Land Ti Sec 32 Cases

Land Titles and Deeds | 1
G.R. No. 173289 February 17, 2010
ELAND PHILIPPINES, INC., Petitioner,

vs.
AZUCENA GARCIA, ELINO FAJARDO, AND HEIR OF TIBURCIO MALABANAN NAMED TERESA
MALABANAN, Respondents.
DECISION
PERALTA, J.:
This is a Petition for Review on Certiorari under Rule 45 of the Rules of Court, seeking to reverse
and set aside the decision1 dated February 28, 2006 of the Court of Appeals (CA) in CA-G.R. CV No.
67417, which dismissed the appeal of petitioner Eland Philippines, Inc. and affirmed the Resolutions
dated November 3, 1999 and June 28, 2006 of Branch 18, Regional Trial Court (RTC) of Tagaytay
City.
The facts of the case, as shown in the records, are the following:
Respondents Azucena Garcia, Elino Fajardo, and Teresa Malabanan, the heir of Tiburcio Malabanan,
filed a Complaint2 dated March 2, 1998 for Quieting of Title with Writ of Preliminary Injunction
with the RTC, Branch XVIII, Tagaytay City against petitioner Eland Philippines, Inc. Respondents
claimed that they are the owners, in fee simple title, of a parcel of land identified as Lot 9250 Cad-
355, Tagaytay Cadastre, Plan Ap-04-008367, situated in Barangay Iruhin, Tagaytay City, containing
an area of Two Hundred Forty-Four Thousand One Hundred Twelve (244,112) square meters, by
occupation and possession under the provisions of Sec. 48 (b)3 of the Public Land Law or
Commonwealth Act No. 141, as amended.
For having been in continuous, public, and adverse possession as owners of the said lot for at least
thirty years, respondents stated that they were not aware of any person or entity who had a legal
or equitable interest or claim on the same lot until the time they were requesting that the lot be
declared for tax purposes. They found out that the lot was the subject of a land registration
proceeding that had already been decided by the same court4 where their complaint was filed.
They also found out that Decree No. N-217313, LRC Record No. N-62686, was already issued on
August 20, 1997 to the petitioner pursuant to the Decision dated June 7, 1994 of the same court.
They averred that they were not notified of the said land registration case; thus, they claimed the
presence of misrepresentation amounting to actual or extrinsic fraud. Thus, they argued that they
were also entitled to a writ of preliminary injunction in order to restrain or enjoin petitioner, its
privies, agents, representatives, and all other persons acting on its behalf, to refrain from
committing acts of dispossession on the subject lot.
Summons, together with a copy of the complaint, were served on the petitioner on April 7, 1998.
On April 29, 1998, petitioner filed an Entry of Appearance with Motion for Extension of Time,5
which the trial court granted6 for a period of ten (10) days within which to file a responsive
pleading. Petitioner filed a Second Motion for Extension of Time to File Answer7 dated April 29,
1998, which the trial court likewise granted.8
Thereafter, petitioner filed a Motion to Dismiss9 dated May 9, 1998, stating that the pleading
asserting the claim of respondents stated no cause of action, and that the latter were not entitled
to the issuance of a writ of preliminary injunction, setting the same for hearing on May 21, 1998.
On the date of the hearing, the trial court issued an Order,10 which granted the respondents ten
(10) days from that day to file a comment, and set the date of the hearing on July 23, 1998.
Respondents filed a Motion to Admit Comment/Opposition to Defendant Eland,11 together with
the corresponding Comment/Opposition12 dated June 8, 1998.
On the scheduled hearing of September 23, 1998, the trial court issued an Order,13 considering the
Motion to Dismiss submitted for resolution due to the non-appearance of the parties and their
respective counsels. The said motion was eventually denied by the trial court in an Order14 dated
September 25, 1998, ruling that the allegations in the complaint established a cause of action and
enjoined petitioner Eland to file its answer to the complaint within ten (10) days from receipt of the
same. Petitioner then filed two Motions for Extension to File an Answer.15
Petitioner, on November 9, 1998, filed a Motion for Reconsideration16 of the trial court's Order
dated September 25, 1998, denying the former's Motion to Dismiss. Again, petitioner filed a Motion
for Final Extension of Time to File Answer17 dated November 6, 1998. Respondents filed their
Comment/Opposition to Motion for Reconsideration dated November 24, 1998. Subsequently, the
trial court denied petitioner's motion for reconsideration in an Order18 dated January 11, 1999.
Meanwhile, respondents filed a Motion to Declare Defendant Eland in Default19 dated November
17, 1998. On December 4, 1998 Petitioner Eland filed its Comment (on Plaintiff's Motion to Declare
Defendant Eland in Default)20 dated December 2, 1998, while respondents filed a Reply to
Comment (on Plaintiff's Motion to Declare Defendant Eland in Default)21 dated December 29,
1998. Thereafter, the trial court issued an Order22 dated January 11, 1999 declaring the petitioner
in default and allowed the respondents to present evidence ex parte. Petitioner filed a Motion for
Reconsideration (of the Order dated 11 January 1999)23 dated February 5, 1999 on the trial court's
denial of its motion to dismiss and in declaring it in default. The trial court in an Order24 dated
March 18, 1999, denied the former and granted the latter. In the same Order, the trial court
admitted petitioner's Answer Ad Cautelam.
Earlier, petitioner filed its Answer Ad Cautelam (With Compulsory Counterclaim)25 dated
November 12, 1998. Respondents countered by filing a Motion to Expunge Eland's Answer from the
Records26 dated December 2, 1998. Petitioner filed its Opposition (to Plaintiff's Motion to Expunge
Eland's Answer from the Records)27 dated December 21, 1998, as well as a Comment (on Plaintiff's
Motion to Expunge Eland's Answer from the Records)28 dated January 26, 1999.
Consequently, respondents filed a Motion to Set Presentation of Evidence Ex Parte29 dated January
18, 1999, which was granted in an Order30 dated January 22, 1999.
On January 28, 1999, respondents presented their evidence before the Clerk of Court of the trial
court which ended on February 3, 1999; and, on February 10, 1999, respondents filed their Formal
Offer of Evidence.31 However, petitioner filed an Urgent Motion to Suspend Plaintiff's Ex Parte
Presentation of Evidence32 dated February 8, 1999. In that regard, the trial court issued an Order33
dated February 11, 1999 directing the Clerk of Court to suspend the proceedings.
On May 14, 1999, respondents filed a Motion for Clarification34 as to whether or not the evidence
presented ex parte was nullified by the admission of petitioner's Answer Ad Cautelam. Petitioner
filed its Comment35 dated May 13, 1999 on the said motion for clarification.
A pre-trial conference was scheduled on May 27, 1999, wherein the parties submitted their pre-trial
briefs.36 However, petitioner filed a Motion to Suspend Proceedings37 dated May 24, 1999 on the
ground that the same petitioner had filed a petition for certiorari with the CA, asking for the
nullification of the Order dated March 18, 1999 of the trial court and for the affirmation of its
earlier Order denying petitioner's Motion to Dismiss. The petition for certiorari was subsequently
denied; and a copy of the Resolution38 dated June 14, 1999 was received by the trial court. Hence,
in an Order39 dated July 7, 1999, the trial court ruled that the reception of evidence already
presented by the respondents before the Clerk of Court remained as part of the records of the case,
and that the petitioner had the right to cross-examine the witness and to comment on the
documentary exhibits already presented. Consequently, petitioner filed a Motion for
Reconsideration40 dated July 19, 1999, but it was denied by the trial court in an Omnibus Order41
dated September 14, 1999.
Eventually, respondents filed a Motion for Summary Judgment42 dated August 5, 1999, while
petitioner filed its Opposition43 to the Motion dated August 31, 1999. In its Resolution44 dated
November 3, 1999, the trial court found favor on the respondents. The dispositive portion of the
Resolution reads:
WHEREFORE, premises considered, the motion for summary judgment is hereby GRANTED and it is
hereby adjudged that:
1. Plaintiffs are the absolute owners and rightful possessors of Lot 9250, CAD-355, Tagaytay
Cadastre, subject to the rights of occupancy of the farm workers on the one-third area thereof;
2. The Judgment dated June 7, 1994 in Land Registration Case No. TG-423 is set aside and the
Decree No. N-217313, LRC Record No. N-62686 dated August 20, 1997 is null and void;
3. The Original Transfer Certificate of Title is ordered to be canceled, as well as tax declaration
covering Lot 9250, Cad-355.
SO ORDERED.
Petitioner appealed the Resolution of the trial court with the CA, which dismissed it in a Decision
dated February 28, 2006, which reads:
WHEREFORE, for lack of merit, the appeal is DISMISSED. The assailed Resolution dated November 3,
1999, of the RTC, Branch 18, Tagaytay City, in Civil Case No. TG-1784, is AFFIRMED. No
pronouncement as to cost.
SO ORDERED.
Hence, the present petition.

The grounds relied upon by the petitioner are the following:
5.1 THE COURT OF APPEALS ACTED IN A MANNER NOT IN ACCORD WITH LAW AND WITH THE
APPLICABLE DECISIONS OF THIS HONORABLE COURT WHEN IT RULED THAT RESPONDENTS'
MOTION FOR SUMMARY JUDGMENT DATED AUGUST 05, 1999 DID NOT VIOLATE THE TEN (10)-DAY
NOTICE RULE UNDER SECTION 3, RULE 35 OF THE 1997 RULES OF CIVIL PROCEDURE.
APPLICABLE DECISIONS OF THIS HONORABLE COURT WHEN IT RULED THAT A MOTION FOR
SUMMARY JUDGMENT IS PROPER IN AN ACTION FOR QUIETING OF TITLE.
APPLICABLE DECISIONS OF THIS HONORABLE COURT WHEN IT RULED THAT THERE ARE NO
GENUINE FACTUAL AND TRIABLE ISSUES IN CIVIL CASE NO. TG-1784.
APPLICABLE DECISIONS OF THIS HONORABLE COURT WHEN IT UPHELD THE RESOLUTION DATED
NOVEMBER 03, 1999 OF THE COURT A QUO, BASED ON TESTIMONIES OF RESPONDENTS'
WITNESSES TAKEN WITHOUT GRANTING HEREIN PETITIONER THE RIGHT TO CROSS-EXAMINE AND
UPON DOCUMENTARY EXHIBITS PRESENTED BUT NOT ADMITTED AS EVIDENCE.
APPLICABLE DECISIONS OF THIS HONORABLE COURT WHEN IT UPHELD THE RESOLUTION DATED
NOVEMBER 03, 1999 OF THE COURT A QUO BASED ON FALSIFIED "EVIDENCE."
APPLICABLE DECISIONS OF THIS HONORABLE COURT WHEN IT FAILED TO RULE THAT THE COURT A
QUO PATENTLY DEPRIVED PETITIONER OF ITS RIGHT TO DUE PROCESS IN RENDERING ITS
SUMMARY JUDGMENT.
APPLICABLE DECISIONS OF THIS HONORABLE COURT WHEN IT HELD THAT THE COURT A QUO HAS
JURISDICTION TO CANCEL PETITIONER'S ORIGINAL CERTIFICATE OF TITLE (OCT) NO. 0-660 IN AN
ACTION TO QUIET TITLE.
According to the petitioner, a motion for summary judgment must be served at least ten (10) days
before the date set for hearing thereof, and that a hearing must be held to hear the parties on the
propriety of a summary judgment, per Sec. 3 of Rule 35 of the Revised Rules of Court, which was
not observed because the petitioner received a copy of the respondents' motion for summary
judgment only on August 20, 1999, or the very same day that the motion was set for hearing.
Petitioner further claims that the trial court never conducted any hearing on the motion for
summary judgment.
Petitioner also argued that a summary judgment is only available to a claimant seeking to recover
upon a claim, counterclaim or cross-claim or to obtain a declaratory relief, and does not include
cases for quieting of title. Furthermore, petitioner also averred that a summary judgment has no
place in a case where genuine factual and triable issues exist, like in the present case. It added that
the genuine and triable issues were all raised in its Answer Ad Cautelam.
Another ground relied upon by petitioner is its failure to cross-examine the witnesses for the
respondents without fault on its part. It also stated that the trial court did not issue any order
admitting in evidence the documentary exhibits presented by the respondents. Hence, according to
the petitioner, the trial court gravely erred in relying upon the testimonies of the witnesses for the
respondents, without having the latter cross-examined; and upon the documentary exhibits
presented but not admitted as evidence.
Petitioner further claimed that the trial court based its Resolution dated November 3, 1999 on
falsified evidence.
Lastly, petitioner raised the issue that by rendering summary judgment, the trial court deprived the
former of its right to due process.
Respondents, in their Comment45 dated October 16, 2006, countered the first issue raised by the
petitioner, stating that their filing of the motion for summary judgment fourteen (14) days before
the requested hearing of the same motion was in compliance with Sec. 3, Rule 35 of the Rules of
Court.
As to the second and third issues, respondents argued that petitioner had a constricted perception
of the coverage of the Rules of Summary Judgment, and that the latter's citation of cases decided
by this Court showed the diverse causes of action that could be the subject matters of summary
judgment. Respondents also posited that petitioner's statements in its Answer Ad Cautelam,
although denominated as Specific Denial, were really general denials that did not comply with the
provisions of Section 10, Rule 8 of the Rules of Court.
Anent the fourth and fifth issues, respondents claimed that despite the opportunity, or the right
allowed in the Order dated July 17, 1999 of the trial court, for the petitioner to cross-examine
respondents' witnesses and to comment on the documentary evidence presented ex parte after the
default order against the same petitioner, the latter evasively moved to set aside respondents'
evidence in order to suspend further proceedings that were intended to abort the pre-trial
conference. They added that petitioner neglected to avail itself of, or to comply with, the
prescription of the rules found in Rule 35 of the Rules of Court by opting not to avail itself of the
hearing of its opposition to the summary judgment after receiving the Order dated August 20,
1999; by failing to serve opposing affidavit, deposition or admission in the records; and by not
objecting to the decretal portion of the said Order dated August 20, 1999, which stated that the
motion for summary judgment has been submitted for resolution without further argument. With
regard to the contention of the petitioner that the trial court wrongly appreciated falsified
evidence, respondents asserted that petitioner's counsel failed to study carefully the records of the
proceedings for the presentation of the evidence ex parte to be able to know that it was not only a
single-day proceeding, and that more than one witness had been presented. They further averred
that the trial court did not only rely on the photographs of the houses of the occupants of the
property in question.
Finally, as to the sixth and seventh issues, respondents asseverated that their complaint alleged
joint causes of action for quieting of title under Art. 476 of the New Civil Code and for the review of
the decree of registration pursuant to Sec. 32 of the Property Registration Decree or P.D. No. 1529,
because they are complimentary with each other.
The petition is impressed with merit.
The basic contention that must be resolved by this Court is the propriety of the summary judgment
in this particular case of quieting of title.
Rule 35 of the 1997 Rules of Civil Procedure provides:
SEC. 1. Summary judgment for claimant. - A party seeking to recover upon a claim, counterclaim, or
cross-claim or to obtain a declaratory relief may, at any time after the pleading in answer thereto
has been served, move with supporting affidavits for a summary judgment in his favor upon all or
any part thereof
SEC. 3. Motion and proceedings thereon. - The motion shall be served at least ten (10) days before
the time specified for the hearing. The adverse party prior to the day of hearing may serve opposing
affidavits. After the hearing, the judgment sought shall be rendered forthwith if the pleading,
depositions, and admissions on file together with the affidavits, show that, except as to the amount
of damages, there is no genuine issue as to any material fact and that the moving party is entitled
to a judgment as a matter of law.46
In the present case, it was the respondents who moved for a summary judgment.
Petitioner contended that the ten-day notice rule was violated, because the copy of the motion for
summary judgment was served only on August 20, 1999 or on the same day it was set for hearing. It
also added that even if the petitioner received a copy of the motion only on August 20, 1999, there
was no hearing conducted on that date because the trial court issued an order giving petitioner 10
days within which to file its comment or opposition.
The above specific contention, however, is misguided. The CA was correct in its observation that
there was substantial compliance with due process. The CA ruled, as the records show, that the ten-
day notice rule was substantially complied with because when the respondents filed the motion for
summary judgment on August 9, 1999, they furnished petitioner with a copy thereof on the same
day as shown in the registry receipt and that the motion was set for hearing on August 20, 1999, or
10 days from the date of the filing thereof.
Due process, a constitutional precept, does not, therefore, always and in all situations a trial-type
proceeding. The essence of due process is found in the reasonable opportunity to be heard and
submit one's evidence in support of his defense. What the law prohibits is not merely the absence
of previous notice, but the absence thereof and the lack of opportunity to be heard.47
Petitioner further argues that summary judgment is not proper in an action for quieting of title. This
particular argument, however, is misplaced. This Court has already ruled that any action can be the
subject of a summary judgment with the sole exception of actions for annulment of marriage or
declaration of its nullity or for legal separation.48
Proceeding to the main issue, this Court finds that the grant of summary judgment was not proper.
A summary judgment is permitted only if there is no genuine issue as to any material fact and a
moving party is entitled to a judgment as a matter of law. A summary judgment is proper if, while
the pleadings on their face appear to raise issues, the affidavits, depositions, and admissions
presented by the moving party show that such issues are not genuine.49
It must be remembered that the non-existence of a genuine issue is the determining factor in
granting a motion for summary judgment, and the movant has the burden of proving such
nonexistence. The trial court found no genuine issue as to any material fact that would necessitate
conducting a full-blown trial. However, a careful study of the case shows otherwise.
In their motion for summary judgment, the respondents failed to clearly demonstrate the absence
of any genuine issue of fact. They merely reiterated their averments in the complaint for quieting of
title and opposed some issues raised by the petitioner in its Answer Ad Cautelam, to wit:
Nonetheless, going by the records of the admitted and uncontroverted facts and facts established
there is no more litigious or genuine issue of basic fact to be the subject of further trial on the
merits.
The first defense as to the identity of the subject property, the issue has already become nil
because of not only the lack of seriousness in the allegations but also because the identity of the
subject parcel of land Lot 9250 was proven by the approved plan Ap-04-008367 that was already
presented and offered in evidence as Exhibit "B" for the plaintiffs.
The second defense that plaintiffs' claim of the property is barred by prior judgment rule is
unavailing considering that the vital documentary evidence they presented in Land Registration
Case No. TG-423 before this Honorable Court the markings and descriptions of such documents are
stated in the Judgment quoted as follows:
(1) Tax Declaration No. 015224-A (Exhibit "Q"; x x x.
(2) Tax Declaration No. 05019-B (Exhibit "R"; x x x.
(3) Tax Declaration No. 01926-B (Exhibit "S"; x x x.
(4) Tax Declaration No. GR-007-0007 (Exhibit "T" x x x.
are the very documentary evidence adopted and relied upon by the plaintiffs in seeking the review
and nullity of the Decree No. 217313 issued on August 20, 1997 under LRC Record No. N-62686
pursuant to the Judgment dated June 7, 1994 rendered by this Honorable Court penned by the
acting presiding Judge Eleuterio F. Guerrero in said Land Registration Case No. TG-423.
On the other hand, as to the gravamen of the claims in the complaint, the plaintiffs have presented
clear and convincing evidence as the well-nigh or almost incontrovertible evidence of a registerable
title to the subject land in the proceedings conducted on the reception of evidence ex-parte for the
plaintiffs establishing in detail the specifications of continuous, open, exclusive possession as
aspects of acquisitive prescription as confirmed in the affidavit herein attached as Annex "A";
In ruling that there was indeed no genuine issue involved, the trial court merely stated that:
This Court, going by the records, observed keenly that plaintiffs’ cause of action for quieting of title
on the disputed parcel of land is based on the alleged fraud in the substitution of their landholdings
of Lot 9250, Cad 355, Tagaytay Cadastre containing only an area of 244,112 square meters with Lot
9121, Cad 335, Tagaytay Cadastre, containing only an area of 19,356 square meters. While
defendant Eland in its answer practically and mainly interposed the defenses of: (a) the parcel of
land being claimed by the plaintiffs is not the parcel of land subject matter of Land Registration
Case No. TG-423; (b) the claim of the plaintiffs is barred by prior judgment of this Court in said Land
Registration Case; and (c) plaintiffs' complaint is barred by the Statute of Limitation since Original
Certificate of Title No. 0-660 has become incontrovertible.
Cross-reference of the above-cited Land Registration Case No. TG-423 that was decided previously
by this Court with the case at bench was imperatively made by this Court. Being minded that the
Court has and can take judicial notice of the said land registration case, this Court observed that
there is no genuine issue of fact to be tried on the merits. Firstly, because the supposed identity
crisis of the controverted parcel of land covered by the Land Registration Case No. TG-423 with the
subject parcel of land is established by Plan Ap-04-006275 (Exhibit "N") LRC Case No. 423 and by
Plan A04 008367 (Exhibit "B" of the plaintiffs) and the Technical Description of Lot 9250, Cad 355
(Exhibit "B-1" of the plaintiffs). Secondly, the prior judgment rule cannot be availed of by defendant
Eland since not only intrinsic fraud but extrinsic fraud were alleged in and established by the
records. (Heirs of Manuel Roxas v. Court of Appeals, G. R. No. 1184436, pro. March 21, 1997).
Thirdly, it is incontrovertible that the complaint in this case seeking to review the judgment and
annul the decree was filed on March 5, 1998 or within one (1) year from August 20, 1997 or the
date of issuance of Decree No. 217313, LRC Record No. N-62686, hence, the Original Certificate of
Title No. 0-660 issued to defendant Eland has not attained incontrovertibility. (Heirs of Manuel
Roxas v. Court of Appeals, G.R. No. 118436, prom. March 21, 1997).
Notwithstanding, the issue of possession is a question of fact by the interaction of the basic
pleadings, the observation of this Court is that the plaintiffs were able to prove by the well-nigh
incontrovertible evidence, the aspects of possession in accordance with Section 48 (b) of
Commonwealth Act 141, as amended, as hereinafter illustrated.
The CA, in affirming the above Resolution of the trial court, propounded thus:
The contention of defendant-appellant is untenable. Summary judgment is not only limited to

