No. O-11844[14] was issued on the same date.[15] Cipriano Hernandez planted coconut trees on the land through the

help of a certain Fredo[16] who was instituted as caretaker. In 1970, Fredo informed Cipriano Hernandez that he will no longer stay on the

land because there are people instructing him to discontinue tilling the same.[17]

After the death of the spouses,[18] respondents executed a deed of partition over the subject lot and were issued TCT No. T- 237330

on June 28, 1988 in lieu of OCT No. O-11844.[19]

Respondent Joaquin Hernandez (Joaquin) testified that in 1964, he accompanied his father in inspecting the lot which was then planted with

coconut trees.[20] Thereafter, he visited the land twice, once in 1966 and the other in 1970. From 1966 up to the time he testified, his family

declared the lot for taxation and paid the taxes due thereon. [21]Joaquin explained that after the death of his father in 1971, he no longer

visited the land and it was only when the complaint was filed against them when he learned that petitioners are in actual possession of the

property.[22] He added that his siblings had planned to convert Lot No. 379 into a grazing land for cattle but decided to put it off for fear of the

rampant operations then of the New Peoples Army between the years 1965-1970.[23]

On March 31, 1997, the trial court rendered a decision in favor of petitioners. It held that since the latter possessed the land in the concept of

an owner since 1929, they became the owners thereof by acquisitive prescription after the lapse of 10 years, pursuant to the Code of Civil

Procedure. Thus, when Santiago sold the lot to respondents parents in 1964, the former no longer had the right over the property and

therefore transmitted no title to said respondents. The dispositive portion of the trial courts decision, reads:

WHEREFORE, in the light of all the foregoing considerations judgment is hereby rendered in favor of the plaintiffs
and against the defendants, to wit:

1. Declaring that the parcel of land (Lot No. 379 of the Cadastral Survey of Guinayangan, Cadastral Case No. 12,
LRC Cadastral Record No. 557), situated in Brgy. Katimo, Tagkawayan, Quezon had been fraudulently, deceitfully and
mistakenly registered in the names of the spouses Cipriano Hernandez and Julia Zoleta;

2. Declaring that herein defendants [heirs] of spouses Cipriano Hernandez and Julia Zoleta have no better rights
than their parents/predecessors-in-interest, they having stepped only on (sic) their shoes;

3. Declaring that the plaintiff Rosita Victor Rumarate and substitute plaintiffs-[heirs] of the deceased Teodulo
Rumarate are the true, real and legal owners/or the owners in fee simple absolute of the above described parcel of land;

4. Ordering the defendants to convey the above-described parcel of land to plaintiff Rosita Victor Rumarate and
to the substitute plaintiffs (heirs) of the deceased Teodulo Rumarate;

5. Ordering the Register of Deeds for Quezon Province in Lucena City to cancel Transfer Certificate of Title No. T-
237330 and to issue in lieu thereof a new certificate of title in favor of plaintiff Rosita Victor Rumarate and the substitute
plaintiffs (heirs) of the deceased plaintiff Teodulo Rumarate, in accordance with law and settled jurisprudence; and

6. Ordering the defendants to pay the costs of the suit. SO ORDERED.[24]

Respondents appealed to the Court of Appeals which on May 26, 2005, reversed and set aside the decision of the trial court. It ruled

that Teodulo did not acquire title over Lot No. 379, either by donation or acquisitive prescription; that Teodulos bare allegation that Santiago

orally bequeathed to him the litigated lot is insufficient to prove such transfer of ownership; and that even assuming that the property was

truly donated by Santiago to Teodulo in 1929, or in the 1960 Affidavit, said conveyance is void for not complying with the formalities of a

valid donation which require the donation and the acceptance thereof by the donee to be embodied in a public instrument. Both requirements,

however, are absent in this case because in 1929, the alleged donation was not reduced to writing while the purported 1960 donation was

never accepted in a public document by Teodulo. The appellate court thus surmised that since it was not established that Santiago donated

Lot No. 379 to Teodulo, it follows that the latter also failed to prove that he possessed the land adversely, exclusively and in the concept of an

owner, a vital requisite before one may acquire title by acquisitive prescription. In conclusion, the Court of Appeals ruled that even assuming

further that Teodulo had a right over the property, his cause of action is now barred by laches because he filed an action only in 1992

notwithstanding knowledge as early as 1970 of the issuance of title in the name of spouses Cipriano Hernandez and Julia Zoleta. The decretal

portion of the decision states:

 WHEREFORE, premises considered, the instant appeal is GRANTED. The assailed March 31, 1997 decision of the
Regional Trial Court of Calauag, Quezon, Branch 63, in Civil Case No. C-964 is hereby REVERSED and SET ASIDE. No
costs. SO ORDERED.[25]

Hence, the instant appeal.

The issue to be resolved is to whom should Lot No. 379 be awarded? To petitioners who possessed and cultivated the lot since 1929 up to the

present, but do not have a certificate of title over the property, or to respondents who have a certificate of title but are not in possession of

the controverted lot?

In an action for quieting of title, the court is tasked to determine the respective rights of the parties so that the complainant and those

claiming under him may be forever free from any danger of hostile claim.[26] Under Article 476[27] of the Civil Code, the remedy may be

availed of only when, by reason of any instrument, record, claim, encumbrance or proceeding, which appears valid but is, in fact, invalid,

ineffective, voidable or unenforceable, a cloud is thereby cast on the complainants title to real property or any interest therein. Article 477 of

the same Code states that the plaintiff must have legal or equitable title to, or interest in the real property which is the subject matter of the

suit.

For an action to quiet title to prosper, two indispensable requisites must concur, namely: (1) the plaintiff or complainant has a legal

or an equitable title to or interest in the real property subject of the action; and (2) the deed, claim, encumbrance or proceeding claimed to

be casting cloud on his title must be shown to be in fact invalid or inoperative despite its prima facie appearance of validity or legal

efficacy.[28]

In Evangelista v. Santiago,[29] it was held that title to real property refers to that upon which ownership is based. It is the evidence

of the right of the owner or the extent of his interest, by which means he can maintain control and, as a rule, assert a right to exclusive

possession and enjoyment of the property.

In the instant case, we find that Teodulos open, continuous, exclusive, notorious possession and occupation of Lot No. 379, in the

concept of an owner for more than 30 years vested him and his heirs title over the said lot. The law applicable at the time Teodulo completed

his 30-year possession (from 1929 to 1959) of Lot No. 379, in the concept of an owner was Sec. 48(b) of Commonwealth Act No. 141 or the

Public Land Act, as amended by Republic Act (RA) No. 1942, effective June 22, 1957[30] which provides:

Sec. 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 (now Regional Trial Courts) of the province where the land is located for confirmation of their claims and
the issuance of a certificate of title thereafter, under the Land Registration Act (now Property Registration Decree), to wit:

(b) Those who by themselves or through their predecessors-in-interest have been, in continuous, exclusive, and
notorious possession and occupation of agricultural lands of the public domain, under a bona fide claim of acquisition or
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. Those 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.

