G.R. No. 155076 February 27, 2006 line/number.
line/number. In the process, the calls bypass the IGF found at the
LUIS MARCOS P. LAUREL, Petitioner,
vs.
HON. ZEUS C. ABROGAR, Presiding Judge of the Regional Trial Court,
Makati City, Branch 150, PEOPLE OF THE PHILIPPINES& PHILIPPINE LONG
DISTANCE TELEPHONE COMPANY, Respondents.
DECISION
CALLEJO, SR., J.:
Before us is a Petition for Review on Certiorari of the Decision1 of the Court
of Appeals (CA) in CA-G.R. SP No. 68841 affirming the Order issued by
Judge Zeus C. Abrogar, Regional Trial Court (RTC), Makati City, Branch
150, which denied the "Motion to Quash (With Motion to Defer
Arraignment)" in Criminal Case No. 99-2425 for theft.
Philippine Long Distance Telephone Company (PLDT) is the holder of a
legislative franchise to render local and international telecommunication
services under Republic Act No. 7082.2 Under said law, PLDT is authorized
to establish, operate, manage, lease, maintain and purchase
telecommunication systems, including transmitting, receiving and
switching stations, for both domestic and international calls. For this
purpose, it has installed an estimated 1.7 million telephone lines
nationwide. PLDT also offers other services as authorized by Certificates of
Public Convenience and Necessity (CPCN) duly issued by the National
Telecommunications Commission (NTC), and operates and maintains an
International Gateway Facility (IGF). The PLDT network is thus principally
composed of the Public Switch Telephone Network (PSTN), telephone
handsets and/or telecommunications equipment used by its subscribers,
the wires and cables linking said telephone handsets and/or
telecommunications equipment, antenna, the IGF, and other
telecommunications equipment which provide interconnections.3
1avvphil.net
PLDT alleges that one of the alternative calling patterns that constitute
network fraud and violate its network integrity is that which is known as
International Simple Resale (ISR). ISR is a method of routing and
completing international long distance calls using International Private
Leased Lines (IPL), cables, antenna or air wave or frequency, which
connect directly to the local or domestic exchange facilities of the
terminating country (the country where the call is destined). The IPL is
linked to switching equipment which is connected to a PLDT telephone
terminating country, or in some instances, even those from the originating
country.4
One such alternative calling service is that offered by Baynet Co., Ltd.
(Baynet) which sells "Bay Super Orient Card" phone cards to people who
call their friends and relatives in the Philippines. With said card, one is
entitled to a 27-minute call to the Philippines for about ¥37.03 per minute.
After dialing the ISR access number indicated in the phone card, the ISR
operator requests the subscriber to give the PIN number also indicated in
the phone card. Once the caller’s identity (as purchaser of the phone
card) is confirmed, the ISR operator will then provide a Philippine local line
to the requesting caller via the IPL. According to PLDT, calls made through
the IPL never pass the toll center of IGF operators in the Philippines. Using
the local line, the Baynet card user is able to place a call to any point in
the Philippines, provided the local line is National Direct Dial (NDD)
capable.5
PLDT asserts that Baynet conducts its ISR activities by utilizing an IPL to
course its incoming international long distance calls from Japan. The IPL is
linked to switching equipment, which is then connected to PLDT
telephone lines/numbers and equipment, with Baynet as subscriber.
Through the use of the telephone lines and other auxiliary equipment,
Baynet is able to connect an international long distance call from Japan
to any part of the Philippines, and make it appear as a call originating
from Metro Manila. Consequently, the operator of an ISR is able to evade
payment of access, termination or bypass charges and accounting rates,
as well as compliance with the regulatory requirements of the NTC. Thus,
the ISR operator offers international telecommunication services at a
lower rate, to the damage and prejudice of legitimate operators like
PLDT.6
PLDT pointed out that Baynet utilized the following equipment for its ISR
activities: lines, cables, and antennas or equipment or device capable of
transmitting air waves or frequency, such as an IPL and telephone lines
and equipment; computers or any equipment or device capable of
accepting information applying the prescribed process of the information
and supplying the result of this process; modems or any equipment or
device that enables a data terminal equipment such as computers to
communicate with other data terminal equipment via a telephone line;
multiplexers or any equipment or device that enables two or more signals
from different sources to pass through a common cable or transmission
line; switching equipment, or equipment or device capable of
connecting telephone lines; and software, diskettes, tapes or equipment
or device used for recording and storing information.7
PLDT also discovered that Baynet subscribed to a total of 123 PLDT
telephone lines/numbers.8 Based on the Traffic Study conducted on the
volume of calls passing through Baynet’s ISR network which bypass the IGF
toll center, PLDT incurred an estimated monthly loss of P10,185,325.96.9
Records at the Securities and Exchange Commission (SEC) also revealed
that Baynet was not authorized to provide international or domestic long
distance telephone service in the country. The following are its officers:
Yuji Hijioka, a Japanese national (chairman of the board of directors);
Gina C. Mukaida, a Filipina (board member and president); Luis Marcos
P. Laurel, a Filipino (board member and corporate secretary); Ricky Chan
Pe, a Filipino (board member and treasurer); and Yasushi Ueshima, also a
Japanese national (board member).
Upon complaint of PLDT against Baynet for network fraud, and on the
strength of two search warrants10 issued by the RTC of Makati, Branch 147,
National Bureau of Investigation (NBI) agents searched its office at the 7th
Floor, SJG Building, Kalayaan Avenue, Makati City on November 8, 1999.
Atsushi Matsuura, Nobuyoshi Miyake, Edourd D. Lacson and Rolando J.
Villegas were arrested by NBI agents while in the act of manning the
operations of Baynet. Seized in the premises during the search were
numerous equipment and devices used in its ISR activities, such as
multiplexers, modems, computer monitors, CPUs, antenna, assorted
computer peripheral cords and microprocessors, cables/wires, assorted
PLDT statement of accounts, parabolic antennae and voltage regulators.
State Prosecutor Ofelia L. Calo conducted an inquest investigation and
issued a Resolution11 on January 28, 2000, finding probable cause for theft
under Article 308 of the Revised Penal Code and Presidential Decree No.
40112 against the respondents therein, including Laurel.
On February 8, 2000, State Prosecutor Calo filed an Information with the
RTC of Makati City charging Matsuura, Miyake, Lacson and Villegas with
theft under Article 308 of the Revised Penal Code. After conducting the
requisite preliminary investigation, the State Prosecutor filed an Amended
Information impleading Laurel (a partner in the law firm of Ingles, Laurel,
Salinas, and, until November 19, 1999, a member of the board of directors
and corporate secretary of Baynet), and the other members of the board
of directors of said corporation, namely, Yuji Hijioka, Yasushi Ueshima,
Mukaida, Lacson and Villegas, as accused for theft under Article 308 of
the Revised Penal Code. The inculpatory portion of the Amended
Information reads:
On or about September 10-19, 1999, or prior thereto, in Makati City, and
within the jurisdiction of this Honorable Court, the accused, conspiring and
confederating together and all of them mutually helping and aiding one
another, with intent to gain and without the knowledge and consent of
the Philippine Long Distance Telephone (PLDT), did then and there willfully,
unlawfully and feloniously take, steal and use the international long
distance calls belonging to PLDT by conducting International Simple
Resale (ISR), which is a method of routing and completing international
long distance calls using lines, cables, antennae, and/or air wave
frequency which connect directly to the local or domestic exchange
facilities of the country where the call is destined, effectively stealing this
business from PLDT while using its facilities in the estimated amount of
P20,370,651.92 to the damage and prejudice of PLDT, in the said amount.
CONTRARY TO LAW.13
Accused Laurel filed a "Motion to Quash (with Motion to Defer
Arraignment)" on the ground that the factual allegations in the Amended
Information do not constitute the felony of theft under Article 308 of the
Revised Penal Code. He averred that the Revised Penal Code, or any
other special penal law for that matter, does not prohibit ISR operations.
He claimed that telephone calls with the use of PLDT telephone lines,
whether domestic or international, belong to the persons making the call,
not to PLDT. He argued that the caller merely uses the facilities of PLDT,
and what the latter owns are the telecommunication infrastructures or
facilities through which the call is made. He also asserted that PLDT is
compensated for the caller’s use of its facilities by way of rental; for an
outgoing overseas call, PLDT charges the caller per minute, based on the
duration of the call. Thus, no personal property was stolen from PLDT.
According to Laurel, the P20,370,651.92 stated in the Information, if
anything, represents the rental for the use of PLDT facilities, and not the
value of anything owned by it. Finally, he averred that the allegations in
the Amended Information are already subsumed under the Information
for violation of Presidential Decree (P.D.) No. 401 filed and pending in the
Metropolitan Trial Court of Makati City, docketed as Criminal Case No.
276766.
The prosecution, through private complainant PLDT, opposed the
motion,14 contending that the movant unlawfully took personal property
belonging to it, as follows: 1) intangible telephone services that are being
offered by PLDT and other telecommunication companies, i.e., the
connection and interconnection to their telephone lines/facilities; 2) the
use of those facilities over a period of time; and 3) the revenues derived
in connection with the rendition of such services and the use of such
facilities.15
The prosecution asserted that the use of PLDT’s intangible telephone
services/facilities allows electronic voice signals to pass through the same,
and ultimately to the called party’s number. It averred that such
service/facility is akin to electricity which, although an intangible property,
may, nevertheless, be appropriated and be the subject of theft. Such
service over a period of time for a consideration is the business that PLDT
provides to its customers, which enables the latter to send various
messages to installed recipients. The service rendered by PLDT is akin to
merchandise which has specific value, and therefore, capable of
appropriation by another, as in this case, through the ISR operations
conducted by the movant and his co-accused.
The prosecution further alleged that "international business calls and
revenues constitute personal property envisaged in Article 308 of the
Revised Penal Code." Moreover, the intangible telephone
services/facilities belong to PLDT and not to the movant and the other
accused, because they have no telephone services and facilities of their
own duly authorized by the NTC; thus, the taking by the movant and his
co-accused of PLDT services was with intent to gain and without the
latter’s consent.
The prosecution pointed out that the accused, as well as the movant,
were paid in exchange for their illegal appropriation and use of PLDT’s
telephone services and facilities; on the other hand, the accused did not
pay a single centavo for their illegal ISR operations. Thus, the acts of the
accused were akin to the use of a "jumper" by a consumer to deflect the
current from the house electric meter, thereby enabling one to steal
electricity. The prosecution emphasized that its position is fortified by the
Resolutions of the Department of Justice in PLDT v. Tiongson, et al. (I.S. No.
97-0925) and in PAOCTF-PLDT v. Elton John Tuason, et al. (I.S. No. 2000-370)
which were issued on August 14, 2000 finding probable cause for theft
against the respondents therein.
On September 14, 2001, the RTC issued an Order16 denying the Motion to
Quash the Amended Information. The court declared that, although
there is no law that expressly prohibits the use of ISR, the facts alleged in
the Amended Information "will show how the alleged crime was
committed by conducting ISR," to the damage and prejudice of PLDT.
Laurel filed a Motion for Reconsideration17 of the Order, alleging that
international long distance calls are not personal property, and are not
capable of appropriation. He maintained that business or revenue is not
considered personal property, and that the prosecution failed to adduce
proof of its existence and the subsequent loss of personal property
belonging to another. Citing the ruling of the Court in United States v. De
Guzman,18 Laurel averred that the case is not one with telephone calls
which originate with a particular caller and terminates with the called
party. He insisted that telephone calls are considered privileged
communications under the Constitution and cannot be considered as
"the property of PLDT." He further argued that there is no kinship between
telephone calls and electricity or gas, as the latter are forms of energy
which are generated and consumable, and may be considered as
personal property because of such characteristic. On the other hand, the
movant argued, the telephone business is not a form of energy but is an
activity.
In its Order19 dated December 11, 2001, the RTC denied the movant’s
Motion for Reconsideration. This time, it ruled that what was stolen from
PLDT was its "business" because, as alleged in the Amended Information,
the international long distance calls made through the facilities of PLDT
formed part of its business. The RTC noted that the movant was charged
with stealing the business of PLDT. To support its ruling, it cited Strochecker
v. Ramirez,20 where the Court ruled that interest in business is personal
property capable of appropriation. It further declared that, through their
ISR operations, the movant and his co-accused deprived PLDT of fees for
international long distance calls, and that the ISR used by the movant and
his co-accused was no different from the "jumper" used for stealing
electricity.
Laurel then filed a Petition for Certiorari with the CA, assailing the Order of
the RTC. He alleged that the respondent judge gravely abused his
discretion in denying his Motion to Quash the Amended Information.21 As
gleaned from the material averments of the amended information, he
was charged with stealing the international long distance calls belonging
to PLDT, not its business. Moreover, the RTC failed to distinguish between
the business of PLDT (providing services for international long distance
calls) and the revenues derived therefrom. He opined that a "business" or
its revenues cannot be considered as personal property under Article 308
of the Revised Penal Code, since a "business" is "(1) a commercial or
mercantile activity customarily engaged in as a means of livelihood and
typically involving some independence of judgment and power of
decision; (2) a commercial or industrial enterprise; and (3) refers to
transactions, dealings or intercourse of any nature." On the other hand,
the term "revenue" is defined as "the income that comes back from an
investment (as in real or personal property); the annual or periodical rents,
profits, interests, or issues of any species of real or personal property."22
Laurel further posited that an electric company’s business is the
production and distribution of electricity; a gas company’s business is the
production and/or distribution of gas (as fuel); while a water company’s
business is the production and distribution of potable water. He argued
that the "business" in all these cases is the commercial activity, while the
goods and merchandise are the products of such activity. Thus, in
prosecutions for theft of certain forms of energy, it is the electricity or gas
which is alleged to be stolen and not the "business" of providing electricity
or gas. However, since a telephone company does not produce any
energy, goods or merchandise and merely renders a service or, in the
words of PLDT, "the connection and interconnection to their telephone
lines/facilities," such service cannot be the subject of theft as defined in
Article 308 of the Revised Penal Code.23
He further declared that to categorize "business" as personal property
under Article 308 of the Revised Penal Code would lead to absurd
consequences; in prosecutions for theft of gas, electricity or water, it
would then be permissible to allege in the Information that it is the gas
business, the electric business or the water business which has been stolen,
and no longer the merchandise produced by such enterprise.24
Laurel further cited the Resolution of the Secretary of Justice in Piltel v.
Mendoza,25 where it was ruled that the Revised Penal Code, legislated
as it was before present technological advances were even conceived,
is not adequate to address the novel means of "stealing" airwaves or
airtime. In said resolution, it was noted that the inadequacy prompted the
filing of Senate Bill 2379 (sic) entitled "The Anti-Telecommunications Fraud
of 1997" to deter cloning of cellular phones and other forms of
communications fraud. The said bill "aims to protect in number (ESN) (sic)
or Capcode, mobile identification number (MIN), electronic-international
mobile equipment identity (EMEI/IMEI), or subscriber identity module" and
"any attempt to duplicate the data on another cellular phone without the
consent of a public telecommunications entity would be punishable by
law."26 Thus, Laurel concluded, "there is no crime if there is no law
punishing the crime."
On August 30, 2002, the CA rendered judgment dismissing the petition.27
The appellate court ruled that a petition for certiorari under Rule 65 of the
Rules of Court was not the proper remedy of the petitioner. On the merits
of the petition, it held that while business is generally an activity
which is abstract and intangible in form, it is nevertheless considered
"property" under Article 308 of the Revised Penal Code. The CA opined
that PLDT’s business of providing international calls is personal property
which may be the object of theft, and cited United States v. Carlos28 to
support such conclusion. The tribunal also cited Strochecker v. Ramirez,29
where this Court ruled that one-half interest in a day’s business is personal
property under Section 2 of Act No. 3952, otherwise known as the Bulk
Sales Law. The appellate court held that the operations of the ISR are not
subsumed in the charge for violation of P.D. No. 401.
Laurel, now the petitioner, assails the decision of the CA, contending that
-
THE COURT OF APPEALS ERRED IN RULING THAT THE PERSONAL PROPERTY
ALLEGEDLY STOLEN PER THE INFORMATION IS NOT THE "INTERNATIONAL
LONG DISTANCE CALLS" BUT THE "BUSINESS OF PLDT."
THE COURT OF APPEALS ERRED IN RULING THAT THE TERM "BUSINESS" IS
PERSONAL PROPERTY WITHIN THE MEANING OF ART. 308 OF THE REVISED
PENAL CODE.30
Petitioner avers that the petition for a writ of certiorari may be filed to
nullify an interlocutory order of the trial court which was issued with grave
abuse of discretion amounting to excess or lack of jurisdiction. In support
of his petition before the Court, he reiterates the arguments in his
pleadings filed before the CA. He further claims that while the right to
carry on a business or an interest or participation in business is considered
property under the New Civil Code, the term "business," however, is not.
He asserts that the Philippine Legislature, which approved the Revised
Penal Code way back in January 1, 1932, could not have contemplated
to include international long distance calls and "business" as personal
property under Article 308 thereof.
In its comment on the petition, the Office of the Solicitor General (OSG)
maintains that the amended information clearly states all the essential
elements of the crime of theft. Petitioner’s interpretation as to whether an
"international long distance call" is personal property under the law is
inconsequential, as a reading of the amended information readily reveals
that specific acts and circumstances were alleged charging Baynet,
through its officers, including petitioner, of feloniously taking, stealing and
illegally using international long distance calls belonging to respondent
PLDT by conducting ISR operations, thus, "routing and completing
international long distance calls using lines, cables, antenna and/or
airwave frequency which connect directly to the local or domestic
exchange facilities of the country where the call is destined." The OSG
maintains that the international long distance calls alleged in the
amended information should be construed to mean "business" of PLDT,
which, while abstract and intangible in form, is personal property
susceptible of appropriation.31 The OSG avers that what was stolen by
petitioner and his co-accused is the business of PLDT providing
international long distance calls which, though intangible, is personal
property of the PLDT.32
For its part, respondent PLDT asserts that personal property under Article
308 of the Revised Penal Code comprehends intangible property such as
electricity and gas which are valuable articles for merchandise, brought
and sold like other personal property, and are capable of appropriation.
It insists that the business of international calls and revenues constitute
personal property because the same are valuable articles of
merchandise. The respondent reiterates that international calls involve (a)
the intangible telephone services that are being offered by it, that is, the
connection and interconnection to the telephone network, lines or
facilities; (b) the use of its telephone network, lines or facilities over a
period of time; and (c) the income derived in connection therewith.33
PLDT further posits that business revenues or the income derived in
connection with the rendition of such services and the use of its telephone
network, lines or facilities are personal properties under Article 308 of the
Revised Penal Code; so is the use of said telephone services/telephone
network, lines or facilities which allow electronic voice signals to pass
through the same and ultimately to the called party’s number. It is akin to
electricity which, though intangible property, may nevertheless be
appropriated and can be the object of theft. The use of respondent
PLDT’s telephone network, lines, or facilities over a period of time for
consideration is the business that it provides to its customers, which
enables the latter to send various messages to intended recipients. Such
use over a period of time is akin to merchandise which has value and,
therefore, can be appropriated by another. According to respondent
PLDT, this is what actually happened when petitioner Laurel and the other
accused below conducted illegal ISR operations.34
The petition is meritorious.
The issues for resolution are as follows: (a) whether or not the petition for
certiorari is the proper remedy of the petitioner in the Court of Appeals;
(b) whether or not international telephone calls using Bay Super Orient
Cards through the telecommunication services provided by PLDT for such
calls, or, in short, PLDT’s business of providing said telecommunication
services, are proper subjects of theft under Article 308 of the Revised Penal
Code; and (c) whether or not the trial court committed grave abuse of
discretion amounting to excess or lack of jurisdiction in denying the motion
of the petitioner to quash the amended information.
On the issue of whether or not the petition for certiorari instituted by the
petitioner in the CA is proper, the general rule is that a petition for certiorari
under Rule 65 of the Rules of Court, as amended, to nullify an order
denying a motion to quash the Information is inappropriate because the
aggrieved party has a remedy of appeal in the ordinary course of law.
Appeal and certiorari are mutually exclusive of each other. The remedy
of the aggrieved party is to continue with the case in due course and,
when an unfavorable judgment is rendered, assail the order and the
decision on appeal. However, if the trial court issues the order denying the
motion to quash the Amended Information with grave abuse of discretion
amounting to excess or lack of jurisdiction, or if such order is patently
erroneous, or null and void for being contrary to the Constitution, and the
remedy of appeal would not afford adequate and expeditious relief, the
accused may resort to the extraordinary remedy of certiorari.35 A special
civil action for certiorari is also available where there are special
circumstances clearly demonstrating the inadequacy of an appeal. As
this Court held in Bristol Myers Squibb (Phils.), Inc. v. Viloria:36
Nonetheless, the settled rule is that a writ of certiorari may be granted in
cases where, despite availability of appeal after trial, there is at least a
prima facie showing on the face of the petition and its annexes that: (a)
the trial court issued the order with grave abuse of discretion amounting
to lack of or in excess of jurisdiction; (b) appeal would not prove to be a
speedy and adequate remedy; (c) where the order is a patent nullity; (d)
the decision in the present case will arrest future litigations; and (e) for
certain considerations such as public welfare and public policy.37
In his petition for certiorari in the CA, petitioner averred that the trial court
committed grave abuse of its discretion amounting to excess or lack of
jurisdiction when it denied his motion to quash the Amended Information
despite his claim that the material allegations in the Amended Information
do not charge theft under Article 308 of the Revised Penal Code, or any
offense for that matter. By so doing, the trial court deprived him of his
constitutional right to be informed of the nature of the charge against him.
