Ltd Digest Class 10

Llaban vs. CA, 204 SCRA 887 (1991) Author: Delgado Facts: i. In a decision rendered in September 1916, CFI Cebu awarded Lot No. 6017 to the petitioners. ii. Upon motions of the spouses Filemon Sotto and Carmen Rallos, who claimed to have purchased the shares of some of the adjudicatees of the lot or their heirs, the cadastral court, on 1 March 1932, issued an Auto. iii. No party appealed from the September 1916 decision as modified by the above Auto of March 1932. Neither was any decree issued pursuant to it. iv. After 42 years, claimants (respondents) filed a petition for the issuance of a decree of registration over the lot. v. Acting on the petition, CFI Cebu issued an Order directing the Commissioner of Land Registration to issue a decree in favor of the adjudicatees based on the dispositive portions of the decision of 13 September 1916 and the Auto of 1 March 1932. vi. Commissioner submitted a report which quoted the dispositive portions adverted to and contained the following pertinent observations: a) civil status of the adjudicatees was inadvertently omitted which is necessary in the preparation of the final decree of registration of Lot No. 6017 as provided for under Section 40 of Act 496 b) The Commission entertains a doubt which portions said lot were adjudicated to spouses Carmen Rallos de Sotto and Filemon Sotto and which share of the adjudicatees mentioned in the

decision dated September 13, 1916 were affected thereof. c) That it is imperative that the tracing cloth or print copy be submitted to this Commission prior to the issuance of the decree of registration d) The said plan and its technical descriptions should be approved by the Court and the same should be in conformity with the decision dated September 13, 1916 and Order dated March 1, 1932. vii. Various claimants soon began to lay their claim on the said lot. Private respondents claim that the predecessors-in-interest of the petitioners had sold the lot in question to the spouses Filemon Sotto and Carmen Rallos, now both deceased; petitioners have nothing then to inherit; and that they cannot now re-open the cadastral proceeding because the Order of March 1932 constitutes res judicata. viii. CFI Cebu ruled that the order of March 1932 superseded and/or amended the decision of September 1916 as reinstated in the order of March, 1925. As a decree of registration has not been issued registration proceedings is still pending for the purposes of pre-Commonwealth Act 3110, and, when lost or destroyed, must be reconstituted in conformity with said act. vix. They now allege that the Order of March 1932 was isosued without any notice to them; they were never given a chance to be heard and that they did not receive a copy of said order; they came to know about it only in the middle part of 1980; and granting that it was in fact issued, such was done in excess of and/or without jurisdiction. Issue: Lack of jurisdiction of the lower court, sitting as a cadastral court, to rule and decide on the controversy, or to pass upon the validity of the claim, sale or transfer in favor of

the private respondents, alleging that such matters could only be ventilated in an ordinary civil action. Held: Petition granted. Lower court has no jurisdiction to grant such relief and Judge Ramolete of CFI Cebu clearly acted without any jurisdiction or with grave abuse of discretion in giving due course to the petition by approving the Subdivision Plan Psd-17733, the technical descriptions of Lots Nos. 6017A to 6017-H, inclusive, and directing the Land Registration Commissioner to issue the final decree of registration of the subdivision lots in favor of each of the claimants named in the 14 May 1979 petition. Aggravating such action is his obvious disregard for due process. Ratio: i. The lower court, sitting as a cadastral court, had no jurisdiction to amend or modify the September 1916 decision and that Judge Ramolete of CFI Cebu acted without jurisdiction or with grave abuse of discretion in issuing the Order of 16 February 1981. ii. The September 1916 decision, as amended by the Auto of March 1932, had long become final as there is no showing at all that any affected party appealed therefrom within the reglementary period of 30 days prescribed by the then governing law on procedure, Act No. 190. Section 11 of the Cadastral Act expressly provides that trials in cadastral cases shall be conducted in the same manner as ordinary trial, and proceedings in the Court of First Instance shall be governed by the same rules and that all provisions of the Land Registration Act as amended, except as otherwise provided in the former, shall be applicable to proceedings in cadastral cases.

ii. Sections 38 and 41 of the Land Registration Act tell us when decisions become final. Even if they are erroneous, but such errors are not jurisdictional, correction could only be done by a regular appeal within the reglementary period, the failure of which could lead to the decisions' becoming final. Decisions, erroneous or not, become final after the period fixed by law; litigations would be endless; no questions would be finally settled; and titles to property would become precarious if the losing party were allowed to reopen them at any time in the future. iii. The failure to issue a final decree does not prevent the decision from attaining finality. Precisely, the final decree can only issue after the decision shall have become final. The final decree must state the name of the party adjudged in the decision to be owner of a cadastral lot. iv. In the instant case, in view of the finality of the decision of 13 September 1916, as amended by the Auto of March 1932, the final decree which can be validly issued is one which must be in full conformity with said decision, as amended. v. Except for the spouses Filemon Sotto and Carmen Rallos, the alleged claimants in whose favor the subdivided lots are to be adjudicated are not the adjudicatees in the September 1916 decision, as amended by the March 1932 Auto. And there is no indication whatsoever of the relationships of the claimants with the original adjudicatees that could serve as basis for their claims. In reality then, the petition is not just for the issuance of a final decree, but for the amendment or modification of the final decision. vi. In the absence of proof that they received a copy of the Order, no conclusion may be drawn that it has become final as against them. Besides, the order has no valid basis. It failed to consider the Auto of March 1932 which amended the original

decision of September 1916. Hence, no valid decree can be issued exclusively on the basis of the latter. Melgar vs. Pagayon, 21 SCRA 841 (1967) Author: MONZON

CA: ruled in favor of Pagayons and sustained the right of the vendee who did purchase registered land, thereafter securing the issuance of the corresponding title in his name. Issue: Who has the better right over the property? – Pagayons

Respondents’ (Pagayons) predecessors in interest, Salvador Pagayon, acquired the land by purchase from Basilia Paccial, the registered owner. Petitioner emanated from Eladio Palomillo, who claims to have acquired the land by virtue of Basilia's failure to repurchase the same within the stipulated period of three years. The subject land was owned by Paccial who sold it to one Palomillo subject to a right of repurchase within a period of three years.The period expired without such a right being exercised. Petitioner acquired whatever rights, interests and participation in the aforesaid. However, CFI Iloilo rendered judgment in Cadastral Case No. 31 decreeing the registration of the lot in favor of vendor Basilia Paccial, it being noted that it was encumbered to Palomillo. OCT was issued in the name of Paccial. AThe situation in this case is that of a vendee relying on a Torrens title as against another vendee allegedly having in his favor a sale with pacto de retro executed before the registration of the property. According to the brief, “the sale pacto de retro to Palomino does not appear in the Original Certificate of Title of the land in question because, Basilia Paccial had concealed this fact in her Answer in the Cadastral Case or in the hearing thereof when she obtained judgment. But this did not destroy the fact that Eladio Palomillo was already the owner of the disputed land”

Ruling: Neither the vendee a retro nor his transferee, petitioner, could still compel vendor Paccial to execute an absolute deed of sale, the action being barred by Section 43 of the Code of Civil Procedure. Cited Cabanos v. Register of Deeds, a 1920 decision: "the consolidation of title could not take place, because the vendor has obtained a certificate of title which has become indefeasible and absolutely binding against the whole world and could no longer be reviewed by reason of the expiration of the period for review, nevertheless, the decree of registration has not annulled the contract of pacto de retro sale which still subsists without any alteration and still remains valid and binding against the vendor, the latter's certificate of title not having rescinded nor destroyed the validity of the sale a retro." à "the incontestable and absolute character of the Torrens title." Land registration proceedings under Act 496 are in rem and that such proceedings, as well as the title issued , are binding and conclusive upon the whole world. Upon the expiration of one year, said decree and the title issuedbecome incontrovertible (Section 38, Act 496), and the same may no longer be changed, altered or modified, much less set aside.This has to be the rule, for if even after the ownership of a property has been decreed by a land registration court in favor of a particular person and title issued may still be annulled, alleged, changed, altered or modified after

the lapse of the one year period fixed by the legal provision mentioned above, the object of the Torrens system, namely, to guarantee the indefeasibility of the title to the property, would be defeated. In this case the above doctrine should apply with more reason, considering the fact that the property has passed from the hands of the original registered owner into those of clearly innocent third parties." Chief Justice Bengzon in another case: “He alleged ownership thru failure of the vendor a retro to repurchase in time. He had to prove such allegation. The defendants had a right to reply on the Torrens title issued in their name. If such repurchase was an essential step for the registration and confirmation of their ownership, the issuance of the certificate of title in their names gives rise to the presumption that it has been duly taken. . . . The result of the foregoing observations is that the precedents claimed by petitioner as practically foursquare with this, do not control the situation. Therefore he failed to establish any right superior to the conclusive title of defendants under the Torrens system."

Gomez vs. CA, 168 SCRA 503 (1988) Author: GOJAR Atty. Gomez et al applied for registration of several lots (Lots 1-12) before RTC Prior to the application for registration, said lots were involved in Government vs Abran case where SC declared Consolacion Gomez as the owner. Teodoro and Luis (Consolacion’s father

and son) inherited the lots. When Teodoro died, Luis executed a Quitclaim in favor of the Gomezes. Aug 5 1981 - After notice and publication and there being no opposition, the trial court adjudicated the lots in favour of petitioner Oct 6 1981 - Trial court issued an order stating the Aug 5 decision became final and excretory and directed the Chief of General Land Registration Office to issue the corresponding decrees of registration over the lots July 11 1984 - Respondent Silverio G. Perez, Chief of Division of Original Registration Land Registration Commission (now known as the National Land Titles and Deeds Registration Administration), submitted a report to the trial court stating that lots 15, 16, 34 and 41 of Ipd-92 were already covered by homestead patents issued in 1928 and 1929 and are registered under the Land Registration Act, he then recommended that the Aug 5 and Oct 6 decision be set aside March 25 1985 - trial court rendered a decision setting aside its Aug 5 and Oct 6 decision, hence petitioner filed MR which was denied CA: Dismissed the petition stating that when the respondent Judge amended his decision after the report of the respondent officials of the Land Registration office had shown that homestead patents had already been issued on some of the lots, respondents cannot be faulted because land already granted by homestead patent can no longer be the subject of another registration

ISSUE: Would finality of the decision adjudicating the land to the Gomezes bar the RTC from setting it aside? NO.

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HELD: Petitioner’s contentions: 1. The judgment became final and executory, hence the decree of registration be issued in a matter of course and when the judge set aside the Aug and Oct decision, he acted without jurisdiction. ●

This contention is NOT CORRECT. Unlike ordinary civil actions, the adjudication of land in a cadastral or land registration proceeding does not become final, in the sense of incontrovertibility until after the expiration of one (1) year after the entry of the final decree of registration. As long as a final decree has not been entered by the Land Registration Commission (now NLTDRA) and the period of one (1) year has not elapsed from date of entry of such decree, the title is not finally adjudicated and the decision in the registration proceeding continues to be under the control and sound discretion of the court rendering it

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3. Petitioners insist that the duty of the respondent land registration officials to issue the decree is purely ministerial ●

2. Respondent Perez should have submitted the report before the decision of the trial court became final and executory ●

The duty of respondent land registration officials to render reports is not limited to the period before the court’s decision becomes final, but may extend even

after its finality but not beyond the lapse of one (1) year from the entry of the decree. If the SC would sustain petitioner’s contention, it would be pressuring respondent land registration officials to submit a report or study even if haphazardly prepared just to beat the reglementary deadline for the finality of the court decision. Decrees of registration must be stated in convenient form for transcription upon the certificate of title and must contain an accurate technical description of the land. This requires technical men. Moreover, it frequently occurs that only portions of a parcel of land included in an application are ordered registered and that the limits of such portions can only be roughly indicated in the decision of the court. In such cases amendments of the plans and sometimes additional surveys become necessary before the final decree can be entered. That can hardly be done by the court itself; the law very wisely charges the Chief Surveyor of the General Land Registration Office with such duties

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It is ministerial in the sense that they act under the orders of the court and the decree must be in conformity with the decision of the court and with the data found in the record, and they have no discretion in the matter. HOWEVER, if they are in doubt upon any point in relation to the preparation and issuance of the decree,

it is their duty to refer the matter to the court. They act, in this respect, as officials of the court and not as administrative officials, and their act is the act of the court. They are specifically called upon to “extend assistance to courts in ordinary and cadastral land registration proceedings.” 4. The law of the case is found in the Gov. of the Phil. vs. Abran where the SC decided that the lands of Consolacion Gomez were not public lands ●

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It is now the law of the case. The report of respondent land registration officials states that the holders of the homestead patents registered the lots in question in the years 1928 and 1929. The decision in Government of the Philippine Islands vs. Abran was promulgated on 31 December 1931. Hence, the subject lots are specifically excluded from those adjudicated by the aforesaid decision to Consolacion M. Gomez. It is a settled rule that a homestead patent, once registered under the Land Registration Act, becomes indefeasible and incontrovertible as a Torrens title, and may no longer be the subject of an investigation for determination or judgment in cadastral proceeding.

5.Petitioners claim that the homestead title holders may still vindicate their rights by filing separate civil action ●

BUT the same recourse may be resorted by petitioners themselves. The petitioners may file a separate civil

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action for cancellation of titles and reconveyance in a court of ordinary civil jurisdiction. The true owner may bring an action to have the ownership or title to land judicially settled, and if the allegations of the plaintiff that he is the true owner of the parcel of land granted as free patent and described in the Torrens title and that the defendant and his predecessor-in-interest were never in possession of the parcel of land and knew that the plaintiff and his predecessor-in-interest have been in possession thereof be established, then the court in the exercise of its equity jurisdiction, without ordering the cancellation of the Torrens title issued upon the patent, may direct the defendant, the registered owner, to reconvey the parcel of land to the plaintiff who has been found to be the true owner thereof.

Ramos vs. Rodriguez, 244 SCRA 418 (1995) Author: Monje Facts: Feliciano Ramos applied for the registration of a parcel of land in San Jose, Rodriguez, Montalban, Rizal, identified as Lot 125-B of subdivision plan Psd-760 with a total area of 156,485 square meters. Upon his death on April 6, 1982 and during the pendency of said application, Feliciano was substituted by his heirs, petitioners herein. Trial Court: · In 1988, the court a quo issued an Order for Administrator of National Land Titles and Deeds Registration Administration (NLTDRA) to prepare the

decree and certificate of registration in compliance with Section 39 of Presidential Decree No. 1529 . · Instead of issuing the said decree, NLTDRA Administrator Teodoro G. Bonifacio submitted a report which was earlier required by the court, recommending that the July 28, 1988 decision be set aside after due hearing because the subject lot was part of Lot 125, Psu-32606 which is already covered by Transfer Certificate of Title (TCT) No. 8816 issued on in 1924 in the name of the Payatas Estate Improvement Company which was also assigned Decree No. 1131 on January 31, 1905. · Petitioners later claimed that TCT No. 8816 was fraudulent but they failed to present any evidence in support of such allegation. · Court opined "that it cannot set aside its (July 28, 1988) decision on the basis of the report dated September 26, 1988, which was received by this Court on October 10, 1988, after the finality of its decision." · Court added that the proper remedy of the government was an action for annulment of judgment. · Bonifacio filed on March 9, 1990, through the Chief Legal Officer of the Land Registration Authority (LRA), a motion for reconsideration of the February 2, 1990, order. · Court- granted MR and set aside its former decision Issues/Held: 1. W/n the first judgment of the Court could be nullified- YES 2. W/n the issuance of the decree of registration and the certificate of title by the LRA is a ministerial duty which follows

as a matter of course the order of the court directing it to issue said decree.- As a general rule YES but there is an exceptional circumstance that we can answer NO 3. W/N respondent judge committed grave abuse of discretion in setting aside the July 28, 1988, decision and the order for issuance of decree dated September 12, 1988, upon the mere motion for reconsideration filed by the LRA, not by the Solicitor General- NO Ratio: 1. This is because unlike ordinary civil actions, the adjudication of land in a cadastral or land registration proceeding does not become final, in the sense of incontrovertibility(,) until after the expiration of one (1) year after (sic) the entry of the final decree of registration. As long as a final decree has not been entered by the Land Registration Commission (now NLTDRA) and the period of one (1) year has not elapsed from the date of entry of such decree, the title is not finally adjudicated and the decision in the registration proceeding continues to be under the control and sound discretion of the court rendering it. 2. It is ministerial in the sense that they act under the orders of the court and the decree must be in conformity with the decision of the court and with the data found in the record, and they have no discretion in the matter. However, if they are in doubt upon any point in relation to the preparation and issuance of the decree, it is their duty to refer the matter to the court. They act, in this respect as officials of the court and not as administrative officials, and their act is the act of the court. They are specifically called upon to "extend assistance to courts in ordinary and cadastral land registration proceedings."