solving actions involving money claims. Under Rule 35 of the 1997 Rules of Court, except as to the
amount of damages, when there is no genuine issue as to any material fact and the moving party is
entitled to a judgment as a matter of law, summary judgment may be allowed. The term "genuine
issue" has been defined as an issue of fact which calls for the presentation of evidence as
distinguished from an issue which is sham, fictitious, contrived, set up in bad faith and patently
unsubstantial so as not to constitute a genuine issue for trial.
Thus, under the aforecited rule, summary judgment is appropriate when there are no genuine
issues of fact, which call for the presentation of evidence in a full-blown trial. Thus, even if on their
face the pleadings appear to raise issues, but when the affidavits, depositions and admissions show
that such issues are not genuine, then summary judgment as prescribed by the rules must ensue as
a matter of law.
It should be stressed that the court a quo which rendered the assailed resolution in Civil Case No.
TG-1784 was the very court that decided the LRC Case No. TG-423. Such being the case, the court a
quo was privy to all relevant facts and rulings pertaining to LRC Case No. TG-423 which it
considered and applied to this case. Thus, where all the facts are within the judicial knowledge of
the court, summary judgment may be granted as a matter of right.
On the contrary, in petitioner's Answer Ad Cautelam, genuine, factual and triable issues were
raised, aside from specifically denying all the allegations in the complaint, thus:
2. SPECIFIC DENIALS
2.1 Answering defendant specifically denies the allegations contained in paragraphs 1 and 3 of the
Complaint insofar as it alleges the personal circumstances of the plaintiff and one A. F.
Development Corporation for lack of knowledge or information sufficient to form a belief as to the
truth thereof.
2.2 Answering defendant specifically denies the allegations contained in paragraphs 4, 5, 6 and 7 of
the Complaint for lack of knowledge or information sufficient to form a belief as to the truth of said
allegations. And if the property referred to in said paragraphs is that parcel of land which was the
subject matter of Land Registration Case No. TG-423 which was previously decided by this
Honorable Court with finality, said allegations are likewise specifically denied for the obvious reason
that the said property had already been adjudged with finality by no less than this Honorable Court
as absolutely owned by herein answering defendant as will be further discussed hereunder.
2.3 Answering defendant specifically denies the allegations contained in paragraph 8 of the
Complaint insofar as it alleged that "(u)pon exercise of further circumspection, counsel for the
plaintiffs once followed-up in writing the 1994 request of the plaintiffs to have the subject parcel of
land be declared for taxation purposes" and insofar as it is made to appear that parcel of land being
claimed by the plaintiffs is the same parcel of land subject matter of Land Registration Case No. TG-
423 for lack of knowledge or information sufficient to form a belief as to the truth thereof and for
the reason that the names of the herein plaintiffs were never mentioned during the entire
proceedings in said land registration case and by reason of the Affirmative Allegations contained
hereunder.
2.4 Answering defendant specifically denies the allegations contained in paragraphs 9, 10, 10 (a), 10
(b), 10 (c), 10 (d), 10 (e), 10 (f), 10 (g), 10 (h), and 11 for the reason that there is no showing that the
parcel of land being claimed by the plaintiff is the same parcel of land which was the subject matter
of Land Registration Case No. TG- 423, and in the remote possibility that the parcel of land being
claimed by the plaintiffs is the same as that parcel of land subject of Land Registration Case No. TG-
423, the allegations contained in said paragraphs are still specifically denied for the reason that no
less than the Honorable Court had decided with finality that the parcel of land is absolutely owned
by herein defendant to the exclusion of all other persons as attested to by the subsequent issuance
of an Original Certificate of Title in favor of answering defendant and for reasons stated in the
Affirmative Allegations.
Complaint for the obvious reason that it was the plaintiffs who appear to have been sleeping on
their rights considering that up to the present they still do not have any certificate of title covering
the parcel of land they are claiming in the instant case, while on the part of herein defendant, no
less than the Honorable Court had adjudged with finality that the parcel of land subject matter of
Land Registration Case No. TG-423 is absolutely owned by herein defendant.
complaint for the reason that defendant has never ladgrabbed any parcel of land belonging to
others, much less from the plaintiffs, and further, answering defendant specifically denies the
allegations therein that plaintiffs engaged the services of a lawyer for a fee for lack of knowledge r
information sufficient to form a belief as to the truth thereof.
2.7 Answering defendant specifically denies the allegations contained in paragraphs 14, 15, 16, 17
and 18 of the Complaint for lack of knowledge or information sufficient to form a belief as the truth
thereof.
2.8 Answering defendant specifically denies the allegations contained in paragraphs IV (a) to IV (c)
for the reason that, as above-stated, if the parcel of land being claimed by the plaintiffs is the same
as that parcel of land subject matter of Land Registration Case No. TG-423, this Honorable Court
had already decided with finality that said parcel of land is absolutely owned by herein answering
defendant and additionally, for those reasons stated in defendant's Motion to Dismiss.
2.9 Answering defendant specifically denies the allegations contained in paragraph IV (d) of the
Complaint for lack of knowledge or information sufficient to form a belief as to the truth thereof.
Special and affirmative defenses were also raised in the same Answer Ad Cautelam, to wit:
xxxx
4.1 The pleading asserting the claim of the plaintiff states no cause of action as asserted in the
Motion To Dismiss filed by herein answering defendant and for the reason that there is no evidence
whatsoever showing or attesting to the fact that the parcel of land being claimed by the plaintiffs in
the Complaint is the same parcel of land which was the subject matter of Land Registration Case
No. TG-423.
4.2 The complaint was barred by the prior judgment rendered by this Honorable in Land
Registration Case No. TG-423.
4.3 The complaint is barred by the Statute of Limitation in that OCT No. 0-660 had become
incontrovertible by virtue of the Torrens System of Registration; and to allow plaintiffs to question
the validity of answering defendant's title through the instant complaint would be a collateral of
OCT No. 0-660 which is not permissible under the law.
4.4 Plaintiffs are barred by their own acts and/or omission from filing the present complaint under
the principles of estoppel and laches.
4.5 Plaintiffs does not to the Court with clean hands as they appear to be well aware of the
proceedings in said Land Registration Case No. TG- 423 and inspite of such knowledge, plaintiffs
never bothered to present their alleged claims in the proceedings.
4.6 Answering defendant has always acted with justice, given everyone his due, and observed
honesty and good faith in his dealings.
Clearly, the facts pleaded by the respondents in their motion for summary judgment have been
duly disputed and contested by petitioner, raising genuine issues that must be resolved only after a
full-blown trial. When the facts as pleaded by the parties are disputed or contested, proceedings for
summary judgment cannot take the place of trial.50 In the present case, the petitioner was able to
point out the genuine issues. A "genuine issue" is an issue of fact that requires the presentation of
evidence as distinguished from a sham, fictitious, contrived or false claim.51
It is of utmost importance to remember that petitioner is already the registered owner (Original
Certificate of Title [OCT] No. 0-660 issued by the Register of Deeds) of the parcel of land in
question, pursuant to a decree of registration (Decree No. N-217313, LRC Record No. 62686) based
on the ruling of the same court that granted the summary judgment for the quieting of title.
Incidentally, the findings of the trial court contained in the disputed summary judgment were
obtained through judicial notice of the facts and rulings pertaining to that earlier case (LRC Case No.
TG-423) wherein the same trial court ruled in favor of the petitioner. It is, therefore, disorienting
that the same trial court reversed its earlier ruling, which categorically stated that:
x x x There is overwhelming evidence or proof on record that the vendors listed in Exhibit "HH,"
with submarkings, are the previous owners of the parcel of land mentioned in the same deed of
sale and aside form the tax declarations covering the same property (Exhibits "Q" to "T," inclusive),
the uncontroverted testimony of Atty. Ruben Roxas establishes beyond any shadow of doubt that
applicant's (referring to herein defendant-appellant) sellers/predecessors-in-interest are the
grandchildren, great grandchildren and great great grandchildren of the spouses Lucio Petate and
Maria Pobleta Petate, the former owners of the same property, whose ownership is further
bolstered by tax receipts showing payments of realty taxes (Exhibits "U" to "GG," inclusive, with
submarkings).
xxx
On the basis of the foregoing facts and circumstances, and considering that applicant is a domestic
corporation not otherwise disqualified from owning real properties in the Philippines, this Court
finds that applicant has satisfied all the conditions/requirements essential to the grant of its
application pursuant to the provisions of the Land Registration Law, as amended, inspite of the
opposition filed by the Heirs of the late Doroteo Miranda. Hence, the grant of applicant's petition
appears to be inevitable.
WHEREFORE, this Court hereby approves the instant petition for land registration and, thus, places
under the operation of Act 141, Act 496 and/or P.D. 1529, otherwise known as the Property
Registration Law, the land described in Plan Ap-04-006275 and containing an area of Two Hundred
Forty-Two Thousand Seven Hundred Ninety-Four (242,794) 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 the applicant, ELAND PHILIPPINES, INC., with principal office at No. 43 E.
Rodriguez Ave. (España Extension), Quezon City, Metro Manila.
Once this decision becomes final and executory, the corresponding decree of registration shall
forthwith issue.
SO ORDERED.
By granting the summary judgment, the trial court has in effect annulled its former ruling based on
a claim of possession and ownership of the same land for more than thirty years without the
benefit of a full-blown trial. The fact that the respondents seek to nullify the original certificate of
title issued to the petitioner on the claim that the former were in possession of the same land for a
number of years, is already a clear indicium that a genuine issue of a material fact exists. This,
together with the failure of the respondents to show that there were no genuine issues involved,
should have been enough for the trial court to give the motion for summary judgment, filed by
respondents, scant consideration. Trial courts have limited authority to render summary judgments
and may do so only when there is clearly no genuine issue as to any material fact.52
Based on the foregoing, this Court deems it necessary to delve briefly on the nature of the action of
quieting of title as applied in this case. This Court's ruling in Calacala, et al. v. Republic, et al.53 is
instructive on this matter, thus:
To begin with, it bears emphasis that an action for quieting of title is essentially a common law
remedy grounded on equity. As we held in Baricuatro, Jr. vs. CA:54
Regarding the nature of the action filed before the trial court, quieting of title is a common law
remedy for the removal of any cloud upon or doubt or uncertainty with respect to title to real
property. Originating in equity jurisprudence, its purpose is to secure ‘x x x an adjudication that a
claim of title to or an interest in property, adverse to that of the complainant, is invalid, so that the
complainant and those claiming under him may be forever afterward free from any danger of
hostile claim.’ In an action for quieting of title, the competent court is tasked to determine the
respective rights of the complainant and other claimants, ‘x x x not only to place things in their
proper place, to make the one who has no rights to said immovable respect and not disturb the
other, but also for the benefit of both, so that he who has the right would see every cloud of doubt
over the property dissipated, and he could afterwards without fear introduce the improvements he
may desire, to use, and even to abuse the property as he deems best xxx.
Under Article 476 of the New Civil Code, the remedy may be availed of only when, by reason of any
instrument, record, claim, encumbrance or proceeding, which appears valid but is, in fact, invalid,
ineffective, voidable, or unenforceable, a cloud is thereby cast on the complainant’s title to real
property or any interest therein. The codal provision reads:
Article 476. Whenever there is a cloud on title to real property or any interest therein, by reason of
any instrument, record, claim, encumbrance or proceeding which is apparently valid or effective
but is in truth and in fact invalid, ineffective, voidable, or unenforceable, and may be prejudicial to
said title, an action may be brought to remove such cloud or to quiet the title.
An action may also be brought to prevent a cloud from being cast upon title to real property or any
interest therein.
In turn, Article 477 of the same Code identifies the party who may bring an action to quiet title,
thus:
Article 477. The plaintiff must have legal or equitable title to, or interest in the real property which
is the subject-matter of the action. He need not be in possession of said property.
It can thus be seen that for an action for quieting of title to prosper, the plaintiff must first have a
legal, or, at least, an equitable title on the real property subject of the action and that the alleged
cloud on his title must be shown to be in fact invalid. So it is that in Robles, et al. vs. CA,55 we ruled:
It is essential for the plaintiff or complainant to have a legal title or an equitable title to or interest
in the real property which is the subject matter of the action. Also, the deed, claim, encumbrance or
proceeding that is being alleged as a cloud on plaintiff’s title must be shown to be in fact invalid or
inoperative despite its prima facie appearance of validity or legal efficacy.
Verily, for an action to quiet title to prosper, two (2) indispensable requisites must concur, namely:
(1) the plaintiff or complainant has a legal or an equitable title to or interest in the real property
subject of the action; and (2) the deed, claim, encumbrance, or proceeding claimed to be casting
cloud on his title must be shown to be in fact invalid or inoperative despite its prima facie
appearance of validity or legal efficacy.
Respondents, in their Complaint, claim that they have become the owners in fee-simple title of the
subject land by occupation and possession under the provisions of Sec. 48 (b) of the Public Land
Law or Commonwealth Act No. 141, as amended. Thus, it appears that the first requisite has been
satisfied. Anent the second requisite, respondents enumerated several facts that would tend to
prove the invalidity of the claim of the petitioner. All of these claims, which would correspond to
the two requisites for the quieting of title, are factual; and, as discussed earlier, the petitioner
interposed its objections and duly disputed the said claims, thus, presenting genuine issues that can
only be resolved through a full-blown trial.
Anent the propriety of the filing of an action for the quieting of title, the indefeasibility and
incontrovertibility of the decree of registration come into question. Under Sec. 32 of P.D. No. 1529
or the Property Registration Decree:
Section 32. Review of decree of registration; Innocent purchaser for value. The decree of
registration shall not be reopened or revised by reason of absence, minority, or other disability of
any person adversely affected thereby, nor by any proceeding in any court for reversing judgments,
subject, however, to the right of any person, including the government and the branches thereof,
deprived of land or of any estate or interest therein by such adjudication or confirmation of title
obtained by actual fraud, to file in the proper Court of First Instance a petition for reopening and
review of the decree of registration not later than one year from and after the date of the entry of
such decree of registration, but in no case shall such petition be entertained by the court where an
innocent purchaser for value has acquired the land or an interest therein, whose rights may be
prejudiced. Whenever the phrase "innocent purchaser for value" or an equivalent phrase occurs in
this Decree, it shall be deemed to include an innocent lessee, mortgagee, or other encumbrancer
for value.
Upon the expiration of said period of one year, the decree of registration and the certificate of title
issued shall become incontrovertible. Any person aggrieved by such decree of registration in any
case may pursue his remedy by action for damages against the applicant or any other persons
responsible for the fraud.
As borne out by the records and undisputed by the parties, OCT No. 0-660 of petitioner was issued
on August 29, 1997 pursuant to a Decree issued on August 20, 1997, while the complaint for the
quieting of title in Civil Case No. TG-1784 was filed and docketed on March 5, 1998; hence, applying
the above provisions, it would seem that the period of one (1) year from the issuance of the decree
of registration has not elapsed for the review thereof. However, a closer examination of the above
provisions would clearly indicate that the action filed, which was for quieting of title, was not the
proper remedy.
Courts may reopen proceedings already closed by final decision or decree when an application for
review is filed by the party aggrieved within one year from the issuance of the decree of
registration.56 However, the basis of the aggrieved party must be anchored solely on actual fraud.
Shedding light on the matter is a discussion presented in one of the recognized textbooks on
property registration,57 citing decisions of this Court, thus:
The right of a person deprived of land or of any estate or interest therein by adjudication or
confirmation of title obtained by actual fraud is recognized by law as a valid and legal basis for
reopening and revising a decree of registration.58 One of the remedies available to him is a petition
for review. To avail of a petition for review, the following requisites must be satisfied:
(a) The petitioner must have an estate or interest in the land;
(b) He must show actual fraud in the procurement of the decree of registration;
(c) The petition must be filed within one year from the issuance of the decree by the Land
Registration Authority; and
(d) The property has not yet passed to an innocent purchaser for value.59
A mere claim of ownership is not sufficient to avoid a certificate of title obtained under the Torrens
system. An important feature of a certificate of title is its finality. The proceedings whereby such a
title is obtained are directed against all persons, known or unknown, whether actually served with
notice or not, and includes all who have an interest in the land. If they do not appear and oppose
the registration of their own estate or interest in the property in the name of another, judgment is
rendered against them by default, and, in the absence of fraud, such judgment is conclusive. If an
interest in the land will not by itself operate to vacate a decree of registration, a fortiori, fraud is
not alone sufficient to do so.60
As further pointed out in the same book,61 the petition for review must be filed within one year
from entry of the decree of registration. As written:
As long as a final decree has not been entered by the Land Registration Authority and period of one
year has not elapsed from the date of entry of such decree, the title is not finally adjudicated and
the decision in the registration case continues to be under the control and sound discretion of the
registration court.62 After the lapse of said period, the decree becomes incontrovertible and no
longer subject to reopening or review.
Section 32 provides that a petition for review of the decree of registration may be filed "not later
than one year from and after the date of entry of such decree of registration." Giving this provision
a literal interpretation, it may at first blush seem that the petition for review cannot be presented
until the final decree has been entered. However, it has been ruled that the petition may be filed at
any time after the rendition of the court's decision and before the expiration of one year from the
entry of the final decree of registration for, as noted in Rivera v. Moran,63 there can be no possible
reason requiring the complaining party to wait until the final decree is entered before urging his
claim for fraud.
The one-year period stated in Sec. 32 within which a petition to re-open and review the decree of
registration refers to the decree of registration described in Section 31, which decree is prepared
and issued by the Land Registration Administrator.64
The provision of Section 31 that every decree of registration shall bind the land, quiet title thereto,
and be conclusive upon and against all persons, including the national government, and Sec. 32 that
the decree shall not be reopened or revised by reason of absence, minority or other disability or by
any proceeding in court, save only in cases of actual fraud and then only for one year from the
entry of the decree, must be understood as referring to final and unappealable decrees of
registration. A decision or, as it is sometimes called after entry, a decree of a registration court,
does not become final and unappealable until fifteen days after the interested parties have been
notified of its entry, and during that period may be set aside by the trial judge on motion for new
trial, upon any of the grounds stated in the Rules of Court.65 An appeal from the decision of the
trial court prevents the judgment from becoming final until that decree is affirmed by the judgment
of the appellate court.66
A petition for review under Section 32 is a remedy separate and distinct from a motion for new trial
and the right to the remedy is not affected by the denial of such a motion irrespective of the
grounds upon which it may have been presented. Thus, where petitioners acquired their interest in
the land before any final decree had been entered, the litigation was therefore in effect still
pending and, in these circumstances, they can hardly be considered innocent purchasers in good
faith.671avvphi1
Where the petition for review of a decree of registration is filed within the one-year period from
entry of the decree, it is error for the court to deny the petition without hearing the evidence in
support of the allegation of actual and extrinsic fraud upon which the petition is predicated. The
petitioner should be afforded an opportunity to prove such allegation.68
In the present case, the one-year period before the Torrens title becomes indefeasible and
incontrovertible has not yet expired; thus, a review of the decree of registration would have been
the appropriate remedy.
Based on the above disquisitions, the other issues raised by the petitioner are necessarily rendered
inconsequential.
WHEREFORE, the petition for review on certiorari of petitioner Eland Philippines, Inc. is hereby
GRANTED, and the decision dated February 28, 2006 of the Court of Appeals (CA) in CA-G.R. CV No.
67417, which dismissed the appeal of petitioner Eland Philippines, Inc. and affirmed the resolutions
dated November 3, 1999 and June 28, 2006 of Branch 18, RTC of Tagaytay City, is hereby REVERSED
and SET ASIDE. Consequently, the resolutions dated November 3, 1999 and June 28, 2006 of Branch
18, RTC of Tagaytay City in Civil Case No. TG-1784 are hereby declared NULL and VOID.
SO ORDERED.
G.R. No. L-22822 August 30, 1968
GREGORIA PALANCA, petitioner-appellant,

vs.
THE AMERICAN FOOD MANUFACTURING COMPANY and TIBURCIO EVALLE, in his capacity as
Director of Patents, respondents-appellees.
Lopez De Joya, Dimaguila and Hermoso for petitioner-appellant.