He further averred that the order of the trial court is contrary to the
constitution and is, thus, null and void. He insists that he should not be
compelled to undergo the rigors and tribulations of a protracted trial and
incur expenses to defend himself against a non-existent charge.
Petitioner is correct.
An information or complaint must state explicitly and directly every act or
omission constituting an offense38 and must allege facts establishing
conduct that a penal statute makes criminal;39 and describes the
property which is the subject of theft to advise the accused with
reasonable certainty of the accusation he is called upon to meet at the
trial and to enable him to rely on the judgment thereunder of a
subsequent prosecution for the same offense.40 It must show, on its face,
that if the alleged facts are true, an offense has been committed. The rule
is rooted on the constitutional right of the accused to be informed of the
nature of the crime or cause of the accusation against him. He cannot
be convicted of an offense even if proven unless it is alleged or necessarily
included in the Information filed against him.
As a general prerequisite, a motion to quash on the ground that the
Information does not constitute the offense charged, or any offense for
that matter, should be resolved on the basis of said allegations whose
truth and veracity are hypothetically committed;41 and on additional
facts admitted or not denied by the prosecution.42 If the facts alleged in
the Information do not constitute an offense, the complaint or information
should be quashed by the court.43
We have reviewed the Amended Information and find that, as mentioned
by the petitioner, it does not contain material allegations charging the
petitioner of theft of personal property under Article 308 of the Revised
Penal Code. It, thus, behooved the trial court to quash the Amended
Information. The Order of the trial court denying the motion of the
petitioner to quash the Amended Information is a patent nullity.
On the second issue, we find and so hold that the international telephone
calls placed by Bay Super Orient Card holders, the telecommunication
services provided by PLDT and its business of providing said services are
not personal properties under Article 308 of the Revised Penal Code. The
construction by the respondents of Article 308 of the said Code to include,
within its coverage, the aforesaid international telephone calls,
telecommunication services and business is contrary to the letter and
intent of the law.
The rule is that, penal laws are to be construed strictly. Such rule is founded
on the tenderness of the law for the rights of individuals and on the plain
principle that the power of punishment is vested in Congress, not in the
judicial department. It is Congress, not the Court, which is to define a
crime, and ordain its punishment.44 Due respect for the prerogative of
Congress in defining crimes/felonies constrains the Court to refrain from a
broad interpretation of penal laws where a "narrow interpretation" is
appropriate. The Court must take heed to language, legislative history
and purpose, in order to strictly determine the wrath and breath of the
conduct the law forbids.45 However, when the congressional purpose is
unclear, the court must apply the rule of lenity, that is, ambiguity
concerning the ambit of criminal statutes should be resolved in favor of
lenity.46
Penal statutes may not be enlarged by implication or intent beyond the
fair meaning of the language used; and may not be held to include
offenses other than those which are clearly described, notwithstanding
that the Court may think that Congress should have made them more
comprehensive.47 Words and phrases in a statute are to be construed
according to their common meaning and accepted usage.
As Chief Justice John Marshall declared, "it would be dangerous, indeed,
to carry the principle that a case which is within the reason or mischief of
a statute is within its provision, so far as to punish a crime not enumerated
in the statute because it is of equal atrocity, or of kindred character with
those which are enumerated.48 When interpreting a criminal statute that
does not explicitly reach the conduct in question, the Court should not
base an expansive reading on inferences from subjective and variable
understanding.49
Article 308 of the Revised Penal Code defines theft as follows:
Art. 308. Who are liable for theft.– Theft is committed by any person who,
with intent to gain but without violence, against or intimidation of persons
nor force upon things, shall take personal property of another without the
latter’s consent.
The provision was taken from Article 530 of the Spanish Penal Code which
reads:
1. Los que con ánimo de lucrarse, y sin violencia o intimidación en las
personas ni fuerza en las cosas, toman las cosas muebles ajenas sin la
voluntad de su dueño.50
For one to be guilty of theft, the accused must have an intent to steal
(animus furandi) personal property, meaning the intent to deprive
another of his ownership/lawful possession of personal property which
intent is apart from and concurrently with the general criminal intent
which is an essential element of a felony of dolo (dolus malus).

An information or complaint for simple theft must allege the following
elements: (a) the taking of personal property; (b) the said property
belongs to another; (c) the taking be done with intent to gain; and (d) the
taking be accomplished without the use of violence or intimidation of
person/s or force upon things.51
One is apt to conclude that "personal property" standing alone, covers
both tangible and intangible properties and are subject of theft under the
Revised Penal Code. But the words "Personal property" under the Revised
Penal Code must be considered in tandem with the word "take" in the
law. The statutory definition of "taking" and movable property indicates
that, clearly, not all personal properties may be the proper subjects of
theft. The general rule is that, only movable properties which have
physical or material existence and susceptible of occupation by another
are proper objects of theft.52 As explained by Cuelo Callon: "Cosa
juridicamente es toda sustancia corporal, material, susceptible de ser
aprehendida que tenga un valor cualquiera."53
According to Cuello Callon, in the context of the Penal Code, only those
movable properties which can be taken and carried from the place they
are found are proper subjects of theft. Intangible properties such as rights
and ideas are not subject of theft because the same cannot be "taken"
from the place it is found and is occupied or appropriated.
Solamente las cosas muebles y corporales pueden ser objeto de hurto. La
sustracción de cosas inmuebles y la cosas incorporales (v. gr., los
derechos, las ideas) no puede integrar este delito, pues no es posible
asirlas, tomarlas, para conseguir su apropiación. El Codigo emplea la
expresión "cosas mueble" en el sentido de cosa que es susceptible de ser
llevada del lugar donde se encuentra, como dinero, joyas, ropas,
etcétera, asi que su concepto no coincide por completo con el
formulado por el Codigo civil (arts. 335 y 336).54
Thus, movable properties under Article 308 of the Revised Penal Code
should be distinguished from the rights or interests to which they relate. A
naked right existing merely in contemplation of law, although it may be
very valuable to the person who is entitled to exercise it, is not the subject
of theft or larceny.55 Such rights or interests are intangible and cannot be
"taken" by another. Thus, right to produce oil, good will or an interest in
business, or the right to engage in business, credit or franchise are
properties. So is the credit line represented by a credit card. However,
they are not proper subjects of theft or larceny because they are without
form or substance, the mere "breath" of the Congress. On the other hand,
goods, wares and merchandise of businessmen and credit cards issued
to them are movable properties with physical and material existence and
may be taken by another; hence, proper subjects of theft.
There is "taking" of personal property, and theft is consummated when the
offender unlawfully acquires possession of personal property even if for a
short time; or if such property is under the dominion and control of the
thief. The taker, at some particular amount, must have obtained
complete and absolute possession and control of the property adverse to
the rights of the owner or the lawful possessor thereof.56 It is not necessary
that the property be actually carried away out of the physical possession
of the lawful possessor or that he should have made his escape with it.57
Neither asportation nor actual manual possession of property is required.
Constructive possession of the thief of the property is enough.58
The essence of the element is the taking of a thing out of the possession
of the owner without his privity and consent and without animus
revertendi.59
Taking may be by the offender’s own hands, by his use of innocent
persons without any felonious intent, as well as any mechanical device,
such as an access device or card, or any agency, animate or inanimate,
with intent to gain. Intent to gain includes the unlawful taking of personal
property for the purpose of deriving utility, satisfaction, enjoyment and
pleasure.60
We agree with the contention of the respondents that intangible
properties such as electrical energy and gas are proper subjects of theft.
The reason for this is that, as explained by this Court in United States v.
Carlos61 and United States v. Tambunting,62 based on decisions of the
Supreme Court of Spain and of the courts in England and the United States
of America, gas or electricity are capable of appropriation by another
other than the owner. Gas and electrical energy may be taken, carried
away and appropriated. In People v. Menagas,63 the Illinois State
Supreme Court declared that electricity, like gas, may be seen and felt.
Electricity, the same as gas, is a valuable article of merchandise, bought
and sold like other personal property and is capable of appropriation by
another. It is a valuable article of merchandise, bought and sold like other
personal property, susceptible of being severed from a mass or larger
quantity and of being transported from place to place. Electrical energy
may, likewise, be taken and carried away. It is a valuable commodity,
bought and sold like other personal property. It may be transported from
place to place. There is nothing in the nature of gas used for illuminating
purposes which renders it incapable of being feloniously taken and
carried away.
In People ex rel Brush Electric Illuminating Co. v. Wemple,64 the Court of
Appeals of New York held that electric energy is manufactured and sold
in determinate quantities at a fixed price, precisely as are coal, kerosene
oil, and gas. It may be conveyed to the premises of the consumer, stored
in cells of different capacity known as an accumulator; or it may be sent
through a wire, just as gas or oil may be transported either in a close tank
or forced through a pipe. Having reached the premises of the consumer,
it may be used in any way he may desire, being, like illuminating gas,
capable of being transformed either into heat, light, or power, at the
option of the purchaser. In Woods v. People,65 the Supreme Court of
Illinois declared that there is nothing in the nature of gas used for
illuminating purposes which renders it incapable of being feloniously
taken and carried away. It is a valuable article of merchandise, bought
and sold like other personal property, susceptible of being severed from
a mass or larger quantity and of being transported from place to place.
Gas and electrical energy should not be equated with business or services
provided by business entrepreneurs to the public. Business does not have
an exact definition. Business is referred as that which occupies the time,
attention and labor of men for the purpose of livelihood or profit. It
embraces everything that which a person can be employed.66 Business
may also mean employment, occupation or profession. Business is also
defined as a commercial activity for gain benefit or advantage.67
Business, like services in business, although are properties, are not proper
subjects of theft under the Revised Penal Code because the same cannot
be "taken" or "occupied." If it were otherwise, as claimed by the
respondents, there would be no juridical difference between the taking
of the business of a person or the services provided by him for gain, vis-à-
vis, the taking of goods, wares or merchandise, or equipment comprising
his business.68 If it was its intention to include "business" as personal
property under Article 308 of the Revised Penal Code, the Philippine
Legislature should have spoken in language that is clear and definite: that
business is personal property under Article 308 of the Revised Penal
Code.69
We agree with the contention of the petitioner that, as gleaned from the
material averments of the Amended Information, he is charged of
"stealing the international long distance calls belonging to PLDT" and the
use thereof, through the ISR. Contrary to the claims of the OSG and
respondent PLDT, the petitioner is not charged of stealing P20,370,651.95
from said respondent. Said amount of P20,370,651.95 alleged in the
Amended Information is the aggregate amount of access, transmission or
termination charges which the PLDT expected from the international long
distance calls of the callers with the use of Baynet Super Orient Cards sold
by Baynet Co. Ltd.
In defining theft, under Article 308 of the Revised Penal Code, as the
taking of personal property without the consent of the owner thereof, the
Philippine legislature could not have contemplated the human voice
which is converted into electronic impulses or electrical current which are
transmitted to the party called through the PSTN of respondent PLDT and
the ISR of Baynet Card Ltd. within its coverage. When the Revised Penal
Code was approved, on December 8, 1930, international telephone calls
and the transmission and routing of electronic voice signals or impulses
emanating from said calls, through the PSTN, IPL and ISR, were still non-
existent. Case law is that, where a legislative history fails to evidence
congressional awareness of the scope of the statute claimed by the
respondents, a narrow interpretation of the law is more consistent with the
usual approach to the construction of the statute. Penal responsibility
cannot be extended beyond the fair scope of the statutory mandate.70
Respondent PLDT does not acquire possession, much less, ownership of
the voices of the telephone callers or of the electronic voice signals or
current emanating from said calls. The human voice and the electronic
voice signals or current caused thereby are intangible and not susceptible
of possession, occupation or appropriation by the respondent PLDT or
even the petitioner, for that matter. PLDT merely transmits the electronic
voice signals through its facilities and equipment. Baynet Card Ltd.,
through its operator, merely intercepts, reroutes the calls and passes them
to its toll center. Indeed, the parties called receive the telephone calls
from Japan.
In this modern age of technology, telecommunications systems have
become so tightly merged with computer systems that it is difficult to know
where one starts and the other finishes. The telephone set is highly
computerized and allows computers to communicate across long
distances.71 The instrumentality at issue in this case is not merely a
telephone but a telephone inexplicably linked to a computerized
communications system with the use of Baynet Cards sold by the Baynet
Card Ltd. The corporation uses computers, modems and software, among
others, for its ISR.72
The conduct complained of by respondent PLDT is reminiscent of
"phreaking" (a slang term for the action of making a telephone system to
do something that it normally should not allow by "making the phone
company bend over and grab its ankles"). A "phreaker" is one who
engages in the act of manipulating phones and illegally markets
telephone services.73 Unless the phone company replaces all its
hardware, phreaking would be impossible to stop. The phone companies
in North America were impelled to replace all their hardware and
adopted full digital switching system known as the Common Channel Inter
Office Signaling. Phreaking occurred only during the 1960’s and 1970’s,
decades after the Revised Penal Code took effect.
The petitioner is not charged, under the Amended Information, for theft
of telecommunication or telephone services offered by PLDT. Even if he is,
the term "personal property" under Article 308 of the Revised Penal Code
cannot be interpreted beyond its seams so as to include
"telecommunication or telephone services" or computer services for that
matter. The word "service" has a variety of meanings dependent upon the
context, or the sense in which it is used; and, in some instances, it may
include a sale. For instance, the sale of food by restaurants is usually
referred to as "service," although an actual sale is involved.74 It may also
mean the duty or labor to be rendered by one person to another;
performance of labor for the benefit of another.75 In the case of PLDT, it
is to render local and international telecommunications services and such
other services as authorized by the CPCA issued by the NTC. Even at
common law, neither time nor services may be taken and occupied or
appropriated.76 A service is generally not considered property and a
theft of service would not, therefore, constitute theft since there can be
no caption or asportation.77 Neither is the unauthorized use of the
equipment and facilities of PLDT by the petitioner theft under the
aforequoted provision of the Revised Penal Code.78
If it was the intent of the Philippine Legislature, in 1930, to include services
to be the subject of theft, it should have incorporated the same in Article
308 of the Revised Penal Code. The Legislature did not. In fact, the Revised
Penal Code does not even contain a definition of services.
If taking of telecommunication services or the business of a person, is to
be proscribed, it must be by special statute79 or an amendment of the
Revised Penal Code. Several states in the United States, such as New York,
New Jersey, California and Virginia, realized that their criminal statutes did
not contain any provisions penalizing the theft of services and passed laws
defining and penalizing theft of telephone and computer services. The
Pennsylvania Criminal Statute now penalizes theft of services, thus:
(a) Acquisition of services. --
(1) A person is guilty of theft if he intentionally obtains services for himself
or for another which he knows are available only for compensation, by
deception or threat, by altering or tampering with the public utility meter
or measuring device by which such services are delivered or by causing
or permitting such altering or tampering, by making or maintaining any
unauthorized connection, whether physically, electrically or inductively,
to a distribution or transmission line, by attaching or maintaining the
attachment of any unauthorized device to any cable, wire or other
component of an electric, telephone or cable television system or to a
television receiving set connected to a cable television system, by making
or maintaining any unauthorized modification or alteration to any device
installed by a cable television system, or by false token or other trick or
artifice to avoid payment for the service.
In the State of Illinois in the United States of America, theft of labor or
services or use of property is penalized:
(a) A person commits theft when he obtains the temporary use of
property, labor or services of another which are available only for hire, by
means of threat or deception or knowing that such use is without the
consent of the person providing the property, labor or services.
In 1980, the drafters of the Model Penal Code in the United States of
America arrived at the conclusion that labor and services, including
professional services, have not been included within the traditional scope
of the term "property" in ordinary theft statutes. Hence, they decided to
incorporate in the Code Section 223.7, which defines and penalizes theft
of services, thus:
(1) A person is guilty of theft if he purposely obtains services which he
knows are available only for compensation, by deception or threat, or by
false token or other means to avoid payment for the service. "Services"
include labor, professional service, transportation, telephone or other
public service, accommodation in hotels, restaurants or elsewhere,
admission to exhibitions, use of vehicles or other movable property. Where
compensation for service is ordinarily paid immediately upon the
rendering of such service, as in the case of hotels and restaurants, refusal
to pay or absconding without payment or offer to pay gives rise to a
presumption that the service was obtained by deception as to intention
to pay; (2) A person commits theft if, having control over the disposition of
services of others, to which he is not entitled, he knowingly diverts such
services to his own benefit or to the benefit of another not entitled thereto.
Interestingly, after the State Supreme Court of Virginia promulgated its
decision in Lund v. Commonwealth,80 declaring that neither time nor
services may be taken and carried away and are not proper subjects of
larceny, the General Assembly of Virginia enacted Code No. 18-2-98
which reads:
Computer time or services or data processing services or information or
data stored in connection therewith is hereby defined to be property
which may be the subject of larceny under § § 18.2-95 or 18.2-96, or
embezzlement under § 18.2-111, or false pretenses under § 18.2-178.
In the State of Alabama, Section 13A-8-10(a)(1) of the Penal Code of
Alabama of 1975 penalizes theft of services:
"A person commits the crime of theft of services if: (a) He intentionally
obtains services known by him to be available only for compensation by
deception, threat, false token or other means to avoid payment for the
services …"
In the Philippines, Congress has not amended the Revised Penal Code to
include theft of services or theft of business as felonies. Instead, it
approved a law, Republic Act No. 8484, otherwise known as the Access
Devices Regulation Act of 1998, on February 11, 1998. Under the law, an
access device means any card, plate, code, account number, electronic
serial number, personal identification number and other
telecommunication services, equipment or instrumentalities-identifier or
other means of account access that can be used to obtain money,
goods, services or any other thing of value or to initiate a transfer of funds
other than a transfer originated solely by paper instrument. Among the
prohibited acts enumerated in Section 9 of the law are the acts of
obtaining money or anything of value through the use of an access
device, with intent to defraud or intent to gain and fleeing thereafter; and
of effecting transactions with one or more access devices issued to
another person or persons to receive payment or any other thing of value.
Under Section 11 of the law, conspiracy to commit access devices fraud
is a crime. However, the petitioner is not charged of violation of R.A. 8484.
Significantly, a prosecution under the law shall be without prejudice to
any liability for violation of any provisions of the Revised Penal Code
inclusive of theft under Rule 308 of the Revised Penal Code and estafa
under Article 315 of the Revised Penal Code. Thus, if an individual steals a
credit card and uses the same to obtain services, he is liable of the
following: theft of the credit card under Article 308 of the Revised Penal
Code; violation of Republic Act No. 8484; and estafa under Article
315(2)(a) of the Revised Penal Code with the service provider as the
private complainant. The petitioner is not charged of estafa before the
RTC in the Amended Information.
Section 33 of Republic Act No. 8792, Electronic Commerce Act of 2000
provides:
Sec. 33. Penalties.— The following Acts shall be penalized by fine and/or
imprisonment, as follows:
a) Hacking or cracking which refers to unauthorized access into or
interference in a computer system/server or information and
communication system; or any access in order to corrupt, alter, steal, or
destroy using a computer or other similar information and communication
devices, without the knowledge and consent of the owner of the
computer or information and communications system, including the
introduction of computer viruses and the like, resulting on the corruption,
destruction, alteration, theft or loss of electronic data messages or
electronic documents shall be punished by a minimum fine of One
hundred thousand pesos (P100,000.00) and a maximum commensurate
to the damage incurred and a mandatory imprisonment of six (6) months
to three (3) years.
IN LIGHT OF ALL THE FOREGOING, the petition is GRANTED. The assailed
Orders of the Regional Trial Court and the Decision of the Court of Appeals
are REVERSED and SET ASIDE. The Regional Trial Court is directed to issue
an order granting the motion of the petitioner to quash the Amended
Information.
SO ORDERED.
G.R. No. 158385 February 12, 2010
MODESTO PALALI, Petitioner,
vs.
JULIET AWISAN, represented by her Attorney-in-Fact GREGORIO AWISAN,
Respondent.
DECISION
DEL CASTILLO, J.:
A person occupying a parcel of land, by himself and through his
predecessors-in-interest, enjoys the presumption of ownership. Anyone
who desires to remove him from the property must overcome such
presumption by relying solely on the strength of his claims rather than on
the weakness of the defense.
This Petition for Review on Certiorari1 under Rule 45 of the Rules of Court
assails the September 27, 2002 Decision2 and the April 25, 2003 Resolution3
of the Court of Appeals (CA) in CA-G.R. CV No. 52942. The challenged
Decision disposed as follows:
WHEREFORE, premises considered, the assailed decision of the trial court
dated May 24, 1996 is hereby REVERSED AND SET ASIDE and a new one is
entered:
1. Awarding the subject land in favor of the [respondent] with the
exclusion of the area where the residential house of the [petitioner] is
erected.
2. Ordering the [petitioner] to vacate the rootcrop land and surrender its
possession in favor of the [respondent], and enjoining the [petitioner] to
refrain from doing any act disturbing the [respondent’s] peaceful
possession and enjoyment of the same.
3. Cancelling Tax Declaration No. 31297 of the [petitioner] insofar as the
rootcrop land of .0648 hectares is concerned, with the exclusion of his
residential land. All other reliefs and remedies prayed for are DENIED, there
being no sufficient evidence to warrant granting them.