When the conditions specified therein are complied with, the possessor is deemed to have acquired, by operation of law, a right to a

government grant, without necessity of a certificate of title being issued, and the land ceases to be part of the public domain. The

confirmation proceedings would, in truth be little more than a formality, at the most limited to ascertaining whether the possession claimed is

of the required character and length of time; and registration thereunder would not confer title, but simply recognize a title already

vested. The proceedings would not originally convert the land from public to private land, but only confirm such conversion already effected

by operation of law from the moment the required period of possession became complete. [31]
 In the instant case, the trial court gave full faith and credence to the testimony of Teodulo and his witnesses that his (Teodulos)

possession of the land since 1929 was open, continuous, adverse, exclusive, and in the concept of an owner. It is a settled rule in civil cases

as well as in criminal cases that in the matter of credibility of witnesses, the findings of the trial courts are given great weight and highest

degree of respect by the appellate court considering that the latter is in a better position to decide the question, having heard the witnesses

themselves and observed their deportment and manner of testifying during the trial.[32]

A careful examination of the evidence on record shows that Teodulo possessed and occupied Lot No. 379 in the concept of an

owner. Since 1929, Teodulo cultivated the controverted land, built his home, and raised his 11 children thereon. In 1957, he filed a

homestead application over Lot No. 379 but failed to pursue the same.[33] After his demise, all his 11 children, the youngest being 28 years

old,[34] continued to till the land. From 1929 to 1960, Santiago never challenged Teodulos possession of Lot No. 379 nor demanded or

received the produce of said land. For 31 years Santiago never exercised any act of ownership over Lot No. 379. And, in 1960, he confirmed

that he is no longer interested in asserting any right over the land by executing in favor of Teodulo a quitclaim.

Indeed, all these prove that Teodulo possessed and cultivated the land as owner thereof since 1929. While the oral donation in 1929

as well as the 1960 quitclaim ceding Lot No. 379 to Teodulo are void for non-compliance with the formalities of donation, they nevertheless

explain Teodulo and his familys long years of occupation and cultivation of said lot and the nature of their possession thereof.

In Bautista v. Poblete,[35] the Court sustained the registration of a parcel of land in the name of the successors-in-interest of the

donee notwithstanding the invalidity of the donation inasmuch as said donee possessed the property in the concept of an owner. Thus:

There is no question that the donation in question is invalid because it involves an immovable property and the
donation was not made in a public document as required by Article 633 of the old Civil Code, in connection with Article
1328 of the same Code (concerning gifts propter nuptias), but it does not follow that said donation may not serve as basis
of acquisitive prescription when on the strength thereof the donee has taken possession of the property adversely and in
the concept of owner.

It follows therefore that Teodulos open, continuous, exclusive, and notorious possession and occupation of Lot No. 379 for 30 years,

or from 1929 to 1959 in the concept of an owner, earned him title over the lot in accordance with Sec. 48 (b) of the Public Land

Act. Considering that Lot No. 379 became the private property of Teodulo in 1959, Santiago had no more right to sell the same to spouses

Cipriano Hernandez and Julia Zoleta in 1964. Consequently, the latter and herein respondents did not acquire ownership over Lot No. 379 and

the titles issued in their name are void.

Interestingly, respondents adopted the theory that Santiago acquired title over Lot No. 379 not from the April 21, 1925 Decision of

the CFI of Tayabas which merely recognized his rights over said lot, but from his more than 30 years of possession since 1925 up to 1964

when he sold same lot to their (respondents) predecessors-in-interest, the spouses Cipriano Hernandez and Julia Zoleta. On the basis of said

claim, said spouses filed an action for, and successfully obtained, confirmation of imperfect title over Lot No. 379, pursuant to Sec. 48 (b) of

the Public Land Act.

However, the records do not support the argument of respondents that Santiagos alleged possession and cultivation of Lot No. 379

is in the nature contemplated by the Public Land Act which requires more than constructive possession and casual cultivation. As explained by

the Court in Director of Lands v. Intermediate Appellate Court:[36]

 It must be underscored that 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 effect of constructive possession. Taken together with the words open, continuous,
exclusive and notorious, the word occupation serves to highlight the fact that for one to qualify under paragraph (b) of the
aforesaid section, his possession of the land must not be mere fiction. As this Court stated, through then Mr. Justice Jose
P. Laurel, in Lasam vs. The Director of Lands:

x x x Counsel for the applicant invokes the doctrine laid down by us in Ramos vs. Director of
Lands (39 Phil. 175, 180). (See also Rosales vs. Director of Lands, 51 Phil. 302, 304). But it should be
observed that the application of the doctrine of constructive possession in that case is subject to certain
qualifications, and this court was careful to observe that among these qualifications is one particularly
relating to the size of the tract in controversy with reference to the portion actually in possession of the
claimant.While, therefore, possession in the eyes of the law does not mean that a man has to have his
feet on every square meter of ground before it can be said that he is in possession, possession under
paragraph 6 of section 54 of Act No. 926, as amended by paragraph (b) of section 45 of Act No. 2874,
is not gained by mere nominal claim. The mere planting of a sign or symbol of possession cannot justify
a Magellan-like claim of dominion over an immense tract of territory. Possession as a means of
acquiring ownership, while it may be constructive, is not a mere fiction x x x.

Earlier, in Ramirez vs. The Director of Lands, this Court noted:

x x x The mere fact of declaring uncultivated land for taxation purposes and visiting it every
once in a while, as was done by him, does not constitute acts of possession.

In the instant case, Santiagos short-lived possession and cultivation of Lot No. 379 could not vest him title. While he tilled the land

in 1925, he ceased to possess and cultivate the same since 1928. He abandoned the property and allowed Teodulo to exercise all acts of

ownership. His brief possession of Lot No. 379 could not thus vest him title.Nemo potest plus juris ad alium transferre quam ipse habet. No

one can transfer a greater right to another than he himself has. Hence, spouses Cipriano Hernandez and Julia Zoleta and herein respondents

did not acquire any right over the questioned lot and the title issued in their names are void, because of the legal truism that the spring

cannot rise higher than the source.[37]

Furthermore, spouses Cipriano Hernandez and Julia Zoleta cannot be considered as purchasers in good faith because they had

knowledge of facts and circumstances that would impel a reasonably cautious man to make such inquiry. [38] The Court notes that Santiago

was not residing in Lot No. 379 at the time of the sale. He was already 81 years old, too old to cultivate and maintain an 18-hectare

land. These circumstances should have prompted the spouses to further inquire who was actually tilling the land. Had they done so, they

would have found that Teodulo and his family are the ones possessing and cultivating the land as owners thereof.

In the same vein, respondents could not be considered as third persons or purchasers in good faith and for value or those who buy

the property and pay a full and fair price for the same[39] because they merely inherited Lot No. 379 from spouses Cipriano Hernandez and

Julia Zoleta.

Then too, even if Santiago acquired title over Lot No. 379 by virtue of the April 21, 1925 Decision of the CFI of Tayabas, and not on

account of his alleged 30-year possession thereof, we will still arrive at the same conclusion. This is so because the declaration of this Court

that petitioners are the rightful owners of the controverted lot is based on Teodulos own possession and occupation of said lot under a bona

fide claim of acquisition of ownership, regardless of the manner by which Santiago acquired ownership over same lot.

On the issue of prescription, the settled rule is that an action for quieting of title is imprescriptible, as in the instant case, where the

person seeking relief is in possession of the disputed property. A person in actual possession of a piece of land under claim of ownership may

wait until his possession is disturbed or his title is attacked before taking steps to vindicate his right, and that his undisturbed possession

gives him the continuing right to seek the aid of a court of equity to ascertain and determine the nature of the adverse claim of a third party

and its effect on his title.[40] Considering that petitioners herein continuously possessed Lot No. 379 since 1929 up to the present, their right

to institute a suit to clear the cloud over their title cannot be barred by the statute of limitations.
 Neither could petitioners action be barred by laches because they continuously enjoyed the possession of the land and harvested the

fruits thereof up to the present to the exclusion of and without any interference from respondents. They cannot therefore be said to have

slept on their rights as they in fact exercised the same by continuously possessing Lot No. 379.

