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Republic of the Philippines

Supreme Court
Manila
THIRD DIVISION
HEIRS OF ANACLETO B. NIETO, namely,
SIXTA P. NIETO, EULALIO P. NIETO,
GAUDENCIO P. NIETO, and CORAZON P.
NIETO-IGNACIO, represented by EULALIO
P. NIETO,
Petitioners,
- versus MUNICIPALITY OF MEYCAUAYAN,
BULACAN, represented by MAYOR
EDUARDO ALARILLA,
Respondent.

G.R. No. 150654


Present:
YNARES-SANTIAGO, J.,

Chairperson,

AUSTRIA-MARTINEZ,
CHICO-NAZARIO,
NACHURA, and
REYES, JJ.

Promulgated:
December 13, 2007

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DECISION
NACHURA, J.:
This is a petition for review on certiorari of the Decision[1] of the Court of Appeals,
dated October 30, 2001, which dismissed the petition for review of the Decision of the
Regional Trial Court (RTC) of Malolos, Bulacan. The latter dismissed a complaint to recover
possession of a registered land on the ground of prescription and laches.
The antecedents are as follows:
Anacleto Nieto was the registered owner of a parcel of land, consisting of 3,882
square meters, situated at Poblacion, Meycauayan, Bulacan and covered by TCT No. T24.055 (M). The property is being used by respondent, Municipality of Meycauayan,
Bulacan, which constructed an extension of the public market therein.

Upon Anacletos death on July 26, 1993, his wife, Sixta P. Nieto, and their three
children, namely, Eulalio P. Nieto, Gaudencio Nieto and Corazon Nieto-Ignacio, herein
petitioners, collated all the documents pertaining to his estate. When petitioners failed to
locate the owners duplicate copy of TCT No. T-24.055 (M), they filed a petition for the
issuance of a second owners copy with the RTC, Malolos, Bulacan. In that case, petitioners
discovered that the missing copy of the title was in the possession of the respondent.
Consequently, petitioners withdrew the petition and demanded from respondent the return
of property and the certificate of title.
On February 23, 1994, petitioners formally demanded from respondent the return of
the possession and full control of the property, and payment of a monthly rent with interest
from January 1964. Respondent did not comply with petitioners demand.[2]
On December 28, 1994, petitioners filed a complaint[3] for recovery of possession and
damages against respondent alleging that the latter was in possession of the owners copy
of TCT No. T-24.055 (M). They averred that, in 1966, respondent occupied the subject
property by making it appear that it would expropriate the same. Respondent then used the
land as a public market site and leased the stalls therein to several persons without paying
Anacleto Nieto the value of the land or rent therefor. Petitioners prayed that respondent be
ordered to surrender to them the owners copy of TCT No. T-24.055 (M), vacate the
property, and pay them the rents thereon from 1966 until the date of the filing of the
complaint for the total of P1,716,000.00, and P10,000.00 a month thereafter, as well
as P300,000.00 as moral damages, and P100,000.00 as attorneys fees.
In its Answer,[4] respondent alleged that the property was donated to it and that the
action was already time-barred because 32 years had elapsed since it possessed the
property.
Respondent and counsel failed to appear during the scheduled pre-trial
conference.[5] Upon petitioners motion, respondent was declared as in default and
petitioners were allowed to present evidence ex parte. Respondent filed a motion for
reconsideration which the RTC granted. Respondent was then allowed to cross-examine
petitioners lone witness and present its own evidence. However, despite notice, respondent
failed again to appear during the scheduled hearing. Hence, the RTC considered respondent
to have waived its right to cross-examine petitioners witness and present its own evidence.
The case was then submitted for decision.
On August 1, 1995, the RTC rendered a Decision dismissing the complaint as well as
respondents counterclaims for damages. For lack of proof, the RTC disregarded
respondents claim that Anacleto Nieto donated the property to it in light of the fact that the
title remained in the name of Anacleto. Nonetheless, the RTC did not rule in favor of
petitioners because of its finding that the case was already barred by prescription. It held

that the imprescriptibility of actions to recover land covered by the Torrens System could
only be invoked by the registered owner, Anacleto Nieto, and that the action was also
barred by laches.

Petitioners appealed the case to the Court of Appeals (CA). On October 30, 2001,
the CA rendered a Decision dismissing the case for lack of jurisdiction. According to the CA,
the petition involved a pure question of law; hence, petitioners should have filed a petition
directly with this Court.[6]
Accordingly, petitioners elevated the case to this Court through a petition for review
on certiorari, raising the following issues:
A. Are lands covered by the Torrens System subject to prescription?
B. May the defense of [l]aches be invoked in this specific case?
C. May the defense of imprescriptibility only be invoked by the registered
owner to the exclusion of his legitimate heirs?[7]

The petition is meritorious.

Respondent argues that the action of petitioner to recover possession of the


property is already barred by prescription.

We do not agree.

An action to recover possession of a registered land never prescribes in view of the


provision of Section 44 of Act No. 496 to the effect that no title to registered land in
derogation of that of a registered owner shall be acquired by prescription or adverse
possession.[8] It follows that an action by the registered owner to recover a real property
registered under the Torrens System does not prescribe.

Despite knowledge of this avowed doctrine, the trial court ruled that petitioners
cause of action had already prescribed on the ground that the imprescriptibility to recover
lands registered under the Torrens System can only be invoked by the person under whose
name the land is registered.

Again, we do not agree. It is well settled that the rule on imprescriptibility of


registered lands not only applies to the registered owner but extends to the heirs of the
registered owner as well.[9] Recently in Mateo v. Diaz,[10] the Court held that prescription is
unavailing not only against the registered owner, but also against his hereditary successors
because the latter step into the shoes of the decedent by operation of law and are the
continuation of the personality of their predecessor-in-interest. Hence, petitioners, as heirs
of Anacleto Nieto, the registered owner, cannot be barred by prescription from claiming the
property.
Aside from finding that petitioners cause of action was barred by prescription, the
trial court reinforced its dismissal of the case by holding that the action was likewise barred
by laches.

Laches has been defined as the failure or neglect, for an unreasonable and
unexplained length of time, to do that which, by exercising due diligence could or should
have been done earlier. It is negligence or omission to assert a right within a reasonable
time, warranting the presumption that the party entitled to assert his right has either
abandoned or declined to assert it.[11]

In a number of cases, the Court has held that an action to recover registered land
covered by the Torrens System may not be barred by laches.[12] Laches cannot be set up to
resist the enforcement of an imprescriptible legal right.[13] Laches, which is a principle based
on equity, may not prevail against a specific provision of law, because equity, which has
been defined as justice outside legality, is applied in the absence of and not against
statutory law or rules of procedure.[14]
In recent cases, [15] however, the Court held that while it is true that a Torrens title is
indefeasible and imprescriptible, the registered landowner may lose his right to recover
possession of his registered property by reason of laches.

Yet, even if we apply the doctrine of laches to registered lands, it would still not bar
petitioners claim. It should be stressed that laches is not concerned only with the mere
lapse of time.[16] The following elements must be present in order to constitute laches:
(1) conduct on the part of the defendant, or of one under whom he claims,
giving rise to the situation of which complaint is made for which the
complaint seeks a remedy;
(2) delay in asserting the complainants rights, the complainant having had
knowledge or notice, of the defendants conduct and having been
afforded an opportunity to institute a suit;
(3) lack of knowledge or notice on the part of the defendant that the
complainant would assert the right on which he bases his suit; and
(4) injury or prejudice to the defendant in the event relief is accorded to
the complainant, or the suit is not held to be barred.[17]
We note that the certificate of title in the name of Anacleto Nieto was found in
respondents possession but there was no evidence that ownership of the property was
transferred to the municipality either through a donation or by expropriation, or that any
compensation was paid by respondent for the use of the property. Anacleto allegedly
surrendered the certificate of title to respondent upon the belief that the property would be
expropriated. Absent any showing that this certificate of title was fraudulently obtained by
respondent, it can be presumed that Anacleto voluntarily delivered the same to
respondent. Anacletos delivery of the certificate of title to respondent could, therefore, be
taken to mean acquiescence to respondents plan to expropriate the property, or a tacit
consent to the use of the property pending its expropriation.
This Court has consistently held that those who occupy the land of another at the
latters tolerance or permission, without any contract between them, are necessarily bound
by an implied promise that the occupants will vacate the property upon demand.[18] The
status of the possessor is analogous to that of a lessee or tenant whose term of lease has
expired but whose occupancy continues by tolerance of the owner. In such case, the
unlawful deprivation or withholding of possession is to be counted from the date of the
demand to vacate.[19] Upon the refusal to vacate the property, the owners cause of action
accrues.
In this case, the first element of laches occurred the moment respondent refused to
vacate the property, upon petitioners demand, on February 23, 1994. The filing of the
complaint on December 28, 1994, after the lapse of a period of only ten months, cannot be
considered as unreasonable delay amounting to laches.

Moreover, case law teaches that if the claimants possession of the land is merely
tolerated by its lawful owner, the latters right to recover possession is never barred by
laches. Even if it be supposed that petitioners were aware of respondents occupation of the
property, and regardless of the length of that possession, the lawful owners have a right to
demand the return of their property at any time as long as the possession was unauthorized
or merely tolerated, if at all.[20]
Furthermore, the doctrine of laches cannot be invoked to defeat justice or to
perpetrate fraud and injustice. It is the better rule that courts, under the principle of equity,
will not be guided or bound strictly by the statute of limitations or the doctrine of laches
when by doing so, manifest wrong or injustice would result.[21]
Finally, we find that the rentals being prayed for by petitioners are reasonable
considering the size and location of the subject property. Accordingly, the award of rentals
is warranted.
WHEREFORE, premises considered, the petition is GRANTED. The Decision of the
Regional Trial Court of Malolos, Bulacan, dated August 1, 1995, is REVERSEDand SET
ASIDE. Respondent is ORDERED (a) to vacate and surrender peaceful possession of the
property to petitioners, or pay the reasonable value of the property; (b) to
pay P1,716,000.00 as reasonable compensation for the use of the property from 1966 until
the filing of the complaint and P10,000.00 monthly rental thereafter until it vacates the
property, with 12% interest from the filing of the complaint until fully paid; and (c) to return
to petitioners the duplicate copy of TCT No. T-24.055 (M).
SO ORDERED.

ANTONIO EDUARDO B. NACHURA


Associate Justice
WE CONCUR:
CONSUELO YNARES-SANTIAGO
Associate Justice
Chairperson

MA. ALICIA AUSTRIA-MARTINEZ


Associate Justice

MINITA V. CHICO-NAZARIO
Associate Justice

RUBEN T. REYES
Associate Justice
ATTESTATION
I attest that the conclusions in the above Decision had been reached in consultation
before the case was assigned to the writer of the opinion of the Courts Division.

CONSUELO YNARES-SANTIAGO
Associate Justice
Chairperson, Third Division
CERTIFICATION
Pursuant to Section 13, Article VIII of the Constitution, and the Division
Chairperson's Attestation, I certify that the conclusions in the above decision had been
reached in consultation before the case was assigned to the writer of the opinion of the
Courts Division.

REYNATO S. PUNO
Chief Justice

[1]

Penned by Associate Justice Marina L. Buzon, with Associate Justices


Buenaventura J. Guerrero and Alicia L. Santos, concurring; rollo, pp. 30-39.
[2]
Records, pp. 70-71.
[3]
Id. at 1-4.
[4]
Records, pp. 32-33.
[5]
Rollo, p. 24.
[6]
Id. at 37-38.
[7]
Id. at 11.
[8]
Mateo v. Diaz, 424 Phil. 772, 781 (2002).
[9]
Mateo v. Diaz, supra, at 782; Bailon-Casilao v. Court of Appeals, No. L78178, April 15, 1988, 160 SCRA 738, 747.
[10]
Supra.
[11]
Isabela Colleges, Inc. v. Heirs of Nieves Tolentino-Rivera, 397 Phil. 955, 969
(2000).
[12]
Mateo v. Diaz, supra note 8, at 781; Quevada v. Glorioso, 356 Phil. 105, 119
(1998); Dablo v. Court of Appeals, G.R. No. 93365, September 21, 1993, 226 SCRA 618,

628; Bishop v. Court of Appeals, G.R. No. 86787, May 8, 1992, 208 SCRA 636, 641; Jimenez
v. Fernandez, G.R. No. 46364, April 6, 1990, 184 SCRA 190, 198; Umbay v. Alecha, 220
Phil. 103, 106 (1985); J.M. Tuason & Co., Inc. v. Macalindong, No. L-15398, December 29,
1962, 6 SCRA 938.
[13]
Heirs of Romana Ingjug-Tiro v. Casals, 415 Phil. 665, 674 (2001).
[14]
Mateo v. Diaz, supra note 8, at 781.
[15]
De Vera-Cruz v. Miguel, G.R. No. 144103, August 31, 2005, 468 SCRA 506,
518; Heirs of Juan and Ines Panganiban v. Dayrit, G.R. No. 151235, July 28, 2005, 464
SCRA 370, 379-380; Vda. de Cabrera v. Court of Appeals, 335 Phil. 19, 34 (1997).
[16]
Pineda v. Heirs of Eliseo Guevara, G.R. No. 143188, February 14, 2007, 515
SCRA 627, 635
[17]
Heirs of Juan and Ines Panganiban v. Dayrit, supra note 15, at 382.
[18]
Macasaet v. Macasaet, G.R. Nos. 154391-92, September 30, 2004, 439 SCRA
625, 635.
[19]
Arcal v. Court of Appeals, 348 Phil. 813, 825 (1998).
[20]
Feliciano v. Zaldivar, G.R. No. 162593, September 26, 2006, 503 SCRA 182,
201.
[21]
Heirs of Dumaliang v. Serban, G.R. No. 155133, February 21, 2007, 516 SCRA
343, 356.