SO ORDERED.4
Factual Antecedents
Respondent Juliet Awisan claimed to be the owner5 of a parcel of land
in Sitio Camambaey, Tapapan, Bauko, Mountain Province, allegedly
consisting of 6.6698 hectares6 and covered by Tax Declaration No. 147 in
her name.7 On March 7, 1994, she filed an action for quieting of title
against petitioner Modesto Palali, alleging that the latter occupied and
encroached on the northern portion of her property and surreptitiously
declared it in his name for tax purposes.8 We shall refer to this land
occupied by petitioner, which allegedly encroached on the northern
portion of respondent’s 6.6698-hectare land, as the "subject property".
Respondent prayed to be declared the rightful owner of the northern
portion, for the cancellation of petitioner’s tax declaration, and for the
removal of petitioner and his improvements from the property.9
Respondent’s (Plaintiff’s) Allegations
According to respondent, the 6.6698 hectare land was originally owned
by her father, Cresencio Cadwising. The latter testified that he and his wife
were able to consolidate ownership over the land by declaring them from
public land as well as by purchasing from adjoining landowners. He
admitted including in his tax declaration a communal sacred lot
(patpatayan) even if he did not acquire free patent title over the same.
As for the properties he bought, these were generally purchased without
any documentation, save for two.10
Cadwising also claimed having introduced improvements on the subject
property as early as the 1960s.11 The 6.6698 hectare land was mortgaged
to the Development Bank of the Philippines (DBP), which acquired it in the
foreclosure sale. DBP then sold the land to one Tico Tibong, who
eventually donated the same to respondent.
Petitioner’s (Defendant’s) Allegations
In his defense, petitioner denied the encroachment and asserted
ownership over the subject property. He maintained that he and his
ancestors or predecessors-in-interest have openly and continuously
possessed the subject land since time immemorial. He and his siblings
were born on that land and, at that time, the area around the house was
already planted with bananas, alnos, and coffee.12 When his mother
died, he buried her in the lot beside the house in 1975; while his father was
buried near the same plot in 1993.13 His own home had been standing on
the property for the past 20 years. Petitioner insisted that during this entire
time, no one disturbed his ownership and possession thereof.14
Sometime in 1974, petitioner declared the said land in his name for
taxation purposes.15 The said Tax Declaration indicates that the property
consists of 200 square meters of residential lot and 648 square meters of
rootcrop land (or a total of 848 square meters).
Proceedings before the Regional Trial Court
It is worth mentioning that both the complaint16 and the pre-trial brief17
of respondent alleged encroachment only on the northern portion of her
6.6698-hectare land. During trial, however, respondent’s attorney-in-fact,
Gregorio Awisan,18 and respondent’s predecessor-in-interest, Cresencio
Cadwising,19 both alleged that there was an encroachment in the
southern portion also. This was done without amending the allegations of
the complaint.

Confronted with this new allegation of encroachment on the southern
portion, petitioner tried to introduce his tax declaration over the same (in
the name of his deceased father), but was objected to by respondent on
the ground of immateriality.20 After such objection, however, respondent
surprisingly and inconsistently insisted that the ownership of the southern
portion was included in the complaint and was an issue in the case. The
ensuing confusion over the subject of the case is revealed in the following
exchange between the parties’ lawyers:21
Atty. Awisan: Where is the land in question located?
Palali: In Tapapan, Bauko, sir.
Atty. Awisan: Where is that situated in relation to your house?
Palali: It is near my house which is enclosed with fence.
Atty. Awisan: How about the land in question situated in the southern
portion, do you know that?
Palali: That is the land our parents gave to us as inheritance. There are
terraces there.
Atty. Awisan: So, the land in question [is] located below your house and
on the southern portion?
Atty. Bayogan: As far as the southern portion is concerned, it is not
included in the complaint.
Atty. Awisan: It is included.
Atty. Bayogan: The southern portion refer[s] to Lot 3 and it is not included
in the complaint. In fact when I started asking question regarding this land,
the counsel objected.
Atty. Awisan: This land indicated as Lot 3 is the southern portion.
The trial court, apparently relying on the allegations of the complaint,
ruled on the northern portion as the subject property of the case.
Ruling of the Regional Trial Court
After due trial, the Regional Trial Court of Bontoc, Mountain Province,
Branch 35, dismissed22 the complaint. It based its decision on
respondent’s failure to prove her allegation of physical possession of the
land. Going by the results of its ocular inspection23 of the land in question,
the trial court noted that Cadwising (respondent’s predecessor-in-
interest) could not pinpoint and the court did not see any of the
improvements that Cadwising had allegedly introduced to the land.24
Thus, the trial court held that respondent’s claim of ownership was
supported solely by her tax declarations and tax payment receipts which,
by themselves, are not conclusive proof of ownership.25
In contrast, the trial court duly verified during the ocular inspection the
existence of the improvements introduced by petitioner and his
predecessors on the subject property.26 Moreover, the trial court
observed that the witnesses for the petitioner all lived continuously since
their births within or near Sitio Camambaey in Tapapan and that they
knew the land very well. They knew petitioner and his predecessors, as
well as the improvements introduced by them to the land. Thus, the trial
court found that the petitioner presented overwhelming proof of actual,
open, continuous and physical possession of the property since time
immemorial. Petitioner’s possession, coupled with his tax declarations, is
strong evidence of ownership which convinced the court of his better
right to the property.27
For purposes of clarity, we cite the dispositive portion of the trial court’s
Decision thus:
Wherefore, premises considered, judgment is hereby rendered in favor of
the defendant Modesto Palali and against the plaintiff Juliet C. Awisan,
represented by her Attorney-in-Fact, Gregorio B. Awisan, as follows:
a) Ordering the dismissal of the complaint and costs against the plaintiff;
b) Adjudging the defendant Modesto Palali as the owner and lawful
possessor of the subject property; and
c) The court cannot however grant the counterclaim of defendant for
lack of evidence to prove the same.
SO ORDERED.28
Ruling of the Court of Appeals
Respondent appealed the trial court’s decision to the CA, which reversed
the same. The CA found that petitioner failed to prove actual possession
of the entire 6.6698 hectare land, which the CA believed to be the subject
of the case. According to the appellate court, petitioner was only able to
prove actual occupation of the portion where his house was located and
the area below where he had planted fruit-bearing plants.29
The CA also ruled that based on the ocular inspection report of the trial
court, petitioner’s possession did not extend to the entire 6.6698 hectares.
In its own words:
Likewise, the report on the ocular inspection of the land in question
divulges that the alleged possession of the land by [petitioner] Modesto
Palali does not extend to the entire 6.6698 hectares of the subject land.
Not even in the sketch plan of the land does it illustrate that the possession
of the [petitioner] refers to the entire subject land. Instead, the possession
of [petitioner] merely points to certain portions of the subject land as
drawn and prepared by the tax mappers.
From the foregoing testimony, no sufficient indicia could be inferred that
the possession of the [petitioner] refers to the entire portion of the land.30
The appellate court also refused to give credence to petitioner’s tax
declaration. The CA held that petitioner’s Tax Declaration No. 31793,
which covers only an 848-square meter property, is incongruous with his
purported claim of ownership over the entire 6.6698-hectare land.
Proceeding from this premise, the CA gave greater weight to the
documentary and testimonial evidence of respondent. The presumption
of regularity was given to the public documents from which respondent
traced her title to the subject property.
Thus, the CA awarded the entire 6.6698-hectare property to respondent
and ordered the cancellation of petitioner’s tax declaration (except for
the 200-square meter residential lot thereof which was not being claimed
by respondent).31
Petitioner moved for a reconsideration of the unfavorable Decision, but
his motion was denied for lack of merit.
Hence, this petition.
Preliminary Matter
The CA Decision is based on a mistaken understanding of the subject
property
It is apparent that the CA Decision proceeded from an erroneous
understanding of what the subject property actually is and what the trial
court actually ruled upon. The CA was under the mistaken impression that
the subject property was the entire 6.6698 hectares of land allegedly
owned by respondent under her Tax Declaration No. 147. Because of this,
the CA ruled against petitioner on the ground that he failed to prove
possession of the entire 6.6698 hectares. The CA also disregarded
petitioner’s Tax Declaration No. 31793 (despite being coupled with actual
possession) because the said tax declaration covered only an 848-square
meter property and did not cover the entire 6.6698 hectare property. This
is clear from the following text lifted from the CA Decision:
The trial court’s finding that the defendant-appellee had acquired the
subject land by virtue of acquisitive prescription cannot be
countenanced. At the outset, the subject land being claimed by the
plaintiff-appellant as described in the complaint is the 6.6698 hectares
land [boundaries omitted]. The said description is with the exclusion of the
portion of land where the residential house of the defendant-appellee is
erected. However, the adverse and exclusive possession offered by the
defendant-appellee, which includes his tax receipt, does not refer to the
entire land consisting of 6.6698 hectares being claimed by the plaintiff-
appellant. x x x The witnesses for the defendant-appellee testified that
indeed Modesto Palali’s predecessors-in-interest have once built a house
in Camambaey, Tapapan, Bauko, Mt. Province, but whether or not the
defendant-appellee or his predecessor-in-interest have actually,
exclusively, notoriously, and adversely possessed the entire 6.6698
hectares of land could not be deduced from their testimonies. It could be
gleaned from the testimony of Consigno Saligen, that what the
defendant-appellee actually possessed and claim as their own is merely
that portion where the house is erected and that portion of land below
the house where Modesto Palali planted fruit-bearing plants. x x x
Likewise, the report on ocular inspection of the land in question divulges
that the alleged possession of the land by defendant-appellee Modesto
Palali does not extend to the entire 6.6698 hectares of the subject land.
Not even in the sketch plan of the land does it illustrate that the possession
of the defendant-appellee refers to the entire subject land. Instead, the
possession of the defendant-appellee merely points to certain portions of
the subject land as drawn and prepared by the "tax mappers".
From the foregoing testimony, no sufficient indicia could be inferred that
the possession of the defendant-appellee refers to the entire portion of
the land.32
This was perhaps not entirely the appellate court’s fault, because a
reading of the issues presented by respondent to the CA gives the wrong
impression that the subject property is the entire 6.6698 hectares:
x x x [T]he plaintiff-appellant elevated the matter on appeal assigning the
following errors committed by the trial court:
I Proceeding from a wrong premise as to what is the subject property, the
The trial court erred in failing to consider the overwhelming superior
documentary and oral evidence of the plaintiff Juliet C. Awisan showing
her ownership on (sic) the land in question consisting of 6.6698 hectares
described in her complaint
II
The trial court erred in adjudicating the land in question to the defendant
Modesto Palali who is a squatter on the land whose tax declaration
merely overlapped or duplicated that of the plaintiff and which covered
only a small portion of 200 square meters of residential portion [sic] and
648 square meter of rootcrop land.
x x x x33
The foregoing formulation of the issues presented by respondent before
the CA erroneously described "the land in question" as "consisting of
6.6698 hectares" and erroneously stated that the trial court "adjudicated
the land in question to [petitioner]". Said formulation is very misleading
because the case before the trial court did not involve the ownership of
the entire 6.6698 hectares, but merely the northern portion thereof – the
property actually occupied by petitioner and much smaller than 6.6698
hectares. Even if we go back to the respondent’s complaint, we would
find there that respondent is claiming encroachment merely of the
"northern portion" of her 6.6698-hectare property, and not of the entire
6.6698 property.34
Neither did the trial court adjudicate to petitioner the entire 6.6698-
hectare land; it simply upheld petitioner’s right to the property he is
actually occupying. It only declared petitioner as the lawful owner and
possessor of the "subject property", which is the property to the north of
the 6.6698-hectare land and occupied by petitioner. This is evident from
the trial court’s summary of the facts established by the respondent and
her witnesses, to wit:
During the hearing of the case, plaintiff and her witnesses established and
disclosed: x x x that only a portion of the entire 6.6 hectares in its northern
portion located below and above the residential house of the defendant
Modesto Palali is now the land in question as properly shown in the sketch
of the land covered by Tax Declaration No. 147 in the name of Juliet
Awisan x x x.35
CA utterly failed to appreciate the evidence as they relate to the parties’
claims. Thus, while the general rule is that this Court is not a trier of facts,
and that in a petition for review under Rule 45, only questions of law may
be raised, the Court is behooved to admit the instant case as an
exception.36
Issue
The issue in this case is who between the parties has the better right to the
subject property.
Our Ruling
Having gone over the parties’ evidence before the trial court, we find
adequate support for the trial court’s ruling in favor of petitioner. The CA
erred in reversing the trial court’s findings, particularly because, as
discussed above, such reversal was premised on the CA’s erroneous
understanding of the subject property.
As found by the trial court, petitioner was able to prove his and his
predecessors’ actual, open, continuous and physical possession of the
subject property dating at least to the pre-war era (aside from petitioner’s
tax declaration over the subject property). Petitioner’s witnesses were
long time residents of Sitio Camambaey. They lived on the land, knew their
neighbors and were familiar with the terrain. They were witnesses to the
introduction of improvements made by petitioner and his predecessors-
in-interest.
From their consistent, unwavering, and candid testimonies, we find that
petitioner’s grandfather Mocnangan occupied the land during the pre-
war era. He planted camote on the property because this was the staple
food at that time. He then gave the subject property to his daughter
Tammam, while he gave a separate one to his son Pacolan Mocnangan.
In the 1960s, Tammam and her husband Palalag cultivated the land, built
a cogon home, and started a family there. Palalag introduced terraces
and, together with his sons, built earth fences around the property.
Palalag’s family initially planted bananas, coffee, and oranges; they later
added avocadoes, persimmons, and pineapples. When Tammam and
Palalag died, their son, petitioner herein, buried them in the subject
property and continued cultivating the land. He also constructed a new
home.
On the other hand, respondent relied merely on her tax declaration, but
failed to prove actual possession insofar as the subject property is
concerned. To be sure, respondent attempted to prove possession of the
subject property. Her predecessor-in-interest, Cadwising, had allegedly
introduced improvements like a piggery, poultry, terracing, plantings, and
a barbed wire fence. However, not one of these alleged improvements
was found during the ocular inspection conducted by the trial court. The
absence of all his alleged improvements on the property is suspicious in
light of his assertion that he has a caretaker living near the subject
property for 20 years. Cadwising did not even bother to explain the
absence of the improvements. The trial court’s rejection of Cadwising’s
assertions regarding the introduction of improvements is therefore not
baseless.1avvphi1
Thus, respondent having failed to prove possession, her claim rests solely
on her tax declaration. But tax declarations, by themselves, are not
conclusive evidence of ownership of real property. In the absence of
actual, public, and adverse possession, the declaration of the land for tax
purposes does not prove ownership.37 Respondent’s tax declaration,
therefore, cannot serve as basis to oust petitioner who has been in
possession (by himself and his predecessors) of the subject property since
before the war.
Neither can respondent rely on the public instruments dealing with the
6.6698-hectare property covered by her tax declaration. Such public
documents merely show the successive transfers of the property covered
by said documents. They do not conclusively prove that the transferor
actually owns the property purportedly being transferred, especially as far
as third parties are concerned. For it may very well be that the transferor
does not actually own the property he has transferred, in which case he
transfers no better right to his transferee. No one can give what he does
not have – nemo dat quod non habet.38 Thus, since respondent’s
predecessor-in-interest Cadwising appeared not to have any right to the
subject property, he transferred no better right to his transferees, including
respondent.
All told, we hold that as between the petitioner and the respondent, it is
the petitioner who has the better claim or title to the subject property.
While the respondent merely relied on her tax declaration, petitioner was
able to prove actual possession of the subject property coupled with his
tax declaration. We have ruled in several cases that possession, when
coupled with a tax declaration, is a weighty evidence of ownership.39 It
certainly is more weighty and preponderant than a tax declaration alone.
The preponderance of evidence is therefore clearly in favor of petitioner,
particularly considering that, as the actual possessor under claim of
ownership, he enjoys the presumption of ownership.40 Moreover, settled
is the principle that a party seeking to recover real property must rely on
the strength of her case rather than on the weakness of the defense.41
The burden of proof rests on the party who asserts the affirmative of an
issue. For he who relies upon the existence of a fact should be called upon
to prove that fact. Having failed to discharge her burden to prove her
affirmative allegations, we find that the trial court rightfully dismissed
respondent’s complaint.
A final note. Like the trial court, we make no ruling regarding the southern
portion of the property (or Lot 3, as referred to by the parties), because
this property was not included in respondent’s complaint. Although the
Rules of Court provide that "when issues not raised by the pleadings are
tried with the express or implied consent of the parties, they shall be
treated in all respects as if they had been raised in the pleadings,"42 such
rule does not apply here. Respondent objected43 when petitioner tried
to prove his ownership of Lot 3 on the ground of immateriality, arguing
that ownership of Lot 3 was not an issue. Respondent cannot now insist
otherwise.
WHEREFORE, the petition is GRANTED. The September 27, 2002 Decision as
well as the April 25, 2003 Resolution of the Court of Appeals in CA-G.R. CV
No. 52942 are REVERSED and SET ASIDE. The May 24, 1996 Decision of the
Regional Trial Court of Bontoc, Mountain Province, Branch 35 is
REINSTATED and AFFIRMED. Costs against respondent.
SO ORDERED.
[G.R. NO. 177384 : December 8, 2009]
JOSEPHINE WEE, Petitioner, v. REPUBLIC OF THE PHILIPPINES, Respondent.

DECISION
DEL CASTILLO, J.:
In land registration cases, the applicant has the burden to show that he
or she is the real and absolute owner in fee simple of the land sought to
be registered.1 It is also important to bear in mind that one who seeks
registration of title must prove his or her claim with "well-nigh
incontrovertible" evidence.2 In this case, petitioner miserably failed to
show that she is the real and absolute owner in fee simple of the land
sought to be registered.
Assailed in this Petition for Review on Certiorari3 under Rule 45 of the Rules
of Court are the April 28, 2006 Decision4 of the Court of Appeals (CA) and
its subsequent Resolution5 dated April 3, 2007 in CA-G.R. CV No. 76519.
Said Decision and Resolution reversed and set aside the April 2, 2002
Judgment6 of the Regional Trial Court (RTC) of Tagaytay City, Branch 18
and held that petitioner was not entitled to the requested registration of
title.
Proceedings before the Regional Trial Court
On December 22, 1994, petitioner filed an Application for Registration of
Title7 over a 4,870-square meter parcel of land situated in Barangay Puting
Kahoy, Silang, Cavite, designated as Lot No. 8349 (Cadastral Lot. No. 452-
D).
In brief, petitioner alleged in her application that she is the owner in fee
simple of the subject property by virtue of a Deed of Absolute Sale8 dated
February 1, 1993 executed by Julian Gonzales in her favor. Petitioner
claimed the benefits of the Property Registration Decree9 or, should said
Decree be inapplicable, the benefits of Chapter VIII of Commonwealth
Act No. 141 (1936),10 because she and her predecessor-in-interest have
been in open, continuous, public, peaceful and adverse possession of the
land since time immemorial.
On March 15, 1995, the Republic of the Philippines, through the Office of
the Solicitor General (OSG), filed its Opposition11 alleging that neither the
petitioner nor her predecessor-in-interest has been in open, continuous,
exclusive and notorious possession and occupation of Lot No. 8349 since
June 12, 1945 or prior thereto. The OSG likewise averred that the
muniments of title and tax payment receipts submitted by the petitioner
do not constitute competent or sufficient evidence of a bona fide
acquisition of the subject lot, or of the petitioner's open, continuous,
exclusive and notorious possession and occupation thereof in the
concept of owner since June 12, 1945 or prior thereto. It asserted that Lot
No. 8349 is part of the public domain and consequently prayed for the
dismissal of the application for registration.
Petitioner presented the following pieces of documentary evidence
before the trial court:
1) Deed of Absolute Sale between Josephine Wee and Julian Gonzales
dated February 1, 1993;12
2) Tax Declarations in the name of Julian Gonzales for the years 1957, 1961,
1967, 1980, and 1985;13
3) Tax Declarations in the name of Josephine Wee from 1993 onwards;14
4) Receipts for tax payments made by Josephine Wee from 1993-1999;15
5) Affidavit of Seller-Transferor executed by Julian Gonzales on February
10, 1993;16
6) Affidavit of Ownership, Aggregate Land Holding and Non-Tenancy
executed by Julian Gonzales on February 10, 1993;17
7) Affidavit of Non-Tenancy executed by Julian Gonzales on February 10,
1993;18
8) Salaysay executed by Juana Macatangay Gonzales, Erlinda Gonzales
Batingal and Remedios Gonzales Bayan;19
9) Certification dated March 2, 2000 by the Department of Environment
and Natural Resources (DENR) stating that Lot No. 8349 was shown to be
within the Alienable or Disposable Land per Land Classification Map No.