On the contrary, we find that it is respondents who are actually guilty of laches. Though not specifically pleaded, the Court can

properly address the issue of laches based on petitioners allegation in the complaint that [n]either spouses Cipriano Hernandez and Julia

Zoleta x x x nor [herein respondents] had taken steps to possess or lay adverse claim to said parcel of land from the date of their registration

of title in November, 1965 up to the present.[41] Such averment is sufficient to impute abandonment of right on the part of respondents. At

any rate, laches need not be specifically pleaded. On its own initiative, a court may consider it in determining the rights of the parties.[42]

The failure or neglect, for an unreasonable length of time to do that which by exercising due diligence could or should have been

done earlier constitutes laches. It is negligence or omission to assert a right within a reasonable time, warranting a presumption that the

party entitled to assert it has either abandoned it or declined to assert it. While it is by express provision of law that no title to registered land

in derogation of that of the registered owner shall be acquired by prescription or adverse possession, it is likewise an enshrined rule that even

a registered owner may be barred from recovering possession of property by virtue of laches.[43]

In applying the doctrine of laches, we have ruled that where a party allows the following number of years to lapse from the

emergence of his cause of action without enforcing his claim, laches sets in: 36 years; 12 years; 50 years; 34 years; 37 years; 32 years; 20

years; 47 years; 11 years; 25 years; 40 years; 19 years; 27 years; 7 years; 44 years; 4 years; and 67 years. [44]

The elements of laches are: (1) conduct of a party on the basis of which the other party seeks a remedy; (2) delay in asserting ones

rights, despite having had knowledge or notice of the other partys conduct and having been afforded an opportunity to institute a suit; (3)

lack of knowledge or notice on the part of a party that the person against whom laches is imputed would assert the right; and (4) injury or

prejudice to the party asserting laches in the event the suit is allowed to prosper.[45]

All these elements are present in this case. Petitioners continuous possession and occupation of Lot No. 379 should have prompted

the respondents to file an action against petitioners, but they chose not to. Respondents cannot deny knowledge of said possession by

petitioners as they even asserted in their Answer that in 1970, Teodulo ousted the tenant they (respondents) instituted in the lot. From 1970

up to the filing of petitioners complaint in 1992, or after 22 years, respondents never bothered to assert any right over Lot No.

379. Respondent Joaquin Hernandez testified that he and his siblings had a plan to convert the land into a grazing land for cattle but decided

to put it off for fear of the rampant operations of the New Peoples Army between the years 1965-1970. However, even after said years,

respondents took no step to implement their plan. Worse, among the siblings of spouses Cipriano Hernandez and Julia Zoleta who are all

living in the Philippines,[46] only Joaquin Hernandez visited the land and only thrice, i.e., once in each years of 1964, 1966 and

1970. Thereafter, not one of them paid visit to Lot No. 379, up to the time Joaquin Hernandez testified in 1996,[47] despite the fact that two of

them are living only in Calauag, Quezon; one in Agdangan, Quezon; [48] and two in Lucena City.[49] Neither did they send a notice or

correspondence to petitioners invoking their right over the property. From all indications, the late spouses Cipriano Hernandez and Julia

Zoleta as well respondents, have neglected Lot No. 379. Were it not for this action instituted by petitioners in 1992, their conflicting claims

over the property could not have been settled. It goes without saying that to lose a property that has been in the family from 1929 up to the

present, or for 77 years will certainly cause irreparable pecuniary and moral injury to petitioners, especially so if the same ancestral land will

be lost under most unfair circumstances in favor of respondents who appear to have no real interest in cultivating the same.
 Finally, payment of taxes alone will not save the day for respondents. Only a positive and categorical assertion of their supposed

rights against petitioners would rule out the application of laches. It means taking the offensive by instituting legal means to wrest possession

of the property which, however, is absent in this case. Respondents payment of taxes alone, without possession could hardly be construed as

an exercise of ownership. What stands out is their overwhelming passivity by allowing petitioners to exercise acts of ownership and to enjoy

the fruits of the litigated lot for 22 years without any interference.

In sum, the Court finds that Lot No. 379 should be adjudicated in favor of petitioners.

One last point. Notwithstanding this Courts declaration that Lot No. 379 should be awarded in favor of petitioners, their title over the

same is imperfect and is still subject to the filing of the proper application for confirmation of title under Section 48 (b) of the Public Land Act,

where the State and other oppositors may be given the chance to be heard. It was therefore premature for the trial court to direct the

Register of Deeds of Lucena City to issue a certificate of title in the name of petitioners.

Nevertheless, the imperfect title of petitioners over Lot No. 379 is enough to defeat the certificate of title issued to respondents.[50]

WHEREFORE, the petition is GRANTED and the May 26, 2005 Decision of the Court of Appeals in C.A. GR. CV No. 57053,

is REVERSED and SET ASIDE. The March 31, 1997 Decision of the Regional Trial Court of Calauag, Quezon, Branch 63, in Civil Case No. C-

964, awarding Lot No. 379 in favor petitioners and ordering the cancellation of respondents Transfer Certificate of Title No. T- 237330,

is REINSTATED with the MODIFICATION deleting the trial courts order directing the Register of Deed of Lucena City to issue a certificate of

title in the name of petitioners. SO ORDERED.

THE GOVERNMENT OF THE G.R. No. 147212
PHILIPPINES, represented by
THE DIRECTOR OF LANDS,
Petitioner,

- versus –

VICTORIANO ABALLE, ET AL,

Claimants,

REPUBLIC OF THE PHILS.,

Petitioner,
Promulgated:
- versus -

SALVADOR WEE,
Respondent. March 24, 2006
x------------------------------------------------x
DECISION

AUSTRIA-MARTINEZ, J.:

Petitioner filed the present Petition for Review under Rule 45 of the Rules of Court, assailing the Decision [1] dated February 14,
2001 rendered by the Court of Appeals (CA) in CA-G.R. CV No. 62477. The CA Decision affirmed the Order dated June 24, 1998 issued by the
Regional Trial Court of Zamboanga City (RTC) in Cadastral Case No. 96-1 for Judicial Reconstitution of Original Certificate of Title No. 0-
10046.

Respondent Salvador Wee (Wee) filed Cadastral Case No. 96-1 on January 2, 1996, seeking the judicial reconstitution of Original
Certificate of Title No. 0-10046. The petition alleged: (1) Pursuant to an Extra-Judicial Settlement of Estate with Sale, Wee acquired from the
heirs of Francisco Rivera the parcel of land subject of the petition, particularly described as follows:

A PARCEL OF LAND (Lot No. 4093 of the Cadastral Survey of Zamboanga City), with the improvements thereon,
situated in the Municipality of Zamboanga. Bounded on the NE. by Lot No. 4094 and vecinal Road to Capisan; on the SE.
by the Vecinal Road to Capisan; on the SW. by Lot No. 3303; and on the NW. by Lot No. 4105. Containing an area of Sixty
Five Thousand Nine Hundred and twenty six (65,926) Square Meters, covered by Original Certificate of Title No. 0-10046
issued by the Register of Deeds of Zamboanga City.