Administrator Bonifacio filed his report as an officer of the court precisely to inform the latter that the NLTDRA cannot comply with the order to issue a decree because the subject lot sought to be registered was discovered to have been already decreed and titled in the name of the Payatas Estate. Under these circumstances, the LRA is not legally obligated to follow the court's order. The court's Order for Issuance of Decree is NOT the reckoning point in determining the timeliness of a petition to re-open or review the decree of registration in view of the ministerial nature of the LRA's duty. Also, the one-year period stated in section 32 of P.D. 1529 within which a petition to re-open and review the decree of registration clearly refers to the decree of registration described in Section 31 of the said P.D., which decree is prepared and issued by the Commissioner of Land Registration. 3. The court a quo could not have committed grave abuse of discretion because it was merely following the earlier recommendation of the LRA which was then acting as an agent of the court. Under the Administrative Code of 1987, the Solicitor General is bound to "[r]epresent the Government in all land registration and related proceedings." Add to this the fact that P.D. 1529 itself, specifically Section 6 thereof which enumerates the functions of the Commissioner of Land Registration, is bereft of any grant of power to the LRA or to the Commissioner to make the same representation as the Office of the Solicitor General in behalf of the government in land registration proceedings.

Nevertheless, even granting that procedural lapses have been committed in the proceedings below, these may be ignored by the Court in the interest of substantive justice. This is especially true when, as in this case, a strict adherence to the rules would result in a situation where the LRA would be compelled to issue a decree of registration over land which has already been decreed to and titled in the name of another. TCT No. 8816, however, having been issued under the Torrens system, enjoys the conclusive presumption of validity. MOREOVER, COURT NOTES THAT THE CONTROVERSIES IN THE CASE MIGHT HAVE BEEN AVOIDED IF: 1. If the proper procedure in land registration cases been observed by both the trial court, acting as a land registration court and by the LRA, acting as an agent of the court. The court should have rendered its decision only "after considering the evidence and the reports of the commissioner of Land Registration and the Director of Lands," as mandated by Section 29 of P.D. 1529, instead of precipitately adjudicating the land in question to the applicant and directing the Commissioner to issue a decree of registration and certificate of title when the report of the LRA was still forthcoming. 2. If the Solicitor General is more vigilant in handling cases which his office should, under the law, properly represent.

Phil. Trust Co. vs. CA, G.R. No. 150318, November 22, 2010 Author: CD Facts: Property was owned by Forfom Development Corp (Forfom) under TCT 10896 and 64884. Sometime in 1989, plaintiff discovered that the subject properties had already been transferred in the names of said Ma. Teresa Limcauco and Ellenora Limcauco who were never known to plaintiff or its employees. Forfom sought help from the NBI and it was discovered to transfer the lots, the signature of former President Felix Limcauco was forged in the Deed of Sale and a certification to the effect that plaintiffs Board of Directors had duly approved the sale. A petition for issuance of owners duplicate copy was filed with the RTC of Angeles City by Ellenora Limcauco who allegedly lost said owners duplicate copy of TCT No. 64884 docketed as Cad. Case No. A-124-160. Court granted but Judge Guinto denied before the NBI authorities having signed such order or having conducted hearing on said case. The copy submitted to the Register of Deeds was merely stamped Original Signed. Another document certifying that the Order granting the petition in Cad. Case No. A-124-160 had become final and executory was also submitted to the Register of Deeds in connection with the cancellation of TCT No. 64884. However, then Branch Clerk of Court Benedicto A. Pineda testified that he did not sign said certification and neither had he been aware of the proceedings in Cad. Case No. A-124-160. Atty. Pinedas signature on said certification appears to have been falsified by one Lorenzo San Andres.

A separate petition for issuance of owners duplicate copy was also filed by Ma. Teresa in Cad. Case No. A-124-280 and as a result, TCT No. 10896 was cancelled and TCT No. 82760/T414 was issued in the name of Ma. Teresa Limcauco On September 23, 1987, a Deed of Absolute Sale was executed by Ellenora Vda. De Limcauco in favor of defendant Raul P. Claveria whereby the property covered by TCT No. 64884 was supposedly sold to said defendant for the sum of P5,139,126.00. On September 24, 1987, TCT No. 75436/T378 was cancelled and a new certificate of title, TCT No. 75533 was issued in the name of defendant Raul P. Claveria. On October 21, 1987, defendant spouses Raul and Elea Claveria mortgaged the property with the defendant Philippine Trust Company to guarantee a loan in the amount of P8,000,000.00, which mortgage was duly registered and annotated as Entry No. 2858 in TCT No. 75533. Issue: 1. Whether a bank, as a mortgagee, is required to look beyond the certificate of title 2. Whether Philtrust is a mortgagee in good or bad faith. Held: 1. As a general rule, no but in granting a mortgage contract (ie documents that support the contract and following SOP of Banks in determining credit) they must exercise extraordinary diligence

2. Philtrust is in bad faith Ratio:

1. A bank is not required, before accepting a mortgage, to make an investigation of the title of the property being given as security. This is a consequence of the rule that a person dealing with registered land has a right to rely upon the face of the Torrens certificate of title and to dispense with the need of inquiring further, except when the party concerned has actual knowledge of facts and circumstances that would impel a reasonably cautious man to make such inquiry. A forged deed may be the root of a valid title when an innocent purchaser for value intervenes. A purchaser in good faith and for value is one who buys the property of another without notice that some other person has a right to or interest in such property and pays a full and fair price for the same, at the time of such purchase, or before he has notice of the claims or interest of some other person in the property. It has been held that where a mortgagee bank accepted the mortgage in good faith, the land involved being registered land, it is not bound to go [beyond] the certificate of title to look for flaws in the mortgagors title, the doctrine of innocent purchaser for value being applicable to an innocent mortgagee for value. A mortgagee in good faith and for value is entitled to protection.

The protection that a party may rely solely on the title is applicable for those in good faith. But it is settled that banks, their business being impressed with public interest, are expected to exercise more care and prudence than private individuals in their dealings, even those involving registered lands. The rule that persons dealing with registered lands can rely solely on the certificate of title does not apply to banks. Consequently, Philtrust should prove that it exercised extraordinary diligence required of it in approving the mortgage contract in favor of the spouses Claveria.

we find that the Court of Appeals did not even err in finding that Philtrust was in bad faith in the execution of the mortgage contract with the spouses Claveria. 2. Evidence which show that Philtrust knew of the scheme

They did not investigate the collateral being offered by the spouses (they have a property in Ayala Alabang but a newly bought property outside Metro Manila was offered and accepted). They did not visit the property. When asked why they granted the loan without security, they mere answered that the spouses passed the standards of the bank. SC: The mere fact that Philtrust accepted the subject property as security most certainly does not prove that it followed the standard operating procedure in doing so. Evid (not important) Philtrust adds that it stated in the Answer to Interrogatories that it followed the standard operating procedures in accepting the property as security. Since said Answer to Interrogatories is a notarized document, Philtrust claims that it is a public document which is conclusive as to the truthfulness of its contents. SC: it is not a public document that is conclusive to the truthfulness of the content. It falls under (b) Documents acknowledged before a notary public except last wills and testaments; The presumption that official duty has been regularly performed therefore applies only to the Jurat, wherein the notary public (public officer authorized to take oath) merely attests that the affidavit was subscribed and sworn to before him or her, on the date mentioned thereon

Camper Realty Corp. vs. Maria Nena Pajo-Reyes, G.R. No. 179543 October 6, 2010 Author: Adrian FACTS:

1. Rodolfo pajo caused the notarization on March 27, 1974 by Atty. Naraval of a SPA executed by him and purportedly by his 4 siblings: Nena, Godofredo, Tito and Isaias. The SPA authorized Rodolfo to sell a parcel of land with an area of 8,060 sq m, situated in Davao City. 2. The day after, Rodolfo sold the property to Ligaya Bajado who thereafter caused the cancellation of the title and issuance of a new title in her name. 3. 2 days after he notarized the SPA, Atty. Naraval observed that all the signatures, except that of Rodolfo, were forged. He then wrote a letter to Rodolfo’s coowners, cancelling the SPA from his notarial register. 4. After Ligaya passed away, the property was bequeathed to her son, Augusto. Ligaya’s title was cancelled and a new title was issued in the name of Augusto. 5. Augusto divided the property into two: one containing 7,420 sq m, which was sold to Camper Realty Corp (title was still in Augusto’s name), and the other, 640 sq m he retained. 6. After 19 years, Nena filed a complaint against Augusto and Rodolfo and Godofredo for declaration of nullity and cancellation of title before the RTC of Davao City. Upon learning of Augusto’s sale to Camper Realty Corp, Nena impleaded the latter as necessary party. 7. Nena contended that no right could have been transmitted to Ligaya and the subsequent transferees, the SPA being a forged document. 8. RTC: Dismissed the case. Nena is guilty of laches. Titles to the property were already under the name of the transferors at the time of transfer. The court cannot declare the nullity of the succeeding contracts.

9. CA: Reversed the RTC ruling. There was no valid transfer to Ligaya and, accordingly, to her son Augusto. He did not acquire any right over the subject lot since an heir merely steps into the shoes of the decedent and is merely the continuation of the personality of his predecessor-in-interest. Contract of sale entered with Camper was invalid. ISSUE: WON Camper Realty Corp is entitled to the subject lot HELD: YES, Camper is a purchaser in good faith RATIO: 1. Augusto acquired the property as his share in his mother Ligaya’s estate. As compulsory heir, he merely stepped into the shoes of Ligaya. Since Ligaya’s title was derived from Rodolfo’s sale to her on the basis of a forged SPA, Augusto’s title must be cancelled. Nemo dat quod non habet. 2. Notwithstanding the nullity of Augusto’s title, Camper Realty Corp is a purchaser in good faith. 3. A forged deed can legally be the root of a valid title when an innocent purchaser for value intervenes. For a prospective buyer of a property registered under the Torrens system need not go beyond the title, especially when he has no notice of any badge of fraud or defect that would place him on guard. His rights are entitled to full protection, for the law considers him an innocent purchaser. 4. There was no duty on petitioner’s part to go beyond the face of Augusto’s title and conduct inquiries on its

veracity. Nena did not present any proof of any circumstance that could serve as caveat for petitioner to undertake a searching investigation respecting the title. Moreover, the property was registered in Ligaya’s name in 1974 yet, Augusto’s in 1986, and no encumbrance or lien was annotated either on Ligaya’s or Augusto’s title. For 18 years, there was no controversy or dispute hounding the property to caution petitioner about Augusto’s title. Heirs of Saves vs. Saves, G.R. No. 152866, October 6, 2010 Author: LIN FACTS: 1. Sometime on January 1921, several persons filed their respective claims before the then, CFI of of Oriental Negros for the titling of the respective lots they occupy, among them were Severo Chaves and Benedicta Chaves, who filed their claim for Lot No. 382, to be titled in their names, together with 5 OTHER Saves, in Cadastral Case No. 15. 2. On April 22, 1921, a Decision was rendered by the court, adjudicating several parcels of land to different claimants, among the lots adjudicated, also Decree No. 177831 was issued by the USA for CFI of the Province of Negros ordering the registration of Lot No. 382 in the names of Benedicta Saves, Escolastica Saves, the sons of Romana Saves, deceased, Rafaela Saves, Januaria Saves, and the sons of Maximo Saves, deceased. Thereafter, Severo Saves died intestate, leaving his wife, Teresa Ramirez, his 4 surviving children, and the heirs of his two children who predeceased him.

3. On June 21, 1941, Adelaida S. Martinez and Felicidad S. Martinez, 9. The parties failed to arrive to an amicable settlement during the prewho were the heirs of Januaria Saves, who predeceased them, sold trial stage, but have agreed to exclude Lot 386 in the litigation and their 1/6 share in Lot No. 382 to a certain Gaudencia Valencia limited the issues as to the ownership of lots 382 and 383. 10. RTC rendered decision in favor of petitioners, declaring deed of sale evidenced by a public instrument, per allegation in a Motion for the as null and void, and ordering defendant Abella to convey and Issuance of Transfer Certificate of Title, filed by Valencia. 4. On June 30, 1941, a Deed of Sale was executed by the 5 heirs of deliver unto the plaintiffs their shares of Lot No. 382. CA reversed Romana Saves, with last names of Alimayda; the sole heir of RTC ruling, and held that Abella’s TCT was valid. Rafaela Saves, Pablo Saves Dizon; and the sole heir of Escolastico Saves, Teodoro Saves, their respective 1/6 share in Lot No. 382, or ISSUE: Whether the Court of Appeals can consider evidence 3/6 of the property, to Valencia. not formally offered in the trial court as basis for the herein 5. On June 6, 1947, Benedicta Saves and Marcela Saves, the sole heir assailed Court of Appeals ruling? of Maximo Saves, sold their respective 1/6 share in Lot No. 382, also to Valencia, or 2/6 of the property, as embodied in a Deed of HELD: Yes, since exception requirements were followed. Absolute Sale. Considering that all the 1/6 share, rights, and PETITION DENIED. participation of each co-owner in Lot No. 382 were already sold to1. GR: It is a basic procedural rule that the court shall consider no Valencia, she initiated the titling of the said property under her name evidence which has not been formally offered. The purpose for in a Motion for Issuance of Transfer Certificate of Title before CFI, which the evidence is offered must be specified. A formal offer is TCT No. 148 was issued by the Register of Deeds for Negros necessary because judges are mandated to rest their findings of Oriental in the name of Valencia. facts and their judgment only and strictly upon the evidence 6. Sometime in 1961, Valencia sold the entire property to her grandchild offered by the parties at the trial. Its function is to enable the trial Enriqueta Chavez Abella, and TCT No. 110 was issued in the name judge to know the purpose or purposes for which the proponent is of Enriqueta Chavez, who was married to Abella. presenting the evidence. This allows opposing parties to examine 7. In 1979, Meleriana Saves, who was then residing in Cebu, wrote her the evidence and object to its admissibility. It facilitates review as relatives in Negros Oriental, the herein appellees, asking them to the appellate court will not be required to review documents not verify from the Register of Deeds information pertaining to Lot 382, previously scrutinized by the trial court. as they were among the heirs entitled to said property. 2. XPN: However, in People v. Napat-a, citing People v. Mate, 8. On March 17, 1981, a case for Reconveyance, Partition, and relaxed the foregoing rule and allowed evidence not formally Damages was filed before the RTC of Negros Oriental by plaintiffsoffered to be admitted and considered by the trial court provided appellees, alleging, inter alia, that Lot No. 382 was fraudulently the following requirements are present, viz: first, the same must acquired by Valencia, and that she fictitiously sold the lot to her have been duly identified by testimony duly recorded and, grandchild Abella. The complaint was amended twice by plaintiffs second, the same must have been incorporated in the records of considering that the original plaintiffs and defendants were all the case. In the case at bar, the records would show that the deceased.