3013 established under FAO-4-1656 on March 15, 1982;20
10) Survey Plan of Lot No. 8349;21 and
11) Surveyor's Certificate, Technical Description and Tracing Cloth.22
She also presented the testimonies of the following witnesses who were all
cross-examined by the Republic through the public prosecutor:
1) Josephine Wee, who testified that she purchased Lot No. 8349 from
Julian Gonzales through a Deed of Absolute Sale dated February 1, 1993
and immediately took possession thereof after the sale; that she did not
cultivate it because it is planted with coffee; that she paid for all the real
property taxes subsequent to the sale; that she caused the preparation
of a survey plan; that the property is not part of the public domain or any
river or military reservation; that there are no adverse claimants and no
cases were filed against her after the sale involving said lot and that she
is not doing anything with the property because it is not "productive".23
2) Juana Gonzales, the 75-year old widow of Julian Gonzales, who
declared that she and her husband sold Lot No. 8349 to the petitioner and
identified her husband's signature and her own thumbmark. She testified
that she and her late husband had been in possession of Lot No. 8349 prior
to the sale to Josephine Wee; that her husband inherited the property
from his parents "a long time ago"; that her husband already had the
property when they got married and that she and Julian Gonzales began
living together in 1946. She also identified and affirmed the due execution
and authenticity of her Salaysay, as well as the documents signed by her
husband.24
3) Remedios Gonzales Bayan, the 39-year old daughter of Julian and
Juana Gonzales, who testified that she witnessed the execution of the
Deed of Absolute Sale between her father whose signature she identified
and the applicant in February 1993. She also identified and affirmed the
due execution and authenticity of her Salaysay.25
Ruling of the Regional Trial Court
On April 2, 2002, the RTC promulgated in favor of the petitioner a
Judgment,26 pertinent portions of which read:
Culled from the evidence on record, both testimonial and documentary,
are facts which satisfactorily establish applicant's ownership in fee simple
of the parcel of land, subject matter of the instant proceedings, to wit:
that by means of an appropriate deed of sale, the applicant has
acquired said property by purchase from Julian Gonzales on February 1,
1993; that the same parcel was declared for taxation purposes; that all
the realty taxes due thereon have been duly paid. Likewise, this Court
could well-discern from the survey plan covering the same property and
other documents presented, more particularly the tracing cloth plan
which was presented as additional evidence in support of the
application, that the land sought to be registered is agricultural and not
within any forest zone or the public domain; that the land is not covered
by any public land application/patent, and that there is no other adverse
claimant thereof; and further, that tacking her predecessors-in-interest's
possession to applicant's, the latter appears to be in continuous and
public possession thereof for more than thirty (30) years.
On the basis of the foregoing facts and considering that applicant is a
Filipino citizen not otherwise disqualified from owning real property, this
Court finds that she has satisfied all the conditions essential to the grant of
her application pursuant to the provisions of the Land Registration Law, as
amended.ςηαñrοblεš νιr†υαl lαω lιbrαrÿ
WHEREFORE, this Court hereby approves this application for registration
and thus places under the operation of Act 141, Act 496 and/or P.D. 1529,
otherwise known as Property Registration Law, the lands described in Plan
Ap-04-010262, Lot 8349 and containing an area of Four Thousand Eight
Hundred Seventy (4,870) Square Meters as supported by its technical
description now forming part of the record of this case, in addition to other
proofs adduced in the name of JOSEPHINE WEE, who is of legal age, single
and with residence at 1345 Claro M. Recto Avenue, Sta, Cruz, Manila.
Once this Decision becomes final and executory, the corresponding
decree of registration shall forthwith issue.
SO ORDERED.
Proceedings before the Court of Appeals
Unsatisfied, the Republic, through the OSG, filed its Notice of Appeal on
April 26, 2002, alleging that the RTC erred in granting the application for
registration considering that petitioner failed to comply with all the legal
requirements for judicial confirmation of her alleged title. In particular, the
OSG claimed that Lot No. 8349 was classified as alienable and disposable
land only on March 15, 1982, as per Certification issued by the DENR. Thus,
petitioner and her predecessor-in-interest could not have been in
possession of the property since June 12, 1945, or earlier. The OSG also
pointed out that the tax declarations presented by petitioner are fairly
recent and do not show petitioner and her predecessor-in-interest's
nature of possession. Furthermore, the original tracing cloth plan was not
presented in evidence.
Ruling of the Court of Appeals
The CA reversed the RTC Judgment. It held that petitioner failed to prove
that she and her predecessor-in-interest have been in possession and
occupation of the subject lot under a bona fide claim of ownership since
June 12, 1945. Thus:
In granting the application for registration of title, the court a quo merely
relied on the deed of sale executed by Julian Gonzales, in favor of
applicant-appellee on February 1, 1993, the tax declarations and tax
receipts. It is interesting to note that Juana Gonzales, widow of Julian
Gonzales, after identifying the deed of sale executed by her deceased
husband in favor of applicant-appellee, merely stated that the lot subject
thereof was inherited by Julian from his parents a long time ago and that
Julian was in possession of the lot since 1946 when they started living
together. For her part, applicant-appellee testified that she immediately
took possession of the subject lot, which was planted with coffee, after
acquiring the same and that she is not doing anything on the lot because
it is not productive. As pointed out by the Republic, applicant-appellee
and Juana Gonzales failed to specify what acts of development,
cultivation, and maintenance were done by them on the subject lot. x x
x
xxx
In the case at bar, applicant-appellee merely claimed that the subject
lot is planted with coffee. However, no evidence was presented by her as
to who planted the coffee trees thereon. In fact, applicant-appellee
admitted that she is not doing anything on the subject lot because it is not
productive, thereby implying that she is not taking care of the coffee trees
thereon. Moreover, tax declarations and tax receipts are not conclusive
evidence of ownership but are merely indicia of a claim of ownership,
aside from the fact that the same are of recent vintage.27
Hence, this petition.
Issues
Petitioner's arguments
1) The testimony of Juana Gonzales proves that petitioner's predecessor-
in-interest, Julian Gonzales, occupied Lot No. 8349 even prior to 1946;
2) The fact that the property is planted with coffee, a fruit bearing tree,
reveals that the lot is planted, cultivated and cared for. Thus, there was
not only effective and active possession and occupation but actual
cultivation and tending of the coffee plantation; andcralawlibrary
3) The fact that the land was declared for tax purposes as early as 1957
shows that the land was actively possessed and occupied by petitioner
and her predecessor-in-interest.
Respondent's arguments:
1) Since Lot No. 8349 became part of the alienable and disposable land
only on March 15, 1982, petitioner could not have been considered as
having been in open, continuous, exclusive and notorious possession and
occupation of subject property under a bona fide claim of ownership;
andcralawlibrary
2) There is no proof that petitioner or Julian Gonzales undertook any clear
act of dominion or ownership over Lot No. 8349, since there are no
structures, improvements, or plantings on the property.
Our Ruling
The petition lacks merit.
Petitioner failed to prove open, continuous, exclusive and notorious
possession of the subject property.
In Director, Land Management Bureau v. Court of Appeals,28 we
explained that -
x x x The phrase "adverse, continuous, open, public, peaceful and in
concept of owner," by which characteristics private respondent describes
his possession and that of his parents, are mere conclusions of law
requiring evidentiary support and substantiation. The burden of proof is on
the private respondent, as applicant, to prove by clear, positive and
convincing evidence that the alleged possession of his parents was of the
nature and duration required by law. His bare allegations without more,
do not amount to preponderant evidence that would shift the burden of
proof to the oppositor.
Here, we find that petitioner's possession of the lot has not been of the
character and length of time required by law. The relevant provision of
the Property Registration Decree relied upon by petitioner reads'
SEC. 14. Who may apply. - The following persons may file in the proper
Court of First Instance an application for registration of title to land,
whether personally or through their duly authorized representatives:
(1) Those who by themselves or through their predecessors-in-interest have
been in open, continuous, exclusive and notorious possession and
occupation of alienable and disposable lands of the public domain
under a bona fide claim of ownership since June 12, 1945, or
earlier.ςηαñrοblεš νιr†υαl lαω lιbrαrÿ
(2) Those who have acquired ownership of private lands by prescription
under the provisions of existing laws. x x x
Unfortunately, petitioner failed to prove that she and her predecessor-in-
interest have been in open, continuous, exclusive and notorious
possession and occupation of the subject property under a bona fide
claim of ownership since June 12, 1945.
First, there is nothing in the records which would substantiate her claim
that Julian Gonzales was in possession of Lot No. 8349 since 1945, other
than the bare allegations of Juana Gonzales.29 Certainly, these
unsubstantiated statements do not meet the required quantum of
evidence in land registration cases. In fact, contrary to her testimony that
her late husband inherited the property from his parents "a long time ago",
or even prior to 1945, the earliest tax declaration that was presented in
this case is one declared by Julian Gonzales only in 1957 - long after June
1945.
It bears stressing that petitioner presented only five tax declarations (for
the years 1957, 1961, 1967, 1980 and 1985) for a claimed possession and
occupation of more than 45 years (1945-1993). This type of intermittent
and sporadic assertion of alleged ownership does not prove open,
continuous, exclusive and notorious possession and occupation. In any
event, in the absence of other competent evidence, tax declarations do
not conclusively establish either possession or declarant's right to
registration of title.30
Petitioner failed to prove possession in the concept of an owner.
Second, and more importantly, we agree with the CA that petitioner was
unable to demonstrate that the alleged possession was in the concept of
an owner, since she could not point to any acts of occupation,
development, cultivation or maintenance over the property. Petitioner
claims that because the property is planted with coffee, a fruit-bearing
tree, it automatically follows that the lot is cultivated, showing actual
possession and occupation. However, petitioner failed to explain who
planted the coffee, whether these plants are maintained or harvested or
if any other acts were undertaken by petitioner or her predecessor-in-
interest to cultivate the property.
Even if we were to assume that the coffee was planted by petitioner's
predecessor-in-interest, "mere casual cultivation" of the land does not
amount to exclusive and notorious possession that would give rise to
ownership.31 The presence of an unspecified number of coffee plants,
without proof that petitioner or her predecessor-in-interest actually and
deliberately cultivated them is not sufficient to support a claim of title. In
fact, the five tax declarations in the name of Julian Gonzales described
the lot as "unirrigated riceland". No improvements or plantings were
declared or noted in any of these tax declarations. It was only in
petitioner's 1993 tax declaration that the land was described as planted
with coffee. We are, therefore, constrained to conclude that the mere
existence of an unspecified number of coffee plants, sans any evidence
as to who planted them, when they were planted, whether cultivation or
harvesting was made or what other acts of occupation and ownership
were undertaken, is not sufficient to demonstrate petitioner's right to the
registration of title in her favor.
WHEREFORE, the petition is DENIED. The Court of Appeals' April 28, 2006
Decision in CA-G.R. CV No. 76519 and its Resolution dated April 3, 2007
denying petitioner's Motion for Reconsideration are both AFFIRMED.
SO ORDERED.
G.R. No. L-14652 June 30, 1960
JUAN GARGANTOS, petitioner,
vs.
TAN YANON and THE COURT OF APPEALS, respondents.
Jose T. Nery for petitioner.
Constantino P. Tadena for respondents.
GUTIERREZ DAVID, J.:
Juan Gargantos appeals by certiorari from the decision of the Court of
Appeals reversing the judgment of the Court of First Instance of Romblon.
The record discloses that the late Francisco Sanz was the former owner of
a parcel of land containing 888 square meters, with the buildings and
improvements thereon, situated in the poblacion of Romblon. He
subdivided the lot into three and then sold each portion to different
persons. One portion was purchased by Guillermo Tengtio who
subsequently sold it to Vicente Uy Veza. Another portion, with the house
of strong materials thereon, was sold in 1927 to Tan Yanon, respondent
herein. This house has on its northeastern side, doors and windows over-
looking the third portion, which, together with the camarin and small
building thereon, after passing through several hands, was finally
acquired by Juan Gargantos, petitioner herein.
On April 23, 1955, Gargantos applied to the Municipal Mayor for a permit
to demolish the roofing of the old camarin. The permit having been
granted, Gargantos tore down the roof of the camarin. On May 11, 1955,
Gargantos asked the Municipal Council of Romblon for another permit,
this time in order to construct a combined residential house and
warehouse on his lot. Tan Yanon opposed approval of this application.
Because both the provincial fiscal and district engineer of Romblon
recommended granting of the building permit to Gargantos, Tan Yanon
filed against Gargantos an action to restrain him from constructing a
building that would prevent plaintiff from receiving light and enjoying the
view trough the window of his house, unless such building is erected at a
distance of not less than three meters from the boundary line between
the lots of plaintiff and defendant, and to enjoin the members of
Municipal Council of Romblon from issuing the corresponding building
permit to defendant. The case as against the members of the Municipal
Council was subsequently dismissed with concurrence of plaintiff's
council. After trial, the Court of First Instance of Romblon rendered
judgment dismissing the complaint and ordering plaintiff to pay
defendant the sum of P12,500.00 by way of compensatory, exemplary,
moral and moderate damages.
On appeal, the Court of Appeals set aside the decision of the Court of
First Instance of Romblon and enjoined defendant from constructing his
building unless "he erects the same at a distance of not less than three
meters from the boundary line of his property, in conformity with Article
673 of the New Civil Code."
So Juan Gargantos filed this petition for review of the appellate Court's
decision. The focal issue herein is whether the property of respondent Tan
Yanon has an easement of light and view against the property of
petitioner Gargantos.
The kernel of petitioner's argument is that respondent never acquired any
easement either by title or by prescription. Assuredly, there is no deed
establishing an easement. Likewise, neither petitioner nor his
predecessors-in-interest have ever executed any deed whereby they
recognized the existence of the easement, nor has there been final
judgment to that effect. Invoking our decision in Cortes vs. Yu-Tibo (2 Phil.,
24), petitioner maintains that respondent has not acquired an easement
by prescription because he has never formally forbidden petitioner from
performing any act which would be lawful without the easement, hence
the prescriptive period never started.
It is obvious, however, that Article 538, O.C.C. (now Article 621, N.C.C.)
and the doctrine in the Yu-Tibo case are not applicable herein because
the two estates, that now owned by petitioner, and that owner by
respondent, were formerly owned by just one person, Francisco Sanz. It
was Sanz who introduced improvements on both properties. On that
portion presently belonging to respondent, he constructed a house in
such a way that the northeastern side thereof extends to the wall of the
camarin on the portion now belonging to petitioner. On said northeastern
side of the house, there are windows and doors which serve as passages
for light and view. These windows and doors were in existence when
respondent purchased the house and lot from Sanz. The deed sale did
not provide that the easement of light and view would not be established.
This then is precisely the case covered by Article 541, O.C.C (now Article
624, N.C.C) which provides that the existence of an apparent sign of
easement between two estates, established by the proprietor of both,
shall be considered, if one of them is alienated, as a title so that the
easement will continue actively and passively, unless at the time the
ownership of the two estate is divided, the contrary is stated in the deed
of alienation of either of them, or the sign is made to disappear before the
instrument is executed. The existence of the doors and windows on the
northeastern side of the aforementioned house, is equivalent to a title, for
the visible and permanent sign of an easement is the title that
characterizes its existence (Amor vs. Florentino, 74 Phil., 403). It should be
noted, however, that while the law declares that the easement is to
"continue" the easement actually arises for the first time only upon
alienation of either estate, inasmuch as before that time there is no
easement to speak of, there being but one owner of both estates (Articles
530, O.C.C., now Articles 613, N.C.C).
We find that respondent Tan Yanon's property has an easement of light
and view against petitioner's property. By reason of his easement
petitioner cannot construct on his land any building unless he erects it at
a distance of not less than three meters from the boundary line separating
the two estates.
Wherefore, the appealed decision is hereby affirmed with costs against
petitioner.
G.R. No. 188666, December 14, 2017
SPOUSES JUAN AND ANTONINA CANO, ROLANDO CANO AND JOSEPHINE
"JOSIE" CANO--AQUINO, Petitioners, v. SPOUSES ARTURO AND
EMERENCIANA CANO, Respondents.
G.R. No. 190750, December 14, 2017
SPOUSES JUAN CANO AND ANTONINA SORIANO-CANO, Petitioners, v.
SPOUSES ARTURO CANO AND EMERENCIANA DACASIN, Respondents.
DECISION
SERENO, C.J.:
These consolidated Petitions for Review involve a dispute over possession
and ownership of a parcel of land located in the Barrio of Palaming, City
of San Carlos, Pangasinan. Petitioners Juan and Antonina Cano anchor
their claim upon a donation propter nuptias allegedly made by Feliza1
Baun in their favor in 1962. Respondents Arturo and Emerenciana Cano,
on the other hand, claim that they purchased the land from Feliza in 1982
and caused the annotation of the Deed of Absolute Sale on the Original
Certificate of Title (OCT) No. 62276 covering the property.
The Petition in G.R. No. 188666 assails the Decision2 and the Resolution3 of
the Fourth Division of the Court of Appeals (CA) in CA-G.R. SP No. 104200,
which affirmed the Regional Trial Court (RTC) Resolution4 ordering
petitioners to vacate the property and surrender possession thereof to
respondents. Meanwhile, the Petition in G.R. No. 190750 questions the CA
Decision5 and the Resolution,6 which affirmed the RTC Decision7
confirming respondents' ownership of the property. The factual
background and the proceedings held in each case will be discussed in
turn.
FACTUAL ANTECEDENTS
G.R. No. 188666
(Ejectment Case)
On 16 November 1999, respondents filed a Complaint for Ejectment with
Prayer for Injunction8 against petitioners on the basis of a Deed of
Absolute Sale9 executed in the former's favor by Feliza, the registered
owner of the property. Immediately after the sale, respondents allegedly
(1) took possession of the land;10 (2) employed a relative to act as
caretaker thereof;11 and (3) received the fruit of the mango trees planted
thereon.12
Respondents also asserted that they benevolently allowed petitioners to
take actual possession of the property after the sale because the parties
were all blood relatives.13 This peaceful arrangement continued until 3
October 1999, the day petitioners allegedly harassed and threw stones at
the individuals hired by respondents to spray the mango trees with
chemical fruit inducers.14 This act of ingratitude supposedly prompted
respondents to send petitioners a demand letter to vacate the
property.15
Because the demand to vacate went unheeded, respondents filed an
ejectment complaint before the Municipal Trial Court in Cities (MTCC) of
San Carlos City, Pangasinan.16 They prayed for (a) an order directing
petitioners to vacate the property and pay moral damages and
attorney's fees to the former;17 and (b) an injunction to restrain petitioners
from performing acts that would disturb or harass respondents or the
latter's agents in violation of their right of ownership and possession over
the property.18
In an Answer with Affirmative and/or Special Defenses and
Counterclaim,19 petitioners denied the allegations in the Complaint. They
claimed ownership of the property on the basis of (1) a donation propter
nuptias20 executed in their favor by Feliza on 30 May 1962; and (2) their
continuous possession of the land since they were born, or for more than
63 years at the time of the filing of the suit for ejectment.21 They also
asserted that the Deed of Absolute Sale cited by respondents was a
falsified instrument.22
The MTCC Ruling
In a Decision23 dated 21 February 2000, the MTCC dismissed the
Complaint for lack of merit. Citing an Ocular Inspection Report submitted
by the sheriff who investigated the disputed property, the court noted that
three semi-concrete houses owned by petitioners, as well as several
mango trees, were standing on the land. These improvements were
considered as evidence of laches on the part of respondents and justified
the dismissal of the Complaint:
Plaintiffs['] failure to raise a restraining arm to the defendants' introduction
of several improvements on the disputed property in a span of almost
eighteen (18) years is simply contrary to their claim of ownership.
Thus, the plaintiffs['] long inaction or passivity in asserting their alleged
rights over the disputed property will preclude them from recovering the
same under the equitable principle of laches.
xxxx
If, indeed the plaintiffs are very assertive of their claim of ownership over
the disputed property, they should have filed a judicial action for recovery
of possession or ejectment before or at the time of the construction of two
(2) additional houses of defendant Juan Cano's children, namely
defendants Rolando Cano and Josie Aquino, and NOT merely paying
realty taxes and securing Tax Declarations, only on December 22, 1999
considering that tax receipts and tax declarations are only prima facie
evidence of ownership and possession (Heirs of Leopoldo Vencilao, Sr., et
al. vs. CA, April 1, 1998).24
As to the issue of ownership, the MTCC ruled in favor of petitioners. It
upheld the validity of the donation propter nuptias in view of the absence
of a declaration by a proper forum that the instrument was null and void25
and the lack of evidence that Feliza was indeed incapable of signing her
name on the instrument of donation.26
The following circumstances were likewise deemed consistent with the
claim of ownership by petitioners: (a) their payment of realty taxes on the
property; (b) the continued registration of the title to the property in the
name of their mother, Feliza; and (c) the execution of the donation
propter nuptias prior to the Deed of Sale.27
The RTC Ruling
While the RTC initially affirmed the MTCC Decision and considered the
claim of respondents barred by laches,28 it subsequently reversed its own
ruling. In a Resolution dated 27 May 2008,29 the RTC declared
respondents as the true owners of the property on account of the
registered Deed of Absolute Sale in their favor. This instrument was
considered as evidence of a preferred right as against petitioners' claim
based on an unregistered donation propter nuptias:
The Court notes that the Deed of Absolute Sale executed in favor of
plaintiffs-appellants over the portion pertaining to Felisa Baun is registered
on the title itself. This registration is proof of their ownership over the land,
the purpose of which is to quiet title to land and to put a stop forever to
any question of the legality of the title. Not only that, the annotation on
the said title says that that portion pertaining to the share of Felisa Baun is
tenanted by plaintiff-appellant[,] Arturo Cano. Clearly, plaintiff-appellant,
before and at the time he was ousted by the defendants-appellees, was
in possession of the property, first as a tenant prior to 1982 and as the
owner thereof from 1982 onwards.
