2013 CASES

ALBANO, FRANKARGOSINO, JULIENNECHAVEZ, MARIGALAMGAM, JOHN CARLOSITOM, BLISSY NATALIELOPEZ, RYAN ANGELO

ITOM, BLISSY NATALIE S.

REPUBLIC OF THE PHILIPPINES VS AFP RETIREMENT (G.R. NO. 180463) JANUARY 16, 2013

The processes of the State should not be trifled with. The failure of a party to avail of the proper remedy to acquire or perfect one’s title to land cannot

justify a resort to other remedies which are otherwise improper and do not provide for the full opportunity to prove his title, but instead require him to

concede before availment.

FACTS:

Lots X, Y-1 and Y-2 lands of the public domain consisting of 52,678 square meters located in Bario Dadiangas, General Santos City were reserved for recreation and health purposes by virtue of Proclamation No. 168 which was issued in 1963. Moreover, Proclamation 2273 was enacted which re-classified and returned lots Y-1 and Y-2 to their original alienable and disposable state which the respondents-interveners waged in a campaign through petitions and pleas made to the President assailing that through their predecessor Cabalo Kusop they have acquired vested private rights over these lots.

Respondents-interveners filed application for issuance of individual miscellaneous sales patents over the whole of Lot X with the DENR Regional Office thus later on 16 original certificates of title (OCT’s) covering Lot X were issued in the names of respondents-interveners and several others. The aforementioned 16 titles were simultaneously conveyed to AFP Retirement and Separation Benefits System (AFP-RSBS) resulting in the issuance of 16 new titles (AFP-RSBS titles). The Republic of the Philippines constituted a complaint for reversion, cancellation and annulment of the AFP-RSBS titles on the theory that they were issued over a public park which is classified as inalienable and non-disposable public land.

The Regional Trial Court ruled in nullifying the AFP-RSBS titles and ordering the return of Lot X to the Republic, with the corresponding issuance of new titles in its name. It futhermore ruled that respondents-interveners can no longer claim Lot X which has been specifically declared as park reservation under Proc. 168. The private rights which were guaranteed under Proc. 168, have already been subsequently issued Proc. 2273 as a consequence the succeeding sale patents should be declared null and void not only in violation of law but also respondent-interveners did not deserve to acquire more land.

The Court of Appeals ruled that respondents-interveners predecessor-in-interest acquired title by prescription and as a consequence of their predecessor’s possession of Lot X since time immemorial, and the former

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have acquired title without need of judicial or other action, and the property ceased to be public land and thus became a private property. Miscellaneous sales patents issued affirm their claim of ownership while the OCT’s subsequently issued in their names rendered their claim indefeasible. The sale transfer thereof should be accorded the same treatment as a sale transfer made to purchaser in good faith.

ISSUE:

1. WON by applying for miscellaneous sales patent, the heirs have admitted that Lot X is public land.

2. WON the alleged “vested rights” of the heirs over lot X cannot prevail against government ownership of public land under the Regalian doctrine

3. WON there is no basis to conclude that Proc. 2273 recognized the ownership of Lot X by the heirs and thus neither there is basis to claim that the heirs retained ownership of Lot X due to failure of the City General Santos to accept donation of Lot X.

RULING:

The Court grants the petition.

From the wording of Proc. 168, the land it comprises is subject to sale of settlement, and thus alienable and disposable. However, alienable and disposable character of the land covered by the proclamation was subsequently withdrawn, and the land was re-classified to pave way for the establishment of a reservation subject to previously acquired private rights. Respondents-interveners did not question Proc. 2273, precisely because they were the beneficiaries thereof instead in 1997 they applied for and were granted sales patents over Lot X.

Evidently, the sales patents over Lot X are null and void, for at the time the sales patents were applied for and granted, the land had lost its alienable and disposable character. It was set aside and was being utilized for a public purpose that is recreational park. Respondent-interveners no longer had any right to Lot X – not by acquisitive prescription, and certainly not by sales patent. In fact, their act of applying for the issuance of miscellaneous sales patents operates as an express acknowledgement that the state is the owner of Lot X. It is erroneous to suppose that respondents-interveners possessed title to Lot X when they applied for miscellaneous sales patents, for the premise of such grant or privilege is precisely that the

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State is the owner of the land and that the applicant acknowledges this and surrenders to State ownership.

The government, as the agent of the State, is possessed of the plenary power as the persona in law to determine who shall be the favoured recipients of public lands as well as what terms they may be granted such privilege not excluding the placing of obstacles in the way of their exercise of what otherwise would ordinary acts of ownership.

Proof or evidence of possession from time immemorial becomes irrelevant and cannot support a claim of ownership or application of patent, not only because respondent’s-interveners have conceded ownership to the State, but also on account of the fact that Lot X has been withdrawn from being alienable and disposable public land, and is now classified and being used by the national park. It had ceased to be alienable, and no proof by the respondents-interveners will operate to bolster their claim. Lot X will never be awarded to them or anybody so long as it is being used as public park or reserve.

The Court sustains the petitioner’s view that “any title issued covering non-disposable lots even in the hands of alleged innocent purchaser for value shall be cancelled”. It is deemed that this case is worthy of this principle. Besides it cannot ignore the basic principle that a spring cannot rise higher than its source; as successors in interest AFP-RSBS cannot acquire a better title than its predecessor, the herein respondents-interveners. Having acquired no title to the property in question, there is no other recourse but for AFP-RSBS to surrender to the rightful ownership of the State.

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ARGOSINO, JULIENNE

CAROLINA VDA. DE FIGURACION V. EMILIA FIGURACION(GR NO. 151334) FEBRUARY 13, 2013

Mere issuance of a certificate of title in the name of any person does not foreclose the possibility that the real property may be under co-ownership

with persons not named in the certificate, or that the registrant may only be a trustee, or that other parties may have acquired interest over the property

subsequent to the issuance of the certificate of title.

FACTS:

The parties are the heirs of Leandro Figuracion who died intestate in May 1958. Petitioner Carolina is the surviving spouse.

At the center of the controversy is Lot No. 707 of the Cadastral Survey of Urdaneta, Pangasinan, with an area of 3,164 square meters originally owned by Eulalio Adviento, covered by Original Certificate of Title (OCT) No. 15867 issued in his name on August 21, 1917. Eulalio begot Agripina Adviento with his first wife Marcela Estioko. Estioko died and later on, Eulalio got remarried to Faustina Escabesa and had a daughter, the herein petitioner Carolina.

On November 28, 1961, Agripina executed a Deed of Quiclaim over the eastern half of Lot No. 707 in favor of her niece, daughter of Carolina and Leandro, respondent, Emilia.

On December 11, 1962, petitioner Carolina executed an Affidavit of Self-Adjudication, adjudicating unto herself the entire Lot No. 707 as the sole and exclusive heir of her deceased parents Eulalio and Faustina. She then executed a Deed of Absolute Sale over said lot in favor of petitioners Hilaria and Felipa, who in turn immediately caused the cancellation of OCT No. 15867 and the issuance of TCT No. 42244 in their names.

In 1971, Emilia and her family went to the states and returned in the Philippines in 1981. She then built a house in the eastern half of Lot No. 707.

In 1994, Hilaria and her agents threatened to demolish the said house claiming that TCT No. 42244 in the name of Felipa and Hilaria have already attained indefeasibilty and conclusiveness as to the true owners of Lot No. 707

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ISSUE:

Whether or not Felipa and Hilaria are the rightful owners of Lot No. 707 taking into consideration that they have TCT No. 42244 under their name

HELD:

No.

Mere issuance of a certificate of title in the name of any person does not foreclose the possibility that the real property may be under co-ownership with persons not named in the certificate, or that the registrant may only be a trustee, or that other parties may have acquired interest over the property subsequent to the issuance of the certificate of title.

The status of Agripina and Carolina as the legitimate heirs of Eulalio is an undisputed fact. As such heirs, they became co-owners of Lot No. 707 upon the death of Eulalio on July 30, 1930. Since Faustina was predeceased by Eulalio, she likewise became a co-owner of the lot upon Eulalio’s death. Faustina’s share, however, passed on to her daughter Carolina when the former died. The Affidavit of Self-Adjudication executed by Carolina did not prejudice the share of Agripina because it is not legally possible for one to adjudicate unto him an entire property he was not the sole owner of. A co-owner cannot alienate the shares of her other co-owners – nemo dat qui non habet.