Domingo F. de Guzman for respondent-appellee American Food Manufacturing Company.
Office of the Solicitor General for respondent-appellee Director of Patents.
ZALDIVAR, J.:
On May 14, 1958, petitioner-appellant Gregoria Palanca filed with the Philippine Patent Office,
Department of Commerce and Industry, an application to register the trademark, "LION and the
representation of a lion's head," alleging that she had been using the trademark since January 5,
1958 on bechin (food seasoning). The application was opposed by herein respondent-appelee. The
American Food Manufacturing Company, on the ground that petitioner's trademark was similar to
its (respondent's) trademark "LION and representation of a lion" previously adopted and used by it
on the same type of product since August 3, 1953.
After hearing, the Director of Patents, on June 14, 1961, rendered a decision, the pertinent portion
of which reads as follows:
The record of the case consisting of respondent-appellant's1 application, the testimonies on behalf
of the parties with accompanying exhibits and the opposer's2 memorandum have been given
careful consideration. There is no memorandum for respondent-applicant. "There can be no
question but that the trademarks and the goods of the parties are similar. Accordingly the only
issue presented is that of priority of use.
Opposer's record establishes that it has at least since 1957, prior to January 5, 1968, the earliest
date of use asserted by respondent-applicant, continuously used LION and representation thereof,
as a trademark for bechin (food seasoning). The opposer is therefore the prior user while the
respondent-applicant is the later user of substantially the same trademark.
IN VIEW OF THE ABOVE CONSIDERATIONS, the opposition is hereby sustained and application Serial
No. 6321 of Gregoria Palanca is rejected.
The record shows the petitioner's counsel was furnished with copy of the decision on June 16,
1961.3 No appeal was taken from the decision of the Director of Patents within the reglementary
period from June 16, 1961.
On December 14, 1961, however, herein petitioner-appellant filed with the Patent Office a petition
to set aside the aforementioned judgment of June 14, 1961, invoking section 2 of Rule 38 of the
Rules of Court, alleging fraud and/or negligence committed by her former counsel, Atty. Bienvenido
Medel, in that the latter failed to file a memorandum before the case was submitted for decision;
that she had been fraudulently kept in total ignorance of the proceedings in the case; that her
counsel had not informed her of the decision thus preventing her from resorting to all the legal
remedies available to her; that she came to known of the decision only about the latter part of
October, 1961, through her friend, Mr. Domingo Adevoso; that she had evidence to disprove the
claim of opposer The American Food Manufacturing Company that it had been using the same
trademark even before 1958; and that she had evidence to show that the bechin that the opposer
sold prior to 1958 were not of the "Lion" brand but of the "Lion-Tiger" brand, another trademark of
opposer.
In its answer to the petition to set aside the judgment, the opposer, herein respondent-appellee be
American Food Manufacturing Company, denied the allegations of the petition and put up special
and affirmative defenses, to wit: that the petition was filed out of time; that the evidence proposed
to be presented was not new but was already existing and available at the time of the hearing of
the case; and that the decision was not rendered through fraud, accident, mistake, or excusable
negligence, as is contemplated in Section 2 of Rule 38 of the Rules of Court.
The petition to set aside the judgment was set for hearing, wherein petitioner-appellant and a
witness, Ricardo Monfero, testified. Witness Monfero testified that he was the owner of a grocery
store in San Pablo City, that the receipts issued to him by the American Food Manufacturing
Company on October 16, 1957 showing that Lion blue bechin had been sold to his store really
referred to Lion-Tiger brand bechin After this hearing, herein respondent-appellee Director of
Patents issued resolution No. 20, dated October 14, 1963, denying the petition to set aside
judgment, pertinent portions of which resolution reads:
Therefore, from the facts established, no extrinsic or collateral fraud would warrant the setting
aside of the judgment herein already rendered.
This office has also carefully considered the possible value of the evidence purportedly showing
that the Opposer falsified its receipt to be proven through the testimony of Ricardo Monfero. His
testimony is of course, immaterial to the issue because what should have been proven was the
alleged fraud but, inasmuch as the purpose for his presentation as witness and the nature of his
testimony has been revealed, this Office might as well rule now that such character of evidence can
not be considered as a new evidence which would alter the result of the proceedings.
Her motion for reconsideration of the resolution denying the petition to set aside judgment having
been denied, petitioner-appellant filed a notice of appeal "from the decision of the Director of
Patents to the Supreme Court on the ground that said decision is not supported by the evidence
presented and is contrary to law."
In her brief, petitioner-appellant contends that respondent Director of Patents committed the
following errors:1äwphï1.ñët
1. In denying the petition to set aside judgment and resolving that there was no fraud perpetrated
against petitioner-appellant, as contemplated under section 2 of Rule 38 of the Rules of Court; .
2. In holding that a client is bound even by fraudulent and deliberate lapses of his counsel;.
3. In holding that the testimony of the petitioner-appellant's witness, Ricardo Monfero, is

immaterial and that it cannot be considered as a newly discovered evidence which would alter the
result of the proceedings;
4. In holding that the prior user of the trademark in question is the respondent-appellee, The
American Food Manufacturing Company;
5. In giving more credence to the invoices of the respondent company than on the testimony of the
respondent company's customers denying the genuineness and the truth of the facts contained in
said invoices;
6. In not considering the failure of the respondent company to register the trademark in question
earlier than 1958 as negating its claim of its prior use as early as 1953; and.
7. In rejecting the application for registration of trademark Lion and Representation in the vetsin
food products of petitioner-appellant and in sustaining the opposition of the respondent company.
We have noted, upon a reading of herein appellant's notice of appeal and appeal brief, that she
does not only question the correctness of the resolution of appellee Director of Patents denying the
petition to set aside the decision of June 14, 1961 but at the same time prays for the reversal of the
said decision. We believe that in this appeal the most that appellant can ask this Court is to pass
upon the correctness of the resolution denying the petition to set aside the decision.
The record shows that the decision proper, which was rendered on June 14, 1961, had already
become final, because counsel for the appellant had been furnished with copy of said decision on
June 16, 1961 and no appeal had been taken from said decision within the reglementary period.
Appellant admits that she had lost completely her right to appeal from the decision.4 It is a settled
rule that notice of any decision or order of a court to counsel is also notice to the client.5 Appellant
claims that she became aware of the decision only during the last week of October, 1961.6 Indeed
she took the proper step when on December 14, 1961 she filed a petition to set aside the decision
upon the alleged ground of fraud pursuant to Section 2 of Rule 38 of the Rules of Court. That
petition to set aside the decision, however, was denied by the respondent-appellee Director of
Patents on October 14, 1963. It is only from this order denying the petition to set aside the decision
that herein appellant can now appeal to this Court, and not from the decision proper which was
rendered on June 14, 1961. We are, therefore, concerned only in determining whether the
respondent-appellee Director of Patents had correctly denied the petition to set aside the decision
of June 14, 1961. In this connection, we shall dwell only on the first three errors that have been
assigned by the petitioner-appellant.
Petitioner-appellant, in support of the first three assigned errors which she discussed jointly, argues
that the acts committed by her former counsel, Atty. Bienvenido Medel, constitute fraud that
would warrant the setting aside of the decision denying her application to register the controverted
trademark. These acts, allegedly, are: his having kept her ignorant of the proceedings of the case;
his having failed to file a memorandum after the hearing of the evidence before the Patent Office;
his having failed to notify her of the adverse decision after receiving notice of it, of which decision
she came to know only after five months from the time it was rendered; his having intentionally
kept himself entirely out of her reach, thereby causing her to lose the right to appeal in due time
and preventing her from informing counsel of the newly discovered evidence which might have
changed the decision had it been timely presented. Petitioner-appellant also claims that the acts of
her counsel also prevented her from presenting all her case before the Patent Office and deprived
her of other available legal remedies. She claims, furthermore, that the acts and/or behavior of her
counsel cannot be considered honest mistakes, but are fraudulent and deliberate lapses or
omissions on his part, which cannot bind her as a client. She also claims that the Director of Patents
erred in finding that the testimony of Ricardo Monfero during the hearing on the petition to set
aside the decision was immaterial, because this witness precisely testified that the invoices relied
upon by the Director of Patents in finding that respondent The American Food Manufacturing
Company had been using the trademark at least since 1957 referred to the trademark "Lion-Tiger"
of said respondent and not to the trademark in question, and so this testimony had directly refuted
the basis of the findings of facts of the respondent Director.
Respondent-appellee Director of Patents, on the other hand, contends that the basic issue in the
petition to set aside the decision of June 14, 1961 is whether there was fraud, as contemplated in
section 2 of Rule 38 of the Rules of Court, to justify the setting aside of the decision. This
respondent-appellee maintains that the acts or omissions of her counsel, cited by petitioner-
appellant as constituting fraud, had not prevented her from presenting fully her case, such that it
could not be said that there had never been a real contest before the Patent Office regarding the
subject matter of the suit. He further maintains that the acts of petitioner-appellant's counsel
complained of, including the failure to file the memorandum, refer to procedural matters, and were
binding on her. Regarding the merit, of the testimony of Monfero, respondent-appellee Director of
Patents contends that there is no use in discussing the same because fraud as would warrant the
setting aside of the judgment had not been shown.
We uphold the stand of respondent-appellee Director of Patents.
Section 2 of Rule 38 of the Rules of Court provides that a judgment or order entered against a party
through fraud, accident, mistake or excusable negligence may be set aside upon proper petition to
that effect. Not every kind of fraud, however, is sufficient ground to set aside a judgment. This
Court has held that only extrinsic or collateral, as distinguished from intrinsic, fraud is a ground for
annulling a judgment.7 Extrinsic fraud refers to any fraudulent act of the successful party in a
litigation which is committed outside the trial of a case against the defeated party, or his agents,
attorneys or witnesses, whereby said defeated party is prevented from presenting fully and fairly
his side of the case. On the other hand, intrinsic fraud refers to acts of a party in a litigation during
the trial, such as the use of forged instruments on perjured testimony, which did not affect the
presentation of the case, but did prevent a fair and just determination of the case.8 The distinctions
are pointed out in the case of United States v. Throckmorton, 98 U.S. 61, 25 L. Ed. 93, — the very
case cited by petitioner-appellant — where the court said:
Where the unsuccessful party had been prevented from exhibiting fully his case, by fraud or
deception practiced on him by his opponent, as by keeping him away from court, a false promise of
a compromise; or where the defendant never had knowledge of the suit, being kept in ignorance by
the acts of the plaintiff; or where an attorney fraudulently or without authority assumes to
represent a party and connives at his defeat; or where the attorney regularly employed corruptly
sells out his client's interest to the other side - these, and similar cases which show that there has
never been a real contest in the trial or hearing of the case, are reasons for which a new suit may
be sustained to set aside and annul the former judgment or decree, and open the case for a new
and fair hearing.
xxx xxx xxx
On the other hand, the doctrine is equally well settled that the court will not set aside a judgment
because it was founded on a fraudulent instrument, or perjured evidence, or for any matter which
was actually presented and considered in the judgment assailed.
In this connection, this Court, in the case of Varela vs. Villanueva, etc., et al., 95 Phil. 248, 258, said:.
The rule is that an action to annul a judgment, upon the ground of fraud, will not lie unless the
fraud be extrinsic or collateral and the facts upon which it is based have not been controverted or
resolved in the case where the judgment sought to be annulled was rendered, and that false
testimony or perjury is not a ground for assailing said judgment, unless the fraud refers to
jurisdiction (Labayen vs. Talisay-Silay Milling Co., 68 Phil. 376); that fraud has been regarded as
extrinsic or collateral, where it has prevented a party from having a trial or from presenting all of
his case to the court (33 Am. Jur. pp. 230-232). The reason for this rule has been aptly stated in
Almeda, et al. vs. Cruz, 47 Off. Gaz., 1179:
'Fraud to be ground for nullity of a judgment must be extrinsic to the litigation. Were not this the
rule there would be no end to litigations, perjury being of such common occurrence in trials. In fact,
under the opposite rule, the losing party could attack the judgment at any time by attributing
imaginary falsehood to his adversary's proofs. But the settled law is that judicial determination
however erroneous of matters brought within the court's jurisdiction cannot be invalidated in
another proceeding. It is the business of a party to meet and repel his opponent's perjured
evidence.'
The acts complained of by petitioner-appellant, even if assumed to be true and fraudulent, were all
committed by her own counsel, and not by the successful party or opponent in the case. Hence,
petitioner-appellant had not shown extrinsic fraud that would warrant the setting aside of the
decision.
Negligence, mistake or fraud of one's own attorney is not ground for granting a new trial. (O'Quinn
v. Tate, [Tex.] Civ. App. 187 S.W. 2d 241).
xxx xxx xxx
Fraud, such as would authorize the setting aside of the verdict at the instance of the movant, is
fraud of respondent or his counsel. She is not at liberty to avail herself of the misconduct of her
own counsel, for the purpose of annulling the verdict obtained by respondent. (Ketchem v.
Ketchem, 11 S.E. 2d 788).
xxx xxx xxx
In order to obtain relief on this ground it must appear that the fraud was practiced or participated
in by the judgment creditor, or his agent or attorney. The fraud must have been practiced upon the
opposite party." (Amuran vs. Aquino, 38 Phil. 29; Velayo vs. Shell Company of the Philippines, Ltd.,
G.R. No. L-8883, July 14, 1959.).
The record shows that petitioner-appellant had all the opportunity to present fully her side of the
case before the decision was rendered, because she and her witnesses. Estrellita Concepcion and
Adela Palmario, testified in the case. The decision in question itself states that "The record of the
case consisting of respondent-applicant's application, the testimonies on behalf of the parties with
accompanying exhibits and the opposer's memorandum have been given careful consideration."9
The failure to submit a memorandum was also the negligence of her counsel and could not in any
manner be attributed to any fraud or deception practiced by her opponent.
This Court has held that mistakes of counsel as to the competency of witnesses, the sufficiency and
relevancy of evidence, the proper defense, or the burden of proof, his failure to introduce certain
evidence, or to summon witnesses and to argue the case, are not proper grounds for a new trial,
unless the incompetence of counsel be so great that his client is prejudiced and prevented from
fairly presenting his case. 10
Anent appellant's not having been informed of the adverse decision, this Court has held that:
The failure of counsel to notify her on time of the adverse judgment to enable her to appeal
therefrom does not constitute excusable negligence. Notice sent to counsel of record is binding
upon the client and the neglect or failure of counsel to inform him of an adverse judgment resulting
in the loss of his right to appeal is not a ground for setting aside a judgment valid and regular on its
face. (Duran v. Pagarigan, L-12573, Jan. 29, 1960).
xxx xxx xxx
Relief under Rule 38 will not be granted to a party who seeks relief from the effects of a judgment
on the ground of fraud, where the loss of the remedy is due to his own fault or negligence or that of
his counsel." (Echevarri v. Velasco, 55 Phil. 570.)
The claim of petitioner-appellant that she had evidence, to disprove the claim of opposer (herein
appellee The American Food Manufacturing Company) that it was the prior user of the trademark
in question, and to show that the receipts issued by opposer purporting to be in connection with
the sale of Lion brand bechin were falsified, is tantamount to saying that her adversary in this case
had presented false evidence consisting of perjured testimonies and falsified documents. But even
assuming that the evidence presented by respondent-appellee The American Food Manufacturing
Company was false, this circumstance would not constitute extrinsic fraud, but only intrinsic fraud.
This Court, in a number of cases, held:
Assuming that there were falsities on the aspect of the case, they make out merely intrinsic fraud
which, as already noted, is not sufficient to annul a judgment. (Varela vs. Villanueva, etc., et al.,
supra).
xxx xxx xxx

And we have recently ruled that presentation of false testimony or the concealment of evidentiary
facts does not per se constitute extrinsic fraud, the only kind of fraud sufficient to annul a court
decision. (Cortes vs. Brownell, Jr., etc., et al., 97 Phil. 542, 548).
xxx xxx xxx
That the testimony upon which a judgment has been based was false or perjured is no ground to
assail said judgment, unless the fraud refers to jurisdiction" (Labayen, et al. vs. Talisay-Silay Milling
Co., 68 Phil. 376, 383, quoting Scotten vs. Rosenblum, 231 Fed., 357; U.S. vs. Chung Shee, 71 Fed.
277; Giffen vs. Christ's Church, 48 Cal. A. 151; 191 P. 718; Pratt vs. Griffin, 223 Ill., 349; 79 N.E., 102).
xxx xxx xxx
As a general rule, extrinsic or collateral fraud would warrant a court of justice to set aside or annul a
judgment, based on fraud (Labayen, et al. v. Talisay-Silay Milling Co., G.R. No. 45843, June 30, 1939,
L.J. Aug. 15, 1939). In seeking the annulment of the decision of Civil Case No. 833 (CA-G.R. No.
8085-R), the alleged fraud does not refer to jurisdiction, but to the admission by the trial court in
said case, of supposedly false or forged documents, which is intrinsic in character. (Velasco, et al.
vs. Velasco, G.R. No. L-15129, June 30, 1961).
We find that respondent-appellee Director of Patents correctly ruled that the testimony of Ricardo
Monfero, — a witness presented by the petitioner-appellant during the hearing on the petition to
set aside the decision — is immaterial to the issue of whether or not the decision should be set
aside. This witness did not testify on any matter which would establish extrinsic fraud that would
warrant the setting aside of the decision.
As we have adverted to at the early part of this opinion, this appeal must be treated only as an
appeal from the resolution of respondent-appellee Director of Patents, dated October 14, 1963,
denying the petition to set aside the decision rendered on June 14, 1961. Having found that
respondent Director of Patents committed no error in denying the petition to set aside the decision,
we do not consider it necessary to discuss the other errors assigned by petitioner-appellant
because those other errors are not pertinent to the appeal now before this Court.
WHEREFORE, the instant appeal is dismissed. The resolution of the Director of Patents, dated
October 14, 1963, denying petitioner-appellant's petition to set aside the decision, dated June 14,
1961, in Inter Partes Case No. 130 before the Philippine Patent Office, is affirmed. Costs against
petitioner-appellant. It is so ordered.
Concepcion, C.J., Reyes, J.B.L., Dizon, Makalintal, Sanchez, Castro, Angeles and Fernando, JJ.,
concur.
G.R. No. 167232 July 31, 2009
D.B.T. MAR-BAY CONSTRUCTION, INCORPORATED, Petitioner,

vs.
RICAREDO PANES, ANGELITO PANES, SALVADOR CEA, ABOGADO MAUTIN, DONARDO PACLIBAR,
ZOSIMO PERALTA and HILARION MANONGDO, Respondents.
DECISION
NACHURA, J.:
Before this Court is a Petition1 for Review on Certiorari under Rule 45 of the Rules of Civil
Procedure, assailing the Court of Appeals (CA) Decision2 dated October 25, 2004 which reversed
and set aside the Order3 of the Regional Trial Court (RTC) of Quezon City, Branch 216, dated
November 8, 2001.
The Facts
Subject of this controversy is a parcel of land identified as Lot Plan Psu-123169,4 containing an area
of Two Hundred Forty Thousand, One Hundred Forty-Six (240,146) square meters, and situated at
Barangay (Brgy.) Pasong Putik, Novaliches, Quezon City (subject property). The property is included
in Transfer Certificate of Title (TCT) No. 200519,5 entered on July 19, 1974 and issued in favor of
B.C. Regalado & Co. (B.C. Regalado). It was conveyed by B.C. Regalado to petitioner D.B.T. Mar-Bay
Construction, Inc. (DBT) through a dacion en pago6 for services rendered by the latter to the
former.
On June 24, 1992, respondents Ricaredo P. Panes (Ricaredo), his son Angelito P. Panes (Angelito),
Salvador Cea, Abogado Mautin, Donardo Paclibar, Zosimo P. Peralta, and Hilarion Manongdo
(herein collectively referred to as respondents) filed a Complaint7 for "Quieting of Title with
Cancellation of TCT No. 200519 and all Titles derived thereat (sic), Damages, with Petition for the
Issuance of Injunction with Prayer for the Issuance of Restraining Order Ex-Parte, Etc." against B.C.
Regalado, Mar-Bay Realty, Inc., Spouses Gereno Brioso and Criselda M. Brioso, Spouses Ciriaco and
Nellie Mariano, Avelino C. Perdido and Florentina Allado, Eufrocina A. Maborang and Fe Maborang,
Spouses Jaime and Rosario Tabangcura, Spouses Oscar Ikalina and the Register of Deeds (RD) of
Quezon City. Subsequently, respondents filed an Amended Complaint8 and a Second Amended
Complaint9 particularly impleading DBT as one of the defendants.
In the Complaints, Ricaredo alleged that he is the lawful owner and claimant of the subject property
which he had declared for taxation purposes in his name, and assessed in the amount of
₱2,602,190.00 by the City Assessor of Quezon City as of the year 1985. Respondents alleged that
per Certification10 of the Department of Environment and Natural Resources (DENR) National
Capital Region (NCR) dated May 7, 1992, Lot Plan Psu-123169 was verified to be correct and on file
in said office, and approved on July 23, 1948.
Respondents also claimed that Ricaredo, his immediate family members, and the other
respondents had been, and still are, in actual possession of the portions of the subject property,
and their possession preceded the Second World War. To perfect his title in accordance with Act
No. 496 (The Land Registration Act) as amended by Presidential Decree (P.D.) No. 1529 (The
Property Registration Decree), Ricaredo filed with the RTC of Quezon City, Branch 82 a case
docketed as LRC Case No. Q-91-011, with LRC Rec. No. N-62563.11
Respondents averred that in the process of complying with the publication requirements for the
Notice of Initial Hearing with the Land Registration Authority (LRA), it was discovered by the
Mapping Services of the LRA that there existed an overlapping of portions of the land subject of
Ricaredo’s application, with the subdivision plan of B.C. Regalado. The said portion had, by then,
already been conveyed by B.C. Regalado to DBT.
Ricaredo asseverated that upon verification with the LRA, he found that the subdivision plan of B.C.
Regalado was deliberately drawn to cover portions of the subject property. Respondents claimed
that the title used by B.C. Regalado in the preparation of the subdivision plan did not actually cover
the subject property. They asserted that from the records of B.C. Regalado, they gathered that TCT
Nos. 211081,12 21109513 and 211132,14 which allegedly included portions of the subject property,
were derived from TCT No. 200519. However, TCT No. 200519 only covered Lot 503 of the Tala
Estate with an area of Twenty-Two Thousand Six Hundred Fifteen (22,615) square meters, and was
different from those mentioned in TCT Nos. 211081, 211095 and 211132. According to
respondents, an examination of TCT No. 200519 would show that it was derived from TCT Nos.
14814,15 14827,16 1481517 and T-28.
In essence, respondents alleged that B.C. Regalado and DBT used the derivative titles which
covered properties located far from Pasong Putik, Novaliches, Quezon City where the subject
property is located, and B.C. Regalado and DBT then offered the same for sale to the public.
Respondents thus submitted that B.C Regalado and DBT through their deliberate scheme, in
collusion with others, used (LRC) Pcs-18345 as shown in the consolidation-subdivision plan to
include the subject property covered by Lot Plan Psu-123169.
In his Answer18 dated July 24, 1992, the RD of Quezon City interposed the defense that at the time
of registration, he found all documents to be in order. Subsequently, on December 5, 1994, in his
Motion19 for Leave to Admit Amended Answer, with the Amended Answer attached, he admitted
that he committed a grave mistake when he earlier said that TCT No. 200519 covered only one lot,
i.e. Lot 503. He averred that upon careful examination, he discovered that TCT No. 200519 is
composed of 17 pages, and actually covered 54 lots, namely: Lots 503, 506, 507, 508, 509, 582, 586,
655, 659, 686, 434, 495, 497, 299, 498, 499, 500, 501, 502, 493, 692, 776, 496, 785, 777, 786, 780,
783, 505, 654, 660, 661, 663, 664, 665, 668, 693, 694, 713, 716, 781, 779, 784, 782, 787, 893, 1115,
1114, 778, 669 and 788, all of the Tala Estate. Other lots included therein are Lot 890-B of Psd
36854, Lot 2 of (LRC) Pcs 12892 and Lot 3 of (LRC) Pcs 12892. Thus, respondents' allegation that
Lots 661, 664, 665, 693 and 694 of the Tala Estate were not included in TCT No. 200519 was not
true.
On December 28, 1993, then defendants Spouses Jaime and Rosario Tabangcura (Spouses
Tabangcura) filed their Answer20 with Counterclaim, claiming that they were buyers in good faith
and for value when they bought a house and lot covered by TCT No. 211095 from B.C. Regalado,
the latter being a subdivision developer and registered owner thereof, on June 30, 1986. When
respondent Abogado Mautin entered and occupied the property, Spouses Tabangcura filed a case
for Recovery of Property before the RTC, Quezon City, Branch 97 which rendered a decision21 in
their favor.
On its part, DBT, traversing the complaint, alleged that it is the legitimate owner and occupant of
the subject property pursuant to a dacion en pago executed by B.C. Regalado in the former’s favor;
that respondents were not real parties-in-interests because Ricaredo was a mere claimant whose
rights over the property had yet to be determined by the RTC where he filed his application for
registration; that the other respondents did not allege matters or invoke rights which would entitle
them to the relief
prayed for in their complaint; that the complaint was premature; and that the action inflicted a
chilling effect on the lot buyers of DBT.22
The RTC's Rulings
On June 15, 2000, the RTC through Judge Marciano I. Bacalla (Judge Bacalla), rendered a Decision23
in favor of the respondents. The RTC held that the testimony of Ricaredo that he occupied the
subject property since 1936 when he was only 16 years old had not been rebutted; that Ricaredo's
occupation and cultivation of the subject property for more than thirty (30) years in the concept of
an owner vested in him equitable ownership over the same by virtue of an approved plan, Psu
123169; that the subject property was declared under the name of Ricaredo for taxation
purposes;24 and that the subject property per survey should not have been included in TCT No.
200519, registered in the name of B.C. Regalado and ceded to DBT. The RTC further held that
Spouses Tabangcura failed to present satisfactory evidence to prove their claim. Thus, the RTC
disposed of the case in this wise:
WHEREFORE, in view of the foregoing considerations, judgment is hereby rendered declaring

Certificate of Title No. 200519 and all titles derived thereat as null and void insofar as the same
embrace the land covered by Plan PSU-123169 with an area of 240,146 square meters in the name
of Ricaredo Panes; ordering defendant DBT Marbay Realty, Inc. to pay plaintiff Ricaredo Panes the
sum of TWENTY THOUSAND (₱20,000) pesos as attorney’s fees plus costs of suit.
SO ORDERED.
On September 12, 2000, DBT filed a Motion25 for Reconsideration, based on the grounds of
prescription and laches. DBT also disputed Ricaredo’s claim of open, adverse, and continuous
possession of the subject property for more than thirty (30) years, and asserted that the subject
property could not be acquired by prescription or adverse possession because it is covered by TCT
No. 200519.
While the said Motion for Reconsideration was pending, Judge Bacalla passed away.
Meanwhile, on January 2, 2001, a Motion26 for Intervention and a Complaint in Intervention were
filed by Atty. Andres B. Pulumbarit (Atty. Pulumbarit), representing the Don Pedro/Don Jose de
Ocampo Estate. The intervenor alleged that the subject property formed part of the vast tract of
land with an area of 117,000 hectares, covered by Original Certificate of Title (OCT) No. 779 issued
by the Honorable Norberto Romualdez on March 14, 1913 under Decree No. 10139, which belongs
to the Estate of Don Pedro/Don Jose de Ocampo. Thus, the Complaint27 in Intervention prayed that
the RTC’s Decision be reconsidered; that the legitimacy and superiority of OCT 779 be upheld; and
that the subject property be declared as belonging to the Estate of Don Pedro/Don Jose de
Ocampo.
In its Order28 dated March 13, 2001, the RTC, through Acting Judge Modesto C. Juanson (Judge
Juanson), denied Atty. Pulumbarit’s Motion for Intervention because a judgment had already been
rendered pursuant to Section 2,29 Rule 19 of the 1997 Rules of Civil Procedure.
On April 10, 2001, the RTC issued an Order30 stating that there appeared to be a need for a
clarificatory hearing before it could act on DBT's Motion for Reconsideration. Thus, a hearing was
held on May 17, 2001. Thereafter, supplemental memoranda were required of the parties.31 Both
parties complied.32 However, having found that the original copy of TCT No. 200519 was not
submitted to it for comparison with the photocopy thereof on file, the RTC directed DBT to present
the original or certified true copy of the TCT on August 21, 2001.33 Respondents moved to
reconsider the said directive34 but the same was denied.35 DBT, on the other hand, manifested
that a copy of TCT No. 200519, consisting of 17 pages, had already been admitted in evidence; and
that because of the fire in the Office of the RD in Quezon City sometime in 1988, DBT, despite
diligent effort, could not secure an original or certified true copy of said TCT. Instead, DBT
submitted a certified true copy of Consolidated Subdivision Plan Pcs 18345.36
On November 8, 2001, the RTC, through Judge Juanson, issued an Order37 reversing the earlier RTC
Decision and dismissing the Complaint for lack of merit. The RTC held that prescription does not run
against registered land; hence, a title once registered cannot be defeated even by adverse, open or
notorious possession. Moreover, the RTC opined that even if the subject property could be
acquired by prescription, respondents' action was already barred by prescription and/or laches
because they never asserted their rights when B.C. Regalado registered the subject property in
1974; and later developed, subdivided and sold the same to individual lot buyers.
On December 18, 2001, respondents filed a Motion for Reconsideration38 which the RTC denied in
its Order39 dated June 17, 2002. Aggrieved, respondents appealed to the CA.40
The CA's Ruling
On October 25, 2004, the CA reversed and set aside the RTC Orders dated November 8, 2001 and
June 17, 2002 and reinstated the RTC Decision dated June 15, 2000. The CA held that the properties
described and included in TCT No. 200519 are located in San Francisco del Monte, San Juan del
Monte, Rizal and Cubao, Quezon City while the subject property is located in Brgy. Pasong Putik,
Novaliches, Quezon City. Furthermore, the CA held that Engr. Vertudazo's testimony that there is a
gap of around 1,250 meters between Lot 503 and Psu 123169 was not disproved or refuted. The CA
found that Judge Juanson committed a procedural infraction when he entertained issues and
admitted evidence presented by DBT in its Motion for Reconsideration which were never raised in
the pleadings and proceedings prior to the rendition of the RTC Decision. The CA opined that DBT's
claims of laches and prescription clearly appeared to be an afterthought. Lastly, the CA held that
DBT's Motion for Reconsideration was not based on grounds enumerated in the Rules of
Procedure.41
Petitioner filed a Motion for Reconsideration,42 which was, however, denied by the CA in its
Resolution43 dated February 22, 2005.
Hence, this Petition.
The Issues
Petitioner raises the following as grounds for this Petition:
I.
PETITIONER'S FAILURE TO ALLEGE PRESCRIPTION IN ITS ANSWER IS NOT A WAIVER OF SUCH

DEFENSE.
II.
IT IS NOT ERRONEOUS TO REQUIRE THE PRODUCTION OF A CERTIFIED TRUE COPY OF TCT NO.
200519 AFTER THE DECISION ON THE MERITS HAS BEEN RENDERED BUT BEFORE IT BECAME FINAL.
III.
A REGISTERED LAND CAN NOT BE ACQUIRED BY ACQUISITIVE PRESCRIPTION.
IV.
THE TESTIMONY OF ENGR. VERTUDAZO ON THE BASIS OF THE TECHNICAL DESCRIPTION OF LOT 503
IN AN INCOMPLETE DOCUMENT IS UNRELIABLE.
V.
MR. PANES HAS NEVER BEEN IN OPEN, ADVERSE AND CONTINUOUS POSSESSION OF THE SUBJECT
PROPERTY FOR MORE THAN THIRTY (30) YEARS.44
Distilled from the petition and the responsive pleadings, and culled from the arguments of the
parties, the issues may be reduced to two questions, namely:
1) Did the RTC err in upholding DBT's defenses of prescription and laches as raised in the latter's
Motion for Reconsideration?
2) Which between DBT and the respondents have a better right over the subject property?
Our Ruling
We answer the first question in the affirmative.
It is true that in Dino v. Court of Appeals45 we ruled:

(T)rial courts have authority and discretion to dismiss an action on the ground of prescription when
the parties' pleadings or other facts on record show it to be indeed time-barred; (Francisco v.
Robles, Feb. 15, 1954; Sison v. McQuaid, 50 O.G. 97; Bambao v. Lednicky, Jan. 28, 1961; Cordova v.
Cordova, Jan. 14, 1958; Convets, Inc. v. NDC, Feb. 28, 1958; 32 SCRA 529; Sinaon v. Sorongan, 136
SCRA 408); and it may do so on the basis of a motion to dismiss (Sec. 1, [f] Rule 16, Rules of Court),
or an answer which sets up such ground as an affirmative defense (Sec. 5, Rule 16), or even if the
ground is alleged after judgment on the merits, as in a motion for reconsideration (Ferrer v. Ericta,
84 SCRA 705); or even if the defense has not been asserted at all, as where no statement thereof is
found in the pleadings (Garcia v. Mathis, 100 SCRA 250; PNB v. Pacific Commission House, 27 SCRA
766; Chua Lamco v. Dioso, et al., 97 Phil. 821); or where a defendant has been declared in default
(PNB v. Perez; 16 SCRA 270). What is essential only, to repeat, is that the facts demonstrating the
lapse of the prescriptive period be otherwise sufficiently and satisfactorily apparent on the record;
either in the averments of the plaintiff's complaint, or otherwise established by the evidence.
(Emphasis supplied)
Indeed, one of the inherent powers of courts is to amend and control its processes so as to make
them conformable to law and justice. This includes the right to reverse itself, especially when in its
opinion it has committed an error or mistake in judgment, and adherence to its decision would
cause injustice.46 Thus, the RTC in its Order dated November 8, 2001 could validly entertain the
defenses of prescription and laches in DBT's motion for reconsideration.
However, the conclusion reached by the RTC in its assailed Order was erroneous. The RTC failed to
consider that the action filed before it was not simply for reconveyance but an action for quieting of
title which is imprescriptible.
Verily, an action for reconveyance can be barred by prescription. When an action for reconveyance
is based on fraud, it must be filed within four (4) years from discovery of the fraud, and such
discovery is deemed to have taken place from the issuance of the original certificate of title. On the
other hand, an action for reconveyance based on an implied or constructive trust prescribes in ten
(10) years from the date of the issuance of the original certificate of title or transfer certificate of
title. The rule is that the registration of an instrument in the Office of the RD constitutes
constructive notice to the whole world and therefore the discovery of the fraud is deemed to have
taken place at the time of registration.47lavvphil
However, the prescriptive period applies only if there is an actual need to reconvey the property as
when the plaintiff is not in possession of the property. If the plaintiff, as the real owner of the
property also remains in possession of the property, the prescriptive period to recover title and
possession of the property does not run against him. In such a case, an action for reconveyance, if
nonetheless filed, would be in the nature of a suit for quieting of title, an action that is
imprescriptible.48 Thus, in Vda. de Gualberto v. Go,49 this Court held:
[A]n action for reconveyance of a parcel of land based on implied or constructive trust prescribes in
ten years, the point of reference being the date of registration of the deed or the date of the
issuance of the certificate of title over the property, but this rule applies only when the plaintiff or
the person enforcing the trust is not in possession of the property, since if a person claiming to be
the owner thereof is in actual possession of the property, as the defendants are in the instant case,
the right to seek reconveyance, which in effect seeks to quiet title to the property, does not
prescribe. The reason for this is that one who is in actual possession of a piece of land claiming to
be the owner thereof may wait until his possession is disturbed or his title is attacked before taking
steps to vindicate his right, the reason for the rule being, that his undisturbed possession gives him
a continuing right to seek the aid of a court of equity to ascertain and determine the nature of the
adverse claim of a third party and its effect on his own title, which right can be claimed only by one
who is in possession.
Insofar as Ricaredo and his son, Angelito, are concerned, they established in their testimonies that,
for some time, they possessed the subject property and that Angelito bought a house within the
subject property in 1987.50 Thus, the respondents are proper parties to bring an action for quieting
of title because persons having legal, as well as equitable, title to or interest in a real property may
bring such action, and "title" here does not necessarily denote a certificate of title issued in favor of
the person filing the suit.51
Although prescription and laches are distinct concepts, we have held, nonetheless, that in some
instances, the doctrine of laches is inapplicable where the action was filed within the prescriptive
period provided by law. Therefore, laches will not apply to this case, because respondents'
possession of the subject property has rendered their right to bring an action for quieting of title
imprescriptible and, hence, not barred by laches. Moreover, since laches is a creation of equity, acts
or conduct alleged to constitute the same must be intentional and unequivocal so as to avoid
injustice. Laches will operate not really to penalize neglect or sleeping on one's rights, but rather to
avoid recognizing a right when to do so would result in a clearly inequitable situation.52
Albeit the conclusion of the RTC in its Order dated November 8, 2001, which dismissed
respondents' complaint on grounds of prescription and laches, may have been erroneous, we,
nevertheless, resolve the second question in favor of DBT.
It is a well-entrenched rule in this jurisdiction that no title to registered land in derogation of the
rights of the registered owner shall be acquired by prescription or adverse possession.53
Article 112654 of the Civil Code in connection with Section 4655 of Act No. 496 (The Land
Registration Act), as amended by Section 4756 of P.D. No. 1529 (The Property Registration Decree),
clearly supports this rule. Prescription is unavailing not only against the registered owner but also
against his hereditary successors. Possession is a mere consequence of ownership where land has
been registered under the Torrens system, the efficacy and integrity of which must be protected.
Prescription is rightly regarded as a statute of repose whose objective is to suppress fraudulent and
stale claims from springing up at great distances of time and surprising the parties or their
representatives when the facts have become obscure from the lapse of time or the defective
memory or death or removal of witnesses.57
Thus, respondents' claim of acquisitive prescription over the subject property is baseless. Under
Article 1126 of the Civil Code, acquisitive prescription of ownership of lands registered under the
Land Registration Act shall be governed by special laws. Correlatively, Act No. 496, as amended by
PD No. 1529, provides that no title to registered land in derogation of that of the registered owner
shall be acquired by adverse possession. Consequently, in the instant case, proof of possession by
the respondents is immaterial and inconsequential.58
Moreover, it may be stressed that there was no ample proof that DBT participated in the alleged
fraud. While factual issues are admittedly not within the province of this Court, as it is not a trier of
facts and is not required to re-examine or contrast the oral and documentary evidence anew, we
have the authority to review and, in proper cases, reverse the factual findings of lower courts when
the findings of fact of the trial court are in conflict with those of the appellate court.59 In this
regard, we reviewed the records of this case and found no clear evidence that DBT participated in
the fraudulent scheme. In Republic v. Court of Appeals,60 this Court gave due importance to the
fact that the private respondent therein did not participate in the fraud averred. We accord the
same benefit to DBT in this case. To add, DBT is an innocent purchaser for value and good faith
which, through a dacion en pago duly entered into with B.C. Regalado, acquired
ownership over the subject property, and whose rights must be protected under Section 3261 of
P.D. No. 1529.
Dacion en pago is the delivery and transmission of ownership of a thing by the debtor to the
creditor as an accepted equivalent of the performance of the obligation. It is a special mode of
payment where the debtor offers another thing to the creditor, who accepts it as an equivalent of
the payment of an outstanding debt. In its modern concept, what actually takes place in dacion en
pago is an objective novation of the obligation where the thing offered as an accepted equivalent of
the performance of an obligation is considered as the object of the contract of sale, while the debt
is considered as the purchase price.62
It must also be noted that portions of the subject property had already been sold to third persons
who, like DBT, are innocent purchasers in good faith and for value, relying on the certificates of title
shown to them, and who had no knowledge of any defect in the title of the vendor, or of facts
sufficient to induce a reasonably prudent man to inquire into the status of the subject property.63
To disregard these circumstances simply on the basis of alleged continuous and adverse possession
of respondents would not only be inimical to the rights of the aforementioned titleholders, but
would ultimately wreak havoc on the stability of the Torrens system of registration.
A final note.
While the Torrens system is not a mode of acquiring title, but merely a system of registration of
titles to lands, justice and equity demand that the titleholder should not be made to bear the
unfavorable effect of the mistake or negligence of the State's agents, in the absence of proof of his
complicity in a fraud or of manifest damage to third persons. The real purpose of the Torrens
system is to quiet title to land and put a stop forever to any question as to the legality of the title,
except claims that were noted in the certificate at the time of the registration or that may arise
subsequent thereto. Otherwise, the integrity of the Torrens system would forever be sullied by the
ineptitude and inefficiency of land registration officials, who are ordinarily presumed to have
regularly performed their duties.64 Thus, where innocent third persons, relying on the correctness
of the certificate of title thus issued, acquire rights over the property, the court cannot disregard
those rights and order the cancellation of the certificate. The effect of such outright cancellation
will be to impair public confidence in the certificate of title. The sanctity of the Torrens system must
be preserved; otherwise, everyone dealing with the property registered under the system will have
to inquire in every instance on whether the title had been regularly or irregularly issued, contrary to
the evident purpose of the law. Every person dealing with the registered land may safely rely on the
correctness of the certificate of title issued therefor, and the law will in no way oblige him to go
behind the certificate to determine the condition of the property.65
WHEREFORE, the instant Petition is GRANTED and the assailed Court of Appeals Decision dated
October 25, 2004 is hereby REVERSED and SET ASIDE. A new judgment is hereby entered
DISMISSING the Complaint filed by the respondents for lack of merit.
SO ORDERED.
G.R. No. 147379 February 27, 2002
HEIRS OF AMBROCIO KIONISALA, namely, ANA, ISABEL, GRACE, JOVEN and CARMELO, all
surnamed KIONISALA, petitioners,
vs.
HEIRS OF HONORIO DACUT, namely: VISAMINDA D. OREVILLO, VIOLETA DACUT, JOSEPHINE
DACUT and ELIZABETH DACUT, respondents.
DECISION
BELLOSILLO, J.:
ONCE MORE we are faced with the erroneous application of what are perceived to be elementary
rules of pleading. The misapprehension of the basic concepts underlying these rules can be
befuddling, but what is worse, the lost man-hours spent in untangling the ensuing allegations of
pleading errors causing unnecessary delay in the adjudication of cases. Instead of immediately
resolving the original dispute and adjudicating the merits of conflicting claims, which in the instant
petition involves the ownership of two (2) parcels of land with the sizable area of 187,718 square
meters, the judicial process is unfortunately wasted in the maze of unfounded claims of deficiencies
in the parties’ pleadings.
On 19 December 1995 private respondents filed a complaint for declaration of nullity of titles,
reconveyance and damages against petitioners, docketed as Civil Case No. 95-312 Of the Regional
Trial Court of Manolo Fortich, Bukidnon. This complaint involved two (2) parcels of land known as
Lot No. 1017 and Lot No. 1015 with areas of 117,744 square meters and 69,974 square meters
respectively, located in Pongol, Libona, Bukidnon. On 7 September 1990 Lot No. 1017 was granted a
free patent to petitioners Heirs of Ambrocio Kionisala under Free Patent No. 603393, and on 13
November 1991 Lot 1015 was bestowed upon Isabel Kionisala, one of the impleaded heirs of
Ambrocio Kionisala under Free Patent No. 101311-91-904. Thereafter, on 19 November 1990 Lot
1017 was registered under the Torrens system and was issued Original Certificate of Title No. P-
19819 in petitioners’ name, while on 5 December 1991 Lot No. 1015 was registered in the name of
Isabel Kionisala under Original Certificate of Title No. P-20229.
In support of their causes of action for declaration of nullity of titles and reconveyance, private
respondents claimed absolute ownership of Lot 1015 and 1017 even prior to the issuance of the
corresponding free patents and certificates of title. They further alleged in their complaint -
x x x x 2. That plaintiffs are absolute and exclusive owners and in actual possession and cultivation
of two parcels of agricultural lands herein particularly described as follows [technical description of
Lot 1015 and Lot 1017] x x x x 3. That plaintiffs became absolute and exclusive owners of the
abovesaid parcels of land by virtue of inheritance from their late father, Honorio Dacut, who in turn
acquired the same from a certain Blasito Yacapin and from then on was in possession thereof
exclusively, adversely and in the concept of owner for more than thirty (30) years. In fact Honorio
Dacut has had this parcels of land rented by the Philippine Packing Corporation for more than
twenty years (20) up to the present time; 4. That recently, plaintiff discovered that defendants,
without the knowledge and consent of the former, fraudulently applied for patent the said parcels
of land and as a result thereof certificates of titles had been issued to them as evidenced by
certificate of title No. P-19819 in the name of the Hrs. of Ambrocio Kionisala and No. P-20229 in the
name of Isabel Kionisala, xerox copies of the titles hereto attached and marked as annexes "A" and
"B" and made part hereof; 5. That the patents issued to defendants are null and void, the same
having been issued fraudulently, defendants not having been and/or in actual possession of the
litigated properties and the statement they may have made in their application are false and
without basis in fact, and, the Department of Environment and Natural Resources not having any
jurisdiction on the properties the same not being anymore public but already private property; 6.
That in the remote possibility that said certificates of title cannot be declared as null and void,
plaintiffs, being the absolute and exclusive owners of the parcels of land titled by the defendants,
are entitled to reconveyance x x x x WHEREFORE, premises considered, it is respectfully prayed of
the Honorable Court that judgment issue: 1. declaring certificates of title No. P-19819 and P-20229,
null and void, and in the event that this remedy is not possible, ordering defendants to reconvey to
plaintiffs the land subject matter of this litigation x x x x
The complaint was accompanied by a verification and certificate of non-forum shopping which
affirmed under oath thus -
I, VISAMINDA DACUT OREVILLO, after being duly sworn, states: That I am one of the plaintiffs in the
above-entitled case; that we have caused the preparation and filing of the same and that all
allegations contained therein are true and correct to the best of my own knowledge; That we have
not filed any case in any court or bodies affecting the same subject matter.
On 7 February 1996 petitioners filed their answer to the complaint and asserted the following
affirmative defenses -
8. That the complaint states no cause of action; 9. That the cause of action, if any, is barred by
statute of limitations, prescription of action or by equitable principle of laches; 10. That x x x it is
only the Director of Lands (now DENR) through the Office of the Solicitor General that has the
authority to file annulment of Free Patent or Homestead Patent issued by the Director of Lands or
DENR; That the complaint is not supported by certification of non-forum shopping as required by
Administrative Circular No. 04-94 of the Supreme Court x x x x
Petitioners set for hearing their affirmative defenses. After the hearing, or on 3 December 1996 the
trial court dismissed the complaint on the ground that the cause of action of private respondents
was truly for reversion so that only the Director of Lands could have filed the complaint, and that
the certificate of non-forum shopping accompanying the complaint did not comply with the
standard form for such undertaking.1 On 23 December 1996 private respondents moved for
reconsideration of the order of dismissal but on 3 June 1997 the motion was denied by the trial
court.
On 7 June 1997 private respondents appealed the order of dismissal to the Court of Appeals. On 15
February 2000 the appellate court promulgated its assailed Decision reversing the order of
dismissal.2 The Court of Appeals ruled that while the allegations in the complaint were insufficient
for purposes of an ordinary civil action for declaration of nullity of a certificate of title since the
actual date when private respondents became owners of Lots 1015 and 1017 prior to the issuance
of the corresponding free patents and certificates of title was not specifically indicated in the
complaint, nonetheless the allegations therein were comprehensive enough to constitute a cause
of action for reconveyance.3 The appellate court concluded: "On this score, it was reversible error
for the lower court to have dismissed the complaint x x x because in an action for reconveyance,
what is sought is the transfer of the property which has been wrongfully or erroneously registered
in another person’s name, to its rightful and legal owner or to one with a better right x x x."4 The
appellate court likewise found substantial compliance in the certificate of non-forum shopping5 by
citing Cabardo v. Court of Appeals6 and Kavinta v. Court of Appeals.7
On 7 March 2000 petitioners moved for reconsideration of the CA Decision. On 22 January 2001 the
appellate court denied the motion for lack of merit, hence this petition for review.
At the core of the instant petition is the issue of sufficiency of the complaint filed by private
respondents. Verily, does the complaint allege an action for reversion which private respondents
would have no right to file or institute? Or does the complaint state a cause of action for
declaration of nullity of the free patents and certificates of title for Lot 1015 and Lot 1017, or
alternatively a cause of action for reconveyance of these two lots? Has the cause of action, if any,
prescribed? And does the certificate of non-forum shopping substantially comply with the standard
requirement?
First. The test of the sufficiency of the facts to constitute a cause of action is whether admitting the
facts alleged the court could render a valid judgment upon the same in accordance with the prayer
of the complaint.8 In answering this query, only the facts asserted in the complaint must be taken
into account without modification although with reasonable inferences therefrom.9
Applying the test to the case at bar, we rule that the complaint does not allege an action for
reversion which private respondents would obviously have no right to initiate, but that it
sufficiently states either a cause of action for declaration of nullity of free patents and certificates of
title over Lot 1015 and Lot 1017 or alternatively a cause of action for reconveyance of these two
pieces of realty, wherein in either case private respondents are the real parties in interest.
An ordinary civil action for declaration of nullity of free patents and certificates of title is not the
same as an action for reversion.10 The difference between them lies in the allegations as to the
character of ownership of the realty whose title is sought to be nullified. In an action for reversion,
the pertinent allegations in the complaint would admit State ownership of the disputed land. Hence
in Gabila v. Barriga111 where the plaintiff in his complaint admits that he has no right to demand
the cancellation or amendment of the defendant’s title because even if the title were canceled or
amended the ownership of the land embraced therein or of the portion affected by the
amendment would revert to the public domain, we ruled that the action was for reversion and that
the only person or entity entitled to relief would be the Director of Lands.
On the other hand, a cause of action for declaration of nullity of free patent and certificate of title
would require allegations of the plaintiff’s ownership of the contested lot prior to the issuance of
such free patent and certificate of title as well as the defendant’s fraud or mistake; as the case may
be, in successfully obtaining these documents of title over the parcel of land claimed by plaintiff. In
such a case, the nullity arises strictly not from the fraud or deceit but from the fact that the land is
beyond the jurisdiction of the Bureau of Lands to bestow and whatever patent or certificate of title
obtained therefor is consequently void ab initio.12 The real party in interest is not the State but the
plaintiff who alleges a pre-existing right of ownership over the parcel of land in question even
before the grant of title to the defendant. In Heirs of Marciano Nagano v. Court of Appeals13 we
ruled -
x x x x from the allegations in the complaint x x x private respondents claim ownership of the 2,250
square meter portion for having possessed it in the concept of an owner, openly, peacefully,
publicly, continuously and adversely since 1920. This claim is an assertion that the lot is private land
x x x x Consequently, merely on the basis of the allegations in the complaint, the lot in question is
apparently beyond the jurisdiction of the Director of the Bureau of Lands and could not be the
subject of a Free Patent. Hence, the dismissal of private respondents’ complaint was premature and
trial on the merits should have been conducted to thresh out evidentiary matters. It would have
been entirely different if the action were clearly for reversion, in which case, it would have to be
instituted by the Solicitor General pursuant to Section 101 of C.A. No. 141 x x x x
It is obvious that private respondents allege in their complaint all the facts necessary to seek the
nullification of the free patents as well as the certificates of title covering Lot 1015 and Lot 1017.
Clearly, they are the real parties in interest in light of their allegations that they have always been
the owners and possessors of the two (2) parcels of land even prior to the issuance of the
documents of title in petitioners’ favor, hence the latter could only have committed fraud in
securing them -
x x x x That plaintiffs are absolute and exclusive owners and in actual possession and cultivation of
two parcels of agricultural lands herein particularly described as follows [technical description of
Lot 1017 and Lot 1015] x x x x 3. That plaintiffs became absolute and exclusive owners of the
abovesaid parcels of land by virtue of inheritance from their late father, Honorio Dacut, who in turn
acquired the same from a certain Blasito Yacapin and from then on was in possession thereof
exclusively, adversely and in the concept of owner for more than thirty (30) years x x x x 4. That
recently, plaintiff discovered that defendants, without the knowledge and consent of the former,
fraudulently applied for patent the said parcels of land and as a result thereof certificates of titles
had been issued to them as evidenced by certificate of title No. P-19819 in the name of the Hrs. of
Ambrocio Kionisala, and No. P-20229 in the name of Isabel Kionisala x x x x 5. That the patents
issued to defendants are null and void, the same having been issued fraudulently, defendants not
having been and/or in actual possession of the litigated properties and the statement they may
have made in their application are false and without basis in fact, and, the Department of
Environment and Natural Resources not having any jurisdiction on the properties the same not
being anymore public but already private property x x x x
It is not essential for private respondents to specifically state in the complaint the actual date when
they became owners and possessors of Lot 1015 and Lot 1017. The allegations to the effect that
they were so preceding the issuance of the free patents and the certificates of title, i.e., "the
Department of Environment and Natural Resources not having any jurisdiction on the properties
the same not being anymore public but already private property," are unquestionably adequate as
a matter of pleading to oust the State of jurisdiction to grant the lots in question to petitioners. If at
all, the oversight in not alleging the actual date when private respondents’ ownership thereof
accrued reflects a mere deficiency in details which does not amount to a failure to state a cause of
action. The remedy for such deficiency would not be a motion to dismiss but a motion for bill of
particulars so as to enable the filing of appropriate responsive pleadings.14
With respect to the purported cause of action for reconveyance, it is settled that in this kind of
action the free patent and the certificate of title are respected as incontrovertible.15 What is
sought instead is the transfer of the property, in this case the title thereof, which has been
wrongfully or erroneously registered in the defendant’s name.16 All that must be alleged in the
complaint are two (2) facts which admitting them to be true would entitle the plaintiff to recover
title to the disputed land, namely, (1) that the plaintiff was the owner of the land and, (2) that the
defendant had illegally dispossessed him of the same.17
We rule that private respondents have sufficiently pleaded (in addition to the cause of action for
declaration of free patents and certificates of title) an action for reconveyance, more specifically,
one which is based on implied trust. An implied trust arises where the defendant (or in this case
petitioners) allegedly acquires the disputed property through mistake or fraud so that he (or they)
would be bound to hold and reconvey the property for the benefit of the person who is truly
entitled to it.18 In the complaint, private respondents clearly assert that they have long been the
absolute and exclusive owners and in actual possession and cultivation of Lot 1015 and Lot 1017
and that they were fraudulently deprived of ownership thereof when petitioners obtained free
patents and certificates of title in their names. These allegations certainly measure up to the
requisite statement of facts to constitute an action for reconveyance.
Petitioners would nonetheless insist that private respondents should have also alleged, in addition
to "possession in the concept of owner, openly, peacefully, publicly, continuously and adversely for
thirty (30) years at the least," the statement that Lot 1015 and Lot 1017 have not passed to an
innocent purchaser for value. Petitioners also proffer the trifling argument that (apparently in order
to render sufficient for pleading purposes the allegations of ownership) private respondents should
have attached to their complaint the documents which would prove the sources of their title to the
disputed parcels of land.
It is easy to see why the allegations demanded by petitioners are unnecessary, even improper, in a
complaint. Whether petitioners are innocent purchasers for value of the contested lots is a matter
of defense that private respondents need not anticipate in their complaint; indubitably it lies upon
petitioners’ discretion to allege this fact in their answer perhaps to bar recovery of the two pieces
of realty.19 Moreover, private respondents do not have to asseverate in the complaint the
documents proving their alleged sources of title. These matters are evidentiary details which
undoubtedly find no place in a complaint. Being matters of evidence proving the ultimate fact of
ownership averred by private respondents, the disclosure of such evidence must await either the
proceedings for discovery or pre-trial or even the trial proper. It should also be stressed that in
pleading the ownership of a parcel of land in an action for recovery of ownership/possession
thereof, all that plaintiff is required to state in the complaint are -
x x x a disseisin and its continuance by the defendant x x x x Plaintiff was not required and did not
allege the source and kind of title under which it claimed, and under the complaint, it was at liberty
to introduce proof of any legal title which it possessed. Conversely, the defendants were at liberty
to introduce all legally admissible evidence tending to show that title was not in the plaintiff. Hence,
they had the right to show that the legal title was in themselves. For, if legal title to the property
were shown to be in the defendants, the evidence of the plaintiff that title belonged to it would
certainly be met x x x x It must be furthermore remembered that x x x plaintiff is allowed to make
up his complaint in an action to recover possession of land without disclosing the title which he
intends to rely upon.20
Second. We rule that neither the action for declaration of nullity of free patents and certificates of
title of Lot 1015 and Lot 1017 nor the action for reconveyance based on an implied trust of the
same lots has prescribed. We have ruled that "a free patent issued over private land is null and
void, and produces no legal effects whatsoever. Quos nullum est, nullum producit effectum."21
Moreover, private respondents’ claim of open, public, peaceful, continuous and adverse possession
of the two (2) parcels of land and its illegal inclusion in the free patents of petitioners and in their
original certificates of title, also amounts to an action for quieting of title which is imprescriptible.22
The action for reconveyance based on implied trust, on the other hand, prescribes only after ten
(10) years from 1990 and 1991 when the free patents and the certificates of title over Lot 1017 and
Lot 1015, respectively, were registered. Obviously the action had not prescribed when private
respondents filed their complaint against petitioners on 19 December 1995. At any rate, the action
for reconveyance in the case at bar is also significantly deemed to be an action to quiet title for
purposes of determining the prescriptive period on account of private respondents’ allegations of
actual possession of the disputed lots.23 In such a case, the cause of action is truly
imprescriptible.24
Third. We agree with the Court of Appeals that private respondents did not altogether dispense
with the certificate of non-forum shopping. What is involved here is a certification several
sentences short of the standard form as it only states: "That we have not filed any case in any court
or bodies affecting the same subject matter." While this manner of formulating the certification is
indeed deplorable, its presence in the complaint nonetheless shows the intention of private
respondents to comply with the standard form. Verily, we can only presume innocent reasons - as
there is no reason for pursuing a contrary belief - for the omissions of the other standard
statements therein. In Cabardo v. Court of Appeals25 where the certificate of non-forum shopping
was found deficient in details we ruled -
x x x petitioner’s failure to state in the certificate of non-forum shopping that he undertakes to

inform the Court of any petition which might be filed, as required under Revised Circular No. 28-91,
may be overlooked since it does not appear that any petition related to this case has ever been
filed in any other court. On the other hand, to dismiss the petition on this ground would be to
uphold technicality over substantial justice.
For the same reason that no case related to the complaint filed by private respondents has been
filed by them in any other court, we rule pro hac vice that the contested certificate of non-forum
shopping is substantial compliance with the rules. Indeed to hold otherwise would only further
delay the disposition of the original dispute between petitioners and private respondents
concerning the ownership of Lot 1015 and Lot 1017. We note that their conflicting claims could
have been resolved by now if not for the erroneous application of the elementary rules of pleading
which resulted in the premature dismissal of the complaint filed by private respondents.1âwphi1
This Court need not repeat the fastidious and unfounded adherence to technicality which already
stalled for an unfortunate seven (7) years more or less the proceedings in the trial court.
In sum, the grounds relied upon in petitioners’ desire to dismiss the complaint of private
respondents in Civil Case No. 95-312 cannot be impressed with merit. By this decision, however, we
are not foreclosing the presentation of evidence during trial on the merits that Lot 1015 and Lot
1017 are not private property and that private respondents are not truly the owners thereof. This
and other issues on the merits must follow where the preponderant evidence lies.
WHEREFORE, the instant Petition for Review is DENIED for lack of merit. The Decision of the Court
of Appeals dated 15 February 2000 reversing the Order dismissing the Complaint in Civil Case No.
95-312 entitled Heirs of Honorio Dacut, namely, Visaminda Orevillo, Violeta Dacut, Josephine Dacut
and Elizabeth Dacut v. Heirs of Ambrocio Kionisala, namely, Ana, Isabel, Grace, Ophelia, Joven and
Camilo, all surnamed Kionisala, and Isabel Kionisala is AFFIRMED with the understanding that
private respondents Heirs of Honorio Dacut as plaintiffs therein may proceed on the basis of their
causes of action of declaration of nullity of free patents and certificates of titles and/or
reconveyance based on an implied trust, with claim for damages. The proceedings in the trial court
shall commence forthwith within thirty (30) days from notice of the finality of this Decision without
unnecessary delay.
SO ORDERED.
G.R. No. 168661 October 26, 2007
ESTATE OF THE LATE JESUS S. YUJUICO, represented by ADMINISTRATORS BENEDICTO V. YUJUICO

and EDILBERTO V. YUJUICO; and AUGUSTO Y. CARPIO, Petitioners,
vs.
REPUBLIC OF THE PHILIPPINES and the COURT OF APPEALS, Respondents.
DECISION
VELASCO, JR., J.:
In 1973, Fermina Castro filed an application for the registration and confirmation of her title over a
parcel of land with an area of 17,343 square meters covered by plan (LRC) Psu-964 located in the
Municipality of Parañaque, Province of Rizal (now Parañaque City), in the Pasig-Rizal Court of First
Instance (CFI), Branch 22. The application was docketed LRC Case No. N-8239. The application was
opposed by the Office of the Solicitor General (OSG) on behalf of the Director of Lands, and by
Mercedes Dizon, a private party. Both oppositions were stricken from the records since the
opposition of Dizon was filed after the expiration of the period given by the court, and the
opposition of the Director of Lands was filed after the entry of the order of general default. After
considering the evidence, the trial court rendered its April 26, 1974 Decision. The dispositive
portion reads:
____________________________
* As per September 3, 2007 raffle.
WHEREFORE, the Court hereby declares the applicant, Fermina Castro, of legal age, single, Filipino
and a resident of 1515 F. Agoncillo St., Corner J. Escoda St., Ermita, Manila, the true and absolute
owner of the land applied for situated in the Municipality of Parañaque, Province of Rizal, with an
area of 17,343 square meters and covered by plan (LRC) Psu-964 and orders the registration of said
parcel of land in her name with her aforementioned personal circumstances.
Once this decision becomes final and executory, let the corresponding order for the issuance of the
decree be issued.
SO ORDERED.1
The Director of Lands and Mercedes Dizon did not appeal from the adverse decision of the Pasig-
Rizal CFI. Thus, the order for the issuance of a decree of registration became final, and Decree No.
N-150912 was issued by the Land Registration Commission (LRC).2 Original Certificate of Title (OCT)
No. 10215 was issued in the name of Fermina Castro by the Register of Deeds for the Province of
Rizal on May 29, 1974.3
The land was then sold to Jesus S. Yujuico, and OCT No. 10215 was cancelled. On May 31, 1974,4
Transfer Certificate of Title (TCT) No. 445863 was issued in Yujuico’s name, who subdivided the land
into two lots. TCT No. 4463865 over Lot 1 was issued in his name, while TCT No. S-293616 over Lot
2 was issued in the name of petitioner Augusto Y. Carpio.
Annotations at the back of TCT No. 446386 show that Yujuico had, at one time or another,
mortgaged the lot to the Philippine Investments System Organization (PISO) and Citibank, N.A.
Annotations in the title of petitioner Carpio reveal the lot was mortgaged in favor of Private
Development Corporation (PDC), Rizal Commercial Banking Corporation (RCBC) and then Philippine
Commercial and Industrial Bank (PCIB) and the Development Bank of the Philippines (DBP) to
secure various loans.
Sometime in 1977, Presidential Decree No. (PD) 1085 entitled Conveying the Land Reclaimed in the
Foreshore and Offshore of the Manila Bay (The Manila-Cavite Coastal Road Project) as Property of
the Public Estates Authority as well as Rights and Interests with Assumptions of Obligations in the
Reclamation Contract Covering Areas of the Manila Bay between the Republic of the Philippines
and the Construction and Development Corporation of the Philippines (1977) was issued. Land
reclaimed in the foreshore and offshore areas of Manila Bay became the properties of the Public
Estates Authority (PEA), a government corporation that undertook the reclamation of lands or the
acquisition of reclaimed lands. On January 13, 1989, OCT No. SP 02 was issued in favor of PEA. The
PEA also acquired ownership of other parcels of land along the Manila Bay coast, some of which
were subsequently sold to the Manila Bay Development Corporation (MBDC), which in turn leased
portions to Uniwide Holdings, Inc.7
The PEA undertook the construction of the Manila Coastal Road. As this was being planned, Yujuico
and Carpio discovered that a verification survey they commissioned showed that the road directly
overlapped their property, and that they owned a portion of the land sold by the PEA to the MBDC.
On July 24, 1996, Yujuico and Carpio filed before the Parañaque City Regional Trial Court (RTC), a
complaint for the Removal of Cloud and Annulment of Title with Damages docketed as Civil Case
No. 96-0317 against the PEA. On May 15, 1998 the parties entered into a compromise agreement
approved by the trial court in a Resolution dated May 18, 1998. On June 17, 1998, the parties
executed a Deed of Exchange of Real Property, pursuant to the compromise agreement, where the
PEA property with an area of 1.4007 hectares would be conveyed to Jesus Yujuico and petitioner
Carpio in exchange for their property with a combined area of 1.7343 hectares.
On July 31, 1998, the incumbent PEA General Manager, Carlos P. Doble, informed the OSG that the
new PEA board and management had reviewed the compromise agreement and had decided to
defer its implementation and hold it in abeyance following the view of the former PEA General
Manager, Atty. Arsenio Yulo, Jr., that the compromise agreement did not reflect a condition of the
previous PEA Board, requiring the approval of the Office of the President. The new PEA
management then filed a petition for relief from the resolution approving the compromise
agreement on the ground of mistake and excusable negligence.
The petition was dismissed by the trial court on the ground that it was filed out of time and that the
allegation of mistake and excusable negligence lacked basis.
The PEA fared no better in the Court of Appeals (CA), as the petition was dismissed for failure to
pay the required docket fees and for lack of merit.
The matter was raised to the Supreme Court in Public Estates Authority v. Yujuico8 but PEA’s
petition was denied, upholding the trial court’s dismissal of the petition for relief for having been
filed out of time. The allegation of fraud in the titling of the subject property in the name of
Fermina Castro was not taken up by the Court.
On June 8, 2001, in a Complaint for Annulment and Cancellation of Decree No. N-150912 and its
Derivative Titles, entitled Republic of the Philippines v. Fermina Castro, Jesus S. Yujuico, August Y.
Carpio and the Registry of Deeds of Parañaque City docketed as Civil Case No. 01-0222, filed with
the Parañaque City RTC, respondent Republic of the Philippines, through the OSG, alleged that
when the land registered to Castro was surveyed by Engr. H. Obreto on August 3, 1972 and
subsequently approved by the LRC on April 23, 1973, the land was still a portion of Manila Bay as
evidenced by Namria Hydrographic Map No. 4243, Surveys to 1980; 1st Ed/. January 9/61: Revised
80-11-2; that Roman Mataverde, the then OIC of the Surveys Division, Bureau of Lands, informed
the OIC of the Legal Division that "[w]hen projected on Cadastral Maps CM 14 deg. 13’ N-120 deg,
59’E, Sec.2-A of Parañaque Cadastre (Cad. 299), (LRC) Psu-964 falls inside Manila Bay, outside Cad.
299"; that then Acting Regional Lands Director Narciso V. Villapando issued a Report dated
November 15, 1973 stating that plan (LRC) Psu-964 is a portion of Manila Bay; that then Officer-in-
Charge, Assistant Director of Lands, Ernesto C. Mendiola, submitted his Comment and
Recommendation re: Application for Registration of Title of FERMINA CASTRO, LRC Case No. N-
8239, dated Dec. 1, 1977, praying that the instant registration case be dismissed; and that Fermina
Castro had no registrable rights over the property.
More significantly, respondent Republic argued that, first, since the subject land was still
underwater, it could not be registered in the name of Fermina Castro. Second, the land registration
court did not have jurisdiction to adjudicate inalienable lands, thus the decision adjudicating the
subject parcel of land to Fermina Castro was void. And third, the titles of Yujuico and Carpio, being
derived from a void title, were likewise void.9
On September 13, 2001, Yujuico and Carpio filed a Motion to Dismiss (With Cancellation of Notice
of Lis Pendens),10 on the grounds that: (1) the cause of action was barred by prior judgment; (2)
the claim had been waived, abandoned, or otherwise extinguished; (3) a condition precedent for
the filing of the complaint was not complied with; and (4) the complaint was not verified and the
certification against forum shopping was not duly executed by the plaintiff or principal party.
On November 27, 2001, respondent Republic filed an Opposition11 to the motion to dismiss to
which defendants filed a Reply12 on January 14, 2002, reiterating the grounds for the motion to
dismiss.
In the August 7, 2002 Order of the RTC,13 Civil Case No. 01-0222 was dismissed. The trial court
stated that the matter had already been decided in LRC Case No. N-8239, and that after 28 years
without being contested, the case had already become final and executory.1âwphi1 The trial court
also found that the OSG had participated in the LRC case, and could have questioned the validity of
the decision but did not. Civil Case No. 01-0222 was thus found barred by prior judgment.
On appeal to the CA, in CA-G.R. CV No. 76212, respondent Republic alleged that the trial court
erred in disregarding that appellant had evidence to prove that the subject parcel of land used to
be foreshore land of the Manila Bay and that the trial court erred in dismissing Civil Case No. 01-
0222 on the ground of res judicata.14
The CA observed that shores are properties of the public domain intended for public use and,
therefore, not registrable and their inclusion in a certificate of title does not convert the same into
properties of private ownership or confer title upon the registrant.
Further, according to the appellate court res judicata does not apply to lands of public domain, nor
does possession of the land automatically divest the land of its public character.
The appellate court explained that rulings of the Supreme Court have made exceptions in cases
where the findings of the Director of Lands and the Department of Environment and Natural
Resources (DENR) were conflicting as to the true nature of the land in as much as reversion efforts
pertaining foreshore lands are embued with public interest.
The dispositive portion of the CA decision reads,
WHEREFORE, premises considered, the present appeal is hereby GRANTED. The appealed Order
dated August 7, 2002 of the trial court in Civil Case No. 01-0222 is hereby REVERSED and SET ASIDE.
The case is hereby REMANDED to said court for further proceedings and a full-blown trial on the
merits with utmost dispatch.15
Hence, this petition.
The Issues
Petitioners now raise the following issues before this Court:
THE COURT OF APPEALS COMMITTED REVERSIBLE ERROR AND DECIDED A QUESTION OF

SUBSTANCE IN A WAY NOT IN ACCORDANCE WITH LAW AND THE APPLICABLE DECISIONS OF THE
HONORABLE COURT AND HAS DEPARTED FROM THE ACCEPTED AND USUAL COURSE OF JUDICIAL
PROCEEDINGS NECESSITATING THE HONORABLE COURT’S EXERCISE OF ITS POWER OF
SUPERVISION CONSIDERING THAT:
I. THE REVERSAL BY THE COURT OF APPEALS OF THE TRIAL COURT’S APPLICATION OF THE
PRINCIPLE OF RES JUDICATA IN THE INSTANT CASE IS BASED ON ITS ERRONEOUS ASSUMPTION
THAT THE SUBJECT LAND IS OF PUBLIC DOMAIN, ALLEGEDLY PART OF MANILA BAY.
A. IN THE FIRESTONE CASE, THE HONORABLE COURT APPLIED THE PRINCIPLE OF RES JUDICATA
NOTWITHSTANDING ALLEGATIONS OF LACK OF JURISDICTION OF A LAND REGISTRATION COURT,
FORECLOSING ANY FURTHER ATTEMPT BY RESPONDENT THEREIN, AS IN THE INSTANT CASE, TO
RESURRECT A LONG-SETTLED JUDICIAL DETERMINATION OF REGISTRABILITY OF A PARCEL OF LAND
BASED ON THE SHEER ALLEGATION THAT THE SAME IS PART OF THE PUBLIC DOMAIN.
B. THE LAND REGISTRATION COURT HAD JURISDICTION TO DETERMINE WHETHER THE SUBJECT
LAND WAS PART OF THE PUBLIC DOMAIN.
C. RESPONDENT’S REVERSION CASE SEEKS TO RETRY THE VERY SAME FACTUAL ISSUES THAT HAVE
ALREADY BEEN JUDICIALLY DETERMINED OVER THIRTY (30) YEARS AGO.
D. THE JURISPRUDENTIAL BASES APPLIED BY THE COURT OF APPEALS IN ITS QUESTIONED DECISION
ARE MISPLACED, CONSIDERING THAT THEY ARE ALL PREDICATED ON THE ERRONEOUS PREMISE
THAT IT IS UNDISPUTED THAT THE SUBJECT LAND IS PART OF THE PUBLIC DOMAIN.
II. RESPONDENT IS BARRED BY JURISDICTIONAL ESTOPPEL AND LACHES FROM QUESTIONING THE
JURISDICTION OF THE LAND REGISTRATION COURT.
III. RELIANCE BY THE COURT OF APPEALS ON THE ISOLATED PRONOUNCEMENT OF THE

HONORABLE COURT IN THE PEA CASE IS UNWARRANTED AND MISLEADING CONSIDERING THAT
THE MATTER OF WHETHER RES JUDICATA APPLIES WITH RESPECT TO THE LAND REGISTRATION
COURT’S DECISION IN 1974 WAS NOT IN ISSUE IN SAID CASE.
A. THE INSTANT REVERSION CASE IS NOT THE PROPER RECOURSE.
B. THE VALIDITY OF THE COURT-APPROVED COMPROMISE AGREEMENT 15 MAY 1998 HAS ALREADY
BEEN AFFIRMED BY THE HONORABLE COURT IN THE PEA CASE.
IV. EQUITABLE CONSIDERATIONS MANDATE THE APPLICATION OF THE RULE ON ORDINARY

ESTOPPEL AND LACHES IN THE INSTANT CASE AGAINST RESPONDENT.
V. RESPONDENT CANNOT BE GIVEN SPECIAL CONSIDERATION AND EXCUSED FOR TRANSGRESSING

RULES OF PROCEDURE.16
Essentially, the issues boil down to three: (1) Is a reversion suit proper in this case? (2) Is the
present petition estopped by laches? (3) Did the CA erroneously apply the principle of res judicata?
An action for reversion seeks to restore public land fraudulently awarded and disposed of to private
individuals or corporations to the mass of public domain.17 This remedy is provided under
Commonwealth Act (CA) No. 141 (Public Land Act) which became effective on December 1, 1936.
Said law recognized the power of the state to recover lands of public domain. Section 124 of CA No.
141 reads:
SEC. 124. Any acquisition, conveyance, alienation, transfer, or other contract made or executed in
violation of any of the provisions of Sections one hundred and eighteen, one hundred and twenty,
one hundred and twenty one, one hundred and twenty-two, and one hundred twenty-three of this
Act shall be unlawful and null and void from its execution and shall produce the effect of annulling
and cancelling the grant, title, patent, or permit originally issued, recognized or confirmed, actually
or presumptively, and cause the reversion of the property and its improvements to the State.
(Emphasis supplied.)
Pursuant to Section 124 of the Public Land Act, reversion suits are proper in the following instances,
to wit:
1. Alienations of land acquired under free patent or homestead provisions in violation of Section
118, CA No. 141;
2. Conveyances made by non-Christians in violation of Section 120, CA No. 141; and

3. Alienations of lands acquired under CA No. 141 in favor of persons not qualified under Sections
121, 122, and 123 of CA No. 141.
From the foregoing, an action for reversion to cancel titles derived from homestead patents or free
patents based on transfers and conveyances in violation of CA No. 141 is filed by the OSG pursuant
to its authority under the Administrative Code with the RTC. It is clear therefore that reversion suits
were originally utilized to annul titles or patents administratively issued by the Director of the Land
Management Bureau or the Secretary of the DENR.
While CA No. 141 did not specify whether judicial confirmation of titles by a land registration court
can be subject of a reversion suit, the government availed of such remedy by filing actions with the
RTC to cancel titles and decrees granted in land registration applications.
The situation changed on August 14, 1981 upon effectivity of Batas Pambansa (BP) Blg. 129 which
gave the Intermediate Appellate Court the exclusive original jurisdiction over actions for annulment
of judgments of RTCs.
When the 1997 Rules of Civil Procedure became effective on July 1, 1997, it incorporated Rule 47
on annulment of judgments or final orders and resolutions of the RTCs. The two grounds for
annulment under Sec. 2, Rule 47 are extrinsic fraud and lack of jurisdiction. If based on extrinsic
fraud, the action must be filed within four (4) years from its discovery, and if based on lack of
jurisdiction, before it is barred by laches or estoppel as provided by Section 3, Rule 47. Thus,
effective July 1, 1997, any action for reversion of public land instituted by the Government was
already covered by Rule 47.
The instant Civil Case No. 01-0222 for annulment and cancellation of Decree No. N-150912 and its
derivative titles was filed on June 8, 2001 with the Parañaque City RTC. It is clear therefore that the
reversion suit was erroneously instituted in the Parañaque RTC and should have been dismissed for
lack of jurisdiction. The proper court is the CA which is the body mandated by BP Blg. 129 and
prescribed by Rule 47 to handle annulment of judgments of RTCs.
In Collado v. Court of Appeals,18 the government, represented by the Solicitor General pursuant to
Section 9(2) of BP Blg. 129, filed a petition for annulment of judgment with the CA. Similarly in the
case of Republic v. Court of Appeals,19 the Solicitor General correctly filed the annulment of
judgment with the said appellate court.
This was not done in this case. The Republic misfiled the reversion suit with the Parañaque RTC. It
should have been filed with the CA as required by Rule 47. Evidently, the Parañaque RTC had no
jurisdiction over the instant reversion case.
Assuming that the Parañaque RTC has jurisdiction over the reversion case, still the lapse of almost
three decades in filing the instant case, the inexplicable lack of action of the Republic and the injury
this would cause constrain us to rule for petitioners. While it may be true that estoppel does not
operate against the state or its agents,20 deviations have been allowed. In Manila Lodge No. 761 v.
Court of Appeals, we said:
Estoppels against the public are little favored. They should not be invoked except in rare and
unusual circumstances, and may not be invoked where they would operate to defeat the effective
operation of a policy adopted to protect the public. They must be applied with circumspection and
should be applied only in those special cases where the interests of justice clearly require it.
Nevertheless, the government must not be allowed to deal dishonorably or capriciously with its
citizens, and must not play an ignoble part or do a shabby thing; and subject to limitations x x x, the
doctrine of equitable estoppel may be invoked against public authorities as well as against private
individuals.21 (Emphasis supplied.)
Equitable estoppel may be invoked against public authorities when as in this case, the lot was
already alienated to innocent buyers for value and the government did not undertake any act to
contest the title for an unreasonable length of time.
In Republic v. Court of Appeals, where the title of an innocent purchaser for value who relied on the
clean certificates of the title was sought to be cancelled and the excess land to be reverted to the
Government, we ruled that "[i]t is only fair and reasonable to apply the equitable principle of
estoppel by laches against the government to avoid an injustice to innocent purchasers for value
(emphasis supplied)."22 We explained:
Likewise time-settled is the doctrine that where innocent third persons, relying on the correctness
of the certificate of title, acquire rights over the property, courts cannot disregard such rights and
order the cancellation of the certificate. Such cancellation would impair public confidence in the
certificate of title, for everyone dealing with property registered under the Torrens system would
have to inquire in every instance whether the title has been regularly issued or not. This would be
contrary to the very purpose of the law, which is to stabilize land titles. Verily, all persons dealing
with registered land may safely rely on the correctness of the certificate of title issued therefore,
and the law or the courts do not oblige them to go behind the certificate in order to investigate
again the true condition of the property. They are only charged with notice of the liens and
encumbrances on the property that are noted on the certificate.23
xxxx
But in the interest of justice and equity, neither may the titleholder be made to bear the
unfavorable effect of the mistake or negligence of the State’s agents, in the absence of proof of his
complicity in a fraud or of manifest damage to third persons. First, the real purpose of the Torrens
system is to quiet title to land to put a stop forever to any question as to the legality of the title,
except claims that were noted in the certificate at the time of the registration or that may arise
subsequent thereto. Second, as we discussed earlier, estoppel by laches now bars petitioner from
questioning private respondents’ titles to the subdivision lots. Third, it was never proven that
Private Respondent St. Jude was a party to the fraud that led to the increase in the area of the
property after its subdivision. Finally, because petitioner even failed to give sufficient proof of any
error that might have been committed by its agents who had surveyed the property, the
presumption of regularity in the performance of their functions must be respected. Otherwise, the
integrity of the Torrens system, which petitioner purportedly aims to protect by filing this case,
shall forever be sullied by the ineptitude and inefficiency of land registration officials, who are
ordinarily presumed to have regularly performed their duties.24
Republic v. Court of Appeals is reinforced by our ruling in Republic v. Umali,25 where, in a reversion
case, we held that even if the original grantee of a patent and title has obtained the same through
fraud, reversion will no longer prosper as the land had become private land and the fraudulent
acquisition cannot affect the titles of innocent purchasers for value.
Considering that innocent purchaser for value Yujuico bought the lot in 1974, and more than 27
years had elapsed before the action for reversion was filed, then said action is now barred by
laches.
While the general rule is that an action to recover lands of public domain is imprescriptible, said
right can be barred by laches or estoppel. Section 32 of PD 1592 recognized the rights of an
innocent purchaser for value over and above the interests of the government. Section 32 provides:
SEC. 32. Review of decree of registration; Innocent purchaser for value.—The decree of registration
shall not be reopened or revised by reason of absence, minority, or other disability of any person
adversely affected thereby, nor by any proceeding in any court for reversing judgments, subject,
however, to the right of any person, including the government and the branches thereof, deprived
of land or of any estate or interest therein by such adjudication or confirmation of title obtained by
actual fraud, to file in the proper Court of First Instance a petition for reopening and review of the
decree of registration not later than one year from and after the date of the entry of such decree of
registration, but in no case shall such petition be entertained by the court where an innocent
purchaser for value has acquired the land or an interest therein, whose rights may be prejudiced.
Whenever the phrase "innocent purchaser for value" or an equivalent phrase occurs in this Decree,
it shall be deemed to include an innocent lessee, mortgagee, or other encumbrances for value.
(Emphasis supplied.)
In this petition, the LRC (now LRA), on May 30, 1974, issued Decree No. N-150912 in favor of
Fermina Castro and OCT No. 10215 was issued by the Rizal Registrar of Deeds on May 29, 1974.
OCT No. 10215 does not show any annotation, lien, or encumbrance on its face. Relying on the
clean title, Yujuico bought the same in good faith and for value from her. He was issued TCT No.
445863 on May 31, 1974. There is no allegation that Yujuico was a buyer in bad faith, nor did he
acquire the land fraudulently. He thus had the protection of the Torrens System that every
subsequent purchaser of registered land taking a certificate of title for value and in good faith shall
hold the same free from all encumbrances except those noted on the certificate and any of the x x x
encumbrances which may be subsisting.26 The same legal shield redounds to his successors-in-
interest, the Yujuicos and Carpio, more particularly the latter since Carpio bought the lot from Jesus
Y. Yujuico for value and in good faith.
Likewise protected are the rights of innocent mortgagees for value, the PISO, Citibank, N.A., PDC,
RCBC, PCIB, and DBP. Even if the mortgagor’s title was proved fraudulent and the title declared null
and void, such declaration cannot nullify the mortgage rights of a mortgagee in good faith.27
All told, a reversion suit will no longer be allowed at this stage.
More on the issue of laches. Laches is the failure or neglect, for an unreasonable and unexplained
length of time, to do that which by exercising due diligence could or should have been done earlier.
It is negligence or omission to assert a right within a reasonable time, warranting a presumption

that the party entitled thereto has either abandoned or declined to assert it.28
When respondent government filed the reversion case in 2001, 27 years had already elapsed from
the time the late Jesus Yujuico purchased the land from the original owner Castro. After the
issuance of OCT No. 10215 to Castro, no further action was taken by the government to question
the issuance of the title to Castro until the case of Public Estates Authority, brought up in the oral
argument before this Court on September 6, 2000.29 We then held that allegation of fraud in the
issuance of the title was not proper for consideration and determination at that stage of the case.
From the undisputed facts of the case, it is easily revealed that respondent Republic took its sweet
time to nullify Castro’s title, notwithstanding the easy access to ample remedies which were readily
available after OCT No. 10215 was registered in the name of Castro. First, it could have appealed to
the CA when the Pasig-Rizal CFI rendered a decision ordering the registration of title in the name of
applicant Castro on April 26, 1974. Had it done so, it could have elevated the matter to this Court if
the appellate court affirms the decision of the land registration court. Second, when the entry of
Decree No. N-150912 was made on May 29, 1974 by the Rizal Register of Deeds, the Republic had
one (1) year from said date or up to May 28, 1975 to file a petition for the reopening and review of
Decree No. N-150912 with the Rizal CFI (now RTC) on the ground of actual fraud under section 32 of
PD 1592. Again, respondent Republic did not avail of such remedy. Third, when Jesus Yujuico filed a
complaint for Removal of Cloud and Annulment of Title with Damages against PEA before the
Parañaque RTC in Civil Case No. 96-0317, respondent could have persevered to question and nullify
Castro’s title. Instead, PEA undertook a compromise agreement on which the May 18, 1998
Resolution30 was issued. PEA in effect admitted that the disputed land was owned by the
predecessors-in-interest of petitioners and their title legal and valid; and impliedly waived its right
to contest the validity of said title; respondent Republic even filed the petition for relief from
judgment beyond the time frames allowed by the rules, a fact even acknowledged by this Court in
Public Estates Authority. Lastly, respondent only filed the reversion suit on June 8, 2001 after the
passage of 27 years from the date the decree of registration was issued to Fermina Castro.
Such a Rip Van Winkle, coupled with the signing of the settlement with PEA, understandably misled
petitioners to believe that the government no longer had any right or interest in the disputed lot to
the extent that the two lots were even mortgaged to several banks including a government
financing institution. Any nullification of title at this stage would unsettle and prejudice the rights
and obligations of innocent parties. All told, we are constrained to conclude that laches had set in.
Even granting arguendo that respondent Republic is not precluded by laches from challenging the
title of petitioners in the case at bar, still we find that the instant action for reversion is already
barred by res judicata.
Petitioners relying on Firestone Ceramics, Inc. v. Court of Appeals31 as a precedent to the case at
bar contend that the instant reversion suit is now barred by res judicata.
We agree with petitioners.
The doctrine on precedents is expressed in the latin maxim—Stare decisis et non quieta movere.
Follow past precedents and do not disturb what has been settled.32 In order however that a case
can be considered as a precedent to another case which is pending consideration, the facts of the
first case should be similar or analogous to the second case.
A perusal of the facts of the Firestone case and those of the case at bar reveals that the facts in the
two (2) cases are parallel. First, in Firestone and in this case, the claimants filed land registration
applications with the CFI; both claimants obtained decrees for registration of lots applied for and
were issued OCTs. Second, in Firestone, the Republic filed a reversion case alleging that the land
covered by the OCT was still inalienable forest land at the time of the application and hence the
Land Registration Court did not acquire jurisdiction to adjudicate the property to the claimant. In
the instant case, respondent Republic contend that the land applied for by Yujuico was within
Manila Bay at the time of application and therefore the CFI had no jurisdiction over the subject
matter of the complaint. Third, in Firestone, the validity of the title of the claimant was favorably
ruled upon by this Court in G.R. No. 109490 entitled Patrocinio E. Margolles v. CA. In the case at
bar, the validity of the compromise agreement involving the disputed lot was in effect upheld when
this Court in Public Estates Authority v. Yujuico dismissed the petition of PEA seeking to reinstate
the petition for relief from the May 18, 1998 Resolution approving said compromise agreement.
With the dismissal of the petition, the May 18, 1998 Resolution became final and executory and
herein respondent Republic through PEA was deemed to have recognized Castro’s title over the
disputed land as legal and valid. In Romero v. Tan,33 we ruled that "a judicial compromise has the
effect of res judicata." We also made clear that a judgment based on a compromise agreement is a
judgment on the merits, wherein the parties have validly entered into stipulations and the evidence
was duly considered by the trial court that approved the agreement. In the instant case, the May
18, 1998 Resolution approving the compromise agreement confirmed the favorable decision
directing the registration of the lot to Castro’s name in LRC Case No. N-8239. Similarly, in Firestone,
the Margolles case confirmed the decision rendered in favor of Gana in Land Registration Case No.
672 ordering the issuance of the decree to said applicant. Fourth, in Firestone, the Supreme Court
relied on the letter of then Solicitor General Francisco Chavez that the evidence of the Bureau of
Lands and the LRC was not sufficient to support an action for cancellation of OCT No. 4216. In the
instant case, both the Solicitor General and the Government Corporate Counsel opined that the
Yujuico land was not under water and that "there appears to be no sufficient basis for the
Government to institute the action for annulment." Fifth, in Firestone, we ruled that "the Margolles
case had long become final, thus the validity of OCT No. 4216 should no longer be disturbed and
should be applied in the instant case (reversion suit) based on the principle of res judicata or,
otherwise, the rule on conclusiveness of judgment."34
Clearly from the above, Firestone is a precedent case. The Public Estates Authority had become
final and thus the validity of OCT No. 10215 issued to Castro could no longer be questioned.
While we said in Public Estates Authority that the court does not foreclose the right of the Republic
from pursuing the proper recourse in a separate proceedings as it may deem warranted, the
statement was obiter dictum since the inquiry on whether or not the disputed land was still under
water at the time of its registration was a non-issue in the said case.
Even granting for the sake of argument that Firestone is not squarely applicable, still we find the
reversion suit already barred by res judicata.
For res judicata to serve as an absolute bar to a subsequent action, the following requisites must
concur: (1) there must be a final judgment or order; (2) the court rendering it must have jurisdiction
over the subject matter and the parties; (3) it must be a judgment or order on the merits; and (4)
there must be between the two cases, identity of parties, subject matter and causes of action.35
There is no question as to the first, third and last requisites. The threshold question pertains to the
second requisite, whether or not the then Pasig-Rizal CFI, Branch 22 had jurisdiction over the
subject matter in LRC Case No. N-8239. In Civil Case No. 01-0222, the Parañaque City RTC, Branch
257 held that the CFI had jurisdiction. The CA reversed the decision of the Parañaque City RTC
based on the assertion of respondent Republic that the Pasig-Rizal CFI had no jurisdiction over the
subject matter, and that there was a need to determine the character of the land in question.
The Parañaque City RTC Order dismissing the case for res judicata must be upheld.
The CA, in rejecting the dismissal of the reversion case by the Parañaque RTC, relied on two cases,
namely: Municipality of Antipolo v. Zapanta36 and Republic v. Vda. De Castillo.37
In Municipality of Antipolo, we held that the land registration court had no jurisdiction to entertain
any land registration application if the land was public property, thus:
Since the Land Registration Court had no jurisdiction to entertain the application for registration of
public property of ANTIPOLO, its Decision adjudicating the DISPUTED PROPERTY as of private
ownership is null and void. It never attained finality, and can be attacked at any time. It was not a
bar to the action brought by ANTIPOLO for its annulment by reason of res judicata.
"[x x x] the want of jurisdiction by a court over the subject matter renders the judgment void and a
mere nullity, and considering that a void judgment is in legal effect no judgment, by which no rights
are divested, from which no rights can be obtained, which neither binds nor bars any one, and
under which all acts performed and all claims flowing out of are void, and considering, further, that
the decision, for want of jurisdiction of the court, is not a decision in contemplation of law, and
hence, can never become executory, it follows that such a void judgment cannot constitute a bar to
another case by reason of res judicata."
xxxx
"It follows that ‘if a person obtains a title under the Public Land Act which includes, by oversight,
lands which cannot be registered under the Torrens System, or when the Director of Lands did not
have jurisdiction over the same because it is a public forest, the grantee does not, by virtue of the
said certificate of title alone, become the owner of the land illegally included’ (Republic vs. Animas,
56 SCRA 499, 503; Ledesma vs. Municipality of Iloilo, 49 Phil. 769)."
[x x x x]
"Under these circumstances, the certificate of title may be ordered cancelled (Republic vs. Animas,
et al., supra), and the cancellation maybe pursued through an ordinary action therefore. This action
cannot be barred by the prior judgment of the land registration court, since the said court had no
jurisdiction over the subject matter. And if there was no such jurisdiction, then the principle of res
judicata does not apply. [x x x] Certainly, one of the essential requisites, i.e., jurisdiction over the
subject matter, is absent in this case." (Italics supplied).38
The plain import of Municipality of Antipolo is that a land registration court, the RTC at present, has
no jurisdiction over the subject matter of the application which respondent Republic claims is public
land. This ruling needs elucidation.
Firmly entrenched is the principle that jurisdiction over the subject matter is conferred by law.39
Consequently, the proper CFI (now the RTC) under Section 14 of PD 152940 (Property Registration
Decree) has jurisdiction over applications for registration of title to land.
Section 14 of PD 1592 provides:
SEC. 14. Who may apply.—The following persons may file in the proper Court of First Instance an
application for registration of title to land, whether personally or through their duly authorized
representatives:
(1) Those who by themselves or through their predecessors-in-interest have been in open,
continuous, exclusive and notorious possession and occupation of alienable and disposable lands of
the public domain under a bona fide claim of ownership since June 12, 1945, or earlier. (Emphasis
supplied.)
Conformably, the Pasig-Rizal CFI, Branch XXII has jurisdiction over the subject matter of the land
registration case filed by Fermina Castro, petitioners’ predecessor-in-interest, since jurisdiction over
the subject matter is determined by the allegations of the initiatory pleading¾the application.41
Settled is the rule that "the authority to decide a case and not the decision rendered therein is what
makes up jurisdiction. When there is jurisdiction, the decision of all questions arising in the case is
but an exercise of jurisdiction."42
In our view, it was imprecise to state in Municipality of Antipolo that the "Land Registration Court
[has] no jurisdiction to entertain the application for registration of public property x x x" for such
court precisely has the jurisdiction to entertain land registration applications since that is conferred
by PD 1529. The applicant in a land registration case usually claims the land subject matter of the
application as his/her private property, as in the case of the application of Castro. Thus, the
conclusion of the CA that the Pasig-Rizal CFI has no jurisdiction over the subject matter of the
application of Castro has no legal mooring. The land registration court initially has jurisdiction over
the land applied for at the time of the filing of the application. After trial, the court, in the exercise
of its jurisdiction, can determine whether the title to the land applied for is registrable and can be
confirmed. In the event that the subject matter of the application turns out to be inalienable public
land, then it has no jurisdiction to order the registration of the land and perforce must dismiss the
application.
Based on our ruling in Antipolo, the threshold question is whether the land covered by the titles of
petitioners is under water and forms part of Manila Bay at the time of the land registration
application in 1974. If the land was within Manila Bay, then res judicata does not apply. Otherwise,
the decision of the land registration court is a bar to the instant reversion suit.
After a scrutiny of the case records and pleadings of the parties in LRC Case No. N-8239 and in the
instant petition, we rule that the land of Fermina Castro is registrable and not part of Manila Bay at
the time of the filing of the land registration application.
The trial court’s Decision in 1974 easily reveals the basis for its conclusion that the subject matter
was a dry land, thus:
On February 1, 1974, the applicant presented her evidence before the Deputy Clerk of this Court
and among the evidence presented by her were certain documents which were marked as Exhibits
D to J, inclusive. The applicant testified in her behalf and substantially declared that: she was 62
years old, single, housekeeper and residing at 1550 J. Escoda, Ermita, Manila; that she was born on
June 3, 1911; that she first came to know of the land applied for which is situated in the
Municipality of Parañaque, province of Rizal, with an area of 17,343 square meters and covered by
plan (LRC) Psu-964 while she was still ten (10) years old or sometime in 1921; that when she first
came to know of the land applied for, the person who was in possession and owner of said land was
her father, Catalino Castro; that during that time her father used to plant on said land various crops
like pechay, mustard, eggplant, etc.; that during that time, her father built a house on said land
which was used by her father and the other members of the family, including the applicant, as their
residential house; that the land applied for was inherited by her father from her grandfather Sergio
Castro; that Catalino Castro continuously possessed and owned the land in question from 1921 up
to the time of his death in 1952; and that during that period of time nobody ever disturbed the
possession and ownership of her father over the said parcel of land; that after the death of her
father in 1952 she left the place and transferred her place of residence but she had also occasions
to visit said land twice or thrice a week and sometimes once a week; that after she left the land in
question in 1952, she still continued possessing said land, through her caretaker Eliseo Salonga;
that her possession over the land in question from the time she inherited it up to the time of the
filing of the application has been continuous, public, adverse against the whole world and in the
concept of an owner; that it was never encumbered, mortgaged, or disposed of by her father
during his lifetime and neither did she ever encumber or sell the same; that it was declared for
taxation purposes by her father when he was still alive and her father also paid the real estate taxes
due to the government although the receipt evidencing the payment of said real estate taxes for
the property applied for have been lost and could no longer be found inspite of diligent effort
exerted to locate the same.
The other witness presented by the applicant was Emiliano de Leon, who declared that he was 70
years old, married, farmer and residing at San Jose, Baliwag, Bulacan; that he knew Catalino Castro,
the father of the applicant because said Catalino Castro was his neighbor in Tambo, Parañaque,
Rizal, he had a house erected on the land of Catalino Castro; that he was born in 1903 and he first
came to know of the land in question when in 1918 when he was about 18 years old; that the area
of the land owned and possessed by Catalino Castro where he constructed a residential house has
an area of more than one and one-half (1 ½) hectares; that the possession of Catalino Castro over
the land in question was peaceful, continuous, notorious, adverse against the whole world and in
the concept of an owner; that during the time that Catalino Castro was in possession of the land
applied for he planted on said parcel of land mango, coconut and banana, etc.; that Catalino Castro
continuously possessed and owned said parcel of land up to the year 1952 when he died; that
during the time that Catalino Castro was in possession of said land, nobody ever laid claim over the
said property; that said land is not within any military or naval reservation; that upon the death of
Catalino Castro, the applicant took possession of the land applied for and that up to the present the
applicant is in possession of said land; that he resided in the land in question from 1918 up to the
time he transferred his place of residence in Baliwag, Bulacan in the year 1958.
On February 11, 1974, the Court, pursuant to the provision of Presidential Decree No. 230 issued by
his Excellency, Ferdinand E. Marcos dated July 9, 1973 held in abeyance the rendition of a decision
in this case and directed the applicant to submit a white print copy of plan (LRC) Psu-964 to the
Director of lands who was directed by the Court to submit his comment and recommendation
thereon.
The property in question is declared for taxation purposes under Tax Declaration No. 51842 (Exhibit
G) and real estate taxes due thereon have been paid up to the year 1973 (Exhibit H).
In compliance with the Order of this Court February 11, 1974, the Director of Lands, thru Special
Attorney Saturnino A. Pacubas, submitted a report to this Court dated April 25, 1974, stating among
other things, that upon ocular inspection conducted by Land Inspector Adelino G. Gorospe and the
subsequent joint ocular inspection conducted by Geodetic Engineer Manuel A. Cervantes and
Administrative Assistant Lazaro G. Berania, it was established that the parcel of land covered by
plan (LRC) Psu-964 no longer forms part of the Manila Bay but is definitely solid and dry land.
In this connection, it should be noted that Administrative Assistant Lazaro G. Berania and Geodetic
Engineer Manuel A. Cervantes, in their report dated March 22, 1974 have also stated that the land
applied for cannot be reached by water even in the highest tide and that the said land is occupied
by squatter families who have erected makeshift shanties and a basketball court which only prove
that the same is dry and solid land away from the shores of Manila Bay.
Furthermore, Land Inspector Adelino G. Gorospe in his letter-report dated November 28, 1973 has
also stated that there is a house of pre-war vintage owned by the applicant on the land in question
which in effect corroborates the testimony of the applicant and her witness that they have lived on
the land in question even prior to the outbreak of the second world war and that the applicant has
been in possession of the land in question long time ago.43
To counter the evidence of applicant Castro, and bolster its claim that she has no valid title,
respondent Republic relies on the July 18, 1973 Office Memorandum44 of Roman Mataverde, OIC,
Surveys Division, to the OIC, Legal Division, of the Bureau of Lands, stating that "when projected on
cadastral maps CM 14º 13’N - 120º 59’ E., Sec. 3-D and CM 14º 30’N - 120º 59’E., Sec. 2-A of
Paranaque [sic] Cadastre (Cad-299), (LRC) Psu-964 falls inside Manila Bay, outside Cad-299."45
The same conclusion was adopted in a November 15, 1973 letter of Narciso Villapando, Acting
Regional Lands Director to the Chief, Legal Division, Bureau of Lands and in the Comment and
Recommendation of Ernesto C. Mendiola, Assistant Director, also of the Bureau of Lands.
Respondent likewise cites Namria Hydrographic Map No. 4243 Revised 80-11-2 to support its
position that Castro’s lot is a portion of Manila Bay.
The burden of proving these averments falls to the shoulders of respondent Republic. The difficulty
is locating the witnesses of the government. Roman Mataverde, then OIC of the Surveys Division
retired from the government service in 1982. He should by this time be in his 90s. Moreover, Asst.
Regional Director Narciso Villapando and Asst. Director Ernesto C. Mendiola are no longer
connected with the Bureau of Lands since 1986.
Assuming that OIC Roman Mataverde, Asst. Regional Director Narciso Villapando and Assistant
Director Ernesto C. Mendiola are still available as witnesses, the projections made on the cadastral
maps of the then Bureau of Lands cannot prevail over the results of the two ocular inspections by
several Bureau of Lands officials that the disputed lot is definitely "dry and solid land" and not part
of Manila Bay. Special Attorney Saturnino A. Pacubas, Land Inspector Adelino G. Gorospe, Geodetic
Engineer Manuel A. Cervantes and Administrative Asst. Lazaro A. Berana, all officials of the Bureau
of Lands, were positive that the disputed land is solid and dry land and no longer forms part of
Manila Bay. Evidence gathered from the ocular inspection is considered direct and firsthand
information entitled to great weight and credit while the Mataverde and Villapando reports are
evidence weak in probative value, being merely based on theoretical projections "in the cadastral
map or table surveys."46 Said projections must be confirmed by the actual inspection and
verification survey by the land inspectors and geodetic engineers of the Bureau of Lands.
Unfortunately for respondent Republic, the bureau land inspectors attested and affirmed that the
disputed land is already dry land and not within Manila Bay.
On the other hand, the Namria Hydrographic Map No. 4243 does not reveal what portion of Manila
Bay was Castro’s lot located in 1974. Moreover, a hydrographic map is not the best evidence to
show the nature and location of the lot subject of a land registration application. It is derived from a
hydrographic survey which is mainly used for navigation purposes, thus:
Surveys whose principal purpose is the determination of data relating to bodies of water. A
hydrographic survey may consist of the determination of one or several of the following classes of
data: depth water; configuration and nature of the bottom; directions and force of currents; heights
and times of tides and water stages; and location of fixed objects for survey and navigation
purposes.47
Juxtaposed with finding of the ocular inspection by Bureau of Lands Special Attorney Pacubas and
others that Castro’s lot is dry land in 1974, Namria Hydrographic Map No. 4243 is therefore inferior
evidence and lacking in probative force.
Moreover, the reliability and veracity of the July 18, 1973 report of Roman Mataverde based on the
alleged projection on cadastral maps and the Villapando report dated November 15, 1973 are put
to serious doubt in the face of the opinion dated October 13, 1997 of the Government Corporate
Counsel, the lawyer of the PEA, which upheld the validity of the titles of petitioners, thus:
We maintain to agree with the findings of the court that the property of Fermina Castro was
registrable land, as based on the two (2) ocular inspections conducted on March 22, 1974 by Lands
Administrative Assistant Lazaro G. Berania and Lands Geodetic Engr. Manuel Cervantes, finding ‘…
the same no longer forms part of Manila Bay but is definitely solid land which cannot be reached by
water even in the highest of tides’. This Berania-Cervantes report based on ocular inspections
literally overturned the findings and recommendations of Land Director Narciso V. Villapando dated
November 15, 1973, and that of Director Ernesto C. Mendiola dated December 1, 1977, and the
fact that the Villapando-Mendiola reports were merely based on projections in the cadastral map or
table surveys.
xxxx
A. The Legal prognosis of the case is not promising in favor of PEA.
4.1 LRC Case No. N-8239 has already become final and executory and OCT No. 10215 was already
issued in favor of Fermina Castro. Any and all attempts to question its validity can only be
entertained in a quo warranto proceedings (sic), assuming that there are legal grounds (not factual
grounds) to support its nullification. Subjecting it to a collateral attack is not allowed under the
Torrens Title System. In Calalang vs. Register of Deeds of Quezon City, 208 SCRA 215, the Supreme
Court held that the present petition is not the proper remedy in challenging the validity of
certificates of titles since the judicial action required is a direct and not a collateral attack (refer also
to: Toyota Motor Philippine Corporation vs. CA, 216 SCRA 236).
4.2 OCT No. 10215 in favor of Fermina Castro was issued pursuant to a cadastral proceeding, hence
is a rem proceedings which is translated as a constructive notice to the whole world, as held in Adez
Realty Incorporated vs. CA, 212 SCRA 623.
4.3 From the cursory and intent reading of the decision of Judge Sison in LRC Case No. N-8239, we
cannot find any iota of fraud having been committed by the court and the parties. In fact, due
process was observed when the Office of the Solicitor General represented ably the Bureau of
Lands. In Balangcad vs. Justices of the Court of Appeals, 206 SCRA 169, the Supreme Court held that
title to registered property becomes indefeasible after one-year from date of registration except
where there is actual fraud in which case it may be challenged in a direct proceeding within that
period. This is also the ruling in Bishop vs. CA, 208 SCRA 636, that to sustain an action for
annulment of a torrens certificate for being void ab initio, it must be shown that the registration
court had not acquired jurisdiction over the case and there was actual fraud in securing the title.
4.4 As to priority of torrens title, PEA has no defense, assuming that both PEA and Yujuico titles are
valid, as held in Metropolitan Waterworks and Sewerage System vs. CA, 215 SCRA 783, where two
(2) certificates purport to include the same land, the earlier in date prevails.
4.5 The documents so far submitted by the parties to the court indicate that the mother title of the
Yujuico land when registered in 1974 was not underwater. This was shown in the two (2) ocular
inspections conducted by the officials of the Land Bureau.
4.6 The provision of P.D. 239 that no decree of registration may be issued by the court unless upon
approval and recommendation of the Bureau of Lands was substantially complied with in the
Report of Lands Special Attorney Saturnino Pacubas, submitted to the court.48
Even the counsel of respondent Republic, the OSG, arrived at the conclusion that there is no
sufficient legal basis for said respondent to institute action to annul the titles of petitioners, thus:
It may be stated at the outset that a petition for annulment of certificate of title or reconveyance of
land may be based on fraud which attended the issuance of the decree of registration and the
corresponding certificate of title.
Based on the decision in the LRC Case No. N-8239 involving the petition for registration and
confirmation of title filed by Fermina Castro, there is no showing that fraud attended the issuance
of OCT No. 10215. it appears that the evidence presented by Fermina Castro was sufficient for the
trial court to grant her petition.
The testimony of Fermina Castro, which was corroborated by Emiliano de Leon, that she and her
predecessors-in-interest had been in possession of the land for more than thirty (30) years
sufficiently established her vested right over the property initially covered by OCT No. 10215. The
report dated April 25, 1974 which was submitted to the trial court by the Director of Lands through
Special Attorney Saturnino Pacubas showed that the parcel of land was solid and dry land when
Fermina Castro’s application for registration of title was filed. It was based on the ocular inspection
conducted by Land Inspector Adelino Gorospe and the joint circular inspection conducted by
Geodetic Engineer Manuel A. Cervantes and Administrative Assistant Lazaro Berania on November
28, 1973 and March 22, 1974 respectively.
The aforesaid report must be requested unless there is a concrete proof that there was an
irregularity in the issuance thereof. In the absence of evidence to the contrary, the ocular
inspection of the parcel of land, which was made the basis of said report, is presumed to be in
order.
Based on the available records, there appears to be no sufficient basis for the Government to
institute an action for the annulment of OCT No. 10215 and its derivative titles. It is opined that a
petition for cancellation/annulment of Decree No. N-150912 and OCT No. 10215 and all its
derivative titles will not prosper unless there is convincing evidence to negate the report of the
then Land Management Bureau through Special Attorney Pacubas. Should the Government pursue
the filing of such an action, the possibility of winning the case is remote.49
More so, respondent Government, through its counsel, admits that the land applied by Fermina
Castro in 1973 was solid and dry land, negating the nebulous allegation that said land is
underwater. The only conclusion that can be derived from the admissions of the Solicitor General
and Government Corporate Counsel is that the land subject of the titles of petitioners is alienable
land beyond the reach of the reversion suit of the state.
Notably, the land in question has been the subject of a compromise agreement upheld by this Court
in Public Estates Authority.50 In that compromise agreement, among other provisions, it was held
that the property covered by TCT Nos. 446386 and S-29361, the land subject of the instant case,
would be exchanged for PEA property. The fact that PEA signed the May 15, 1998 Compromise
Agreement is already a clear admission that it recognized petitioners as true and legal owners of
the land subject of this controversy.
Moreover, PEA has waived its right to contest the legality and validity of Castro’s title. Such waiver
is clearly within the powers of PEA since it was created by PD 1084 as a body corporate "which shall
have the attribute of perpetual succession and possessed of the powers of the corporations, to be
exercised in conformity with the provisions of this Charter [PD 1084]."51 It has the power "to enter
into, make, perform and carry out contracts of every class and description, including loan
agreements, mortgages and other types of security arrangements, necessary or incidental to the
realization of its purposes with any person, firm or corporation, private or public, and with any
foreign government or entity."52 It also has the power to sue and be sued in its corporate name.53
Thus, the Compromise Agreement and the Deed of Exchange of Real Property signed by PEA with
the petitioners are legal, valid and binding on PEA. In the Compromise Agreement, it is provided
that it "settles in full all the claims/counterclaims of the parties against each other."54 The waiver
by PEA of its right to question petitioners’ title is fortified by the manifestation by PEA in the Joint
Motion for Judgment based on Compromise Agreement that
4. The parties herein hereto waive and abandon any and all other claims and counterclaims which
they may have against each other arising from this case or related thereto.55
Thus, there was a valid waiver of the right of respondent Republic through PEA to challenge
petitioners’ titles.
The recognition of petitioners’ legal ownership of the land is further bolstered by the categorical
and unequivocal acknowledgment made by PEA in its September 30, 2003 letter where it stated
that: "Your ownership thereof was acknowledged by PEA when it did not object to your
membership in the CBP-IA Association, in which an owner of a piece of land in CBP-IA automatically
becomes a member thereof."56 Section 26, Rule 130 provides that "the act, declaration or omission
of a party as to a relevant fact may be given in evidence against him." The admissions of PEA which
is the real party-in-interest in this case on the nature of the land of Fermina Castro are valid and
binding on respondent Republic. Respondent’s claim that the disputed land is underwater falls flat
in the face of the admissions of PEA against its interests. Hence, res judicata now effectively
precludes the relitigation of the issue of registrability of petitioners’ lot.
In sum, the Court finds that the reversion case should be dismissed for lack of jurisdiction on the
part of the Parañaque RTC. Even if we treat said case as a petition for annulment of judgment under
Rule 47 of the 1997 Rules of Civil Procedure, the dismissal of the case nevertheless has to be upheld
because it is already barred by laches. Even if laches is disregarded, still the suit is already
precluded by res judicata in view of the peculiar facts and circumstances obtaining therein.
WHEREFORE, premises considered, the petition is GRANTED. The Decision of the Court of Appeals
in CA-G.R. CV No. 76212 is REVERSED and SET ASIDE, and the August 7, 2002 Order of the
Parañaque City RTC, Branch 257 in Civil Case No. 01-0222 entitled Republic of the Philippines v.
Fermina Castro, et al. dismissing the complaint is AFFIRMED.
No costs.
SO ORDERED.

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Land Titles and Deeds | 1

G.R. No. 173289 February 17, 2010

ELAND PHILIPPINES, INC., Petitioner,

Hence, the present petition.

The grounds relied upon by the petitioner are the following:

The petition is impressed with merit.

Rule 35 of the 1997 Rules of Civil Procedure provides:

(1) Tax Declaration No. 015224-A (Exhibit "Q"; x x x.

(2) Tax Declaration No. 05019-B (Exhibit "R"; x x x.

(3) Tax Declaration No. 01926-B (Exhibit "S"; x x x.

(4) Tax Declaration No. GR-007-0007 (Exhibit "T" x x x.

The contention of defendant-appellant is untenable. Summary judgment is not only limited to

(a) The petitioner must have an estate or interest in the land;

G.R. No. L-22822 August 30, 1968

GREGORIA PALANCA, petitioner-appellant,

Lopez De Joya, Dimaguila and Hermoso for petitioner-appellant.

3. In holding that the testimony of the petitioner-appellant's witness, Ricardo Monfero, is

We uphold the stand of respondent-appellee Director of Patents.

xxx xxx xxx

xxx xxx xxx

xxx xxx xxx

xxx xxx xxx

xxx xxx xxx

xxx xxx xxx

xxx xxx xxx

G.R. No. 167232 July 31, 2009

D.B.T. MAR-BAY CONSTRUCTION, INCORPORATED, Petitioner,

The RTC's Rulings

WHEREFORE, in view of the foregoing considerations, judgment is hereby rendered declaring

The CA's Ruling

Hence, this Petition.

Petitioner raises the following as grounds for this Petition:

PETITIONER'S FAILURE TO ALLEGE PRESCRIPTION IN ITS ANSWER IS NOT A WAIVER OF SUCH

A REGISTERED LAND CAN NOT BE ACQUIRED BY ACQUISITIVE PRESCRIPTION.

We answer the first question in the affirmative.

It is true that in Dino v. Court of Appeals45 we ruled:

G.R. No. 147379 February 27, 2002

x x x petitioner’s failure to state in the certificate of non-forum shopping that he undertakes to

G.R. No. 168661 October 26, 2007

ESTATE OF THE LATE JESUS S. YUJUICO, represented by ADMINISTRATORS BENEDICTO V. YUJUICO

VELASCO, JR., J.:

The dispositive portion of the CA decision reads,

Hence, this petition.

Petitioners now raise the following issues before this Court:

THE COURT OF APPEALS COMMITTED REVERSIBLE ERROR AND DECIDED A QUESTION OF

III. RELIANCE BY THE COURT OF APPEALS ON THE ISOLATED PRONOUNCEMENT OF THE

A. THE INSTANT REVERSION CASE IS NOT THE PROPER RECOURSE.

IV. EQUITABLE CONSIDERATIONS MANDATE THE APPLICATION OF THE RULE ON ORDINARY

V. RESPONDENT CANNOT BE GIVEN SPECIAL CONSIDERATION AND EXCUSED FOR TRANSGRESSING

2. Conveyances made by non-Christians in violation of Section 120, CA No. 141; and

All told, a reversion suit will no longer be allowed at this stage.

It is negligence or omission to assert a right within a reasonable time, warranting a presumption

We agree with petitioners.

Section 14 of PD 1592 provides:

A. The Legal prognosis of the case is not promising in favor of PEA.

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