Indeed, as provided under Section 51, 2nd paragraph, P.D. 1529, "the act
of registration shall be the operative act to convey or affect the [l]and
insofar as third parties are concerned, and in all cases under this Decree,
the registration shall be made in the office of the Registrar of Deeds for
the province or city where the land lies." As between the two transactions,
the donation and the sale, respectively, concerning the subject parcel of
land in the name of Felisa Baun, plaintiffs-appellants who have registered
the sale in their favor [have] a preferred right over the defendants-
appellees who have not registered their title.30
The CA Ruling
On appeal,31 the CA upheld the RTC ruling and declared that the
registered transaction should prevail over the earlier unregistered right:32
It is not contested that the property in question is a registered land with
Original Certificate of Title No. 62276. It is also uncontested that the sale in
favor of respondents herein have been annotated on the title. On the
other hand, the purported Donation Propter Nuptias in favor of petitioners
herein has not been annotated in the Title of the property subject of this
case.
xxxx
Clearly, as between the Deed of Sale in favor of respondents herein that
is annotated in the title and the donation in favor of petitioners, the
effective and binding transfer is that covered by the Deed of Sale.33
The CA denied the Motion for Reconsideration filed by petitioners,34
prompting them to file the Petition for Review in G.R. No 188666.35
Proceedings before the Court
Before this Court, petitioners contend that the non-registration of the
donation propter nuptias in their favor does not make their claim inferior
to that of respondents.36 Citing Article 749 of the Civil Code, the
petitioners argue that donations of immovable property are considered
valid so long as these are made in a public document.37 They also claim
that registration does not vest ownership over any particular property, but
is merely an evidence of title thereto.38 Moreover, registration was
supposedly unnecessary in this case, because respondents were
"manifestly aware of the petitioners' existing interest in the property, albeit
not registered,"39 as petitioners were in possession of the property at the
time it was allegedly purchased.40
Petitioners also emphasize that the donation propter nuptias was
executed by Feliza 20 years before the alleged execution of the Deed of
Absolute Sale.41 Assuming that she had agreed to the sale, this second
transaction conveyed nothing to respondents.42 Finally, petitioners assert
that even if the donation propter nuptias is assumed to be invalid, they still
have a better right over the property as they have already established
their ownership by virtue of acquisitive prescription.43
In their Comment,44 respondents deny the allegation that they were
aware of petitioners' claim over the property at the time they purchased
it.45 They also assert that after they had purchased the lot, they had the
Tax Declarations transferred to their names, and that they henceforth
paid the realty taxes thereon up to the present.46 Respondents likewise
pray for the dismissal of the Petition for raising factual issues that have
already been resolved by the lower courts.47
During the pendency of G.R. No. 188666, a second Petition docketed as
G.R. No. 190750 was filed before this Court. As will be discussed, the
second case involves the same property and the same parties, but
pertains specifically to the issue of ownership.
G.R. No. 190750
(Quieting of Title Case)
The dispute in G.R. No. 190750 stemmed from a Complaint for Quieting of
Title, Declaration of Nullity of Document, Ownership and Damages48 filed
by petitioners with the RTC of San Carlos City, Pangasinan.49 The suit was
instituted while the ejectment case in G.R. No. 188666 was pending.
In the Complaint, petitioners claimed absolute ownership over the subject
property citing the donation propter nuptias executed in their favour,50
as well as their possession of the land since 1962. They further alleged that
the quieting of title was necessary, because respondents were claiming
ownership of the same lot on the basis of a spurious and simulated deed
of sale.
In their Sworn Answer,51 respondents sought the dismissal of the
Complaint on the following grounds: (1) failure to comply with a condition
precedent, i.e., the conduct of barangay conciliation proceedings; (2)
forum shopping; (3) laches; (4) prescription; and (5) failure to state a
cause of action.52 They also asserted that the signature of Feliza on the
instrument of donation was spurious, considering that she did not know
how to write and could only affix her thumbmark to legal documents.
The RTC Ruling
In a Decision53 dated 27 May 2008, the RTC declared respondents the
rightful owners of the property.54 While affirming the validity of both the
donation propter nuptias made in favor of petitioners and the Deed of
Absolute Sale presented by respondents, the trial court declared that the
sale prevailed over the donation because of the operative fact of
registration.55 The RTC explained:
The formalities required by law having been established on the two (2)
documents (Donation Propter Nuptias for the plaintiffs and Deed of
Absolute Sale for the defendants), We now proceed to determine which
between these documents prevails over the other. The Court finds the
right of the defendants superior over that of the plaintiffs.
Section 51, 2nd paragraph, P.D. 1529 provides, "the act of registration shall
be the operative act to convey or affect the land insofar as third persons
are concerned and in all cases under this Decree, the registration shall be
made in the office of the Registrar of Deeds for the province or city where
the land lies.
It is settled in this jurisdiction that the maxim "Prior est in tempore. Potior est
injure." (He who is first in time is preferred in right) is observed in land
registration matters. As between the two transactions, the donation and
the sale, respectively, concerning the subject parcel of land in the name
of Felisa Baun, the defendants who have registered the sale in their favor
have a preferred right over the plaintiffs have not registered their title,
even if the latter are in actual possession of the property involved.56
The RTC also noted that respondents presented sufficient evidence to
prove their possession of the property since 1982, while petitioners failed
to submit proof in support of the latter's claim of ownership and
occupancy:

Moreover, as established by evidence, the house on which plaintiffs stay
was once the ancestral house of the family of Felissa Baun. It was likewise
the only house standing on the land in question until the dispute between
the parties arose in 1999. The annotation on TCT no. 62276 in 1982 that
defendant Arturo Cano is the tenant of the subject parcel of land would
show that indeed it was defendant Arturo Cano who possessed and took
care of the land prior to the said year until he purchased the same in 1982.
Defendants, after the sale[,] had declared the subject property for
taxation purposes in their names. Likewise, from 1982 up to 2005,
defendants religiously paid the realty tax due from (sic) the subject
property. Their possession however was disturbed in 1999, the year he was
disallowed entry by the plaintiffs. Aside from defendants' registered
ownership over the parcel of land in question, the tax declaration and
annual tax payments bolster the fact of their ownership of the subject lot.
Plaintiffs on the other hand failed to present evidence that indeed they
are the legitimate owners of the subject parcel of land. Except for their
present possession of the subject property, they and their children failed
to present evidence that the subject land and the improvements,
particularly the houses standing thereon, are declared in their names.
They also failed to present any documentary evidence to prove payment
of taxes due from the property.57
On the basis of its determination that respondents were the rightful owners
of the property, the RTC declared that they had the right to possess it.58
Moreover, since petitioners were staying on the property by the mere
tolerance of the real owners, the trial court ruled that it was incumbent
upon them to vacate the land59 and to pay respondents for actual
damages caused by the dispossession.60
The CA Ruling
Petitioners sought the reversal of the RTC Decision, but the CA dismissed
the appeal for lack of merit.61 The appellate court agreed with the trial
court's ruling that respondents were the rightful owners of the property,
albeit on a different ground; that is, the invalidity of the donation propter
nuptias executed by Feliza in their favor:
The document captioned as Donation Property Nuptias does not show
that plaintiffs-appellants, as the donees, accepted the subject parcel of
land as a gift from the donor. Neither have the plaintiffs-appellants
presented any other document that would evidence such acceptance
and notification to the donor. Hence, it is our considered view that the
ownership over the subject parcel of land did not pass to plaintiffs-
appellants by reason of their failure to accept the donation as required
by law. And, by necessary consequence, considering that Felisa retained
the ownership over the subject parcel of land, she can validly sell the
same, as she did in 1982, in favor of defendants-appellees.62 (Emphases
omitted)
The CA also emphasized that respondents were purchasers in good faith,
as there was nothing in OCT No. 62276 itself or in the circumstances of the
sale that could have warned them that the property was being claimed
by others:
[E]very person dealing with registered land may safely rely on the
correctness of its certificate of title and the law will not oblige him to go
beyond what appears on the face thereof to determine the condition of
the property. This rule applies to defendants-appellees who are
purchasers in good faith of the subject parcel of land. There was nothing
in TCT No. 62276 or the circumstances surrounding the subject parcel of
land that could have warned or made them suspicious that other persons
have a claim over the land. At the time they purchased the subject parcel
of land in 1982, the same remains covered by TCT No. 62276 in the name
of Felisa, and her co-owners, and the donation of the land by Felisa to
plaintiffs-appellants does not appear in said TCT. Likewise, as the trial court
found based on the evidence on record, only the ancestral house of
Felisa was standing on the subject parcel of land at the time the latter sold
it to defendants-appellees. In view thereof, the reliance of defendants-
appellees on TCT No. 62276 when they purchased the subject parcel of
land is supported by law. We also find no defect in the Deed of Absolute
Sale executed by Felisa and defendants-appellees, which effected the
transfer of ownership of the subject parcel of land from the former to the
latter.63
Petitioners sought reconsideration of the Decision, but the CA denied the
motion in its Resolution dated 14 December 2009.64
Proceedings before this Court
Petitioners filed a Petition for Review before this Court65 seeking the
reversal of the above CA Decision and Resolution. They contend that the
CA erred in declaring the donation propter nuptias invalid on the ground
of lack of acceptance by the donee. It allegedly made that declaration
even if the applicable provisions of the Civil Code did not impose that
requirement.66 They assert that since the donation had been validly
made, Feliza sold nothing to respondents in 1982, as she had already
divested herself of ownership over that same property in 1962.67
The Comment68 filed by respondents on the Petition in G.R. No. 190750
raises substantially the same arguments as those found in their Comment
in G.R. No. 188666.
Consolidation of Cases
Considering that the two Petitions involved identical parties litigating over
the same property, the two cases were consolidated by the Court in a
Resolution69 dated 17 March 2010. Petitioners were thereafter ordered to
file a consolidated reply to the Comments filed in both petitions.70
In their Consolidated Reply,71 petitioners point out that the two cases
involve not only the issue of possession, but also of ownership.72
Consequently, they argue that the findings of the lower courts on
possession were not controlling in this case.73 They also reiterate their
arguments on the validity of the donation in their favor.74
ISSUES
The consolidated Petitions present the following issues for resolution:
(1) Whether the CA erred in nullifying the donation propter nuptias
executed by Feliza in favor of petitioners because of the absence of an
express acceptance by the donee
(2) Whether the CA erred in declaring that respondents are the rightful
owners of the property
(3) Whether the CA erred in awarding the possession of the property to
respondents
OUR RULING
We DENY the Petitions.
While we disagree with certain pronouncements of the CA in respect of
the validity of donations propter nuptias, we affirm its ultimate conclusion
that respondents are the rightful owners of the property and are
consequently entitled to possession thereof.
Written acceptance and notification to the donor are not required for
donations propter nuptias executed under the Civil Code.
Disposing of preliminary matter, we clarify our position with respect to the
pronouncement of the CA in G.R. No. 190750 that the donation propter
nuptias executed in favor of petitioners was invalid.
In the CA Decision affirming the RTC ruling in the action for quieting of title,
the appellate court invalidated the donation propter nuptias because of
petitioners' failure to comply with the formal requirement of acceptance.
The CA explained:
When applied to a donation of an immovable property, the law further
requires that the donation be made in a public document and that the
acceptance thereof be made in the same deed or in a separate public
instrument; in cases where the acceptance is made in a separate
instrument, it is mandated that the donor be notified thereof in an
authentic form, to be noted in both instruments. The acceptance of the
donation by the done is indispensable. Where the deed of donation fails
to show the acceptance, or where the formal notice of the acceptance,
made in a separate instrument, is either not given to the donor or else not
noted in the deed of donation and in the separate acceptance, the
donation is null and void.
The document captioned as Donation Propter Nuptias does not show that
plaintiffs-appellants, as the donees, accepted the subject parcel of land
as a gift from the donor. Neither have plaintiffs-appellants presented any
other document that would evidence such acceptance and notification
to the donor. Hence, it is our considered view that the ownership over the
subject parcel of land did not pass to plaintiffs-appellants by reason of
their failure to accept the donation as required by law. And, by necessary
consequence, considering that Felisa retained the ownership over the
subject parcel of land, she can validly sell the same, as she did in 1982, in
favor of defendants-appellees.75 (Emphases in the original)
We note that petitioners do not deny that they never accepted the
donation in their favor. They insist, though, that acceptance of the gift was
not required, since the donation propter nuptias was executed on 30 May
1962, or while the Civil Code was still in effect.76 Thus, they contend that
the CA erred in applying the ordinary rules of donation to the instrument
herein,77 when the applicable provisions were in fact Articles 126 to 134
of the Civil Code.
We agree with petitioners on this point.
It is settled that only laws existing at the time of the execution of a contract
are applicable thereto.78 The donation propter nuptias in this case was
executed on 30 May 1962,79 while the provisions on such donations under
the Civil Code were still in force and before the Family Code took effect
on 3 August 1988. The formal requisites for the validity of the donation
should therefore be determined in accordance with the following
provisions of the Civil Code:
ARTICLE 126. Donations by reason of marriage are those which are made
before its celebration, in consideration of the same and in favor of one or
both of the future spouses.
ARTICLE 127. These donations are governed by the rules on ordinary
donations established in Title III of Book III, except as to their form which
shall be regulated by the Statute of Frauds; and insofar as they are not
modified by the following articles.
ARTICLE 129. Express acceptance is not necessary for the validity of these
donations.
In Valencia v. Locquiao,80 we explained the effect of these Civil Code
provisions on the formal requirements for donations propter nuptias:
Unlike ordinary donations, donations propter nuptias or donations by
reason of marriage are those "made before its celebration, in
consideration of the same and in favor of one or both of the future
spouses." The distinction is crucial because the two classes of donations
are not governed by exactly the same rules, especially as regards the
formal essential requisites.
xxxx
Under the New Civil Code, the rules are different. Article 127 thereof
provides that the form of donations propter nuptias are [sic] regulated by
the Statute of Frauds. Article 1403, paragraph 2, which contains the
Statute of Frauds requires that the contracts mentioned thereunder need
be in writing only to be enforceable. However, as provided in Article 129,
express acceptance "is not necessary for the validity of these donations."
Thus, implied acceptance is sufficient.81 (Emphases supplied)
Given that this old rule governs this case, it is evident that the CA
erroneously invalidated the donation propter nuptias in favor of
petitioners. The absence of proof that the gift was accepted in a public
instrument is not controlling, since implied acceptance - such as the
celebration of marriage and the annotation of this fact in the OCT82 -
must be deemed sufficient.
We must clarify that the foregoing rule applies only to donations propter
nuptias made prior to the Family Code (as in this case). At the time, Article
129 of the Civil Code allowed acceptance of those donations to be
made impliedly. Since that provision is no longer part of the current Family
Code, donations propter nuptias made thereafter are now subject to the
rules on ordinary donations83 including those on the formal requisites for
validity. As a result, donations of immovables under the Family Code,
including those made by reason of marriage, must now be expressly
accepted by the donee in a public instrument.84
The CA correctly ruled that respondents are the rightful owners of the
property.
The validity of the donation propter nuptias executed by Feliza in favor of
petitioners, however, does not detract from our ultimate conclusion that
respondents are the rightful owners of the property. On this point, we
agree with the CA that the prior unregistered donation does not bind
respondents, who are innocent purchasers for value. Hence, it correctly
declared them the rightful owners of the subject property.
The unregistered donation propter nuptias does not bind third persons.
Pursuant to Article 709 of the Civil Code, a11 rights over immovable
property must be duly inscribed or annotated on the Registry of Deeds
before they can affect the rights of third persons. The provision states:
Art. 709. The titles of ownership, or other rights over immovable property,
which are not duly inscribed or annotated in the Registry of Property shall
not prejudice third persons.
The same rule is enunciated in Presidential Decree No. (P.D.) 1529, or the
Property Registration Decree, specifically Sections 51 and 52 thereof,
which provide:
SECTION 51. Conveyance and other dealings by registered owner — x x x
But no deed, mortgage, lease, or other voluntary instn1ment, except a will
purporting to convey or affect registered land, shall take effect as a
conveyance or bind the land, but shall operate only as a contract
between the parties and as evidence of authority to the Register of Deeds
to make registration.
The act of registration shall be the operative act to convey or affect the
land insofar as third persons are concerned, x x x.

SECTION 52. Constructive notice upon registration. Every conveyance,
mortgage, lease, lien, attachment, order, judgment, instrument or entry
affecting registered land shall, if registered, filed or entered in the office
of the Register of Deeds for the province or city where the land to which
it relates lies, be constructive notice to all persons from the time of such
registering, filing or entering.
In Gonzales v. Court of Appeals, we explained the significance of the
foregoing provisions to unregistered donations as follows:85
From the foregoing provisions, it may be inferred that as between the
parties to a donation of an immovable property, all that is required is for
said donation to be contained in a public document. Registration is not
necessary for it to be considered valid and effective. However, in order to
bind third persons, the donation must be registered in the Registry of
Property (now Registry of Land Titles and Deeds). Although the non-
registration of a deed of donation shall not affect its validity, the necessity
of registration comes into play when the rights of third persons are
affected, as in the case at bar.
xxxx
It is undisputed in this case that the donation executed by Ignacio
Gonzales in favor of his grandchildren, although in writing and duly
notarized, has not been registered in accordance with law. For this
reason, it shall not be binding upon private respondents who did not
participate in said deed or had no actual knowledge thereof. Hence,
while the deed of donation is valid between the donor and the donees,
such deed, however, did not bind the tenants-farmers who were not
parties to the donation. As previously enunciated by this Court, non-
registration of a deed of donation does not bind other parties ignorant of
a previous transaction (Sales vs. Court of Appeals, 211 SCRA 858 [1992]).86
(Emphases supplied)
In this case, petitioners do not deny that the donation propter nuptias was
never registered. Applying the rule laid down in Gonzales, the
conveyance of the property in their favor is not considered binding on
third persons, who had no participation in the deed or any actual
knowledge thereof.87 The Court is convinced that respondents fall within
the scope of this rule.
The records of both the cases for ejectment and the quieting of title are
bereft of evidence of respondents' participation in or actual knowledge
of the deed. In fact, petitioners never made that assertion in any of their
submissions before the courts. Instead, they focused on their claim that
respondents were aware of the former's possession of the property.88
We emphasize, however, that in order for prior unregistered interest to
affect third persons despite the absence of registration, the law requires
actual knowledge of that interest. Nothing less would suffice. As we
explained in Pineda v. Arcalas,89 mere possession of the property is not
enough:
True, that notwithstanding the preference given to a registered lien, this
Court has made an exception in a case where a party has actual
knowledge of the claimant's actual, open, and notorious possession of the
disputed property at the time the levy or attachment was registered. In
such situations, the actual notice and knowledge of a prior unregistered
interest, not the mere possession of the disputed property, was held to be
equivalent to registration.
Lamentably, in this case, Pineda did not even allege, much less prove,
that Arcalas had actual knowledge of her claim of ownership and
possession of the property at the time the levy was registered. The records
fail to show that Arcalas knew of Pineda's claim of ownership and
possession prior to Pineda's filing of her third party claim before the
Quezon City RTC. Hence, the mere possession of the subject property by
Pineda, absent any proof that Arcalas had knowledge of her possession
and adverse claim of ownership of the subject property, cannot be
considered as equivalent to registration.90
In the absence of proof that respondents participated in the transaction,
or had knowledge of petitioners' interest over the land at the time the
property was purchased in 1982, this Court must rule that they are not
bound by the unregistered donation.91 Hence, the conveyance had no
effect as to respondents.
Respondents are innocent purchasers for value.
The acquisition of the property by respondents must likewise be respected
because they were innocent purchasers for value. They had every right
to rely on OCT No. 62276 insofar as it indicated that (1) one-fourth of the
property was owned by Feliza; and (2) the land was subject only to the
encumbrances annotated on the title, which did not include the
donation propter nuptias in favor of petitioners.
Our ruling is rooted in the general principle that persons dealing with
registered land have the right to completely rely on the Torrens title issued
over the property.92 Buyers are not required to go beyond what the
certificate of title indicates on its face,93 provided the acquisition of the
land is made in good faith, that is, without notice that some other person
has a right to, or interest in, the property.
Nevertheless, the protection granted by law to innocent purchasers for
value is not absolute. In Lausa v. Quilaton,94 the Court explained:
Jurisprudence has established exceptions to the protection granted to an
innocent purchaser for value, such as when the purchaser has actual
knowledge of facts and circumstances that would compel a reasonably
cautious man to inquire into the status of the lot; or of a defect or the lack
of title in his vendor; or of sufficient facts to induce a reasonably prudent
man to inquire into the status of the title of the property in litigation.
The presence of anything that excites or arouses suspicion should then
prompt the vendee to look beyond the certificate and investigate the
title of the vendor appearing on the face of the certificate. One who falls
within the exception can neither be denominated as innocent purchaser
for value nor a purchaser in good faith, and hence does not merit the
protection of the law.
In particular, the Court has consistently held that that a buyer of a piece
of land that is in the actual possession of persons other than the seller must
be wary and should investigate the rights of those in possession. Without
such inquiry, the buyer can hardly be regarded as a buyer in good faith.95
Here, petitioners maintain that they had prior physical possession of the
land, and that they built permanent structures thereon even before
respondents' acquisition of the property from Feliza. Citing the findings of
the MTC during the ocular inspection conducted in G.R. No. 188666,
petitioners argue that the pem1anent structures and the trees found on
the disputed property prove their possession thereof over a considerable
period of time.96 They insist that respondents cannot feign ignorance of
these facts; hence, the latter cannot claim to be innocent purchasers for
value.97
We are not persuaded.
The Court notes that petitioners have failed to sufficiently establish their
assertion. Notably, the RTC in both the cases for ejectment and quieting
of title declared that it was respondent Arturo Cano who was in possession
of the property as a tenant prior to and at the time of the sale in 1982,
based on the annotation on the title to the property (OCT No. 62276).
In its Decision dated 27 May 2008, the RTC in G.R. No. 190750 dismissed the
case filed by petitioners for quieting of title on the basis of the following
findings of fact:
x x x The annotation on TCT no. 62276 in 1982 that defendant Arturo Cano
is the tenant of the subject parcel of land would show that indeed it was
defendant Arturo Cano who possessed and took care of the land prior to
the said year until he purchased the same in 1982. Defendants, after the
sale[,] had declared the subject property for taxation purposes in their
names. Likewise, from 1982 up to 2005, defendants religiously paid the
realty tax due from (sic) the subject property. Their possession however
was disturbed in 1999, the year he was disallowed entry by the plaintiffs.