above requisites have been satisfactorily complied with respect to Exhibit 7 which is a document entitled Motion for the Issuance of TCT filed by Valencia in the same trial court that led to the issuance of TCT No. 148, the records would show that it is the same document that petitioner’s witness Fruto Rosario identified in his March 5, 1984 testimony and marked as petitioner’s Exhibit I, he testified that Maximo had 2 children, Maximo died ahead of Severa, Severa died ahead of Marcela. 3. It is a well-settled doctrine that one who deals with property registered under the Torrens system need not go beyond the same, but only has to rely on the certificates of title. He is charged with notice only of such burdens and claims as are annotated on the certificates. In the case at bar, TCT No. 110, which represented proof of respondent Abellas ownership of Lot No. 382, did not contain any encumbrance or annotation that was transferred from its title of origin - TCT No. 148. To be sure, the burden to prove that Abella had notice of any defect in the title of her predecessor lies with the plaintiffs. Plaintiffs failed to substantiate their contention. 4. There is no cogent reason or legal compulsion for respondent Abella to inquire beyond Valencias title over the property at issue since the latter had been in possession of Lot No. 382 prior to the sale. Settled is the rule that a buyer of real property in possession of persons other than the seller must be wary and should investigate the rights of those in possession, for without such inquiry the buyer can hardly be regarded as a buyer in good faith and cannot have any right over the property. Valencia had been occupying the property prior to its sale to respondent Abella. Petitioners were never in possession of the property from the very start, nor did they have any idea that they were entitled to the fruits of the property not until co-petitioner Meleriana Saves

wrote her relatives, co-petitioners, about the possibility of having a claim to the property. 5. Neither does the plaintiffs insistence that the deeds of sale executed in favor of Valencia were void support their theory that Abella is a purchaser in bad faith, as it hardly suffice to deem the said contracts as null and void. Abella had no participation in its execution which were signed by the parties thereto when she was very young. Like any stranger to the said transactions, it was reasonable for Abella to assume that these public documents were what they purport to be on their face in the absence of any circumstance to lead her to believe otherwise. Petitioners and predecessors never interposed any challenge to Valencias continued possession under title of ownership over Lot No. 382 ever since the entire property was sold to her in 1947 it was not only until 1981, or 34 years from Valencias acquisition of the entire lot and 20 years from the transfer of ownership over the same to respondent Abella, that petitioners decided to assert their alleged rights over the property in a proper action in court. Court of Appeals vs. Veloso, G.R. No. 102737, August 21, 1996, 260 SCRA 593 Author: Isabel Facts: ● Veloso was the registered owner of a parcel of land located in Tondo, Manila. It had an area of 177 sqm and it was covered by TCT 49138. He acquired it from the Philippine Building Corporation in 1957. He found out his copy was missing when his wife (Irma) left for abroad. ● He filed an action for annulment of documents, reconveyance of property w/ damages and preliminary injunction and/or restraining order against Escario, who obtained another TCT

for the same land. The said transfer was supported by a General Power of Attorney (GPA) and Deed of Absolute Sale executed by Escario and Irma, who acted as his atty-in-fact. ● He alleged that: He never authorized anyone to sell the property; He never executed the GPA; His signature was falsified; He’s never seen the two witnesses to the GPA; He’s never met Escario; He married Irma only in 1962 so the property wasn’t part of their conjugal partnership; He likewise presented Allied Bank checks to show his genuine signature. ● The notary Public, Atty. Tubig, likewise denied having notarized the documents. ● Escario contends that she relied on the general power of atty of Irma and so, she was a buyer in good faith. Veloso’s real cause of action is against his wife. ● TC adjudged Escario as the lawful owner as she was an innocent purchaser for value. The general power of atty was valid and there’s no need for a special power of atty (SPA) since the former already included the authority to sell. Veloso also failed to substantiate his claim of fraud. Considering his admission that he was the only person with access to the title, Irma’s possession was deemed conclusive authority. Under equitable estoppel, he must bear the loss. ● CA affirmed.

49138…” What matters is the extent of the powers contemplated. If the power to sell is specific and not merely implied or couched in general terms, the atty in fact may execute a valid sale. ● Mere variance of signatures is not conclusive proof as to forgery. It must be proved by clear and convincing evidence. Whoever alleges it has the burden of proving the same. It was necessary to determine the cause of the variation (whether it be due to a different personality or an expected variation by the same writer) and the resemblance (imitation or habitual natural resemblance from writing.) ● Even assuming there was forgery and the docs were void, Escario’s TCT cannot be revoked. She had no participation in the execution of GPA and was an innocent purchaser for value. It was reasonable to believe in Irma’s authority as Veloso’s wife and having with her the TCT. ● Purchaser in good faith is one who buys and pays for property without notice or knowledge that another person has a right/interest in the same at the time of such purchase. ● Equitable Estoppel:Where innocent persons must suffer a loss, he who by his conduct made the loss possible must bear it. Veloso was the only person who had access to the TCT. As such, Irma’s possession of the TCT was deemed conclusive authority from Veloso.

Issue: W/N there was a valid sale - YES Held: ● The assailed GPA was valid and regular on its face. It was notarized and it carried the presumption of due execution. Hence, Irma had authority. ● SPA to sell the subject property was already included in the GPA which states “to buy or sell, hire or lease, mortgage or otherwise hypothecate lands… more specifically TCT No.

Spouses Aggabao vs. Sps. Dionisio, G.R. No. 165803, Sept. 1, 2010. Author: Garcia Doctrine:

Alienation or encumbrance of conjugal property during the effectivity of the FC is void if without authority of the court or the written consent of the other spouse. (Art. 124, FC) To be considered buyers in good faith, the buyer must show that he has inquired into 1) the seller’s title and 2) the seller’s capacity to sell. Facts: Spouses Elena and Dionisio Parulan were under de facto separation. Their conjugal property consisted of, among others, 2 parcels of land located at No. 49 Miguel Cuaderno Street, Executive Village, BF Homes, Paraaque City and registered under TCT No. 63376 and TCT No. 63377 in the name of Spouses Maria Elena A. Parulan (Elena) and Dionisio Z. Parulan, Jr. (Dionisio). On March 18, 1991, Elena sold the lands to Spouses Aggabao (BUYERS) and showed them a Special Power of Attorney (SPA) purportedly executed by her husband to authorize her to sell them. But the SPA was a forgery, the husband being out of the country at the time of its execution, as evidenced by the entries in his passport. Elena and the BUYERS agreed that the BUYERS would pay the existing mortgage on the land covered by TCT 63377. When the BUYERS were paying the mortgage annotated on TCT 63377, the bank (Los Banos Rural Bank) related (chinismis lang) to them that the bank had asked for a court order authorizing Elena to mortgage the lot covered by TCT 63377. When the mortgage was satisfied, the bank then

released TCT 633777, which was later cancelled, and a new one was issued in the name of the BUYERS. As for TCT 63376, Elena could not deliver it to the BUYERS because it was then in the possession of the Dionisio’s brother, Atty. Jeremy Parulan, who was in possession of an authentic SPA executed by Dionisio authorizing him to sell herein lands. Despite what they heard from the bank, the BUYERS did not ask Elena for a court order authorizing her to sell the lands, nor did they confirm the authority of the Notary Public (NP) who notarized the SPA. It turned out that in 1991, the NP was not authorized to act as NP in Manila. As a result, the Husband sought the nullification of the absolute sale and the cancellation of the new TCT issued to the BUYERS. The BUYERS claimed to be buyers in good faith. RTC declared the Deed of Absolute Sale as void. CA affirmed RTC. Issues: Can a spouse sell a conjugal property without the consent of the other spouse?—No, by express provision of the Family Code, i.e., Art. 124. Can herein buyers be considered buyers in good faith?—No Held: With respect to the first issue:

Article 124 of the Family Code provides: “Article 124. The administration and enjoyment of the conjugal partnership property shall belong to both spouses jointly. In case of disagreement, the husband’s decision shall prevail, subject to recourse to the court by the wife for proper remedy, which must be availed of within five years from the date of the contract implementing such decision. “In the event that one spouse is incapacitated or otherwise unable to participate in the administration of the conjugal properties, the other spouse may assume sole powers of administration. These powers do not include disposition or encumbrance without authority of the court or the written consent of the other spouse. In the absence of such authority or consent, the disposition or encumbrance shall be void. However, the transaction shall be construed as a continuing offer on the part of the consenting spouse and the third person, and may be perfected as a binding contract upon the acceptance by the other spouse or authorization by the court before the offer is withdrawn by either or both offerors.” In short, alienation or encumbrance of conjugal property during the effectivity of the FC is void if without authority of the court or the written consent of the other spouse. In this case, the sale happened on March 18, 1991, or after the effectivity of the FC—August 3, 1988—and without the consent of the other spouse or court order authorizing the sale. Thus, the Deed of Absolute Sale was declared void.

Note: In the absence of the other spouse’s consent, the transaction should be construed as a continuing offer on the part of the consenting spouse and the third person, and may be perfected as a binding contract upon the acceptance by the other spouse or upon authorization by the court before the offer is withdrawn by either or both offerors. With respect to the second issue: (For summary, see last paragraph) A purchaser in good faith is one who buys the property of another, without notice that some other person has a right to, or interest in, such property, and pays the full and fair price for it at the time of such purchase or before he has notice of the claim or interest of some other persons in the property. He buys the property with the belief that the person from whom he receives the thing was the owner and could convey title to the property. He cannot close his eyes to facts that should put a reasonable man on his guard and still claim he acted in good faith. The status of a buyer in good faith is never presumed but must be proven by the person invoking it. Article 124 of the Family Code categorically requires the consent of both spouses before the conjugal property may be disposed of by sale, mortgage, or other modes of disposition. In Bautista v. Silva, the Court erected a standard to determine the good faith of the buyers dealing with a seller who had title to and possession of the land but whose capacity to sell was restricted, in that the consent of the other spouse was required before the conveyance, declaring that in order to prove good faith in such a situation, the buyers must show that they inquired not only into the title of the seller but also into the

seller’s capacity to sell. Thus, the buyers of conjugal property must observe two kinds of requisite diligence, namely: (a) the diligence in verifying the validity of the title covering the property; and (b) the diligence in inquiring into the authority of the transacting spouse to sell conjugal property in behalf of the other spouse.

authorized to act as a Notary Public for Manila during the period 1990-1991, which was a fact that they could easily discover with a modicum of zeal. In fact, they fully paid the price even without the owner’s duplicate copy of the TCT No. 63376 being handed to them by Elena, which indicated a revealing lack of precaution on the part of the petitioners.

It is true that a buyer of registered land needs only to show that he has relied on the face of the certificate of title to the property, for he is not required to explore beyond what the certificate indicates on its face. In this respect, the petitioners sufficiently proved that they had checked on the authenticity of TCT No. 63376 and TCT No. 63377 with the Office of the Register of Deeds in Pasay City as the custodian of the land records; and that they had also gone to the bank to inquire about the mortgage annotated on TCT No. 63377. Thereby, the petitioners observed the requisite diligence in examining the validity of the TCTs concerned.

In sum, to be considered buyers in good faith, the buyer must show that he has inquired into 1) the seller’s title and 2) the seller’s capacity to sell. In this case, although the BUYERS checked the authenticity of the TCTs with the Office of the Register of Deeds, they failed to inquire the seller’s capacity to sell. They just accepted the SPA for what it represented on its face.

However, issue was whether or not the BUYERS had diligently inquired into the authority of Elena to convey the property. In this case, they did not. An unquestioning reliance by the BUYERS on Elena’s SPA without first taking precautions to verify its authenticity was not a prudent buyer’s move. They should have done everything within their means and power to ascertain whether the SPA had been genuine and authentic. If they did not investigate on the relations of the respondents Elena and Dionisio vis-à-vis each other, they could have done other things towards the same end, like attempting to locate the notary public who had notarized the SPA, or checked with the RTC in Manila to confirm the authority of Notary Public Atty. Datingaling. It turned out that Atty. Datingaling was not

Facts: 1. On August 14, 1945, plaintiff Jose L. Ponce de Leon and Francisco Soriano, father of third-party plaintiffs obtained a loan for P10k from the PNB Manila, mortgaging a parcel of land situated at Barrio Ibayo, Municipality of Parañaque, Rizal, covered by OCT No. 8094 of the land records of Rizal Province in the name of “Francisco Soriano, married to Tomasa Rodriguez”, as security for the loan. 2. Jose L. Ponce de Leon filed with the Rehabilitation Finance Corporation (RFC for short) Manila, his loan application for an industrial loan, for putting up a sawmill, in the amount of P800k offering as security

Ponce de Leon vs. Rehabilitation Finance Corp., 36 SCRA 289 (1976) Author: LARS

certain parcels of land, among which, was the parcel which Ponce de Leon and Soriano mortgaged to the PNB. Jose Ponce De Leon, his wife Carmela and, Francisco Soriano(father of third party plaintiff) filed for a loan from the RFC for P495k. A deed of mortgage was then executed in view of the loan, secured by a parcel of land owned by Soriano. At the time that Francisco Soriano signed the mortgage deed his spouse Tomasa Rodriguez was already dead leaving as her heirs, her children none of whom signed the said mortgage deed or the promissory note. 3. It was stipulated that part of the proceeds of the mortgage loan shall be used to pay off obligations. In view of these conditions, the RFC paid Ponce de Leon's obligations to PNB, Cu Unjieng Bros and Arturo Colmenares. Various amounts were released to Ponce de Leon from December 1951 to July 1952. The checks covering these releases were issued to Jose L. Ponce de Leon in view of the authority given to him in writing by Francisco Soriano and Carmelina Russell. 4. Allegedly, the loan was not paid. Because of this, RFC sought for extra-judicial foreclosure of the mortgaged properties (real estate+sawmill in Samar and equipment). RFC was the purchaser of all the mortgaged properties in the ensuing sheriff's sales, with the exception of two parcels of land situated in Bacolod City which were purchased by private individuals. 5. The Sheriff sold the land covered by OCT No. 8094 in the name of Francisco Soriano, married to Tomasa Rodriguez, and the deed of sale was

6.

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executed by the sheriff in favor of the purchaser the RFC, including all the other properties sold. Prior to the expiration of the one year period redemption period. Francisco Soriano(through his heirs) offered to repurchase the Paranaque lot for 14k but the bank(RFC) rejected the offer. RFC scheduled the public sale of the lot. In 1956, Ponce filed the present action questioning the validity of the sherriff’s foreclose sale, and requiring a writ of preliminary injunction to restrain RFC from carrying out its scheduled sale. The Sorianos filed a 3rd party complaint contending that the mortgage in favor of the RFC and promissory note signed by Francisco Soriano lacked the latter's consent and was w/o consideration and hence void as to him and his children; that the lot covered by OCT No. 8094 in the name of Francisco Soriano belonged to the conjugal partnership of the latter and his wife, Tomasa Rodriguez, now deceased, and since the latter was already dead when the mortgage was executed and her children who inherited her share have not signed the mortgage contract and promissory note, at least, the ½ share of the lot belonging now to the Soriano sisters and brothers, the third-party plaintiffs, have not been legally included in the mortgage to the RFC so the latter had not acquired said one-half share in the sheriff's sale. TC dismissed Ponce’s complaint and held that being registered in the name of "Francisco Soriano, married to Tomasa Rodriguez," the property covered by OCT No. 8094(the Parañaque property) is presumed belong to the conjugal partnership of said spouses, and the

RFC having failed to offset this presumption, the mortgage on and the sale of the property by the sheriff are null and void as to one-half (½) thereof. ISSUE: Whether the TC erred erred in holding that the Parañaque property is presumed to belong to the conjugal partnership of Mr. and Mrs. Francisco Soriano? YES HELD: 1. It appears that the property was registered in the name of "Francisco Soriano, married to Tomasa Rodriguez," and based upon this fact alone without any proof establishing satisfactorily that the property had been acquired during coverture, the lower court presumed that it belongs to the conjugal partnership of said spouses. 2. We should not overlook the fact that the title to said property was not a transfer certificate of title, but an original one, issued in accordance with a decree which, pursuant to law, merely confirms a preexisting title. Said original certificate of title does not establish, therefore, the time of acquisition of the Parañaque property by the registered owner thereof. 3. Lower Court applied said presumption in Article 160 of our Civil Code, which reads: ... All property of the marriage is presumed to belong to the conjugal partnership, unless it be proved that it pertains exclusively to the husband or to the wife.

4. This provision must be construed in relation to Articles 153 to 159 of the same Code, enumerating the properties "acquired ... during the marriage" that constitute the conjugal partnership. We have held that "the party who invokes this presumption must first prove that the property in controversy was acquired during the marriage. In other words, proof of acquisition during coverture is a condition sine qua non for the operation of the presumption in favor of conjugal partnership. 5. The Sorianos have not succeeded in proving that the Parañaque property was acquired "during the marriage" of their parents. What is more, there is substantial evidence to the contrary. 6. Gregorio Soriano testified that his first cousin, Francisco Soriano, had acquired said property from his parents, long before he got married. Said prosecution does not necessarily warrant the conclusion that Gregorio Soriano was impelled by an "improper motive" in testifying as he did. After all, the Sorianos are, likewise, nieces of Gregorio Soriano and he was not the party allegedly accused by them. 7. This witness testified in a straightforward manner, and disclosed a good number of details bearing the earmarks of veracity. His testimony was corroborated, not only by Felipe Cuaderno, Jr. and OCT No. 8094, but, also, by the testimony of 3rd plaintiff Rosalina Soriano. Felipe Cuaderno, Jr., an assistant attorney and notary public of the RFC, before whom the deed of mortgage was acknowledged, testified that Francisco Soriano assured him that the Parañaque property was "his own separate property, having acquired it from his

deceased father by inheritance and that his children have nothing to do with the property." This was, in effect, confirmed by Rosalina Soriano, stated on crossexamination, that her father "was born and ... raised" in said property, so that contrary to her testimony in chief he could not have told her that he and his wife had bought it. 8. Needless to say, had the property been acquired by them during coverture, it would have been registered, in the name not of "Francisco Soriano, married to Tomasa Rodriguez," but of the spouses "Francisco Soriano and Tomasa Rodriguez." In Litam vs. Espiritu, the words 'married to Rafael Litam' written after the name of Marcosa Rivera, in each of the above mentioned titles are merely descriptive of the civil status of Marcosa Rivera, the registered owner of the properties covered by said titles. 9. It is difficult to believe also that Sorianos did not know then of the mortgage constituted by Francisco Soriano, on October 8, 1951, in favor of the RFC. In fact, Rosalina Soriano testified that month, Francisco Soriano and she conferred with the plaintiff, he stated that the Parañaque property was mortgaged to the RFC, her father got angry at the plaintiff and said that he had fooled him (Francisco Soriano). Being aware of said mortgage since October 1951, the Sorianos did not question its validity until January 12, 1957, when they filed in this cage their 3rd -party complaint in intervention as regards, at least, 1/2 of the Parañaque property, which they now claim to be their mother's share in the conjugal partnership. Worse still, after the foreclosure sale in favor of the RFC, they tried to

redeem the property for P14,000, and, when the RFC did not agree thereto, they even sought the help of the Office of the President to effect said redemption. 10. Their failure to contest the legality of the mortgage for over five (5) years and these attempts to redeem the property constitute further indicia that the same belonged exclusively to Francisco Soriano, not to the conjugal partnership with his deceased wife, Tomasa Rodriguez. Apart from the fact that said attempts to redeem the property constitute an implied admission of the validity of its sale and, hence, of its mortgage to the RFC ,there are authorities to the effect that they bar the Sorianos from assailing the same.

PNB vs. CA, 153 SCRA 435 (1987) Author: Jackie FACTS: 1. Clodualdo Vitug first marriage was with Gervacia Flores with whom he had 3 children. His second wife is Donata Montemayor with whom he had 8 children. 2. Clodualdo Vitug died intestate on May 20,1929 so his estate was settled and distributed in Special Proceeding wherein Donata Montemayor was the Administratrix. 3. On November 28, 1952, Donata Montemayor, through her son, Salvador M. Vitug, mortgaged to the Philippine National Bank (PNB) several parcels of land covered

by TCT No. 2289 (in the name of Montemayor) located in Pampanga to guarantee the loan granted by the PNB to Salvador Jaramiila and Pedro Bacani in the amount of P40,900.00 which was duly registered in the Office of the Register of Deeds of Pampanga. 4. On December 1, 1963, Donata Montemayor also mortgaged in favor of PNB certain properties covered by TCT Nos. 2887 and 2888 (in the name of Montemayor), Pampanga to guarantee the payment of the loan account of her son Salvador Vitug in the amount of P35,200.00, which mortgage was duly registered in the Register of Deeds of Pampanga. ● Salvador Vitug failed to pay his account so the bank foreclosed the mortgaged properties covered by TCT Nos. 2887 and 2888. At the public auction, PNB was the highest bidder. The titles thereto were thereafter consolidated in the name of PNB. ● Likewise, Salvador Jaramilla and Pedro Bacani failed to settle their accounts with the PNB so the latter foreclosed the properties covered by TCT No. 2889 which were sold at public auction and likewise PNB was the buyer thereof. On August 30, 1968, a certificate of sale was issued by the Register of Deeds covering said properties in favor of the PNB. ● When the title of the PNB was consolidated a new title was issued in its name ● On September 2,1969, the PNB sold the properties covered by TCT Nos. 2887 and 2888, Pampanga to Jesus M. Vitug, Anunciacion V. de Guzman, Prudencia V. Fajardo, Salvador Vitug and Aurora V. Gutierrez

in those names the corresponding titles were issued. 5. Meanwhile, on May 12, 1958, Donata Montemayor executed a contract of lease of Lot No. 24, which is covered by TCT No. 2887-R in favor of her children Pragmacio and Maximo both surnamed Vitug. This lease was extended on August 31, 1963. By virtue of a general power of attorney executed by Donata Montemayor on Sept. 19, 1966 in favor of Pragmacio Vitug, the latter executed a contract of lease on Sept. 19, 1967 of the said lot in favor of Maximo Vitug. 6. On March 21, 1970 Pragmacio Vitug and Maximo Vitug filed an action for partition and reconveyance with damages in the Court of First Instance of Pampanga against Marcelo Mendiola, special administrator of the intestate estate of Donata Montemayor et al, and PNB ● The subject of the action is 30 parcels of land which they claim to be the conjugal property of the spouses Donata Montemayor and Clodualdo Vitug of which they claim a share of 2/11 of 1/2 thereof. They assailed the mortgage to the PNB and the public auction of the properties as null and void. They invoked the case of Vitug vs. Montemayor, L5297 decided by this Court on Oct. 20, 1953 which is an action for partition and liquidation of the said 30 parcels of land wherein the properties were found to be conjugal in nature. ● DISMISSED. APPEAL TO THE CA. CA REVERSED AND SET ASIDE LC. 7. Hence this petition

ISSUE: Does the presumption of conjugality of properties acquired by the spouses during coverture provided for in Article 160 of the Civil Code apply to property covered by a Torrens certificate of title in the name of the widow? HELD: NO. When the subject properties were mortgaged to the PNB they were registered in the name of Donata Montemayor, widow. Relying on the torrens certificate of title covering said properties the mortgage loan applications of Donata were granted by the PNB and the mortgages were duly constituted and registered in the office of the Register of Deeds. The PNB had a reason to rely on what appears on the certificates of title of the properties mortgaged. For all legal purposes, the PNB is a mortgagee in good faith for at the time the mortgages covering said properties were constituted the PNB was not aware to any flaw of the title of the mortgagor.

RATIO: a. In processing the loan applications of Donata Montemayor, the PNB had the right to rely on what appears in the certificates of title and no more. On its face the properties are owned by Donata Montemayor, a widow. The PNB had no reason to doubt nor question the status of said registered owner and her ownership thereof. Indeed, there are no liens and encumbrances covering the same. b. The well-known rule in this jurisdiction is that a person dealing with a registered land has a right to rely upon the face of the torrens certificate of title and to dispense with the need of inquiring further, except

when the party concerned has actual knowledge of facts and circumstances that would impel a reasonably cautious man to make such inquiry. c. A torrens title concludes all controversy over ownership of the land covered by a final degree of registration. Once the title is registered the owner may rest assured without the necessity of stepping into the portals of the court or sitting in the mirador de su casa to avoid the possibility of losing his land. d. "Art. 160, NCC. All property of the marriage is presumed to belong to the conjugal partnership, unless it be proved that it pertains exclusively to the husband or to the wife." ● The presumption applies to property acquired during the lifetime of the husband and wife. In this case, it appears on the face of the title that the properties were acquired by Donata Montemayor when she was already a widow. When the property is registered in the name of a spouse only and there is no showing as to when the property was acquired by said spouse, this is an indication that the property belongs exclusively to said spouse. And this presumption under Article 160 of the Civil Code cannot prevail when the title is in the name of only one spouse and the rights of innocent third parties are involved. e. At any rate, although actions for recovery of real property and for partition are real actions, however, they are actions in personam that bind only the particular individuals who are parties thereto. The PNB not being a party in said cases is not bound by the said

decisions, Nor does it appear that the PNB was aware of the said decisions when it extended the above described mortgage loans. Indeed, if the PNB knew of the conjugal nature of said properties it would not have approved the mortgage applications covering said properties of Donata Montemayor without requiring the consent of all the other heirs or coowners thereof. Moreover, when said properties were sold at public auction, the PNB was a purchaser for value in good faith so its right thereto is beyond question. Solid State Multi-Products Corp. vs. CA, 196 SCRA 630 (1991) Author:

Facts: 1982 – pet, a domestic corporation, filed an action for quieting of title against the resp estate of Virata alleging that it is the registered owner of a parcel of land located at Imus, Cavite, with an area of 48,182 sq. meters, covered by a Certificate of Title No. which was issued in 1976; that Virata, during his lifetime thru the use of fraud, caused the issuance of a Certificate of Title in 1959 thru an administrative reconstitution of a nonexistent original title covering the same parcel of land; that by reason of the said reconstitution and subsequent issuance of TCT in favor of Virata, there now exists a cloud on the title of pet According to the pet’s evidence –

● Pursuant to Act No. 32 [law on sale of Friar Lands], Peñaranda [predecessor-ininterest] submitted with the Bureau of Lands an application to purchase a friar land. The application covers Lot No. 7449 containing an area of a little over 4 hectares. Said application was accompanied by a "SALAYSAY" signed and sworn to by one Mabini Legaspi purporting to transfer to, and to waive in favor of, Peñaranda, all the rights of executor to Lot No. 7449 ● Chief of Land Management Division forwarded to the Secretary of Agriculture and Natural Resources, the application of Peñaranda, recommending that Lot No. 7449 be sold to said applicant w/o public auction for a sum of P1,198.00. The application of Peñaranda was returned by the Secretary of Agriculture and Natural Resources, to the Director of Lands, approving that sale without auction, to Peñaranda, of lot No. 7449. Pursuant to this approval, the Director of Lands and Julian Peñaranda executed, therefore, Sales Contract in 1969, for a consideration of P1,198.00, to be paid in 10 monthly installments, w/c was fully paid in Aug., 1969

● The Undersecretary of Agriculture and Natural Resources issued the final deed of conveyance of lot No. 7449 in favor of Peñaranda ● On the basis of said Deed of Conveyance, the Register of Deeds of Cavite issued in Nov., 1969 in favor of Peñaranda a TCT, and in 1976, the pet, by way of a Deed of Absolute Sale bought said Lot No. 7449 as a consequence of which, TCT was issued to the pet ● Pet enrolled Lot No. 7449 with the issuance of Tax Declaration and continued to religiously pay the realty taxes and the subject property is in its actual possession since its acquisition from Peñaranda up to the present. Accdg. to resp’s evidence – ● In 1943, the Director of Lands gave authority to sell at public auction Lot No. 7449 at the price of not less than P290.00. In the same year, the Bureau of Friar Lands Agent issued a Notice fixing the public auction of Lot No. 7449, among others, on May 5, 1943. On said date, Mabini Legaspi [resp’s predecessor-in-interest] submitted a winning bid of P290.00. The subsequent installments were paid respectively evidenced by Official Receipts

● The Register of Deeds of Cavite issued a TCT to Mabini Legaspi who held ownership of the property up to 1957 when he executed a Deed of Sale transferring it to resp Virata. The deed was registered with the Registry of Deeds in the same year and on that same day, the Register of Deeds issued TCT to resp Virata ● However, in 1959, the Provincial Capitol building of Cavite which housed the Registry of Deeds was burned, destroying land records and titles in the registry among which were the records relating to Lot No. 7449 ● In September, 1959, the Registry of Deeds administratively reconstituted the original of resp’s TCT ● The TCT issued in the name of pet in 1976 came to the knowledge of resp in 1978 when he received a subpoena from the NBI in connection with its investigation of the conflicting land titles on Lot No. 7449. Resp presented Mabini Legaspi as his witness. Mabini Legaspi in her sworn testimony declared, among others, that she did not sell the land to Peñaranda, nor waived her right over the land in his favor Trial Court ruled in favor of resp; CA affirmed; hence, this pet

Issue: who is the rightful/lawful owner of the parcel of land in question Held: Pet Solid State Multi-Products Corp.; TC & CA rulings reversed Ratio: It is undisputed that the land involved in this case is a friar land and that the laws which are applicable are Act No. 1120, [Friar Lands Act] providing for the administration and temporary leasing and sale of certain haciendas and parcels of land, commonly known as friar lands, and Commonwealth Act No. 32 as amended by Commonwealth Act No. 316, which provided for the subdivision and sale of all the portions of the friar lands estate remaining undisposed of From the pertinent provisions of the said laws, the Bureau of Lands shall first issue a certificate stating therein that the gov’t has agreed to sell the land to such settler or occupant. The latter then shall accept the certificate and agree to pay the purchase price and in the installments and at the interest specified in the certificate. The purchaser becomes the owner upon the issuance of the certificate of sale in his favor subject only to the cancellation thereof in case the price agreed upon is not paid Upon the payment of the final installment, the gov’t shall then issue a final deed of conveyance in favor of the purchaser. However, the sale of such friar lands shall be valid only if approved by the Secretary of Interior as

provided in Act No. 1120. Later laws, however, required that the sale shall be approved by the Secretary of Agriculture and Commerce. In short, the approval by the Secretary of Agriculture and Commerce is indispensable for the validity of the sale. Pet’s predecessor, Peñaranda was the actual occupant of Lot 7449 when he filed his application to purchase the said lot in 1968; the Secretary of Agriculture and Natural Resources approved the sale of the lot w/o auction to Peñaranda; that a sales contract was executed between the Director of Lands and Peñaranda for a consideration of P 1,198.00 payable in 10 monthly installments; that upon the full payment of the price, the Undersecretary of Agriculture and Natural Resources issued the final deed of conveyance in favor of Peñaranda. Subsequently, the Register of Deeds of Cavite issued a TCT in the name of Peñaranda, and when the latter sold the land to pet, former’s TCT was cancelled and TCT was issued in favor of the latter. Clearly, the purchase of the friar land made by Peñaranda was in compliance with law On the other hand, nowhere in the evidence for the resp would show that a certificate of sale was ever issued by the Bureau of Lands, which would vest ownership and title over the land in favor of Mabini Legaspi. The acquisition of the lot by Legaspi was highly irregular and void, and not in compliance with the procedure mandated by law for the sale of friar lands. For one thing, Mabini

Legaspi allegedly purchased the land in a sale at public auction, which procedure is nowhere provided in the applicable laws. The laws expressly state that an actual occupant of the land shall purchase the lot occupied by him at a private sale and not in a sale at public auction [Sec. 2, C.A. 32 as amended]. Further, neither was there any deed of conveyance issued to Legaspi by the gov’t after the full payment of the installments on the disputed lot. There was neither allegation nor proof that the sale was with the approval of the Secretary of Agriculture and Commerce. The absence of such approval made the supposed sale null and void ab initio. The issuance of a certificate of title in favor of Mabini Legaspi did not vest ownership upon her over the land nor did it validate the alleged purchase of the lot, which is null and void. Although a period of 1 year has already expired from the time the certificate of title was issued to Mabini Legaspi pursuant to the alleged sale from the gov’t, said title does not become incontrovertible but is null and void since the acquisition of the property was in violation of law. Further, the petitioner herein is in possession of the land in dispute. Hence, its action to quiet title is imprescriptible. Being null and void, the sale made to Mabini Legaspi and the subsequent titles issued pursuant thereto produced no legal effects whatsoever. Even assuming that resp was a purchaser in good faith and for value, the law is, as b/w 2 persons both of whom

are in good faith and both innocent of any negligence, the law must protect and prefer the lawful holder of registered title over the transferee of a vendor bereft of any transmissible rights. Further if a person happened to obtain property by mistake or to the prejudice of another with or without bad faith, the certificate of title w/c may have been issued to him under the circumstances may and should be cancelled or corrected.

Villanueva vs. CA, 198 SCRA 472 (1991) Author: Banico Facts: The present case assails the decision of the CA in reversing the decision of the RTC, which the latter court dismissed the complaint for the annulment of the deed of sale. The CA found that the signature of the vendor in the deed of sale was forged. Catalina Sanchez (private respondent) claimed to be the widow of Roberto Sanchez (vendor). Catalina then claimed that her husband is the owner of a 275 sq. meter parcel of land in Rosario Cavite, which was registered in the names of Sps. Villanueva (petitioners) without her knowledge and an alleged deed of sale. On a report by the Philippine Constabulary (PC) it was showed that the signature of Roberto was forged. She now prays for the annulment of the deed of sale. On the part of the petitioners, Sps. Villanueva questions the personality of the Catalina, contending that Roberto was never married, but had a common-law wife, which he had 2 illegitimate children. They also claim the Roberto signed over the deed to them in

1968 for the sum of P500 as partial payment of a judgment they obtained against him. During the trial, the RTC then required that the document be investigated by the NBI, as requested by petitioners. The NBI had the same findings, claiming that the signature was not done by the same person. The RTC ruled in favor of the petitioner, rejecting the findings of both the PC and the NBI. It was reasoned that the difference in the signature may be caused by Roberto being "under serious emotional stress and intensely angry" when he reluctantly signed the document after he had lost the case to them". It was also stated that Roberto did not do anything to annul the deed of sale, thus the action has already prescribed. However, the CA reversed the decision of the RTC and ruled in favor of the respondent. Issue: WoN the CA erred in reversing the decision of the RTC and annulling the deed of sale? Ruling: No, the CA did not commit reversible error. The SC affirms the decision of the CA. Catalina Sanchez has proved that she is the widow of Roberto by submitting her marriage contract. It was rendered unnecessary the presumption that "a man and a woman deporting themselves as husband and wife have entered into a lawful contract of marriage" and may also explain why Roberto Sanchez could not marry the woman by whom he supposedly had two illegitimate children. It was error on the part of the RTC to reject the evidence of a marriage contract and held the validity of the Transfer Certificate Title describing Roberto to be “single”, disregarding the principle that the best evidence of a marriage is the marriage contract.

Going to the expert testimonies of both the PC and the NBI, it was significant that even though it was petitioners who requested the examination of the NBI, it was respondent who presented it as her own witness. It is clear that petitioners thought that that the NBI’s findings would refute the PC’s examination, however, the findings coincide with one another. They did not conjure this conclusion out of thin air but supported it with knowledgeable testimony extensively given on direct and cross-examination on the various characteristics and differences of the signatures they had examined and compared. The Court itself examined the signatures of Roberto in different instruments, and is also inclined to accept the findings of the experts. For the reason that the difference was because Roberto was "under serious emotional stress and intensely angry", petitioners were not able to establish for such reason, and it was only conjecture on the part of the RTC. Petitioners also were not able to properly explain why it took them 13 years before they could have filed for the registration of the deed of sale. They explain that they were mere peasants and did not appreciate the significance of the immediate transfer of the property in their names. However, the evidence support that the petitioners understood the importance of the immediate registration since it was for the purpose of using it as collateral in case they wanted to borrow money. Also, for the claim of prescription, petitioner invoke that the CA erred in not declaring the action to have prescribed. The SC ruled that the applicable rule is not Art. 1391 but Art. 1410 of the Civil Code. Art. 1410 provides that "the action or defense for the declaration of the inexistence of a contract does not prescribe”.

Finally, petitioners invoke that Art. 1431 of the Civil Code, contending that the respondent is estopped from questioning the deed of sale. The conclusion of petitioner that private respondent had knowledge of the transaction, is not supported by evidence on record. Also, the Court does not see the connection of Art. 1431, which provides that "through estoppel an admission or representation is rendered conclusive upon the person making it and cannot be denied or disproved as against the person relying thereon” at the present case. Avila vs. Tapucar, 201 SCRA 148 (1991) Author: TANG SUMMARY & READ “KAHIT ETO LNG BASAHIN NIYO PORTION FOR EASY UNDERSTANDING” ● Bahan applied for a free patent registration on a certain property ● In the free patent application included another person’s property - hence enlarging their own property through such erroneous inclusion. ● As such obviously (petitioner) Avila’s got angry why was their said property subject to another person’s land registration (Bahan’s free patent application) ● Bahan’s free patent application was granted - hence they are invoking indefeasibility of title because they already had a valid registration, as evidence of ownership ● Avila questions such whether or not registration is valid , because their title was erroneously included in Bahan’s free patent registration ● Court ruled in favor of Avila -The evidence shows that Free Patent No. 552571 issued to the Bahans is

erroneous as it embraced and comprised in portions thereof lands which belong to the Avilas. Facts: Acquisition ●

In 1918, spouses Pedro Bahan and Dominga Exsaure acquired a parcel of land situated at Tabangao, Victory, Tubay, Agusan del Norte, which is more particularly described as follows: ● A parcel of coconut land containing an area of 1.8340 has. (now reduced to 1.3485 due to road) covered by Tax Dec. No. 270, bounded on the North by Anastacio Luyahan, on the East and South by Tabangao Creek and on the West by Tomas Colon, assessed in the amount of P330.00 Inheritance ● In 1965, said property was inherited by private respondents Julito Bahan, Cristina Bahan-Panis, Lucita Carters, Boy Cartera and Candelaria Bahan-Mendoza as successors-in-interest. Avila’s purchase of Property ● On October 11, 1960, petitioner Magdalena Avila (then Mrs. Magdalena R. Vda. de Leon) bought a parcel of land situated at Tabangao, Victory, Tubay, Agusan del Norte, containing an area of 4,371 square meters more or less from Luis Cabalan and his wife under a Deed of Absolute Sale of Unregistered Land and under Tax Declaration No. 3055. Filing of free patent (Bahan Heirs)

●

On November 3, 1971, the heirs of Pedro Bahan, represented by Julito Bahan filed Free Patent Application No. (IX-2) 10144 for an area of 2.2400 hectares of Lot No. 2383, Pls-736 which lot has a total area of 6.9027 hectares in its entirety. Deputy Public Land Inspector Francisco C. Baylen in his report, dated November 28, 1971 stated that the heirs of Pedro Bahan represented by Julito Bahan, have cultivated only 2.2500 hectares of land applied for and consequently, he did not recommend the issuance of the patent. Said report was erroneously forwarded to the Bureau of Lands by then Acting Assistant District Land Officer of Butuan City dated December 23, 1971, recommending the issuance of patent therefor. Alleged farming of Bahan in Avila’s said property ● In May 1973, private respondent Julito Bahan together with ten persons who were alleged to be members of the Free Farmers Federation, gathered coconuts from the land purchased by petitioner Magdalena Avila but was intercepted by the Chief of Police of Tubay, Agusan del Norte. Bahan’s act of quieting the title ● On June 27, 1973, private respondents Bahans filed an action for quieting of title and damages with the Court of First Instance of Agusan del Norte and Butuan City, Branch I docketed as Civil Case No. 1585 entitled "Julito Bahan, Cristina Bahan-Panis, Lucita Carters, Boy Carters, Candelaria Bahan-Mendoza, Alfreda Pol, in her own behalf and in behalf of her minor children: Carmencita, Oscar, Julia, Julita and Gervacio, Jr., all surnamed Bahan versus Ludovico Avila (Mariano Avila) and Magdalena Avila" alleging that they were the

successors-in-interest of "a parcel of coconut land containing an area of 1.8340 has. (now reduced to 1.3485 due to the road)" and that sometime in 1968, he discovered that the northwestern portion of said land containing an area of about 1/3 of a hectare was already in the possession of the Avilas; and the latter were harvesting the fruits of about 40 coconut trees found therein. The Bahans prayed that the petitioners Avilas be ordered to pay the Bahans the sum of not less than P1,800.00 a year from the time they took possession of the aforesaid property until the possession thereof is restored to them. Avila’s defense of purchase of title and adverse possession ● In their answer, the petitioners Avilas raised the defense that on October 11, 1960, Magdalena Avila purchased a parcel of land situated at Tabangao, Victory, Tubay, Agusan del Norte, containing an area of 4,371 square meters more or less from Luis Cabalan and from then on has been in open, continuous, public, peaceful and uninterrupted possession of the same. Bahan’s application of a free patent was granted ● In the meantime, private respondents Bahans' application for free patent was approved for 6.9027 hectares and Free Patent No. 552571 was issued on December 6, 1973. Original certificate of title No. P8424 was issued in the name of the Heirs of Pedro Bahan, represented by Julito Bahan on the same date. KAHIT ETO LNG BASAHIN NIYO ● On October 17, 1974, the Avilas filed an administrative protest against the Bahans before the Bureau of Lands docketed as B.L. Claim No. 872 (N) DLO Lot No. 2383

Tabangao, Doña Rosario, Tubay, Agusan del Norte, entitled "Mariano P. Avila and Magdalena R. Avila, Claimants-Protestants versus F.P.A. No. (IX-2) 10144 (Patent No. 552571) Heirs of Pedro Bahan, represented by Julito Bahan, Applicant-Respondent" for having erroneously included their land under the issued free patent and Original Certificate of Title, which protest was filed 11 months after the issuance of the patent and 7 months and 3 days after the registration of the Certificate of Title in the Registration Book of the Register of Deeds, Agusan del Norte. Judge Tapucar ruled in favor of Bahan - citing indefeasibility of title as a valid defense Issue: W/N Bahan’s defense of having a valid decree of registration over the said free patent was valid (the one having an erroneous inclusion of Avila’s property , hence enlarging Bahan’s own property) Held:NO- Bahan’s erroneous inclusion of Avila’s title in the former’s successful free patent application does not make the former the owner of the latter’s property Registration does not vest title. It is not a mode of acquiring ownership but is merely evidence of such title over a particular property. It does not give the holder any better right than what he actually has, especially if the registration was done in bad faith. The effect is that it is as if no registration was made at all Ratio: ● Sa usapin sa lupa , kunin lng ang nararapat sayo, wag kunin ang nakatakda sa ibang tao, kahit anong gawin mo , hindi mo yan makukuha.

●

It is axiomatic in this jurisdiction that "while land registration is a proceeding in rem and binds the whole world, the simple possession of a certificate of title under the Torrens Systems does not necessarily make the holder a true owner of all the property described therein. If a person obtains a title under the Torrens system, which includes by mistake or oversight land which can no longer be registered under the system, he does not, by virtue of the said certificate alone, become the owner of the lands illegally included

Foja Vs. Court of Appeals, 75 SCRA 441 (1977) Author: John Briones Facts: 1. Levin Frial filed with the Court of First Instance of Capiz Branch 3, situated in Mambusao, Capiz, a complaint for Recovery of Possession and damages, for a parcel of land located in Barrio San Agustin, Dumalag, Capiz, w/ area of 235, 854 square meters more or less, ( OCT No. RO-1496), named under Indalecio Frial, father of Levine Frial; 2. Levine Frial came to know that Felipa Faja was occupying the property, Frial demanded its return, however, Faja declined; 3. Thus, Frial filed a complaint for recovery of possession of the land in question, and the unearned income from the land for a period of not less than 30 years, at around P150, 000.00; 4. Faja, in her answer, denied under oath the allegations in the complaint as to the ownership of Frial, in her defense, Faja claimed she is the lawful owner and in actual possession of the property, which is identical to Lot No. 4010 of the Cadastral Survey of Dumalag, Capiz, which she inherited from her father, Marcelino Faja; and argues the ff:

Faja argues that she and her predecessors in-interest have been in possession of the property publicly, peacefully, continuously and adversely, in the concept of owners, for more than 60 years, with tax declarations in the name of her father, Marcelino Faja and taxes have been paid ever since then; Faja further explains that she herself lives on the land in question, and that the same is planted with coconut trees, mangoes, bananas, santol, buri, while around 8 hectares are for rice and corn; Faja also argues that Levin Frial and his father, Indalecio Frial, NEVER LIVED nor possessed the said property, “ EVEN FOR A SINGLE MOMENT.” Faja also argues that any Certificate of Title secured by Indalicio Frial was obtained through FRAUD, DECEIT, and MISREPRESENTATION.

6. Frial, denied the fraud claim against his father; and alleged that Faja’s right to question the validity of the Title had PRESCRIBED; 7. Responsive pleadings filed, pre-trial conference ensued, Judge Leonidas order parties to submit a memoranda, whether or not SUMMARY JUDGMENT may be issued on the basis of the pleadings, since there were only 2 issues to be resolved; a. can a registered owner who has acquired title thereto for almost 35 years still recover possession from actual occupants who claim long and continuous possession of same property but w/out title;

b. is reconveyance of titled property still legally possible considering that a period of more than 10 years had elapsed since the issuance of the decree of registration; 8. Subsequently, Felipa Faja in her memorandum argued that summary judgment should be DENIED, as there was genuine controversy between the partieswhich required a trial on the merits, and that the alleged prescription of her counterclaim for reconveyance cannot be subject of a summary judgment, notwithstanding the fact that her cause of action for reconveyance to her of the property only arose from the moment she was served the copy of the compliant which was 1975; 9. However, TRIAL COURT: Trial Judge ruled in favor of Levin Frial, and against Faja. Trial Court ruled that there was NO GENUINE ISSUE AS TO MATERIAL FACT, except to amount of damages, SUMMARY JUDGMENT was declared in favor of Frial. 10. MR was filed by Faja, denied, subsequently, Faja died, her children now herein, all surnamed Gardose, substituted her, and filed with the Court of Appeals a petition for Certiorari; 11. Court of Appeals AFFIRMED the summary judgment, NO GENUINE ISSUE as to any material fact, CA reasoned that the disputed property was covered by an OCT, and that any action to annul that title on the ground of fraud prescribes after the lapse of 10 years; ISSUE: W/N the trial court and the Court of Appeals was correct in their summary judgments HELD: NO, summary judgments set aside, the presiding judge of CFI Capiz, is directed to proceed with the trial on the merits.

RATIO: 1. Counterclaim of Felipe Faja for reconveyance of the litigated property has NOT PRESCRIBED. It is an established rule that an action to quiet title to property in the possession of plaintiff is IMPRESCRIPTIBLE. Here, Faja was in possession of the property since 1945-present, basically 30 years, her cause of action for reconveyance, which seeks to quiet title to the property in dispute, FALLS WITHIN THE RULE. More importantly, the period of prescription began to run against Felipa Faja, only from the time she was served with the copy of the complaint in 1975 giving her notice that property she was occupying was titled in the name of Indalecio Frial; 2. Settled jurisprudence provides that, one who is actual possession of a land claiming to be owner, may wait until his possession or his title be attacked, before taking steps to vindicate his right, his undisturbed possession gives him a continuing right to seek the aid of a court of equity, this can only be claimed by one who is in possession. Here, THIS RULE OF EQUITY strongly applies to Felipa Faja , who was in possession of the litigated property for no less than 30 years and was suddenly confronted with a claim that her land which she was occupying and cultivating was titled to someone else; 3. This Court rules that the right to seek reconveyance and annul the certificate of title to the property, ACCRUED ONLY from the time the one in possession was made aware of the adverse claim, the time of knowledge will be the reckoning

point that the statutory period of prescription will run against the possessor; 4. The existence of Certificate of Title in the name of Frial’s father is NOT CONCLUSIVE, because there are allegations of fraud; 5. This Court regrets the summary dismissal, because there exists MATERIAL FACTS, to be inquired, into and resolved on the basis of evidence adduced by the parties: a) circumstances which led to the issuance of OCT in 1950 in favor of Frial b) explanation, if any, of Frial’s INACTION, and his heirs, for a period of 30 years to take possession of land in question c) claim of ownership of Faja Ergo, all these matters cannot simply be summarily disposed of in favor Frial. 5. This Court, desires to the encourage trial courts to take advantage of and apply provisions of Rules of Court on Summary Judgments for expeditious disposition of cases, however, as stated in the case of Constantino vs. Hon. Estenzo, the rule on summary judgment can only be entertained where there are no questions of fact in issue or where material allegations of the pleadings, Are not disputed. xxx the demands of a fair, impartial and wise administration of justice call for a faithful adherence to legal precepts on procedure which ensure litigants the opportunity to present their evidence

and secure a ruling on all issues presented in the respective pleadings. SHORTCUTS IN JUDICIAL PROCESS ARE TO BE AVOIDED, where they impede, rather than promote a judicious dispensation of justice.

The Philippine National Bank opposed the petition because it was the mortgagee of said lots which were later extrajudicially foreclosed, with the PNB itself as the highest bidder at the foreclosure sale.

TEEHANKEE, J., concurring. Respondent court failed to appreciate that these are vital genuine issues of fact which would materially affect the outcome of the case and therefore gravely erred in ruling that summary judgment is proper as there is no genuine issue as to any material fact.

The facts are not disputed. Datu Binasing was the owner of the said four lots pursuant to which four original certificates of titles were issued in his name. On July 23, 1938, he sold said lots to Soledad C. de Teruel. The deed of sale was registered in the office of the Register of Deeds and the corresponding Transfer Certificates of Title were accordingly issued in her name. The Office of the said Register of Deeds was burned during

Register of Deeds vs. PNB, 13 SCRA 46 (1965)

the Pacific War and the records, among them, the original

Author:

certificates of title in the name of Datu Binasing covering said

Facts: This appeal originated from a petition filed by the Register of Deeds of Cotabato in Cadastral Case. He prayed that original certificates of title in the name of Datu Sinarimbo Binasing, be ordered cancelled on the ground that they had been issued erroneously; that Datu Binasing had secured the said titles upon false representations in an affidavit wherein he alleged that he had never, to his knowledge, secured titles for said lands.

four lots were destroyed. In 1947, Datu Binasing secured certified copies of the aforesaid decrees from the General Land Registration Office. And on the strength of these copies and an affidavit stating that he had not at anytime secured certificates of title for said fours lots, the said Register of Deeds on August 8, 1947, issued in the name of Datu Binasing, original certificates of title. Thereafter, said Datu obtained from the Philippine National Bank, a loan of P10,000.00, and he gave as security

the said lots and some other properties. On March 20, 1954, the mortgage was extrajudicially foreclosed.

Held: No Ratio: Datu has other properties that the bank can use to

Soledad C. de Teruel, on the other hand, procured a

enforce its loan against Datu. On the other hand, the Supreme

reconstitution of her transfer certificates of title, in lieu thereof,

Court ruled that the Torrens issued to Datu in 1947 could not

Transfer Certificates of Title were issued in her name.

prevail over the Torrens issued to de Teruel in 1938. The

Having discovered this state of affair (two different certificates of title for each of said four lots, and in the name of two different persons), the Register of Deeds filed the petition that gave rise to this appeal. Lower court: directed the said Register of Deeds to cancel original certificates of title issued in the name of Datu, and declared valid and subsisting the Transfer Certificates of Title issued in the name of Soledad C. de Teruel.

theory of indefeasibility of titles under the Torrens System, states that the indefeasibility of title thereunder could be claimed only if a previous valid title to the same parcel of land does not exist. Where issuance of the title was attended by fraud, the same cannot vest in the titled owner any valid legal title to the land covered by it; and the person in whose name the title was issued cannot transmit the same, for he (Datu) has no true title thereto. This ruling is a mere affirmation of the recognized principle that a certificate is not conclusive

The Philippine National Bank appealed contending that being

evidence of title if it is shown that the same land had already

an innocent mortgagee for value, it is entitled to protection

been registered and that an earlier certificate for the same

under Sec. 55, Act 496 as amended; that in the case of

land is in existence.

Blondeau vs. Nano and Vallejo, a mortgagee (relying upon a Torrens title in good faith and unaware that fraud had been Martinez vs. CA, 56 SCRA 647 (1974) Author: Corpuz

committed by forgery) was protected. He cites other cases holding that the innocent purchaser for value may take good title, notwithstanding defects of the mortgagor’s title deeds. Issue: Whether or not to give due weight to the mortgage executed by Datu in favor of PNB.

FACTS:

1. Spouses Martinez are the registered owners of Lot Nos. 1 and 2 located in Lubao, Pampanga. Both parcels of land are fishponds. The subject property is Lot No. 2. 2. It was originally owned by Paulino Montemayor. When he died, he passed it to his successors-in-interest, who in turn, sold both properties to a certain Potenciano Garcia. 3. Garcia was prevented by then municipal president of Lubao from restoring the dikes constructed on the contested property, so he filed a civil case with the CFI. 4. CFI declared a permanent preliminary injunction, which was affirmed by SC. So since 1914, the dikes around the property remained closed until a portion thereof was again opened just before the outbreak of the Pacific War. 5. In 1925, Garcia applied for the registration of both parcels of land in his name, which was granted by CFI Pampanga. Hence, an OCT was issued to Garcia and his wife. 6. These parcels of land were eventually acquired by herein spouses Martinez (7th purchaser). 7. They referred the issue on dikes to the Committee on Rivers and Streams who appointed a Sub-Committee to investigate the case and to conduct an ocular inspection of the contested property. The Sub-Committee submitted its report stating that Parcel No. 2 was not a public river but a private fishpond owned by spouses Martinez. Thereafter, the Committee on Rivers and Streams then rendered its decision in favor of spouses Martinez. 8. The municipal officials of Lubao refused to recognize the aforementioned decision because spouses Martinez also instituted a civil case, before the CFI of Pampanga, against Mayor Zagad who prevented them from constructing dikes. Mayor Zagad appealed the injunction suit to SC. SC dismissed the petition so spouses Martinez

proceeded to construct the dikes in the disputed parcel of land. 9. 4 years later, while the civil case against Mayor Zagad was still pending, then Secretary of Public Works and Communications ordered another investigation of the said parcel of land, directing the spouses to remove the dikes they had constructed pursuant to the authority granted to him by RA 2056. Otherwise, the dikes would be demolished within thirty (30) days. 10. Spouses Martinez filed the present case, which was decided in their favor by the lower Court. 11. CA, on appeal, reversed CFI’s decision stating that Lot No. 2 is a public stream so the title should be cancelled and the river covered reverted to public domain. Hence, this petition. ISSUE: WON CA erred in declaring Lot No. 2 as a public river and ordering the cancellation of its registration because this constitutes a collateral attack on a Torrens Title in violation of the law. HELD: NO. The incontestable and indefeasible character of a Torrens certificate of title does not operate when the land covered thereby is not capable of registration. CA affirmed. RATIO: 1. The technical description of both Lots Nos. 1 and 2 confirms the fact that Lot No. 2 is practically bounded by rivers on all sides. Lot No. 2 is a branch of the main river that has been covered with water since time immemorial and, therefore, part of the public domain that is NOT

2.

3. 4.

5.

6.

7.

capable of private appropriation or acquisition by prescription. A person does not, by virtue of a certificate of title alone, become the owner of the land illegally included, such as those that cannot be registered under the Torrens system. (Ledesma v. Municipality of Iloilo) The right of reversion or reconveyance to the State of such public properties does not prescribe. Moreover, the Land Registration Court has no jurisdiction over non-registerable properties and cannot validly adjudge the registration of title in favor of a private applicant. When it comes to registered properties, the Secretary of Public Works & Communications has jurisdiction to order the removal or obstruction to navigation along a public and navigable creek or river included therein (R.A. 2056) Furthermore, appellants cannot be deemed purchasers for value and in good faith. They knew the condition of the land that they were buying and the restrictions that may be imposed by the government in connection with their project of converting Lot No. 2 into a fishpond. Nevertheless, they willfully and voluntarily assumed the risks attendant to the sale of said lot. One who buys something with knowledge of defect or lack of title in his vendor cannot claim that he acquired it in good faith. As a general rule, a purchaser of a registered property cannot go beyond the record to make inquiries as to the legality of the title of the registered owner, but may rely on the registry to determine if there is no lien or encumbrances over the same. However, it cannot be availed of as against the law and the accepted principle that rivers are parts of the public domain for public use

and not capable of private appropriation or acquisition by prescription.

Bornales vs. IAC, 166 SCRA 519 (1988) Author: Sarah Rosales Facts: 1. A parcel of land in Barrio Indayagan Pontevedra, Capiz, with an area of 774, 397 square maters was awarded to Sixto Dumulong who is married to Isabel Marquez. An original certificate of title was issued in his name. 2. Sixto and Isabel did not have a child. Subsequently, Sixto had an extramarital affair cohabited with Placida and they begot children. 3. In March 1978 (by this time Sixto is already dead), a "Deed of Extrajudicial Adjudication and Sale of Real Property", which was purportedly a settlement of the conjugal estate of Sixto Dumolong and Isabel Marquez Dumolong and the sale of said lot for P6,000.00 to spouses Carlito Patanao and Minda Dumolong and to spouses Bernardo Decrepito and Loreta Dumolong, was executed by Renito Dumolong (Son of Sixto and Placida) and by Isabel Marquez Dumolong whose supposed thumbmark appeared in the document. 4. The deed was registered and a transfer certificate of title was issued in favor of the spouses. 3 months later, the spouses sold the lot to Antonio and Florenda Bornales for 40,000 and they eventually secured a transfer certificate of title in their names. 5. Isabel Marquez filed an action for reconveyance and damages against Placida Dumolong, Renito Dumolong, spouses Carlito Patanao and Minda Dumolong, spouses Bernardo Decrepito and Loreto Dumolong, and spouses Antonio Bornales and Florenda Diaz for the alleged forgery

of the "Deed of Extrajudicial Adjudication and Sale of Real Property. 6. Bornales countered he was not aware of the fraudulent nature of the prior transactions, but since a Torrens was issued he should be considered as a buyer in good faith, hence entitled to some right.

private respondent sometime in 1980 to secure her signature and conformity to the Extra-Judicial Adjudication and Sale of Real Property.

Issue: Whether or not Bornales may invoke the indefeasibility of the torrens title Held: No. Ratio: Having bought the land registered under the Torrens system from Placida who procured title thereto by means of fraud, Bornales cannot invoke the indefeasibility of a certificate of title against Isabel to the extent of her interest therein. The Torrens system of land registration should not be used as a means to perpetrate fraud against the rightful owner of real property. Registration, to be effective, must be made in good faith. It is a settled rule that the defense of indefeasibility of a certificate of title does not extend to a transferee (Bornales) who takes it with notice of the flaws in his transferor’s (Placida’s) title. Thus, it is a settled rule that the defense of indefeasibility of a certificate of title does not extend to a transferee who takes it with notice of the flaws in his transferor's title. If at all, the petitioners only acquire the right which their vendors then had.

Arguelles vs. Timbancaya, 72 SCRA 193 (1976) Author: Bianca Dador The rule on the incontrovertible nature of a certificate of title applies when what is involved is the validity of the OCT, not when it concerns that of the TCT. Also, public policy demands that a person guilty of fraud or at least, of breach of trust, should not be allowed to use a Torrens title as a shield against the consequences of his own wrong doing. Facts:

The fact that petitioners have been the tenants/lessees of the land even during Sixto Dumolong's lifetime belies any alleged lack of knowledge. Having been the cultivators of the land, it is unimaginable that the petitioners would have been unaware of the transactions affecting the land. It appears that petitioners were aware that the private respondent was the legal wife of Sixto Dumolong and was a rightful heir to the properties of the latter. In fact, the trial court conclusively found that the petitioners themselves went to see the

Defendant Guillermo Timbancaya appeals directly and on purely questions of law the decision of Palawan CFI. The trial court ruled that the property, subject of plaintiff’s action for reconveyance and by virtue of a compromise agreement and judgment in Special Proceedings No. 211, was owned jointly one-half thereof by Caridad Arguelles and the other half by

Guillermo

and

Alberto

Timbancaya.

During the special proceedings for Intestate Estate of Jose Arguelles, the court rendered a decision, in conformity with a compromise agreement, adjudicating one half of the land to Arguelles and the other half to the Timbancaya’s. It also ordered both parties to pay for the coconut trees planted in their respective portions of the land, which they relinquish in favor of the other. Contrary to the agreement and judgment in the special proceedings however, Timbancaya was able to have the original certificate of title cancelled and have a new CT issued in his favor covering the whole land (June 5, 1961), despite Arguelles’ actual open and continuous possession of one half of the property even before the filing of the special proceedings. Upon knowing the issuance of the TCT, Arguelles filed the instant case for reconveyance (April 30, 1965). Timbancaya, for his part, alleges that Arguelles has no right to the property in question because she is not an heir of the estate of the late Jose Arguelles despite the decision in the special proceedings. Issue: W/N TCT had already become indefeasible, since almost four years have lapsed before action was filed Held: No. The rule that a decree of registration once issued

becomes final and incontrovertible 1 year after its issuance is not relevant to the case at bar. Ratio: Arguelles does not question the validity of the OCT but instead seeks the annulment of the TCT, which was issued to Timbancaya after the judgment by compromise and based on his misrepresentation in the Register of Deeds. Timbancaya had claimed that he and his brother are the exclusive owners of the property as the “only legitimate children and surviving heirs of (their) parents Jose Arguelles and Rufina de los Reyes”—a representation contrary to his previous admissions that “they are not the legitimate children of the deceased Spouses Jose Arguelles and Rufina de los Reyes, but the sons of Rufina de los Reyes with her first husband, Joaquin Timbancaya.” In this case, the action to annul the title or action for reconveyance has its basis in Section 55 of Act 496, which provides that “in all cases of registration procured by fraud the owner may pursue all his legal and equitable remedies against the parties to such fraud, without prejudice, however, to the rights of any innocent holder for value of a certificate of title.” This remedy is distinct from that authorized by Section 38, which has for its purpose the reopening of the decree of title, on the ground of fraud, within 1 year from its issuance. Judgment appealed from affirmed. Umbay vs. Alecha, 135 SCRA 427 (1985); but see Jimenez vs. Fernandez, 184 SCRA 190 (1990) Author: PANGANIBAN

● FACTS: This case is about the right of the heirs of the registered owner of a parcel of land with an area of 2,265 square meters to recover a portion thereof with an area of 500 square meters allegedly usurped by the adjoining owner. ● 1. Natalio Enanoria was the owner of Lot No. 5280 located in the mountain of Barrio Valencia, Carcar, Cebu. His title is an OCT issued in 1922. He dided in 1924. 2. His heirs asked a surveyor to relocate the lot. They discovered that its 500-square-meter portion was occupied by Placido Alecha, the owner of the adjoining Lot No. 5281 which is its southeastern boundary. 3. TC: ordered Alecha and his wife to vacate the said 500-square-meter portion. 4. Appellate Court: reversed that decision and dismissed the complaint of the Enanoria heirs. ISSUE: WON the Heirs of Enanoria has the right to recover the 500sqm portion of their lot? HELD: Yes. No prescription and laches. Neither can the Alecha acquire the land through prescription because it is covered by Torrens Title. RATIO: Sec 47 (P.S. 1529): no title to registered land in derogation to that of the registered owner shall be acquired by prescription or adverse possession

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Prescription is unavailing not only against the registered owner but also against his hereditary successors because the latter merely step into the shoes of the decedent by operation of law and are merely the continuation of the personality of their predecessor-in-interest the real purpose of the Torrens system is to quiet title to land and to stop forever any question as to its legality. "Once a title is registered, the owner may rest secure, without the necessity of waiting in the portals of the court, or sitting in the ‘mirador de su casa’, to avoid the possibility of losing his land." Adverse, notorious and continuous possession under a claim of ownership for the period fixed by law is ineffective against a Torrens title. Title to land can no longer be acquired by prescription after a Torrens title has been issued for it. The right to recover possession of registered land is imprescriptible because possession is a mere consequence of ownership

In this case, the petitioners’ action to recover the 500 square meters cannot be barred by the equitable defense of laches or delay because they because aware of the encroachment only after they hired a surveyor in 1963 to ascertain the true area and boundaries of Lot No. 5280. Laches presupposes waiver of one’s right. There was no waiver in this case. The petitioners, poor, ignorant rustics, never intended to renounce their right to the 500 square meters.