(2) the copy of the Original Certificate of Title No. 0-10046 was lost and/or destroyed, as evidenced by the certification issued by the Register

of Deeds of Zamboanga City, pursuant to Decree No. 199154 on December 11, 1925; (3) the property was declared by Francisco Rivera for

taxation purposes under Tax Declaration No. 0-01-23-00046, and Wee is in actual possession of the property; (4) no co-owners, mortgagees

or lessees duplicate copy of the certificate of title has been issued; (5) the property is free from all liens and encumbrances and there is no

pending claim or suit against the property; (6) no deed or other instrument adversely affecting the ownership of the property has been

presented for registration in the Register of Deeds of Zamboanga City; and (7) the owners of the adjoining properties are Candido M. Cruz

(Lot No. 4094 & road), Anastacio Atilano (Lot No. 3303) and Rufo Francisco (Lot No. 4105).[2]

The Office of the Solicitor General (OSG) appeared as Oppositor in behalf of the Government of the Philippines and authorized the City

Prosecutor of Zamboanga City to likewise appear in its behalf.[3]

On June 26, 1997, a Notice of Hearing for October 3, 1997 was posted in the Sheriffs Bulletin Board, the City Hall, and the public market, all

in Zamboanga City.[4] The notice was also published in the Official Gazette on August 25, 1997 and September 1, 1997.[5]

On June 24, 1998, the RTC issued its Order allowing reconstitution of Original Certificate of Title No. 0-10046. The dispositive portion of the

Order reads:

WHEREFORE, upon payment of all the prescribed fees and taxes, the Register of Deeds of Zamboanga City is
hereby ordered to reconstitute Original Certificate of Title No. 0-10046, covering Lot No. 4093 of the Cadastral Survey of
Zamboanga, with the improvements thereon, situated in the Municipality of Zamboanga, with an area of 65,926 square
meters, more or less, and registered in the name of Francisco Rivero, married to Catalina Padua, of Zamboanga, Province
of Zamboanga P.I., as the owner in fee simple thereof based on Decree No. 199154 (Exh.G), pursuant to Section 2 of
Republic Act No. 26. SO ORDERED.[6]
Petitioner appealed the RTC Order to the CA on the sole ground that the trial court erred in ordering the reconstitution considering

respondents (Wee) failure to comply with the jurisdictional requisites therefor.[7] Petitioner argued that the RTC did not acquire jurisdiction

over the case due to Wees failure to comply with the requirement of notice to the adjoining owners, inasmuch as the Notice of Hearing was

merely published and posted, but not furnished to the propertys adjoining owners.[8]

The CA dismissed petitioners appeal and affirmed the RTCs Order in its assailed Decision dated February 14, 2001, [9] ruling that Wee had

satisfactorily complied with the requirements laid down in Section 13 of Republic Act No. 26.

Hence, the present petition.

Petitioner reiterates its argument that the trial court did not acquire jurisdiction over the case for non-compliance with the

jurisdictional requirements set in Section 13 of R.A. No. 26.

A review of the records of this case shows that the petition is meritorious.

R.A. No. 26 provides for the procedure and requirements in the reconstitution of lost or destroyed Torrens Certificates of

Title. Section 10, in relation to Section 9, of R.A. No. 26 specifically lays down the requirements for sources enumerated in Sections 2(a),

2(b), 3(a), 3(b), and 4(a) of R.A. No. 26; on the other hand, Sections 12 and 13 of R.A. No. 26 provide for the requirements for sources

enumerated in Sections 2(c), 2(d), 2(e), 2(f), 3(c), 3(d), 3(e), and 3(f) of R.A. No. 26. [10]

The reconstitution proceedings before the RTC was based on Decree No. 199154 issued on December 11, 1925 from which Original

Certificate of Title No. 0-10046 was issued on January 25, 1926; hence, it falls under Section 2(d) of R.A. No. 26, or reconstitution from an

authenticated copy of the decree of registration, pursuant to which the original title was issued. The applicable provisions, therefore, are

Sections 12 and 13 of R.A. No. 26, to wit:

SEC. 12. Petitions for reconstitution from sources enumerated in sections 2(c), 2(d), 2(e), 2(f), 3(c), 3(d), 3(e),
and/or 3(f) of this Act, shall be filed with the proper Court of First Instance, by the registered owner, his assigns, or any
person having an interest in the property. The petition shall state or contain, among other things, the following: (a) that
the owners duplicate of the certificate of title had been lost or destroyed; (b) that no co-owners, mortgagees or lessees
duplicate had been issued, or, if any had been issued, the same had been lost or destroyed; (c) the location, area and
boundaries of the property; (d) the nature and description of the buildings or improvements, if any, which do not belong to
the owner of the land, and the names and addresses of the owners of such buildings or improvements; (e) the names and
addresses of the occupants or persons in possession of the property, of the owners of the adjoining properties and of all
persons who may have any interest in the property; (f) a detailed description of the encumbrances, if any, affecting the
property; and (g) a statement that no deeds or other instruments affecting the property had been presented for
registration, or if there be any, the registration thereof has not been accomplished, as yet. All the documents, or
authenticated copies thereof, to be introduced in evidence in support of the petition for reconstitution shall be attached
thereto and filed with the same: Provided, That in case the reconstitution is to be made exclusively from sources
enumerated in section 2(f) or 3(f) of this Act, the petition shall be further accompanied with a plan and technical
description of the property duly approved by the Chief of the General Land Registration Office (now Commission of Land
Registration), or with a certified copy of the description taken from a prior certificate of title covering the same property.

SEC. 13. The court shall cause a notice of the petition, filed under the preceding section, to be published, at the
expense of the petitioner, twice in successive issues of the Official Gazette, and to be posted on the main entrance of the
provincial building and of the municipal building of the municipality or city in which the land is situated, at least thirty days
prior to the date of hearing. The court shall likewise cause a copy of the notice to be sent, by registered mail or otherwise,
at the expense of the petitioner, to every person named therein whose address is known, at least thirty days prior to the
date of hearing. Said notice shall state, among other things, the number of the lost or destroyed certificate of title, if
known, the name of the registered owner, the names of the occupants or persons in possession of the property, the
owners of the adjoining properties and all other interested parties, the location, area and boundaries of the property, and
the date on which all persons having any interest therein must appear and file their claim or objections to the petition. The
petitioner shall, at the hearing, submit proof of the publication, posting and service of the notice as directed by the court.

Under the foregoing provisions, it was incumbent upon Wee to prove compliance with the following jurisdictional requirements:

1. [That] the notice of the petition must be published, at the expense of the petitioner, twice in successive issues
of the Official Gazette, and posted on the main entrance of the provincial building and of the municipal building of the
municipality or city in which the land is situated, at least thirty days prior to the date of hearing;

2. [That] the notice state among other things, the number of the lost or destroyed certificates of title if known,
the name of the registered owner, the name of the occupants or persons in possession of the property, the owner of the
 adjoining properties and all other interested parties, the location, area and boundaries of the property, and the date on
which all persons having any interest therein must appear and file their claim of objection to the petition;

3. [That] a copy of the notice also be sent, by registered mail or otherwise, at the expense of the petitioner, to
every person named therein (i.e. the occupants or persons in possession of the property, the owner of the adjoining
properties and all other interested parties) whose address is known at least thirty days prior to the date of the hearing;
and

4. [That] at the hearing, petitioner submits proof of publication, posting and service of the notice as directed by
the court.[11] (Emphasis supplied)

Jurisprudence dictates that these requirements must be complied with before the court can act on the petition and grant the

reconstitution of title prayed for.[12]Specifically, the requirement of actual notice to the occupants and the owners of the adjoining property is

itself mandatory to vest jurisdiction upon the court in a petition for reconstitution of title, and essential in order to allow said court to take the

case on its merits. The non-observance of the requirement invalidates the whole reconstitution proceedings in the trial court.[13]

In this case, there is no showing that there were notices of hearing sent to the owners of the adjoining properties. As ordered by the

RTC in the Notice of Hearing datedJune 23, 1997, copies of the notice were ordered sent to all adjacent owners and all persons named in the

petition.[14] Wee maintains that these notices were sent to the adjacent owners through registered mail. However, there is nothing in the

records of this case that will prove service of these notices. It should be emphasized that Section 13 of R.A. No. 26 unequivocally requires a

petitioner in a reconstitution proceeding to submit proof of notice.

On this score, Rule 13, Section 13 of the Rules of Court explicitly provides:

SEC. 13. Proof of Service. x x x. If service is made by registered mail, proof shall be made by such affidavit and
the registry receipt issued by the mailing office. The registry return card shall be filed immediately upon its receipt by
the sender, or in lieu thereof the unclaimed letter together with the certified or sworn copy of the notice given by the
postmaster to the addressee.

When service of notice is an issue, the rule is that the person alleging that the notice was served must prove the fact of service. The

burden of proving notice rests upon the party asserting its existence. In civil cases, service made through registered mail is proved by

the registry receipt issued by the mailing office and an affidavit of the person mailing.[15] Absent one or the other, or worse both, there is no

proof of service.[16] In Petition for Habeas Corpus of Benjamin Vergara v. Gedorio, Jr., the Court held that:

When service of notice is an issue, the rule is that the person alleging that the notice was served must prove the
fact of service. The burden of proving notice rests upon the party asserting its existence. In civil cases, service made
through registered mail is proved by the registry receipt issued by the mailing office and an affidavit of the person mailing
of facts showing compliance with Section 7 of Rule 13. In the present case, as proof that petitioners were served with
copies of the omnibus motion submitting an inventory of the estate of deceased Allers, respondent Bolao presented
photocopies of the motion with a certification by counsel that service was made by registered mail, together with the
registry receipts. While the affidavit and the registry receipts proved that petitioners were served with copies of the
motion, it does not follow, however, that petitioners in fact received the motion. Respondent Bolao failed to present the
registry return cards showing that petitioners actually received the motion. Receipts for registered letters and return
receipts do not prove themselves, they must be properly authenticated in order to serve as proof of receipt of the letters.
Respondent also failed to present a certification of the postmaster that notice was duly issued and delivered to petitioners
such that service by registered mail may be deemed completed.[17]

Wee asserts that the registry return receipts are attached to the records of this case. It must be stressed, however, that the registry

receipts alone are not sufficient to prove that notice was made to the adjoining owners. The law clearly states that it is the registry receipt

issued by the mailing office and the affidavit of the person mailing, which proves service made through registered mail.

Moreover, the Court notes that the registry receipts were not even marked as exhibits so that it may be considered as part of the

records of the case. In Vda. de Oate v. Court of Appeals,[18] the Court had the occasion to rule that for evidence to be considered, the same

must be formally offered, and that while a document has been identified and marked as an exhibit, it does not automatically mean that it has

already been offered as part of the evidence of a party.[19] It was also stated in the Oate case that the foregoing rule may be relaxed,

provided that the evidence have been duly identified by testimony duly recorded, and the same must have been incorporated in the records
of the case.[20]There is nothing in the testimony of Wee that will show that these registry receipts were duly identified as those that were

issued by the mailing office relative to the posting of the notice of hearing via registered mail to the adjoining owners.[21]

Substantial compliance with the jurisdictional requirements laid down in Sections 12 and 13 of R.A. No. 26 is not enough; the trial

courts acquisition of jurisdiction over the reconstitution case is hinged on a strict compliance with the requirements of the law.[22] It must be

stressed that the purposes of the stringent and mandatory character of the legal requirements of publication, posting and mailing are to

safeguard against spurious and unfounded land ownership claims, to apprise all interested parties of the existence of such action, and to give

them enough time to intervene in the proceeding.[23]

Where the authority to proceed is conferred by a statute and the manner of obtaining jurisdiction is mandatory, the same must be

strictly complied with, or the proceedings will be utterly void. As such, the court upon which the petition for reconstitution of title is filed is

duty-bound to examine thoroughly the petition for reconstitution of title and review the record and the legal provisions laying down the

germane jurisdictional requirements.[24]

In view of Wees failure to adequately prove that notices of hearing were sent to the adjoining owners of the property subject of the

reconstitution case, the RTC, therefore, did not acquire jurisdiction over the case, and any proceedings held thereon are null and void.

WHEREFORE, the petition is GRANTED. The Decision dated February 14, 2001 rendered by the Court of Appeals in CA-G.R. CV No.

62477 is REVERSED and SET ASIDE. Cadastral Case No. 96-1 for Judicial Reconstitution of Original Certificate of Title No. 0-10046

is DISMISSED for lack of jurisdiction. SO ORDERED.

PLANTERS DEVELOPMENT G.R. No. 147081

BANK,

Petitioner,

-versus–

FRANCISCO GARCIA,

Respondent.

Promulgated: December 9, 2005

x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - x

DECISION
CORONA, J.:

This is a petition for review on certiorari under Rule 45 of the Rules of Court, assailing the decision of the Court of Appeals (CA) in CA-G.R. SP

No. 51801[1] dated November 20, 2000 which dismissed the petition of Planters Development Bank (PDB) and affirmed in toto the decision of

the Department of Agrarian Reform Adjudication Board Appeal Board (DARAB Appeal Board) dated February 23, 1999, [2] as well as the CAs

resolution dated February 15, 2001 which denied petitioners motion for reconsideration.

This case involves a parcel of land located in Sto. Cristo, San Antonio, Nueva Ecija with an area of 35,916 square meters.

Respondent alleged that he had been an agricultural lessee on said parcel of land since 1936. This land was covered by Transfer Certificate of

Title (TCT) No. T-1847, with the spouses Jose Cruz and Braulia Ortiz as the registered owners.

On November 16, 1976, the spouses sold the land to their grandson, Lorenzo Bautista. TCT No. NT-147561 was then issued in his

name. Bautista mortgaged the land in favor of PDB to secure a loan on March 2, 1977. For failure to pay the loan, PDB foreclosed on the

mortgage and bought the property in a public auction.[3] The certificate of sale and the affidavit of consolidation of ownership were registered

on July 11, 1979 and September 25, 1984 respectively.[4] On the latter date, PDB was also issued TCT No. NT-185020. Thereafter, PDB sold

the land to spouses Marciano Ramirez and Erlinda Camacho on July 30, 1986.[5]

Respondent Francisco Garcia (Garcia) filed a petition for redemption before the DARAB-Region III in Cabanatuan City on January 17,

1994.[6]The petition was originally against PDB only but in Garcias amended petition, he impleaded the spouses Marciano Ramirez and Erlinda

Camacho as additional respondents. He alleged that as an agricultural lessee, he was a holder of Certificate of Land Transfer (CLT) No. 0-

089665 issued on May 26, 1982. He prayed that he be allowed to redeem the land.

The Provincial Adjudicator of DARAB-Cabanatuan City dismissed the petition. On appeal, however, the decision was reversed and set

aside by the DARAB Appeal Board in Quezon City:

WHEREFORE, premises considered, the assailed Decision dated February 28, 1995 is hereby REVERSED and SET
ASIDE and a new one entered as follows:

1. Affirming the coverage of the land in question under Operation Land Transfer pursuant to
P.D. No. 27;

Declaring the sale and transfer of the subject property under OLT coverage to respondent-appellee Bank
as null and void ab initio for lack of legal and factual basis;
 2. Directing the respondent-appellee Bank to turn-over the questioned landholding to
petitioner-appellant;

3. Directing the MARO of San Antonio, Nueva Ecija to facilitate the generation of the necessary Emancipation
Patent (E.P.) pursuant to the pertinent laws and guidelines.[7]

PDB elevated the case to the CA which affirmed in toto the decision of the DARAB Appeal Board. Hence this petition.

The main issues before us are as follows:

1) whether or not Garcia was an agricultural lessee of the predecessors of PDB under Presidential Decree No. 27
(PD 27);
2) whether or not the transfer of the subject land to PDB was valid and
3) whether Garcia can redeem the land under Section 12 of Republic Act No. 3844 (RA 3844), as amended by
RA 6389.

The land subject of this case is covered by Operation Land Transfer (OLT) pursuant to PD 27[8] which laid down a system for the

purchase by small farmers of the lands they tilled. Landowners of agricultural lands which were devoted primarily to rice and corn and

exceeded the minimum retention area were compelled to sell their lands to qualified farmers at liberal terms and conditions through the

intercession of the government. A qualified tenant farmer was then issued a CLT.[9]

On the first issue, PDB insists that the existence of a tenancy relationship between Garcia and Braulia Ortiz Cruz was never raised as

an issue by Garcia because the latter only dwelt on his right of redemption. [10] However, in resolving the issue of the right of redemption, the

question of tenancy must first be resolved. The existence or non-existence of a tenancy relationship was a question of fact resolved by the

DARAB-Cabanatuan City against Garcia but decided in his favor by the DARAB Appeal Board and the CA. The CA held that:

On the outset, it should be borne in mind that whether the respondent was indeed a tenant or laborer is a
question of fact. In this regard, jurisprudence has provided the following requisites for tenancy relationship: (1)
the parties are the landowner and the tenant; (2) the subject is agricultural land; (3) there is consent; (4) the
purpose is agricultural production; (5) there is personal cultivation; and (6) there is sharing of harvests. All
these must concur to establish the juridical relationship of tenancy.

There is no better and eloquent proof of the existence of the tenancy relationship between the respondent and
Braulia Ortiz than the issuance in the formers favor of CLT No. 0-089665 over the subject parcel of land. Obviously, the
afore-enumerated requisites have been met; otherwise, the said CLT could not have been issued.[11](Emphasis supplied)

The decision of the DARAB Appeal Board, as affirmed in toto by the CA, in turn had these findings of fact:

As gleaned from the records of the case, there is no denying the fact that petitioner-appellant has farmed and
cultivated the land in question since 1936 with the permission of Braulia Ortiz Cruz who was the registered owner of the
questioned property xxx

Sometime in December 1974, however, then landowner Braulia Ortiz Cruz entered into a written leasehold
contract entitled Kasunduan sa Buwisan sa Sakahan (sic) (Annex C) evidencing petitioners status as de jure
tenant/agricultural lessee of the land in question.

With the promulgation of Presidential Decree No. 27 decreeing the emancipation of the tenant-farmer from the
bondage of the soil, petitioner-appellant was identified by the DAR Office concerned as a qualified farmer-beneficiary under
the Operation Land Transfer (OLT) program of the government, such that the latter was a recipient of Certificate of Land
Transfer No. 0-089665 dated May 26, 1982 covering the subject property.[12]

PDB, however, argues that there was nothing to show that the property covered by the CLT was the same property subject of this

case. The CA merely assumed that these were the same.[13]

It is true that CLT No. 0-089665[14] issued in the name of Garcia merely mentions that it pertained to Lot No. 00147 located in Sto.

Cristo, San Antonio, Nueva Ecija. However, a document entitled Kasunduan sa Buwis ng Sakahan was executed by Braulia Ortiz Cruz and

Francisco Garcia pertaining to Lot No. 487-A, the same lot covered by TCT No. T-1874 registered in the name of Braulia Ortiz and Jose R.
Cruz which was transferred to Lorenzo Bautista and then to PDB. This document evidenced the leasehold tenancy relationship between Garcia

and Ortiz Cruz,[15] and carried the essential requisites of such relationship:

1. Ortiz Cruz was the landowner and Garcia was the tenant;

2. the subject land was agricultural;

3. the parties consented to this agreement;

4. Garcia was obligated to cultivate the same by planting rice thereon;

5. the purpose was agricultural production and

6. there was sharing of harvests between the parties.[16]

In addition to the Kasunduan, there was also a certification from the Ministry of Agrarian Reform-Region III[17] certifying that Garcia

was the recipient of CLT No. 0-089665 and specifying Braulia Ortiz as landowner. Lastly, there was the handwritten certification of the

barangay captain of Sto. Cristo, San Antonio, Nueva Ecija[18] which specified, among others, that Braulia Ortiz was the landowner of the land

cultivated by Garcia.[19]

PDB contends that the affidavits of the previous owners (Ortiz Cruz and Bautista) that the subject land was not tenanted, which

affidavits were annotated on the certificate of title, should be believed over the documents submitted by Garcia. This contention is untenable.

As we ruled in Nisnisan, et al. v. Court of Appeals, et al.: [20]

While there are annotations in Gavino Nisnisan's certificate of title (Entry No. 72086 for Affidavit of Non-
Tenancy under Justice Circular No. 31 and Entry No. 117718 for Affidavit of Non-Tenancy executed by Gavino Nisnisan)
that the subject land is not tenanted, said annotations are not conclusive proof of the real relationship between
Gavino Nisnisan and petitioner Policarpio Nisnisan and are not binding upon the court. As we have ruled in Cuao
vs. Court of Appeals:

"We believe and so hold that such annotation cannot be regarded as conclusive upon the
courts of justice as to the legal nature and incidents of the relationship between the landowner(s) in this
case and private respondents. Firstly, the annotation serves basically as notice to all persons of the
existence of the Certification issued by Mr. Eugenio Bernardo, but neither adds to the validity or
correctness of that certification nor converts a defective and invalid instrument into a valid one as
between the parties. Secondly, the certification issued by Mr. Eugenio Bernardo of the MAR (Ministry of
Agrarian Reform) is very much like the certifications issued by the Secretary of Agrarian Reform and
other officials of the Ministry and later the Department of Agrarian Reform concerning the existence of
tenancy relationships in respect of agricultural lands from which persons, who claim to be tenants, are
sought to be ejected. It is well settled that the findings of or certifications issued by the Secretary of
Agrarian Reform, or his authorized representative, in a given locality concerning the presence or
absence of a tenancy relationship between the contending parties are merely preliminary or provisional
and not binding upon the courts.`"

While it is true that certifications by officials of the Department of Agrarian Reform (DAR), like the certification submitted by Garcia,

are not necessarily conclusive on the courts, all of the evidence on record, taken as a whole, can be considered as ample proof that Garcias

CLT referred to the land subject of this case and that Garcia was the tenant or agricultural lessee of Braulia Ortiz Cruz therein. As stated by

the DARAB Appeal Board, with respect to the adjudication of agrarian cases, disputes or controversies, the degree of proof or evidence

necessary to prove ones cause is only substantial evidence.[22] Accordingly, we will not disturb the factual finding of the CA and DARAB Appeal

Board that Garcia was the agricultural lessee of the subject land, considering that it was supported by substantial evidence.
 On the second issue, PDB argues that it was a mortgagee in good faith, hence it acquired the subject land validly. This contention

has merit.

Well-settled is the rule that persons dealing with property covered by a Torrens Certificate of Title may rely on the face of the

certificate. As a rule, they are not required to go beyond what appears therein. Good faith is likewise presumed. [23] Garcia failed to show that

PDB acquired the property in bad faith. We thus hold that PDB was a mortgagee in good faith and acquired the subject land validly.

However, Garcia, as tenant or agricultural lessee, enjoys certain legal rights under RA 3844, otherwise known as the

Agricultural Land Reform Code.[24] Section 10 of this law provides that the existence of an agricultural leasehold relationship is not terminated

by changes in ownership in case of sale or transfer of legal possession (as in lease):

Sec. 10. Agricultural Leasehold Relation Not Extinguished By Expiration of Period, etc. - The agricultural leasehold
relation under this Code shall not be extinguished by mere expiration of the term or period in a leasehold contract nor by
the sale, alienation or transfer of the legal possession of the landholding. In case the agricultural lessor sells,
alienates or transfers the legal possession of the landholding, the purchaser or transferee thereof shall be
subrogated to the rights and substituted to the obligations of the agricultural lessor.

This doctrine is well-settled in jurisprudence. [25]

Thus, when PDB became the absolute owner of the subject land, it was subrogated to the rights and obligations of its predecessors,

Jose Cruz, Braulia Ortiz Cruz and Lorenzo Bautista as agricultural lessors. The tenancy relationship was not affected by the transfer of the

ownership of the landholding.[26] The new owner was bound to respect and maintain the tenants landholding because the tenancy right

attached to the land regardless of who its owner may be.[27] The purpose of the law is to strengthen the security of tenure of the tenants:

in case of transfer or in case of lease, as in the instant case, the tenancy relationship between the landowner and
his tenant should be preserved in order to insure the well-being of the tenant or protect him from being unjustly
dispossessed by the transferee or purchaser of the land; in other words, the purpose of the law in question is to maintain
the tenants in the peaceful possession and cultivation of the land or afford them protection against unjustified dismissal
from their holdings.[28]

We therefore conclude that it was error for the CA to declare the sale and transfer of the subject property to the bank as null and

void ab initio. The transfer to PDB was valid but subject to the rights of Garcia as tenant. As we ruled in the recent case of Milestone Realty

and Co., Inc. v. Court of Appeals: [29]

(W)e are unable to agree with the ruling of respondent Court of Appeals and of DARAB that the sale of the land in
question should be declared null and void. There is no legal basis for such declaration. Lest it be forgotten, it is Carolina
Zacarias who is the owner of the subject land and both Emilio Pea and Delia Razon Pea only succeeded to the tenancy
rights of Anacleto.

As an owner, Carolina has the right to dispose of the property without other limitations than those established by
law. This attribute of ownership is impliedly recognized in Sections 10, 11 and 12 of Republic Act No. 3844, where the law
allows the agricultural lessor to sell the landholding, with or without the knowledge of the agricultural lessee and at the
same time recognizes the right of preemption and redemption of the agricultural lessee. Thus, the existence of tenancy
rights of agricultural lessee cannot affect nor derogate from the right of the agricultural lessor as owner to
dispose of the property. The only right of the agricultural lessee or his successor in interest is the right of
preemption and/or redemption.

In the case at bar, it is undisputed that Carolina became the absolute owner of the subject landholding by virtue
of Deed of Extrajudicial Settlement and Affidavit of Settlement executed by the other heirs of Alfonso Olympia and Spouses
Claro and Cristina Zacarias. As the owner, it is within her right to execute a deed of sale of said landholding, without
prejudice however to the tenancy rights and the right of redemption of Delia Razon Pea. In Manuel, we held that the
tenancy relationship is not affected or severed by the change of ownership. The new owner is under the obligation to
respect and maintain the tenant's landholding. In turn, Delia Razon Pea, as the successor tenant, has the legal right
of redemption. This right of redemption is statutory in character. It attaches to a particular landholding by operation of
law. (Emphasis supplied)
 Consequently, we are also unable to agree with the CA when it affirmed the DARAB Appeal Boards ruling directing (PDB) to turn-

over the questioned landholding to (Garcia).[30] According to the CA, once a CLT has been issued to a tenant covering the property under the

supervision of and in compliance with (the) implementing rules and regulations of the DAR, he is thereby deemed to be the owner of the

agricultural land in question.[31] The DARAB Appeal Board, on the other hand, reasoned:

Succinctly put, areas covered by OLT pursuant to P.D. 27 are beyond the commerce of man. The Honorable
Supreme Court has squarely ruled on this issue by ruling in this wise:

The law is clear and leaves no room for doubt. Upon the promulgation of Presidential Decree
No. 27 on October 21, 1972, petitioner was DEEMED OWNER of the land in question.[32]

It is true that in past decisions of this Court, in particular Torres v. Ventura[33] (which was cited by the DARAB Appeal Board)

and Quiban v. Butalid[34] (which was relied upon by the CA), we held that a tenant issued a CLT is deemed the owner of the land. This is

because PD 27 states that (t)he tenant farmer, whether in land classified as landed estate or not, shall be deemed owner of a portion

constituting a family-size farm of five (5) hectares if not irrigated and three (3) hectares if irrigated.

But, as correctly argued by PDB, more current decisions of this Court (where the interpretation of the phrase deemed owner was

directly tackled) have clarified these pronouncements by distinguishing the legal effects of a CLT and those of an emancipation

patent. Martillano v. Court of Appeals [35] is instructive:

Both instruments have varying legal effects and implications insofar as the grantees entitlements to his landholdings. A
certificate of land transfer merely evinces that the grantee thereof is qualified to, in the words of Pagtalunan, avail of the
statutory mechanisms for the acquisition of ownership of the land tilled by him as provided under Pres. Decree No. 27. It is
not a muniment of title that vests upon the farmer/grantee absolute ownership of his tillage. On the other hand, an
emancipation patent, while it presupposes that the grantee thereof shall have already complied with all the requirements
prescribed under Presidential Decree No. 27, serves as a basis for the issuance of a transfer certificate of title. It is the
issuance of this emancipation patent that conclusively entitles the farmer/grantee of the rights of absolute
ownership. Pagtalunan distinctly recognizes this point when it said that:

It is the emancipation patent which constitutes conclusive authority for the issuance of an
Original Certificate of Transfer, or a Transfer Certificate of Title, in the name of the grantee . . .

Clearly, it is only after compliance with the above conditions which entitle a farmer/grantee to
an emancipation patent that he acquires the vested right of absolute ownership in the landholding a
right which has become fixed and established, and is no longer open to doubt or controversy. At best,
the farmer/grantee, prior to compliance with these conditions, merely possesses a contingent or
expectant right of ownership over the landholding. (Citations omitted)[36]

Given that Garcia is a holder of a CLT but not of an emancipation patent, full ownership of the land has not yet vested in him.

Hence, there is no basis for the CA and DARAB Appeal Board to direct the bank to turn over the land to him.