Aside from defendants' registered ownership over the parcel of land in
question, the tax declaration and annual tax payments bolster the fact of
their ownership of the subject lot.
xxxx
x x x The Court further notes that prior to defendants' purchase of the land,
they were the ones tilling the subject land as tenants. Clearly, therefore,
prior to 1982 and thereafter, defendants were in possession of the subject
land as tenants and thereafter as registered owners. Their possession,
however, was disturbed in 1999 when plaintiffs, who as established are
staying on the subject lot upon the tolerance of the defendants were
disallowed entry by the former.98 (Emphasis supplied)
On the other hand, the RTC in G.R. No. 188666 ordered the ejectment of
petitioners from the property, upon a finding that respondents had been
in continuous possession of the land even prior to their purchase thereof
in 1982:
Not only that, the annotation on the said title says that that portion
pertaining to the appellant, before and at the time he was ousted by the
defendants-appellees, was in possession of the property, first as a tenant
prior to 1982 and as the owner thereof from 1982 onwards.
xxxx
x x x Likewise, from 1982 up to 2005, plaintiffs-appellants religiously paid
the realty tax due from the subject property. The plaintiffs-appellants have
explained on the observation of this Court that prior to the purchase
plaintiffs-appellants were already in possession at that time, being the
tenants thereof. Their possession however was disturbed in October 3,
1999, the day plaintiff-appellant Arturo was disallowed entry by the
defendants-appellees. Aside from plaintiffs-appellants' registered
ownership over the parcel of land in question, the tax declaration and tax
payments bolster the fact of their ownership of the subject lot.99
(Emphases supplied)
In their petition, petitioners allude to three semi-concrete houses and
several trees currently standing on the land as evidence of their possession
thereof. However, they have failed to prove that these structures were
already in place at the time of the sale in 1982. In fact, the RTC and the
CA in the case for quieting of title declared that the only house standing
on the property was the ancestral house of the seller, Feliza, when the
Deed of Sale was executed. The RTC declared:
Moreover, as established by evidence, the house on which plaintiffs stay
was once the ancestral house of the family of Felissa Baun. It was likewise
the only house standing on the land in question until the dispute between
the parties arose in 1999.100 x x x. (Emphasis supplied)
This finding was affirmed by the CA in its Decision dated 30 September
2009:
At the time they purchased the subject parcel of land in 1982, the same
remains covered by TCT No. 62276 in the name of Felisa, and her co-
owners, and the donation of the land by Felisa to plaintiffs-appellants
does not appear in said TCT. Likewise, as the trial court found based on
the evidence on record, only the ancestral house of Felisa was standing
on the subject parcel of land at the time the latter sold it to defendants-
appellees.101 (Emphasis supplied)
We find no reason to overturn the foregoing factual findings.
It must be emphasized that the Petitions before us were filed under Rule
45 of the Rules of Court. As such, our mandate is limited to only a review
of errors of law.102 It is not our place to analyze the factual findings of the
lower courts and weigh the evidence all over again.103 At most, our
inquiry should only pertain to whether these findings are sufficiently
supported by evidence.
In this case, the determinations made by the CA and the RTC as to the
party in possession of the property, and the structures standing on the land
at a specific point of time, are entitled to deference. These factual
determinations are supported by the annotation on OCT No. 62276, the
tax declarations submitted by petitioners and other pieces of evidence
that show that only the ancestral house of the seller was standing on the
land.
Considering that the factual findings of the lower courts are consistent
with the evidence on record, we affirm their conclusion that respondents
are innocent purchasers for value who had no reason to investigate
further or to go beyond what was stated in the OCT. Having acquired the
land in good faith, respondents' claim of ownership must be upheld.
Acquisitive prescription does not apply to registered land.
The assertion of petitioners that they acquired ownership of the property
by virtue of their open, continuous, adverse and exclusive possession
thereof for more than 60 years104 is likewise untenable.
As early as 1902, when Act No. 496 created the Torrens system of
registration, the law already declared that registered land cannot be
acquired by prescription or adverse possession.105 This principle is
currently found in Section 47 of P.D. 1529:
Section 47. Registered land not subject to prescriptions. No title to
registered land in derogation to that of the registered owner shall be
acquired by prescription or adverse possession.
It is undisputed that the subject property is registered land. Hence, even
assuming that petitioners occupied it for a considerable period after the
sale, their possession could not have ever ripened into ownership.
Respondents are entitled to possession of the property.
In view of our ruling in favor of respondents on the issue of ownership, we
likewise conclude that they are entitled to possession of the land in
question. They have the right to enjoy and dispose of it without limitations
other than those imposed by law.106
Our ruling on ownership also renders immaterial the issue of tolerance
raised by petitioners. Since their supposed title over the land - based on
the donation propter nuptias and on their claim of acquisitive prescription
- has been defeated by the registered Deed of Absolute Sale, petitioners
clearly have no right to remain on the property. Regardless of whether or
not their prior possession of the property had been tolerated by
respondents, it is evident that petitioners must now vacate the land.
Accordingly, we rule that the CA committed no reversible error in
declaring respondents as the rightful owners of the land in the action for
the quieting of title; and in ordering petitioners to vacate the property in
the ejectment case.
As a final point, the Court is aware that our ruling will affect the structures
currently standing on the property, which petitioners claim to own. Our
decision may then engender certain issues of accession, particularly the
right to reimbursement of expenses and payment of damages.
Unfortunately, these matters were not raised by any of the parties before
this Court or any of the lower courts. The dearth of evidence on this point
likewise prevents us from making any pronouncement on the matter.
These questions must perforce be dealt with in another proceeding.
WHEREFORE, the Petitions are DENIED. The Court of Appeals Decision and
Resolution dated 29 April 2009 and 3 July 2009, respectively, in CA-G.R. SP
No. 104200, and the Decision and Resolution dated 30 September 2009
and 14 December 2009, respectively, in CA-G.R. CV No. 91587 are hereby
AFFIRMED.
SO ORDERED.
G.R. No. 183719 February 2, 2011
MARGARITA F. CASTRO, Petitioner,
vs.
NAPOLEON A. MONSOD, Respondent.
DECISION
NACHURA, J.:
Before the Court is a petition for review on certiorari under Rule 45 of the
Rules of Court, assailing the Decision1 dated May 25, 2007 and the
Resolution2 dated July 14, 2008 of the Court of Appeals (CA) in CA-G.R.
CV No. 83973.
The antecedents of the case are as follows:
Petitioner is the registered owner of a parcel of land located on Garnet
Street, Manuela Homes, Pamplona, Las Piñas City, and covered by
Transfer Certificate of Title (TCT) No. T-36071, with an area of one hundred
thirty (130) square meters (sq.m.). Respondent, on the other hand, is the
owner of the property adjoining the lot of petitioner, located on Lyra
Street, Moonwalk Village, Phase 2, Las Piñas City. There is a concrete
fence, more or less two (2) meters high, dividing Manuela Homes from
Moonwalk Village.3
On February 29, 2000, respondent caused the annotation of an adverse
claim against sixty-five (65) sq.m. of the property of petitioner covered by
TCT No. T-36071. The adverse claim was filed without any claim of
ownership over the property. Respondent was merely asserting the
existing legal easement of lateral and subjacent support at the rear
portion of his estate to prevent the property from collapsing, since his
property is located at an elevated plateau of fifteen (15) feet, more or
less, above the level of petitioner’s property.4 Respondent also filed a
complaint for malicious mischief and malicious destruction before the
office of the barangay chairman.5
In defiance, petitioner filed a complaint for damages with temporary
restraining order/writ of preliminary injunction before the Regional Trial
Court (RTC) of Las Piñas City. Petitioner also prayed that the Register of
Deeds of Las Piñas City be ordered to cancel the annotation of the
adverse claim on TCT No. T-36071.6
Prior to the filing of the case before the RTC, there were deposits of soil
and rocks about two (2) meters away from the front door of the house of
petitioner. As such, petitioner was not able to park her vehicle at the
dead-end portion of Garnet Street. When petitioner noticed a leak that
caused the front portion of her house to be slippery, she hired construction
workers to see where the leak was coming from. The workers had already
started digging when police officers sent by respondent came and
stopped the workers from finishing their job.7
Petitioner averred that when she bought the property from Manuela
Homes in 1994, there was no annotation or existence of any easement
over the property. Respondent neither asked permission nor talked to her
with regard to the use of 65 sq.m. of her property as easement. Upon
learning of the adverse claim, she felt disturbed and experienced
sleepless nights for fear that she would not be able to sell her property.
Petitioner admitted that TCT No. 36071 does not cover the open space at
the dead-end portion of Garnet Street.8
For his part, respondent claimed that he and his family had been residing
in Moonwalk Village since June 1984. Adjacent to his property is the land
of petitioner in Manuela Homes. When he bought the property in 1983,
the land elevation of Moonwalk Village was almost on the same level as
Manuela Homes. However, sometime in 1985 and 1986, Pilar
Development Corporation, the developer of Manuela Homes, bulldozed,
excavated, and transferred portions of the elevated land to the lower
portions of Manuela Homes. Thus, Manuela Homes became lower than
Moonwalk Village.9
Before the said excavation, respondent personally complained to Pilar
Development Corporation and was assured that, as provided by the
National Building Code, an embankment will be retained at the boundary
of Manuela Homes and Moonwalk Village, which is more or less fifteen
(15) feet higher than Manuela Homes.10
Manuela Homes retained the embankment consisting of soil and rocks.
Respondent had the open space riprapped with stones as reinforcement
against any potential soil erosion, earthquake, and possible digging by
any person.
Respondent asserted that the affidavit of adverse claim was for the
annotation of the lateral and subjacent easement of his property over the
property of petitioner, in view of the latter’s manifest determination to
remove the embankment left by the developer of Manuela Homes.
On October 11, 2004, the RTC rendered a decision,11 the dispositive
portion of which reads:
WHEREFORE, premises considered, this court hereby renders judgment: (1)
ordering the cancellation of [respondent’s] adverse claim at the back of
Transfer Certificate of Title No. T-36071 at the expense of [respondent]
Napoleon Monsod; (2) ordering the said [respondent] to pay the herein
[petitioner] the amount of Php50,000.00 as moral damages; and (3)
dismissing [petitioner’s] claim for actual damages, attorney’s fees,
litigation costs and costs of suit and [respondent’s] compulsory
counterclaim for lack of merit.
SO ORDERED.12
The trial court ratiocinated that the adverse claim of respondent was non-
registrable considering that the basis of his claim was an easement and
not an interest adverse to the registered owner, and neither did he
contest the title of petitioner. Furthermore, the adverse claim of
respondent failed to comply with the requisites provided under Section 70
of Presidential Decree No. 1529.13
On appeal, the CA reversed the decision of the trial court in a Decision14
dated May 25, 2007, the fallo of which reads:
WHEREFORE, premises considered, the instant appeal is GRANTED. The
Decision of the Regional Trial Court, Branch 198, Las Piñas City dated
October 11, 2004 is REVERSED and SET ASIDE. The Court hereby orders the
retention of the annotation at the back of Transfer Certificate of Title No.
T-36071, not as an adverse claim, but a recognition of the existence of a
legal easement of subjacent and lateral support constituted on the
lengthwise or horizontal land support/embankment area of sixty-five (65)
square meters, more or less, of the property of [petitioner] Margarita
Castro. The writ of preliminary injunction issued by this Court on April 18,
2006 is hereby made permanent. [Petitioner’s] claim for damages is
likewise DISMISSED.
SO ORDERED.15
The CA ruled that while respondent’s adverse claim could not be
sanctioned because it did not fall under the requisites for registering an
adverse claim, the same might be duly annotated in the title as
recognition of the existence of a legal easement of subjacent and lateral
support. The purpose of the annotation was to prevent petitioner from
making injurious excavations on the subject embankment as to deprive
the residential house and lot of respondent of its natural support and
cause it to collapse. Respondent only asked that petitioner respect the
legal easement already existing thereon.16
On June 15, 2007, petitioner filed a motion for reconsideration. However,
the CA denied the same in a Resolution17 dated July 14, 2008.
Hence, this petition.
The issue in this case is whether the easement of lateral and subjacent
support exists on the subject adjacent properties and, if it does, whether
the same may be annotated at the back of the title of the servient estate.
Article 437 of the Civil Code provides that the owner of a parcel of land is
the owner of its surface and of everything under it, and he can construct
thereon any works, or make any plantations and excavations which he
may deem proper. However, such right of the owner is not absolute and
is subject to the following limitations: (1) servitudes or easements,18 (2)
special laws,19 (3) ordinances,20 (4) reasonable requirements of aerial
navigation,21 and (5) rights of third persons.22
Respondent filed before the RTC an affidavit of adverse claim, the
pertinent portions of which read:
5. That our adverse claim consists of rights of legal or compulsory
easement of lateral and subjacent support (under the Civil Code) over a
portion of the above-described property of owner Margarita F. Castro,
that is, covering the lengthwise or horizontal land support/embankment
area of sixty-five (65) square meters, more or less.
6. That said registered owner has attempted to destroy and/or remove
portions of the existing lateral/subjacent land and cement supports
adjoining the said two properties. In fact, a portion of the easement was
already destroyed/removed, to the continuing prejudice of herein
adverse claimant, and that a formal complaint against said registered
owner was filed by the herein adverse claimant before the Office of the
Barangay Chairman of Talon V, Las Piñas City and the same proved
futile.23
Respondent’s assertion that he has an adverse claim over the 65 sq.m.
property of petitioner is misplaced since he does not have a claim over
the ownership of the land. The annotation of an adverse claim over
registered land under Section 70 of Presidential Decree 152924 requires a
claim on the title of the disputed land. Annotation is done to apprise third
persons that there is a controversy over the ownership of the land and to
preserve and protect the right of the adverse claimant during the
pendency of the controversy. It is a notice to third persons that any
transaction regarding the disputed land is subject to the outcome of the
dispute.25
In reality, what respondent is claiming is a judicial recognition of the
existence of the easement of subjacent and lateral support over the 65
sq. m. portion of petitioner’s property covering the land
support/embankment area. His reason for the annotation is only to
prevent petitioner from removing the embankment or from digging on the
property for fear of soil erosion that might weaken the foundation of the
rear portion of his property which is adjacent to the property of petitioner.
An easement or servitude is an encumbrance imposed upon an
immovable for the benefit of another immovable belonging to a different
owner.26 There are two kinds of easements according to source. An
easement is established either by law or by will of the owners.27 The courts
cannot impose or constitute any servitude where none existed. They can
only declare its existence if in reality it exists by law or by the will of the
owners. There are therefore no judicial easements.28
Article 684 of the Civil Code provides that no proprietor shall make such
excavations upon his land as to deprive any adjacent land or building of
sufficient lateral or subjacent support. An owner, by virtue of his surface
right, may make excavations on his land, but his right is subject to the
limitation that he shall not deprive any adjacent land or building of
sufficient lateral or subjacent support. Between two adjacent landowners,
each has an absolute property right to have his land laterally supported
by the soil of his neighbor, and if either, in excavating on his own premises,
he so disturbs the lateral support of his neighbor’s land as to cause it, or,
in its natural state, by the pressure of its own weight, to fall away or slide
from its position, the one so excavating is liable.29
In the instant case, an easement of subjacent and lateral support exists in
favor of respondent.1avvphi1 It was established that the properties of
petitioner and respondent adjoin each other. The residential house and
lot of respondent is located on an elevated plateau of fifteen (15) feet
above the level of petitioner’s property. The embankment and the
riprapped stones have been in existence even before petitioner became
the owner of the property. It was proven that petitioner has been making
excavations and diggings on the subject embankment and, unless
restrained, the continued excavation of the embankment could cause
the foundation of the rear portion of the house of respondent to collapse,
resulting in the destruction of a huge part of the family dwelling.30
We sustain the CA in declaring that a permanent injunction on the part of
petitioner from making injurious excavations is necessary in order to
protect the interest of respondent. However, an annotation of the
existence of the subjacent and lateral support is no longer necessary. It
exists whether or not it is annotated or registered in the registry of property.
A judicial recognition of the same already binds the property and the
owner of the same, including her successors-in-interest. Otherwise, every
adjoining landowner would come to court or have the easement of
subjacent and lateral support registered in order for it to be recognized
and respected.
WHEREFORE, in view of the foregoing, the Decision dated May 25, 2007
and the Resolution dated July 14, 2008 of the Court of Appeals in CA-G.R.
CV No. 83973 are hereby AFFIRMED WITH MODIFICATION that the
annotation at the back of Transfer Certificate of Title No. T-36071,
recognizing the existence of the legal easement of subjacent and lateral
support constituted on the lengthwise or horizontal land
support/embankment area of sixty-five (65) square meters, more or less,
of the property of petitioner Margarita F. Castro, is hereby ordered
removed.
SO ORDERED.
G.R. No. 172804 January 24, 2011
GONZALO VILLANUEVA, represented by his heirs, Petitioner,
vs.
SPOUSES FROILAN and LEONILA BRANOCO, Respondents.
DECISION
CARPIO, J.:
The Case
This resolves the petition for review1 of the ruling2 of the Court of Appeals
dismissing a suit to recover a realty.
The Facts
Petitioner Gonzalo Villanueva (petitioner), here represented by his heirs,3
sued respondents, spouses Froilan and Leonila Branoco (respondents), in
the Regional Trial Court of Naval, Biliran (trial court) to recover a 3,492
square-meter parcel of land in Amambajag, Culaba, Leyte (Property)
and collect damages. Petitioner claimed ownership over the Property
through purchase in July 1971 from Casimiro Vere (Vere), who, in turn,
bought the Property from Alvegia Rodrigo (Rodrigo) in August 1970.
Petitioner declared the Property in his name for tax purposes soon after
acquiring it.
In their Answer, respondents similarly claimed ownership over the Property
through purchase in July 1983 from Eufracia Rodriguez (Rodriguez) to
whom Rodrigo donated the Property in May 1965. The two-page deed of
donation (Deed), signed at the bottom by the parties and two witnesses,
reads in full:
KNOW ALL MEN BY THESE PRESENTS:
That I, ALVEGIA RODRIGO, Filipino, of legal age, widow of the late Juan
Arcillas, a resident of Barrio Bool, municipality of Culaba, subprovince of
Biliran, Leyte del Norte, Philippines, hereby depose and say:
That as we live[d] together as husband and wife with Juan Arcillas, we
begot children, namely: LUCIO, VICENTA, SEGUNDINA, and ADELAIDA, all
surnamed ARCILLAS, and by reason of poverty which I suffered while our
children were still young; and because my husband Juan Arcillas aware
as he was with our destitution separated us [sic] and left for Cebu; and
from then on never cared what happened to his family; and because of
that one EUFRACIA RODRIGUEZ, one of my nieces who also suffered with
our poverty, obedient as she was to all the works in our house, and
because of the love and affection which I feel [for] her, I have one parcel
of land located at Sitio Amambajag, Culaba, Leyte bearing Tax Decl. No.
1878 declared in the name of Alvegia Rodrigo, I give (devise) said land in
favor of EUFRACIA RODRIGUEZ, her heirs, successors, and assigns together
with all the improvements existing thereon, which parcel of land is more
or less described and bounded as follows:
1. Bounded North by Amambajag River; East, Benito Picao; South, Teofilo
Uyvico; and West, by Public land; 2. It has an area of 3,492 square meters
more or less; 3. It is planted to coconuts now bearing fruits; 4. Having an
assessed value of ₱240.00; 5. It is now in the possession of EUFRACIA
RODRIGUEZ since May 21, 1962 in the concept of an owner, but the Deed
of Donation or that ownership be vested on her upon my demise.
That I FURTHER DECLARE, and I reiterate that the land above described, I
already devise in favor of EUFRACIA RODRIGUEZ since May 21, 1962, her
heirs, assigns, and that if the herein Donee predeceases me, the same
land will not be reverted to the Donor, but will be inherited by the heirs of
EUFRACIA RODRIGUEZ;
That I EUFRACIA RODRIGUEZ, hereby accept the land above described
from Inay Alvegia Rodrigo and I am much grateful to her and praying
further for a longer life; however, I will give one half (1/2) of the produce
of the land to Apoy Alve during her lifetime.4
Respondents entered the Property in 1983 and paid taxes afterwards.
The Ruling of the Trial Court
The trial court ruled for petitioner, declared him owner of the Property, and
ordered respondents to surrender possession to petitioner, and to pay
damages, the value of the Property’s produce since 1982 until petitioner’s
repossession and the costs.5 The trial court rejected respondents’ claim of
ownership after treating the Deed as a donation mortis causa which
Rodrigo effectively cancelled by selling the Property to Vere in 1970.6
Thus, by the time Rodriguez sold the Property to respondents in 1983, she
had no title to transfer.
Respondents appealed to the Court of Appeals (CA), imputing error in
the trial court’s interpretation of the Deed as a testamentary disposition
instead of an inter vivos donation, passing title to Rodriguez upon its
execution.
Ruling of the Court of Appeals
The CA granted respondents’ appeal and set aside the trial court’s ruling.