Under the Old Civil Code which was then in force at the time of Eulalio and Marcela’s marriage, Lot No. 707 was their conjugal property. When Marcela died, one-half of the lot was automatically reserved to Eulalio, the surviving spouse, as his share in the conjugal partnership. Marcela’s rights to the other half, In turn, were transmitted to her legitimate child, Agripina and Surviving spouse Eulalio.

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ALBANO, FRANK

PADILLA MERCADO, ET AL. VS. SPOUSES AGUEDO AND LOURDES ESPINA

(G.R. NO. 173987) FEBRUARY 25, 2012

Where the complaint for recovery of ownership and possession of a parcel of land, alleges that some of the defendants bought said land from their co-

defendants who had a defective title thereto – but does not allege that the purchasers were purchasers in bad faith or with notice of the defect in the title of their vendors, it is held that the lower court correctly dismissed the

complaint against the purchasers for failure to state a cause of action against them.

FACTS:

On May 8, 2000, herein petitioners filed with the RTC of Maasin, Southern Leyte, and a Complaint for Recovery of Property and Declaration of Nullity of Deed of Sale, Certificate of Title and Damages, covering 338 square meter parcel of land located on the same locality. Mercado et al. alleged in their Complaint that they are the heirs of the late spouses Santiago and Sofronia Mercado, who were the owners of the subject parcel of land; after the death, petitioners inherited the disputed lot, possessing the same as owner. Sometime in 1996, herein respondents claimed ownership over the subject parcel of land, alleging that they bought the same from one Josefa Mercado Espina which by trace originated from one Escolastico Mercado in 1937 who, in turn, allegedly bought it from Santiago Mercado. Petitioners further alleged that in 1962, Josefa, through fraudulent machinations, was able to obtain a title over the property. Asserting that the above-mentioned contracts of sale never happened, petitioners prayed for the declaration of nullity of the deeds of sale between Santiago and Escolastico, and all subsequent sale up to Josefa. They prayed that the TCT in the name of herein respondents be nullified and that petitioners be declared as the owners of the disputed lot. Moreover, asked that the court award them actual, moral and exemplary damages, and attorney's fees.

On the year 2000, respondents filed a Motion to Dismiss on grounds that the RTC has no jurisdiction over the case due to the failure of the complainant to state the assessed value of the property, that petitioners'

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cause of action is barred by prescription, laches and indefeasibility of title, and that the complaint does not state sufficient cause of action against respondents who are buyers in good faith. The motion was denied so was the Motion for Reconsideration. This resulted to the respondents filing of a special civil action for certiorari with the CA. In its resolution, the CA denied due course and dismissed respondents' petition for certiorari. Respondents filed a motion for reconsideration, but the same was denied by the CA.

Meanwhile, on August 2000, petitioners, by leave of court, filed an Amended Complaint to include the assessed value of the subject property. Respondents filed a Motion to Dismiss Amended Complaint on the same grounds as the first case. On 2004, the RTC issued an Order denying respondents' Motion to Dismiss Amended Complaint. Respondents filed a motion for reconsideration, but the RTC denied it. Respondents then filed a special civil action for certiorari with the CA praying that the Orders of the RTC be set aside and petitioners' complaint dismissed. The CA ruled that respondents' title has become indefeasible and incontrovertible by lapse of time and that petitioners' action is already barred by prescription. The CA also held that since petitioners did not allege that respondents were not buyers in good faith, the latter are presumed to be purchasers in good faith and for value.

ISSUE:

Whether or not the Court of Appeals erred in ordering the Regional Trial Court to dismiss the case and enjoining it from proceeding with the case on the ground of indefeasibility of title, prescription and/or laches

HELD:

With particular reference to the Espinas’, We observed that there is no allegation at all in Mercado’s complaint that the Espinas’ are buyers or transferees in bad faith or with notice of the alleged defect in the title of their vendor/s with the result that the allegations of said pleading are not sufficient to constitute a cause of action. There is no allegation whatsoever as to the fraudulent nature of the succeeding transfers or of the succeeding transferee's knowledge about the irregularity and defect of the first sale. Most importantly, the complaint contains no averment that the Espinas’ had any knowledge, much less any participation, voluntarily or otherwise, in the alleged irregularity or anomaly of the original sale transaction between Santiago and Escolastico Mercado or in the acquisition/issuance of the OCT. Neither was there any allegation in the complaint attributing Espinas’ with negligence and such cannot also be presumed.

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Where the complaint for recovery of ownership and possession of a parcel of land, alleges that some of the defendants bought said land from their co-defendants who had a defective title thereto – but does not allege that the purchasers were purchasers in bad faith or with notice of the defect in the title of their vendors, it is held that the lower court correctly dismissed the complaint against the purchasers for failure to state a cause of action against them.

If the allegations in the complaint do not aver the concurrence of these elements, the complaint becomes vulnerable to a motion to dismiss on the ground of failure to state a cause of action. A perusal of the Amended Complaint in the present case would show that there is, indeed, no allegation of any act or omission on the part of respondents which supposedly violated the legal rights of petitioners. Thus, the CA is correct in dismissing the complaint on the ground of failure to state a cause of action.

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GALAMGAM, JOHN CARLOS T.

SPOUSES ALFONSO & MARIA CUSI VS LILIA DOMINGO (G.R. NO. 195825) FEBRUARY 27, 2013

RAMONA LIZA DE VERA VS LILIA DOMINGO AND SPOUSES RADELIA & ALFRED SY

(G.R. NO. 195871) FEBRUARY 27, 2013

Under the Torrens System of land registration, the registered owner of realty cannot be deprived of her property through fraud, unless a transferee

acquires the property as an innocent purchaser for value. A transferee who acquires the property covered by a reissued owner’s copy of the certificate of title without taking the ordinary precautions of honest persons in doing

business and examining the records of the proper registry of deeds, or who fails to pay the full market value of the property is not considered an

innocent purchaser for value.

FACTS: 

Respondent Lilia V. Domingo was the owner of the lot in dispute covered under Transfer Certificate of Title (TCT) No. N-165606.On July 18, 1997, without her consent, Radelia Sy (Sy) petitioned before the RTC for reissuance of new owner’s copy and, as proof, presented a deed of sale dated July 14, 1997 executed by Domingo in her favor, and an affidavit of loss dated July 17, 1997, stating that her bag containing the owner’s copy of TCT No. N-165606 had been snatched while she was at the SM City, North EDSA.

After the RTC granted the petition, the Register of Deeds cancelled the TCT No. N-165606 and issued a new TCT No. 186142 in favor of Sy by virtue of the deed of absolute sale date July 14, 1997.  Sy immediately subdivided

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the property and sold each half to Spouses De Vera and Spouses Cusi, and were issued TCT Nos. 189568 and 189569 respectively, annotated on the TCT a consideration of only Php 1M each but the entire lot had an actual value of not less than Php 14M. 

It was only on July 1999 when the respondent learned the situation. She filed an action against Spouses Sy, Spouses De Vera, and the Spouses Cusi seeking annulment of titles, injunction, and damages.  She also applied for the issuance of writ of preliminary prohibition and mandatory injunction, and a temporary restraining order (TRO).

  The RTC granted her application, however, the title of Spouses De Vera and Spouses Cusi remain valid as they were held purchasers in good faith.  Dissatisfied with the decision, Domingo filed a motion for reconsideration. The RTC set aside its first decision and declaring the sale between the respondent and Sy void; the buyers were not purchasers in good faith; cancellation of TCT Nos. 189568 and 189569; the TCT No. 165606 shall be revalidated in the name of Domingo. 

This decision was brought up to the CA filed by the petitioners but was denied.  A motion for reconsideration was also filed but the same was denied. Hence, this petition.

ISSUE:

Whether or not spouses De Vera and Spouses Cusi were innocent purchaser for value and in good faith

HELD:

The petitioners were NOT purchasers in good faith.

Under the Torrens System of land registration, “a person dealing in the registered land has the right to rely on the Torrens certificate title and to dispense with the need of inquiring further, except when the party has actual knowledge of facts and circumstances that would impel a reasonably cautious man to make such inquiry.”

Their observance of a certain degree of diligence within the context of the principles underlying the Torrens System was not the only barometer for them to verify the acquisition of title. Under the law and jurisprudence, it was not enough for them to show that the property was unfenced and vacant nor it was safe for them to rely on the face of Sy’s TCT No. 186142 because they

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were aware that the TCT was derived only from a duplicate owner’s copy reissued by virtue of the loss of the original duplicate owner’s copy.  That circumstance should have already alerted them to the need to inquire beyond the face of the Sy’s TCT.  Other circumstances that would impel a reasonably cautious man to make such inquiry in dealing with the property are the almost simultaneous transactions affecting the acquisition of the property that the petitioners were also aware of and the material, undervaluation of the property in the deed of sale, e.i. the price in consideration of the property of Php 1M each half when the market value is at least Php 14Mostensibly at the request of Sy to minimize her liabilities for Capital Gains Tax.

CHAVEZ, RAPHAEL MARI

REPUBLIC OF THE PHILIPPINES V. MARTIN NG(G.R. NO. 182449) MARCH 6, 2013

Tax declarations and realty tax payments on property are not conclusive evidence of ownership; they are nevertheless good indicia of possession in the concept of owner, for no one in the right frame of mind would be paying

taxes for a property that is not in one’s actual or at least constructive possession.

FACTS:

On 7 January 1997, respondent filed an application for the original registration of title over several parcels of land in Cansaga, Consolacion, Cebu. He claimed ownership of the lands and was based on his purchase from the vendors, who had possessed the realties for more than 30 years. During the reception of evidence, respondent furnished several Deeds of Sale and attached numerous vintage Tax Declarations dating as far back as 1948. The regularity and due execution of the contracts, Tax Declarations and realty payments were never assailed by the petitioner. Respondent also submitted the following documents to prove his ownership: (1) The DENR Certification showing that the subject lands were within the alienable and disposable lands of the public domain. (2) DENR Certification stating that the subject lands were not covered by any other subsisting public land application. As for testimonial evidence, respondent narrated that these lots

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purchased from the aforementioned vendees and predecessors-in-interest, who had been in possession of the lots for more than thirty (30) years. In support of his claims, he further presented the testimony of the 77-year-old Josefa N. Fat (Fat), who lived near the subject lots. After the presentation of evidence, the MTC rendered its decision confirming the respondent’s title and ordering the registration of the title in his name. As represented by the OSG, petitioner appealed to the CA. It averred that the trial court erred since the respondent failed to comply with the requirements for the original registration of title. CA affirmed the decision of the trial court on the ground that the possession of the subject lands covered a period of 49 years to the time of filing of the application in which they have acquired an imperfect title thereto which may be subject to confirmation and brought under the operation of the Torrens System. Aggrieved, petitioner reiterates its lone assignment of error before the SC.

ISSUE:

Whether or not the evidence submitted by the respondent is sufficient to prove that the possession was in the nature required by the Public Land Act and Property Registration Decree.

HELD:

In a judicial confirmation of title under original registration proceedings, applicants may obtain the registration of title to land upon a showing that they or their predecessors-in-interest have been in (1) open, continuous, exclusive, and notorious possession and occupation of (2) agricultural lands of the public domain, (3) under a bona fide claim of acquisition or ownership, (4) for at least 30 years immediately preceding the filing of the application for confirmation of title, except when prevented by war or force majeure. As we have ruled in Republic v. Sta. Ana-Burgos, while tax declarations and realty tax payments on property are not conclusive evidence of ownership, they are nevertheless good indicia of possession in the concept of owner, for no one in the right frame of mind would be paying taxes for a property that is not in one’s actual or at least constructive possession. The voluntary declaration of a piece of property for taxation purposes is an announcement of one’s claim against the State and all other interested parties. In fact, these documents already constitute prima facie evidence of possession. Moreover, if the holders of the land present a deed of conveyance in their favor from its former owner to support their claim of ownership, the declaration of ownership and tax receipts relative to the

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property may be used to prove their good faith in occupying and possessing it. Additionally, when considered with actual possession of the property, tax receipts constitute evidence of great value in support of the claim of title of ownership by prescription.

Therefore, given these pieces of documentary evidence – consisting of muniments of title, tax declarations and realty payments which were not disputed by petitioner; and the testimony as regards the actual possession for more than 30 years by respondent’s predecessors-in-interest – the OSG inaccurately portrayed respondent as merely making general submissions in proving his claims. Rather, as found by the courts a quo, he amply established that he and his predecessors-in-interest owned and possessed the subject lots openly, continuously, exclusively, and notoriously, as required by our registration laws.

LOPEZ, RYAN ANGELO

NEMESIO FIRAZA, SR., VS. SPOUSES CLAUDIO AND EUFRECENA UGAY,

(G.R. NO. 165838) APRIL 3, 2013

A certificate of title shall not be subject to collateral attack. It cannot be altered, modified or cancelled except in direct proceedings in accordance

with law.

FACTS:

Case was commenced by a complaint for Quieting of Title filed by the spouses ugay who alleged that they are the registered owners of Lot No. 2887-A as showed by Original Certificate of Title (OCT) No. P-16080. The complaint prayed for the annulment of Tax Declaration No. C-22-0857 dated 18 of February 1993 issued in the name of the Nemesio Firaza Sr. on the ground that it creates a cloud upon the respondents’ title.

Nemesio Firaza set up the affirmative defense that the spouses Ugay obtained their title through fraud and misrepresentation perpetrated during the processing of their Free Patent Application before the Office of the Community Environment and Natural Resources Officer of Bayugan, Agusan

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del Sur. Firaza also alleged that the spouses purportedly connived with Land Management Officer Lourdes Tadem who favorably recommended their application despite the petitioner’s prior claim and continuous possession of the subject lot.

Firaza before the RTC, contest and prayed for nullification of OCT produced by the spouses, reconveyance to him of the ownership of the subject lot; and payment of moral and exemplary damages, and attorney’s fees.

On August 20, 2001, the RTC issued an Order disallowing any issue pertaining to the petitioner’s counterclaim which in turn was adjudged as a direct attack to the validity of the respondents’ title.

When his motion for reconsideration was denied by the RTC on July 2, 2002, Firaza sought recourse with the CA by filing special civil action for certiorari. The CA affirmed the RTC’s judgment though premised on the different finding that the petitioner’s counterclaim was a collateral attack to the validity of the respondent’s title.

The CA stated that Firaza’s attempt to introduce evidence on the alleged fraud committed by the spouses Ugay in securing their title to the subject land constitutes a collateral attack on the title which is not allowed by law.

ISSUES:

1. Whether or not the petitioner’s counterclaim constitutes a collateral attack of the respondents’ land title and thus bars the former from introducing evidence thereon in the latter’s civil action for quieting of title?

2. Whether or not the RTC is correct to deny the petition of Firaza, and the CA to affirm the decision of the former?

HELD:

Section 48 of Presidential Decree No. 1529 or the Property Registration Decree proscribes a collateral attack to a certificate of title and allows only a direct attack thereof. Under the said provision, a certificate of title shall not be subject to collateral attack. It cannot be altered, modified or cancelled except in direct proceedings in accordance with law.

In one case at the bar, the attack is considered direct when the object of an action is to annul or set aside such proceeding, or enjoin its enforcement. Conversely, an attack is indirect or collateral when, in an action to obtain a different relief, an attack on the proceeding is nevertheless

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made as an incident thereof. Such action to attack a certificate of title may be an original action or a counterclaim, in which a certificate of title is assailed as void.

The court also ruled that a counterclaim is essentially a complaint filed by the defendant against the plaintiff and stands on the same footing as an independent action. From the foregoing, it is immediately apparent that the courts a quo erred in their conclusion. The CA erroneously classified the herein counterclaim as a collateral attack. On the other hand, the RTC correctly adjudged the same as a direct attack to the respondents’ land title but mistakenly declared it as a prohibited action.

The SC, upon appeal of the petitioner, grants the petition. The SC ordered the CA and the RTC to reversed and set aside its decision and ordered the same court to proceed with the trial of the case and to allow petitioner Firaza, to propound questions pertaining to' the validity of Original Certificate of Title No. P-16080 and present such other evidence, testimonial or documentary, substantiating his counterclaim.

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