We are aware that in another recent case, Heirs of Guillermo A. Batongbacal v. Court of Appeals,[37] we ruled that transfer of

ownership of land covered by PD 27 is allowed only in favor of actual tenants and the sale to a third party is null and void:

Department Memorandum Circular No. 8, series of 1974, implementing P.D. 27, provides:

4. No act shall be done to undermine or subvert the intent and provisions of Presidential Decrees, Letters of
Instructions, Memoranda and Directives, such as the following and/or similar acts:

f.) Transferring ownership of tenanted rice and/or corn lands after October 21, 1972, except to
the actual tenant-farmers or tillers but in strict conformity with the provisions of Presidential
Decree No. 27 and the requirements of the Department of Agrarian Reform . . .
 In other words, transfer of ownership over tenanted rice and/or corn lands after October 21, 1972 is allowed only
in favor of the actual tenant-tillers thereon. Hence, the sale executed by Philbanking on January 11, 1985 in favor of
petitioner was in violation of the aforequoted provision of P.D. 27 and its implementing guidelines, and must thus be
declared null and void.[38]

Nevertheless, we maintain that there is nothing in PD 27 which declares any sale or transfer as null and void ab initio when the sale

is done by the agricultural lessor after its enactment. Section 12[39] of RA 3844, as amended by RA 6389, provides the remedy of

redemption[40] to the agricultural lessee when the land is sold, with or without his knowledge.

This leads us to the question of whether or not the period for the exercise of Garcias right to redeem had already lapsed when he invoked it

on January 17, 1994.

Section 12 of RA 3844[41] before its amendment provided that:

Sec. 12. Lessees Right of Redemption. In case the landholding is sold to a third person without the knowledge of
the agricultural lessee, the latter shall have the right to redeem the same at a reasonable price and consideration.
Provided, That the entire landholding sold must be redeemed: Provided, further, that where there are two or more
agricultural lessees, each shall be entitled to said right of redemption only to the extent of the area actually cultivated by
him. The right of redemption under this Section may be exercised within two (2) years from the registration of
the sale and shall have priority over any other right of legal redemption. (Emphasis supplied)

As amended by RA 6389,[42] it now provides that:

Sec. 12. Lessee's Right of Redemption. In case the landholding is sold to a third person without the knowledge of
the agricultural lessee, the latter shall have the right to redeem the same at a reasonable price and consideration:
Provided, That where there are two or more agricultural lessees, each shall be entitled to said right of redemption only to
the extent of the area actually cultivated by him. The right of redemption under this Section may be exercised
within one hundred eighty days from notice in writing which shall be served by the vendee on all lessees
affected and the Department of Agrarian Reform upon the registration of the sale, and shall have priority over
any other right of legal redemption. The redemption price shall be the reasonable price of the land at the time of the sale.

PDB asserts that the registration of the certificate of sale and affidavit of consolidation of ownership in its favor should be considered as

sufficient notice since registration constitutes notice to the whole world.[43] We do not agree. To emphasize, the law is worded this way:

The right of redemption under this Section may be exercised within one hundred eighty days from notice in
writing which shall be served by the vendee on all lessees affected and the Department of Agrarian Reform upon the
registration of the sale xxx

It is clear from the above provision that the 180-day period must be counted from notice in writing. This notice in writing shall

be served by the vendee on all the lessees affected and the DAR upon the registration of the sale. Obviously, notice in writing does not

contemplate registrationotherwise registration would not have been specified separately from notice in writing. If a statute is clear, plain and

free from ambiguity, it must be given its literal meaning and applied without attempted interpretation. [44]

This is consistent with our conclusion in the very recent case Springsun Management Systems Corporation v. Camerino[45] wherein we

affirmed the decision of the trial court:

The only evidence of defendants (now petitioners) shows that the former owner, Victoria Homes, Inc., sold the
lands covered by TCT Nos. (289237) S-6135 and (289236) S-35855 to defendant Springsun Management Systems
Corporation on February 9, 1983 in the amount of P7,223,799.00 (Exh. 4). The sale was made without notifying the
lessees affected and the Department of Agrarian Reform as mandated by Section 12 of R.A. 3844 despite the
fact that the Deed of Sale was duly registered with the Register of Deeds on April 11, 1983 that cancelled the
titles in the name of Victoria Homes, Inc. and TCT Nos. 120542 and 120541 were issued on the same date in
the name of defendant Springsun.
 Similarly, when Victoria Homes, Inc. sold its land described in TCT No. S-72244 to defendant Springsun on
July 12, 1983 in the amount of P2,566,813.00 (Exh.5), no notice was ever sent either to the plaintiffs or to the
Department of Agrarian Reform, notwithstanding that the Deed of Sale was registered on July 29, 1983 that
resulted in the cancellation of TCT No. S-72244 in the name of Victoria Homes, Inc. and a new title bearing No. 123872
was issued to defendant Springsun.

In view of the absence of the notice to the plaintiffs and to the Department of Agrarian Reform as required by
law, the inevitable conclusion is that the plaintiffs are entitled to redeem the subject lands from the defendants
Springsun.[46]

PDB nonetheless maintains that the summons received by Garcia in the action for issuance of writ of possession filed [47] in 1984 by

PDB in RTC-Branch 36, Gapan, Nueva Ecija was effectively a notice in writing as required by law because the petition attached to the

summons alleged, among others, the mortgage, foreclosure and sale of the subject property and PDBs consolidation of ownership.[48] This is

correct.

In Quio v. Court of Appeals, [49] we ruled that:

The purpose of the written notice required by law is to remove all uncertainties as to the sale, its terms and its
validity, and to quiet any doubts that the alienation is not definitive. The law does not prescribe any particular form of
notice, nor any distinctive method for notifying the redemptioner. So long as the redemptioner is informed in writing of the
sale and the particulars thereof, the period for redemption will start running. The letter received by petitioner, being bare,
was not such written notice. It failed to make certain the terms, particulars and validity of the sale.[50]

Garcia admits that he came to know of the alienation of the subject property only when he received the summons from (the RTC)in

1984 and that immediately thereafter, (he) filed a complaint for recognition of tenancy (in) 1985. [51] He also received a copy of the petition

along with the summons.[52] It is fair to conclude therefore that Garcia did not entertain doubts about the transfer to PDB and that he

received the notice in writing prescribed by law considering that (t)he law does not prescribe any particular form of notice, nor any distinctive

method for notifying the redemptioner.[53] As a result, when Garcia filed his petition for redemption in 1994, his right to redeem had already

prescribed.

As to whether or not there was service of notice to the DAR, we also agree with PDB that this question of fact cannot be raised for the first

time on appeal.[54]

In sum, we hold that private respondent Garcia is a bona fide and de jure agricultural lessee or tenant of the landholding subject of this case.

Petitioner PDB, however, acquired the property in good faith and was subrogated to the rights and obligations of the previous agricultural

lessors. Consequently, PDB and its successors, spouses Marciano Ramirez and Erlinda Camacho, were obliged to maintain Garcia in peaceful

possession and cultivation of the land. Finally, considering that Garcia was notified in writing of the transfer to PDB in 1984 but filed his

petition for redemption only in 1994, his right of redemption had already prescribed.

WHEREFORE, the Court hereby PARTIALLY GRANTS the petition for review on certiorari and REVERSES the decision of the Court

of Appeals in so far as it affirmed the decision of the DARAB Appeal Board declaring the sale to petitioner as null and void and directing the

petitioner to turn over the landholding to respondent. The Court orders the dismissal of the petition for redemption filed with the DARAB,

Region III, Cabanatuan City. However, this is without prejudice to the right of respondent to continue as agricultural lessee in peaceful

possession and enjoyment of the land tenanted by him. No costs. SO ORDERED.