While conceding that the "language of the [Deed is] x x x confusing and
which could admit of possible different interpretations,"7 the CA found the
following factors pivotal to its reading of the Deed as donation inter vivos:
(1) Rodriguez had been in possession of the Property as owner since 21
May 1962, subject to the delivery of part of the produce to Apoy Alve; (2)
the Deed’s consideration was not Rodrigo’s death but her "love and
affection" for Rodriguez, considering the services the latter rendered; (3)
Rodrigo waived dominion over the Property in case Rodriguez
predeceases her, implying its inclusion in Rodriguez’s estate; and (4)
Rodriguez accepted the donation in the Deed itself, an act necessary to
effectuate donations inter vivos, not devises.8 Accordingly, the CA
upheld the sale between Rodriguez and respondents, and, conversely
found the sale between Rodrigo and petitioner’s predecessor-in-interest,
Vere, void for Rodrigo’s lack of title.
In this petition, petitioner seeks the reinstatement of the trial court’s ruling.
Alternatively, petitioner claims ownership over the Property through
acquisitive prescription, having allegedly occupied it for more than 10
years.9
Respondents see no reversible error in the CA’s ruling and pray for its
affirmance.
The Issue
The threshold question is whether petitioner’s title over the Property is
superior to respondents’. The resolution of this issue rests, in turn, on
whether the contract between the parties’ predecessors-in-interest,
Rodrigo and Rodriguez, was a donation or a devise. If the former,
respondents hold superior title, having bought the Property from
Rodriguez. If the latter, petitioner prevails, having obtained title from
Rodrigo under a deed of sale the execution of which impliedly revoked
the earlier devise to Rodriguez.
The Ruling of the Court
We find respondents’ title superior, and thus, affirm the CA.
Naked Title Passed from Rodrigo to Rodriguez Under a Perfected Donation
We examine the juridical nature of the Deed – whether it passed title to
Rodriguez upon its execution or is effective only upon Rodrigo’s death –
using principles distilled from relevant jurisprudence. Post-mortem
dispositions typically –
(1) Convey no title or ownership to the transferee before the death of the
transferor; or, what amounts to the same thing, that the transferor should
retain the ownership (full or naked) and control of the property while alive;
(2) That before the [donor’s] death, the transfer should be revocable by
the transferor at will, ad nutum; but revocability may be provided for
indirectly by means of a reserved power in the donor to dispose of the
properties conveyed;
(3) That the transfer should be void if the transferor should survive the
transferee.10
Further –
[4] [T]he specification in a deed of the causes whereby the act may be
revoked by the donor indicates that the donation is inter vivos, rather than
a disposition mortis causa[;]
[5] That the designation of the donation as mortis causa, or a provision in
the deed to the effect that the donation is "to take effect at the death of
the donor" are not controlling criteria; such statements are to be
construed together with the rest of the instrument, in order to give effect
to the real intent of the transferor[;] [and]
(6) That in case of doubt, the conveyance should be deemed donation
inter vivos rather than mortis causa, in order to avoid uncertainty as to the
ownership of the property subject of the deed.11
It is immediately apparent that Rodrigo passed naked title to Rodriguez
under a perfected donation inter vivos. First. Rodrigo stipulated that "if the
herein Donee predeceases me, the [Property] will not be reverted to the
Donor, but will be inherited by the heirs of x x x Rodriguez," signaling the
irrevocability of the passage of title to Rodriguez’s estate, waiving
Rodrigo’s right to reclaim title. This transfer of title was perfected the
moment Rodrigo learned of Rodriguez’s acceptance of the disposition12
which, being reflected in the Deed, took place on the day of its execution
on 3 May 1965. Rodrigo’s acceptance of the transfer underscores its
essence as a gift in presenti, not in futuro, as only donations inter vivos
need acceptance by the recipient.13 Indeed, had Rodrigo wished to
retain full title over the Property, she could have easily stipulated, as the
testator did in another case, that "the donor, may transfer, sell, or
encumber to any person or entity the properties here donated x x x"14 or
used words to that effect. Instead, Rodrigo expressly waived title over the
Property in case Rodriguez predeceases her.
In a bid to diffuse the non-reversion stipulation’s damning effect on his
case, petitioner tries to profit from it, contending it is a fideicommissary
substitution clause.15 Petitioner assumes the fact he is laboring to prove.
The question of the Deed’s juridical nature, whether it is a will or a
donation, is the crux of the present controversy. By treating the clause in
question as mandating fideicommissary substitution, a mode of
testamentary disposition by which the first heir instituted is entrusted with
the obligation to preserve and to transmit to a second heir the whole or
part of the inheritance,16 petitioner assumes that the Deed is a will.
Neither the Deed’s text nor the import of the contested clause supports
petitioner’s theory.
Second. What Rodrigo reserved for herself was only the beneficial title to
the Property, evident from Rodriguez’s undertaking to "give one [half] x x
x of the produce of the land to Apoy Alve during her lifetime."17 Thus, the
Deed’s stipulation that "the ownership shall be vested on [Rodriguez] upon
my demise," taking into account the non-reversion clause, could only refer
to Rodrigo’s beneficial title. We arrived at the same conclusion in Balaqui
v. Dongso18 where, as here, the donor, while "b[inding] herself to answer
to the [donor] and her heirs x x x that none shall question or disturb [the
donee’s] right," also stipulated that the donation "does not pass title to
[the donee] during my lifetime; but when I die, [the donee] shall be the
true owner" of the donated parcels of land. In finding the disposition as a
gift inter vivos, the Court reasoned:
Taking the deed x x x as a whole, x x x x it is noted that in the same deed
[the donor] guaranteed to [the donee] and her heirs and successors, the
right to said property thus conferred. From the moment [the donor]
guaranteed the right granted by her to [the donee] to the two parcels of
land by virtue of the deed of gift, she surrendered such right; otherwise
there would be no need to guarantee said right. Therefore, when [the
donor] used the words upon which the appellants base their contention
that the gift in question is a donation mortis causa [that the gift "does not
pass title during my lifetime; but when I die, she shall be the true owner of
the two aforementioned parcels"] the donor meant nothing else than that
she reserved of herself the possession and usufruct of said two parcels of
land until her death, at which time the donee would be able to dispose
of them freely.19 (Emphasis supplied)
Indeed, if Rodrigo still retained full ownership over the Property, it was
unnecessary for her to reserve partial usufructuary right over it.20
Third. The existence of consideration other than the donor’s death, such
as the donor’s love and affection to the donee and the services the latter
rendered, while also true of devises, nevertheless "corroborates the
express irrevocability of x x x [inter vivos] transfers."21 Thus, the CA
committed no error in giving weight to Rodrigo’s statement of "love and
affection" for Rodriguez, her niece, as consideration for the gift, to
underscore its finding.
It will not do, therefore, for petitioner to cherry-pick stipulations from the
Deed tending to serve his cause (e.g. "the ownership shall be vested on
[Rodriguez] upon my demise" and "devise"). Dispositions bearing
contradictory stipulations are interpreted wholistically, to give effect to
the donor’s intent. In no less than seven cases featuring deeds of
donations styled as "mortis causa" dispositions, the Court, after going over
the deeds, eventually considered the transfers inter vivos,22 consistent
with the principle that "the designation of the donation as mortis causa,
or a provision in the deed to the effect that the donation is ‘to take effect
at the death of the donor’ are not controlling criteria [but] x x x are to be
construed together with the rest of the instrument, in order to give effect
to the real intent of the transferor."23 Indeed, doubts on the nature of
dispositions are resolved to favor inter vivos transfers "to avoid uncertainty
as to the ownership of the property subject of the deed."24
Nor can petitioner capitalize on Rodrigo’s post-donation transfer of the
Property to Vere as proof of her retention of ownership. If such were the
barometer in interpreting deeds of donation, not only will great legal
uncertainty be visited on gratuitous dispositions, this will give license to
rogue property owners to set at naught perfected transfers of titles, which,
while founded on liberality, is a valid mode of passing ownership. The
interest of settled property dispositions counsels against licensing such
practice.25
Accordingly, having irrevocably transferred naked title over the Property
to Rodriguez in 1965, Rodrigo "cannot afterwards revoke the donation nor
dispose of the said property in favor of another."26 Thus, Rodrigo’s post-
donation sale of the Property vested no title to Vere. As Vere’s successor-
in-interest, petitioner acquired no better right than him. On the other
hand, respondents bought the Property from Rodriguez, thus acquiring
the latter’s title which they may invoke against all adverse claimants,
including petitioner.
Petitioner Acquired No Title Over the Property
Alternatively, petitioner grounds his claim of ownership over the Property
through his and Vere’s combined possession of the Property for more than
ten years, counted from Vere’s purchase of the Property from Rodrigo in
1970 until petitioner initiated his suit in the trial court in February 1986.27
Petitioner anchors his contention on an unfounded legal assumption. The
ten year ordinary prescriptive period to acquire title through possession of
real property in the concept of an owner requires uninterrupted
possession coupled with just title and good faith.28 There is just title when
the adverse claimant came into possession of the property through one
of the modes recognized by law for the acquisition of ownership or other
real rights, but the grantor was not the owner or could not transmit any
right.29 Good faith, on the other hand, consists in the reasonable belief
that the person from whom the possessor received the thing was the
owner thereof, and could transmit his ownership.30
Although Vere and petitioner arguably had just title having successively
acquired the Property through sale, neither was a good faith possessor.
As Rodrigo herself disclosed in the Deed, Rodriguez already occupied
and possessed the Property "in the concept of an owner" ("como tag-
iya"31) since 21 May 1962, nearly three years before Rodrigo’s donation in
3 May 1965 and seven years before Vere bought the Property from
Rodrigo. This admission against interest binds Rodrigo and all those tracing
title to the Property through her, including Vere and petitioner. Indeed,
petitioner’s insistent claim that Rodriguez occupied the Property only in
1982, when she started paying taxes, finds no basis in the records. In short,
when Vere bought the Property from Rodrigo in 1970, Rodriguez was in
possession of the Property, a fact that prevented Vere from being a buyer
in good faith.
Lacking good faith possession, petitioner’s only other recourse to maintain
his claim of ownership by prescription is to show open, continuous and
adverse possession of the Property for 30 years.32 Undeniably, petitioner
is unable to meet this requirement.1avvphil
Ancillary Matters Petitioner Raises Irrelevant
Petitioner brings to the Court’s attention facts which, according to him,
support his theory that Rodrigo never passed ownership over the Property
to Rodriguez, namely, that Rodriguez registered the Deed and paid taxes
on the Property only in 1982 and Rodriguez obtained from Vere in 1981 a
waiver of the latter’s "right of ownership" over the Property. None of these
facts detract from our conclusion that under the text of the Deed and
based on the contemporaneous acts of Rodrigo and Rodriguez, the
latter, already in possession of the Property since 1962 as Rodrigo
admitted, obtained naked title over it upon the Deed’s execution in 1965.
Neither registration nor tax payment is required to perfect donations. On
the relevance of the waiver agreement, suffice it to say that Vere had
nothing to waive to Rodriguez, having obtained no title from Rodrigo.
Irrespective of Rodriguez’s motivation in obtaining the waiver, that
document, legally a scrap of paper, added nothing to the title Rodriguez
obtained from Rodrigo under the Deed.
WHEREFORE, we DENY the petition. We AFFIRM the Decision dated 6 June
2005 and the Resolution dated 5 May 2006 of the Court of Appeals.
SO ORDERED.
G.R. No. 122047 October 12, 2000
SPOUSES SERAFIN SI AND ANITA BONODE SI, petitioners,
vs.
COURT OF APPEALS, SPOUSES JOSE ARMADA and REMEDIOS ALMANZOR
(deceased, and substituted by heirs: Cynthia Armada, Danilo Armada
and Vicente Armada) respondents.
DECISION
QUISUMBING, J.:
This petition for certiorari under Rule 45 assails the Decision1 dated March
25, 1994, of the Court of Appeals and its Resolutions2 dated March 24,
1995 and September 6, 1995 in CA-G.R. CV No. 30727. The Court of
Appeals reversed the decision of the Regional Trial Court of Pasig City,
Branch 113, and nullified the sale of the subject lot by the spouses
Crisostomo and Cresenciana Armada to spouses Serafin and Anita Si. The
dispositive portion of the respondent court's decision reads:
"WHEREFORE, in view of the foregoing, the decision appealed from is
hereby REVERSED, and a new one is rendered:
1) Annulling and declaring as invalid the registration of the Deed of
Absolute Sale dated March 27, 1979 executed by Cresenciana V. Alejo in
favor of Anita Bonode Si.
2) Ordering the Register of Deeds of Pasay City to annul and cancel
Transfer Certificate of Title No. 24751, issued in the name of Anita Bonode
Si, married to Serafin D. Si., Jose R. Armada, married to Remedios Almanzor
and Dr. Severo R. Armada Jr., single.
3) Ordering the Register of Deeds of Pasay City to reconstitute and revive
Transfer Certificate of Title No. 16007 in the names of Jose, Crisostomo and
Severo, Jr.
4) That plaintiffs be allowed to repurchase or redeem the share
corresponding to the share of Crisostomo Armada within thirty (30) days
from notice in writing by Crisostomo Armada.
5) The defendants-appellees are jointly and severally ordered to pay the
plaintiffs-appellants the sum of P10,000.00 as moral damages.
6) The defendants-appellees are jointly and severally ordered to pay the
plaintiff-appellants the sum of P10,000.00 as attorney's fees and litigation
expenses and costs of suit.
SO ORDERED."3
The factual background of the case is as follows:
The 340 square meters of land, situated in San Jose District, Pasay City, the
property in dispute, originally belonged to Escolastica, wife of Severo
Armada, Sr. This was covered by Transfer Certificate of Title (TCT) No.
(17345) 2460. During the lifetime of the spouses, the property was
transferred to their children and the Registry of Deeds, Pasay City, issued
TCT No. 16007 in the names of the three sons, as follows : "DR. CRISOSTOMO
R. ARMADA, married to Cresenciana V. Alejo, 113.34 Square Meters; JOSE
R. ARMADA, married to Remedios Almanzor, 113.33 Square Meters; and
DR. SEVERO R. ARMADA, Jr., single, all of legal age, Filipinos."4 Annotated
also in the title is the total cancellation of said title "... by virtue of the Deed
of Sale, (P.E. 77952/T-24751), dated March 28, 1979, executed by
CRESENCIANA V. ALEJO, as attorney-in-fact of CRISOSTOMO R. ARMADA,
conveying 113.34 square meters of the property herein, in favor of ANITA
BONODE SI, married to Serafin D. Si, for the sum of P75,000.00, issuing in lieu
thereof Transfer Certificate of Title No. 24751, Reg. Book T-102. (Doc. No.
17, Page No. 5, Book No. 253 of Notary Public of Pasay City, Manila, Julian
Florentino)."5
On April 15, 1980, herein spouses Jose Armada and Remedios Almanzor,
filed a complaint for Annulment of Deed of Sale and Reconveyance of
Title with Damages, against herein petitioners Anita and Serafin Si and
Conrado Isada, brother-in-law of Cresenciana. Isada brokered the sale.
The complaint alleged that Conrado Isada sold Crisostomo's share by
making it appear that Cresenciana, the attorney-in-fact of her husband,
is a Filipino citizen, residing with Isada at No. 13-4th Camarilla Street,
Murphy, Cubao, Quezon City. By this time, Crisostomo and Cresenciana
had migrated and were already citizens of the United States of America.
It also stated that when petitioners registered the deed of absolute sale
they inserted the phrase "... and that the co-owners are not interested in
buying the same in spite of notice to them.", and that petitioners knew of
the misrepresentations of Conrado. Further, the complaint alleged that
the other owners, Jose and Severo, Jr., had no written notice of the sale;
and that all upon learning of the sale to the spouses Si, private
respondents filed a complaint for annulment of sale and reconveyance
of title with damages, claiming they had a right of redemption.
Petitioners, on the other hand, alleged that on October 2, 1954,
Escolastica, with the consent of her husband executed three separate
deeds of sale (Exhibits 1, 2, and 3)6 conveying 113.34 square meters of the
property to Severo, and 113.33 square meters each to Crisostomo and
Jose. The three deeds of sale particularly described the portion conveyed
to each son in metes and bounds. Petitioners contend that since the
property was already three distinct parcels of land, there was no longer
co-ownership among the brothers. Hence, Jose and Severo, Jr. had no
right of redemption when Crisostomo sold his share to the spouses Si.
Petitioners point out that it was only because the Armada brothers failed
to submit the necessary subdivision plan to the Office of the Register of
Deeds in Pasay City that separate titles were not issued and TCT No. 16007
was issued and registered in the names of Jose, Crisostomo, and Severo,
Jr.
After trial on the merits, the court ruled for petitioners:
"IN VIEW OF ALL THE FOREGOING, the complaint is hereby DISMISSED. With
costs against the plaintiffs."7
Private respondents appealed to the Court of Appeals. On March 25,
1994, the appellate court issued the decision now assailed by petitioners.
In reversing the decision of the trial court and ruling for private
respondents, the Court of Appeals found that:
"A careful examination of TCT No. 16007 (Exh. 'A') shows that the portion
sold by virtue of the Deeds of Sale (Exh. 1, 2, & 3) to the Armada brothers
do not appear in the said title, neither does it indicate the particular area
sold. Moreover, no evidence was presented to show that the Register of
Deeds issued TCT No. 16007 (Exh. 'A') on the basis of the said deeds of Sale.
In fact, TCT No. 16007 (Exh. 'A') shows that the lot is co-owned by Jose,
Crisostomo and Severo, Jr. in the proportion of 113.33, 113.34 and 113.33
sq. m. respectively.
Furthermore, the evidence on record shows that the Deed of Absolute
Sale (Exh. 'B'), executed by Cresencia Armada in favor of defendants Si,
stated that the portion sold was the 'undivided one hundred thirteen &
34/100 (113.34) square meters' of the parcel of land covered by TCT NO.
16007 of the Registry of Deeds for Pasay City, which means that what was
sold to defendants are still undetermined and unidentifiable, as the area
sold remains a portion of the whole.
Moreover, plaintiff Remedi[o]s Armada testified that on March 27, 1979,
Crisostomo Armada, thru his attorney-in-fact and co-defendant,
Cresenciana Alejo, sold his undivided 113.34 share to defendants, Sps. Si
as evidenced by a Deed of Absolute Sale (Exh. 'B'), and presented for
registration with the Register of Deeds (Exh. 'B-1') without notifying plaintiffs
of the sale (TSN, pp. 6-8, December 20, 1988). Instead, it appears that the
phrase 'and that the co-owners are not interested in buying the same
inspite of notice to them', was inserted in the Deed of Sale (Exh. 'B').
xxx
Otherwise stated, the sale by a (sic) co-owner of his share in the undivided
property is not invalid, but shall not be recorded in the Registry Property,
unless accompanied by an affidavit of the Vendor that he has given
written notice thereof to all possible redemptioners."8
On August 29, 1994, petitioners' counsel on record, Atty. Roberto B. Yam
received a copy of the CA decision. On October 14, 1994, he filed a
motion for reconsideration, but it was denied by the Court of Appeals on
November 21, 1994, for being filed out of time.
On December 5, 1994, petitioners filed their motion for new trial under
Section 1, Rule 53 of the Revised Rules of Court.9 Petitioners presented
new evidence, TCT No. (17345) 2460, registered in the name of Escolastica
de la Rosa, married to Severo Armada, Sr., with annotation at the back
stating that the cancellation was by virtue of three deeds of sale in favor
of Escolastica's sons. On March 24, 1995, respondent court denied the
motion, reasoning that when the motion was filed, the reglementary
period had lapsed and the decision had become final and executory.
Petitioners' motion for reconsideration of said resolution was denied.
Hence, the present petition, alleging that:
"1. Respondent Court of Appeals committed a reversible error in ruling that
a co-ownership still existed.
"2. Respondent Court of Appeals committed a reversible error in denying
the Motion for Reconsideration of its Decision of 25 March 1994 on purely
technical grounds.
"3. Respondent Court of Appeals committed a reversible error in denying
the Motion for New Trial.
"4. Respondent Court of Appeals committed a reversible error in ordering
petitioners to pay moral damages, attorney's fees, litigation expenses and
the costs of the suit."10
In essence, this Court is asked to resolve: (1) whether respondent court
erred in denying petitioners' motion for reconsideration and/or the Motion
for New Trial; (2) whether private respondents are co-owners who are
legally entitled to redeem the lot under Article 1623 of the Civil Code;11
and (3) whether the award of moral damages, attorney's fees and costs
of suit is correct.
The pivotal issue is whether private respondents may claim the right of
redemption under Art. 1623 of the Civil Code. The trial court found that
the disputed land was not part of an undivided estate. It held that the
three deeds of absolute sale12 technically described the portion sold to
each son. The portions belonging to the three sons were separately
declared for taxation purposes with the Assessor's Office of Pasay City on
September 21, 1970.13 Jose's testimony that the land was undivided was
contradicted by his wife when she said they had been receiving rent from
the property specifically allotted to Jose.14 More significantly, on January
9, 1995, the Registry of Deeds of Pasay City cancelled TCT 24751 and
issued three new titles as follows: (1) TCT 13459415 in favor of Severo
Armada, Jr.; (2) TCT 13459516 under the name of Anita Bonode Si, married
to Serafin Si; and (3) TCT 13459617 owned by Jose Armada, married to
Remedios Almanzor. All these are on record.