SEE ALSO: JIMENEZ v FERNANDEZ Author: PANGANIBAN

7. Sulpicia then instituted this action to recover the eastern portion of the property (436sqm). 8. TC: Grado (resp) is the absolute owner. Sulpicia appealed to CA, which affiremed the decision of TC; MR denied.

FACTS: The land in question is the Eastern portion with an area of Four Hundred Thirty Six (436) square meters of that parcel of residential land situated in Barrio Dulig (now Magsaysay), Municipality of Labrador, Pangasinan actually covered by TCT issued in the name of Jimenez. 1. Fermin Jimenez (formerly owns the parcel of land w/ an area of 2, 932 sqm) has 2 sons – Fortunato and Carlos. 2. Fortunato has one child – Suplicia Jimenez (petitioner). After death of Fermin, entire parcel of land was registered under Act 496 in the name of Carlos and Suplicia in equal shares pro-indiviso. 3. OCT was issued in their name. 4. Carlos died. His illegitimate daughter – Melecia Jimenez took possession of the eastern portion of the property consisting of 436 sqm. 5. Melecia sold the 436 sqm to Edilberto Cagampan and Teodora Grado (resp) w/ a contract (Exchange of Real Properties). 6. Petitioner Sulpicia executed an affidavit adjudicating unto herself the other half of the property appertaining to Carlos Jimenez, upon manifestation that she is the only heir of her deceased uncle. TCT was issued in Sulpicia’s name alone covering 2,932sqm.

ISSUE: WON Sulipicia is entitled to recover the eastern portion of the parcel of land? HELD: Yes. Sulpicia is not barred by laches. RATIO: [PRESCRIPTION and LACHES] ● CA relied on Arcuino case, concluded that respondents had acquired the property under litigation by prescription – UNTENABLE. ● since 1933 petitioner Sulpicia Jimenez was a title holder, the property then being registered in her and her uncle Carlos Jimenez' name. ● Melecia Cayabyab's possession or of her predecessors-in-interest would be unavailing against the petitioner Sulpicia Jimenez who was the holder proindiviso with Carlos Jimenez of the Torrens Certificate of Title covering a tract of land which includes the portion now in question ● No possession by any person of any portion of the land covered by said original certificate of titles, could defeat the title of the registered owner of the land covered by the certificate of title ● Sulpicia's ownership over her one-half of the land and which is the land in dispute was always covered by a Torrens title, and therefore, no amount of possession thereof by the respondents, could ever defeat her

●

proprietary rights thereon. It is apparent, that the right of plaintiff (now petitioner) to institute this action to recover possession of the portion of the land in question based on the Torrens Title of Sulpicia Jimenez, is imprescriptible and not barred under the doctrine of laches. There is no absolute rule as to what constitutes laches or staleness of demand; each case is to be determined according to its particular circumstances. The question of laches is addressed to the sound discretion of the court and since laches is an equitable doctrine, its application is controlled by equitable considerations. It cannot be worked to defeat justice or to perpetrate fraud and injustice. It would be rank injustice and patently inequitous to deprive the lawful heirs of their rightful inheritance.

[MELECIA AS ILLEGITIMATE CHILD] ● From the start the respondent court erred in not declaring that Melecia Jimenez Cayabyab also known as Melecia Jimenez, is not the daughter of Carlos Jimenez and therefore, had no right over the property in question. Nonetheless, assuming for the sake of argument that Melecia Cayabyab was the illegitimate daughter of Carlos Jimenez there can be no question that Melecia Cayabyab had no right to succeed to the estate of Carlos Jimenez and could not have validly acquired, nor legally transferred to Edilberto Cagampan that portion of the property subject of this petition. ● To be an heir under the rules of Civil Code of 1889 (which was the law in force when Carlos Jimenez died

●

and which should be the governing law in so far as the right to inherit from his estate was concerned), a child must be either a child legitimate, legitimated, or adopted, or else an acknowledged natural child — for illegitimate not natural are disqualified to inherit. Even assuming that Melecia Cayabyab was born out of the common-law-relationship between her mother (Maria Cayabyab) and Carlos Jimenez, she could not even be considered an acknowledged natural child because Carlos Jimenez was then legally married to Susana Abalos and therefore not qualified to marry Maria Cayabyab and consequently Melecia Cayabyab was an illegitimate spurious child and not entitled to any successional rights in so far as the estate of Carlos Jimenez was concerned.

● Sotto vs. Teves, 86 SCRA 154 (1978) Author: Mark (Please try to see the original. Ang labo ng case. Baka mas maintindihan niyo sa original. Sana. Ewan. Basta, ang labo.) Facts: (This suit involves the heirs of Concepcion Rallos and the estate of Atty. Filemon Sotto.) ● This involves 5 parcels of land in Cebu City. ● It originally belonged to the conjugal partnership of Florentino and Maria Rallos ● They had 2 children, Carmen and Concepcion ● When Florentino died, his properties were bequeathed to Maria, Carmen and Concepcion ● Maria, Carmen and Concepcion entrusted the settlement of the estate to Atty. Sotto. ● The probate proceedings closed in 1913. ● It was agreed that the property would be preserved for the family, through a co-ownership ● Afterward, Atty. Sotto married Carmen ● Maria then passed away ● Carmen died in 1945 without having any children ● However, Atty. Sotto has children out of wedlock. ● Concepcion died, leaving behind many children. ● When Atty. Sotto was already old and under guardianship, the heirs of Concepcion found out that the 5 parcels in Cebu were in the name of Carmen only, then passed to Atty. Sotto ● All along, Concepcion’s heirs believed that the properties would be passed to them.

Since the properties were now in the name of Atty. Sotto, it was in danger of being passed to his illegitimate children.

CFI ●

Hence, Concepcion’s heirs went to the CFI, suing Marcelo Sotto (administrator of Atty. Sotto’s estate) for recovery of possession and ownership of the 5 parcels in Cebu. ● Concepcion’s heirs claim that there was a trust relationship between Atty. Sotto and Maria, Carmen and Concepcion ● Thus, Atty. Sotto violated the trust by placing the properties solely in his wife’s Carmen’s name, and ultimately, to him. ● Concepcion’s heirs say that the decree is null and void because it should have been issued not just in Carmen’s name, but also in Maria and Concepcion’s names as well. ● Marcelo says that the decree adjudicating the lots in the name of Carmen was pursuant to an express agreement between Carmen and the other heirs that such parcel be given to her ● CFI dismissed the complaint of Concepcion’s heirs. ● No trust was established over the lots ● The transfer of the lots was done through actual and legitimate partition, wherein Carmen got the 5 lots. ● Thus, Carmen was entitled to register them in her name. th CA 8 Division ● Concepcion’s heirs appeal to the CA ● CA 8th Division affirms the CFI Decision ● Concepcion’s heirs file a MR CA Special Division

● ●

● ●

● ●

CA Special Division reverses the CA 8th Division CA Special Division held that Atty. Sotto’s special relations with the family made him a constructive trustee of his wife Carmen and Maria and Concepcion. Hence, as a trustee, he should not have put his interests above those of the family. Also, Carmen did not acquire the lots, but was rather entitled only to the usufruct thereof, as administratrix of the trust between her, Maria and Concepcion. Thus, Carmen could not have passed the property to her husband Atty. Sotto. CA Special Division thus declares Concepcion’s heirs as the rightful owners of the properties.

Issue: Can a trustee who registered the property in her/his name rely on the registration as against the beneficiaries? Held: No. The SC affirms the decision of the CA Special Division. Ratio: ● Marcelo Sotto claims that Carmen already had the property registered in her name, so she was well within her right to transfer it to Atty. Sotto. ● However, the SC says that Carmen could not have done that because she held the property in trust for Maria and Concepcion, and as such she could not dispose of the property to the prejudice of the others. ● The trust over the properties was present since 1913 ● It is true that Torrens titles were issued in the name of Carmen Rallos, but the principle holds that a trustee who takes a Torrens title in his name cannot repudiate

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●

the trust by relying on the registration, which is one of the well-known limitations upon the finality of a decree of title. Because of the very nature of a trust relation which existed between Carmen Rallos and her co-owners, she cannot obtain and secure a torrens title to the properties in her name much less dispose of them by testament to her husband, a constructive trustee, to the prejudice and deprivation of the rights and interests of said co-heirs. A fiduciary relationship may exist even if the title to the property subject to the trust appears in the name of the trustee alone, because in cases of trusteeship, the legal title usually appears in the name of the trustee, while the equitable title remains with the cestui que trust.

Toyota Motor Philippines Corp. vs. CA, G.R. No. 102881, Dec. 7, 1992 Author: Delgado Facts: i. This case is a boundary dispute between Toyota Motor Phil. Corporation and Sun Valley Manufacturing and Development Corporation. Both are the registered owners of two adjoining parcels of land situated in La Huerta, Parañaque, Metro Manila which they purchased from the Asset Privatization Trust (APT). ii. The properties in question formerly belonged to Delta Motors Corporation (DMC). They were foreclosed by the Philippine National Bank (PNB) and later transferred to the national government through the APT for disposition. iii. APT then proceeded to classify the DMC properties according to the existing improvements, i.e., buildings, driveways, parking areas, perimeter fence, walls and gates and the land on which the improvements stood. The entire DMC property is called GC III-Delta Motors Corporation, divided into Delta I, Delta II, and Delta III. Further subdivisions for the separate catalogues were made for each division e.g. Delta I into Lots 1, 2 and 3. After this classification, APT parcelled out and catalogued the properties for bidding and sale. iv. Part of the duly parcelled Delta I property (Lot 2) was sold to Toyota through public bidding on May 12, 1988 for the amount of P95,385,000.00. After its purchase, Toyota constructed a concrete hollow block (CHB) perimeter fence around its alleged property. v. On October 5, 1990, another part of the parcelled Delta I (Lot 1) covering an area of 55,236 square meters was

purchased by Sun Valley from APT for the bid price of P124,349,767.00. Relying upon the title description of its property and the surveys it had commissioned, Sun Valley claimed that Toyota's perimeter fence overlaps Sun Valley's property along corners 11 to 15 by 322 square meters and corners 19 to 1 by 401 square meters for a total of 723 square meters. vi. Negotiations between the corporations for a possible settlement of the dispute bogged down. Court battles ensued, grounded on purely procedural issues. In pursuing the resolution of the dispute, both Toyota and Sun Valley opted to file separate actions. Much of the complications that arose and are now before us can be traced to the two separate cases pursued by both parties. vii. Toyota Case: Toyota filed an action for reformation before Judge Tensuan on September 11, 1991, before Judge Tensuan alleging that the true intentions of the parties were not expressed in the instrument (Art. 1359 Civil Code). The instrument sought to be reformed is the deed of sale executed by APT in favor of Toyota. Toyota alleges that there was a mistake in the designation of the real properties subject matter of the contract. Sun Valley was impleaded in order to obtain complete relief since it was the owner of the adjacent lot. viii. Sun Valley Case: Sun Valley filed an action for recovery of possession before Judge Gorospe of the disputed 723 square meters boundary with the Regional Trial Court (RTC) Makati. On the same day, Judge Gorospe issued a TRO enjoining Toyota from committing further acts of dispossession against Sun Valley. It argues that Toyota’s complaint for reformation states no cause of action against it since an action for reformation is basically one strictly between the parties to the contract itself. Third persons who are not parties to the

contract cannot and should not be involved. Thus, Sun Valley contends that it should not have been impleaded as a defendant. Issue: i. Who as between Judge Tensuan or Judge Gorospe has jurisdiction of the case. ii. Who as between the parties has the rightful possession of the land. Held: i. Sun Valley's action for recovery of possession filed before Judge Gorospe now stands to be the proper forum where the following dispute may be tried or heard. ii. Sun Valley has a better right. Ratio: i. General rule: All persons to be affected by the proposed reformation must be made parties. However, these principles are not applicable under the particular circumstances of this case. Under the facts of the present case, Toyota's action for reformation is dismissible as against Sun Valley. ii. The contention that the arbitration clause has become disfunctional because of the presence of third parties is untenable. The contract of sale executed between APT and Toyota provides an arbitration clause which states that: In case of disagreement or conflict arising out of this Contract, the parties hereby undertake to submit the matter for determination by a committee of experts, acting as arbitrators, the composition of which shall be as follows: a) One member to be appointed by the VENDOR; b) One member to be appointed by the VENDEE;

c) One member, who shall be a lawyer, to be appointed by both of the aforesaid parties; The members of the Arbitration Committee shall be appointed not later than three (3) working days from receipt of a written notice from either or both parties. The Arbitration Committee shall convene not later than three (3) weeks after all its members have been appointed and proceed with the arbitration of the dispute within three (3) calendar months counted therefrom. By written mutual agreement by the parties hereto, such time limit for the arbitration may be extended for another calendar month. The decision of the Arbitration Committee by majority vote of at least two (2) members shall be final and binding upon both the VENDOR and the VENDEE.

iii. Contracts are respected as the law between the contracting parties. As such, the parties are thereby expected to abide with good faith in their contractual commitments. Toyota is therefore bound to respect the provisions of the contract it entered into with APT. iv. The arbitration committee is therefore the proper and convenient forum to settle the matter as clearly provided in the deed of sale. Having been apprised of the presence of the arbitration clause in the motion to dismiss filed by APT, Judge Tensuan should have at least suspended the proceedings and directed the parties to settle their dispute by arbitration. Judge Tensuan should have not taken cognizance of the case. v. The more apparent reason which warrants the dismissal of the action as against Sun Valley is the fact that the complaint for reformation amounts to a collateral attack on Sun Valley's title, contrary to the finding of the Court of Appeals' 11th Division. Sun Valley has a Torrens title registered in its name by virtue of its purchase of the land from APT. Wellsettled is the rule that a certificate of title can not be altered, modified, or cancelled except in a direct proceeding in accordance with law, thus an action for

reformation is improper. Reformation may often be had to correct mistakes in defining the boundary of lands conveyed so as to identify the lands, it may not be used to pass other lands from those intended to be bought and sold, notwithstanding a mistake in pointing out the lines, since reformation under these circumstances would be inequitable and unjust. vi. Existence of a "clear positive right" especially calling for judicial protection has been shown by Sun Valley. Sun Valley has TCT No. 49019 of the Registry of Deeds of Parañaque embracing the aforesaid property in its name, having been validly acquired also from APT by virtue of a Deed of Sale executed in its favor on December 5, 1990. There is therefore sufficient and convincing proof that Sun Valley has a clear legal right to possession in its favor to warrant the issuance of a writ of preliminary/mandatory injunction. Sun Valley's TCT gives it that right to possession. On the other hand, Toyota has not established its right over the said property except for the assertion that there was a mistake in an instrument which purportedly should have included the questioned strip of land. Realty Sales Enterprises, Inc. vs. IAC, 154 SCRA 328 (1987) Author: Monzon Facts: Two adjacent parcels of land located in Almanza, Las Piñas, Metro Manila situated in the vicinity of the Ayala Alabang Project and BF Homes Parañaque are covered by three distinct sets of Torrens titles

Morris Carpo filed a complaint with the CFI of Rizal referred to as Vera Court for "declaration of nullity of Decree No. N-63394 and TCT No. 20408." Named defendants were Realty Sales Enterprise, Inc., Macondray Farms, Inc. and the Commissioner of Land Registration. The complaint alleged is a nullity as the CFI of Rizal referred to as the Reyes Court which issued the order directing the issuance of a decree of registration, was not sitting as a land registration court, but as a court of ordinary jurisdiction. It was further alleged that the original records the basis for the issuance of said order of were lost and/or destroyed during World War II and were still pending reconstitution; hence, the Reyes Court had no authority to order the issuance of a certificate of title. Realty and Macondray alleged in their answer that the Reyes Court was acting as a court of land registration and in issuing the order, was actually performing a purely ministerial duty for the registration court which had rendered a decision adjudicating the two (2) lots in question to Estanislao Mayuga. It was alleged that it is the title of Carpo which is null and void, having been issued over a parcel of land previously registered under the Torrens System in favor of another. With leave of court, Realty and Macondray filed a third-party complaint against the Quezon City Development and Financing Corporation. QCDFC asserted the validity of its own title alleging that it is the title in the name of Realty which is null and void. QCDFC also filed a fourth-party complaint alleging that it bought said parcels of land from them. Fourth-party complaint was dismissed for lack of interest.

Vera Court rendered judgment sustaining the title of Morris G. Carpo to the two (2) lots in question and declaring the titles of Realty Sales Enterprise, Inc. and QCDFC null and void. Carpo filed a motion for reconsideration with the appellate court. In the meantime, the Court of Appeals was reorganized into the Intermediate Appellate Court (IAC). As a consequence, there was a re-raffling of cases and the case was assigned to the Second Special Cases Division which returned the records of the case for another re-raffling to the Civil Cases Divisions as it deemed itself without authority to act on a civil case in view of the allocation of cases to the different divisions of the IAC under Section 8 of BP 129. The case was then assigned to the Third Civil Cases Division. On, December 29, 1982, the Court of Appeals set aside the decision of the trial court and rendered a new one upholding the validity of the title in the name of Realty Sales Enterprise, Inc. and declaring null and void the titles in the name of Carpo and QCDFC. The IAC, through its Special Third Civil Cases Division granted Carpo's motion for reconsideration, reversing and setting aside the decision of December 29, 1982, and affirming the decision of the trial court.

Issue: W/N declaring the title in the name of Carpo was valid - No Ruling: The Dec 29, 1982 decision of CA was affirmed.

Re issue of jurisdiction: Under Act No. 496, Land Registration Act, (1902) as amended by Act No. 2347 (1914), jurisdiction over all applications for registration of title to and was conferred upon the Courts of First Instance of the respective provinces in which the land sought to be registered is situated. Jurisdiction over land registration cases, as in ordinary actions, is acquired upon the filing in court of the application for registration, and is retained up to the end of the litigation. The issuance of a decree of registration is but a step in the entire land registration process; and as such, does not constitute a separate proceeding. In the case at bar, it appears that it was Estanislao Mayuga, father of Dominador Mayuga, predecessor-in-interest of Realty, who originally filed in the CFI of Rizal to confirm his title over parcels of land described (Lots 2 and 3 the subject of the instant litigation among Carpo, RRealty and QCDFC.) On May 13, 1958 Dominador Mayuga, son of Estanislao, filed a petition with the Reyes Court alleging that he was the only heir of the deceased Mayuga and praying for the issuance of a decree of registration over the property adjudicated in favor of Estanislao. It cannot be overemphasized that the petition filed by Dominador is NOT a distinct and separate proceeding from, but a continuation of, the original land registration proceedings initiated by Estanislao Mayuga, Florentino Baltazar and Eduardo Guico. In the same vein, the Reyes Court, as Branch VI of the Court of First Instance of Rizal, was continuing in the exercise of jurisdiction over the case, which jurisdiction was vested in the CFI-Rizal upon filing of the original applications.

Re records destroyed by fire/calamities: Section 29 of Act No. 3110 should be applied only where the records in the CFI as well as in the appellate court were destroyed or lost and were not reconstituted, but not where the records of the Court of First Instance are intact and complete, and only the records in the appellate court were lost or destroyed, and were not reconstituted. The whole theory of reconstitution is to reproduce or replace records lost or destroyed so that said records may be complete and court proceedings may continue from the point or stage where said proceedings stopped due to the loss of the records. If the records up to a certain point or stage are lost and they are not reconstituted, the parties and the court should go back to the next preceding age where records are available, but not beyond that; otherwise to ignore and go beyond the stage next preceding would be voiding and unnecessarily ignoring proceedings which are duly recorded and documented, to the great prejudice not only of the parties and their witnesses, but also of the court which must again perforce admit pleadings, rule upon them and then try the case and decide it anew,-all of these, when the records up to said point or stage are intact and complete, and uncontroverted. The parties thereto did not have to commence a new action but only had to go back to the preceding stage where records are available. The land registration case itself re. mained pending and the Court of First Instance of Rizal continued to have jurisdiction over it. Re innocent purchaser: Whether or not Carpo is an innocent purchaser for value was never raised as an issue in the trial court. A perusal of the records of the case reveals that no factual basis exists to support such a conclusion. Even Carpo himself cites no

factual proof of his being an innocent purchaser for value. He merely relies on the presumption of good faith under Article 527 of the Civil Code. It is settled that one is considered an innocent purchaser for value only if, relying on the certificate of title, he bought the property from the registered owner, "without notice that some other person has a right to, or interest in, such property and pays a full and fair price for the same, at the time of such purchase, or before he has notice of the claim or interest of some other persons in the property." Also, Since Realty is claiming under TCT No. 1609 which was issued earlier than OCT No. 8931 from which QCDFC's title was derived, Realty's title must prevail over that of QCDFC. It must be emphasized that the action filed by Carpo against Realty is in the nature of an action to remove clouds from title to real property. By asserting its own title to the property in question and asking that Carpo's title be declared null and void instead, and by filing the third-party complaint against QCDFC, Realty was similarly asking the court to remove clouds from its own title. Actions of such nature are governed by Articles 476 to 481. Suits to quiet title are not technically suits in rem, nor are they, strictly speaking, in personam, but being against the person in respect of the res, these proceedings are characterized as quasi in rem.The judgment in such proceedings is conclusive only between the parties.

Albienda vs. CA, 135 SCRA 402 (1985) Author: GOJAR

Private respondents Supposes Sumampao were applicants for a free patent over a land known as lot 1548 situated in San Francisco Agusan del Sur. ● They claimed that an 8-hectare portion was erroneously included in the technical description of the certificate of title covering Lot 1550 which is the adjoing lot belonging to petitioner Felda Albienda. They based such claim from the technical description in the survey return by the Bureau of Lands surveyors. Hence, the respondents instituted an action against petitioner Albienda for correction of the latter’s certificate of title and recovery of possession/reconveyance of said portion of the land, with damages. Petitioner averred that Lot 1550 with an area of 196,848 sq.m originally belonged to Enesaria Goma in whose name the same was registered under the Torrens System on July 23. 1958 then Goma sold it to Senerpida who possessed it continuously & peacefully until Nov 21, 1972 when petitioner Albienda acquired the lot for value in good faith and when the deed of sale in favour of Albienda was registered, she was issued a TCT covering Lot 1550 with an area of 196, 848 sq.m. which is the same area stated in the certificates of title of petitioner’s predecessors-in-interest ●

ALSO, petitioner alleged that assuming the technical description was wrong, the action for correction and reconveyance is unavailable because more than 1 year had elapsed since the issuance of the original certificate of title in 1958 to petitioner’s predecessor-ininterest, Enesaria Goma.

Issue having been joined, respondents filed a motion for summary judgment and the documents and affidavits attached disclosed that: On August 22, 1958 - Loida Beterbonia, respondent’s predecessor in-interest, wrote the Director of Lands requesting for a recomputation of the respective areas of the adjoining properties (Lot 1548 and Lot 1550), Dec 2, 1958 - the chief of survey party stationed in San Francisco Agusan, to whom the letter was referred, issued an indorsement stating that ““it is believed that there has been a mistake in the computation of the technical description of Lot 1550 because when the computation was done in Manila, the plan was not yet available as it was still in Agusan office” BUT no further action was taken from that letter Trial court: granted the summary judgment and ordered the gov. officials to make necessary corrections and conform to the survey by Bureau of Lands Cagayan and ordered Albiendo to vacate the overlapped area and turn over to spouses Sumamapo CA: affirmed trial court decision ISSUE: Whether or not the description of a parcel of land in the petitioner’s certificate of title may be corrected to conform with the technical description appearing in the “survey return” on file in the Bureau of Lands, notwithstanding the lapse of more than one (1) year since the issuance of said certificate of title? NO.

HELD: Section 38 of the Land Registration Act: “Every decree of registration shall bind the land, and quiet title thereto x x x it shall be conclusive upon and against all persons x x x x whether mentioned by name in the application, notice, or citations, or included in the general description ‘To All Whom It May Concern/ “It is a settled doctrine that even when the decree of registration has been obtained by fraud, the party defrauded has only one year from entry of the decree to file a petition for review before a competent court, and such petition can prosper only if no innocent purchaser for value has acquired an interest in the land.” Said Section 38 categorically declares that “upon the expiration of the said term of one [1] year every decree or certificate of title issued in accordance with this section shall be incontrovertible. Hence, A Torrens Title can no longer be corrected as to area description after the lapse of one year from issuance of decree of registration and the land has already been sold to a purchaser in good faith even if area in the title does not correspond to survey return or file with the Bureau of Lands. In this case, the original certificate of title covering Lot 1550 was issued on July 23, 1958 in favor of Enesaria Goma, the petitioner’s predecessor-ininterest. The fact that sometime in October 1958 Loida Baterbonia had written the Director of Lands for a recomputation of the area set forth in the certificate of the said land is of no moment, for up until the sale of Lot 1550 to petitioner in 1972, no action had been brought before a court of competent jurisdiction to correct the error, if indeed there was such error.

The instant action to correct the certificate of title in question was filed on July 13, 1977 or about 19 years after the issuance of said certificate of title. Since the period allowed by law for setting aside the decree of registration of a certificate of title had long elapsed, the original certificate of title issued in the name of petitioner’s predecessor-in-interest had become indefeasible. The Transfer Certificate of Title derived therefrom is likewise unassailable, for under Section 39 of Act 496, “every person receiving a certificate of title in pursuance of a decree of registration, and every subsequent purchaser of registered land who takes a certificate of title for value in good faith shall hold the same be free of all encumbrance except those noted on said certificate.” Hence, every person dealing with registered land may rely on the correctness of the certificate of title issued therefor and the law will in no way oblige them to go behind the certificate to determine the condition of the property.

Republic vs. CA, G.R. No. 84966, Nov. 21, 1991 Author: Kat Facts: 1. The Republic of the Philippines, represented by the Solicitor General, filed on August 22, 1979, a complaint for declaration of nullity of Decreto No. 6146, the owner's duplicate copy of TCT No. 2337 and all titles derived from said decree; and the declaration of the parcel of land

covered by the decree as belonging to the state, except so much thereof as had been validly disposed of to third persons. 2. The complaint was amended on October 12, 1979. The complaint alleged that: " The alleged Decree No. 6146 issued on September 10, 1911 and the alleged owner's copy of Transfer Certificate of Title No. 23377 issued on May 12, 1933, both in the name of Francisco and Hermogenes Guido, and which supposed owner's duplicate was made the basis of the administrative reconstitution of Transfer Certificate of Title No. (23377) on March 29, 1976, or about 43 years later, are false, spurious and fabricated and were never issued by virtue of judicial proceedings for registration of land, either under Act No. 496, as amended, otherwise known as the Land Registration Act

3. Named defendants were: 1) Antonina, Margarita, Feliza, Crisanta and Candida, nee Guido, who claim to be the heirs of Francisco Guido and whose spouses were joined as defendants; 2) Esperanza, Alfredo (who died during the pendency of this case and who was substituted by his heirs), Eufronia, Gliceria, Priscilla, Profetiza, Buenaventura, Buensuceso and Carlos, all surnamed Guido, who claimed to be the heirs of Hermogenes Guido and whose respective spouses were joined as defendants; 3) Spouses Jose and Emiliana Rojas; 4) Pacil Development Corporation; and 5) Interport Resources Corporation. 4. The defendants, herein private respondents, denied that Decreto No. 6145 and TCT No. 23377 were false and spurious. They consistently claimed (from the trial court up to this Court) that the parcel of land covered by the questioned document is a portion of the vast Hacienda de Angono owned by their predecessor-in-interest, Don Buenaventura Guido y Sta. Ana; that Don Buenaventura Guido left a portion of the hacienda to his heirs, Francisco and Hermogenes Guido; that the subject matter of the petition is only a portion of plano 11-827, consisting of an area of

3,181.74 hectares and covered by Decreto No. 6145, issued on September 1, 1911 in the name of the heirs of Buenaventura Guido y Sta. Ana (Francisco and Hermogenes Guido); that on June 12, 1912, an Original Certificate of Title (OCT No. 633) was issued on the basis of Decreto No. 6145; that the original title was subsequently cancelled and in lieu thereof, Transfer Certificate of Title No. 23377 was issued on May 12, 1933; that the heirs of Francisco and Hermogenes Guido adjudicated among themselves the estate left by their predecessors and transferred one-half portion thereof to Jose Rojas sometime in 1942, as contained in an Extrajudicial Settlement of Estate with Quitclaim dated December 17, 1973. 5. The parties admit that on August 20, 1974, the heirs of Buenaventura Guido, represented by their lawyer, requested LRA to issue the corresponding original certificate of title based on Decreto 6145. The request was denied on January 8, 1976. 6. On March 29, 1976, Alfredo Guido, representing the other heirs, filed a petition for reconstitution of TCT No. 23377 with the Registry of Deeds of Morong. The petition alleged that the original of Transfer Certificate of Title No. 23377 could not be located in the files of the Registry of Deeds of Rizal after he and his co-heirs sought the registration of their Extra- judicial Settlement with Quitclaim dated December 17, 1973. The petition was supported by the owner's duplicate copy of the title. The petition for administrative reconstitution of TCT No. 23377 was granted and a reconstituted certificate of title was issued dated March 29, 1976. 7. After the reconstitution, the heirs presented before the Registry of Deeds of Morong the Extra-judicial Settlement of Estate with Quitclaim which they executed on December 17, 1973 in favor of Jose Rojas and which they had earlier presented for registration. 21 lots subdivided into 21 separate titles

8. The named heirs and now spouses Jose and Emilia Rojas sold the property to Pacil Management Corporation and new titles were issued in favor of the buyer on June 25, 1976. However, on August 26, 1976, Pacil Management Corporation reconveyed all the twenty one lots to the former owners. 9. On August 25, 1978, fourteen (14) of these twenty-one (21) lots were exchanged with shares of stocks of Interport Resources Corporation. On April 21, 1980, all the named heirs renounced their rights over the property in favor of their co-heir Alfredo Guido, Sr. in exchange for monetary considerations. It appears that the only parties with existing interests in the property subject of this case are Interport Resources Corporation, the Heirs of Alfredo Guido, Sr. and spouses Jose Rojas and Emilia Rojas. 10. After trial, the court a quo rendered judgment dismissing the complaint and declaring Decree No. 6145 and TCT No. 23377, genuine and authentic. 11. The decision of the trial court was appealed by the Solicitor General to the Court of Appeals which affirmed said decision on July 12, 1988. On July 16, 1988, the Solicitor General filed a MR of the decision of the CA. In the same motion, he prayed for an alternative judgment declaring the decree and its derivative titles authentic except with respect to such portions of the property which were either: 1) possessed and owned by bona fide occupants who had already acquired indefeasible titles thereto; or 2) possessed and owned by bona fide occupants and their families with lengths of possession which amounted to ownership. MR denied Issue: w/n it possessed all the attributes of a decree of registration Held/Ratio: YES. IT POSSESSED ALL THE ATTRIBUTES OF DECREE OF REGISTRATION. No legal basis for the declaration of the questioned documents as valid only with respect to such portions of the property not possessed and owned by bonafide occupants with indefeasible registered titles

of ownership or with lengths of possession which had ripened to ownership. Having been found valid and genuine, Decreto No. 6145 therefore, possessed all the attributes of a decree of registration. having been found true and authentic also possessed all the attributes of a torrens certificate of title. By express provision of Section 47 of P.D. 1529, no title to registered land in derogation to that of the registered owner shall be acquired by prescription or adverse possession. To declare that the decree and its derivative titles is valid but only with respect to the extent of the area described in the decree not possessed by occupants with indefeasible registered titles or to possessors with such lengths of possession which had ripened to ownership is to undermine the people's faith in the torrens title being conclusive as to all matters contained therein. The certificate serves as evidence of an indefeasible title to the property in favor of the person whose names appear therein. After the expiration of the one year period from the issuance of the decree of registration upon which it is based, it becomes incontrovertible