However, the Court of Appeals' decision contradicted the trial court's
findings.18
In instances when the findings of fact of the Court of Appeals are at
variance with those of the trial court, or when the inference drawn by the
Court of Appeals from the facts is manifestly mistaken, this Court will not
hesitate to review the evidence in order to arrive at the correct factual
conclusion.19 This we have done in this case. It is our considered view
now, that the trial court is correct when it found that:
"Rightfully, as early as October 2, 1954, the lot in question had already
been partitioned when their parents executed three (3) deed of sales (sic)
in favor of Jose, Crisostomo and Severo, all surnamed Armada (Exh. 1, 2,
& 3), which documents purports to have been registered with the Register
of Deeds of Pasay City, on September 18, 1970, and as a consequence
TCT No. 16007 (Exh. A) was issued. Notably, every portion conveyed and
transferred to the three sons was definitely described and segregated
and with the corresponding technical description (sic). In short, this is what
we call extrajudicial partition. Moreover, every portion belonging to the
three sons has been declared for taxation purposes with the Assessor's
Office of Pasay City on September 21, 1970. These are the unblinkable
facts that the portion sold to defendant spouses Si by defendants
Crisostomo Armada and Cresenciana Armada was concretely
determined and identifiable. The fact that the three portions are
embraced in one certificate of title does not make said portions less
determinable or identifiable or distinguishable, one from the other, nor
that dominion over each portion less exclusive, in their respective owners.
Hence, no right of redemption among co-owners exists."20 (citation
omitted)
". . . [T]he herein plaintiffs cannot deny the fact that they did not have
knowledge about the impending sale of this portion. The truth of the
matter is that they were properly notified. Reacting to such knowledge
and notification they wrote defendant Dr. Crisostomo Armada on
February 22, 1979, a portion of said letter is revealing: 'Well you are the
king of yourselves, and you can sell your share of Levereza."21 (emphasis
omitted)
After the physical division of the lot among the brothers, the community
ownership terminated, and the right of preemption or redemption for
each brother was no longer available.22
Under Art. 484 of the Civil Code,23 there is co-ownership whenever the
ownership of an undivided thing or right belongs to different persons.
There is no co-ownership when the different portions owned by different
people are already concretely determined and separately identifiable,
even if not yet technically described.24 This situation makes inapplicable
the provision on the right of redemption of a co-owner in the Civil Code,
as follows:
"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."
Moreover, we note that private respondent Jose Armada was well
informed of the impending sale of Crisostomo's share in the land. In a letter
dated February 22, 1979, Jose told his brother Crisostomo: "Well you are
the king of yourselves, and you can sell your share of Leveriza."25 Co-
owners with actual notice of the sale are not entitled to written notice. A
written notice is a formal requisite to make certain that the co-owners
have actual notice of the sale to enable them to exercise their right of
redemption within the limited period of thirty days. But where the co-
owners had actual notice of the sale at the time thereof and/or
afterwards, a written notice of a fact already known to them, would be
superfluous. The statute does not demand what is unnecessary.26
Considering that respondent Court of Appeals erred in holding that herein
private respondent could redeem the lot bought by petitioners, the issue
of whether the appellate court erred in denying petitioners' motions for
reconsideration and new trial need not be delved into.1âwphi1 The same
is true with respect to the questioned award of damages and attorney's
fees. Petitioners filed their complaint in good faith and as repeatedly held,
we cannot put a premium on the right to litigate.
WHEREFORE, the petition is GRANTED, the Decision of the Court of Appeals
dated March 25, 1994 and its Resolutions dated March 24, 1995 and
September 6, 1995 in CA-G.R. CV No. 30727 are ANNULLED and SET ASIDE.
Civil Case No. 8023-P is DISMISSED for lack of merit. The decision of the
Regional Trial Court of Pasay City, Branch 113, promulgated on August 29,
1989, is REINSTATED.
SO ORDERED.
G.R. No. 188213
NATIVIDAD C. CRUZ and BENJAMIN DELA CRUZ, Petitioners,
vs.
PANDACAN HIKER'S CLUB, INC., Represented by its President, PRISCILA
ILAO, Respondent.
DECISION
PERALTA, J.:
Before the Court is a petition for review on certiorari under Rule 45 of the
Rules of Court seeking to ahnul and set aside the Court of Appeals
Decision1 dated March 31, 2008 in CA-G.R. SP. No. 104474. The appellate
court reversed and set aside the earlier decision of the Office of the
Ombudsman dismissing the complaint filed against petitioners.
Below are the facts of the case.
Petitioner Natividad C. Cruz (Cruz) was Punong Barangay or Chairperson
of Barangay 848, Zone 92, City of Manila.2 On November 10, 2006, around
five o'clock in the afternoon, and along Central Street, Pandacan, Manila,
within the vicinity of her barangay, she allegedly confronted persons
playing basketball with the following statements:
Bakit nakabukas ang (basketball) court? Wala kayong karapatang
maglaro sa court na 'to, barangay namin ito! xxx xxx xxx Wala kayong
magagawa. Ako ang chairman dito. Mga walanghiya kayo, patay
gutom! Hindi ako natatakot! Kaya kong panagutan lahat!3
Then, she allegedly gave an order to the other petitioner, Barangay Tanod
Benjamin dela Cruz (Dela Cruz), to destroy the basketball ring by cutting
it up with a hacksaw which Dela Cruz promptly complied with, thus,
rendering the said basketball court unusable.4
The acts of petitioners prompted the filing of a Complaint (for Malicious
Mischief, Grave Misconduct, Conduct Prejudicial to the Best Interest of the
Service and Abuse of Authority)5 before the Prosecutor's Office and the
Office of the Ombudsman by the group that claims to be the basketball
court's owners, herein respondents Pandacan Hiker's Club, Inc. (PHC) and
its president Priscila Ilao (Ilao). In the complaint, they alleged that PHC, a
non-stock, non-profit civic organization engaged in "health, infrastructure,
sports and other so-called poverty alleviation activities" in the Pandacan
area of Manila, is the group that had donated, administered and
operated the subject basketball court for the Pandacan community until
its alleged destruction by petitioners.6
The complaint averred that the damage caused by petitioners was in the
amount of around P2,000.00. It was supported by the affidavits of ten (10)
members of PHC who allegedly witnessed the destruction. Meanwhile,
respondent Ilao added that the acts of petitioner Cruz, the Barangay
Chairperson, of ordering the cutting up of the basketball ring and uttering
abusive language were "unwarranted and unbecoming of a public
official."7
In answer to the complaint, Cruz alleged that the basketball court
affected the peace in the barangay and was the subject of many
complaints from residents asking for its closure. She alleged that the
playing court blocked jeepneys from passing through and was the site of
rampant bettings and fights involving persons from within and outside the
barangays. She claimed that innocent persons have been hurt and
property had been damaged by such armed confrontations, which often
involved the throwing of rocks and improvised "molotov" bombs. She also
averred that noise from the games caused lack of sleep among some
residents and that the place's frequent visitors used the community's
fences as places to urinate. Cruz maintained that the court's users never
heeded the barangay officials' efforts to pacify them and when the
basketball ring was once padlocked, such was just removed at will while
members of the complainants' club continued playing. When Cruz asked
for the PHC to return the steel bar and padlock, the request was simply
ignored, thus, prompting her to order Dela Cruz to destroy the basketball
ring. The destruction was allegedly also a response to the ongoing clamor
of residents to stop the basketball games.8 Cruz denied allegations that
she shouted invectives at the PHC members. In support of her answer,
Cruz attached copies of the complaints, a "certification" and letters of
barangay residents asking for a solution to the problems arising from the
disruptive activities on the said playing venue.9
After the parties' submission of their respective Position Papers,10 the
Office of the Ombudsman rendered its Decision11 dated April 26,
2007dismissing the complaint filed by Ilao, et al. The Ombudsman found
that the act of destroying the basketball ring was only motivated by Cruz
and Dela Cruz performing their sworn duty, as defined in the Local
Government Code.12 It found the act to be a mere response to the
clamor of constituents.13 The office found that though the cutting of the
ring was "drastic," it was done by the barangay officials within their lawful
duties, as the act was only the result of the unauthorized removal of and
failure to return the steel bar and padlock that were earlier placed
thereon.14 Neither did the office give credence to the allegation that
Cruz uttered invectives against the complainants' witnesses, noting that
the said witnesses are tainted by their personal animosity against the
barangay officials.15
After the Ombudsman's ruling dismissing the complaint filed against Cruz
and Dela Cruz, the complainants Ilao, et al. filed a petition for review
before the Court of Appeals praying for the latter court to nullify the
Ombudsman's decision.16 The petition's thesis was that any actions in
furtherance of the community's welfare must be approved by ordinance
and that unless a thing is a nuisance per se, such a thing may not be
abated via an ordinance and extrajudicially.17
Commenting on the petition for review, the Office of the Ombudsman,
through the Office of the Solicitor General, averred that Section 389 of the
Local Government Code, which defines the powers, duties and functions
of the punong barangay, among which are the power to enforce all laws
and ordinances applicable within the barangay and the power to
maintain public order in the barangay and, in pursuance thereof, to assist
the city or municipal mayor and the sanggunian members in the
performance of their duties and functions, does not require an ordinance
for the said official to perform said functions.18 The acts were also in
pursuance of the promotion of the general welfare of the community, as
mentioned in Section 16 of the Code.19
In its assailed Decision dated March 31, 2008, the Court of Appeals
reversed and set aside the decision of the Office of the Ombudsman. The
appellate court found petitioner Natividad C. Cruz liable for conduct
prejudicial to the best interest of the service and penalized her with a
suspension of six (6) months and one (1) day, while it reprimanded the
other petitioner Benjamin dela Cruz, and also warned both officials that a
future repetition of the same or similar acts will be dealt with more
severely.
The appellate court sustained the contentions of Ilao, et al. that Cruz and
Dela Cruz performed an abatement of what they thought was a public
nuisance but did the same without following the proper legal procedure,
thus making them liable for said acts.20 It held Cruz to be without the
power to declare a thing a nuisance unless it is a nuisance per se.21 It
declared the subject basketball ring as not such a nuisance and, thus, not
subject to summary abatement. The court added that even if the same
was to be considered a nuisance per accidens, the only way to establish
it as such is after a hearing conducted for that purpose.22
A motion for reconsideration filed by Cruz and Dela Cruz was likewise
denied by the appellate court.23 Hence, they filed this petition.
Petitioners maintain that they acted merely with the intention to regain
free passage of people and vehicles over the street and restore the
peace, health and sanitation of those affected by the basketball court.
Cruz, in particular, asserts that she merely abated a public nuisance which
she claimed was within her power as barangay chief executive to perform
and was part of her duty to maintain peace and order.24
We deny the petition.
Under normal circumstances, this Court would not disturb the findings of
fact of the Office of the Ombudsman when they are supported by
substantial evidence.25 However, We make an exception of the case at
bar because the findings of fact of the Ombudsman and the Court of
Appeals widely differ.26
It is held that the administrative offense of conduct prejudicial to the
interest of the service is committed when the questioned conduct
tarnished the image and integrity of the officer's public office; the
conduct need not be related or connected to the public officer's official
functions for the said officer to be meted the corresponding penalty.27
The basis for such liability is Republic Act No. 6713, or the Code of Conduct
and Ethical Standards for Public Officials and Employees, particularly
Section 4 (c) thereof, which ordains that public officials and employees
shall at all times respect the rights of others, and shall refrain from doing
acts contrary to public safety and public interest.28 In one case, this Court
also stated that the Machiavellian principle that "the end justifies the
means" has no place in government service, which thrives on the rule of
law, consistency and stability.29
For these reasons, in the case at bar, We agree with the appellate court
that the petitioners’ actions, though well-intentioned, were improper and
done in excess of what was required by the situation and fell short of the
aforementioned standards of behavior for public officials.
It is clear from the records that petitioners indeed cut or sawed in half the
subject basketball ring, which resulted in the destruction of the said
equipment and rendered it completely unusable.30 Petitioners also
moved instantaneously and did not deliberate nor consult with the
Sangguniang Barangay prior to committing the subject acts; neither did
they involve any police or law enforcement agent in their actions. They
acted while tempers were running high as petitioner Cruz, the Barangay
Chairperson, became incensed at the removal of the steel bar and
padlock that was earlier used to close access to the ring and at the
inability or refusal of respondents' group to return the said steel bar and
padlock to her as she had ordered.
The destructive acts of petitioners, however, find no legal sanction. This
Court has ruled time and again that no public official is above the law.31
The Court of Appeals correctly ruled that although petitioners claim to
have merely performed an abatement of a public nuisance, the same
was done summarily while failing to follow the proper procedure therefor
and for which, petitioners must be held administratively liable.
Prevailing jurisprudence holds that unless a nuisance is a nuisance per se,
it may not be summarily abated.32
There is a nuisance when there is "any act, omission, establishment,
business, condition of property, or anything else which: (1) injures or
endangers the health or safety of others; or (2) annoys or offends the
senses; or (3) shocks, defies or disregards decency or morality; or (4)
obstructs or interferes with the free passage of any public highway or
street, or any body of water; or (5) hinders or impairs the use of
property."33 But other than the statutory definition, jurisprudence
recognizes that the term "nuisance" is so comprehensive that it has been
applied to almost all ways which have interfered with the rights of the
citizens, either in person, property, the enjoyment of his property, or his
comfort.34
A nuisance is classified in two ways: (1) according to the object it affects;
or (2) according to its susceptibility to summary abatement.1âwphi1
As for a nuisance classified according to the object or objects that it
affects, a nuisance may either be: (a) a public nuisance, i.e., one which
"affects a community or neighborhood or any considerable number of
persons, although the extent of the annoyance, danger or damage upon
individuals may be unequal"; or (b) a private nuisance, or one "that is not
included in the foregoing definition" which, in jurisprudence, is one which
"violates only private rights and produces damages to but one or a few
persons."35
A nuisance may also be classified as to whether it is susceptible to a legal
summary abatement, in which case, it may either be: (a) a nuisance per
se, when it affects the immediate safety of persons and property, which
may be summarily abated under the undefined law of necessity;36 or, (b)
a nuisance per accidens, which "depends upon certain conditions and
circumstances, and its existence being a question of fact, it cannot be
abated without due hearing thereon in a tribunal authorized to decide
whether such a thing does in law constitute a nuisance;"37 it may only be
so proven in a hearing conducted for that purpose and may not be
summarily abated without judicial intervention.38
In the case at bar, none of the tribunals below made a factual finding
that the basketball ring was a nuisance per se that is susceptible to a
summary abatement. And based on what appears in the records, it can
be held, at most, as a mere nuisance per accidens, for it does not pose
an immediate effect upon the safety of persons and property, the
definition of a nuisance per se. Culling from examples cited in
jurisprudence, it is unlike a mad dog on the loose, which may be killed on
sight because of the immediate danger it poses to the safety and lives of
the people; nor is it like pornographic materials, contaminated meat and
narcotic drugs which are inherently pernicious and which may be
summarily destroyed; nor is it similar to a filthy restaurant which may be
summarily padlocked in the interest of the public health.39 A basketball
ring, by itself, poses no immediate harm or danger to anyone but is merely
an object of recreation. Neither is it, by its nature, injurious to rights of
property, of health or of comfort of the community and, thus, it may not
be abated as a nuisance without the benefit of a judicial hearing.40
But even if it is assumed, ex gratia argumenti, that the basketball ring was
a nuisance per se, but without posing any immediate harm or threat that
required instantaneous action, the destruction or abatement performed
by petitioners failed to observe the proper procedure for such an action
which puts the said act into legal question.
Under Article 700 of the Civil Code, the abatement, including one without
judicial proceedings, of a public nuisance is the responsibility of the district
health officer. Under Article 702 of the Code, the district health officer is
also the official who shall determine whether or not abatement, without
judicial proceedings, is the best remedy against a public nuisance. The
two articles do not mention that the chief executive of the local
government, like the Punong Barangay, is authorized as the official who
can determine the propriety of a summary abatement.
Further, both petitioner Cruz, as Punong Barangay, and petitioner Dela
Cruz, as Barangay Tanod, claim to have acted in their official capacities
in the exercise of their powers under the general welfare clause of the
Local Government Code. However, petitioners could cite no barangay
nor city ordinance that would have justified their summary abatement
through the exercise of police powers found in the said clause. No
barangay nor city ordinance was violated; neither was there one which
specifically declared the said basketball ring as a nuisance per se that
may be summarily abated. Though it has been held that a nuisance per
se may be abated via an ordinance, without judicial proceedings,41 We
add that, in the case at bar, petitioners were required to justify their
abatement via such an ordinance because the power they claim to have
exercised – the police power under the general welfare clause – is a
power exercised by the government mainly through its legislative, and not
the executive, branch. The prevailing jurisprudence is that local
government units such as the provinces, cities, municipalities and
barangays exercise police power through their respective legislative
bodies.42
The general welfare clause provides for the exercise of police power for
the attainment or maintenance of the general welfare of the community.
The power, however, is exercised by the government through its legislative
branch by the enactment of laws regulating those and other
constitutional and civil rights.43 Jurisprudence defines police power as the
plenary power vested in the legislature to make statutes and ordinances
to promote the health, morals, peace, education, good order or safety
and general welfare of the people.44 The Latin maxim is salus populi est
suprema lex (the welfare of the people is the supreme law).45 Police
power is vested primarily with the national legislature, which may
delegate the same to local governments through the enactment of
ordinances through their legislative bodies (the sanggunians).46 The so-
called general welfare clause, provided for in Section 16 of the Local
Government Code, provides for such delegation of police power, to wit:
Section 16. General Welfare. Every local government unit shall exercise
the powers expressly granted, those necessarily implied therefrom, as well
as powers necessary, appropriate, or incidental for its efficient and
effective governance, and those which are essential to the promotion of
the general welfare. Within their respective territorial jurisdictions, local
government units shall ensure and support, among other things, the
preservation and enrichment of culture, promote health and safety,
enhance the right of the people to a balanced ecology, encourage and
support the development of appropriate and self-reliant scientific and
technological capabilities, improve public morals, enhance economic
prosperity and social justice, promote full employment among their
residents, maintain peace and order, and preserve the comfort and
convenience of their inhabitants.
Flowing from this delegated police power of local governments, a local
government unit like Barangay 848, Zone 92 in which petitioners were
public officials, exercises police power through its legislative body, in this
case, its Sangguniang Barangay.47 Particularly, the ordinances passed by
the sanggunian partly relate to the general welfare of the barangay, as
also provided for by the Local Government Code as follows:
Section 391. Powers, Duties, and Functions. –
(a) The sangguniang barangay, as the legislative body of the barangay,
shall:
(1) Enact ordinances as may be necessary to discharge the responsibilities
conferred upon it by law or ordinance and to promote the general
welfare of the inhabitants therein; (emphasis supplied)
Even the powers granted to the punong barangay consist mainly of
executing only those laws and ordinances already enacted by the
legislative bodies, including the said official's own sangguniang
barangay, to wit:
Section 389. Chief Executive: Powers, Duties, and Functions. –
(a) The punong barangay, as the chief executive of the barangay
government, shall exercise such powers and perform such duties and
functions, as provided by this Code and other laws.
(b) For efficient, effective and economical governance, the purpose of
which is the general welfare of the barangay and its inhabitants pursuant
to Section 16 of this Code, the punong barangay shall:
(1) Enforce all laws and ordinances which are applicable within the
barangay;
xxxx
(3) Maintain public order in the barangay and, in pursuance thereof, assist
the city or municipal mayor and the sanggunian members in the
performance of their duties and functions;
xxxx
Art. 704. Any private person may abate a public nuisance which is
specially injurious to him by removing, or if necessary, by destroying the
thing which constitutes the same, without committing a breach of the
peace, or doing unnecessary injury. But it is necessary:

(14) Promote the general welfare of the barangay; (1) That demand be first made upon the owner or possessor of the
property to abate the nuisance;
(15) Exercise such other powers and perform such other duties and
functions as may be prescribed by law or ordinance.48 (2) That such demand has been rejected;

Clearly, the complete destruction of the basketball ring by the petitioners (3) That the abatement be approved by the district health officer and
is justified neither by law or ordinance nor even by equity or necessity, executed with the assistance of the local police; and
which makes the act illegal and petitioners liable. And even as an action
to maintain public order, it was done excessively and was unjustified. (4) That the value of the destruction does not exceed three thousand
Where a less damaging action, such as the mere padlocking, removal or pesos.
confiscation of the ring would have sufficed, petitioners resorted to the
drastic measure of completely destroying and rendering as unusable the WHEREFORE, premises considered, the petition is DENIED. The Court of
said ring, which was a private property, without due process. Such an act Appeals Decision dated March 31, 2008 in CA-G.R. SP. No. 104474 is
went beyond what the law required and, in being so, it tarnished the AFFIRMED.
image and integrity of the offices held by petitioners and diminished the
public's confidence in the legal system. Petitioners who were public SO ORDERED.
officials should not have been too earnest at what they believed was an
act of restoring peace and order in the community if in the process they
would end up disturbing it themselves. They cannot break the law that
they were duty-bound to enforce. Although the Court bestows sympathy
to the numerous constituents who allegedly complained against the
basketball court to petitioners, it cannot legally agree with the methods
employed by the said officials. Their good intentions do not justify the
destruction of private property without a legal warrant, because the
promotion of the general welfare is not antithetical to the preservation of
the rule of law.49 Unlike the examples cited earlier of a mad dog on the
loose, pornography on display or a filthy restaurant, which all pose
immediate danger to the public and, therefore, could be addressed by
anyone on sight, a basketball ring as a nuisance poses no such urgency
that could have prevented petitioners from exercising any form of
deliberation or circumspection before acting on the same.

Petitioners do not claim to have acted in their private capacities but in

their capacities as public officials, thus, they are held administratively
liable for their acts. And even in their capacities as private individuals who
may have abated a public nuisance, petitioners come up short of the
legal requirements. They do not claim to have complied with any of the
requisites laid down in Article 704 of the Civil Code, to wit: