G.R. No.

L-21381 April 5, 1924

SANTIAGO QUIMSON, plaintiff-appellee,

vs.
PABLO SUAREZ, defendant-appellant.

Camus and Delgado and Jose Serapio for appellant.

Jose Bernabe for appellee.

OSTRAND, J.:

This is an action of forcible entry and detainer, the plaintiff alleging that he is entitled to the
possession of the land in question under a lease from its owner and that the defendant is wrongfully
withholding it from him. The defendant maintains that he is lawfully in possession under another
lease of an earlier date from the same owner.

It appears from the evidence that on February 28, 1917, the deceased Pablo Tecson leased a large
fishpond situated in the municipality of Orani, Province of Bataan, to one David Luna for the term of
ten years at an annual rent of P900. Two months later Luna, with the consent of Tecson, assigned
the lease to Pablo Suarez, the defendant herein. Shortly afterwards Tecson applied for the
registration of the land under Act No. 496, but died before the final disposal of the case and the final
decree and corresponding certificate of title were issued in the names of Esperanza Tongco de
Trias, as administratrix of Tecson's estate, and Maximiana Tongco, his widow, in equal shares.
Neither in the final decree nor in the certificate of title was any mention made of the lease in favor of
Suarez.

Esperanza Tongco de Trias appears to have been succeeded as administratrix by Maximiana

Tongco and the latter as such administratrix, and as guardian of the heirs of Tecson, and also in her
own behalf, granted a lease of the land to the plaintiff Quimson. The lease is dated May 23, 1920,
and is for the term of six years from May 1, 1921, the rent for the entire term being fixed at P6,250,
payable at the time of the execution of the lease. This lease was at once entered by memorandum
upon the certificate of title for the land. At the time of the execution of the lease the plaintiff knew that
the defendant Suarez was in possession of the land as a tenant of Maximiana Tongco, by whom he
had been told that the term of Suarez' lease expired on March 1, 1921, and there is no evidence
showing that he had notice of the fact that the term extended beyond that date.

On November 15, 1920, Suarez brought an action in the Court of First Instance against Quimson
and Maximiana Tongco to have Quimson's lease set aside. As far as the record shows the action
may still be pending.

On May 1, 1921, Quimson made a formal demand upon Suarez for the surrender of the possession
and the demand not being complied with, the present action was brought in the court of the justice of
the peace of Orani, the complaint being filed May 6, 1921. The defendant objected formally to the
jurisdiction of the court on the ground that the action was in reality not one of forcible entry and
unlawful detainer, and therefore not within the jurisdiction of the justice of the peace. The court
overruled the objection, took cognizance of the case, and rendered judgment in favor of the plaintiff
ordering the defendant to vacate the land and to pay damages in the sum of P280.

The defendant appealed to the Court of First Instance where he appeared specially and presented a
motion for the dismissal of the complaint on the same grounds as those urged in support of his
objection to the jurisdiction of the justice of the peace. The motion was denied.
The case was placed on the calendar for June 22, 1922, but was continued on motion of the
defendant. It was again set for trial on August 11, 1922, and plaintiff appeared accompanied by his
counsel; the defendant also appeared and presented another motion for a continuance on the
ground that his counsel had a case for trial in another court and was unable to appear in the present
case on that date. The court denied the motion and proceeded with the trial, at which trial the
defendant testified in his own behalf. The court thereupon rendered judgment in favor of the plaintiff
for the possession of the land and the sum of P590 in damages, with costs, and the case is now
before us upon appeal by the defendant from that judgment.

The appellant presents three assignments of error, viz.:

(a) The trial court erred in overstepping its discretionary powers by denying the petition for
postponement of the trial filed by the defendant on August 9, 1922.

(b) The trial court erred in overruling the motion for dismissal presented by the defendant on
the ground that the Court of First Instance of Bataan had no jurisdiction to take cognizance of
this case on appeal.

(c) The trial court erred in holding that the right of possession of the defendant to the land
described in paragraph 1 of the complaint was extinguished on April 30, 1921; and in
adjudging that the contract of lease, Exhibit 4 of the defendant, is null and void for not having
been noted on the corresponding certificate of title.

(1) There is no merit in the first assignment of error. The defendant had already been
granted a continuance of the case and failed to give plaintiff's counsel due notice of the
second motion for a continuance, thus causing the latter the expense and trouble of going
from Manila to Balanga. Under the circumstances, the denial of the second motion certainly
did not constitute abuse of discretion.

(2) Neither can the second assignment of error be sustained. The defendant argues that the
action is not one of forcible entry and detainer as defined in section 80 of the Code of Civil
Procedure. The pertinent part of that section reads as follows:

Anyone deprived of the possession of any land or building by force, intimidation, threat, strategy, or
stealth, and any landlord, vendor, vendee, or other person against whom the possession of any land
or building is unlawfully withheld after the expiration or determination of the right to hold possession,
by virtue of any contract, express or implied, and the legal representatives or assigns of any such
landlord, vendor, vendee, or other person, shall at any time within one year after such unlawful
deprivation or withholding of possession be entitled, as against the person or persons unlawfully
withholding or depriving of possession, or against any person or persons claiming under them, to
restitution of the land, building, and premises possession of which is unlawfully withheld, together
with damages and costs. . . .

The complaint alleges that the plaintiff has been entitled to the possession of the land since May,
1921; that the defendant's right of possession expired April 30, 1921; and that the defendant is
illegally withholding the possession from the plaintiff. These allegations bring the case squarely
within the section quoted and, if so, the justice of the peace had original jurisdiction. The authorities
cited by the defendant in support of his contention are so clearly inapplicable to this case that a
discussion of them seems unnecessary.
 (3) The third assignment of error relates to the principal question in the case, i.e., the
determination of the legal effect of the two leases and of their relative priority. As we have
already stated, the land in question is registered under Act No. 496. The plaintiff's lease is
duly entered upon the certificate of title; the defendant's lease, though prior in date, has
never been registered, nor is any intimation of its existence to be found upon the certificate
of title. At the time the plaintiff entered into his contract of lease, he had knowledge of the
fact that the defendant was in physical possession of the land and if the land were
unregistered this would be sufficient to put him upon inquiry and charge him with constructive
notice of the defendant's rights.

But here the land is registered and in regard to such lands as unrecorded lease operates only as a
contract between the parties and does not affect the rights of third parties in the absence of fraud on
their part. Inasmuch as sales, mortgages and leases stand on the same footing in this respect, the
following quotation from Niblack on the Torrens System, p. 222, citing Independent Lumber Co. vs.
Gardiner (3 Sask., 140), is in point:

The rule relative to the protection which will be afforded by a new registration is that a
purchaser for value will be protected in his registered interests unless actual and moral fraud
on his part is to be inferred from the circumstances under which he obtained them. A person
taking a mortgage from a registered owner of land is not affected by notice of an
unregistered interest in another person, whereby such person is the owner of an undivided
one-half of the land, but if the mortgagor, when he executed it, expressly told the mortgagee
that he owned only an undivided one-half of the land, that he only intended to mortgage his
one-half, and that he intended to exempt the interest of his cotenant, the mortgagee is guilty
of fraud against the unregistered owner in attempting to enforce the mortgage against the
whole land. Fraud on the part of a vendor in acquiring his title cannot affect the statutory
protection and indefeasibility of title given to a registered purchaser for value, who had no
part in or knowledge of the fraud. This rule is the same as in case of original registration.

One of the principal features of the Torrens System of registration is that all incumbrances on the
land or special estates therein shall be shown, or, at least, intimated upon the certificate of title and a
person dealing with the owner of the registered land is not bound to go behind the certificate and
inquire into transactions, the existence of which is not there intimated. There being in the present
case not indication on the certificate of title of the existence of the defendant's lease, and the
certificate therefore showing a clear title and right of possession in favor of the lessor, the plaintiff
had a perfect right to rely on the lessor's statement that defendant's right of possession terminated
on April 30, 1921, and was not bound to make further inquiries. He can, therefore, not be charged
with fraud neither actual nor constructive.

The disadvantages of adopting the rule suggested by the appellant would far outweigh the
advantages, would be out of harmony with the underlying principles of the Torrens System of
registration and would tend to impair the value of registered titles.

The judgment appealed from is therefore affirmed, with the costs against the appellant. So ordered.

Araullo, C.J., Johnson, Avanceña and Romualdez, JJ., concur.

Street, J., dissents.

Separate Opinions
JOHNS, J., dissenting:

I dissent.

At the time the plaintiff took his lease, he personally knew that the defendant was in the actual
physical possession of the property, and had been for a number of years. The fact that the plaintiff
had personal knowledge of such fact was sufficient to put him upon notice of defendant's rights, and
to legally charge him with knowledge of any information, which he might received upon inquiry from
the defendant as to the tenure of his lease.

The only object of the registration law is to give a party notice of the rights of third parties, and if he
has personal knowledge of such rights, or such notice as to put him upon inquiry, as in this case, he
is not in a position to say that he took the lease without knowledge of defendant's rights.

Upon that ground, I dissent.

G.R. No. L-9940 March 30, 1960

AVELINO REVILLA and ELENA FAJARDO, plaintiffs-appellants,

vs.
GODOFREDO GALINDEZ, defendant-appellee.

Vergara and Associates for appellants.

Lauro O. Sansano for appellee.

GUTIERREZ DAVID, J.:

In the complaint they filed in the Court of First Instance of Nueva Ecija, Avelino Revilla, and Elena
Fajardo are seeking to recover the possession of a parcel of land, now known as Lot No. 659-A,
subdivision plan Psd-28954, but which used to be the southwestern portion of Lot No. 659 of the
cadastral survey of Rizal, Nueva Ecija. This latter lot was formerly registered in the name of Alipio
Gasmeña as per T.C.T. No. 7454 (Exhibit 4). On May 18, 1938, Alipio Gasmeña donated to
Florencio Gasmeña said southwestern portion of the lot, with an area of 1.8144 hectares (Exhibit 5).
The donation was duly annotated on the certificates of title. On May 21, 1938, Florencio Gasmeña
mortgaged his unsegregated portion to Godofredo Galindez, defendant-appellee herein, for the sum
of P350.00 (Exhibit 8); and on October 5, 1938 sold it outright to defendant-appellee (Exhibit 7). The
mortgage was registered and a memorandum thereof entered on T.C.T. No. 7454, but the
subsequent sale was never registered. However, from the date of the mortgage, defendant-appellee
had been in possession of the property.

Several years after Florencio Gasmeña's death in 1941, the portion which he had conveyed to
defendant-appellee was segregated and designated as Lot No. 659-A. On August 28, 1950, T.C.T.
No. NT-7782, covering Lot No. 659-A, was issued in the name of the already deceased Florencio
Gasmeña. This certificate of title carried no annotation of the registered mortgage in favor of
defendant-appellee. On September 20, 1950, the widow and heirs of Florencio Gasmeña executed a
deed of extrajudicial partition with sale (Exhibit B) wherein they declared that on November 15, 1941,
Florencio Gasmeña died intestate, without debts and possessed solely of Lot No. 659-A, which lot
they adjudicated to themselves and then sold for P2,000.00 to plaintiff-appellants. Before they
purchased the land, plaintiff-appellants had examined Florencio Gasmeña's title and had found no
encumbrance noted thereon. The deed of extrajudicial partition with sale was registered, so T.C.T.
No. NT-7782 in the name of Florencio Gasmeña was cancelled, and in lieu thereof T.C.T. No. NT-
7938 was issued to plaintiffs-appellants subject to the provisions of Sections 4 and 5 of Rule 74,
Rules of Court. Plaintiffs-appellants attempted to take possession of the land, but defendant-
appellee's overseer informed them that defendant-appellee had previously purchased it from
Florencio Gasmeña. Defendant-appellee's refusal to relinquish possession of the lot prompted
plaintiffs-appellants to commence this action.

The lower court, after trial, rendered judgment declaring the deed of extrajudicial partition with sale
(Exhibit B) null and void and ordering the Register of Deeds to cancel T.C.T. No. NT-7938.

Raising questions purely of law, plaintiffs have appealed directly to this Court.

We have here a case of registered land which had been sold to two different persons. Where the
same immovable property is sold to different vendees, the property shall belong to the one who first
recorded it in the Registry of Deeds (Article 1544, N.C.C., Article 1473, O.C.C.). This rule covers all
kinds of immovables, including land, and makes no distinction as to whether the immovable is
registered or not. But in so far as registered land is concerned said rule is in perfect accord with the
Land Registration Act, Section 50 of which provides that no deed, mortgage, lease or other voluntary
instrument except a will, purporting to convey or affect registered land shall take effect as a
conveyance or bind the land until its registration.

The first sale was in favor of defendant-appellee, and never registered, although from the time the
land was mortgaged to him up to the present, he has been in uninterrupted possession of the land.
But since we are dealing with registered land, title to which is imprescriptible (Section 46, Act 496),
defendant-appellee certainly cannot claim title by acquisitive prescription. To successfully bind the
land, he should have registered the sale in his favor. By reason of his failure to do so, the sale
operated only as a contract between him and the vendor, Florencio Gasmeña, and as evidence of
authority to the Register of Deeds to make registration (Section 50, Act 496; Buzon vs. Licauco, 13
Phil., 354; Worcester vs. Ocampo, 34 Phil., 646; Fidelity and Surety Co. vs. Conegero, 41 Phil.,
396). Florencio Gasmeña and his heirs were bound to respect the contract, but innocent third
persons cannot be affected thereby. From the time Florencio Gasmeña acquired the questioned lot
up to the time of his death (and even for nine years thereafter), there was an annotation on Alipio
Gasmeña's certificate of title to the effect that said portion of land had been conveyed to Florencio
Gasmeña. Hence, from the viewpoint of third persons, Florencio Gasmeña was still the owner even
after the unregistered sale to defendant-appellee. And it follows that if Florencio Gasmeña had been
of a mind to sell the land, he could have subsequently sold it and could still have passed good title to
an innocent purchaser for value, subject, of course, to the registered mortgage in favor of defendant-
appellee.

One of the main features of the Torrens system of registration is that all encumbrances on the land
or special estates therein shall be shown, or at least intimated upon the certificate of title and a
person dealing with the owner of the registered land is not bound to go behind the certificate and
inquire into transactions, the existence of which is not there intimated (Quimson vs. Suarez, 45 Phil.,
901); but he is only charged with notice of the burdens on the property which are noted on the face
of the register or on the certificate of title (Anderson and Co. vs. Garcia, 64 Phil., 506). The Torrens
system seeks to insure the efficacy and conclusiveness of the certificate of title. To enhance this aim
we thus have the provision that every person receiving a certificate of title in pursuance of a degree
of registration, and every subsequent purchaser of registered land who takes certificate of title for
value in good faith shall hold the same free of all incumbrances except those noted on said
certificate (Section 39, Act 496).

Unquestionably, the sale in favor of plaintiffs-appellants was a registered one, and a certificate of
title was issued to them. The point of inquiry is whether they are purchasers in good faith. It is true
that before they bought the lot they had first examined the certificate of title of Florencio Gasmeña
and had found it absolutely clean in the sense that there was no annotation of any encumbrance.
But one fact stands out just as clearly. Plaintiffs-appellants did not buy the land from the registered
owner, Florencio Gasmeña. They bought it from his heirs.

The law protects to a greater degree a purchaser who buys from the registered owner himself.
Corollarily, it requires a higher degree of prudence from one who buys from a person who is not the
registered owner, although the land object of the transaction is registered. While one who buys from
the registered owner does not need to look behind the certificate of title, one who buys from one who
is not the registered owner is expected to examine not only the certificate of title but all factual
circumstances necessary for him to determine if there are any flaws in the title of the transferor, or in
his capacity to transfer the land.

This Court has consistently applied the stricter rule when it comes to deciding the issue of good faith
of one who buys from one who is not the registered owner, but who exhibits a certificate of title.
This is well illustrated in Veloso and Rosales vs. La Urbana and Del Mar (58 Phil., 681) where this
Court declared that one who deals with the supposed attorney in fact of a registered owner, has the
duty of ascertaining the genuineness of the deed purporting to be a power of attorney, and that
should he fail to determine whether such attorney in fact has the power to dispose of the land, then
he must suffer the consequences and damages resulting from the transaction. One who intends to
purchase registered land, must first make sure that the persons selling it to him is the person named
as owner in the certificate of title, and not an impostor. If he should neglect to ascertain the identity
of the seller, the law will not protect him, should such seller turn out to be an impostor (De Lara and
De Guzman vs. Ayroso, 95 Phil., 185; 50 Off. Gaz., No. 10, 4838). Where a person buys land not
from the registered owner but from one whose right to the land has been merely annotated on the
certificate of title, and such purchaser merely had his deed of sale annotated on the certificate of
title, he is not considered a "subsequent purchaser of registered land who takes certificate of title for
value and in good faith and who is protected against any encumbrance except those noted on said
certificate" (Mirasol vs. Gerochi, 93 Phil., 480).

The problem before us finds a parallel in the case of Mari vs. Bonilla (83 Phil., 137; 46 Off. Gaz.,
4258), where a question also arose respecting the vendees' good faith. In said case, the property
was still in the name of the already deceased Casimiro Evangelista at the time the vendees
purchased it from one of Casimiro's son. This son, Deogracias Evangelista, posing as sole heir of
the deceased, had adjudicated the land to himself and had then sold it to the vendees without first
acquiring a certificate of title in his name. It turned out later that the deceased had other heirs who
sought to recover the property from the vendees. In resolving the question presented, this Court
declared that:

Good faith affords protection only to purchasers for value from the registered owner.
Deogracias Evangelista, defendants' grantor, was not a registered owner. The land was and
still is registered in the name of Casimiro Evangelista. In no way does the certificate state
that Deogracias owned the land; consequently defendants cannot summon to their aid the
theory of indefeasibility of Torrens Title. There is nothing in the certificate and in the
circumstances of the transaction which warrant them in supposing that they need not look
beyond the title. If anything, it would have put them on their guard, cautioned them to
ascertain and verify that the vendor was the only heir of his father, that there was no debt,
and that the latter was the sole owner of the parcel of land.

The above pronouncement may well be made here. Plaintiffs-appellants did not buy the lot from the
registered owner. Thus they were bound at their peril to investigate their transferors' right to sell the
property. Ordinary prudence called for a scrutiny of the deed of extrajudicial partition with sale
(Exhibit B) as well as the transfer certificate in the name of Florencio Gasmeña. Such an
examination would have inevitably revealed to plaintiffs-appellants that Florencio Gasmeña's heirs
allowed almost a decade to pass before they attempted to adjudicate the lot unto themselves, and,
more important, that Florencio Gasmeña had been dead nine years before the lot was segregated
from Lot No. 659 and T.C.T. No. NT-7782 issued in his name. With these facts on hand, any
prospective buyer of the land would have examined the previous transfer certificate of title in the
name of Alipio Gasmeña, T.C.T. No. 7454, and would thus have discovered that at no time during
his life was Florencio Gasrmeña ever the registered owner of said portion of land. The memorandum
of conveyance to him in the certificate of title of Alipio Gasmeña served merely as a notice to third
parties of the fact that said portion had been transferred to Florencio Gasmeña (Section 58, Act No.
496, as amended by Act No. 4029), but it did not have the same effect as a certificate of title issued
to Florencio Gasmeña himself. The doctrine therefore in the Bonilla case applies with more force
herein for neither plaintiffs-appellants transferors nor the latter's predecessor was ever the registered
owner of the lot.
An examination of Alipio Gasmeña's certificate of title would likewise have yielded the fact that said
portion of land had been mortgaged to defendant-appellee. All these circumstances were sufficient
to warn plaintiffs-appellants that their transferors did not have clean title to the land. Their failure to
make the investigations required by the circumstances constitutes lack of good faith. They cannot
now plead ignorance because they had before them facts which would have reasonably impelled an
ordinarily prudent buyer to make an inquiry and to exercise due care.

A purchaser cannot close his eyes to facts which should put a reasonable man upon his
guard, and then claim that he acted in good faith under the belief that there was no defect in
the title of the vendor. His mere refusal to believe that such defect exists, or his willful closing
of his eyes to the possibility of the existence of a defect in his vendor's title, will not make him
an innocent purchaser for value, if it afterwards develops that the title was in fact defective,
and it appears that he had such notice of the defect as would have led to its discovery had
he acted with that measure of precaution which may reasonably be required of a prudent
man in like situation. (Leung Yee vs. F. L. Strong Machinery Co., and Williamson, 37 Phil.,
644).

Not being purchasers in good faith, plaintiffs-appellants are clearly not entitled to the rights of a
registered owner.

Neither of the vendees having registered their respective sales in good faith, their right to the
property must be determined by the priority of possession. Where the same immovable property was
sold to two different persons neither of whom recorded the transfer in good faith, ownership shall
pertain to the person who in good faith was first in the possession (Article 1544, N.C.C.; Article 1473,
O.C.C.). The lot, therefore properly belongs to defendant-appellee.

Having arrived at the foregoing conclusions, we find it unnecessary to discuss the other points raised
by the parties.

Wherefore, the appealed judgment is hereby affirmed with costs against appellants.
THE HEIRS OF MARCELINO G.R. No. 169454
DORONIO, NAMELY: REGINA
AND FLORA, BOTH SURNAMED
DORONIO, Present:
Petitioners,
YNARES-SANTIAGO, J.,
Chairperson,
- versus - AUSTRIA-MARTINEZ,
CHICO-NAZARIO,
NACHURA, and
HEIRS OF FORTUNATO REYES, JJ.
DORONIO, NAMELY: TRINIDAD
ROSALINA DORONIO-BALMES,
MODING DORONIO, FLORENTINA
DORONIO, AND ANICETA Promulgated:
ALCANTARA-MANALO,
Respondents. December 27, 2007
x--------------------------------------------------x

DECISION

REYES, R.T., J.:

For Our review on certiorari is the Decision[1] of the Court of Appeals (CA)
reversing that[2] of the Regional Trial Court (RTC), Branch 45,
Anonas, Urdaneta City, Pangasinan, in an action for reconveyance and
damages. The CA declared respondents as rightful owners of one-half of the
subject property and directed petitioners to execute a registerable document
conveying the same to respondents.

The Facts

Spouses Simeon Doronio and Cornelia Gante, now both deceased, were the
registered owners of a parcel of land located at BarangayCabalitaan, Asingan,
Pangasinan covered by Original Certificate of Title (OCT) No. 352.[3] The courts
below described it as follows:
 Un terreno (Lote 1018), situada en el municipio de Asingan, Linda por
el NE; con propriedad de Gabriel Bernardino; con el SE con propriedad
de Zacarias Najorda y Alejandro Najorda; por el SO con propriedad de
Geminiano Mendoza y por el NO con el camino para Villasis; midiendo
una extension superficial mil ciento cincuenta y dos metros cuadrados.[4]
The spouses had children but the records fail to disclose their number. It is
clear, however, that Marcelino Doronio and Fortunato Doronio, now both
deceased, were among them and that the parties in this case are their
heirs. Petitioners are the heirs of Marcelino Doronio, while respondents are the
heirs of Fortunato Doronio.

On April 24, 1919, a private deed of donation propter nuptias[5] was

executed by spouses Simeon Doronio and Cornelia Gante in favor of Marcelino
Doronio and the latters wife, Veronica Pico. One of the properties subject of said
deed of donation is the one that it described as follows:

Fourth A piece of residential land located in the barrio of

Cabalitian but we did not measure it, the area is bounded on the north by
Gabriel Bernardino; on the east by Fortunato Doronio; on the south by
Geminiano Mendoza and on the west by a road to Villasis. Constructed
on said land is a house of light materials also a part of the dowry. Value
200.00.[6]

It appears that the property described in the deed of donation is the one
covered by OCT No. 352. However, there is a significant discrepancy with respect
to the identity of the owner of adjacent property at the eastern side. Based on OCT
No. 352, the adjacent owners are Zacarias Najorda and Alejandro Najorda,
whereas based on the deed of donation, the owner of the adjacent property is
Fortunato Doronio. Furthermore, said deed of donation remained a private
document as it was never notarized.[7]

Both parties have been occupying the subject land for several
decades[8] although they have different theories regarding its present
ownership. According to petitioners, they are now the owners of the entire property
in view of the private deed of donation propter nuptias in favor of their
predecessors, Marcelino Doronio and Veronica Pico.

Respondents, on the other hand, claim that only half of the property was
actually incorporated in the said deed of donation because it stated that Fortunato
Doronio, instead of Zacarias Najorda and Alejandro Najorda, is the owner of the
adjacent property at the eastern side.Respondents posit that the donors respected
and segregated the possession of Fortunato Doronio of the eastern half of the
land. They are the ones who have been possessing said land occupied by their
predecessor, Fortunato Doronio.

Eager to obtain the entire property, the heirs of Marcelino Doronio and
Veronica Pico filed, on January 11, 1993, before the RTC in Urdaneta, Pangasinan
a petition For the Registration of a Private Deed of Donation[9] docketed as Petition
Case No. U-920. No respondents were named in the said petition[10] although
notices of hearing were posted on the bulletin boards of Barangay Cabalitaan,
Municipalities of Asingan and Lingayen.[11]

During the hearings, no one interposed an objection to the petition.[12] After

the RTC ordered a general default,[13] the petition was eventually granted
on September 22, 1993. This led to the registration of the deed of donation,
cancellation of OCT No. 352 and issuance of a new Transfer Certificate of Title
(TCT) No. 44481 in the names of Marcelino Doronio and Veronica Pico. [14] Thus,
the entire property was titled in the names of petitioners predecessors.

On April 28, 1994, the heirs of Fortunato Doronio filed a pleading before
the RTC in the form of a petition in the same Petition Case No. U-920. The
petition was for the reconsideration of the decision of the RTC that ordered the
registration of the subject deed of donation. It was prayed in the petition that an
order be issued declaring null and void the registration of the private deed of
donation and that TCT No. 44481 be cancelled. However, the petition was
dismissed on May 13, 1994 on the ground that the decision in Petition Case No. U-
920 had already become final as it was not appealed.
 Determined to remain in their possessed property, respondent heirs of
Fortunato Doronio (as plaintiffs) filed an action for reconveyance and damages
with prayer for preliminary injunction[15] against petitioner heirs of Marcelino
Doronio (as defendants) before the RTC, Branch 45, Anonas, Urdaneta City,
Pangasinan. Respondents contended, among others, that the subject land is
different from what was donated as the descriptions of the property under OCT No.
352 and under the private deed of donation were different. They posited that
spouses Simeon Doronio and Cornelia Gante intended to donate only one-half of
the property.

During the pre-trial conference, the parties stipulated, among others, that the
property was originally covered by OCT No. 352 which was cancelled by TCT No.
44481. They also agreed that the issues are: (1) whether or not there was a
variation in the description of the property subject of the private deed of donation
and OCT No. 352; (2) whether or not respondents had acquired one-half of the
property covered by OCT No. 352 by acquisitive prescription; (3) whether or not
the transfer of the whole property covered by OCT No. 352 on the basis of the
registration of the private deed of donation notwithstanding the discrepancy in the
description is valid; (4) whether or not respondents are entitled to damages; and (5)
whether or not TCT No. 44481 is valid.[16]

RTC Decision

After due proceedings, the RTC ruled in favor of petitioner heirs of

Marcelino Doronio (defendants). It concluded that the parties admitted the identity
of the land which they all occupy;[17] that a title once registered under the torrens
system cannot be defeated by adverse, open and notorious possession or by
prescription;[18] that the deed of donation in consideration of the marriage of the
parents of petitioners is valid, hence, it led to the eventual issuance of TCT No.
44481 in the names of said parents;[19] and that respondent heirs of Fortunato
Doronio (plaintiffs) are not entitled to damages as they are not the rightful owners
of the portion of the property they are claiming.[20]

The RTC disposed of the case, thus:

 WHEREFORE, premises considered, the Court hereby renders
judgment DISMISSING the herein Complaint filed by plaintiffs against
defendants.[21]

Disagreeing with the judgment of the RTC, respondents appealed to the

CA. They argued that the trial court erred in not finding that respondents
predecessor-in-interest acquired one-half of the property covered by OCT No. 352
by tradition and/or intestate succession; that the deed of donation dated April 26,
1919 was null and void; that assuming that the deed of donation was valid, only
one-half of the property was actually donated to Marcelino Doronio and Veronica
Pico; and that respondents acquired ownership of the other half portion of the
property by acquisitive prescription.[22]

CA Disposition

In a Decision dated January 26, 2005, the CA reversed the RTC decision
with the following disposition:

WHEREFORE, the assailed Decision dated June 28, 2002 is

REVERSED and SET ASIDE. Declaring the appellants as rightful
owners of one-half of the property now covered by TCT No. 44481, the
appellees are hereby directed to execute a registerable document
conveying the same to appellants.

SO ORDERED.[23]

The appellate court determined that (t)he intention to donate half of the
disputed property to appellees predecessors can be gleaned from the disparity of
technical descriptions appearing in the title (OCT No. 352) of spouses Simeon
Doronio and Cornelia Gante and in the deed of donation propter nuptias executed
on April 24, 1919 in favor of appellees predecessors.[24]

The CA based its conclusion on the disparity of the following technical

descriptions of the property under OCT No. 352 and the deed of donation, to wit:
 The court below described the property covered by OCT No. 352
as follows:

Un terreno (Lote 1018), situada en el municipio de

Asingan, Linda por el NE; con propriedad de Gabriel
Bernardino; con el SE con propriedad de Zacarias Najorda
y Alejandro Najorda; por el SO con propriedad de
Geminiano Mendoza y por el NO con el camino para
Villasis; midiendo una extension superficial mil ciento
cincuenta y dos metros cuadrados.

On the other hand, the property donated to appellees predecessors

was described in the deed of donation as:

Fourth A piece of residential land located in the barrio of

Cabalitian but we did not measure it, the area is bounded on
the north by Gabriel Bernardino; on the east by Fortunato
Doronio; on the south by Geminiano Mendoza and on the
west by a road to Villasis.Constructed on said land is a
house of light materials also a part of the dowry. Value
200.00.[25] (Emphasis ours)

Taking note that the boundaries of the lot donated to Marcelino Doronio and
Veronica Pico differ from the boundaries of the land owned by spouses Simeon
Doronio and Cornelia Gante, the CA concluded that spouses Simeon Doronio and
Cornelia Gante donated only half of the property covered by OCT No. 352.[26]

Regarding the allegation of petitioners that OCT No. 352 is inadmissible in

evidence, the CA pointed out that, while the OCT is written in the Spanish
language, this document already forms part of the records of this case for failure of
appellees to interpose a timely objection when it was offered as evidence in the
proceedings a quo. It is a well-settled rule that any objection to the admissibility of
such evidence not raised will be considered waived and said evidence will have to
form part of the records of the case as competent and admitted evidence.[27]

The CA likewise ruled that the donation of the entire property in favor of
petitioners predecessors is invalid on the ground that it impairs the legitime of
respondents predecessor, Fortunato Doronio. On this aspect, the CA reasoned out:
 Moreover, We find the donation of the entire property in favor of
appellees predecessors invalid as it impairs the legitime of appellants
predecessor.Article 961 of the Civil Code is explicit. In default of
testamentary heirs, the law vests the inheritance, x x x, in the legitimate x
x x relatives of the deceased, x x x. As Spouses Simeon Doronio and
Cornelia Gante died intestate, their property shall pass to their lawful
heirs, namely: Fortunato and Marcelino Doronio. Donating the entire
property to Marcelino Doronio and Veronica Pico and excluding another
heir, Fortunato, tantamounts to divesting the latter of his rightful share in
his parents inheritance. Besides, a persons prerogative to make donations
is subject to certain limitations, one of which is that he cannot give by
donation more than what he can give by will (Article 752, Civil Code). If
he does, so much of what is donated as exceeds what he can give by will
is deemed inofficious and the donation is reducible to the extent of such
excess.[28]

Petitioners were not pleased with the decision of the CA. Hence, this petition
under Rule 45.

Issues

Petitioners now contend that the CA erred in:

1. DECLARING ADMISSIBILITY OF THE ORIGINAL

CERTIFICATE OF TITLE NO. 352 DESPITE OF LACK OF
TRANSLATION THEREOF.

2. (RULING THAT) ONLY HALF OF THE DISPUTED

PROPERTY WAS DONATED TO THE PREDECESSORS-IN-
INTEREST OF THE HEREIN APPELLANTS.

3. (ITS) DECLARATION THAT THE DONATION PROPTER

NUPTIAS IS INNOFICIOUS, IS PREMATURE, AND THUS IT IS
ILLEGAL AND UNPROCEDURAL.[29]

Our Ruling

OCT No. 352 in Spanish Although Not

Translated into English or Filipino Is
Admissible For Lack of Timely Objection

Petitioners fault the CA for admitting OCT No. 352 in evidence on the
ground that it is written in Spanish language. They posit that (d)ocumentary
evidence in an unofficial language shall not be admitted as evidence, unless
accompanied with a translation into English or Filipino.[30]

The argument is untenable. The requirement that documents written in an

unofficial language must be accompanied with a translation in English or Filipino
as a prerequisite for its admission in evidence must be insisted upon by the parties
at the trial to enable the court, where a translation has been impugned as incorrect,
to decide the issue.[31] Where such document, not so accompanied with a
translation in English or Filipino, is offered in evidence and not objected to, either
by the parties or the court, it must be presumed that the language in which the
document is written is understood by all, and the document is admissible in
evidence.[32]

Moreover, Section 36, Rule 132 of the Revised Rules of Evidence provides:

SECTION 36. Objection. Objection to evidence offered orally

must be made immediately after the offer is made.

Objection to a question propounded in the course of the oral

examination of a witness shall be made as soon as the grounds therefor
shall become reasonably apparent.

An offer of evidence in writing shall be objected to within

three (3) days after notice of the offer unless a different period is
allowed by the court.

In any case, the grounds for the objections must be specified.

(Emphasis ours)

Since petitioners did not object to the offer of said documentary evidence on
time, it is now too late in the day for them to question its admissibility. The rule is
that evidence not objected may be deemed admitted and may be validly considered
by the court in arriving at its judgment.[33] This is true even if by its nature, the
evidence is inadmissible and would have surely been rejected if it had been
challenged at the proper time.[34]

As a matter of fact, instead of objecting, petitioners admitted the contents of

Exhibit A, that is, OCT No. 352 in their comment[35] on respondents formal offer of
documentary evidence. In the said comment, petitioners alleged, among others,
that Exhibits A, B, C, D, E, F and G, are admitted but not for the purpose they are
offered because these exhibits being public and official documents are the best
evidence of that they contain and not for what a party would like it to
prove.[36] Said evidence was admitted by the RTC.[37] Once admitted without
objection, even though not admissible under an objection, We are not inclined now
to reject it.[38] Consequently, the evidence that was not objected to became property
of the case, and all parties to the case are considered amenable to any favorable or
unfavorable effects resulting from the said evidence.[39]

Issues on Impairment of Legitime

Should Be Threshed Out in a Special
Proceeding, Not in Civil Action for
Reconveyance and Damages

On the other hand, petitioners are correct in alleging that the issue regarding
the impairment of legitime of Fortunato Doronio must be resolved in an action for
the settlement of estates of spouses Simeon Doronio and Cornelia Gante. It may
not be passed upon in an action for reconveyance and damages. A probate court, in
the exercise of its limited jurisdiction, is the best forum to ventilate and adjudge the
issue of impairment of legitime as well as other related matters involving the
settlement of estate.[40]

An action for reconveyance with damages is a civil action, whereas matters

relating to settlement of the estate of a deceased person such as advancement of
property made by the decedent, partake of the nature of a special
proceeding. Special proceedings require the application of specific rules as
provided for in the Rules of Court.[41]

As explained by the Court in Natcher v. Court of Appeals:[42]

 Section 3, Rule 1 of the 1997 Rules of Civil Procedure defines
civil action and special proceedings, in this wise:

x x x a) A civil action is one by which a party sues

another for the enforcement or protection of a right, or the
prevention or redress of a wrong.

A civil action may either be ordinary or special. Both

are governed by the rules for ordinary civil actions, subject
to specific rules prescribed for a special civil action.

xxxx

c) A special proceeding is a remedy by which a party

seeks to establish a status, a right or a particular fact.

As could be gleaned from the foregoing, there lies a marked

distinction between an action and a special proceeding. An action is a
formal demand of ones right in a court of justice in the manner
prescribed by the court or by the law. It is the method of applying legal
remedies according to definite established rules. The term special
proceeding may be defined as an application or proceeding to establish
the status or right of a party, or a particular fact. Usually, in special
proceedings, no formal pleadings are required unless the statute
expressly so provides. In special proceedings, the remedy is granted
generally upon an application or motion.

Citing American Jurisprudence, a noted authority in Remedial

Law expounds further:

It may accordingly be stated generally that actions

include those proceedings which are instituted and
prosecuted according to the ordinary rules and provisions
relating to actions at law or suits in equity, and that special
proceedings include those proceedings which are not
ordinary in this sense, but is instituted and prosecuted
according to some special mode as in the case of
proceedings commenced without summons and prosecuted
without regular pleadings, which are characteristics of
ordinary actions x x x. A special proceeding must therefore
 be in the nature of a distinct and independent proceeding
for particular relief, such as may be instituted
independently of a pending action, by petition or motion
upon notice.

Applying these principles, an action for reconveyance and

annulment of title with damages is a civil action, whereas matters
relating to settlement of the estate of a deceased person such as
advancement of property made by the decedent, partake of the nature of
a special proceeding, which concomitantly requires the application of
specific rules as provided for in the Rules of Court.

Clearly, matters which involve settlement and distribution of the

estate of the decedent fall within the exclusive province of the probate
court in the exercise of its limited jurisdiction.

Thus, under Section 2, Rule 90 of the Rules of Court, questions as

to advancement made or alleged to have been made by the deceased to
any heir may be heard and determined by the court having jurisdiction of
the estate proceedings, and the final order of the court thereon shall be
binding on the person raising the questions and on the heir.

While it may be true that the Rules used the word may, it is
nevertheless clear that the same provision contemplates a probate court
when it speaks of the court having jurisdiction of the estate proceedings.

Corollarily, the Regional Trial Court in the instant case, acting in

its general jurisdiction, is devoid of authority to render an adjudication
and resolve the issue of advancement of the real property in favor of
herein petitioner Natcher, inasmuch as Civil Case No. 71075 for
reconveyance and annulment of title with damages is not, to our mind,
the proper vehicle to thresh out said question. Moreover, under the
present circumstances, the RTC of Manila, Branch 55, was not properly
constituted as a probate court so as to validly pass upon the question of
advancement made by the decedent Graciano Del Rosario to his wife,
herein petitioner Natcher.

We likewise find merit in petitioners contention that before any conclusion

about the legal share due to a compulsory heir may be reached, it is necessary that
certain steps be taken first.[43] The net estate of the decedent must be ascertained,
by deducting all payable obligations and charges from the value of the property
owned by the deceased at the time of his death; then, all donations subject to
collation would be added to it. With the partible estate thus determined, the
legitime of the compulsory heir or heirs can be established; and only then can it be
ascertained whether or not a donation had prejudiced the legitimes.[44]

Declaration of Validity of Donation

Can Be Challenged by an Interested
Party Not Impleaded in Petition for
Quieting of Title or Declaratory Relief
or Where There is No Res Judicata.
Moreover, This Court Can Consider
a Factual Matter or Unassigned Error
in the Interest of Substantial Justice.

Nevertheless, petitioners cannot preclude the determination of validity of the deed

of donation on the ground that (1) it has been impliedly admitted by respondents;
(2) it has already been determined with finality by the RTC in Petition Case No. U-
920; or (3) the only issue in an action for reconveyance is who has a better right
over the land.[45]

The validity of the private deed of donation propter nuptias in favor of

petitioners predecessors was one of the issues in this case before the lower
courts. The pre-trial order[46] of the RTC stated that one of the issues before it is
(w)hether or not the transfer of the whole property covered by OCT No. 352 on the
basis of the private deed of donation notwithstanding the discrepancy in the
description is valid.Before the CA, one of the errors assigned by respondents is that
THE TRIAL COURT ERRED IN NOT FINDING THAT THE PRIVATE DEED
OF DONATION DATED APRIL 26, 1919 WAS NULL AND VOID.[47]

The issue of the validity of donation is likewise brought to Us by petitioners

as they stated in their Memorandum[48] that one of the issues to be resolved is
regarding the alleged fact that THE HONORABLE COURT OF APPEALS
ERRED IN FINDING THE DONATION INVALID. We are thus poised to inspect
the deed of donation and to determine its validity.
We cannot agree with petitioners contention that respondents may no longer
question the validity of the deed of donation on the ground that they already
impliedly admitted it. Under the provisions of the Civil Code, a void contract is
inexistent from the beginning. The right to set up the defense of its illegality cannot
be waived.[49] The right to set up the nullity of a void or non-existent contract is not
limited to the parties as in the case of annullable or voidable contracts; it is
extended to third persons who are directly affected by the contract.[50]

Consequently, although respondents are not parties in the deed of donation,

they can set up its nullity because they are directly affected by the same. [51] The
subject of the deed being the land they are occupying, its enforcement will
definitely affect them.

Petitioners cannot also use the finality of the RTC decision in Petition Case
No. U-920[52] as a shield against the verification of the validity of the deed of
donation. According to petitioners, the said final decision is one for quieting of
title.[53] In other words, it is a case for declaratory relief under Rule 64 (now Rule
63) of the Rules of Court, which provides:

SECTION 1. Who may file petition. Any person interested under

a deed, will, contract or other written instrument, or whose rights are
affected by a statute, executive order or regulation, or ordinance, may,
before breach or violation thereof, bring an action to determine any
question of construction or validity arising under the instrument or
statute and for a declaration of his rights or duties thereunder.

An action for the reformation of an instrument, to quiet title to

real property or remove clouds therefrom, or to consolidate
ownership under Article 1607 of the Civil Code, may be brought under
this rule.

SECTION 2. Parties. All persons shall be made parties who

have or claim any interest which would be affected by the
declaration; and no declaration shall, except as otherwise provided
 in these rules, prejudice the rights of persons not parties to the
action. (Emphasis ours)

However, respondents were not made parties in the said Petition Case No.
U-920. Worse, instead of issuing summons to interested parties, the RTC merely
allowed the posting of notices on the bulletin boards of Barangay Cabalitaan,
Municipalities of Asingan and Lingayen, Pangasinan. As pointed out by the CA,
citing the ruling of the RTC:

x x x In the said case or Petition No. U-920, notices were posted on the
bulletin boards of barangay Cabalitaan, Municipalities of Asingan and
Lingayen, Pangasinan, so that there was a notice to the whole world and
during the initial hearing and/or hearings, no one interposed objection
thereto.[54]

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.[55] The judgment in such
proceedings is conclusive only between the parties.[56] Thus, respondents are not
bound by the decision in Petition Case No. U-920 as they were not made parties in
the said case.

The rules on quieting of title[57] expressly provide that any declaration in a

suit to quiet title shall not prejudice persons who are not parties to the action.

That respondents filed a subsequent pleading[58] in the same Petition Case

No. U-920 after the decision there had become final did not change the fact that
said decision became final without their being impleaded in the case. Said
subsequent pleading was dismissed on the ground of finality of the decision.[59]

Thus, the RTC totally failed to give respondents their day in court. As a
result, they cannot be bound by its orders. Generally accepted is the principle that
no man shall be affected by any proceeding to which he is a stranger, and strangers
to a case are not bound by judgment rendered by the court.[60]
 Moreover, for the principle of res judicata to apply, the following must be
present: (1) a decision on the merits; (2) by a court of competent jurisdiction; (3)
the decision is final; and (4) the two actions involve identical parties, subject
matter and causes of action.[61] The fourth element is not present in this case. The
parties are not identical because respondents were not impleaded in Petition Case
No. U-920. While the subject matter may be the same property covered by OCT
No. 352, the causes of action are different. Petition Case No. U-920 is an action for
declaratory relief while the case below is for recovery of property.

We are not persuaded by petitioners posture that the only issue in this action
for reconveyance is who has a better right over the land; and that the validity of the
deed of donation is beside the point.[62] It is precisely the validity and
enforceability of the deed of donation that is the determining factor in resolving the
issue of who has a better right over the property. Moreover, notwithstanding
procedural lapses as to the appropriateness of the remedies prayed for in the
petition filed before Us, this Court can brush aside the technicalities in the interest
of justice. In some instances, this Court even suspended its own rules and excepted
a case from their operation whenever the higher interests of justice so
demanded.[63]

Moreover, although respondents did not directly raise the issue of validity of
the deed of donation at the commencement of the case before the trial court, it was
stipulated[64] by the parties during the pre-trial conference. In any event, this Court
has authority to inquire into any question necessary in arriving at a just decision of
a case before it.[65] Though not specifically questioned by the parties, additional
issues may also be included, if deemed important for substantial justice to be
rendered.[66]

Furthermore, this Court has held that although a factual issue is not squarely
raised below, still in the interest of substantial justice, this Court is not prevented
from considering a pivotal factual matter. The Supreme Court is clothed with
ample authority to review palpable errors not assigned as such if it finds that their
consideration is necessary in arriving at a just decision.[67]
 A rudimentary doctrine on appealed cases is that this Court is clothed with
ample authority to review matters, even if they are not assigned as errors on
appeal, if it finds that their consideration is necessary at arriving at a just decision
of the case.[68] Also, an unassigned error closely related to an error properly
assigned or upon which the determination of the question raised by the error
properly assigned is dependent, will be considered by the appellate court
notwithstanding the failure to assign it as an error.[69]

Donation Propter Nuptias of Real

Property Made in a Private Instrument
Before the New Civil Code Took Effect
on August 30, 1950 is Void

We now focus on the crux of the petition, which is the validity of the deed of
donation. It is settled that only laws existing at the time of the execution of a
contract are applicable to it and not the later statutes, unless the latter are
specifically intended to have retroactive effect.[70] Accordingly, the Old Civil Code
applies in this case as the donation propter nuptias was executed in 1919, while the
New Civil Code took effect only on August 30, 1950.

Under the Old Civil Code, donations propter nuptias must be made in a
public instrument in which the property donated must be specifically
described.[71] Article 1328 of the Old Civil Code provides that gifts propter
nuptias are governed by the rules established in Title 2 of Book 3 of the same
Code. Article 633 of that title provides that the gift of real property, in order to be
valid, must appear in a public document.[72] It is settled that a donation of real
estate propter nuptias is void unless made by public instrument.[73]

In the instant case, the donation propter nuptias did not become valid. Neither did
it create any right because it was not made in a public instrument. [74] Hence, it
conveyed no title to the land in question to petitioners predecessors.

Logically, then, the cancellation of OCT No. 352 and the issuance of a
new TCT No. 44481 in favor of petitioners predecessors have no legal basis. The
title to the subject property should, therefore, be restored to its original owners
under OCT No. 352.
Direct reconveyance to any of the parties is not possible as it has not yet been
determined in a proper proceeding who among the heirs of spouses Simeon
Doronio and Cornelia Gante is entitled to it. It is still unproven whether or not the
parties are the only ones entitled to the properties of spouses Simeon Doronio and
Cornelia Gante. As earlier intimated, there are still things to be done before the
legal share of all the heirs can be properly adjudicated.[75]

Titled Property Cannot Be Acquired

By Another By Adverse Possession
or Extinctive Prescription

Likewise, the claim of respondents that they became owners of the property
by acquisitive prescription has no merit. Truth to tell, respondents cannot
successfully invoke the argument of extinctive prescription. They cannot be
deemed the owners by acquisitive prescription of the portion of the property they
have been possessing. The reason is that the property was covered by OCT No.
352. A title once registered under the torrens system cannot be defeated even by
adverse, open and notorious possession; neither can it be defeated by
prescription.[76] It is notice to the whole world and as such all persons are bound by
it and no one can plead ignorance of the registration.[77]

The torrens system is intended to guarantee the integrity and conclusiveness

of the certificate of registration, but it cannot be used for the perpetration of fraud
against the real owner of the registered land.[78] The system merely confirms
ownership and does not create it. Certainly, it cannot be used to divest the lawful
owner of his title for the purpose of transferring it to another who has not acquired
it by any of the modes allowed or recognized by law. It cannot be used to protect a
usurper from the true owner, nor can it be used as a shield for the commission of
fraud; neither does it permit one to enrich himself at the expense of
another.[79] Where such an illegal transfer is made, as in the case at bar, the law
presumes that no registration has been made and so retains title in the real owner of
the land.[80]

Although We confirm here the invalidity of the deed of donation and of its
resulting TCT No. 44481, the controversy between the parties is yet to be fully
settled. The issues as to who truly are the present owners of the property and what
is the extent of their ownership remain unresolved. The same may be properly
threshed out in the settlement of the estates of the registered owners of the
property, namely: spouses Simeon Doronio and Cornelia Gante.

WHEREFORE, the appealed Decision is REVERSED AND SET

ASIDE. A new one is entered:

(1) Declaring the private deed of donation propter nuptias in favor of

petitioners predecessors NULL AND VOID; and
(2) Ordering the Register of Deeds of Pangasinan to:

(a) CANCEL Transfer Certificate of Title No. 44481 in the

names of Marcelino Doronio and Veronica Pico; and

(b) RESTORE Original Certificate of Title No. 352 in the

names of its original owners, spouses Simeon Doronio and Cornelia
Gante.

SO ORDERED.

DORONIO v. HEIRS OF FORTUNATO DORONIO, GR No. 169454, 2007-12-27

Facts:
Spouses Simeon Doronio and Cornelia Gante
Spouses Simeon Doronio and Cornelia Gante, now both deceased, were the registered
owners of a parcel of land... both deceased,... covered by Original Certificate of Title (OCT)
No. 352.
were the registered owners of a parcel of land located at Barangay Cabalitaan, Asingan,
Pangasinan covered by Original Certificate of Title (OCT) No. 352
The spouses had children but the records fail to disclose their number.
It is clear, however, that Marcelino Doronio and Fortunato Doronio, now both deceased,
were among them and that the parties in this case are their heirs.
Marcelino Doronio and Fortunato Doronio, now both deceased, were among them and that
the parties in this case are their heirs.
Petitioners are the heirs of Marcelino
Doronio, while respondents are the heirs of Fortunato Doronio.
On April 24, 1919, a private deed of donation propter nuptias... was executed by spouses
Simeon Doronio and Cornelia Gante in favor of Marcelino Doronio and the latter's wife,
Veronica Pico
On April 24, 1919, a private deed of donation propter nuptias[5] was executed by spouses
Simeon Doronio and Cornelia Gante in favor of Marcelino Doronio and the latter's wife,
Veronica Pico... on the east by Fortunato Doronio;
It appears that the property described in the deed of donation is the one covered by OCT
No. 352. However, there is a significant discrepancy with respect to the identity of the
owner of adjacent property at the eastern side. Based on OCT No. 352, the adjacent
owners... are Zacarias Najorda and Alejandro Najorda, whereas based on the deed of
donation, the owner of the adjacent property is Fortunato Doronio. Furthermore, said deed
of donation remained a private document as it was never notarized.
It appears that the property described in the deed of donation is the one covered by OCT
No. 352. However, there is a significant discrepancy with respect to the identity of the
owner of adjacent property at the eastern side. Based on OCT No. 352, the adjacent
owners... are Zacarias Najorda and Alejandro Najorda, whereas based on the deed of
donation, the owner of the adjacent property is Fortunato Doronio.
deed of donation remained a private document as it was never notarized.
Both parties have been occupying the subject land for several decades... although they
have different theories regarding its present ownership
According to petitioners, they are now the owners of the entire property in view of the
private deed of... donation propter nuptias in favor of their predecessors, Marcelino Doronio
and Veronica Pico.
Both parties have been occupying the subject land for several decades[8] although they
have different theories regarding its present ownership. According to petitioners, they are
now the owners of the entire property in view of the private deed of... donation propter
nuptias in favor of their predecessors, Marcelino Doronio and Veronica Pico.
Respondents, on the other hand, claim that only half of the property was actually
incorporated in the said deed of donation because it stated that Fortunato Doronio, instead
of Zacarias Najorda and Alejandro Najorda, is the owner of the adjacent property at the
eastern... side.
Eager to obtain the entire property, the heirs of Marcelino Doronio and Veronica Pico filed...
a petition "For the Registration of a Private Deed of Donation"
During the hearings, no one interposed an objection to the petition.
he petition was eventually granted on September 22, 1993.
in the names of Marcelino Doronio and Veronica Pico.
Issues:
(3) whether or not the transfer of the whole property covered by OCT No. 352 on the basis
of the... registration of the private deed of donation notwithstanding the discrepancy in the
description is valid;
(1) whether or not there was a variation in the description of the property... subject of the
private deed of donation and OCT No. 352; (2) whether or not respondents had acquired
one-half of the property covered by OCT No. 352 by acquisitive prescription; (3) whether or
not the transfer of the whole property covered by OCT No. 352 on the basis of the...
registration of the private deed of donation notwithstanding the discrepancy in the
description is valid; (4) whether or not respondents are entitled to damages; and (5) whether
or not TCT No. 44481 is valid.
DECLARATION THAT THE DONATION PROPTER NUPTIAS IS INNOFICIOUS, IS
PREMATURE, AND THUS IT IS ILLEGAL AND UNPROCEDURAL
Declaration of Validity of Donation
Can Be Challenged by an Interested
Party Not Impleaded in Petition for
Quieting of Title or Declaratory Relief... or Where There is No Res Judicata.
Moreover, This Court Can Consider... a Factual Matter or Unassigned Error in the Interest
of Substantial Justice.
Titled Property Cannot Be Acquired
By Another By Adverse Possession... or Extinctive Prescription
Ruling:
An action for the reformation of an instrument, to quiet title to real property or remove clouds
therefrom, or to consolidate ownership under Article 1607 of the Civil Code, may be brought
under this rule.
SECTION 2. Parties. All persons shall be made parties who have or claim any interest
which would be affected by the declaration; and no declaration shall, except as otherwise
provided in these rules, prejudice the rights of persons not parties to the action.
respondents were not made parties in the said Petition Case No. U-920. Worse, instead of
issuing summons to interested parties, the RTC merely allowed the posting of notices on
the bulletin boards of Barangay Cabalitaan, Municipalities of Asingan and
Lingayen, Pangasinan.
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.
principle of res judicata to apply, the following must be present: (1) a decision on the merits;
(2) by a court of competent jurisdiction; (3) the decision is final; and (4) the two actions
involve identical parties, subject matter and causes of... action.[61] The fourth element is
not present in this case. The parties are not identical because respondents were not
impleaded in Petition Case No. U-920.
A title once registered under the torrens system cannot be defeated even by adverse, open
and notorious possession; neither can it be... defeated by prescription.[76] It is notice to the
whole world and as such all persons are bound by it and no one can plead ignorance of the
registration.
The torrens system is intended to guarantee the integrity and conclusiveness of the
certificate of registration, but it cannot be used for the perpetration of fraud against the real
owner of the registered land.[78] The system merely confirms... ownership and does not
create it.
DINAH C. CASTILLO, G.R. No. 171056
Petitioner,

Present:

YNARES-SANTIAGO, J.
Chairperson,
- versus- MARTINEZ,

CHICO-NAZARIO,

NACHURA, and

PERALTA, JJ.

ANTONIO M. ESCUTIN, AQUILINA

A. MISTAS, MARIETTA L. LINATOC,
AND THE HONORABLE COURT OF
APPEALS,

Respondents. Promulgated:

March 13, 2009

x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x

DECISION

CHICO-NAZARIO, J.:
 Before this Court is a Petition for Review on Certiorari [1] under Rule 45 of
the Rules of Court filed by petitioner Dinah C. Castillo seeking the reversal and
setting aside of the Decision,[2] dated 18 October 2005, of the Court of Appeals in
CA-G.R. SP No. 90533, as well as the Resolution,[3] dated 11 January 2006 of the
same court denying reconsideration of its afore-mentioned Decision. The Court of
Appeals, in its assailed Decision, affirmed the Joint Resolution[4] dated 28 April
2004 and Joint Order[5] dated 20 June 2005 of the Office of the Deputy
Ombudsman for Luzon in OMB-L-A-03-0573-F and OMB-L-C-03-0728-F, dismissing
petitioner Dinah C. Castillos complaint for grave misconduct and violation of
Section 3(e) of Republic Act No. 3019, the Anti-Graft and Corrupt Practices Act, as
amended, against respondent public officers Antonio M. Escutin (Escutin),
Aquilina A. Mistas (Mistas) and Marietta L. Linatoc (Linatoc), together with private
individuals Lauro S. Leviste II (Leviste) and Benedicto L. Orense (Orense).

Petitioner is a judgment creditor of a certain Raquel K. Moratilla (Raquel),

married to Roel Buenaventura. In the course of her search for properties to satisfy
the judgment in her favor, petitioner discovered that Raquel, her mother Urbana
Kalaw (Urbana), and sister Perla K. Moratilla (Perla), co-owned Lot 13713, a parcel
of land consisting of 15,000 square meters, situated at Brgy.
Bugtongnapulo, Lipa City, Batangas, and covered by Tax Declaration No. 00449.

Petitioner set about verifying the ownership of Lot 13713. She was able to
secure an Order[6] dated 4 March 1999 issued by Secretary Horacio R. Morales, Jr.
of the Department of Agrarian Reform (DAR) approving the application of Summit
Point Golf & Country Club, Inc. for conversion of several agricultural landholdings,
including Lot 13713 owned by Perla K. Mortilla, et al. and covered by Tax
Declaration No. 00449, to residential, commercial, and recreational uses. She was
also able to get from the Office of the City Assessor, Lipa City, a
Certification[7] stating that Lot 13713, covered by Tax Declaration No. 00554-A,
was in the name of co-owners Raquel, Urbana, and Perla; and a certified true
copy of Tax Declaration No. 00554-A itself.[8] Lastly, the Register of Deeds of Lipa
City issued a Certification[9]attesting that Lot 13713 in the name of co-owners
Raquel, Urbana, and Perla, was not covered by a certificate of title, whether
judicial or patent, or subject to the issuance of a Certificate of Land Ownership
Award or patent under the Comprehensive Agrarian Reform Program.

Only thereafter did petitioner proceed to levy on execution Lot 13713, and
the public auction sale of the same was scheduled on 14 May 2002. Sometime in
May 2002, before the scheduled public auction sale, petitioner learned
that Lot 13713 was inside the Summit Point Golf and Country Club Subdivision
owned by Summit Point Realty and Development Corporation (Summit
Realty). She immediately went to the Makati City office of Summit Realty to meet
with its Vice President, Orense. However, she claimed that Orense did not show
her any document to prove ownership of Lot 13713 by Summit Realty, and even
threatened her that the owners of Summit Realty, the Leviste family, was too
powerful and influential for petitioner to tangle with.

The public auction sale pushed through on 14 May 2002, and petitioner
bought Raquels 1/3 pro-indiviso share in Lot 13713.

On 4 June 2002, petitioner had the following documents, on her acquisition

of Raquels 1/3 pro-indiviso share in Lot 13713, recorded in the Primary Entry Book
and Registration Book of the Register of Deeds of Lipa City in accordance with Act
No. 3344[10]: (a) Notice of Levy;[11] (b) Certificate of Sale;[12] (c) Affidavit of
Publication;[13] and (d) Writ of Execution.[14]

Subsequently, petitioner was issued by the City Assessor of Lipa City Tax
Declaration No. 00942-A,[15] indicating that she owned 5,000 square meters of Lot
13713, while Urbana and Perla owned the other 10,000 square meters.
 When petitioner attempted to pay real estate taxes for her 5,000-square-
meter share in Lot 13713, she was shocked to find out that, without giving her
notice, her Tax Declaration No. 00942-A was cancelled. Lot 13713 was said to be
encompassed in and overlapping with the 105,648 square meter parcel of land
known as Lot 1-B, covered by Transfer Certificate of Title (TCT) No. 129642[16] and
Tax Declaration No. 00949-A,[17] both in the name of Francisco Catigbac
(Catigbac). The reverse side of TCT No. 129642 bore three entries, reflecting the
supposed sale of Lot 1-B to Summit Realty, to wit:

ENTRY NO. 184894: SPECIAL POWER OF ATTORNEY: In favor of LEONARDO YAGIN: For purposes more particularly
stipulated in the contract ratified before Atty. Ernesto M. Vergara of Lipa City as per Doc. No. 639; Page No. 29; Book No.
LXXVI; Series of 1976.
Date of instrument 2-6-1976
Date of inscription 6-26-2002 at 11:20 a.m.

ENTRY NO. 185833: SALE IN FAVOR OF SUMMIT POINT REALTY & DEVELOPMENT CORP:
ENTRY NO. 185834: BIR CLEARANCE: Of the parcel of land described in this cert. of title is hereby sold and cancelled TCT
No. 134609(SN-6672938) Vol. 671-A, having been issued by virtue of the aforesaid instrument ratified before Perfecto L.
Dimayuga, Notary Public for Makati City as per Doc. No. 148; Page 31, Book No. LXVII, Series of 2002.
Date of instrument: July 22, 2002
Date of inscription: July 25, 2002 at 2:30 P.M.[18]

On 25 July 2002, at 2:30 p.m., TCT No. 129642 in the name of Catigbac was
cancelled and TCT No. T-134609 in the name of Summit Realty was issued in its
place.
The foregoing incidents prompted petitioner to file a Complaint
Affidavit[19] before the Office of the Deputy Ombudsman for Luzoncharging
several public officers and private individuals as follows:

32. I respectfully charge that on or about the months of June

2002 and July 2002 and onwards in Lipa City, Atty. Antonio M.
[Escutin], the Register of Deeds of Lipa City[;] Aquilina A. Mistas, the
Local Assessment Operations Officer III of the City Assessors Office of
Lipa City[;] Marietta Linatoc, Records Clerk, Office of the City Assessor
of Lipa City, who are public officers and acting in concert and conspiring
 with Lauro S. Leviste II and Benedicto L. Orense, Executive Vice-
President and Vice-President, respectively[,] of Summit Point Realty and
Development Corporation x x x while in the discharge of their
administrative functions did then and there unlawfully, through evident
bad faith, gross inexcusable negligence and with manifest partiality
towards Summit caused me injury in the sum of P20,000,000.00 by
cancelling my TD #00942-A in the Office of the City Assessor of Lipa City
and instead issuing in the name of Francisco Catigbac TC #00949-A
when aforesaid personalities well knew that TCT No. 129642 was
already cancelled and therefore not legally entitled to a new tax
declaration thereby manifestly favoring Summit Point Realty and
Development Corporation who now appears to be the successor-in-
interest of Francisco Catigbac, all to my damage and
prejudice.[20] (Emphasis ours.)

Petitioners Complaint Affidavit gave rise to simultaneous administrative

and preliminary (criminal) investigations, docketed as OMB-L-A-03-0573-F and
OMB-L-C-03-0728-F, respectively.
Petitioner pointed out several irregularities in the circumstances
surrounding the alleged sale of Lot 1-B to Summit Realty and in the documents
evidencing the same.

The supposed Deed of Absolute Sale in favor of Summit Realty executed on

22 July 2002 by Leonardo Yagin (Yagin), as Catigbacs attorney-in-fact, appeared to
be a one-way street. It did not express the desire of Summit Realty, as vendee, to
purchase Lot 1-B or indicate its consent and conformity to the terms of the
Deed. No representative of Summit Realty signed the left margin of each and
every page of said Deed. It also did not appear from the Deed that a
representative of Summit Realty presented himself before the Notary Public who
notarized the said document. The Tax Identification Numbers of Yagin, as vendor,
and Summit Realty, as vendee, were not stated in the Deed.
 Petitioner also averred that, being a corporation, Summit Realty could only
act through its Board of Directors. However, when the Deed of Absolute Sale of
Lot 1-B was presented for recording before the Register of Deeds, it was not
accompanied by a Secretarys Certificate attesting to the existence of a Board
Resolution which authorized said purchase by Summit Realty. There was no entry
regarding such a Secretarys Certificate and/or Board Resolution, whether on TCT
No. 129642 or TCT No. T-134609. A Secretarys Certificate eventually surfaced, but
it was executed only on 30 July 2002, five days after TCT No. T-134609 in the
name of Summit Realty was already issued.

The Deed of Absolute Sale was presented before and recorded by the
Register of Deeds of Lipa City on 25 July 2002 at 2:30 p.m., at exactly the same
date and time TCT No. T-134609 was issued to Summit Realty. Petitioner
theorizes that for this to happen, TCT No. T-134609 was already prepared and
ready even before the presentation for recording of the Deed of Absolute Sale
before the Register of Deeds.

Moreover, Catigbac had long been dead and buried. The agency Catigbac
supposedly executed in favor of Yagin was extinguished by Catigbacs death. Thus,
petitioner argued, Yagin no longer had authority to execute on 22 July 2002 the
Deed of Absolute Sale of Lot 1-B in favor of Summit Realty, making the said Deed
null and void ab initio.

Petitioner asserted that Summit Realty was well-aware of Catigbacs death,

having acknowledged the same in LRC Case No. 00-0376, the Petition for Issuance
of New Owners Duplicate of TCT No. 181 In Lieu of Lost One, filed by Summit
Realty before the Regional Trial Court (RTC) of Lipa City. During the ex
parte presentation of evidence in the latter part of 2000, Orense testified on
behalf of Summit Realty that Catigbacs property used to form part of a bigger
parcel of land, Lot 1 of Plan Psu-12014, measuring 132,975 square meters,
covered by TCT No. 181 in the name of Catigbac; after Catigbacs death, Lot 1 was
informally subdivided into several parts among his heirs and/or successors-in-
interest, some of whom again transferred their shares to other persons; Summit
Realty separately bought subdivided parts of Lot 181 from their respective
owners, with a consolidated area of 105,648 square meters, and identified as Lot
1-B after survey; despite the subdivision and transfer of ownership of Lot 1, TCT
No. 181 covering the same was never cancelled; and the owners duplicate of TCT
No. 181 was lost and the fact of such loss was annotated at the back of the
original copy of TCT No. 181 with the Registry of Deeds.Subsequently, in an
Order[21] dated 3 January 2001, the RTC granted the Petition in LRC Case No. 00-
0376 and directed the issuance of a new owners duplicate of TCT No. 181 in the
name of Catigbac, under the same terms and condition as in its original form.

Petitioner further cast doubt on the acts undertaken by Summit Realty in

connection with Catigbacs property, purportedly without legal personality and
capacity. The Special Power of Attorney dated 6 February 1976 granted Yagin the
right to sue on behalf of Catigbac, yet it was Summit Realty which instituted LRC
Case No. 00-0376, and Yagin had no participation at all in said case. Likewise, it
was not Yagin, but Orense, who, through a letter[22] dated 27 June 2001,
requested the cancellation of TCT No. 181 covering Lot 1 and the issuance of a
new certificate of title for Lot 1-B. Hence, it was Orenses request which resulted
in the issuance of TCT No. 129642 in the name of Catigbac, later cancelled and
replaced by TCT No. T-134609 in the name of Summit Realty.

Lastly, petitioner questioned why, despite the cancellation of TCT No.

129642 in the name of Catigbac and the issuance in its place of TCT No. T-134609
in the name of Summit Realty, it was the former cancelled title which was used as
basis for canceling petitioners Tax Declaration No. 00942-A. Tax Declaration No.
00949-A was thus still issued in the name of Catigbac, instead of Summit Realty.
Piecing everything together, petitioner recounted in her Complaint Affidavit
the alleged scheme perpetrated against her and the involvement therein of each
of the conspirators:
 28. Summit Point Realty and Development Corporation went into
action right after I paid Orense a visit sometime May
2002. Summitresurrected from the grave. (sic) Francisco Catigbac whom
they knew to be long dead to face possible litigation. This is the height
of malice and bad faith on the part of Summit through its Lauro Leviste
II, the Executive Vice President and Benedicto Orense, the Vice
President. I had only in my favor a tax declaration to show my interest
and ownership over the 5, 000 sq.m. of the subject parcel of
land. Evidently, Leviste and Orense came to the desperate conclusion
that they needed a TCT which is a far better title than any tax
declaration.

Both then methodically commenced their evil and illegal scheme

by causing on June 26, 2002 at 11:20 a.m. the inscription with the
Register of Deeds of Lipa City of a purported Special Power of Attorney
in favor of Leonardo Yagin (Annex I). Next, the Deed of Absolute Sale
(Annex J) was made the following month in order to make it appear that
Yagin unilaterally sold to Summit the subject parcel of land purportedly
belonging to Francisco Catigbac. Since the latter was already dead and
realizing that the agency was already extinguished, Annex J was not
signed or executed by Leviste or Orense. This fact however did not
deter the two from securing a BIR clearance on July 25, 2002. Also, on
this same day, July 25, 2002, Annex J was presented to Atty. [Escutin]
at 2:30 p.m. simultaneously, at exactly the same time of 2:30 p.m. TCT
No. T-134609 in Summits name was issued by Atty. [Escutin] WITHOUT
benefit of the submission of the necessary documentation such as the
Board Resolution, DAR Clearance, Revenue Tax Receipts for
documentary stamps, real property tax clearance, proof of payment of
transfer tax, tax declaration, articles of incorporation, SEC certification,
license to sell and/or certificate of registration by HLURB, etc. Without
the total and lightning speed cooperation of Atty. [Escutin] to close his
eyes to the total absence of said vital documents, the desperately
needed TCT to erase my interest and ownership would not have come
into existence. Atty. [Escutin] had indeed acted in concert and in
conspiracy with Leviste and Orense in producing Annex H and Annex K.

29. Thereafter, Leviste and Orense utilized the

already cancelled TCT No. 129642 in the name of Francisco Catigbac to
be the basis in seeking the cancellation of TD #00942A in my name
(Annex F). The Tax Mapping Division of the Office of City Assessor of
Lipa City opined that my 5,000 sq.m. was (sic) part and parcel of the
105,648 sq.m. covered by TCT No. 129642. A photocopy of the
Certification from said division is hereto marked and attached as Annex
P, hereof. Aquilina Mistas, the Local Assessment Operations Officer III
of the Office of the City Assessor of Lipa City then conveniently caused
the disappearance of my Notice of Levy and other supporting
documents which she had personally received from me on March 13,
2002. For her part of the conspiracy likewise, Marietta Linatoc, Records
Clerk, forthwith cancelled by TD#00942-A and in lieu thereof she issued
TD #00949-A in the name of Francisco Catigbac. I dare say so because
Mistas and Linatoc were presented a cancelled TCT as basis for
obliterating my 5,000 sq.m. The fact of cancellation is clearly stated on
the posterior side of TCT No. 129642. Both can read. But the two
nevertheless proceeded with dispatch in canceling my TD, though they
had ample time and opportunity to reject the request of Summit who is
not even the registered owner appearing on TCT No. 129642. Francisco
Catigbac could not have been in front of Mistas and Linatoc because he
was already six feet below the ground. Mistas and Linatoc could have
demanded presentation of the document authorizing Summit in
requesting for the cancellation of my TD. Also, they could have
demanded from Summit any document transferring my interest and
ownership in favor of a third party. Or, at least, they could have
annotated in Tax Declaration No. 00949-A the fact that I bought my
5,000 sq.m. from a public auction sale duly conducted by the court
sheriff. Alternatively, Linatoc and Mistas should have advised Summit to
the effect that since they already appear to be the owners of the
 subject parcel of land, the new tax declaration should bear their name
instead. Mistas and Linatoc indeed conspired with Summit in the illegal
and unwarranted cancellation of my TD and in covering up the behind-
the-scenes activities of Summit by making it appear that it was
Francisco Catigbac who caused the cancellation. Even Leonardo Yagin,
the alleged attorney-in-fact did not appear before Mistas and
Linatoc. Yagin could not have appeared because he is rumored to be
long dead. The aforementioned acts of the two benefitted
(sic) Summit through their manifest partiality, evident bad faith and/or
gross inexcusable negligence. Perhaps, there is some truth to the rumor
that Yagin is dead because he does not even have a TIN in the
questioned Deed of Absolute Sale. If indeed Yagin is already dead or
inexistent[,] the allged payment of the purchase price of P5,282,400.00
on July 25, 2002 is a mere product of the fertile imagination
of Orense and Leviste. To dispute this assertion[,] the live body of
Leonardo Yagin must be presented by Orense and Leviste.[23]

After filing her Affidavit Complaint, petitioner attempted to have the Sheriffs
Deed of Final Sale/Conveyance of her 5,000 square meter pro-indiviso share in
Lot 13713 registered with the Register of Deeds of Lipa City. She also sought
the annotation of her Affidavit of Adverse Claim on the said 5,000 square
meters on TCT No. T-134609 of Summit Realty.

Escutin, the Register of Deeds of Lipa City, relying on the finding of

Examiner Juanita H. Sta. Ana (Sta. Ana), refused to have the Sheriffs Deed of
Final Sale/Conveyance registered, since:

The Sheriffs Deed of Final Sale/Conveyance is a Mode of Transfers (sic) ownership in

favor of the Plaintiff, [Dinah] C. Castillo, (sic) However[,] it happen (sic) that the
presented Tax Declaration [No.] 00942-A is already transfer (sic) in the name of the said
 [Dinah] C. Castillo, therefore[,] the registration of Sheriff (sic) Final Sale is no longer
necessary.[24]

Escutin likewise denied petitioners request to have her Affidavit of

Adverse Claim annotated on TCT No. T-134609 on the following grounds:

1. The claimants (sic) rights or interest is not adverse to the registered

owner. The registered owner is Summit Point Realty and Development Corporation
under Transfer Certificate of Title No. T-134609 of the Registry of Deeds for Lipa City.

2. The records of the Registry reveals that the source of the rights or interest of
the adverse claimant is by virtue of a Levy on Execution by the Regional Trial Court
Fourth Judicial Region, Branch 30, San Pablo City, in Civil Case No. SP-4489 (1996),
[Dinah] C. Castillo vs. Raquel Buenaventura. The registered owner, Summit Point Realty
and Development Corporation nor its predecessor-in-interest are not the judgment
debtor or a party in the said case. Simply stated, there is no privity of contract between
them (Consulta No. 1044 and 1119). If ever, her adverse claim is against Raquel
Buenaventura, the judgment debtor who holds no title over the property.[25]

Escutin did mention, however, that petitioner may elevate en

consulta to the Land Registration Authority (LRA) the denial of her request for
registration of the Sheriffs Deed of Final Sale/Conveyance and annotation of
her adverse claim on TCT No. T-134609. This petitioner did on 3 July 2003.

While her Consulta was pending before the LRA, petitioner filed a
Supplemental Complaint Affidavit[26] and a Second Supplemental Complaint
Affidavit[27] with the Office of the Deputy Ombudsman for Luzon, bringing to its
attention the aforementioned developments. In her Second Supplemental
Complaint Affidavit, petitioner prayed that Sta. Ana be included as a co-
respondent in OMB-L-A-03-0573-F and OMB-L-C-03-0728-F, averring that the
latters actuation deprived petitioner of a factual basis for securing a new title
in her favor over her 5,000 square meter pro-indiviso share in Lot 13713,
because the public auction sale of the said property to her could never
become final without the registration of the Sheriffs Deed.

The persons charged in OMB-L-A-03-0573-F and OMB-L-C-03-0728-F

filed their respective Counter-Affidavits.

Respondent Escutin clarified in his Counter Affidavit that TCT No. T-

134609 reflected the same date and time of entry of the Deed of Absolute Sale
between Yagin (as Catigbacs attorney-in-fact) and Summit Realty, i.e., 25 July
2002 at 2:30 p.m., in accordance with Section 56[28] of Presidential Decree No.
1529, otherwise known as the Property Registration Decree. He emphasized
that his duty as Register of Deeds to register the Deed of Absolute Sale
presented before him was purely ministerial. If the document was legal and in
due form, and there was nothing mutilated or irregular on its face, the Register
of Deeds had no authority to inquire into its intrinsic validity based upon
proofs aliunde. It was not true that he allowed the registration of the Deed of
Absolute Sale notwithstanding the absence of the required documents
supporting the application for registration thereof. On the contrary, all the
required documents such as the DAR Clearance, Bureau of Internal Revenue
(BIR) Certificate Authorizing Registration (CAR), Real Property Tax, Transfer
Tax, Secretarys Certificate and Articles of Incorporation of Summit Realty were
submitted. While it was true that the Secretarys Certificate did not accompany
the Deed of Absolute Sale upon the presentation of the latter for registration,
Section 117 of the Property Registration Decree gives the party seeking
registration five days to comply with the rest of the requirements; and only if
the party should still fail to submit the same would it result in the denial of the
registration. The License to Sell and the Housing and Land Use Regulatory
Board Registration of Summit Realty are only required when a subdivision
project is presented for registration. The use of TINs in certain documents is a
BIR requirement. The BIR itself did not require from Yagin as vendor his TIN in
the Deed of Absolute Sale, and issued the CAR even in the absence
thereof. The Register of Deeds, therefore, was only bound by the CAR. As to
the Certification earlier issued by the Register of Deeds of Lipa City attesting
that Lot 13713 in the name of co-owners Raquel, Urbana, and Perla, was not
covered by any certificate of title, Escutin explained that the Register of Deeds
was not technically equipped to determine whether a cadastral lot number
was within a titled property or not. Lastly, Escutin denied conspiring or
participating in the cancellation of petitioners Tax Declaration No. 00942-A for,
as Register of Deeds, he was not concerned with the issuance (or cancellation)
of tax declarations.

Respondent Mistas, the Assistant City Assessor for Administration of the

Office of the City Assessor, Lipa City, disputed petitioners allegations that she
personally received from petitioner copies of the Notice of Levy and other
supporting documents, and that she caused the disappearance
thereof. Although she admitted that said documents were shown to her by
petitioner, she referred petitioner to the Receiving Clerk, Lynie Reyes, who
accordingly received the same. Mistas maintained that she was not the
custodian of records of the Office and she should not be held responsible for
the missing documents. She opined that petitioners documents could have
been among those misplaced or destroyed when the Office of the City
Assessor was flooded with water leaking from the toilet of the Office of the
City Mayor. As Assistant City Assessor for Administration, Mistas identified her
main function to be the control and management of all phases of
administrative matters and support. She had no hand in the cancellation of
petitioners Tax Declaration No. 00942-A, and the issuance of Catigbacs Tax
Declaration No. 00949-A for such function pertained to another division over
which she did not exercise authority. Thus, it was also not within her function
or authority to demand the presentation of certain documents to support the
cancellation of petitioners Tax Declaration No. 00942-A or to cause the
annotation of petitioners interest on Catigbacs Tax Declaration No. 00949-A.

Respondent Linatoc averred that as Local Assessment Operation Officer

II of the Office of the City Assessor, Lipa City, she was in charge of safekeeping
and updating the North District Records. With respect to the transfer of a tax
declaration from one name to another, her duty was limited only to the act of
preparing the new tax declaration and assigning it a number, in lieu of the
cancelled tax declaration. It was a purely ministerial duty. She had no authority
to demand the presentation of any document or question the validity of the
transfer. Neither was it within her jurisdiction to determine whether
petitioners interest should have been annotated on Catigbacs Tax Declaration
No. 00949-A. Examining the documents presented in support of the transfer of
the tax declaration to anothers name was a function belonging to other
divisions of the Office of the City Assessors. The flow of work, the same as in
any other ordinary transaction, mandated her to cancel petitioners Tax
Declaration No. 00942-A, and to prepare and release Catigbacs Tax Declaration
No. 00949-A after the transfer had been reviewed and approved by other
divisions of the Office. It was also not true that TCT No. 129642 in the name of
Catigbac was already cancelled when it was presented before the Office of the
City Assessors; the photocopy of said certificate of title with the Office bore no
mark of cancellation.

Leviste and Orense, the private individuals charged with the respondent
public officers, admitted that they were corporate officers of Summit
Realty. They related that Summit Realty bought a parcel of land measuring
105,648 square meters, later identified as Lot 1-B, previously included in TCT
No. 181, then specifically covered by TCT No. 129642, both in the name of
Catigbac. As a result of such purchase, ownership of Lot 1-B was transferred
from Catigbac to Summit Realty. Summit Realty had every reason to believe in
good faith that said property was indeed owned by Catigbac on the basis of
the latters certificate of title over the same. Catigbacs right as registered
owner of Lot 1-B under TCT No. 181/No. 129642, was superior to petitioners,
which was based on a mere tax declaration. Leviste and Orense rebutted
petitioners assertion that the Deed of Absolute Sale between Yagin, as
Catigbacs attorney-in-fact, and Summit Realty was a one-way street. The Deed
was actually signed on the left margin by both Yagin and the representative of
Summit Realty. The inadvertent failure of the representative of Summit Realty
to sign the last page of the Deed and of both parties to indicate their TINs
therein did not invalidate the sale, especially since the Deed was signed by
witnesses attesting to its due execution. Questions as regards the scope of
Catigbacs Special Power of Attorney in favor of Yagin and the effectivity of the
same after Catigbacs death can only be raised in an action directly attacking
the title of Summit Realty over Lot 1-B, and not in an administrative case
and/or preliminary investigation before the Ombudsman, which constituted a
collateral attack against said title. Leviste and Orense further explained that
since the owners duplicate of TCT No. 181 was lost and was judicially ordered
replaced only on 3 January 2001, entries/inscriptions were necessarily made
thereon after said date. As to Orenses failure to show petitioner any document
proving ownership of Lot 1-B by Summit Realty when the latter paid him a
visit, it was not due to the lack of such documents, but because of petitioners
failure to establish her right to peruse the same. Orense also denied ever
threatening petitioner during their meeting. Finally, according to Leviste
and Orense, petitioners allegations were based on mere conjectures and
unsupported by evidence. That particular acts were done or not done by
certain public officials was already beyond the control of Leviste and Orense,
and just because they benefited from these acts did not mean that they had a
hand in the commission or omission of said public officials.
 After more exchange of pleadings, OMB-L-A-03-0573-F and OMB-L-C-03-
0728-F were finally submitted for resolution.

In a Joint Resolution[29] dated 28 April 2004, the Office of the Deputy

Ombudsman for Luzon gave more credence to respondent Escutins defenses,
as opposed to petitioners charges against him:

Going to the charges against respondent Escutin, he convincingly explained that

he allowed the registration of the allegedly defective Deed of Sale because he, as
Register of Deeds, has no power to look into the intrinsic validity [of] the contract
presented to him for registration, owing to the ministerial character of his
function. Moreover, as sufficiently explained by said respondent, all the documents
required for the registration of the Deed of Sale were submitted by the applicant.

We likewise find said respondents explanation satisfactory that Section 56 of

P.D. 1529 mandates that the TCT bear the date of registration of the instrument on
which the said TCTs issuance was based. It is for this reason that TCT 134609 bears the
same date and time as the registration of the Deed of Absolute Sale, which deed served
as basis for its issuance.

As to his denial to register [herein petitioners] Affidavit of Adverse Claim and

Sheriffs Certificate of Final Sale, through the issuance by the Registry of Deeds Examiner
Juanita H. Sta. Ana, of the 29 June 2003 Order denying registration thereof, such matter
had been raised by herein [petitioner] in a letter-consulta to the Administrator of the
Land Registration Authority (LRA) on 03 July 2003. As the criminal and administrative
charges respecting this issue is premised, in part, on a matter still pending with the LRA,
we find it premature to make a finding on the same.

It is for the same reason that we deny the motion contained in the Second
Supplemental Complaint Affidavit praying for the inclusion, as additional respondent, of
Juanita H. Sta. Ana, who is impleaded solely on the basis of having signed, by authority
of Escutin, the 29 July 2003 Order of denial of [petitioners] application for registration.

Finally, respondent Escutin was able to successfully demonstrate, through

Consulta 2103 dated 25 July 1994, wherein the denial of registration by the Examiner of
the Registry of Deeds of Quezon City was upheld by the LRA Administrator, that the (sic)
it was practice in the different Registries that Examiners are given authority by the
Register to sign letters of denial.[30]
 The Office of the Deputy Ombudsman for Luzon declared in the same
Joint Resolution that there was no basis to hold respondents Mistas and
Linatoc administratively or criminally liable:

In this respect, this Office notes that while [herein petitioner] alleges that
Aquilina Mistas caused the disappearance of the Notice of Levy and other supporting
documents received from [petitioner] on 13 March 2003 when she applied for the
issuance of a Tax Declaration in her favor, she did not present her receiving copy thereof
showing that it was Mistas who received said documents from her. Neither did she
show that Mistas is the employee responsible for record safekeeping.

Next, we find, as convincingly answered, the allegation that respondent

Marietta Linatoc cancelled Tax Declaration No. 00942-A and issued Tax Declaration
00949-Q (sic) on the basis of a cancelled Transfer Certificate of Title upon the behest of
Summit [Realty], which was not the registered owner of the property.

Respondent Linatoc, meeting squarely [petitioners] allegation, admits having

physically cancelled Tax Declaration No. 00942-A and having prepared a new declaration
covering the same property in Catigbacs [name], as mandated by the flow of work in the
City Assessors Office. However, she denies having the authority or discretion to evaluate
the correctness and sufficiency of the documents supporting the application for the
issuance of the Tax Declaration, arguing that her official function is limited to the
physical preparation of a new tax declaration, the assignment of a new tax declaration
number and the cancellation of the old tax declaration, after the application had passed
the other divisions of the City Assessors Office.

Verily, [petitioner] failed to establish that respondent Mistas and Linatoc, are
the ones officially designated to receive applications for issuance of Tax Declaration,
evaluate the sufficiency of the documents supporting such applications, and on the basis
of the foregoing recommend or order the cancellation of an existing Tax Declaration and
direct the annotation of any fact affecting the property and direct the issuance of a new
tax declaration covering the same property.

In fact, there is even a discrepancy as to the official designation of said

respondents. While [petitioner] impleads Mistas, in her capacity as Local Assessment
Officer, and Linatoc, in her capacity as Records Clerk, Mistas, in her counter-affidavit,
alleges a different designation, i.e., Assistant City Assessor for Administration, while
Linatoc claims to be the Local Assessment Operation Officer II of the City Assessors
Office.
 With the scope of work of said respondents not having been neatly defined by
[petitioner], this Office cannot make a definitive determination of their liability for
Grave Misconduct and violation of Section 3(e) of R.A. No. 3019, which charges both
relate to the performance or discharge of Mistas and Linatocs official duties.[31]

Neither did the Office of the Deputy Ombudsman for Luzon find any
probable cause to criminally charge private individuals Leviste and Orense for
the following reasons:

Anent private respondents, with the alleged conspiracy to unlawfully cause the
transfer of the title of [herein petitioners] property to Summit sufficiently explained by
respondent Register of Deeds, such allegation against private respondents loses a legal
leg to stand on.

Inasmuch as [petitioner] was not able to sufficiently outline the official functions
of respondents Mistas and Linatoc to pin down their specific accountabilities, the
imputation that private respondent (sic) conspired with said public respondents
respecting the cancellation of Tax Declaration No. 00942-A is likewise stripped of any
factual and legal bases.[32]
As to whether petitioner was indeed unlawfully deprived of her 5,000
square meter property, which issue comprised the very premise of OMB-L-A-03-
0573-F and OMB-L-C-03-0728-F, the Office of the Deputy Ombudsman for Luzon
ruled that such matter was not within its jurisdiction and should be raised in a civil
action before the courts of justice.

In the end, the Office of the Ombudsman decreed:

WHEREFORE premises considered, it is respectfully recommended that : (1) the

administrative case against public respondents ANTONIO M. ESCUTIN, AQUILINA A.
MISTAS and MARIETA L. LINATOC be DISMISSED, for lack of substantial evidence; and (2)
the criminal case against the same respondents including private respondent LAURO S.
LEVISTE II and BENEDICTO L. ORENSE, be DISMISSED, for lack of probable cause.[33]
 In a Joint Order[34] dated 20 June 2005, the Office of the Deputy
Ombudsman for Luzon denied petitioners Motion for Reconsideration.

The Office of the Deputy Ombudsman for Luzon, in its Joint Order, took
notice of the Resolution dated 17 December 2002 of the LRA in Consulta No.
3483, which involved circumstances similar to those in petitioners case. The LRA
distinguished between two systems of land registration: one is the Torrens system
for registered lands under the Property Registration Decree, and the other is the
system of registration for unregistered land under Act No. 3344 (now Section 113
of the Property Registration Decree). These systems are separate and distinct
from each other. For documents involving registered lands, the same should be
recorded under the Property Registration Decree. The registration, therefore, of
an instrument under the wrong system produces no legal effect. Since it appeared
that in Consulta No. 3483, the registration of the Kasulatan ng Sanglaan, the
Certificate of Sale and the Affidavit of Consolidation was made under Act No.
3344, it did not produce any legal effect on the disputed property, because the
said property was already titled when the aforementioned documents were
executed and presented for registration, and their registration should have been
made under the Property Registration Decree.

Furthermore, the Office of the Deputy Ombudsman for Luzon, in the same
Joint Order, took into account petitioners withdrawal of her appeal en
consulta before the LRA of the denial by the Register of Deeds of her request for
registration of the Sheriffs Deed of Final Sale/Conveyance and Affidavit of Adverse
Claim, which prompted the LRA Administrator to declare the consulta moot and
academic. For want of a categorical declaration on the registerability of
petitioners documents from the LRA, the competent authority to rule on the said
matter, there could be no basis for a finding that respondent public officers could
be held administratively or criminally liable for the acts imputed to them.

Petitioner sought recourse from the Court of Appeals by filing a Petition

for Review under Rule 43 of the Rules of Court challenging the 28 April 2004
Joint Resolution and 20 June 2005 Joint Order of the Office of the Deputy
Ombudsman for Luzon.[35] The appeal was docketed as CA-G.R. SP No. 90533.

The Court of Appeals promulgated its Decision[36] on 18 October 2005,

also finding no reason to administratively or criminally charge
respondents. Essentially, the appellate court adjudged that petitioner can not
impute corrupt motives to respondents acts:

Without evidence showing that respondents received any gift, money or other pay-off
or that they were induced by offers of such, the Court cannot impute any taint of direct
corruption in the questioned acts of respondents. Thus, any indication of intent to
violate the laws or of flagrant disregard of established rule may be negated by
respondents honest belief that their acts were sanctioned under the provisions of
existing law and regulations. Such is the situation in the case at bar. Respondent
Register of Deeds acted in the honest belief that the agency recognized by the court in
LRC Case No. 00-0376 between the registered owner Francisco Catigbac and Leonardo
Yagin subsisted with respect to the conveyance or sale of Lot 1 to Summit as the
vendee, and that the Special Power of Attorney and Deed of Absolute Sale presented as
evidence during said proceedings are valid and binding.Hence, respondent Escutin was
justified in believing that there is no legal infirmity or defect in registering the
documents and proceeding with the transfer of title of Lot 1 in the name of the new
owner Summit. On the other hand, respondent Linatoc could not be held
administratively liable for effecting the cancellation in the course of ordinary flow of
work in the City Assessors Office after the documents have undergone the necessary
evaluation and verification by her superiors.[37]

The Court of Appeals referred to the consistent policy of the Supreme

Court not to interfere with the exercise by the Ombudsman of his investigatory
power. If the Ombudsman, using professional judgment, finds the case
dismissible, the Court shall respect such findings, unless clothed with grave
abuse of discretion. The appellate court pronounced that there was no grave
abuse of discretion on the part of the Office of the Deputy Ombudsman
for Luzon in dismissing petitioners Complaint Affidavit against respondents.
 Hence, the dispositive portion of the Decision of the Court of Appeals
reads:

WHEREFORE, premises considered, the present petition is hereby DISMISSED for

lack of merit. The challenged Joint Resolution dated April 28, 2004 and Joint Order
dated June 20, 2005 in OMB-L-A-03-0573-F and OMB-L-C-03-0728-F are hereby
AFFIRMED.[38]

In its Resolution dated 11 January 2006, the Court of Appeals denied

petitioners Motion for Reconsideration for failing to present new matter which
the appellate court had not already considered in its earlier Decision.

Petitioner now comes before this Court via the instant Petition for
Review on Certiorari, with the following assignment of errors:

I.

THE HONORABLE COURT OF APPEALS PATENTLY ERRED IN AFFIRMING THE

CANCELLATION OF THE TAX DECLARATION 00942 OF PETITIONER IN VIOLATION OF
SECTION 109 OF PRESIDENTIAL DECREE 1529, OTHERWISE KNOWN AS THE PROPERTY
REGISTRATION ACT (sic);

II.

THE HONORABLE COURT OF APPEALS PATENTLY ERRED IN RULING THAT RESPONDENTS

COULD NOT BE HELD ADMINISTRATIVELY LIABLE FOR UNDULY FAVORING SUMMIT TO
THE DAMAGE AND PREJUDICE OF PETITIONER.[39]

The Petition at bar is without merit.

As to the first issue, petitioner invokes Section 109 of the Property,

Registration Decree which provides:

SEC. 109. Notice and replacement of lost duplicate certificate. In case of loss or
theft of an owners duplicate certificate of title, due notice under oath shall be sent by
 the owner or by someone in his behalf to the Register of Deeds of the province or city
where the land lies as soon as the loss or theft is discovered. If a duplicate certificate is
lost or destroyed, or cannot be produced by a person applying for the entry of a new
certificate to him or for the registration of any new instrument, a sworn statement of
the fact of such loss or destruction may be filed by the registered owner or other person
in interest and registered.

Upon the petition of the registered owner or other person in interest, the court
may, after notice and due hearing, direct the issuance of a new duplicate certificate,
which shall contain a memorandum of the fact that it is issued in place of the lost
duplicate certificate, but shall in all respects be entitled to like faith and credit as the
original duplicate, and shall thereafter be regarded as such for all purposes of this
decree.

Petitioner argues that the RTC, in LRC Case No. 00-0376, only ordered
the issuance of a new owners duplicate of TCT No. 181 in lieu of the lost
one. However, respondents did not only issue a new owners duplicate of TCT
No. 181, but also cancelled petitioners Tax Declaration No. 00942-A and issued
in its place Tax Declaration No. 00949-A in the name of Catigbac. Respondents
did not even annotate petitioners existing right over 5,000 square meters of
Lot 1-B or notify petitioner of the cancellation of her Tax Declaration No.
00942-A.Petitioner maintains that a new owners duplicate of title is not a
mode of acquiring ownership, nor is it a mode of losing one. Under Section 109
of the Property Registration Decree, the new duplicate of title was issued only
to replace the old; it cannot cancel existing titles.

Petitioners position on this issue rests on extremely tenuous arguments

and befuddled reasoning.

Before anything else, the Court must clarify that a title is different from
a certificate of title. Title is generally defined as the lawful cause or ground of
possessing that which is ours. It is that which is the foundation of ownership of
property, real or personal.[40] Title, therefore, may be defined briefly as that
 which constitutes a just cause of exclusive possession, or which is the
foundation of ownership of property.[41] Certificate of title, on the other hand,
is a mere evidence of ownership; it is not the title to the land itself.[42] Under
the Torrenssystem, a certificate of title may be an Original Certificate of Title,
which constitutes a true copy of the decree of registration; or a Transfer
Certificate of Title, issued subsequent to the original registration.

Summit Realty acquired its title to Lot 1-B, not from the issuance of the
new owners duplicate of TCT No. 181, but from its purchase of the same from
Yagin, the attorney-in-fact of Catigbac, the registered owner of the said
property. Summit Realty merely sought the issuance of a new owners
duplicate of TCT No. 181 in the name of Catigbac so that it could accordingly
register thereon the sale in its favor of a substantial portion of Lot 1 covered
by said certificate, later identified as Lot 1-B. Catigbacs title to Lot 1-B passed
on by sale to Summit Realty, giving the latter the right to seek the separation
of the said portion from the rest of Lot 1 and the issuance of a certificate of
title specifically covering the same. This resulted in the issuance of TCT No.
129642 in the name of Catigbac, covering Lot 1-B, which was subsequently
cancelled and replaced by TCT No. T-134609 in the name of Summit Realty.

Petitioners reliance on Section 109 of the Property Registration Decree

is totally misplaced. It provides for the requirements for the issuance of a lost
duplicate certificate of title. It cannot, in any way, be related to the
cancellation of petitioners tax declaration.

The cancellation of petitioners Tax Declaration No. 00942-A was not

because of the issuance of a new owners duplicate of TCT No. 181, but of the fact
that Lot 1-B, which encompassed the 5,000 square meters petitioner lays claim to,
was already covered by TCT No. 181 (and subsequently by TCT No. 129642) in the
name of Catigbac. A certificate of title issued is an absolute and indefeasible
evidence of ownership of the property in favor of the person whose name
appears therein. It is binding and conclusive upon the whole world.[43] All persons
must take notice, and no one can plead ignorance of the
registration.[44] Therefore, upon presentation of TCT No. 129642, the Office of the
City Assessor must recognize the ownership of Lot 1-B by Catigbac and issue in his
name a tax declaration for the said property. And since Lot 1-B is already covered
by a tax declaration in the name of Catigbac, accordingly, any other tax
declaration for the same property or portion thereof in the name of another
person, not supported by any certificate of title, such that of petitioner, must be
cancelled; otherwise, the City Assessor would be twice collecting a realty tax from
different persons on one and the same property.

As between Catigbacs title, covered by a certificate of title, and

petitioners title, evidenced only by a tax declaration, the former is evidently
far superior and is, in the absence of any other certificate of title to the same
property, conclusive and indefeasible as to Catigbacs ownership of Lot 1-
B. Catigbacs certificate of title is binding upon the whole world, including
respondent public officers and even petitioner herself. Time and again, the
Court has ruled that tax declarations and corresponding tax receipts cannot be
used to prove title to or ownership of a real property inasmuch as they are not
conclusive evidence of the same.[45] Petitioner acquired her title to the 5,000
square meter property from Raquel, her judgment debtor who, it is important
to note, likewise only had a tax declaration to evidence her title. In addition,
the Court of Appeals aptly observed that, [c]uriously, as to how and when
petitioners alleged predecessor-in-interest, Raquel K. Moratilla and her
supposed co-owners acquired portions of Lot 1 described as Lot 13713 stated
in TD No. 00449, petitioner had so far remained utterly silent.[46]

Petitioners allegations of defects or irregularities in the sale of Lot 1-B to

Summit Realty by Yagin, as Catigbacs attorney-in-fact, are beyond the
jurisdiction of the Office of the Deputy Ombudsman for Luzon to consider. It
must be remembered that Summit Realty had already acquired a certificate of
title, TCT No. T-134609, in its name over Lot 1-B, which constitutes conclusive
and indefeasible evidence of its ownership of the said property and, thus,
cannot be collaterally attacked in the administrative and preliminary
investigations conducted by the Office of the Ombudsman for Luzon. Section
48 of the Property Registration Decree categorically provides that a certificate
of title shall not be subject to collateral attack. It cannot be altered, modified,
or cancelled except in a direct proceeding in accordance with law. For this
same reason, the Court has no jurisdiction to grant petitioners prayer in the
instant Petition for the cancellation of TCT No. T-134609 in the name of
Summit Realty.

Which now brings the Court to the second issue raised by petitioner on
the administrative liability of respondents.

Before the Court proceeds to tackle this issue, it establishes that

petitioners Complaint Affidavit before the Office of the Ombudsman for Luzon
gave rise to two charges: (1) OMB-L-A-03-0573-F involved the administrative
charge for Gross Misconduct against respondent public officers; and (2) OMB-
L-C-03-0728-F concerned the criminal charge for violation of Section 3(e) of
the Anti-Graft and Corrupt Practices Act[47] against respondent public officers
and private individuals Leviste and Orense. The Office of the Deputy
Ombudsman for Luzon, affirmed by the Court of Appeals, dismissed both
charges. In the Petition at bar, petitioner only assails the dismissal of the
administrative charge for grave misconduct against respondent public
officers. Since petitioner did not raise as an issue herein the dismissal by the
Office of the Deputy Ombudsman for Luzon, affirmed by the Court of Appeals,
of the criminal charge against respondent public officers for violation of
Section 3(e) of the Anti-Graft and Corrupt Practices Act, the same became final
and executory.[48]
 In Domingo v. Quimson,[49] the Court adopted the well-written report
and recommendation of its Clerk of Court on the administrative matter then
pending and involving the charge of gross or serious misconduct:

"Under Section 36, par. (b) [1] of PD No. 807, otherwise known as the Civil
Service Decree of the Philippines, 'misconduct' is a ground for disciplinary action. And
under MC No. 8, S. 1970, issued by the Civil Service Commission on July 28, 1970, which
sets the 'Guidelines in the Application of Penalties in Administrative Cases and other
Matters Relative Thereto,' the administrative offense of 'grave misconduct' carries with
it the maximum penalty of dismissal from the service (Sec. IV-C[3], MC No. 8, S. 1970).
But the term 'misconduct' as an administrative offense has a well defined meaning. It
was defined in Amosco vs. Judge Magno, Adm. Mat. No. 439-MJ, Res. September 30,
1976, as referring 'to a transgression of some established and definite rule of action,
more particularly, unlawful behavior or gross negligence by the public officer.' It is a
misconduct 'such as affects the performance of his duties as an officer and not such only
as effects his character as a private individual.' In the recent case of Oao vs. Pabato, etc.,
Adm. Mat. No. 782-MJ, Res. July 29, 1977, the Court defined 'serious misconduct' as
follows:

Hence, even assuming that the dismissal of the case is

erroneous, this would be merely an error of judgment and not serious
misconduct. The term `serious misconduct is a transgression of some
established and definite rule of action more particularly, unlawful
behavior of gross negligence by the magistrate. It implies a wrongful
intention and not a mere error of judgment. For serious misconduct to
exist, there must be reliable evidence showing that the judicial acts
complained of were corrupt or inspired by intention to violate the law,
or were a persistent disregard of well-known legal rules. We have
previously ruled that negligence and ignorance on the part of a judge
are inexcusable if they imply a manifest injustice which cannot be
explained by a reasonable interpretation. This is not so in the case at
bar. (Italics supplied.)

To reiterate, for grave misconduct to exist, there must be reliable

evidence showing that the acts complained of were corrupt or inspired by an
intention to violate the law, or were a persistent disregard of well-known legal
rules. Both the Office of the Deputy Ombudsman for Luzon and the Court of
Appeals found that there was no sufficient evidence to substantiate
petitioners charge of grave misconduct against respondents. For this Court to
reverse the rulings of the Office of the Deputy Ombudsman for Luzon and the
Court of Appeals, it must necessarily review the evidence presented by the
parties and decide on a question of fact. Once it is clear that the issue invites a
review of the evidence presented, the question posed is one of fact.[50]

Factual issues are not cognizable by this Court in a Petition for Review
under Rule 45 of the Rules of Court. In order to resolve this issue, the Court
would necessarily have to look into the probative value of the evidence
presented in the proceedings below. It is not the function of the Court to
reexamine or reevaluate the evidence all over again. This Court is not a trier of
facts, its jurisdiction in these cases being limited to reviewing only errors of
law that may have been committed by the lower courts or administrative
bodies performing quasi-judicial functions. It should be emphasized that
findings made by an administrative body, which has acquired expertise, are
accorded not only respect but even finality by the Court. In administrative
proceedings, the quantum of evidence required is only substantial.[51]

Absent a clear showing of grave abuse of discretion, the Court shall not
disturb findings of fact. The Court cannot weigh once more the evidence
submitted, not only before the Ombudsman, but also before the Court of
Appeals. Under Section 27 of Republic Act No. 6770, findings of fact by the
Ombudsman are conclusive, as long as they are supported by substantial
evidence.[52] Substantial evidence is the amount of relevant evidence which a
reasonable mind might accept as adequate to justify a conclusion.[53]

The Court finds no reason to disturb the finding of the Office of the
Deputy Ombudsman for Luzon and the Court of Appeals that respondents did
not commit gross misconduct. Evident from the 28 April 2004 Joint Resolution
of the former and the 18 October 2005Decision of the latter is that they
arrived at such findings only after a meticulous consideration of the evidence
submitted by the parties.

Respondents were able to clearly describe their official functions and to

convincingly explain that they had only acted in accordance therewith in their
dealings with petitioner and/or her documents. Respondents also enjoy in
their favor the presumption of regularity in the performance of their official
duty. The burden of proving otherwise by substantial evidence falls on
petitioner, who failed to discharge the same.

From the very beginning, petitioner was unable to identify correctly the
positions held by respondents Mistas and Linatoc at the Office of the City
Assessor. How then could she even assert that a particular action was within or
without their jurisdiction to perform? While it may be true that petitioner
should have at least been notified that her Tax Declaration No. 00942-A was
being cancelled, she was not able to establish that such would be the
responsibility of respondents Mistas or Linatoc. Moreover, petitioner did not
present statutory, regulatory, or procedural basis for her insistence that
respondents should have done or not done a particular act. A perfect example
was her assertion that respondents Mistas and Linatoc should have annotated
her interest on Tax Declaration No. 00949-A in the name of Catigbac. However,
she failed to cite any law or rule which authorizes or recognizes the annotation
of an adverse interest on a tax declaration. Finally, absent any reliable
evidence, petitioners charge that respondents conspired with one another and
with corporate officers of Summit Realty is nothing more than speculation,
surmise, or conjecture. Just because the acts of respondents were consistently
favorable to Summit Realty does not mean that there was a concerted effort
to cause petitioner prejudice. Respondents actions were only consistent with
the recognition of the title of Catigbac over Lot 1-B, transferred by sale to
Summit Realty, registered under the Torrens system, and accordingly
evidenced by certificates of title.

WHEREFORE, premises considered, the instant Petition for Review is

hereby DENIED. The Decision dated 18 October 2005 and Resolution dated 11
January 2006 of the Court of Appeals in CA-G.R. SP No. 90533 are
hereby AFFIRMED in toto. Costs against the petitioner Dinah C. Castillo.

SO ORDERED.
G.R. No. L-8936 October 2, 1915

CONSUELO LEGARDA, with her husband MAURO PRIETO, plaintiffs-appellants,

vs.
N.M. SALEEBY, defendant-appellee.

Singson, Ledesma and Lim for appellants.

D.R. Williams for appellee.

JOHNSON, J.:

From the record the following facts appear:

First. That the plaintiffs and the defendant occupy, as owners, adjoining lots in the district of Ermita
in the city of Manila.

Second. That there exists and has existed a number of years a stone wall between the said lots.
Said wall is located on the lot of the plaintiffs.

Third. That the plaintiffs, on the 2d day of March, 1906, presented a petition in the Court of Land
Registration for the registration of their lot. After a consideration of said petition the court, on the 25th
day of October, 1906, decreed that the title of the plaintiffs should be registered and issued to them
the original certificate provided for under the torrens system. Said registration and certificate
included the wall.

Fourth. Later the predecessor of the defendant presented a petition in the Court of Land Registration
for the registration of the lot now occupied by him. On the 25th day of March, 1912, the court
decreed the registration of said title and issued the original certificate provided for under the torrens
system. The description of the lot given in the petition of the defendant also included said wall.

Fifth. Several months later (the 13th day of December, 1912) the plaintiffs discovered that the wall
which had been included in the certificate granted to them had also been included in the certificate
granted to the defendant .They immediately presented a petition in the Court of Land Registration for
an adjustment and correction of the error committed by including said wall in the registered title of
each of said parties. The lower court however, without notice to the defendant, denied said petition
upon the theory that, during the pendency of the petition for the registration of the defendant's land,
they failed to make any objection to the registration of said lot, including the wall, in the name of the
defendant.

Sixth. That the land occupied by t he wall is registered in the name of each of the owners of the
adjoining lots. The wall is not a joint wall.

Under these facts, who is the owner of the wall and the land occupied by it?

The decision of the lower court is based upon the theory that the action for the registration of the lot
of the defendant was a judicial proceeding and that the judgment or decree was binding upon all
parties who did not appear and oppose it. In other words, by reason of the fact that the plaintiffs had
not opposed the registration of that part of the lot on which the wall was situate they had lost it, even
though it had been theretofore registered in their name. Granting that theory to be correct one, and
granting even that the wall and the land occupied by it, in fact, belonged to the defendant and his
predecessors, then the same theory should be applied to the defendant himself. Applying that theory
to him, he had already lost whatever right he had therein, by permitting the plaintiffs to have the
same registered in their name, more than six years before. Having thus lost hid right, may he be
permitted to regain it by simply including it in a petition for registration? The plaintiffs having secured
the registration of their lot, including the wall, were they obliged to constantly be on the alert and to
watch all the proceedings in the land court to see that some one else was not having all, or a portion
of the same, registered? If that question is to be answered in the affirmative, then the whole scheme
and purpose of the torrens system of land registration must fail. The real purpose of that system is to
quiet title to land; to put a stop forever to any question of the legality of the title, except claims which
were noted at the time of registration, in the certificate, or which may arise subsequent thereto. That
being the purpose of the law, it would seem that 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. Of course, it can not be denied that the proceeding for the
registration of land under the torrens system is judicial (Escueta vs. .Director of Lands, 16 Phil. Rep.,
482). It is clothed with all the forms of an action and the result is final and binding upon all the world.
It is an action in rem. (Escueta vs. Director of Lands (supra); Grey Alba vs. De la Cruz, 17 Phil. rep.,
49 Roxas vs. Enriquez, 29 Phil. Rep., 31; Tyler vs. Judges, 175 Mass., 51 American Land
Co. vs. Zeiss, 219 U.S., 47.)

While the proceeding is judicial, it involves more in its consequences than does an ordinary action.
All the world are parties, including the government. After the registration is complete and final and
there exists no fraud, there are no innocent third parties who may claim an interest. The rights of all
the world are foreclosed by the decree of registration. The government itself assumes the burden of
giving notice to all parties. To permit persons who are parties in the registration proceeding (and
they are all the world) to again litigate the same questions, and to again cast doubt upon the validity
of the registered title, would destroy the very purpose and intent of the law. The registration, under
the torrens system, does not give the owner any better title than he had. If he does not already have
a perfect title, he can not have it registered. Fee simple titles only may be registered. The certificate
of registration accumulates in open document a precise and correct statement of the exact status of
the fee held by its owner. The certificate, in the absence of fraud, is the evidence of title and shows
exactly the real interest of its owner. The title once registered, with very few exceptions, should not
thereafter be impugned, altered, changed, modified, enlarged, or diminished, except in some direct
proceeding permitted by law. Otherwise all security in registered titles would be lost. A registered
title can not be altered, modified, enlarged, or diminished in a collateral proceeding and not even by
a direct proceeding, after the lapse of the period prescribed by law.

For the difficulty involved in the present case the Act (No. 496) providing for the registration of titles
under the torrens system affords us no remedy. There is no provision in said Act giving the parties
relief under conditions like the present. There is nothing in the Act which indicates who should be the
owner of land which has been registered in the name of two different persons.

The rule, we think, is well settled that the decree ordering the registration of a particular parcel of
land is a bar to future litigation over the same between the same parties .In view of the fact that all
the world are parties, it must follow that future litigation over the title is forever barred; there can be
no persons who are not parties to the action. This, we think, is the rule, except as to rights which are
noted in the certificate or which arise subsequently, and with certain other exceptions which need
not be dismissed at present. A title once registered can not be defeated, even by an adverse, open,
and notorious possession. Registered title under the torrens system can not be defeated by
prescription (section 46, Act No. 496). The title, once registered, is notice to the world. All persons
must take notice. No one can plead ignorance of the registration.
The question, who is the owner of land registered in the name of two different persons, has been
presented to the courts in other jurisdictions. In some jurisdictions, where the "torrens" system has
been adopted, the difficulty has been settled by express statutory provision. In others it has been
settled by the courts. Hogg, in his excellent discussion of the "Australian Torrens System," at page
823, says: "The general rule is that in the case of two certificates of title, purporting to include the
same land, the earlier in date prevails, whether the land comprised in the latter certificate be wholly,
or only in part, comprised in the earlier certificate. (Oelkers vs. Merry, 2 Q.S.C.R., 193;
Miller vs. Davy, 7 N.Z.R., 155; Lloyd vs. Myfield, 7 A.L.T. (V.) 48; Stevens vs. Williams, 12 V.L. R.,
152; Register of Titles, vs. Esperance Land Co., 1 W.A.R., 118.)" Hogg adds however that, "if it can
be very clearly ascertained by the ordinary rules of construction relating to written documents, that
the inclusion of the land in the certificate of title of prior date is a mistake, the mistake may be
rectified by holding the latter of the two certificates of title to be conclusive." (See Hogg on the
"Australian torrens System," supra, and cases cited. See also the excellent work of Niblack in his
"Analysis of the Torrens System," page 99.) Niblack, in discussing the general question, said:
"Where two certificates purport to include the same land the earlier in date prevails. ... In successive
registrations, where more than one certificate is issued in respect of a particular estate or interest in
land, the person claiming under the prior certificates is entitled to the estate or interest; and that
person is deemed to hold under the prior certificate who is the holder of, or whose claim is derived
directly or indirectly from the person who was the holder of the earliest certificate issued in respect
thereof. While the acts in this country do not expressly cover the case of the issue of two certificates
for the same land, they provide that a registered owner shall hold the title, and the effect of this
undoubtedly is that where two certificates purport to include the same registered land, the holder of
the earlier one continues to hold the title" (p. 237).

Section 38 of Act No. 496, provides that; "It (the decree of registration) shall be conclusive upon and
against all persons, including the Insular Government and all the branches thereof, whether
mentioned by name in the application, notice, or citation, or included in the general description "To
all whom it may concern." Such decree shall not be opened by reason of the absence, infancy, or
other disability of any person affected thereby, nor by any proceeding in any court for reversing
judgments or decrees; subject, however, to the right of any person deprived of land or of any estate
or interest therein by decree of registration obtained by fraud to file in the Court of Land Registration
a petition for review within one year after entry of the decree (of registration), provided no innocent
purchaser for value has acquired an interest.

It will be noted, from said section, that the "decree of registration" shall not be opened,
for any reason, in any court, except for fraud, and not even for fraud, after the lapse of one year. If
then the decree of registration can not be opened for any reason, except for fraud, in a direct
proceeding for that purpose, may such decree be opened or set aside in a collateral proceeding by
including a portion of the land in a subsequent certificate or decree of registration? We do not
believe the law contemplated that a person could be deprived of his registered title in that way.

We have in this jurisdiction a general statutory provision which governs the right of the ownership of
land when the same is registered in the ordinary registry in the name of two persons. Article 1473 of
the Civil Code provides, among other things, that when one piece of real property had been sold to
two different persons it shall belong to the person acquiring it, who first inscribes it in the registry.
This rule, of course, presupposes that each of the vendees or purchasers has acquired title to the
land. The real ownership in such a case depends upon priority of registration. While we do not now
decide that the general provisions of the Civil Code are applicable to the Land Registration Act, even
though we see no objection thereto, yet we think, in the absence of other express provisions, they
should have a persuasive influence in adopting a rule for governing the effect of a double registration
under said Act. Adopting the rule which we believe to be more in consonance with the purposes and
the real intent of the torrens system, we are of the opinion and so decree that in case land has been
registered under the Land Registration Act in the name of two different persons, the earlier in date
shall prevail.

In reaching the above conclusion, we have not overlooked the forceful argument of the appellee. He
says, among other things; "When Prieto et al. were served with notice of the application of Teus (the
predecessor of the defendant) they became defendants in a proceeding wherein he, Teus, was
seeking to foreclose their right, and that of orders, to the parcel of land described in his application.
Through their failure to appear and contest his right thereto, and the subsequent entry of a default
judgment against them, they became irrevocably bound by the decree adjudicating such land to
Teus. They had their day in court and can not set up their own omission as ground for impugning the
validity of a judgment duly entered by a court of competent jurisdiction. To decide otherwise would
be to hold that lands with torrens titles are above the law and beyond the jurisdiction of the courts".

As was said above, the primary and fundamental purpose of the torrens system is to quiet title. If the
holder of a certificate cannot rest secure in this registered title then the purpose of the law is
defeated. If those dealing with registered land cannot rely upon the certificate, then nothing has been
gained by the registration and the expense incurred thereby has been in vain. If the holder may lose
a strip of his registered land by the method adopted in the present case, he may lose it all. Suppose
within the six years which elapsed after the plaintiff had secured their title, they had mortgaged or
sold their right, what would be the position or right of the mortgagee or vendee? That mistakes are
bound to occur cannot be denied, and sometimes the damage done thereby is irreparable. It is the
duty of the courts to adjust the rights of the parties under such circumstances so as to minimize such
damages, taking into consideration al of the conditions and the diligence of the respective parties to
avoid them. In the present case, the appellee was the first negligent (granting that he was the real
owner, and if he was not the real owner he can not complain) in not opposing the registration in the
name of the appellants. He was a party-defendant in an action for the registration of the lot in
question, in the name of the appellants, in 1906. "Through his failure to appear and to oppose such
registration, and the subsequent entry of a default judgment against him, he became irrevocably
bound by the decree adjudicating such land to the appellants. He had his day in court and should not
be permitted to set up his own omissions as the ground for impugning the validity of a judgment duly
entered by a court of competent jurisdiction." Granting that he was the owner of the land upon which
the wall is located, his failure to oppose the registration of the same in the name of the appellants, in
the absence of fraud, forever closes his mouth against impugning the validity of that judgment. There
is no more reason why the doctrine invoked by the appellee should be applied to the appellants than
to him.

We have decided, in case of double registration under the Land Registration Act, that the owner of
the earliest certificate is the owner of the land. That is the rule between original parties. May this rule
be applied to successive vendees of the owners of such certificates? Suppose that one or the other
of the parties, before the error is discovered, transfers his original certificate to an "innocent
purchaser." The general rule is that the vendee of land has no greater right, title, or interest than his
vendor; that he acquires the right which his vendor had, only. Under that rule the vendee of the
earlier certificate would be the owner as against the vendee of the owner of the later certificate.

We find statutory provisions which, upon first reading, seem to cast some doubt upon the rule that
the vendee acquires the interest of the vendor only. Sections 38, 55, and 112 of Act No. 496 indicate
that the vendee may acquire rights and be protected against defenses which the vendor would not.
Said sections speak of available rights in favor of third parties which are cut off by virtue of the sale
of the land to an "innocent purchaser." That is to say, persons who had had a right or interest in land
wrongfully included in an original certificate would be unable to enforce such rights against an
"innocent purchaser," by virtue of the provisions of said sections. In the present case Teus had his
land, including the wall, registered in his name. He subsequently sold the same to the appellee. Is
the appellee an "innocent purchaser," as that phrase is used in said sections? May those who have
been deprived of their land by reason of a mistake in the original certificate in favor of Teus be
deprived of their right to the same, by virtue of the sale by him to the appellee? Suppose the
appellants had sold their lot, including the wall, to an "innocent purchaser," would such purchaser be
included in the phrase "innocent purchaser," as the same is used in said sections? Under these
examples there would be two innocent purchasers of the same land, is said sections are to be
applied .Which of the two innocent purchasers, if they are both to be regarded as innocent
purchasers, should be protected under the provisions of said sections? These questions indicate the
difficulty with which we are met in giving meaning and effect to the phrase "innocent purchaser," in
said sections.

May the purchaser of land which has been included in a "second original certificate" ever be
regarded as an "innocent purchaser," as against the rights or interest of the owner of the first original
certificate, his heirs, assigns, or vendee? The first original certificate is recorded in the public
registry. It is never issued until it is recorded. The record notice to all the world. All persons are
charged with the knowledge of what it contains. All persons dealing with the land so recorded, or any
portion of it, must be charged with notice of whatever it contains. The purchaser is charged with
notice of every fact shown by the record and is presumed to know every fact which the record
discloses .This rule is so well established that it is scarcely necessary to cite authorities in its support
(Northwestern National Bank vs. Freeman, 171 U.S., 620, 629; Delvin on Real Estate, sections 710,
710 [a]).

When a conveyance has been properly recorded such record is constructive notice of its contents
and all interests, legal and equitable, included therein. (Grandin vs. Anderson, 15 Ohio State, 286,
289; Orvis vs. Newell, 17 Conn., 97; Buchanan vs. Intentional Bank, 78 Ill., 500; Youngs vs. Wilson,
27 N.Y., 351; McCabe vs. Grey, 20 Cal., 509; Montefiore vs. Browne, 7 House of Lords Cases, 341.)

Under the rule of notice, it is presumed that the purchaser has examined every instrument of record
affecting the title. Such presumption is irrebutable. He is charged with notice of every fact shown by
the record and is presumed to know every fact which an examination of the record would have
disclosed. This presumption cannot be overcome by proof of innocence or good faith. Otherwise the
very purpose and object of the law requiring a record would be destroyed. Such presumption cannot
be defeated by proof of want of knowledge of what the record contains any more than one may be
permitted to show that he was ignorant of the provisions of the law. The rule that all persons must
take notice of the facts which the public record contains is a rule of law. The rule must be absolute.
Any variation would lead to endless confusion and useless litigation.

While there is no statutory provision in force here requiring that original deeds of conveyance of real
property be recorded, yet there is a rule requiring mortgages to be recorded. (Arts. 1875 and 606 of
the Civil Code.) The record of a mortgage is indispensable to its validity. (Art .1875.) In the face of
that statute would the courts allow a mortgage to be valid which had not been recorded, upon the
plea of ignorance of the statutory provision, when third parties were interested? May a purchaser of
land, subsequent to the recorded mortgage, plead ignorance of its existence, and by reason of such
ignorance have the land released from such lien? Could a purchaser of land, after the recorded
mortgage, be relieved from the mortgage lien by the plea that he was a bona fide purchaser? May
there be a bona fide purchaser of said land, bona fide in the sense that he had no knowledge of the
existence of the mortgage? We believe the rule that all persons must take notice of what the public
record contains in just as obligatory upon all persons as the rule that all men must know the law; that
no one can plead ignorance of the law. The fact that all men know the law is contrary to the
presumption. The conduct of men, at times, shows clearly that they do not know the law. The rule,
however, is mandatory and obligatory, notwithstanding. It would be just as logical to allow the
defense of ignorance of the existence and contents of a public record.
In view, therefore, of the foregoing rules of law, may the purchaser of land from the owner of the
second original certificate be an "innocent purchaser," when a part or all of such land had theretofore
been registered in the name of another, not the vendor? We are of the opinion that said sections 38,
55, and 112 should not be applied to such purchasers. We do not believe that the phrase "innocent
purchaser should be applied to such a purchaser. He cannot be regarded as an "innocent
purchaser" because of the facts contained in the record of the first original certificate. The rule
should not be applied to the purchaser of a parcel of land the vendor of which is not the owner of the
original certificate, or his successors. He, in nonsense, can be an "innocent purchaser" of the portion
of the land included in another earlier original certificate. The rule of notice of what the record
contains precludes the idea of innocence. By reason of the prior registry there cannot be an innocent
purchaser of land included in a prior original certificate and in a name other than that of the vendor,
or his successors. In order to minimize the difficulties we think this is the safe rule to establish. We
believe the phrase "innocent purchaser," used in said sections, should be limited only to cases
where unregistered land has been wrongfully included in a certificate under the torrens system.
When land is once brought under the torrens system, the record of the original certificate and all
subsequent transfers thereof is notice to all the world. That being the rule, could Teus even regarded
as the holder in good fifth of that part of the land included in his certificate of the appellants? We
think not. Suppose, for example, that Teus had never had his lot registered under the torrens
system. Suppose he had sold his lot to the appellee and had included in his deed of transfer the very
strip of land now in question. Could his vendee be regarded as an "innocent purchaser" of said strip?
Would his vendee be an "innocent purchaser" of said strip? Certainly not. The record of the original
certificate of the appellants precludes the possibility. Has the appellee gained any right by reason of
the registration of the strip of land in the name of his vendor? Applying the rule of notice resulting
from the record of the title of the appellants, the question must be answered in the negative. We are
of the opinion that these rules are more in harmony with the purpose of Act No. 496 than the rule
contended for by the appellee. We believe that the purchaser from the owner of the later certificate,
and his successors, should be required to resort to his vendor for damages, in case of a mistake like
the present, rather than to molest the holder of the first certificate who has been guilty of no
negligence. The holder of the first original certificate and his successors should be permitted to rest
secure in their title, against one who had acquired rights in conflict therewith and who had full and
complete knowledge of their rights. The purchaser of land included in the second original certificate,
by reason of the facts contained in the public record and the knowledge with which he is charged
and by reason of his negligence, should suffer the loss, if any, resulting from such purchase, rather
than he who has obtained the first certificate and who was innocent of any act of negligence.

The foregoing decision does not solve, nor pretend to solve, all the difficulties resulting from double
registration under the torrens system and the subsequent transfer of the land. Neither do we now
attempt to decide the effect of the former registration in the ordinary registry upon the registration
under the torrens system. We are inclined to the view, without deciding it, that the record under the
torrens system, supersede all other registries. If that view is correct then it will be sufficient, in
dealing with land registered and recorded alone. Once land is registered and recorded under the
torrens system, that record alone can be examined for the purpose of ascertaining the real status of
the title to the land.

It would be seen to a just and equitable rule, when two persons have acquired equal rights in the
same thing, to hold that the one who acquired it first and who has complied with all the requirements
of the law should be protected.

In view of our conclusions, above stated, the judgment of the lower court should be and is hereby
revoked. The record is hereby returned to the court now having and exercising the jurisdiction
heretofore exercised by the land court, with direction to make such orders and decrees in the
premises as may correct the error heretofore made in including the land in the second original
certificate issued in favor of the predecessor of the appellee, as well as in all other duplicate
certificates issued.

Without any findings as to costs, it is so ordered.

Arellano, C.J., Torrens, and Araullo, JJ., concur.

Separate Opinions

TRENT, J., dissenting:

I dissent.

In cases of double or overlapping registration, I am inclined to agree with the reasoning and authority
on which it is held in the majority opinion (first) that the original holder of the prior certificate is
entitled to the land as against the original holder of the later certificate, where there has been no
transfer of title by either party to an innocent purchaser; both, as is shown in the majority opinion,
being at fault in permitting the double registration to take place; (second) that an innocent purchaser
claiming under the prior certificate is entitled to the land as against the original holder of the later
certificate, and also as against innocent purchasers from the holder of the later certificate; the
innocent purchaser being in no wise at fault in connection with the issuance of the later certificate.

But I am of opinion that neither the authorities cited, nor the reasoning of the majority opinion
sustains the proposition that the original holder of the prior certificate is entitled to the land as
against an innocent purchaser from the holder of the later certificate.

As to the text-book authorities cited in the majority opinion, it is sufficient to say that the rules laid
down by both Hogg and Niblack are mere general rules, admittedly subject to exception, and of
course of no binding force or authority where the reasoning upon which these rules are based is
applicable to the facts developed in a particular case.

In its last analysis the general rule laid down in the majority opinion rests upon the proposition set
forth in the last page of the opinion wherein it is said that "it would seem to be a just and equitable
rule, when two persons have acquired equal rights in the same thing, to hold that the one who
acquired it first and who has complied with all the requirements of the law should be protected." The
rule, as applied to the matter in hand, may be stated as follows: It would seem to be a just and
equitable rule when two persons have acquired separate and independent registered titles to the
same land, under the Land Registration Act, to hold that the one who first acquired registered title
and who has complied with all the requirements of the law in that regard should be protected, in the
absence of any express statutory provision to the contrary.

Thus stated I have no quarrel with the doctrine as a statement of the general rule to be applied in
cases of double or overlapping registration under the Land Registration Act; for it is true as stated in
the majority opinion that in the adjudication and registration of titles by the Courts of Land
Registration "mistakes are bound to occur, and sometimes the damage done thereby is irreparable;"
and that in the absence of statutory provisions covering such cases, "it is the duty of the courts to
adjust the rights of the parties, under such circumstances, so as to minimize such damages, taking
into consideration all of the conditions, and the diligence of the respective parties to avoid them."

But like most such general rules, it has its exceptions and should not be applied in a case wherein
the reasons on which it is based do not exist, or in cases wherein still more forceful reasons demand
the application of a contrary rule.

The general rule relied upon in the majority opinion is a mere application of a well settled equity rule
that: "Where conflicting equities are otherwise equal in merit, that which first occurred will be given
the preference." But it is universally laid down by all the courts which have had occasion to apply this
equity rule that "it should be the last test resorted to," and that "it never prevails when any other
equitable ground for preference exists." (See 19 Cent. Dig., tit. Equity, par. 181; and may cases cited
in 16 Cyc., 139, note 57.) It follows that the general rules, that in cases of double or overlapping
registration the earlier certificate should be protected, ought not to prevail so as to deprive an
innocent purchaser under the later certificate of his title of the earlier certificate contributed to the
issuance of the later certificate. Hence the holder of the earlier certificate of title should not be heard
to invoke the "just and equitable rule" as laid down in the majority opinion, in order to have his own
title protected and the title of an innocent purchaser of a later certificate cancelled or annulled, in any
case wherein it appears that the holder of the later certificate was wholly without fault, while the
holder of the issuance of the later certificate, in that he might have prevented its issuance by merely
entering his appearance in court in response to lawful summons personally served upon him in the
course of the proceedings for the issuance of the second certificate, and pleading his superior rights
under the earlier certificate, instead of keeping silent and by his silence permitting a default judgment
to be entered against him adjudicating title in favor of the second applicant.

The majority opinion clearly recognizes the soundness of the principles I am contending for by
reasoning (with which I am inclined to agree) whereby it undertakes to demonstrate that as between
the original holders of the double or overlapping registration the general rule should
prevail, because both such original parties must held to have been fault and, their equities being
equal, preference should be given to the earlier title.

The majority opinion further recognizes the soundness of my contention by the reasoning whereby it
undertakes to sustain the application of the general rule in favor of the original holder of the earlier
certificate against purchasers from the original holder of the later certificate, by an attempt to
demonstrate that such purchasers can in no event be held to be innocent purchasers; because, as it
is said, negligence may and should always be imputed to such a purchaser, so that in no event can
he claim to be without fault when it appears that the lands purchased by him from the holder of a
duly registered certificate of title are included within the bounds of the lands described in a certificate
of title of an earlier date.

At considerable length the majority opinion (in reliance upon the general rule laid down under the
various systems of land registration, other than those based on the torrens system) insists that a
purchaser of land land duly registered in the Land Registration Court, is charged with notice of the
contents of each and every one of the thousands and tens of thousands of certificates of registry on
file in the land registry office, so that negligence may be imputed to him if he does not ascertain that
all or any part of the land purchased by him is included within the boundary lines of any one of the
thousands or tens of thousands of tracts of land whose original registry bears an earlier date than
the date of the original registry of the land purchased by him. It is contended that he cannot claim to
be without fault should he buy such land because, as it is said, it was possible for him to discover
that the land purchased by him had been made the subject of double or overlapping registration by a
comparison of the description and boundary lines of the thousands of tracts and parcels of land to be
found in the land registry office.

But such ruling goes far to defeat one of the principal objects sought to be attained by the
introduction and adoption of the so-called torrens system for the registration of land. The avowed
intent of that system of land registration is to relieve the purchase of registered lands from the
necessity of looking farther than the certificate of title of the vendor in order that he may rest secure
as to the validity of the title to the lands conveyed to him. And yet it is said in the majority opinion
that he is charged with notice of the contents of every other certificate of title in the office of the
registrar so that his failure to acquaint himself with its contents may be imputed to him as
negligence.

If the rule announced in the majority opinion is to prevail, the new system of land registration, instead
of making transfers of real estate simple, expenditious and secure, and instead of avoiding the
necessity for expensive and oftimes uncertain searches of the land record and registries, in order to
ascertain the true condition of the title before purchase, will, in many instances, add to the labor,
expense and uncertainty of any attempt by a purchaser to satisfy himself as to the validity of the title
to lands purchased by him.

As I have said before, one of the principal objects, if not the principal object, of the torrens system of
land registration upon which our Land Registration Act is avowedly modelled is to facilitate the
transfer of real estate. To that end the Legislature undertakes to relieve prospective purchasers and
all others dealing in registered lands from the necessity of looking farther than the certificate of title
to such lands furnished by the Court of Land Registration, and I cannot, therefore, give my consent
to a ruling which charges a purchaser or mortgage of registered lands with notice of the contents of
every other certificate of title in the land registry, so that negligence and fault may be imputed to him
should he be exposed to loss or damages as a result of the lack of such knowledge.

Suppose a prospective purchaser of lands registered under the Land Registration Act desires to
avoid the imputation of negligence in the event that, unknown to him, such lands have been made
the subject of double or overlapping registration, what course should he pursue? What measures
should he adopt in order to search out the information with notice of which he is charged? There are
no indexes to guide him nor is there anything in the record or the certificate of title of the land he
proposes to buy which necessarily or even with reasonable probability will furnish him a clue as to
the fact of the existence of such double or overlapping registration. Indeed the only course open to
him, if he desires to assure himself against the possibility of double or overlapping registration,
would even seem to be a careful, laborious and extensive comparison of the registered boundary
lines contained in the certificate of title of the tract of land he proposes to buy with those contained in
all the earlier certificates of title to be found in the land registry. Assuredly it was never the intention
of the author of the new Land Registration Act to impose such a burden on a purchaser of duly
registered real estate, under penalty that a lack of the knowledge which might thus be acquired may
be imputed to him by this court as negligence in ruling upon the respective equities of the holders of
lands which have been the subject of double or overlapping registration.

On the other hand, I think that negligence and fault may fairly be imputed to a holder of a registered
certificate of title who stood supinely by and let a default judgment be entered against him,
adjudicating all or any part of his registered lands to another applicant, if it appears that he was
served with notice or had actual notice of the pendency of the proceedings in the Court of Land
Registration wherein such default judgment was entered.
The owner of land who enjoys the benefits secured to him by its registry in the Court of Land
Registration may reasonably be required to appear and defend his title when he has actual notice
that proceedings are pending in that court wherein another applicant, claiming the land as his own, is
seeking to secure its registry in his name. All that is necessary for him to do is to enter his
appearance in those proceedings, invite the court's attention to the certificate of title registered in his
name, and thus, at the cost of the applicant, avoid all the damage and inconvenience flowing from
the double or overlapping registration of the land in question. There is nothing in the new system of
land registration which seems to render it either expedient or necessary to relieve a holder of a
registered title of the duty of appearing and defending that title, when he has actual notice that it is
being attacked in a court of competent jurisdiction, and if, as a result of his neglect or failure so to
do, his lands become subject to double or overlapping registration, he should not be permitted to
subject an innocent purchaser, holding under the later certificate, to all the loss and damage
resulting from the double or overlapping registration, while he goes scot free and holds the land
under a manifest misapplication of the equitable rule that "where conflicting equities are otherwise
equal in merit, that which first accrued will be given the preference." It is only where both or neither
of the parties are at fault that the rule is properly applicable as between opposing claimants under an
earlier and a later certificate of registry to the same land.

Of course all that is said in the briefs of counsel and the majority opinion as to the right of the holder
of a certificate to rest secure in his registered title so that those dealing with registered lands can
confidently rely upon registry certificates thereto is equally forceful by way of argument in favor of the
holder of one or the other certificate in case of double or overlapping registration. The problem is to
determine which of the certificate holders is entitled to the land. The decision of that question in favor
of either one must necessarily have the effect of destroying the value of the registered title of the
other and to that extent shaking the public confidence in the value of the whole system for the
registration of lands. But, in the language of the majority opinion, "that mistakes are bound to occur
cannot be denied and sometimes the damage done thereby is irreparable. It is the duty of the courts
to adjust the rights of the parties under such circumstances so as to minimize the damages, taking
into consideration all the conditions and the diligence of the respective parties to avoid them." lawphil.net

It will be observed that I limit the exception to the general equitable rule, as laid down in the majority
opinion, to case wherein the holder of the earlier certificate of title has actual notice of the pendency
of the proceedings in the course of which the latter certificate of title was issued, or to cases in which
he has received personal notice of the pendency of those proceedings. Unless he has actual notice
of the pendency of such proceedings I readily agree with the reasoning of the majority opinion so far
as it holds that negligence, culpable negligence, should not be imputed to him for failure to appear
and defend his title so as to defeat his right to the benefit of the equitable rule. It is true that the order
of publication in such cases having been duly complied with, all the world is charged with notice
thereof, but it does not necessarily follow that, in the absence of actual notice, culpable negligence in
permitting a default judgment to be entered against him may be imputed to the holder of the earlier
certificate so as to defeat his right to the land under the equitable rule favoring the earlier certificate.
Such a holding would have the effect (to quote the language of the majority opinion) of requiring the
holder of a certificate of title to wait indefinitely "in the portals of the court" and to sit in the "mirador
de su casa" in order to avoid the possibility of losing his lands; and I agree with the writer of the
majority opinion that to do so would place an unreasonable burden on the holders of such certificate,
which was not contemplated by the authors of the Land Registration Act. But no unreasonable
burden is placed upon the holder of a registered title by a rule which imputes culpable negligence to
him when he sits supinely by and lets a judgment in default be entered against him adjudicating title
to his lands in favor of another applicant, despite the fact that he has actual knowledge of the
pendency of the proceedings in which such judgment is entered and despite the fact that he has
been personally served with summons to appear and default his title.
"Taking into consideration all of the conditions and the diligence of the respective parties," it seems
to me that there is no "equality in merit" between the conflicting equities set up by an innocent
purchaser who acquires title to the land under a registered certificate, and the holder of an earlier
certificate who permitted a default judgment to be entered against him, despite actual notice of the
pendency of the proceedings in the course of which the later certificate was issued.

I am convinced, furthermore, that aside from the superior equities of the innocent purchaser in cases
such as that now under discussion, there are strong reasons of convenience and public policy which
militate in favor of the recognition of his title rather than that of the holder of the earlier title.

One ruling exposes all persons purchasing or dealing in registered lands to unknown, unspecified
and uncertain dangers, to guard against which all such persons will be put to additional cost,
annoyance and labor on every occasion when any transaction is had with regard to such lands;
while the other ruling tends to eliminate consequences so directly adverse to the purpose and object
for which the land registration law was enacted, and imposes no burden upon any holder of a
certificate of registered lands other than that of defending his title on those rare, definite and specific
occasions wherein he has actual notice that his title is being challenged in a Court of Land
Registration, a proceeding in which the cost and expense is reduced to the minimum by the
conclusive character of his certificate of title in support of his claim of ownership. Furthermore,
judgment against the innocent purchaser and in favor of the holder of the earlier certificate in a case
such as that under consideration must inevitably tend to increase the danger of double or
overlapping registrations by encouraging holders of registered titles, negligently or fraudulently and
conclusively, to permit default judgments to be entered against them adjudicating title to all or a part
of their registered lands in favor of other applicants, despite actual notice of the pendency of judicial
proceedings had for that purpose, and this, without adding in any appreciable degree to the security
of thir titles, and merely to save them the very slight trouble or inconvenience incident to an entry of
appearance in the court in which their own titles were secured, and inviting attention to the fact that
their right, title and ownership in the lands in questions has already been conclusively adjudicated.

The cases wherein there is a practical possibility of double or overlapping registration without actual
notice to the holder of the earlier certificate must in the very nature of things to be so rare as to be
practically negligible. Double or overlapping registration almost invariably occurs in relation to lands
held by adjoining occupants or claimants. It is difficult to conceive of a case wherein double
registration can take place, in the absence of fraud, without personal service of notice of the
pendency of the proceedings upon the holder of the earlier certificate, the statute requiring such
notice to be served upon the owner or occupant of all lands adjoining those for which application for
registration is made; and the cases wherein an adjoining land owner can, even by the use of fraud,
conduct proceedings for the registration of his land to a successful conclusion without actual notice
to the adjoining property owners must be rare indeed.

In the case at bar the defendant purchased the land in question from the original holder of a
certificate of title issued by the Court of Land Registration, relying upon the records of the Court of
Land Registration with reference thereto and with no knowledge that any part of the land thus
purchased was included in an earlier certificate of title issued to the plaintiff. The plaintiff, the holder
of the earlier certificate of title, negligently permitted a default judgment to be entered against him in
the Court of Land Registration, adjudicating part of the lands included in his own certificate of title in
favor of another applicant, from whom the defendant in this action acquired title, and this despite the
fact that he was an adjoining land owner, had actual notice of the pendency of the proceedings and
was personally served with summons to appear and defends his rights in the premises. It seems to
me that there can be no reason for doubt as to the respective merits of the equities of the parties,
and further that the judgment of the majority in favor of the plaintiff will inevitably tend to increase the
number of cases wherein registered land owners in the future will fail to appear and defend their
titles when challenged in other proceedings in the Courts of Land Registration, thereby enormously
increasing the possibility and probability of loss and damage to innocent third parties and dealers in
registered lands generally, arising out of erroneous, double or overlapping registration of lands by
the Courts of Land Registration.
ADORACION ROSALES G.R. No. 143573
RUFLOE, ALFREDO RUFLOE
and RODRIGO RUFLOE,
Petitioners,

Present:

PUNO, C.J.,*

- versus - CARPIO,** Acting Chairperson,

AUSTRIA-MARTINEZ,***

CORONA,

CARPIO MORALES,*** and

LEONARDA BURGOS, ANITA LEONARDO-DE CASTRO, JJ.

BURGOS, ANGELITO BURGOS,
AMY BURGOS, ELVIRA DELOS
REYES and JULIAN C. TUBIG,
Respondents.
Promulgated:

January 30, 2009

x------------------------------------------------------------------------------------------x

DECISION
LEONARDO-DE CASTRO, J.:

Under consideration is this petition for review under Rule 45 of the Rules of Court
seeking the reversal and setting aside of the Decision[1]dated January 17, 2000 of
the Court of Appeals (CA) in CA-G.R. CV. No. 49939, and its Resolution[2] dated
June 9, 2000, denying petitioners motion for reconsideration.

The assailed decision reversed and set aside the February 10, 1995
decision[3] of the Regional Trial Court (RTC) at Muntinlupa, Metro Manila, Branch
276,[4] in its Civil Case No. 90-359, an action for Declaration of Nullity of Contract
and Cancellation of Transfer Certificate of Titles and Damages, commenced by the
petitioners against herein respondents.

The factual antecedents are as follows:

Petitioner Adoracion Rufloe is the wife of Angel Rufloe, now deceased, while co-
petitioners Alfredo and Rodrigo are their children. During the marriage of
Adoracion and Angel, they acquired a 371-square meter parcel of land located at
Barangay Bagbagan, Muntinlupa, and covered by Transfer Certificate of Title (TCT)
No. 406851 which is the subject of the present controversy.

Sometime in 1978, respondent Elvira Delos Reyes forged the signatures of

Adoracion and Angel in a Deed of Sale dated September 8, 1978 to make it appear
that the disputed property was sold to her by the spouses Rufloe. On the basis of
the said deed of sale, Delos Reyes succeeded in obtaining a title in her name, TCT
No. S-74933.

Thus, in November 1979, the Rufloes filed a complaint for damages against
Delos Reyes with the RTC of Pasay City alleging that the Deed of Sale was falsified
as the signatures appearing thereon were forged because Angel Rufloe died in
1974, which was four (4) years before the alleged sale in favor of Delos Reyes. The
complaint was docketed as Civil Case No. M-7690.[5] They also filed a notice of
adverse claim on November 5, 1979.
On December 4, 1984, during the pendency of Civil Case No. M-7690, Delos Reyes
sold the subject property to respondent siblings Anita, Angelina, Angelito and
Amy (Burgos siblings). A new title, TCT No. 135860, was then issued in their
names.

On December 12, 1985, the Burgos siblings, in turn, sold the same property
to their aunt, Leonarda Burgos. However, the sale in favor of Leonarda was not
registered. Thus, no title was issued in her name. The subject property remained
in the name of the Burgos siblings who also continued paying the real estate taxes
thereon.

On February 6, 1989, the RTC of Pasay City, Branch 108,[6] rendered its decision in
Civil Case No. M-7690 declaring that the Deed of Sale in favor of Delos Reyes was
falsified as the signatures of the spouses Rufloe had been forged. The trial court
ruled that Delos Reyes did not acquire ownership over the subject property. Said
decision had become final and executory.

Such was the state of things when, on February 8, 1990, in the RTC of
Muntinlupa, the Rufloes filed their complaint for Declaration of Nullity of Contract
and Cancellation of Transfer Certificate of Titles against respondents Leonarda
and the Burgos siblings, and Delos Reyes. In their complaint, docketed as Civil
Case No. 90-359, the Rufloes basically alleged that inasmuch as the Deed of Sale
in favor of Delos Reyes was falsified, no valid title was ever conveyed to
the Burgos siblings.[7] The Burgos siblings executed a simulated deed of sale in
favor of Leonarda knowing fully well that their title was a nullity.

In their common Answer, respondents maintained that they bought the property
in good faith after they were shown a genuine copy of the title of the disputed
property by Delos Reyes. They also insisted that they were innocent purchasers in
good faith and for value.[8]
On February 10, 1995, the trial court rendered a decision declaring that
Leonarda and the Burgos siblings were not innocent purchasers for value and did
not have a better right to the property in question than the true and legal owners,
the Rufloes. The trial court also held that the subsequent conveyance of the
disputed property to Leonarda by the Burgos siblings was simulated to make it
appear that Leonarda was a buyer in good faith. The trial court then directed the
Register of Deeds of Makati, Rizal to reinstate the title of the spouses Rufloe, and
to cancel all other titles subsequent to the said title particularly TCT No. S-74933
issued to Delos Reyes and TCT No. 135860 issued to the Burgos siblings.[9]

Respondents interposed an appeal to the CA, whereat the appellate recourse was
docketed as CA-G.R. CV. No. 49939.

As stated at the threshold hereof, the CA, in its decision dated January 17,
2000, reversed and set aside that of the trial court, declaring in the process that
respondents were purchasers in good faith and for value. In so ruling, the CA
explained:

Measured by this yardstick, defendants-appellants [herein

respondents] are purchasers in good faith and for value. Amado Burgos
bought the subject property (for his children Anita, Angelina, Angelito
and Amy) free from any lien or encumbrance or any notice of adverse
claim annotated thereto. He was presented with a clean title already in
the name of the seller. If a person purchases a piece of land on the
assurance that the sellers title thereto is valid, he should not run the
risk of being told later that his acquisition was ineffectual after all. If we
were to void a sale of property covered by a clean and unencumbered
torrens title, public confidence in the Torrens System would be eroded
and transactions would have to be attended by complicated and
 inconclusive investigations and uncertain proof of ownership. The
consequences would be that land conflicts could proliferate and
become more abrasive, if not violent. (Words in bracket ours).[10]

Their motion for reconsideration having been denied by the CA in its

equally challenged resolution of June 9, 2000, petitioners are now with us via the
present recourse, faulting the CA as follows:

A. THE HONORABLE COURT OF APPEALS DECIDED THIS CASE IN A

WAY NOT IN ACCORD WITH THE APPLICABLE DECISIONS OF THE
HONORABLE SUPREME COURT.

B. THERE ARE SPECIAL AND IMPORTANT REASONS THAT REQUIRE A

REVIEW OF THE CA DECISION.

C. THE HONORABLE CA ACTED WITH GRAVE ABUSE OF DISCRETION

AMOUNTING TO LACK OF JURISDICTION WHEN IT
COUNTERMANDED THE FINDINGS OF THE REGIONAL TRIAL COURT
EVEN ON POINTS AND QUESTIONS OF CREDIBILITY.

D. THE CA JUDGMENT THAT REVERSED THE RTC DECISION IS NOT

SUPPORTED BY THE EVIDENCE ON RECORD AND IS CONTRARY TO
ESTABLISHED PRECEDENTS LAID DOWN BY THE HONORABLE
SUPREME COURT.

E. THE CA ERRED IN LAW IN PRACTICALLY HOLDING THAT A DEAD

MAN ANGEL RUFLOE (ANGEL NEVER SIGNED) VALIDLY DISPOSED OF
HIS PROPERTY (A HOUSE AND LOT COVERED BY A TCT THROUGH A
FALSIFIED DEED OF SALE) AFTER HIS DEATH FOUR (4) YEARS BEFORE
THE EXECUTION OF THE DEED.
 F. THE CA ERRED IN LAW IN HOLDING ANITA, ANGELINA, AMY AND
ANGELITO BURGOS AND THEIR SUCCESOR-IN-INTEREST (THEIR
AUNT) LEONARDA BURGOS ARE BUYERS IN GOOD FAITH.

G. THE CA IGNORED THE PLAIN PROVISIONS OF THE CIVIL CODE THAT

IN ALL CONTRACTUAL, PROPERTY OR OTHER RELATIONS, WHEN ONE
OF THE PARTIES IS AT A DISADVANTAGE ON ACCOUNT OF HIS
MORAL DEPENDENCE, IGNORANCE, INDIGENCE, MENTAL
WEAKNESS, TENDER AGE OR OTHER HANDICAP, THE COURT MUST
BE VIGILANT FOR HIS PROTECTION.[11]

In a gist, the issues to be resolved are (1) whether the sale of the subject
property by Delos Reyes to the Burgos siblings and the subsequent sale by the
siblings to Leonarda were valid and binding; and (2) whether respondents were
innocent purchasers in good faith and for value despite the forged deed of sale of
their transferor Delos Reyes.

The issues necessitate an inquiry into the facts. While, as a rule, factual
issues are not within the province of this Court, nonetheless, in light of the
conflicting factual findings of the two (2) courts below, an examination of the
facts obtaining in this case is in order.

The Rufloes aver that inasmuch as the Deed of Sale purportedly executed
by them in favor of Delos Reyes was a forgery, she could not pass any valid right
or title to the Burgos siblings and Leonarda. The Rufloes also contend that since
the Burgos siblings and Leonarda acquired the subject property with notice that
another person has a right to or interest in such property, they cannot be
considered innocent purchasers in good faith and for value.
 For their part, the Burgos siblings and Leonarda insist that their title is valid
and binding. They maintain that under the Torrens System, a person dealing with
registered land may safely rely on the correctness on the certificate of title
without the need of further inquiry. For this reason, the Court cannot disregard
the right of an innocent third person who relies on the correctness of the
certificate of title even if the sale is void.

We find merit in the petition.

The issue concerning the validity of the deed of sale between the Rufloes
and Delos Reyes had already been resolved with finality in Civil Case No. M-7690
by the RTC of Pasay City which declared that the signatures of the alleged
vendors, Angel and Adoracion Rufloe, had been forged.[12] It is undisputed that
the forged deed of sale was null and void and conveyed no title. It is a well-settled
principle that no one can give what one does not have, nemo dat quod non
habet. One can sell only what one owns or is authorized to sell, and the buyer can
acquire no more right than what the seller can transfer legally.[13] Due to the
forged deed of sale, Delos Reyes acquired no right over the subject property
which she could convey to the Burgos siblings. All the transactions subsequent to
the falsified sale between the spouses Rufloe and Delos Reyes are likewise void,
including the sale made by the Burgos siblings to their aunt, Leonarda.

We now determine whether respondents Burgos siblings and Leonarda

Burgos were purchasers in good faith. It has been consistently ruled that a forged
deed can legally be the root of a valid title when an innocent purchaser for value
intervenes.[14]

An innocent purchaser for value is one who buys the property of another without
notice that some other person has a right to or interest in it, and who pays a full
and fair price at the time of the purchase or before receiving any notice of
another persons claim.[15] The burden of proving the status of a purchaser in good
faith and for value lies upon one who asserts that status. This onus
probandi cannot be discharged by mere invocation of the ordinary presumption
of good faith.[16]

As a general rule, every person dealing with registered land, as in this case, may
safely rely on the correctness of the certificate of title issued therefor and will in
no way oblige him to go beyond the certificate to determine the condition of the
property. However, this rule admits of an unchallenged exception:
a person dealing with registered land has a right to rely on the Torrens
certificate of 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 or when the purchaser has knowledge of a defect or the
lack of title in his vendor or of sufficient facts to induce a reasonably
prudent man to inquire into the status of the title of the property in
litigation. The presence of anything which excites or arouses suspicion
should then prompt the vendee to look beyond the certificate and
investigate the title of the vendor appearing on the face of said
certificate. One who falls within the exception can neither be
denominated an innocent purchaser for value nor a purchaser in good
faith and, hence, does not merit the protection of the law.[17]

The circumstances surrounding this case point to the absolute lack of good faith
on the part of respondents. The evidence shows that the Rufloes caused a notice
of adverse claim to be annotated on the title of Delos Reyes as early as November
5, 1979.[18] The annotation of an adverse claim is a measure designed to protect
the interest of a person over a piece of real property, and serves as a notice and
warning to third parties dealing with said property that someone is claiming an
interest on the same or may have a better right than the registered owner
thereof. Despite the notice of adverse claim, the Burgos siblings still purchased
the property in question.
Too, at the time the Burgos siblings bought the subject property on December 4,
1984, Civil Case No. M-7690,[19] an action for damages, and Criminal Case No.
10914-P,[20] for estafa, filed by the Rufloes against Delos Reyes, were both
pending before the RTC of Pasay City.This circumstance should have alerted the
Burgos siblings as to the validity of Delos Reyes title and her authority and legal
right to sell the property.

Equally significant is the fact that Delos Reyes was not in possession of the
subject property when she sold the same to the Burgossiblings. It was Amado
Burgos who bought the property for his children, the Burgos siblings. Amado was
not personally acquainted with Delos Reyes prior to the sale because he bought
the property through a real estate broker, a certain Jose Anias, and not from
Delos Reyes herself. There was no showing that Amado or any of the Burgos
siblings exerted any effort to personally verify with the Register of Deeds if Delos
Reyes certificate of title was clean and authentic. They merely relied on the title
as shown to them by the real estate broker. An ordinarily prudent man would
have inquired into the authenticity of the certificate of title, the propertys
location and its owners. Although it is a recognized principle that a person dealing
with registered land need not go beyond its certificate of title, it is also a firmly
established rule that where circumstances exist which would put a purchaser on
guard and prompt him to investigate further, such as the presence of
occupants/tenants on the property offered for sale, it is expected that the
purchaser would inquire first into the nature of possession of the occupants, i.e.,
whether or not the occupants possess the land in the concept of an
owner. Settled is the rule that a buyer of real property that is in the possession of
a person other than the seller must be wary and should investigate the rights of
those in possession. Otherwise, without such inquiry, the buyer can hardly be
regarded as a buyer in good faith.[21]
In the same vein, Leonarda cannot be categorized as a purchaser in good
faith. Since it was the Rufloes who continued to have actual possession of the
property, Leonarda should have investigated the nature of their possession.
We cannot ascribe good faith to those who have not shown any diligence in
protecting their rights. Respondents had knowledge of facts that should have led
them to inquire and investigate in order to acquaint themselves with possible
defects in the title of the seller of the property.However, they failed to do
so. Thus, Leonarda, as well as the Burgos siblings, cannot take cover under the
protection the law accords to purchasers in good faith and for value. They cannot
claim valid title to the property.

Moreover, the defense of indefeasibility of a Torrens title does not extend

to a transferee who takes it with notice of a flaw in the title of his transferor. To
be effective, the inscription in the registry must have been made in good faith. A
holder in bad faith of a certificate of title is not entitled to the protection of the
law, for the law cannot be used as a shield for fraud.[22]

We quote with approval the following findings of the trial court showing that the
sale between the Burgos siblings and Leonarda is simulated:

1. The sale was not registered, a circumstance which is inconceivable in

a legitimate transfer. A true vendee would not brook any delay in
registering the sale in his favor. Not only because registration is the
operative act that effects property covered by the Torrens System,
but also because registration and issuance of new title to the
transferee, enable this transferee to assume domiciliary and
possessory rights over the property. These benefits of ownership
shall be denied him if the titles of the property shall remain in the
name of vendor. Therefore, it is inconceivable as contrary to
behavioral pattern of a true buyer and the empirical knowledge of
man to assume that a buyer who invested on the property he bought
would be uninvolved and not endeavor to register the property he
bought. The nonchalance of Leonarda amply demonstrates the
pretended sale to her, and the evident scheme of her brother Amado
who invested on the property he bought.
2. Despite the sale of property to Leonarda, the sellers continued
paying taxes on the property from the time they acquired it from
Elvira in 1984 up to the present or a period of ten years. The tax
payment receipts remained in the name of Anita and her siblings,
(Exhibits 16 to 16-H). On the other hand, Leonarda does not even
pretend to have paid any tax on the land she allegedly bought in
1985. Even the Tax Declaration issued in 1988, three years after the
sale to her (Leonarda) is still in the name of her nieces and
nephew. These circumstances can only account for the fact that her
nieces and nephew remained the owners of the land and continued
paying taxes thereon.
3. Leonarda never exercised the attributes of ownership. Far from it,
she vested the exercise of domiciliary and possessory rights in her
brother Amado the father of Anita, Angelina, Angelito and Amy, by
constituting him with full power including the ejectment of plaintiffs,
to defend and to enter a compromise of any case he may file. She
allowed the children of Amado to remain as the registered owners of
the property without pressing for its transfer to her.
4. And, this simulated sale is the handiwork of Amado who apparently
acted advisedly to make it appear that his sister Leonarda as the
second transferee of the property is an innocent purchaser for
value. Since he or his children could not plausibly assume the stance
of a buyer in good faith from the forger Elvira Delos Reyes, knowing
of Elviras defective title, Amado hoped that the entry of his sister
Leonarda, might conjure the image and who might pass off as an
innocent purchaser, specially considering that the notice of adverse
claim of the Plaintiffs which was annotated in Elviras title was not,
strangely enough, NOT carried over in the title of his children, who
were made to appear as the sellers to their Aunt Leonarda.It was a
neat chicanery of Amado to bring the property out of the reach of
Plaintiffs thru a series of transfers involving a third party, to make her
appear as an innocent purchaser for value. His sister could be
manipulated to evict or oust the real owners from their own property
 thru a documentary manipulation. Unfortunately, his scheme has not
passed unnoticed by a discerning and impartial evaluator, like this
court. The Municipal Court of Muntinlupa in Civil Case No. 17446 has
even established that Amados children Anita and others are buyers in
bad faith who knew of the defective title of their transferor Elvira
Delos Reyes, the forger, as aforestated.

These circumstances taken altogether would show that the sale, which
occurred between Leonarda and the Burgos siblings, was simply a scheme
designed to cleanse the title passed on to them by the forger Delos Reyes.
Respondents had to resort to this strategy because they were fully aware that
their title, having originated from the forged deed of sale of Delos Reyes, was not
a clean and valid title. The trial court explained, thus:

And, this simulated sale is the handiwork of Amado who apparently

acted advisedly to make it appear that his sister Leonarda as the second
transferee of the property is an innocent purchaser for value. Since he
or his children could not plausibly assume the stamp of a buyer in good
faith from the forger Elvira Delos Reyes, knowing Elviras defective title,
Amado had hoped that the entry of his sister Leonarda, might conjure
the image and might pass off as an innocent purchaser. xxx. It was a
neat chicanery of Amado to bring the property out of the reach of
plaintiffs [herein petitioners] thru a series of transfers involving a third
party, to make her appear as an innocent purchaser for
value. Unfortunately, his scheme has not passed unnoticed by a
discerning and impartial evaluator, like this Court.[23] (Words in bracket
ours)

Patently, the Burgos siblings were not innocent purchasers for value and
the simulated sale to Leonarda did not remove the defect in their title.

Accordingly, we sustain the trial courts award of P20,000.00 as moral

damages, P50,000.00 as exemplary damages, and P50,000.00 as attorneys fees.[24]
 However, the actual damages in the amount of P134,200.00 should be
deleted. In view of this Courts ruling that the property rightfully belongs to
petitioners and must be restored to them, there is no more basis for the award of
said actual damages to the Rufloes.

WHEREFORE, the petition for review is hereby GRANTED. The assailed decision
and resolution of the Court of Appeals in CA-G.R. CV. No. 49939 are REVERSED
and SET ASIDE. Accordingly, the decision of the trial court is hereby REVIVED,
except the award of actual damages which must be deleted.

SO ORDERED.
G.R. No. L-2746 December 6, 1906

MATEO CARIÑO, petitioner-appellant,

vs.
THE INSULAR GOVERNMENT, respondent-appellee.

Coudert Brothers for appellant.

Attorney-General Wilfley for appellee.

WILLARD, J.:

The appellant, on the 23d of June, 1903, by his attorney in fact, Metcalf A. Clarke, filed a petition in
the Court of Land Registration asking that he be inscribed as the owner of a tract of land in the
municipality of Baguio, in the province of Benguet, containing 146 hectares. The Government of the
Philippine Islands, appeared in the Court of Land Registration and opposed the petition. The
Government of the United States that the land was part of the military reservation of Baguio.
Judgment was entered in the Court of Land Registration in favor of the petitioner, from which
judgment the respondents appealed in accordance with the law then in force to the Court of First
Instance of the province of Benguet. The case was therein tried de novo, and judgment was entered
dismissing the petition. The petitioner has brought the case here by bill of exceptions.

The petitioner presented no documentary evidence of title, except a possessory information obtained
in 1901. By the provisions of the Mortgage Law, under which this possessory information was
obtained (art. 394), it produced only those effects which the laws give to mere possession.

The petition not having shown any title from the Government, and the land being agricultural, the
case is governed by the decisions of this court in the cases of Valenton et al. vs. Murciano 1 (2 Off.
Gaz., 434); Cansino et al. vs. Valdez et al. 2 (4 Off. Gaz., 488); and Tiglao vs. The Insular
Government 3 (4 Off. Gaz., 747). In these cases it was held that the mere possession of land
such as that in controversy in this case would give the possessor and title thereto as against
the Government; in other words, that the statute of limitations did not run against the State in
reference to its agricultural lands. lawphil.net

The petitioner, however, insists that although the statute of limitations as such did not run against the
Government of Spain in the Philippine Islands, yet a grant is to be conclusively presumed from
immemorial use and occupation. To say that the presumption of a grant is presumption of law is, in
our opinion, simply to say that it amounts to a statute of limitations; and for a court to hold that the
statute of limitations does not run against the Government as to its public agricultural lands, and at
the same time to hold that if a person has been in possession of such lands for thirty years it is
conclusively presumed that the Government has given him a deed therefor, would be to make two
rulings directly inconsistent with each other.

Considered as a presumption of fact, the contention could not be sustained in this particular case.
Here the surrounding circumstances are incompatible with the existence of a grant, It is known that
for nearly three hundred years all attempts to convert the Igorots of the Province of Benguet to the
Christian religion completely failed, and that during that time they remained practically in the same
condition as they were when the Islands were first occupied by the Spaniards. To presume as a
matter of fact that during that time, and down to at least 1880, the provisions of the laws relating to
the grant, adjustment, and sale of public were taken advantage of by these deeds from the
Government for these lands would be to presume something which did not exist. The appellant says
in his brief (p.10):

The Igorot, no less than the American Indian, is an aborigine, and is equally ignorant of the
forms of law and procedure necessary to protect his interests.

There is, moreover, in the case evidence that in 1894 the petitioner sought to obtain title from the
Government in accordance with the laws then in force. In 1901 he made a contract with Metalcalf A.
Clarke, by the terms of which he agreed to sell the land to Clarke for 6,000 pesos when he obtained
title thereto from the Government, and this contract he does not say that he is the owner, but simply
that he is in possession thereof. The court below found that the land is now worth upwards of
P50,000.

The possession of the land has not been of such a character as to require the presumption of a
grant. No one has lived upon it for many years. It was never used for anything but pasturage of
animals, except insignificant portions thereof, and since the insurrection against Spain it has
apparently not been used by the petitioner for any purpose.

The petitioner relies upon the case of the United States vs. Chaves (159 U.S., 452) and the case of
The United States vs. Chaves (175 U.S., 509). In the case of Hays vs. The United States (175 U.S.
248) the court said at page 261;

But this presumption is subject to the limitation that where title is claimed from a deed which
is shown to be void, it will not be presumed that there was an independent grant
(Smith vs. Highbee, 12 Vermont,. 113), or where surrounding circumstances are inconsistent
with the theory of a grant. (Townsend vs. Downer, 32 Vermont, 183).

The substance of this doctrine is that lapse of time any be treated as helping out the
presumption of a grant, but where a void grant is shown, it affords no presumption that
another valid grant was made. Nor does such presumption arise if the surrounding
circumstances are incompatible with the existence of a grant. In this case under
consideration we can not find any evidence which justifies us in believing that a legal grant
can have been made, and under those circumstances we can not consider possession since
the date of the treaty as dispensing with the requirement that the title, if not perfect at that
time, was one which the claimant would have a lawful right to make perfect had the territory
not been acquired by the United States.

In the case of Chaves vs. The United States (175 U.S., 552) the court made the following statement
at page 562:

Finally, it distinctly appears that the possession of the parties is insufficient in length of time
to prove a valid title. In United States vs. Chaves (159 U.S., 452) the possession was under
the claim of a grant made by the governor of New Mexico to the alleged grantees. The grant
had been lost, but it had been seen and read by witnesses, and its existence had been
proved by evidence sufficient, as we stated in the opinion (p. 460), to warrant 'the finding of
the court below that the complainant's title was derived from the Republic of Mexico, and
was complete and perfect at the date when the United States acquired sovereignty in the
territory of New Mexico, within which the land was situated. We do not question the
correctness to the remarks made by Mr. Justice Shiras in regard to evidence of possession
 and the presumptions which may under certain circumstances drawn as to the existence of a
grant.

We do not deny the right of the duty of a court to presume its existence in a proper case, in
order to quiet a title and to give to long continued possession the quality of a rightful
possession under a legal right. We recognized and enforced such a rule in the case of
United States vs. Chaves decided at this term. in which the question is involved. We simply
say in this case that the possession was not a duration long enough to justify any such
inference.

There is no proof of any valid grant, but on the contrary the evidence offered by the plaintiff
himself and upon which the bases the title that he asks the court to confirm, shows the
existence of a grant from a body which had no legal power to make it, and which, therefore,
conveyed no title whatever to its grantee, and the evidence is, as given by the plaintiff
himself, that it was under this grant alone that possession of the lands was taken. We can
not presume (within the time involved in this case) that any other and valid grant was ever
made. The possession of the plaintiff and of his grantors up to the time of the treaty of
Guadalupe Hidalgo, in 1848, had not been long enough to presume a grant.
(Crispin vs. United States, 168 U.S., 208; Hayes vs.United States, 170 U.S., 637, 649, 653;
Hays vs. The United States, ante 248.) The possession subsequently existing, we can not
notice. Same authorities.

As we understand it, it is well settled in the United States that prescription does not run against the
Government as to its public lands — in other words, that if a person desires to obtain title to the
public lands of the United States situated within the boundaries of the States, he must do so in the
way pointed out by the law. We do not understand that a person in possession of unsurveyed public
lands in the State of Minnesota, for example, whose ancestors had occupied that the land for fortyh
years, could maintain in court a claim that he was the legal owner of the lands by granted the land to
his ancestors, a presumption founded not upon any proceedings taken in the General Land Office to
acquire a patent thereto, but upon the mere possession for that length of time.

The same is true of the public lands of Spain in the Philippine Islands. In the case of Valenton et al.
vs. Marciano it was said:

While the State has always recognized the right of the occupant to a deed if he proves a
possession for a sufficient length of time, yet it has always insisted that he must make that
proof before the proper administrative officers, and obtain from them his deed, and until he
did the State remained the absolute owner.

But in any event, and whatever the law may be elsewhere, it seems clear that this doctrine of
presumptive grant can not apply to the Philippines in view of the Spanish legislation for the Indies.
From time to time there were promulgated laws which required the person in possession of public
lands to exhibit their titles or grants thereto. If these titles or grants were found to be good, they were
confirmed, but if they were not, or if the persons had no grants or titles at all, they were evicted from
the land.

For example, in Law 14, title 12, 4, Recompilation of the Laws of the Indies, it is stated:

We therefore order and command that all viceroys and presidents of pretrial courts
designate, at such times as shall to them most expedient, a suitable period within which all
possessors of tracts, farms, plantations, and estates shall exhibit to them and to the court
officers appointed by them for this purpose their title deeds thereto. And those who are in
 possession by virtue of proper deeds and receipts or by virtue of just prescriptive rights shall
be protected, and all the rest shall be restored to us to be disposed of at our will.

In the Royal Cedula of October 15, 1754, it was provided —

that any and all persons who, since the year 1700, and up to the date of promulgation and
publication of said order, shall have occupied royal lands, whether or not the same shall be
cultivated or tenanted, may, either in person or through their attorneys or representatives,
appear and exhibit to said subdelegates the titles and patents by virtue of which said lands
are occupied. Said subdelegates will designate as the period within which documents must
be presented a term sufficient in length and proportionate to the distance the interested party
may have to travel for the purpose of making the presentation. Said subdelegates will at the
same time warn the parties interested that in term designated, without a just and valid reason
therefor, they will be deprived of and evicted from their lands, and they will be granted to
others.

In the regulations of June 25, 1880, it was provided as follows:

ART. 8. If the interested parties shall not ask an adjustment of the lands whose possession
they are unlawfully enjoining within the time of one year, or, the adjustment having been
granted by the authorities, they shall fail to fulfill their obligation in connection with the
compromise, by paying the proper sum into the treasury, the latter will, by virtue of the
authority vested in it, reassert the ownership of the Stated over the lands, and will, after fixing
the whole thereof, proceed to sell at public auction that part of the same which, either
because it may have been reduced to cultivation or is not located within the forest zone, is
not deemed advisable to preserve as State forest reservations. 4

In the royal decree of the 13th of February, 1894, published in the Official Gazzette of Manila of the
17th of April, 01894, it is provided in article 4 as follows:

ART. 4. The title to all agricultural lands which were capable of adjustment (composicion)
under the royal decree of the 25th of June, 1880, but the adjustments of which decree in the
Gaceta de Manila, will revert to the State. Any claim to such lands by those who might have
applied for the adjustment of the same, but who have not done so as the above mentioned
date, will not avail them in any way or at any time.

In view of these provisions of the law, it seems to us impossible to say that as to the public
agricultural lands in the Philippines there existed a conclusive presumption after a lapse of thirty or
any other number of years that the Government of Spain had granted to the possessor thereof a
legal title thereto.

The plaintiff is not entitled to the benefits of paragraph 6 of section 54 of Act No. 926, the Public
Land Act, for the reason that act is not applicable to the Province of Benguet. The judgment of the
court below is affirmed, with the costs of this instance against the appellant.

After the expiration of twenty days let judgment be entered accordingly and ten days thereafter the
case be returned to the court below for execution. So ordered.
Cruz vs Secretary of DENR
Natural Resources and Environmental Law; Constitutional Law; IPRA; Regalian
Doctrine

GR. No. 135385, Dec. 6, 2000

FACTS:

Petitioners Isagani Cruz and Cesar Europa filed a suit for prohibition and mandamus as
citizens and taxpayers, assailing the constitutionality of certain provisions of Republic Act
No. 8371, otherwise known as the Indigenous People’s Rights Act of 1997 (IPRA) and its
implementing rules and regulations (IRR). The petitioners assail certain provisions of the
IPRA and its IRR on the ground that these amount to an unlawful deprivation of the State’s
ownership over lands of the public domain as well as minerals and other natural resources
therein, in violation of the regalian doctrine embodied in section 2, Article XII of the
Constitution.

ISSUE:

Do the provisions of IPRA contravene the Constitution?

HELD:

No, the provisions of IPRA do not contravene the Constitution. Examining the IPRA, there
is nothing in the law that grants to the ICCs/IPs ownership over the natural resources
within their ancestral domain. Ownership over the natural resources in the ancestral
domains remains with the State and the rights granted by the IPRA to the ICCs/IPs over the
natural resources in their ancestral domains merely gives them, as owners and occupants of
the land on which the resources are found, the right to the small scale utilization of these
resources, and at the same time, a priority in their large scale development and exploitation.

Additionally, ancestral lands and ancestral domains are not part of the lands of the public
domain. They are private lands and belong to the ICCs/IPs by native title, which is a concept
of private land title that existed irrespective of any royal grant from the State. However, the
right of ownership and possession by the ICCs/IPs of their ancestral domains is a limited
form of ownership and does not include the right to alienate the same.
HEIRS OF MARIO MALABANAN, G.R. No. 179987
Petitioner,
Present:
PUNO, C.J.,
QUISUMBING,
YNARES-SANTIAGO,
CARPIO,
- versus - AUSTRIA-MARTINEZ,
CORONA,
CARPIO MORALES,
TINGA,
CHICO-NAZARIO,
VELASCO, JR.,
NACHURA,
LEONARDO DE CASTRO,
BRION,
REPUBLIC OF THE PHILIPPINES, PERALTA, and
Respondent. BERSAMIN, JJ.

Promulgated:

April 29, 2009

x--------------------------------------------------------------------------- x

DECISION

TINGA, J.:
One main reason why the informal sector has not become formal is that
from Indonesia to Brazil, 90 percent of the informal lands are not titled and
registered. This is a generalized phenomenon in the so-called Third World. And it
has many consequences.

xxx
 The question is: How is it that so many governments, from
Suharto's in Indonesia to Fujimori's in Peru, have wanted to title these
people and have not been able to do so effectively? One reason is that
none of the state systems in Asia or Latin America can gather proof of
informal titles. In Peru, the informals have means of proving property
ownership to each other which are not the same means developed by the
Spanish legal system. The informals have their own papers, their own
forms of agreements, and their own systems of registration, all of which
are very clearly stated in the maps which they use for their own informal
business transactions.
If you take a walk through the countryside, from Indonesia to Peru,
and you walk by field after field--in each field a different dog is going to
bark at you. Even dogs know what private property is all about. The only
one who does not know it is the government. The issue is that there exists
a "common law" and an "informal law" which the Latin American formal
legal system does not know how to recognize.
- Hernando De Soto[1]

This decision inevitably affects all untitled lands currently in possession of

persons and entities other than the Philippine government. The petition, while
unremarkable as to the facts, was accepted by the Court en banc in order to provide
definitive clarity to the applicability and scope of original registration proceedings
under Sections 14(1) and 14(2) of the Property Registration Decree. In doing so,
the Court confronts not only the relevant provisions of the Public Land Act and the
Civil Code, but also the reality on the ground. The countrywide phenomenon of
untitled lands, as well as the problem of informal settlement it has spawned, has
unfortunately been treated with benign neglect. Yet our current laws are hemmed
in by their own circumscriptions in addressing the phenomenon. Still, the duty on
our part is primarily to decide cases before us in accord with the Constitution and
the legal principles that have developed our public land law, though our social
obligations dissuade us from casting a blind eye on the endemic problems.

I.
On 20 February 1998, Mario Malabanan filed an application for land registration
covering a parcel of land identified as Lot 9864-A, Cad-452-D, Silang
Cadastre,[2] situated in Barangay Tibig, Silang Cavite, and consisting of 71,324
square meters. Malabanan claimed that he had purchased the property from
Eduardo Velazco,[3] and that he and his predecessors-in-interest had been in open,
notorious, and continuous adverse and peaceful possession of the land for more
than thirty (30) years.

The application was raffled to the Regional Trial Court of (RTC) Cavite-
Tagaytay City, Branch 18. The Office of the Solicitor General (OSG) duly
designated the Assistant Provincial Prosecutor of Cavite, Jose Velazco, Jr., to
appear on behalf of the State.[4] Apart from presenting documentary evidence,
Malabanan himself and his witness, Aristedes Velazco, testified at the hearing.
Velazco testified that the property was originally belonged to a twenty-two hectare
property owned by his great-grandfather, Lino Velazco. Lino had four sons
Benedicto, Gregorio, Eduardo and Estebanthe fourth being Aristedess grandfather.
Upon Linos death, his four sons inherited the property and divided it among
themselves. But by 1966, Estebans wife, Magdalena, had become the administrator
of all the properties inherited by the Velazco sons from their father, Lino. After the
death of Esteban and Magdalena, their son Virgilio succeeded them in
administering the properties, including Lot9864-A, which originally belonged to
his uncle, Eduardo Velazco. It was this property that was sold by Eduardo Velazco
to Malabanan.[5]

Assistant Provincial Prosecutor Jose Velazco, Jr. did not cross-examine

Aristedes Velazco. He further manifested that he also [knew] the property and I
affirm the truth of the testimony given by Mr. Velazco.[6] The Republic of
the Philippines likewise did not present any evidence to controvert the application.
 Among the evidence presented by Malabanan during trial was a Certification
dated 11 June 2001, issued by the Community Environment & Natural Resources
Office, Department of Environment and Natural Resources (CENRO-DENR),
which stated that the subject property was verified to be within the Alienable or
Disposable land per Land Classification Map No. 3013 established under Project
No. 20-A and approved as such under FAO 4-1656 on March 15, 1982.[7]

On 3 December 2002, the RTC rendered judgment in favor of Malabanan,

the dispositive portion of which reads:

WHEREFORE, this Court hereby approves this application for registration

and thus places under the operation of Act 141, Act 496 and/or P.D. 1529,
otherwise known as Property Registration Law, the lands described in Plan Csd-
04-0173123-D, Lot 9864-A and containing an area of Seventy One Thousand
Three Hundred Twenty Four (71,324) Square Meters, as supported by its technical
description now forming part of the record of this case, in addition to other proofs
adduced in the name of MARIO MALABANAN, who is of legal age, Filipino,
widower, and with residence at Munting Ilog, Silang, Cavite.

Once this Decision becomes final and executory, the corresponding decree
of registration shall forthwith issue.

SO ORDERED.

The Republic interposed an appeal to the Court of Appeals, arguing that

Malabanan had failed to prove that the property belonged to the alienable and
disposable land of the public domain, and that the RTC had erred in finding that he
had been in possession of the property in the manner and for the length of time
required by law for confirmation of imperfect title.

On 23 February 2007, the Court of Appeals rendered a Decision[8] reversing

the RTC and dismissing the application of Malabanan. The appellate court held
that under Section 14(1) of the Property Registration Decree any period of
possession prior to the classification of the lots as alienable and disposable was
inconsequential and should be excluded from the computation of the period of
possession. Thus, the appellate court noted that since the CENRO-DENR
certification had verified that the property was declared
alienable and disposable only on 15 March 1982, the Velazcos possession prior to
that date could not be factored in the computation of the period of possession. This
interpretation of the Court of Appeals of Section 14(1) of the Property Registration
Decree was based on the Courts ruling in Republic v. Herbieto.[9]

Malabanan died while the case was pending with the Court of
Appeals;[10] hence, it was his heirs who appealed the decision of the appellate
court. Petitioners, before this Court, rely on our ruling in Republic v.
Naguit,[11] which was handed down just four months prior to Herbieto. Petitioners
suggest that the discussion in Herbieto cited by the Court of Appeals is
actually obiter dictum since the Metropolitan Trial Court therein which had
directed the registration of the property had no jurisdiction in the first place since
the requisite notice of hearing was published only after the hearing had already
begun. Naguit, petitioners argue, remains the controlling doctrine, especially when
the property in question is agricultural land. Therefore, with respect to agricultural
lands, any possession prior to the declaration of the alienable property as
disposable may be counted in reckoning the period of possession to perfect title
under the Public Land Act and the Property Registration Decree.

The petition was referred to the Court en banc,[12] and on 11 November

2008, the case was heard on oral arguments. The Court formulated the principal
issues for the oral arguments, to wit:

1. In order that an alienable and disposable land of the public domain may
be registered under Section 14(1) of Presidential Decree No. 1529, otherwise
known as the Property Registration Decree, should the land be classified as
alienable and disposable as of June 12, 1945 or is it sufficient that such
 classification occur at any time prior to the filing of the applicant for registration
provided that it is established that the applicant has been in open, continuous,
exclusive and notorious possession of the land under a bona fide claim of
ownership since June 12, 1945 or earlier?

2. For purposes of Section 14(2) of the Property Registration Decree may a

parcel of land classified as alienable and disposable be deemed private land and
therefore susceptible to acquisition by prescription in accordance with the Civil
Code?

3. May a parcel of land established as agricultural in character either

because of its use or because its slope is below that of forest lands be registrable
under Section 14(2) of the Property Registration Decree in relation to the
provisions of the Civil Code on acquisitive prescription?

4. Are petitioners entitled to the registration of the subject land in their

names under Section 14(1) or Section 14(2) of the Property Registration Decree or
both?[13]

Based on these issues, the parties formulated their respective positions.

With respect to Section 14(1), petitioners reiterate that the analysis of the
Court in Naguit is the correct interpretation of the provision. The seemingly
contradictory pronouncement in Herbieto, it is submitted, should be
considered obiter dictum, since the land registration proceedings therein was
void ab initio due to lack of publication of the notice of initial hearing. Petitioners
further point out that in Republic v. Bibonia,[14] promulgated in June of 2007, the
Court applied Naguit and adopted the same observation that the preferred
interpretation by the OSG of Section 14(1) was patently absurd. For its part, the
OSG remains insistent that for Section 14(1) to apply, the land should have been
classified as alienable and disposable as of 12 June 1945. Apart from Herbieto, the
OSG also cites the subsequent rulings in Buenaventura v. Republic,[15] Fieldman
Agricultural Trading v. Republic[16] and Republic v. Imperial Credit
Corporation,[17] as well as the earlier case of Director of Lands v. Court of
Appeals.[18]
 With respect to Section 14(2), petitioners submit that open, continuous,
exclusive and notorious possession of an alienable land of the public domain for
more than 30 years ipso jure converts the land into private property, thus placing it
under the coverage of Section 14(2). According to them, it would not matter
whether the land sought to be registered was previously classified as agricultural
land of the public domain so long as, at the time of the application, the property
had already been converted into private property through prescription. To bolster
their argument, petitioners cite extensively from our 2008 ruling in Republic v.
T.A.N. Properties.[19]

The arguments submitted by the OSG with respect to Section 14(2) are more
extensive. The OSG notes that under Article 1113 of the Civil Code, the
acquisitive prescription of properties of the State refers to patrimonial property,
while Section 14(2) speaks of private lands. It observes that the Court has yet to
decide a case that presented Section 14(2) as a ground for application for
registration, and that the 30-year possession period refers to the period of
possession under Section 48(b) of the Public Land Act, and not the concept of
prescription under the Civil Code. The OSG further submits that, assuming that the
30-year prescriptive period can run against public lands, said period should be
reckoned from the time the public land was declared alienable and disposable.

Both sides likewise offer special arguments with respect to the particular
factual circumstances surrounding the subject property and the ownership thereof.

II.

First, we discuss Section 14(1) of the Property Registration Decree. For a full
understanding of the provision, reference has to be made to the Public Land Act.
 A.

Commonwealth Act No. 141, also known as the Public Land Act, has, since
its enactment, governed the classification and disposition of lands of the public
domain. The President is authorized, from time to time, to classify the lands of the
public domain into alienable and disposable, timber, or mineral lands.[20] Alienable
and disposable lands of the public domain are further classified according to their
uses into (a) agricultural; (b) residential, commercial, industrial, or for similar
productive purposes; (c) educational, charitable, or other similar purposes; or (d)
reservations for town sites and for public and quasi-public uses.[21]

May a private person validly seek the registration in his/her name of

alienable and disposable lands of the public domain? Section 11 of the Public Land
Act acknowledges that public lands suitable for agricultural purposes may be
disposed of by confirmation of imperfect or incomplete titles through judicial
legalization.[22] Section 48(b) of the Public Land Act, as amended by P.D. No.
1073, supplies the details and unmistakably grants that right, subject to the
requisites stated therein:

Sec. 48. The following described citizens of the Philippines, occupying

lands of the public domain or claiming to own any such land or an interest
therein, but whose titles have not been perfected or completed, may apply to the
Court of First Instance of the province where the land is located for confirmation
of their claims and the issuance of a certificate of title therefor, under the Land
Registration Act, to wit:

xxx

(b) Those who by themselves or through their predecessors in interest

have been in open, continuous, exclusive, and notorious possession and
occupation of alienable and disposable lands of the public domain, under a bona
fide claim of acquisition of ownership, since June 12, 1945, or earlier,
immediately preceding the filing of the application for confirmation of title
except when prevented by war or force majeure. These shall be conclusively
presumed to have performed all the conditions essential to a Government grant
and shall be entitled to a certificate of title under the provisions of this chapter.
Section 48(b) of Com. Act No. 141 received its present wording in 1977 when the
law was amended by P.D. No. 1073. Two significant amendments were introduced
by P.D. No. 1073. First, the term agricultural lands was changed to alienable and
disposable lands of the public domain. The OSG submits that this amendment
restricted the scope of the lands that may be registered.[23] This is not actually the
case. Under Section 9 of the Public Land Act, agricultural lands are a mere subset
of lands of the public domain alienable or open to disposition. Evidently, alienable
and disposable lands of the public domain are a larger class than only agricultural
lands.

Second, the length of the requisite possession was changed from possession for
thirty (30) years immediately preceding the filing of the application to possession
since June 12, 1945 or earlier. The Court in Naguit explained:

When the Public Land Act was first promulgated in 1936, the period of
possession deemed necessary to vest the right to register their title to agricultural
lands of the public domain commenced from July 26, 1894. However, this period
was amended by R.A. No. 1942, which provided that the bona fide claim of
ownership must have been for at least thirty (30) years. Then in 1977, Section
48(b) of the Public Land Act was again amended, this time by P.D. No. 1073,
which pegged the reckoning date at June 12, 1945. xxx

It bears further observation that Section 48(b) of Com. Act No, 141 is virtually the
same as Section 14(1) of the Property Registration Decree. Said Decree codified
the various laws relative to the registration of property, including lands of the
public domain. It is Section 14(1) that operationalizes the registration of such lands
of the public domain. The provision reads:

SECTION 14. Who may apply. The following persons may file in the
proper Court of First Instance an application for registration of title to land,
whether personally or through their duly authorized representatives:
 (1) those who by themselves or through their predecessors-in-
interest have been in open, continuous, exclusive and
notorious possession and occupation of alienable and
disposable lands of the public domain under a bona fide claim
of ownership since June 12, 1945, or earlier.

Notwithstanding the passage of the Property Registration Decree and the

inclusion of Section 14(1) therein, the Public Land Act has remained in effect. Both
laws commonly refer to persons or their predecessors-in-interest who have been in
open, continuous, exclusive and notorious possession and occupation of alienable
and disposable lands of the public domain under a bona fide claim of ownership
since June 12, 1945, or earlier. That circumstance may have led to the impression
that one or the other is a redundancy, or that Section 48(b) of the Public Land Act
has somehow been repealed or mooted. That is not the case.

The opening clauses of Section 48 of the Public Land Act and Section 14 of
the Property Registration Decree warrant comparison:

Sec. 48 [of the Public Land Act]. The following described citizens of the
Philippines, occupying lands of the public domain or claiming to own any such
land or an interest therein, but whose titles have not been perfected or completed,
may apply to the Court of First Instance of the province where the land is located
for confirmation of their claims and the issuance of a certificate of title therefor,
under the Land Registration Act, to wit:

xxx

Sec. 14 [of the Property Registration Decree]. Who may apply. The
following persons may file in the proper Court of First Instance an application for
registration of title to land, whether personally or through their duly authorized
representatives:

xxx
 It is clear that Section 48 of the Public Land Act is more descriptive of the
nature of the right enjoyed by the possessor than Section 14 of the Property
Registration Decree, which seems to presume the pre-existence of the right, rather
than establishing the right itself for the first time. It is proper to assert that it is the
Public Land Act, as amended by P.D. No. 1073 effective 25 January 1977, that has
primarily established the right of a Filipino citizen who has been in open,
continuous, exclusive, and notorious possession and occupation of alienable and
disposable lands of the public domain, under a bona fide claim of acquisition of
ownership, since June 12, 1945 to perfect or complete his title by applying with the
proper court for the confirmation of his ownership claim and the issuance of the
corresponding certificate of title.

Section 48 can be viewed in conjunction with the afore-quoted Section 11 of

the Public Land Act, which provides that public lands suitable for agricultural
purposes may be disposed of by confirmation of imperfect or incomplete titles, and
given the notion that both provisions declare that it is indeed the Public Land Act
that primarily establishes the substantive ownership of the possessor who has been
in possession of the property since 12 June 1945. In turn, Section 14(a) of the
Property Registration Decree recognizes the substantive right granted under
Section 48(b) of the Public Land Act, as well provides the corresponding original
registration procedure for the judicial confirmation of an imperfect or incomplete
title.

There is another limitation to the right granted under Section 48(b). Section 47 of
the Public Land Act limits the period within which one may exercise the right to
seek registration under Section 48. The provision has been amended several times,
most recently by Rep. Act No. 9176 in 2002. It currently reads thus:

Section 47. The persons specified in the next following section are hereby
granted time, not to extend beyond December 31, 2020 within which to avail of
the benefits of this Chapter: Provided, That this period shall apply only where the
 area applied for does not exceed twelve (12) hectares: Provided, further, That the
several periods of time designated by the President in accordance with Section
Forty-Five of this Act shall apply also to the lands comprised in the provisions of
this Chapter, but this Section shall not be construed as prohibiting any said persons
from acting under this Chapter at any time prior to the period fixed by the
President.[24]

Accordingly under the current state of the law, the substantive right granted under
Section 48(b) may be availed of only until 31 December 2020.

B.

Despite the clear text of Section 48(b) of the Public Land Act, as amended
and Section 14(a) of the Property Registration Decree, the OSG has adopted the
position that for one to acquire the right to seek registration of an alienable and
disposable land of the public domain, it is not enough that the applicant and his/her
predecessors-in-interest be in possession under a bona fide claim of ownership
since 12 June 1945; the alienable and disposable character of the property must
have been declared also as of 12 June 1945. Following the OSGs approach, all
lands certified as alienable and disposable after 12 June 1945 cannot be registered
either under Section 14(1) of the Property Registration Decree or Section 48(b) of
the Public Land Act as amended. The absurdity of such an implication was
discussed in Naguit.

Petitioner suggests an interpretation that the alienable and disposable

character of the land should have already been established since June 12, 1945 or
earlier. This is not borne out by the plain meaning of Section 14(1). Since June 12,
1945, as used in the provision, qualifies its antecedent phrase under a bonafide
claim of ownership. Generally speaking, qualifying words restrict or modify only
the words or phrases to which they areimmediately associated, and not those
distantly or remotely located.[25] Ad proximum antecedents fiat relation nisi
impediatur sentencia.

Besides, we are mindful of the absurdity that would result if we adopt petitioners
position. Absent a legislative amendment, the rule would be, adopting the OSGs
view, that all lands of the public domain which were not declared alienable or
disposable before June 12, 1945 would not be susceptible to original registration,
 no matter the length of unchallenged possession by the occupant. Such
interpretation renders paragraph (1) of Section 14 virtually inoperative and even
precludes the government from giving it effect even as it decides to reclassify
public agricultural lands as alienable and disposable. The unreasonableness of the
situation would even be aggravated considering that before June 12, 1945,
the Philippines was not yet even considered an independent state.

Accordingly, the Court in Naguit explained:

[T]he more reasonable interpretation of Section 14(1) is that it merely

requires the property sought to be registered as already alienable and disposable at
the time the application for registration of title is filed. If the State, at the time the
application is made, has not yet deemed it proper to release the property for
alienation or disposition, the presumption is that the government is still reserving
the right to utilize the property; hence, the need to preserve its ownership in the
State irrespective of the length of adverse possession even if in good faith.
However, if the property has already been classified as alienable and disposable, as
it is in this case, then there is already an intention on the part of the State to
abdicate its exclusive prerogative over the property.

The Court declares that the correct interpretation of Section 14(1) is that
which was adopted in Naguit. The contrary pronouncement in Herbieto, as pointed
out in Naguit, absurdly limits the application of the provision to the point of virtual
inutility since it would only cover lands actually declared alienable and disposable
prior to 12 June 1945, even if the current possessor is able to establish open,
continuous, exclusive and notorious possession under a bona fide claim of
ownership long before that date.

Moreover, the Naguit interpretation allows more possessors under a bona

fide claim of ownership to avail of judicial confirmation of their imperfect titles
than what would be feasible under Herbieto. This balancing fact is significant,
especially considering our forthcoming discussion on the scope and reach of
Section 14(2) of the Property Registration Decree.
 Petitioners make the salient observation that the contradictory passages
from Herbieto are obiter dicta since the land registration proceedings therein is
void ab initio in the first place due to lack of the requisite publication of the notice
of initial hearing. There is no need to explicitly overturn Herbieto, as it suffices
that the Courts acknowledgment that the particular line of argument used therein
concerning Section 14(1) is indeed obiter.

It may be noted that in the subsequent case of Buenaventura,[26] the Court,

citing Herbieto, again stated that [a]ny period of possession prior to the date when
the [s]ubject [property was] classified as alienable and disposable is
inconsequential and should be excluded from the computation of the period of
possession That statement, in the context of Section 14(1), is certainly erroneous.
Nonetheless, the passage as cited in Buenaventura should again be considered
as obiter. The application therein was ultimately granted, citing Section 14(2). The
evidence submitted by petitioners therein did not establish any mode of possession
on their part prior to 1948, thereby precluding the application of Section 14(1). It is
not even apparent from the decision whether petitioners therein had claimed
entitlement to original registration following Section 14(1), their position being
that they had been in exclusive possession under a bona fide claim of ownership
for over fifty (50) years, but not before 12 June 1945.

Thus, neither Herbieto nor its principal discipular ruling Buenaventura has
any precedental value with respect to Section 14(1). On the other hand, the ratio
of Naguit is embedded in Section 14(1), since it precisely involved situation
wherein the applicant had been in exclusive possession under a bona fide claim of
ownership prior to 12 June 1945. The Courts interpretation of Section 14(1) therein
was decisive to the resolution of the case. Any doubt as to which
between Naguit or Herbieto provides the final word of the Court on Section 14(1)
is now settled in favor of Naguit.

We noted in Naguit that it should be distinguished from Bracewell v. Court of

Appeals[27] since in the latter, the application for registration had been
filed before the land was declared alienable or disposable. The dissent though
pronounces Bracewell as the better rule between the two. Yet two years
after Bracewell, its ponente, the esteemed Justice Consuelo Ynares-Santiago,
penned the ruling in Republic v. Ceniza,[28]which involved a claim of possession
that extended back to 1927 over a public domain land that was declared alienable
and disposable only in 1980. Ceniza cited Bracewell, quoted extensively from it,
and following the mindset of the dissent, the attempt at registration
in Cenizashould have failed. Not so.

To prove that the land subject of an application for registration is

alienable, an applicant must establish the existence of a positive act of the
government such as a presidential proclamation or an executive order; an
administrative action; investigation reports of Bureau of Lands investigators; and
a legislative act or a statute.

In this case, private respondents presented a certification dated November

25, 1994, issued by Eduardo M. Inting, the Community Environment and Natural
Resources Officer in the Department of Environment and Natural Resources
Office in Cebu City, stating that the lots involved were "found to be within the
alienable and disposable (sic) Block-I, Land Classification Project No. 32-A, per
map 2962 4-I555 dated December 9, 1980." This is sufficient evidence to show
the real character of the land subject of private respondents application. Further,
the certification enjoys a presumption of regularity in the absence of contradictory
evidence, which is true in this case. Worth noting also was the observation of the
Court of Appeals stating that:

[n]o opposition was filed by the Bureaus of Lands and

Forestry to contest the application of appellees on the ground that
the property still forms part of the public domain. Nor is there any
showing that the lots in question are forestal land....

Thus, while the Court of Appeals erred in ruling that mere possession of
public land for the period required by law would entitle its occupant to a
confirmation of imperfect title, it did not err in ruling in favor of private
respondents as far as the first requirement in Section 48(b) of the Public Land Act
is concerned, for they were able to overcome the burden of proving the
alienability of the land subject of their application.

As correctly found by the Court of Appeals, private respondents were able

to prove their open, continuous, exclusive and notorious possession of the subject
land even before the year 1927. As a rule, we are bound by the factual findings of
the Court of Appeals. Although there are exceptions, petitioner did not show that
[29]
this is one of them.
Why did the Court in Ceniza, through the same eminent member who
authored Bracewell, sanction the registration under Section 48(b) of public domain
lands declared alienable or disposable thirty-five (35) years and 180 days after 12
June 1945? The telling difference is that in Ceniza, the application for registration
was filed nearly six (6) years after the land had been declared alienable or
disposable, while in Bracewell, the application was filed nine (9) years before the
land was declared alienable or disposable. That crucial difference was also
stressed in Naguit to contradistinguish it from Bracewell, a difference which the
dissent seeks to belittle.

III.

We next ascertain the correct framework of analysis with respect to Section 14(2).
The provision reads:

SECTION 14. Who may apply. The following persons may file in the
proper Court of First Instance an application for registration of title to land,
whether personally or through their duly authorized representatives:

xxx

(2) Those who have acquired ownership over private lands by

prescription under the provisions of existing laws.

The Court in Naguit offered the following discussion concerning Section

14(2), which we did even then recognize, and still do, to be an obiter dictum, but
we nonetheless refer to it as material for further discussion, thus:

Did the enactment of the Property Registration Decree and the amendatory
P.D. No. 1073 preclude the application for registration of alienable lands of the
public domain, possession over which commenced only after June 12, 1945? It did
not, considering Section 14(2) of the Property Registration Decree, which governs
 and authorizes the application of those who have acquired ownership of private
lands by prescription under the provisions of existing laws.

Prescription is one of the modes of acquiring ownership under the Civil

Code.[[30]] There is a consistent jurisprudential rule that properties classified as
alienable public land may be converted into private property by reason of open,
continuous and exclusive possession of at least thirty (30) years.[[31]] With such
conversion, such property may now fall within the contemplation of private lands
under Section 14(2), and thus susceptible to registration by those who have
acquired ownership through prescription. Thus, even if possession of the alienable
public land commenced on a date later than June 12, 1945, and such possession
being been open, continuous and exclusive, then the possessor may have the right
to register the land by virtue of Section 14(2) of the Property Registration Decree.

Naguit did not involve the application of Section 14(2), unlike in this case where
petitioners have based their registration bid primarily on that provision, and where
the evidence definitively establishes their claim of possession only as far back as
1948. It is in this case that we can properly appreciate the nuances of the provision.

A.

The obiter in Naguit cited the Civil Code provisions on prescription as the possible
basis for application for original registration under Section 14(2). Specifically, it is
Article 1113 which provides legal foundation for the application. It reads:

All things which are within the commerce of men are susceptible of
prescription, unless otherwise provided. Property of the State or any of its
subdivisions not patrimonial in character shall not be the object of prescription.

It is clear under the Civil Code that where lands of the public domain are
patrimonial in character, they are susceptible to acquisitive prescription. On the
other hand, among the public domain lands that are not susceptible to acquisitive
prescription are timber lands and mineral lands. The Constitution itself proscribes
private ownership of timber or mineral lands.
 There are in fact several provisions in the Civil Code concerning the
acquisition of real property through prescription. Ownership of real property may
be acquired by ordinary prescription of ten (10) years,[32] or through extraordinary
prescription of thirty (30) years.[33]Ordinary acquisitive prescription requires
possession in good faith,[34] as well as just title.[35]

When Section 14(2) of the Property Registration Decree explicitly provides

that persons who have acquired ownership over private lands by prescription under
the provisions of existing laws, it unmistakably refers to the Civil Code as a valid
basis for the registration of lands. The Civil Code is the only existing law that
specifically allows the acquisition by prescription of private lands, including
patrimonial property belonging to the State. Thus, the critical question that needs
affirmation is whether Section 14(2) does encompass original registration
proceedings over patrimonial property of the State, which a private person has
acquired through prescription.

The Naguit obiter had adverted to a frequently reiterated jurisprudence

holding that properties classified as alienable public land may be converted into
private property by reason of open, continuous and exclusive possession of at least
thirty (30) years.[36] Yet if we ascertain the source of the thirty-year period,
additional complexities relating to Section 14(2) and to how exactly it operates
would emerge. For there are in fact two distinct origins of the thirty (30)-year
rule.

The first source is Rep. Act No. 1942, enacted in 1957, which amended
Section 48(b) of the Public Land Act by granting the right to seek original
registration of alienable public lands through possession in the concept of an owner
for at least thirty years.

The following-described citizens of the Philippines, occupying lands of

the public domain or claiming to own any such lands or an interest therein, but
 whose titles have not been perfected or completed, may apply to the Court of
First Instance of the province where the land is located for confirmation of their
claims and the issuance of a certificate of title therefor, under the Land
Registration Act, to wit:

xxx xxx xxx

(b) Those who by themselves or through their predecessors in interest

have been in open, continuous, exclusive and notorious possession and
occupation of agricultural lands of the public domain, under a bona fide claim of
acquisition of ownership, for at least thirty years immediately preceding the
filing of the application for confirmation of title, except when prevented by
war or force majeure. These shall be conclusively presumed to have performed
all the conditions essential to a Government grant and shall be entitled to a
certificate of title under the provisions of this Chapter. (emphasis supplied)[37]

This provision was repealed in 1977 with the enactment of P.D. 1073, which
made the date 12 June 1945 the reckoning point for the first time. Nonetheless,
applications for registration filed prior to 1977 could have invoked the 30-year rule
introduced by Rep. Act No. 1942.

The second source is Section 14(2) of P.D. 1529 itself, at least by

implication, as it applies the rules on prescription under the Civil Code, particularly
Article 1113 in relation to Article 1137. Note that there are two kinds of
prescription under the Civil Codeordinary acquisitive prescription and
extraordinary acquisitive prescription, which, under Article 1137, is completed
through uninterrupted adverse possession for thirty years, without need of title or of
good faith.

Obviously, the first source of the thirty (30)-year period rule, Rep. Act No.
1942, became unavailable after 1977. At present, the only legal basis for the thirty
(30)-year period is the law on prescription under the Civil Code, as mandated under
Section 14(2). However, there is a material difference between how the thirty (30)-
year rule operated under Rep. Act No. 1942 and how it did under the Civil Code.
 Section 48(b) of the Public Land Act, as amended by Rep. Act No. 1942, did
not refer to or call into application the Civil Code provisions on prescription. It
merely set forth a requisite thirty-year possession period immediately preceding the
application for confirmation of title, without any qualification as to whether the
property should be declared alienable at the beginning of, and continue as such,
throughout the entire thirty-(30) years. There is neither statutory nor jurisprudential
basis to assert Rep. Act No. 1942 had mandated such a requirement,[38] similar to
our earlier finding with respect to the present language of Section 48(b), which now
sets 12 June 1945 as the point of reference.

Then, with the repeal of Rep. Act No. 1942, the thirty-year possession period
as basis for original registration became Section 14(2) of the Property Registration
Decree, which entitled those who have acquired ownership over private lands by
prescription under the provisions of existing laws to apply for original registration.
Again, the thirty-year period is derived from the rule on extraordinary prescription
under Article 1137 of the Civil Code. At the same time, Section 14(2) puts into
operation the entire regime of prescription under the Civil Code, a fact which does
not hold true with respect to Section 14(1).

B.

Unlike Section 14(1), Section 14(2) explicitly refers to the principles on

prescription under existing laws. Accordingly, we are impelled to apply the civil
law concept of prescription, as set forth in the Civil Code, in our interpretation of
Section 14(2). There is no similar demand on our part in the case of Section 14(1).

The critical qualification under Article 1113 of the Civil Code is thus:
[p]roperty of the State or any of its subdivisions not patrimonial in character shall
not be the object of prescription. The identification what consists of patrimonial
property is provided by Articles 420 and 421, which we quote in full:
 Art. 420. The following things are property of public dominion:

(1) Those intended for public use, such as roads, canals, rivers, torrents, ports
and bridges constructed by the State, banks, shores, roadsteads, and others of
similar character;

(2) Those which belong to the State, without being for public use, and are
intended for some public service or for the development of the national
wealth.

Art. 421. All other property of the State, which is not of the character stated
in the preceding article, is patrimonial property

It is clear that property of public dominion, which generally includes property

belonging to the State, cannot be the object of prescription or, indeed, be subject of
the commerce of man.[39] Lands of the public domain, whether declared alienable
and disposable or not, are property of public dominion and thus insusceptible to
acquisition by prescription.

Let us now explore the effects under the Civil Code of a declaration by the
President or any duly authorized government officer of alienability and
disposability of lands of the public domain. Would such lands so declared alienable
and disposable be converted, under the Civil Code, from property of the public
dominion into patrimonial property? After all, by connotative definition, alienable
and disposable lands may be the object of the commerce of man; Article 1113
provides that all things within the commerce of man are susceptible to prescription;
and the same provision further provides that patrimonial property of the State may
be acquired by prescription.

Nonetheless, Article 422 of the Civil Code states that [p]roperty of public
dominion, when no longer intended for public use or for public service, shall form
part of the patrimonial property of the State. It is this provision that controls how
public dominion property may be converted into patrimonial property susceptible
to acquisition by prescription. After all, Article 420 (2) makes clear that those
property which belong to the State, without being for public use, and are intended
for some public service or for the development of the national wealth are public
dominion property. For as long as the property belongs to the State, although
already classified as alienable or disposable, it remains property of the public
dominion if when it is intended for some public service or for the development of
the national wealth.

Accordingly, there must be an express declaration by the State that the

public dominion property is no longer intended for public service or the
development of the national wealth or that the property has been converted
into patrimonial. Without such express declaration, the property, even if
classified as alienable or disposable, remains property of the public dominion,
pursuant to Article 420(2), and thus incapable of acquisition by prescription.
It is only when such alienable and disposable lands are expressly declared by
the State to be no longer intended for public service or for the development of
the national wealth that the period of acquisitive prescription can begin to
run. Such declaration shall be in the form of a law duly enacted by Congress
or a Presidential Proclamation in cases where the President is duly authorized
by law.

It is comprehensible with ease that this reading of Section 14(2) of the

Property Registration Decree limits its scope and reach and thus affects the
registrability even of lands already declared alienable and disposable to the
detriment of the bona fide possessors or occupants claiming title to the lands. Yet
this interpretation is in accord with the Regalian doctrine and its concomitant
assumption that all lands owned by the State, although declared alienable or
disposable, remain as such and ought to be used only by the Government.
 Recourse does not lie with this Court in the matter. The duty of the Court is
to apply the Constitution and the laws in accordance with their language and intent.
The remedy is to change the law, which is the province of the legislative branch.
Congress can very well be entreated to amend Section 14(2) of the Property
Registration Decree and pertinent provisions of the Civil Code to liberalize the
requirements for judicial confirmation of imperfect or incomplete titles.

The operation of the foregoing interpretation can be illustrated by an actual

example. Republic Act No. 7227, entitled An Act Accelerating The Conversion Of
Military Reservations Into Other Productive Uses, etc., is more commonly known
as the BCDA law. Section 2 of the law authorizes the sale of certain military
reservations and portions of military camps in Metro Manila,
including Fort Bonifacio and Villamor Air Base. For purposes of effecting the sale
of the military camps, the law mandates the President to transfer such military
lands to the Bases Conversion Development Authority (BCDA)[40] which in turn is
authorized to own, hold and/or administer them.[41] The President is authorized to
sell portions of the military camps, in whole or in part.[42] Accordingly, the BCDA
law itself declares that the military lands subject thereof are alienable and
disposable pursuant to the provisions of existing laws and regulations governing
sales of government properties.[43]

From the moment the BCDA law was enacted the subject military lands
have become alienable and disposable. However, said lands did not become
patrimonial, as the BCDA law itself expressly makes the reservation that these
lands are to be sold in order to raise funds for the conversion of the former
American bases at Clark and Subic.[44] Such purpose can be tied to either public
service or the development of national wealth under Article 420(2). Thus, at that
time, the lands remained property of the public dominion under Article 420(2),
notwithstanding their status as alienable and disposable. It is upon their sale as
authorized under the BCDA law to a private person or entity that such lands
become private property and cease to be property of the public dominion.

C.

Should public domain lands become patrimonial because they are declared
as such in a duly enacted law or duly promulgated proclamation that they are no
longer intended for public service or for the development of the national wealth,
would the period of possession prior to the conversion of such public dominion
into patrimonial be reckoned in counting the prescriptive period in favor of the
possessors? We rule in the negative.

The limitation imposed by Article 1113 dissuades us from ruling that the period of
possession before the public domain land becomes patrimonial may be counted for
the purpose of completing the prescriptive period. Possession of public dominion
property before it becomes patrimonial cannot be the object of prescription
according to the Civil Code. As the application for registration under Section 14(2)
falls wholly within the framework of prescription under the Civil Code, there is no
way that possession during the time that the land was still classified as public
dominion property can be counted to meet the requisites of acquisitive prescription
and justify registration.

Are we being inconsistent in applying divergent rules for Section 14(1) and
Section 14(2)? There is no inconsistency. Section 14(1) mandates registration on
the basis of possession, while Section 14(2) entitles registration on the basis
of prescription. Registration under Section 14(1) is extended under the aegis
of the Property Registration Decree and the Public Land Act while
registration under Section 14(2) is made available both by the Property
Registration Decree and the Civil Code.
In the same manner, we can distinguish between the thirty-year period under
Section 48(b) of the Public Land Act, as amended by Rep. Act No. 1472, and the
thirty-year period available through Section 14(2) of the Property Registration
Decree in relation to Article 1137 of the Civil Code. The period under the
former speaks of a thirty-year period of possession, while the period under the
latter concerns a thirty-year period of extraordinary
prescription. Registration under Section 48(b) of the Public Land Act as
amended by Rep. Act No. 1472 is based on thirty years of possession alone
without regard to the Civil Code, while the registration under Section 14(2) of
the Property Registration Decree is founded on extraordinary prescription
under the Civil Code.

It may be asked why the principles of prescription under the Civil Code should not
apply as well to Section 14(1). Notwithstanding the vaunted status of the Civil
Code, it ultimately is just one of numerous statutes, neither superior nor inferior to
other statutes such as the Property Registration Decree. The legislative branch is
not bound to adhere to the framework set forth by the Civil Code when it enacts
subsequent legislation. Section 14(2) manifests a clear intent to interrelate the
registration allowed under that provision with the Civil Code, but no such intent
exists with respect to Section 14(1).

IV.

One of the keys to understanding the framework we set forth today is seeing how
our land registration procedures correlate with our law on prescription, which,
under the Civil Code, is one of the modes for acquiring ownership over property.

The Civil Code makes it clear that patrimonial property of the State may be
acquired by private persons through prescription. This is brought about by Article
1113, which states that [a]ll things which are within the commerce of man are
susceptible to prescription, and that [p]roperty of the State or any of its
subdivisions not patrimonial in character shall not be the object of prescription.

There are two modes of prescription through which immovables may be acquired
under the Civil Code. The first is ordinary acquisitive prescription, which, under
Article 1117, requires possession in good faith and with just title; and, under
Article 1134, is completed through possession of ten (10) years. There is nothing in
the Civil Code that bars a person from acquiring patrimonial property of the State
through ordinary acquisitive prescription, nor is there any apparent reason to
impose such a rule. At the same time, there are indispensable requisitesgood faith
and just title. The ascertainment of good faith involves the application of Articles
526, 527, and 528, as well as Article 1127 of the Civil Code,[45] provisions that
more or less speak for themselves.

On the other hand, the concept of just title requires some clarification. Under
Article 1129, there is just title for the purposes of prescription when the adverse
claimant came into possession of the property through one of the modes
recognized by law for the acquisition of ownership or other real rights, but the
grantor was not the owner or could not transmit any right. Dr. Tolentino explains:

Just title is an act which has for its purpose the transmission of ownership,
and which would have actually transferred ownership if the grantor had been the
owner. This vice or defect is the one cured by prescription. Examples: sale with
delivery, exchange, donation, succession, and dacion in payment.[46]
The OSG submits that the requirement of just title necessarily precludes the
applicability of ordinary acquisitive prescription to patrimonial property. The
major premise for the argument is that the State, as the owner and grantor, could
not transmit ownership to the possessor before the completion of the required
period of possession.[47] It is evident that the OSG erred when it assumed that the
grantor referred to in Article 1129 is the State. The grantor is the one from whom
the person invoking ordinary acquisitive prescription derived the title, whether by
sale, exchange, donation, succession or any other mode of the acquisition of
ownership or other real rights.

Earlier, we made it clear that, whether under ordinary prescription or

extraordinary prescription, the period of possession preceding the classification of
public dominion lands as patrimonial cannot be counted for the purpose of
computing prescription. But after the property has been become patrimonial, the
period of prescription begins to run in favor of the possessor. Once the requisite
period has been completed, two legal events ensue: (1) the patrimonial property
is ipso jure converted into private land; and (2) the person in possession for the
periods prescribed under the Civil Code acquires ownership of the property by
operation of the Civil Code.

It is evident that once the possessor automatically becomes the owner of the
converted patrimonial property, the ideal next step is the registration of the
property under the Torrens system. It should be remembered that registration of
property is not a mode of acquisition of ownership, but merely a mode of
confirmation of ownership.[48]

Looking back at the registration regime prior to the adoption of the Property
Registration Decree in 1977, it is apparent that the registration system then did not
fully accommodate the acquisition of ownership of patrimonial property under the
Civil Code. What the system accommodated was the confirmation of imperfect
title brought about by the completion of a period of possession ordained under the
Public Land Act (either 30 years following Rep. Act No. 1942, or since 12 June
1945 following P.D. No. 1073).

The Land Registration Act[49] was noticeably silent on the requisites for
alienable public lands acquired through ordinary prescription under the Civil Code,
though it arguably did not preclude such registration.[50] Still, the gap was
lamentable, considering that the Civil Code, by itself, establishes ownership over
the patrimonial property of persons who have completed the prescriptive periods
ordained therein. The gap was finally closed with the adoption of the Property
Registration Decree in 1977, with Section 14(2) thereof expressly authorizing
original registration in favor of persons who have acquired ownership over private
lands by prescription under the provisions of existing laws, that is, the Civil Code
as of now.

V.

We synthesize the doctrines laid down in this case, as follows:

(1) In connection with Section 14(1) of the Property Registration Decree, Section
48(b) of the Public Land Act recognizes and confirms that those who by
themselves or through their predecessors in interest have been in open, continuous,
exclusive, and notorious possession and occupation of alienable and disposable
lands of the public domain, under a bona fide claim of acquisition of ownership,
since June 12, 1945 have acquired ownership of, and registrable title to, such
lands based on the length and quality of their possession.

(a) Since Section 48(b) merely requires possession since 12 June 1945
and does not require that the lands should have been alienable and
disposable during the entire period of possession, the possessor is entitled to
secure judicial confirmation of his title thereto as soon as it is declared
alienable and disposable, subject to the timeframe imposed by Section 47 of
the Public Land Act.[51]

(b) The right to register granted under Section 48(b) of the Public
Land Act is further confirmed by Section 14(1) of the Property Registration
Decree.
(2) In complying with Section 14(2) of the Property Registration Decree, consider
that under the Civil Code, prescription is recognized as a mode of acquiring
ownership of patrimonial property. However, public domain lands become only
patrimonial property not only with a declaration that these are alienable or
disposable. There must also be an express government manifestation that the
property is already patrimonial or no longer retained for public service or the
development of national wealth, under Article 422 of the Civil Code. And only
when the property has become patrimonial can the prescriptive period for the
acquisition of property of the public dominion begin to run.

(a) Patrimonial property is private property of the government. The

person acquires ownership of patrimonial property by prescription under the
Civil Code is entitled to secure registration thereof under Section 14(2) of
the Property Registration Decree.

(b) There are two kinds of prescription by which patrimonial property

may be acquired, one ordinary and other extraordinary. Under ordinary
acquisitive prescription, a person acquires ownership of a patrimonial
property through possession for at least ten (10) years, in good faith and with
just title. Under extraordinary acquisitive prescription, a persons
uninterrupted adverse possession of patrimonial property for at least thirty
(30) years, regardless of good faith or just title, ripens into ownership.

B.

We now apply the above-stated doctrines to the case at bar.

It is clear that the evidence of petitioners is insufficient to establish that Malabanan

has acquired ownership over the subject property under Section 48(b) of the Public
Land Act. There is no substantive evidence to establish that Malabanan or
petitioners as his predecessors-in-interest have been in possession of the property
since 12 June 1945 or earlier. The earliest that petitioners can date back their
possession, according to their own evidencethe Tax Declarations they presented in
particularis to the year 1948. Thus, they cannot avail themselves of registration
under Section 14(1) of the Property Registration Decree.

Neither can petitioners properly invoke Section 14(2) as basis for registration.
While the subject property was declared as alienable or disposable in 1982, there is
no competent evidence that is no longer intended for public use service or for the
development of the national evidence, conformably with Article 422 of the Civil
Code. The classification of the subject property as alienable and disposable land of
the public domain does not change its status as property of the public dominion
under Article 420(2) of the Civil Code. Thus, it is insusceptible to acquisition by
prescription.

VI.

A final word. The Court is comfortable with the correctness of the legal
doctrines established in this decision. Nonetheless, discomfiture over the
implications of todays ruling cannot be discounted. For, every untitled property
that is occupied in the country will be affected by this ruling. The social
implications cannot be dismissed lightly, and the Court would be abdicating its
social responsibility to the Filipino people if we simply levied the law without
comment.

The informal settlement of public lands, whether declared alienable or not, is a

phenomenon tied to long-standing habit and cultural acquiescence, and is common
among the so-called Third World countries. This paradigm powerfully evokes the
disconnect between a legal system and the reality on the ground. The law so far has
been unable to bridge that gap. Alternative means of acquisition of these
public domain lands, such as through homestead or free patent, have

proven unattractive due to limitations imposed on the grantee in the encumbrance

or alienation of said properties.[52] Judicial confirmation of imperfect title has
emerged as the most viable, if not the most attractive means to regularize the
informal settlement of alienable or disposable lands of the public domain, yet even
that system, as revealed in this decision, has considerable limits.

There are millions upon millions of Filipinos who have individually or exclusively
held residential lands on which they have lived and raised their families. Many
more have tilled and made productive idle lands of the State with their hands. They
have been regarded for generation by their families and their communities as
common law owners. There is much to be said about the virtues of according them
legitimate states. Yet such virtues are not for the Court to translate into positive
law, as the law itself considered such lands as property of the public dominion.It
could only be up to Congress to set forth a new phase of land reform to sensibly
regularize and formalize the settlement of such lands which in legal theory are
lands of the public domain before the problem becomes insoluble. This could be
accomplished, to cite two examples, by liberalizing the standards for judicial
confirmation of imperfect title, or amending the Civil Code itself to ease the
requisites for the conversion of public dominion property into patrimonial.

Ones sense of security over land rights infuses into every aspect of well-
being not only of that individual, but also to the persons family. Once that sense of
security is deprived, life and livelihood are put on stasis. It is for the political
branches to bring welcome closure to the long pestering problem.
WHEREFORE, the Petition is DENIED. The Decision of the Court of Appeals
dated 23 February 2007 and Resolution dated 2 October 2007 are AFFIRMED.
No pronouncement as to costs.

SO ORDERED.
 [G.R. No. L-27873. November 29, 1983.]

HEIRS OF JOSE AMUNATEGUI, Petitioners, v. DIRECTOR OF FORESTRY, Respondent.

[G.R. No. L-30035. November 29, 1983.]

ROQUE BORRE and ENCARNACION DELFIN, Petitioners, v. ANGEL ALPASAN, HEIRS OF

MELQUIADES BORRE, EMETERIO BEREBER and HEIRS OF JOSE AMUNATEGUI and THE CAPIZ
COURT OF FIRST INSTANCE, Respondents.

SYLLABUS

1. CIVIL LAW; PUBLIC LAND ACT; FOREST LAND; CLASSIFICATION NOT LOST EVEN IF IT HAS BEEN
STRIPPED OF FOREST COVER; UNLESS RELEASED IN AN OFFICIAL PROCLAMATION AS DISPOSABLE LANDS,
RULES ON CONFIRMATION OF IMPERFECT TITLE DO NOT APPLY. — A forested area classified as forest land
of the public domain does not lose such classification simply because loggers or settlers may have stripped it
of its forest cover. Parcels of land classified as forest land may actually be covered with grass or planted to
crops by kaingin cultivators or other farmers. "Forest lands" do not have to be on mountains or in out of the
way places. Swampy areas covered by mangrove trees, nipa palms, and other tress growing in brackish or
sea water may also be classified as forest land. The classification is descriptive of its legal nature or status
and does not have to be descriptive of what the land actually looks like. Unless and until the land classified
as "forest" is released in an official proclamation to that effect so that it may form part of the disposable
agricultural lands of the public domain, the rules on confirmation of imperfect title do not apply.

2. ID.; ID.; FOREST LANDS; ACQUISITIVE OWNERSHIP NOT ACQUIRED. — This Court ruled in the leading
case of Director of Forestry v. Muñoz (23 SCRA 1184) that possession of forest lands, no matter how long,
cannot ripen into private ownership. And in Republic v. Animas (56 SCRA 499), we granted the petition on
the ground that the ares covered by the patent and title was not disposable public land, it being a part of
the forest zone and any patent and title to said area is void ab initio. It bears emphasizing that a positive act
of Government is needed to declassify land which is classified as forest and to convert it into alienable or
disposable land for agricultural or other purposes.

3. ID.; ID.; CONFIRMATION, OF IMPERFECT TITLE CASES; BURDEN OF PROVING THAT THE REQUIREMENTS
OF THE LAW HAVE BEEN MET, RESTS ON THE APPLICANT. — In confirmation of imperfect title cases, the
applicant shoulders the burden of proving that he meets the requirements of Section 48, Commonwealth Act
No. 141, as amended by Republic Act No. 1942. He must overcome the presumption that the land he is
applying for is part of the public domain but that he has an interest therein sufficient to warrant registration
in his name because of an imperfect title such as those derived from old Spanish grants or that he has had
continuous, open, and notorious possession and occupation of agricultural lands of the public domain under
a bona fide claim of acquisition of ownership for at least thirty (30) years preceding the filing of his
application.

DECISION

GUTIERREZ, JR., J.:

The two petitions for review on certiorari before us question the decision of the Court of Appeals which
declared the disputed property as forest land, not subject to titling in favor of private persons.

These two petitions have their genesis in an application for confirmation of imperfect title and its registration
filed with the Court of First Instance of Capiz. The parcel of land sought to be registered is known as Lot No.
885 of the Cadastral Survey of Pilar, Capiz, and has an area of 645,703 square meters. cralawna d

Roque Borre, petitioner in G.R. No, L-30035, and Melquiades Borre, filed the application for registration. In
due time, the heirs of Jose Amunategui, petitioners in G.R. No. L-27873 filed an opposition to the application
of Roque and Melquiades Borre. At the same time, they prayed that the title to a portion of Lot No. 885 of
Pilar Cadastre containing 527,747 square meters be confirmed and registered in the names of said Heirs of
Jose Amunategui.

The Director of Forestry, through the Provincial Fiscal of Capiz, also filed an opposition to the application for
registration of title claiming that the land was mangrove swamp which was still classified as forest land and
part of the public domain.

Another oppositor, Emeterio Bereber filed his opposition insofar as a portion of Lot No. 885 containing
117,956 square meters was concerned and prayed that title to said portion be confirmed and registered in
his name.

During the progress of the trial, applicant-petitioner Roque Borre sold whatever rights and interests he may
have on Lot No. 885 to Angel Alpasan. The latter also filed an opposition, claiming that he is entitled to have
said lot registered in his name.

After trial, the Court of First Instance of Capiz adjudicated 117,956 square meters to Emeterio Bereber and
the rest of the land containing 527,747 square meters was adjudicated in the proportion of 5/6 share to
Angel Alpasan and 1/6 share to Melquiades Borre.

Only the Heirs of Jose Amunategui and the Director of Forestry filed their respective appeals with the Court
of Appeals, The case was docketed as CA-G.R. No. 34190-R.

In its decision, the Court of Appeals held:jgc:cha nrob les.com .ph

". . . the conclusion so far must have to be that as to the private litigants that have been shown to have a
better right over Lot 885 are, as to the northeastern portion of a little less than 117,956 square meters, it
was Emeterio Bereber and as to the rest of 527,747 square meters, it was the heirs of Jose Amunategui; but
the last question that must have to be considered is whether after all, the title that these two (2) private
litigants have shown did not amount to a registerable one in view of the opposition and evidence of the
Director of Forestry; . . .

". . . turning back the clock thirty (30) years from 1955 when the application was filed which would place it
at 1925, the fact must have to be accepted that during that period, the land was a classified forest land so
much so that timber licenses had to be issued to certain licensee before 1926 and after that; that even Jose
Amunategui himself took the trouble to ask for a license to cut timber within the area; and this can only
mean that the Bureau of Forestry had stood and maintained its ground that it was a forest land as indeed
the testimonial evidence referred to above persuasively indicates, and the only time when the property was
converted into a fishpond was sometime after 1950; or a bare five (5) years before the filing of the
application; but only after there had been a previous warning by the District Forester that that could not be
done because it was classified as a public forest; so that having these in mind and remembering that even
under Republic Act 1942 which came into effect in 1957, two (2) years after this case had already been filed
in the lower Court, in order for applicant to be able to demonstrate a registerable title he must have shown.

"‘open, continuous, exclusive and notorious possession and occupation of agricultural lands of the public
domain under a bona fide claim of acquisition of ownership for at least thirty (30) years, preceding the filing
of the application;’

the foregoing details cannot but justify the conclusion that not one of the applicants or oppositors had
shown that during the required period of thirty (30) years prescribed by Republic Act 1942 in order for him
to have shown a registerable title for the entire period of thirty (30) years before filing of the application, he
had been in

"‘open, continuous, exclusive and notorious possession and occupation of agricultural lands of the public
domain’,

it is evident that the Bureau of Forestry had insisted on its claim all throughout that period of thirty (30)
years and even before and applicants and their predecessors had made implicit recognition of that; the
result must be to deny all these applications; this Court stating that it had felt impelled notwithstanding, just
the same to resolve the conflicting positions of the private litigants among themselves as to who of them
had demonstrated a better right to possess because this Court foresees that this litigation will go all the way
to the Supreme Court and it is always better that the findings be as complete as possible to enable the
Highest Court to pass final judgment;
"IN VIEW WHEREOF, the decision must have to be as it is hereby reversed; the application as well as all the
oppositions with the exception of that of the Director of Forestry which is hereby sustained are dismissed;
no more pronouncement as to costs." cralaw virtua1aw l ibra ry

A petition for review on certiorari was filed by the Heirs of Jose Amunategui contending that the disputed lot
had been in the possession of private persons for over thirty years and therefore in accordance with
Republic Act No. 1942, said lot could still be the subject of registration and confirmation of title in the name
of a private person in accordance with Act No. 496 known as the Land Registration Act. On the other hand,
another petition for review on certiorari was filed by Roque Borre and Encarnacion Delfin, contending that
the trial court committed grave abuse of discretion in dismissing their complaint against the Heirs of Jose
Amunategui. The Borre complaint was for the annulment of the deed of absolute sale of Lot No. 885
executed by them in favor of the Heirs of Amunategui. The complaint was dismissed on the basis of the
Court of Appeals’ decision that the disputed lot is part of the public domain. The petitioners also question the
jurisdiction of the Court of Appeals in passing upon the relative rights of the parties over the disputed lot
when its final decision after all is to declare said lot a part of the public domain classified as forest land.
chan robles law lib rary : re d

The need for resolving the questions raised by Roque Borre and Encarnacion Delfin in their petition depends
on the issue raised by the Heirs of Jose Amunategui, that is, whether or not Lot No. 885 is public forest land,
not capable of registration in the names of the private applicants.

The Heirs of Jose Amunategui maintain that Lot No. 885 cannot be classified as forest land because it is not
thickly forested but is a "mangrove swamp." Although conceding that a "mangrove swamp" is included in
the classification of forest land in accordance with Section 1820 of the Revised Administrative Code, the
petitioners argue that no big trees classified in Section 1821 of said Code as first, second and third groups
are found on the land in question. Furthermore, they contend that Lot 885, even if it is a mangrove swamp,
is still subject to land registration proceedings because the property had been in actual possession of private
persons for many years, and therefore, said land was already "private land" better adapted and more
valuable for agricultural than for forest purposes and not required by the public interests to be kept under
forest classification.

The petition is without merit.

A forested area classified as forest land of the public domain does not lose such classification simply because
loggers or settlers may have stripped it of its forest cover. Parcels of land classified as forest land may
actually be covered with grass or planted to crops by kaingin cultivators or other farmers. "Forest lands" do
not have to be on mountains or in out of the way places. Swampy areas covered by mangrove trees, nipa
palms, and other trees growing in brackish or sea water may also be classified as forest land. The
classification is descriptive of its legal nature or status and does not have to be descriptive of what the land
actually looks like. Unless and until the land classified as "forest" is released in an official proclamation to
that effect so that it may form part of the disposable agricultural lands of the public domain, the rules on
confirmation of imperfect title do not apply.

This Court ruled in the leading case of Director of Forestry v. Muñoz (23 SCRA 1184) that possession of
forest lands, no matter how long, cannot ripen into private ownership. And in Republic v. Animas (56 SCRA
499), we granted the petition on the ground that the area covered by the patent and title was not
disposable public land, it being a part of the forest zone and any patent and title to said area is void ab
initio. It bears emphasizing that a positive act of Government is needed to declassify land which is classified
as forest and to convert it into alienable or disposable land for agricultural or other purposes.

The findings of the Court of Appeals are particularly well-grounded in the instant petition.

The fact that no trees enumerated in Section 1821 of the Revised Administrative Code are found in Lot No.
885 does not divest such land of its being classified as forest land, much less as land of the public domain.
The appellate court found that in 1912, the land must have been a virgin forest as stated by Emeterio
Bereber’s witness Deogracias Gavacao, and that as late as 1926, it must have been a thickly forested area
as testified by Jaime Bertolde. The opposition of the Director of Forestry was strengthened by the appellate
court’s finding that timber licenses had to be issued to certain licensees and even Jose Amunategui himself
took the trouble to ask for a license to cut timber within the area. It was only sometime in 1950 that the
property was converted into fishpond but only after a previous warning from the District Forester that the
same could not be done because it was classified as "public forest." chan robles. com:c ralaw:red
In confirmation of imperfect title cases, the applicant shoulders the burden of proving that he meets the
requirements of Section 48, Commonwealth Act No. 141, as amended by Republic Act No. 1942. He must
overcome the presumption that the land he is applying for is part of the public domain but that he has an
interest therein sufficient to warrant registration in his name because of an imperfect title such as those
derived from old Spanish grants or that he has had continuous, open, and notorious possession and
occupation of agricultural lands of the public domain under a bona fide claim of acquisition of ownership for
at least thirty (30) years preceding the filing of his application.

The decision of the appellate court is not based merely on the presumptions implicit in Commonwealth Act
No. 141 as amended. The records show that Lot No. 88S never ceased to be classified as forest land of the
public domain.

In Republic v. Gonong (118 SCRA 729) we ruled: jgc:c hanro bles. com.ph

"As held in Oh Cho v. Director of Lands, 75 Phil. 890, all lands that were not acquired from the Government,
either by purchase or by grant, belong to the public domain. An exception to the rule would be any land that
should have been in the possession of an occupant and of his predecessors in-interests since time
immemorial, for such possession would justify the presumption that the land had never been part of the
public domain or that it had been a private property even before the Spanish conquest." cralaw virtua 1aw lib rary

In the instant petitions, the exception in the Oh Cho case does not apply. The evidence is clear that Lot No.
885 had always been public land classified as forest.

Similarly, in Republic v. Vera (120 SCRA 210), we ruled: jgc:chan roble s.com.p h

". . . The possession of public land however long the period thereof may have extended, never confers title
thereto upon the possessor because the statute of limitations with regard to public land does not operate
against the State, unless the occupant can prove possession and occupation of the same under claim of
ownership for the required number of years to constitute a grant from the State. (Director of Lands v.
Reyes, 68 SCRA 177, 195)." cralaw virtua 1aw lib rary

We, therefore, affirm the finding that the disputed property Lot No. 885 is part of the public domain,
classified as public forest land. There is no need for us to pass upon the other issues raised by petitioners
Roque Borre and Encarnacion Delfin, as such issues are rendered moot by this finding. chanro bles vi rtua l lawli bra ry

WHEREFORE, the petitions in G. R. No. L-30035 and G. R. No. L-27873 are DISMISSED for lack of merit.
Costs against the petitioners.
G.R. No. 75042 November 29, 1988

REPUBLIC OF THE PHILIPPINES, petitioner,

vs.
INTERMEDIATE APPELLATE COURT, ROMAN CATHOLIC BISHOP OF LUCENA, represented
by Msgr. Jose T. Sanchez, and REGIONAL TRIAL COURT, BRANCH LIII, LUCENA
CITY, respondents.

The Solicitor General for petitioner.

Gilbert D. Camaligan for private respondent.

BIDIN, J.:

This is an appeal from the 1) decision * of the FIRST CIVIL CASES DIVISION of the then Intermediate Appellate Court dated May 13, 1986,
in AC G.R. No. 01410 entitled the ROMAN CATHOLIC BISHOP OF Lucena, represented by Msgr. Jose T. Sanchez, applicant-appellee vs.
Republic of the Philippines, et al., Oppositors-appellants, affirming the decision ** of the then Court of FIRST INSTANCE of Quezon, 9th
Judicial District, Branch 1, dated November 4, 1980 in Land Registration Case No. N-1106 entitled the ROMAN CATHOLIC BISHOP of
Lucena, represented by Msgr. Jose T. Sanchez, applicant vs. the Director of Lands and the Director, Bureau of Forest Development,
oppositors, ordering the registration of title to the parcel of land designated, as lots 1, 2 and 3 of plan PSD-65686 and its technical
descriptions, and the parcel of land described in plan PSU-112592 and its technical description, together with whatever improvements
existing thereon, in the name of the ROMAN CATHOLIC BISHOP of Lucena and 2) its resolution Dated June 19,1986, denying appellant's
"Motion for Reconsideration for lack of merit."

The factual background of the case as found by the Intermediate Appellate Court are as follows:

On February 2, 1979, the ROMAN CATHOLIC BISHOP of Lucena, represented by

Msgr. Jose T. Sanchez, filed an application for confirmation of title to four (4) parcels
of land. Three of said parcels, denominated as Lots 1, 2 and 3, respectively, of plan
PSU-65686 are situated in Barrio Masin, Municipality of Candelaria, Quezon
Province. The fourth parcels under plan PSU-112592 is located in Barrio Bucal
(Taguan), same municipality and province. As basis for the application, the applicant
claimed title to the various properties through either purchase or donation dating as
far back as 1928.

The legal requirements of publication and posting were duly complied with, as was
the service of copies of notice of initial hearing on the proper government officials.

In behalf of the Director of Lands and the Director of the Bureau of Forest
Development, the Solicitor General filed an Opposition on April 20, 1979, alleging
therein among others, that the applicant did not have an imperfect title or title in fee
simple to the parcel of land being applied for.

At the initial hearing held on November 13, 1979, only the Provincial Fiscal in
representation of the Solicitor General appeared to interpose personal objection to
the application. Hence, an Order of General Default against the whole world was
issued by the Court a quo except for the Director of Lands and the Director of the
Bureau of Forest Development.

The preliminaries dispensed with, the applicant then introduced its proofs in support
of the petition, summed up by the lower court as follows:
 With respect to Lots 1, 2, and 3, plan PSU-65686.

Lots 1, 2 and 3 of plan PSU-65686 respectively containing an area of

18,977, 6,910 and 16,221 square meters, are adjoining lots & are
situated in the Barrio of Masin, Municipality of Candelaria, Province of
Quezon (formerly Tayabas) (Exhibits F, F-1, F-2 and F-3). Said lots
were surveyed for the Roman Catholic Church on November 3, 1928
(Exhibit P-5) and the survey plan approved on October 20, 1929
(Exhibit F-6).

Lot 1 was acquired by the Roman Catholic Church thru Rev. Father
Raymundo Esquenet by purchase from the spouses Atanacio Yranso
and Maria Coronado on October 20, 1928 (Exhibits G, G-1), portion
of Lot 2 also by purchase thru Rev. Father Raymundo Esquenet from
the spouses Benito Maramot and Venancia Descaller on May 22,
1969 (Exhibits M, N-1), while the remaining portion of Lot 2 and Lot 3
were already owned and possessed by the Roman Catholic Church
even prior to the survey of the said three lots in 1928.

Records of burial of the Roman Catholic Church of Candelaria,

Quezon showed that even as early as November 1918, Lot 3 has
already been utilized by the Roman Catholic Church as its cemetery
in Candelaria, Quezon (Exhibit N, N-1 to N-5). <äre||anº• 1àw>

These three lots presently constituted the Roman Catholic Church

cemetery in Candelaria, Quezon.

Lots 1, 2 and 3 are declared for taxation purposes in the name of the
Roman Catholic Church under Tax Declaration Nos. 22-19-02-079,
22-19-02-077 and 22-19-02-082 as 'cemetery site' (Exhibit S, V and
T).

With respect to the parcel of land described in plan PSU-112592:

This parcel of land situated in the barrio of Bucal (Taguan),

Municipality of Candelaria, Province of Quezon (formerly Tayabas)
and more particularly described in plan PSU-1 12592 and its
technical description with an area of 3,221 square meters (Exhibit 1)
was formerly owned and possessed by the spouses Paulo G.
Macasaet, and Gabriela V. de Macasaet. Said spouses, on February
26, 1941, donated this lot to the Roman Catholic Church represented
by Reverend Father Raymundo Esquenet (Exhibit J, J-1 to J-4). It
was surveyed for the Roman Catholic Church on Aug. 16, 1940 as
church site and the corresponding survey plan approved on Jan. 15,
1941 (Exhibits I-1, I-2, 1-3).

Previously erected on this Lot was an old chapel which was

demolished and new chapel now stands in its place on the same site.

For his part, the Fiscal in a Manifestation dated July 22, 1980, said 'the State will not
adduce evidence in support of its opposition and will submit the instant case for
decision.'
 Evaluating the applicant's submitted proofs, the court a quo concluded, on the basis
of acquisitive prescription at the very least, that the former had adequately shown
title to the parcels of land being claimed.

Since the acquisition of these four (4) lots by the applicant, it has
been in continuous possession and enjoyment thereof, and such
possession, together with its predecessors-in interest, covering a
period of more than 52 years (at least from the date of the survey in
1928) with respect to lots 1 and 2, about 62 years with respect to lot
3, all of plan PSU- 65686; and more than 39 years with respect to the
fourth parcel described in plan PSU-112592 (at least from the date of
the survey in 1940) have been open, public, continuous, peaceful,
adverse against the whole world, and in the concept of owner.

Accordingly, the court ordered the registration of the four parcels together with the
improvements thereon "in the name of the ROMAN CATHOLIC BISHOP OF
LUCENA, INC., a religious corporation sole duly registered and existing under the
laws of the Republic of the Philippines."

Against this decision, the Solicitor General filed a Motion for reconsideration on the
following grounds:

1. Article XIV, Section 11 of the New Constitution(1973) disqualifies a private

corporation from acquiring alienable lands for the public domain.

2. In the case at bar the application was filed after the effectivity on the New
Constitution on January 17, 1973.

which was denied by the lower court for lack of merit.

Still insisting of the alleged unconstitutionality of the registration (a point which,

incidentally, the appellant never raised in the lower court prior to its Motion for
Reconsideration), the Republic elevated this appeal. (Rollo, pp. 25-28)

On May 13, 1986, the first Civil Cases Division of the Intermediate Appellate Court rendered its
Decision the dispositive part of which reads:

WHEREFORE, finding the judgment a quo to be supported by law and the evidence
on record, the same is hereby AFFIRMED. No pronouncement as to costs.

SO ORDERED. (Rollo p. 30)

A reconsideration of the aforequoted Decision was sought by Appellant Republic of the Philippines,
but for lack of merit, its motion for reconsideration was denied on June 19, 1986, by Resolution of
the First Civil Case Division, Intermediate Appellate Court which resolution reads in full:

Considering appellant Republic of the Philippines "Motion for reconsideration" filed

on June 4, 1986; the Court RESOLVED to DENY the Motion for Reconsideration for
lack of merit, grounds raised therein having all been considered in the decision.
(Rollo, p. 31)
Hence, this petition.

The following are the assigned errors raised by the petitioner in its petition:

1. The decision and the resolution in question are contrary to law and decisions of
this honorable Court in Meralco vs. Castro-Bartolome and Republic, 114 SCRA 799
(prom. June 29,1982); Republic vs. Judge Villanueva and Iglesia ni Cristo, 114
SCRA 875, June 29, 1982); and Republic vs. Judge Gonong and Iglesia ni Cristo,
118 SCRA 729-733 (November 25,1982); Director of Lands vs. Hermanos y
Hermanas, Inc. 141 SCRA 21-25 (Jan. 7,1986).

2. The lands applied for registration were the subject of a previous registration case
where a decree of registration was already issued.

3. Respondent corporation failed to establish the indentity of the lands applied for.
(Rollo, pp. 14-15)

The issue raised in this case involves the question of whether the Roman Catholic Bishop of Lucena,
as a corporation sole is qualified to apply for confirmation of its title to the four (4) parcels of land
subject of this case.

Corollary thereto is the question of whether or not a corporation sole should be treated as an
ordinary private corporation, for purpose of the application of Art. XIV, Sec. 11 of the 1973
Constitution.

Article XIV, Sec. 11 of the 1973 Constitution, in part provides:

Sec. 11. .... No private corporation or association may hold alienable lands of the
public domain except by lease not to exceed one thousand hectares in area; nor may
any citizen hold such lands by lease in excess of five hundred hectares....

Sec. 48 of the Public Land Act, in part, provides:

Sec. 48. The following described citizens of the Philippines occupying lands of the
public domain or claiming to own any such lands or an interest therein, but whose
titles have not been perfected or completed, may apply to the Court of First Instance
of the province where the land is located for confirmation of their claims and the
issuance of a Certificate of title therefor, under the Land Registration Act, to wit:

(a) ...

(b) Those who by themselves or through their predecessor-in-interest

have been in open, continuous, exclusive, and notorious possession
and occupation of agricultural lands of the public domain under a
bona fide claim of acquisition of ownership for at least thirty years
immediately preceding the filing of the application for confirmation of
title except when prevented by war or force majeure. These shall be
conclusively presumed to have performed all the conditions essential
to a Government grant and shall be entitled to a certificate of title
under the provisions of this chapter.
 (c) ...

In its Motion for Reconsideration, petitioner contends that the Roman Catholic Bishop of Lucena
(private respondent herein) which is admittedly a corporation sole is disqualified to own and register
its title over the parcels of land involved herein. (Rollo, p. 41)

In its petition it likewise argued that being a juridical entity, private respondent cannot avail of the
benefits of Sec. 48(b) of the public land law which applies to FILIPINO citizens or NATURAL
persons. On the other hand, private respondent in its MEMORANDUM espoused the contrary view.

There is no merit in this petition.

The parties herein do not dispute that since the acquisition of the four (4) lots by the applicant, it has
been in continuous possession and enjoyment thereof, and such possession, together with its
predecessors-in-interest, covering a period of more than 52 years (at least from the date of survey in
1928) with respect to lots 1 and 2, about 62 years with respect to lot 3, all of plan PSU-65686; and
more than 39 years with respect to the fourth parcel described in plan PSU-11 2592 (at least from
the date of the survey in 1940) have been open, public, continuous, peaceful, adverse against the
whole world, and in the concept of owner.

Being disputed before this Court is the matter of the applicability of Art. XIV Sec. 11 of the 1973
Constitution to the case at bar.

Petitioner argues that considering such constitutional prohibition, private respondent is disqualified to
own and register its title to the lots in question. Further, it argues that since the application for
registration was filed only on February 2, 1979, long after the 1973 Constitution took effect on
January 17, 1973, the application for registration and confirmation of title is ineffectual because at
the time it was filed, private corporation had been declared ineligible to acquire alienable lands of the
public domain pursuant to Art. XIV, Sec. 11 of the said constitution. (Rollo, p. 41)

The questioned posed before this Court has been settled in the case of DIRECTOR OF LANDS vs.
Intermediate Appellate Court (146 SCRA 509 [1986]) which reversed the ruling first enunciated in
the 1982 case of Manila Electric Co. vs. CASTRO BARTOLOME, (114 SCRA 789 [1982]) imposing
the constitutional ban on public land acquisition by private corporations which ruling was declared
emphatically as res judicata on January 7, 1986 in Director of Lands vs. Hermanos y Hermanas de
Sta. Cruz de Mayo, Inc., (141 SCRA 21 [1986]). In said case, (Director of Lands v. IAC, supra), this
<äre|| anº•1àw>

Court stated that a determination of the character of the lands at the time of institution of the
registration proceedings must be made. If they were then still part of the public domain, it must be
answered in the negative.

If, on the other hand, they were already private lands, the constitutional prohibition against their
acquisition by private corporation or association obviously does not apply. In affirming the Decision
of the Intermediate Appellate Court in said case, this Court adopted the vigorous dissent of the then
Justice, later Chief Justice Claudio Teehankee, tracing the line of cases beginning with CARINO, 1 in
1909, thru SUSI, 2 in 1925, down to HERICO, 3 in 1980, which developed, affirmed and reaffirmed
the doctrine that open, exclusive and undisputed possession of alienable public land for the period
prescribed by law creates the legal fiction whereby the land, upon completion of the requisite
period ipso jure and without the need of judicial or other sanction, ceases to be public land and
becomes' private property. (DIRECTOR OF LANDS vs. IAC, supra, p. 518).

Nothing can more clearly demonstrate the logical inevitability of considering possession of public
land which is of the character and duration prescribed by statute as the equivalent of an express
grant from the state than the dictim of the statute itself; 4 that the possessor "... shall be conclusively
presumed to have performed all the conditions essential to a government grant and shall be entitled
to a certificate of title ..." No proof being admissable to overcome a conclusive presumption,
confirmation proceedings would, in truth be little more than a formality, at the most limited to
ascertaining whether the possession claimed is of the required character and length of time, and
registration thereunder would not confer title, but simply recognize a title already vested. The
proceedings would not ORIGINALLY convert the land from public to private land, but only confirm
such a conversion already effected by operation of law from the moment the required period of
possession became complete. As was so well put in Carino, "... There are indications that
registration was expected from all, but none sufficient to show that, for want of it, ownership actually
gained would be lost. The effect of the proof, wherever made, was not to confer title, but simply to
establish it, as already conferred by the decree, if not by earlier law. (DIRECTOR OF LANDS vs.
IAC, supra, p. 520).

The open, continuous and exclusive possession of the four lots by private respondent can clearly be
gleaned from the following facts on record: Lot 1 and portion of Lot 2 was acquired by purchase in
1928 and 1929, respectively. The remaining portion of lots 2 and 3 was already owned and
possessed by private respondent even prior to the survey of said lots in 1928. In fact, records of
burial of the Roman Catholic Church of Candelaria, Quezon showed that as early as 1919, Lot 3 has
already been utilized by the Roman Catholic Church as its cemetery. That at present, said three lots
are utilized as the Roman Catholic Church of Candelaria, Quezon. That said lots are declared for
taxation purposes in the name of the Roman Catholic Church. The fourth parcel of land was
acquired by donation in 1941 and same lot is utilized as church site.

It must be emphasized that the Court is not here saying that a corporation sole should be treated like
an ordinary private corporation.

In Roman Catholic Apostolic Administration of Davao, Inc. vs. Land Registration Commission, et al.
(L-8451, December 20,1957,102 Phil. 596). We articulated:

In solving the problem thus submitted to our consideration, We can say the following:
A corporation sole is a special form of corporation usually associated with the clergy.
Conceived and introduced into the common law by sheer necessity, this legal
creation which was referred to as "that unhappy freak of English Law" was designed
to facilitate the exercise of the functions of ownership carried on by the clerics for and
on behalf of the church which was regarded as the property owner (See 1 Bouvier's
Law Dictionary, p. 682-683).

A corporation sole consists of one person only, and his successors (who will always
be one at a time), in some particular station, who are incorporated by law in order to
give them some legal capacities and advantages, particulary that of perpetuity, which
in their natural persons they could not have had. In this sense, the King is a sole
corporation; so is a bishop, or deans distinct from their several chapters (Reid vs.
Barry, 93 fla. 849, 112 So. 846).

Pertinent to this case is the provision of Sec. 113 Batas Pambansa Blg. 68 which reads as follows:

Sec. 113. Acquisition and alienation of property. — Any corporation sole may
purchase and hold real estate and personal property for its church, charitable,
benevolent or educational purposes, and may receive bequests or gifts for such
purposes. Such corporation may mortgage or sell real property held by it upon
obtaining an order for that purpose from the Court of First Instance of the province
 where the property is situated; but before the order is issued, proof must be made to
the satisfaction of the Court that notice of the application for leave to mortgage or sell
has been given by publication or otherwise in such manner and for such time as said
court may have directed, and that it is to the interest of the corporation that leave to
mortgage or sell should be granted. The application for leave to mortgage or sell
must be made by petition, duly verified by the chief archbishop, bishop, priest,
minister, rabbi or presiding elder acting as corporation sole, and may be opposed by
any member of the religious denomination, sect or church represented by the
corporation sole: Provided, That in cases where the rules, regulations and discipline
of the religious denomination, sect or church religious society or order concerned
represented by such corporation sole regulate the method of acquiring, holding,
selling and mortgaging real estate and personal property, such rules, regulations and
discipline shall control and the intervention of the courts shall not be necessary.

There is no doubt that a corporation sole by the nature of its Incorporation is vested with the right to
purchase and hold real estate and personal property. It need not therefore be treated as an ordinary
private corporation because whether or not it be so treated as such, the Constitutional provision
involved will, nevertheless, be not applicable.

In the light of the facts obtaining in this case and the ruling of this Court in Director of Lands vs. IAC,
(supra, 513), the lands subject of this petition were already private property at the time the
application for confirmation of title was filed in 1979. There is therefore no cogent reason to disturb
the findings of the appellate court.

WHEREFORE, the petition is dismissed for lack of merit and the appealed decision and Resolution
of the Intermediate Appellate Court is hereby AFFIRMED.

SO ORDERED.
G.R. No. L-28021 December 15, 1977

JULIAN SANTULAN substituted by his children named PATROCINIO, ADORACION, ARTURO,

CONSTANCIA, and PEPITA, all surnamed SANTULAN and minor grandchildren, JOCELYN,
ROSAURO and ROBERTO, all surnamed SANTULAN assisted by their guardian ad
litem, PATROCINIO SANTULAN petitioners-appellants,
vs.
THE EXECUTIVE SECRETARY, THE SECRETARY OF AGRICULTURE AND NATURAL
RESOURCES, THE DIRECTOR OF LANDS, and ANTONIO LUSIN, substituted by his Heirs
named TEODOSIA BALANZA (widow) and Children LEOPOLDO, ARMANDO. ALFONSO,
EMILIANO, MAGDALENA, ERLINDA and ESTRELLA (ESTER), all surnamed LUSIN, and Heirs
of CAROLINA LUSIN-LUCERO named MANOLITO LUCERO and MARIO LUCERO, respondents-
appellees.

Isidoro Crisostomo for appellants Heirs of Julian Santulan.

Romulo C. Felizmeña for appellees Heirs of Antonio Lusin.

Solicitor General Arturo A. Alafriz Assistant Solicitor General Esmeraldo Umali and Solicitor Conrado
T. Limcaoco for The Executive Secretary, etc.

AQUINO, J.

This case is about the lease of a parcel of foreshore land of the public domain with an area of about
four and one-half hectares located at Barrio Kaingin, Kawit, Cavite abutting on Bacoor Bay and the
Ankaw Creek.

It is protracted controversy that has been pending for more than thirty years between the rival
claimants Julian Santulan plan and Antonio Lusin, who have been succeeded by their heirs.

Santulan claimed that foreshore land was an extension of his land, Lot No. 986 of the Kawit
cadastre, with an area of 17,301 square meters, registered in his name in 1937 under Original
Certificate of Title No. 6 which was issued by virtue of a free patent. The northern boundary of Lot
No. 986 is Bacoor (Manila) Bay (Exh. A). The said foreshore land was allegedly formed by soil
deposits accumulated by the alluvial action of the sea.

On December 5, 1942 Santulan caused the said land to be surveyed. The survey plan was approved
by the Director of Lands in 1944 (Exh. B). On December 29, 1942 Santulan, pursuant to Lands
Administrative Order No. 7-1, filed an application, F.L.A. No. V 562, to lease for five years for
agricultural purposes an area of 36,120 square meters of the said foreshore land (Exh. F).

On that same date, December 29, 1942, Santulan, pursuant to Act No. 3077 and Lands
Administrative Order No. 8-3, filed with the Bureau of Lands an application for a revocable permit to
occupy the said land. He indicated therein that he would use the land for 11 capiz beds and oyster
beds, the planting of bakawan and pagatpat and later to be developed into a fishpond" (Exh. G).

Seven years later, or on December 22, 1949, Santulan filed with the Bureau of Fisheries an
application for an ordinary fishpond permit or lease of the said foreshore land (Special Use Permit,
pp. A. No. 5114, Exh. H).
At the instance of the Director of Fisheries, the Director of Forestry investigated the condition of the
said foreshore land. The latter in his first indorsement dated June 19, 1950 found that it was swampy
"and not an improved fishpond as alleged by Antonio Lusin" and that it is within the disposable areas
for agricultural purposes under the jurisdiction of the Bureau of Lands (Exh. L-1).

The chief of the division of commercial fisheries sent a letter to Lusin dated April 28, 1950 apprising
him that he was reported to have illegally entered the area covered by Santulan's fishpond permit
application and directing him to refrain from introducing improvements, with the warning that court
proceedings would be taken against him (Exh. J).

On January 12, 1951 an attorney, acting for the Director of Lands wrote the following letter to Lusin
advising him to vacate the disputed land and maintain the status quo:

Mr. Antonio Lusin

Caiñgin, Kawit, Cavite

S i r:

We have been informed that the area which is presently controverted by and
between you and Julian Santulan, under the applications noted above, was recently
entered by you and some companion and that you are destroying the dikes and other
improvements previously constructed thereon by said Julian Santulan.

If this information is true, and inasmuch as you are aware that the controversy is still
pending final adjudgment in this Office, is desired that you take proper advice and
leave the area and its existing improvements in status quo in order to avoid possible
confusion of rights which ma delay the final disposition of the area in question.

You are advised further that the acts imputed to you may make you liable to
prosecution and punishment under the law; and that whatever improvements you
may make for yourself in the premises will not legally accrue to your benefit, nor will
they serve as basis for a claim to preferential rights. (Paragraphing supplied, Exh, J-
1).

Santulan declared the said foreshore land in his name for tax purposes. Tax Declaration No. 2923,
which took effect in 1948 and which cancelled Tax Declaration No. 13816 also in Santulan's name,
shows that the land was assessed at P460. He paid the realty taxes due on the said land for the
years 1945-46, 1948-55 and 195760 (Exh. C, D and E, el seq.).

On the other hand, Antonio Lusin in 1942 and 1945 (he died in 1962) filed with the Bureau of Lands
applications for a revocable-permit and lease of a foreshore land, respectively, for the purpose of
producing salt on the said land. He claimed that he had been in the continuous and exclusive
possession of the land since 1920, when it was still under water, and that he had used it as a site of
his fish corrals.

He allegedly converted two hectares of the said land into a fishpond. The entire area was enclosed
with mud dikes and provided with a concrete sluice gate and another sluice gate made of wood On
the northern part of the land bordering the bay were bamboo stakes placed at close intervals to
serve as water breakers to protect the mud dikes from being washed away by the action of the sea.
Lusin introduced the alleged improvements from 1951 to 1953.
The 1942 foreshore lease applications of Santulan and Lusin gave rise to Bureau of Lands Conflict
No. 8 (N). The Director of Lands in his decision in that case dated February 1, 1951 found that the
disputed land is foreshore land covered and uncovered by the flow and ebb of the ordinary tides that
it is an extension of Santulan's Lot No. 986 and it was formerly a part of the sea; that Santulan was
the first to enter the land and to make dikes thereon, and that Lusin entered the land later and made
dikes also (Exh. K made a part hereof for reference as Annex A).

The Director ruled that the disputed foreshore land was subject "to reparian rights which may he
invoked by Santulan as owner of the upland in accordance with section 32 of Lands Administrative
Order No. 7-1" (Exh. K). Hence the Director rejected Lusin's application for a foreshore lease and for
a revocable permit and gave due course to Santulan's foreshore lease application.

Lusin filed a motion for reconsideration. The Director in his order of October 19, 1951 denied that
motion. lie found that Lusin was a possessor in bad faith: that it is not true that Lusin had improved
and possessed the said foreshore land for twenty years, that the disputed area is covered by water,
two to three feet deep during ordinary tides and is exposed land after the ebb of the tides, and that
Lusin's alleged possession and improvements could not nullify Santulan's preferential right to lease
the land by reason of his riparian rights. The Director ordered Lusin to vacate the land within sixty
days from notice (Exh. L made a part hereof for reference as Annex B).

Lusin appealed to the Acting Secretary of Agriculture and Natural Resources who in his decision of
October 13, 1952 dismissed the appeal and affirmed the Director's 1951 decision (Exh. M made a
part hereof for reference as Annex C). Lusin's motion for reconsideration was denied in the
Secretary's order of February 28, 1953 (Exh. N made a part hereof for reference as Annex D).

Lusin asked for a reinvestigation of the case. His request was granted. The Department ordered a
reinvestigation on May 12, 1953.

After receipt of the report of reinvestigation, the Undersecretary of Agriculture and Natural
Resources, by authority of the Secretary, in his order of December 14, 1954, reaffirmed the rejection
of Lusin's revocable permit and foreshore lease applications but ordered Santulan to reimburse to
Lusin the appraised value of his improvements (Exh. O made a part hereof for reference as Annex
E).

Lusin appealed to the President of the Philippines after his motion for reconsideration was denied in
the Undersecretary's order of May 19, 1955 (Exh. OO made a part hereof for reference as Annex F).

Executive Secretary Juan C. Pajo, by authority of the President, held in his decision of April 10, 1958
that section 32 of Lands Administrative Order No. 7-1 (promulgated by the Secretary of Agriculture
and Natural Resources on April 30, 1936 pursuant to Acts Nos. 2874 and 3038) was "rendered
obsolete" by section 67 of the Public Land Law which took effect on December 1, 1936 (Exh. P
made a part hereof for reference as Annex G).

On the basis of the foregoing ruling and since the record is silent as to whether or not the land in
question has been declared by the President as not necessary for the public service and as open to
disposition (Sec. 61, Public Land Law), the Executive Secretary sustained Lusin's appeal and
reversed the orders of the Director of Lands and the Secretary of Agriculture and Natural Resources
in favor of Santulan. Secretary Pajo decided the case in the alternative as follows:

On the assumption that the land in question has been declared open for disposition
and is not necessary for the public service, this Office directs that an oral bidding for
the leasing thereof to interested parties pursuant to the provisions of Section 67 of
 Commonwealth Act .No. 141 be conducted and the contract of lease awarded to the
highest bidder whoever shall be the highest bidder, if other than the appellant, shall
be required to pay to the appellant the appraised value of the improvements
introduced by him on the land to be determined by that Department.

If the land in question has not been so declared, this Office directs that a revocable
permit under Section 68 of Commonwealth Act No. 141 be Id to the appellant
requiring him to pay permit fees since the year 1951.

Accordingly, the orders and decisions of that Department and the Bureau of Lands
are hereby revoked.

Santulan's case was distinguished from that of Gonzalo Monzon whose Lot No. 987 adjoins
Santulan's Lot No. 986. Executive Secretary Fred Ruiz Castro (now Chief Justice) in his decision of
May 10, 1954 upheld the preferential right of Monzon to lease the foreshore land north of his lot,
which foreshore land is adjacent to the foreshore land now in dispute in this case (Exh. Q made a
part hereof for reference as Annex H).

Santulan's motion for reconsideration was denied in the letter of the Acting Executive Secretary
dated August 20, 1959 (Exh. W).

On October 22, 1959 Santulan filed in the Court of First Instance of Cavite a petition for certiorari
wherein he alleged that the Executive Secretary committed a grave abuse of discretion in
misinterpreting certain provisions of Act No. 2874, Commonwealth Act No. 141, and Lands
Administrative Order No. 7-1.

In the lower court the parties agreed that the case Involves only a question of law. On August 18.
1961 the lower court dismissed the petition and affirmed the Executive Secretary's decision.
Santulan appealed to the Court of Appeals which in its resolution of July 21, 1967 elevated the
record to this Court on the ground that Santulan in his brief raised only the legal questions of
whether the Public Land Law repealed section 32 of Lands Administrative Order No. 7 1 and
whether the Executive Secretary's decision is "legally sound and correct" (CA-G. R. No. 30708-R).

It should be emphasized that. as found by tile investigators of the Bureau of Lands, Santulan was
the prior possessor of the foreshore land in question. lie had it surveyed in 1942. The survey plan
Psu-115357) was approved by the Director of Lands in 1944. Santulan paid the realty taxes on that
land .

It should further be underscored that the regulations pie him a preferential right to lease the land as
a riparian owner. Lands Administrative Order No. 7-1 dated April 30. 1936. which was issued by the
Secretary of Agriculture and Natural Resources upon the recommendation of the Director of Lands
for the disposition of alienable lands of the public domain, provides:

32. Preference of the Reparian Owner — The owner of the property adjoining
foreshore lands, marshy lands or lands covered with water bordering upon shores or
banks of navigable lakes or rivers, shall be given preference to apply for such lands
adjoining his property as may not be needed for the public service, subject to the
laws and regulations governing lands of this nature, provided that he applies therefor
within sixty (60) days from the date he receives a communication from the Director of
Lands advising him of his preferential right.
Paragraph 32 quoted above is a substantial copy of paragraph 4 of Lands Administrative Order No.
8-3 dated April 20, 1936, which was promulgated by the Secretary of Agriculture and Natural
Resources upon the recommendation of the Director of Lands for issuance of temporary permits of
occupation and use of agricultural lands of the public domain.

The word "riparian" in paragraphs 32 and 4 of the departmental regulations is used in a broad sense
as referring to any property having a water frontage (Shepard's Point Land Co. vs. Atlantic Hotel, 44
S. E. 39, 45, 132 N. C. 517, 65 C. J. S. 143, note 84). Strictly speaking, "riparian" refers to rivers. A
riparian owner is a person who owns land situated on the bank of a river.

But in paragraphs 32 and 4, the term "riparian owner" embraces not only the owners of lands on the
banks of rivers but also the littoral owners, meaning the owners of lands bordering the shore of the
sea or lake or other tidal waters. The littoral is the coastal region including both the land along the
coast and the water near the coast or the shore zone between the high and low watermarks.

Therefore, on the basis of paragraphs 32 and 4 of the said administrative regulations, Santulan or
his heirs Should be allowed to leased or occupy the said foreshore land.

But the Executive Secretary ruled that paragraph 32 was rendered obsolete by Commonwealth Act
No. 141 or, as held by the trial court, Lands Administrative Order No. 7-1 was repealed by the Public
Land Law. Is that conclusion correct? We hold that it is wrong.

It is true that Lands Administrative Orders Nos. 7-1 and 8-3 were issued when the 1919 Public Land
Act was in force or before the present Public Land Law took effect on December 1, 1936. But that
circumstance would not necessarily mean that the said departmental regulations are not good under
the 1936 Public Land Law.

In rationalizing the alleged repeal of paragraph 32, the Executive Secretary cited the following
provisions of Act No. 2874, the 1919 Public Land Act (15 Public Land laws 24):

SEC. 64. The lease or sale shall be adjudicated to the highest bidder; and if there is
no bidder besides the applicant, it shall be adjudicated to him. The provisions of
section twenty-seven of this Act shall be applied wherever applicable. If all or part of
the lots remain unleased or unsold the Director of Lands Shall from time to time
announce in the Offcial Gazette or otherwise the lease or sale of those lots if
necessary . (Section 27 refers to sealed bidding).

The Executive Secretary held that the above-quoted section 64 was by the for provisions of on
wealth Act No. 141 which took effect on December 1, 1936:

SEC. 67. The lease or sale shall be made through oral bidding-, and ajudication shall
be made to the highest bidder. However, where m applicant has made improvements
on the land by virtue of a permit issued to him by competent authority, the sale or
lease shall be made by sealed bidding as prescribed in section twenty-six of this Act,
the provisions of which shall be applied wherever applicable. If all or Dart of the lots
remain unleased or unsold. the Director of Lands shall from time to time announce in
the Official Gazzate, or in any other newspapers of general circulation, the lease or
sale of those lots, if necessary. (Section 26, like section 27 of Act No. 2874, refers to
sealed bidding).
The Executive Secretary noted that under section 64 of Act No. 2874 sealed bidding was the general
rule of procedure in an award of a lease of foreshore land and that the t is entitled to equal the bid of
the highest bidder. On the other hand, under 67, oral bidding is the general rule.

Hence, the Executive Secretary assumed that, while under section 64 of the 1919 old Public Land
Act, the fact that the applicant has a preferential right to lease foreshore land was a crucial factor it is
thus under section 67 of the 1936 Public Land Law because in oral bidding the appellant is not
entitled to equal the bid of the highest bidder.

The Executive Secretary concluded that, because the preferential right of the applicant to lease
foreshore land was immaterial under 67 of the present Public Land Law, paragraph 32 of Lands
Administrative Order No. 7-1, which gives such preference. had become "idle and useless".

That conclusion is wrong because it is based on the erroneous hypothesis that section 64 of the
1919 Public Land Act is different from section 67 of the 1936 Public Land Law. They are not
different. The truth is that section 64 was amended by Act No. 3517 which took effect on February 4,
1919 (24 Public Laws 416). Section 64, as thus amended, is substantially the same as section 67 of
the 1936 Public Land Law.

That fact was overlooked by the Executive Secretary. Hence, his conclusion, that paragraph 32 of
Lands Administrative Order No. 71 was repealed or rendered obsolete by section 67 of the present
Public Land Law, is wrong because its premise is wrong.

In other words, paragraph 32 of Lands Administrative Order No. 7-1, issued on April 30, 1936, was
promulgated under section 64 of the old Public Land Law, as amended. And since the amended
section 64 was substantially reproduced in section 67 of the 1936 Public Land Law, it is glaringly
incorrect to say that section 67 rendered obsolete the said paragraph 32. Paragraph 32 is still in
force and is good under the existing Public Land Law.

The foregoing discussion reveals that the Executive Summary's rationalization of the alleged repeal
of paragraph 32 of Lands Administrative Order No. 7-1 (identical to paragraph 4 of Lands
Administrative Order No. 8-3) is not only deficient in clarity and cogency but is predicated on the
false assumption that section 64 of the 1919 Public Land Act is different from section 67 of the
present Public Land Law. Consequently, the aforementioned decision of Executive Secretary Juan
C. Pajo under review bas to be set aside.

This case is governed by the precedent established in the case of Gonzalo Monzon, which, as
already noted, is similar to this cm since the foreshore land involved in the Monzon case is adjacent
to the foreshore land involved in this case.

In the Monzon case, the Office of the President, applying the oft-cited paragraph 32 of Lands
Administrative Order No. 7-1 held that Monzon, the littoral owner of the registered land abutting upon
the foreshore land, has the preferential right to lease the foreshore land,

The location of the lots of Santulan and Monzon and the foreshore lands abutting thereon is shown
in the following sketch bawd on the plan, Psu-115357 (Exh. B):

Manila Bay or Bacoor Bay

Disputed Area
Psu-1 15357 Psu- 1 15358
Foreshore land Forshore land
claimed by leased to
Julian Santulan Gonzalo Monzon
and
Antonio Lusin
Lot No. 986 Lot no. 987
Belonging to Belonging to
Julian Santulan Gonzalo Monzon

Considering that the foreshore land abutting upon Santolan's lot is in the same situation as the
foreshore land abutting upon Monzon's lot, there is no reason why Santulan should not enjoy, with
respect to the disputed foreshore land, the rights given to Monzon over the foreshore land adjacent
to his lot.

Now, then, is there any justification for giving to the littoral owner the preferential right to lease the
foreshore land abutting on his land?

That rule in paragraph 32 is in consonance with article 4 of the Spanish Law of Waters of 1866
which provides that, while lands added to the shores by accretions and alluvial deposits caused by
the action of the sea form part of the public domain, such lands, "when they are no longer washed by
the waters of the sea and are not necessary for purposes of public utility, or for the establishment of
special industries, or for the coast guard service", shall be declared by the Government "to be the
property of the owner of the estates adjacent thereto and as increment thereof" (cited in Ignacio vs.
Director of Lands, 108 Phil. 335, 338).

In other words, article 4 recognizes the preferential right of the littoral owner (riparian according to
paragraph 32) to the foreshore land formed by accretions or alluvial deposits due to the action of the
sea (Ker & Co. vs. Cauden 6 Phil. 732, 736, 223 U.S. 268, 56 L. Ed. 432, 435; Jover vs. Insular
Government, 10 Phil. 522, 40 Phil. 1094, 1100, 221 U.S. 623, 55 L. Ed. 884).

The reason for that preferential right is the same as the justification for giving accretions to the
riparian owner, which is that accretion compensates the riparian owner for the diminutions which his
land suffers by reason of the destructive force of the waters (Cortes vs. City of Manila, 10 Phil. 567).
So, in the case of littoral lands, he who loses by the encroachments of the sea should gain by its
recession (Banks vs. Ogden 2 Wall. 57, 67, 17 L. Ed. 818, 821).

That preferential right is recognized in American jurisprudence where the rule is that the owner of the
land adjacent to navigable waters has certain riparian or littoral rights of a proprietary nature not
possessed by the general public which rights are incident to the ownership of the banks or the
uplands: riparian as respects the waters of a river and littoral as to sea waters or the waters of a lake
(65 C.J. S. 143-145).

It may be mentioned that the Director of Lands stated in his manifestation of October 26, 1977 that
Lands Administrative Orders Nos. 7-1 and 8-3 are still in force and have not been superseded by
any later regulations and that the directive of the President of the Philippines to the Director of Lands
dated May 24, 1966, stopping the grant of foreshore leases all along Manila Bay, towards Cavite and
Bataan, has not rendered the instant case moot and academic "because the foreshore lease
application involved is pending award."

In view of the foregoing considerations, the trial court's decision and the decision of the Executive
Secretary dated April 10, 1958 are reversed and set aside and the order of the Undersecretary of
Agriculture and Natural Resources dated December 14, 1954 and the orders of the Director of Lands
dated February I and October 19, 1951 are affirmed.

The lease application of Julian Santulan mentioned in the order of February 1, 1951 should be
recorded in the names of his heirs and the obligation to make reimbursement mentioned in the
dispositive part of the Undersecretary's order should now devolve upon the heirs of Santolan. The
reimbursement should be made to the heirs of the late Antonio Lusin The obligation to vacate the
disputed land, as required in the Director's order of October 19, 1951 devolves upon the heirs of
Lusin Costs in both instances against respondent heirs of Lusin (As amended by Resolution of
February 17, 1977.

SO ORDERED.

Barredo (Actg. Chairman), Antonio, Concepcion Jr. and Guerrero, JJ., concur.

Guerrero, J., was designated to sit in the Second Division.

Fernando and Santos, JJ., are on leave.

Annexes to Opinion in L-28021, Julian Santolan

vs. Executive , et al.

F. L. A. No. V-562, R. P. A. (New). Julian Santolan, Applicant & Contestant vs. F. L. A. (New), R. P.
A. (New), B. L. Conflict No. 8 (N) Psu- 1 15357, Kawit, Cavite.

Julian Santolan, Applicant-Appellant vs. Antonio Lusin, Applicant-Appellant, D.A.N.R.

Case No. 625, Psu- 1 15357, Kawit, Cavite.

Annex A — Order of Director of Lands dated February 1, 1951.

Annex B — Order of Director of Lands dated October 19, 1951.

Annex C — Decision of Acting Secretary of Agriculture and Natural Resources dated October 13,
1952.

Annex D — Order of Secretary of Agriculture and Natural Resources dated February 28,1953.

Annex E — Order of Undersecretary of Agriculture and Natural Resource dated December 14, 1954.

Annex F — Order of Undersecretary of Agriculture and Natural Resources dated May 19, 1955.

Annex G — Decision of Executive Secretary Juan C. Pajo dated April 10, 1958.
Annex H — Decision of Executive Secretary Fred Ruiz Castro dated -May 10, 1954 in Emiliano del
Rosario vs. Gonzalo Monzon.

ANNEX A

ORDER

Julian Santolan, who owns Lot No. 986 of the Kawit Cadastre, under a free patent grant with Original
Certificate of Title No. 6 issued to him on June 9, 1937, claims preferential rights to all the areas
extending seaward from the said lot. He caused the said areas to be surveyed for him in 1942, and
the survey plan thereof was approved in 1944, as may be seen in the Survey Plan Psu-115357 of
this Office which is reproduced in the sketch drawn. on the back of the last page hereof. Except the
portion marked "A" in the sketch, he made a foreshore lease application and a revocable permit
application for these areas in 1942 to devote the areas applied for to fishpond purposes. Presently,
he now includes the portion "A" in his applications herein mentioned to be devoted to the same
purposes — in fact, he now intends to utilize the entire area comprised in his Survey Psu-115357 for
fishery purposes and has filed therefor with the Bureau of Fisheries fishpond permit application No.
5114. Upon this claim he contests the revocable permit (new) application and the foreshore lease
(new) application for the portion O these mm marked "X" in the sketch which were filed by Antonio
Lusin in 1942 and 1945, respectively, for salt-producing purposes.

Lot No. 986 of the Kawit Cadastre, mentioned above as owned by Julian Santolan, a to be bounded
on the north by the Bacoor Bay. It is evident therefore that the areas now in Santolan's Survey Psu-
115357, were formerly parts of the bay, and that presently they exist as a result of the of the waters
of the sea. Investigation disclosed that these areas are now foreshore lands, — covered and
uncovered by the flow and ebb of the tides. Santolan was found to have entered the areas first and
made dikes Lusin was found to have entered lately and made does also. None of them, however,
has obtained from this Office any permit of occupancy and use, and their applications are not yet
approved.

On the basis alone of actual occupancy or introduction of improvements neither of the parties here
may claim preferential rights, for under the law and regulations, it is only such occupancy and
introduction of improvements as are made upon the authority of an official permit issued by this
Office which could serve as a reason for holding a sealed bidding in a public auction of the right to
low at which the permittee is given the preferred right to equal the highest bid that might be put by
any other party. This is the rule prescribed by Section 67 of Commonwealth Act No. 141 (the Public
land Act)' It appears, however, that the areas — portions "A", "X" and the parts extending up to the
Bar Bay now, as may be seen in the sketch, — which are comprised by Santolan's Survey Plan -
Psu-115357, are immediately adjoining Lot No. 986, which is his private property, and are
extensions of the said lot to the sea. The areas, being foreshore lands, are therefore subject to
riparian fights which may be invoked by Santolan as owner of the upland in accordance With Section
32 of lands Administrative Order No. 7-1 which provides the following:

Sec. 32. The owner of the property adjoining foreshore lands, marshy lands, or lands
covered with water bordering upon the shores or banks of navigable lakes or rivers,
shall be given preference to apply for such lands adjoining his property as may not
be needed for the public service, subject to the laws and regulations governing lands
of this nature, provided that he applies therefor within 60 days from the date he
receives a communication from the Director of Lands advising him of his preferential
right
As Julian Santolan is interested in utilizing the entire area covered by his Survey Psu- 1 15357 over
which he is fully entitled to exercise his riparian rights, the above-noted foreshore lease (new)
application and revocable (new) application of Antonio Lusin, both covering the portion marked "X" in
the sketch, are hereby rejected. The lease application of Santolan, shall be recorded as Foreshore
Urn Application No. 562 and given due course for the whole area (including portion "A) shown in the
said sketch.

SO ORDERED.

Manila, Philippines, February 1, 1951.

JOSE P. DANS
Director of Lands

ANNEX B

ORDER

Counsel for respondent Antonio Lusin has filed in due time a motion for the reconsideration
of our Order of February 1, 1951, which resolved this case in favor of contestant Julian
Santolan, praying that the said order be set aside and the case, reopened for purposes of a
formal hearing for the submission of evidence. Substantially stated, respondent Lusin claims
that he is entitled to preference because he has been in possession of the premises for a
period of over twenty years, placing stakes and planting aquatic trees for the raising and
cultivation of shell fish and sea shells, besides constructing dikes for pending fish and
making salt beds, — all these works undertaken by him being the cause for the gradual filling
of the area and its conversion into a productive state. He contends that the areas under
question had been formed thru "artificial accretion" caused by his own labor and,
consequently, he has the right of pre-emption.

There is no question, however, that the areas under question are parts of the foreshore.
Under Section 61 of Commonwealth Act No. 141 (Public Land Act), they are disposable to
private parties by k only and not otherwise; and under Section 67 of the same Act, the lease
shall be made thru oral bidding, the adjudication to be made to the highest bidder.

There is no question also that the areas under question extend to the sea from lot No. 986 of
the Kawit Cadastre, which is actually owned by respondent Santolan under Original
Certificate of Title No. 6 of the land records of Cavite. Undoubtedly, respondent has riparian
rights to the foreshore in question which he can invoke against contestant Lusin under the
provisions of Section 32 of Lands Administrative Order No. 7-1, quoted in toto in the order
sought to be reconsidered.

Records show that the areas under question are also involved in the Fishpond Application
No. 5114 of Julian Santolan with the Bureau of Fisheries which is also contested by Antonio.
lt appears that upon request of the Director of Fisheries to the Bureau of Forestry for
certification as to the availability of the areas for fishery purposes, the latter made
investigation, inquiring at the same time into the claim of Antonio Lusin, made formally in
writing, that he has improved the areas into a fishpond and has been in occupation thereof
for more than 20 years. The Bureau of Forestry made the findings that those areas are within
the disposable areas for agricultural purposes under the jurisdiction of the Bureau of Lands;
and that they are swampy lands, formerly under sea water of the Bacoor Bay, "and not an
improved fishpond as alleged by Antonio Lusin". These findings were transmitted to the
Director of Fisheries under first indorsement dated June 19, 1950.

Our own investigating officer, reporting on this case on January 25, 1951, stated the
following: "On December 15, 1950, when I conducted the first ocular inspection of the
premises in the presence of both parties, the only visible improvements found thereon are
the newly-constructed dikes made thereon by Julian Santolan, a few bacauan and ape-ape
trees of about two to three years old, bamboo stakes placed thereon at intervals, and a small
old hut located at almost the middle of the land in question. All these improvements were
claimed to have been introduced by Julian Santolan. Antonio Lusin, however, claimed that
those bamboo stakes found therein were his."

It is evident from the findings of both the inspecting officer of the Bureau of Forestry and our
own investigating officer that the areas under question are foreshore lands, and that they
have not been really improved and possessed by respondent Lusin for over twenty years as
he alleged. The improvements found therein have been recently made, and they are not of
such nature and extent as would have changed the character of the areas as foreshore. In
fact, according to the investigating officer, the areas have been seen by him on different
occasions, and he found that the same, as well as the neighboring areas in the same belt,
were covered by tidal waters of from 2 to 3 feet deep during ordinary rise of the tides, and
uncovered by the tides at ebb.

There is, therefore, no reason for changing our disposition in our order of February 1, 1951.
It is not necessary to re-open the case to receive evidence on respondent's allegation that he
has been in possession of the premises for over 20 years and has gradually improved them
because, aside from the fact that the allegation is belied by the physical condition of the
premises, whatever evidence may be gathered on that allegation could not change the
nature of the areas as foreshore, nor would it avoid the rights of contestant as riparian
owner. The presence of the respondent in the premises has not been authorize by
competent authorities, and his introduction of improvements thereon was not done with
proper permit of temporary occupancy and -use such as is prescribed in our administrative
practice. The circumstances under which he made improvements cannot justify his claim for
a preferred right under Section 67 of the Public Land Act; on the contrary, he stands to forfeit
the improvements to the Government for, as reported by our investigating officer, he entered
the Premises and commenced making the improvements after contestant Santolan himself
has already made improvements, and after he has been warned on December 15, 1950 by
the investigating officer not to continue working, which warning was confirmed by us in our
letter to him of January 12, 1951. His bad faith is quite evident, and he cannot avail of his
presence in the premises now to demand the issuance to him of a provisional or revocable
permit of temporary occupancy and use under our rules and regulations in order to legal his
entry and give validity to his improvements. The right to demand issuance of such a permit is
concomittant to the right of contestant Santolan to be a preferred applicant by virtue of his
riparian right recognized in Section 32 of Lands Administrative Order No. 7-1 cited
hereinabove.

IN VIEW HEREOF, the instant motion for reconsideration and reinvestigation of respondent
Antonio Lusin is hereby denied, and he shall vacate the premises within 60 days from receipt
of notice hereof.

SO ORDERED.
 Manila, Philippines, October 19, 1951.

JOSE P. DANS
Director of Lands

ANNEX C

DECISION

The order of the Director of Lands dated February 1, 1951, rejected Foreshore Lease Application
(New) and Revocable Permit Application (New) of Antonio Lusin and gave due course to the
Foreshore Lease Application No. 562 of Julian Santolan. Antonio Lusin claims that the order is
against the fact and the law. He presented three (3) motions for reconsideration: one on October 19,
1951; the other on December 12, 1951; and the last on April 9, 1952. Said motions were all denied.
Hence, the present appeal. The subject of contention is the strip of land having an area of 41/2
hectares from Lot No. 986 of the Kawit Cadastre No. 203 to the waters of Bacoor Bay. Lot No. 986 is
covered by I Certificate of Title No. 6 issued to Julian Santolan on June 9, 1937. Santolan's titled
property is bounded on the north by Bacoor Bay.

On December 5, 1942, Santolan filed his foreclosure km application for the entire tract entervening
between his property and Bacoor Bay. So he caused Psu- 115357 to be executed and same was
approved in 1944 by the Director of Lands.

On November 26, 1945, Antonio Lusin applied for permit for an area of 4.5 for salt bed purposes.
The area for which permit was asked is by his F.L.A. (New) filed on November 17, 1945, the
boundaries of which are as follows:

NE — V. del Rosario and E. del Rosario

SE — Julian Santolan

SW — Ankaw River

NW — Bacoor Bay

The two applications of Santolan and Lusin cover the same area. Julian Santolan duly protested in
1946 against Lusin's application. The question to be decided in this appeal is: Which of the two
applicants, Julian Santolan or Antonio Lusin, has right of preference to the land in controversy?

By virtue of the fact that he is a riparian owner, Julian Santolan has the right of preference pursuant
to the provisions of Section 32 Of Administrative Order No. 7-1, which reads as follows:

Sec. 32. The owner of the property adjoining foreshore lands, marshy lands, or hinds
covered with water bordering upon the shores or banks of navigable lakes or rivers,
shall be given preference to apply for such lands adjoining his property as may not
be needed for the public service, subject in the laws and regulations governing lands
of this nature, provided that he applies therefor within sixty (60) days from the date
he receives communication from the Director of Lands advising him of his
preferential right.
It is true that appellant Lusin introduced improvements on the in question, but that fact does not give
him preferential right , not only because he had not acquired any permit from the Bureau of Lands
before doing so, but also because his entry on the was duly protested by Santolan.

IN VIEW OF ALL THE FOREGOING, and finding that the order of the Director of lands on Feb. 1,
1951, is in accordance with the facts of record and the provisions of the law on the matter, the herein
appeal from said order should be, as hereby it is, dismissed.

SO ORDERED.

Manila, Philippines, October 13, 1952.

JOSE S. CAMUS
Acting Secretary of Agriculture
and Natural Resources

ANNEX D

ORDER

This is a motion filed by Antonio Lusin, thru counsel, for the reconsideration of the decision of this
Office dated October 13, 1952, dismissing his appeal from the decision of the Director of Lands
under date of February 1, 1951.

In support of the said motion for reconsideration, Lusin substantially alleges that he has been
improving the land in question since 1920, spending for such improvements no more than
P20,000.00, and for that reason, he should be given the preferential right to acquire the said land. To
reinforce his allegation, movant cites the case of Rosalia Vida Vda. de Tirona vs. Magdaleno
Tragico, CA G.R. No. 9050, decided by the Court of Appeals on June 30, 1943, wherein it was held
that because Tragico has constructed fishpond on a portion of the land in question by means of the
improvements he has introduced thereon and has possessed the land for sufficient time to acquire
the land by right of prescription, he was awarded the land in dispute.

We have found this allegation of movant to be far from the truth. lt is the finding of the investigating
officer who made an investigation of this case that it is Julian Santolan and not movant Lusin who
has been actually occupying the land in question and introducing improvements thereon. The
pertinent portion of his M reads as follows:

On December 16, 1950,, when I conducted the first ocular inspection of the premises
in the presence of both parties, the only visible improvements found thereon were the
newly constructed dikes made thereon by Julius Santolan, a few bacauan and ape-
ape trees of about two to three years old, bamboo stakes placed thereon at intervals
and a small old hut located at almost the middle of the land in question. All these
improvements were claimed to have been introduced thereon by Julian Santolan.
Antonio Lusin, however, claimed that the bamboo stakes found thereon were his.

Moreover, according to the further finding of the said investigating officer, the WW in question fails
under the category of foreshore land. That portion of his report referring to this finding is hereby
quoted as follows:
 It may not be amiss to state in this connection that I have. or different occassions, the
opportunity to inspect the land subject hereof on both high and low tides. During
ordinary low tide, the whole area. and further seaward, is entirely ex to the surface
while during ordinary high tide, it is wholly covered with tidal water with an
approximate depth of two to three feet. The land in question in its entirety is marshy
covered and uncovered by the ebb and flow of tidal water.

As the land is a foreshore land, the same is susceptible to the riparian right of the owner of the
adjoining land. According to Section 32 of Lands Administrative Order No. 7-1, the owner of the
property adjoining foreshore land, shall be given preference to apply for such land adjoining his
property as may not be needed for the public service. Inasmuch as the land in question adjoins Lot
No. 980, Kawit Cadastre, which is a private property of Julian Santolan, said Julian Santolan shall
have the preference right to apply therefor over and above any other applicant. It may be mentioned,
in this connection, that the said case of Rosalia Vida Vda. de Tirona vs. Magdaleno Tragicowho had
and improved the land claimed by him, it is Santolan and riot movant Lusin who has been actually
occupying and improving the land subject of the present controversy.

WHEREFORE, the instant motion for reconsideration filed by Antonio Lusin, as well as his request
for reinvestigation of this case, should be, as hereby it is, denied.

SO ORDERED.

Manila, Philippines, February 28,1953.

FERNANDO LOPEZ
Secretary of Agriculture and
Natural Resources

ANNEX E

ORDER

On October 13, 1952, the Office a in connection with the above-case can, the dispositive portion of
which reads as follows:

In view of all the foregoing and that the order of the Director of Lands on February 1,
1961, is in with the facts of record and the provisions of law on the matter the herein
appeal from the said order should be, as hereby it is dismissed.

From the said decision Antonio Lusin filed a motion for reconsideration which was denied as per
order of this Office dated February 28, 1953. Still not satisfied with the aforementioned order, Lusin
again filed a second notion for reconsideration predicating his motion on the following grounds:

1. That he (Lusin) is in actual ion of the land in question since 1920;

2. That said area is an agricultural land actually devoted to fishpond and, therefore, is not a
foreshore land;
3. That even granting without admitting that Santolan is a riparian owner, Santolan had lost his
riparian right thereto in view of the continuous ion by Lusin of the area since 1920; and

4. That in the investigation relied upon by the Director of Lands in his decision and confirmed by this
Office, the movant herein was not given opportunity to be heard because the said investigation was
never completed, and as a result, the conclusions of the investigator thereat were one sided

Adhering to its Policy of giving party litigants the outmost opportunity to present their respective
sides of the case, this Office ordered a reinvestigation of the case to determine whether or not the
allegations of Antonio Lusin are true.

From the said reinvestigation, the facts of this case may be stated as follows:

The disputed area is a strip of land containing an approximate area of 4-1/2 hectares located at the
Barrio of Kaingin, Municipality of Kawit, Province of Cavite- lt is bounded on the North by Bacoor
Bay, on the East by the property occupied by Vicente del Rosario and E. del Rosario, on the South
by Lot No. 896 of Kawit Cadastre No. 203; and on the West by Ankaw River. Lot 986, mentioned
above as the boundary of the area in question on the South, is owned and possessed by Julian
Santolan, his ownership thereof being evidenced by a free patent grant with Original Certificate of
Title No. 6 issued on June 9, 1937. The only issue to be resolved in this case is whether or not
Julian Santolan, as riparian owner, is entitled to the preference provided for in Section 32, Lands
Administrative Order No. 7-1, which reads as follows:

32. Preference of Riparian Owner.— The owner of the property adjoining foreshore
lands, marshy lands, or lands covered with water bordering upon the shores or banks
of navigable lakes or rivers, shall be given preference to apply or such lands
adjoining his property as may not be needed for the public service, subject to the
laws and regulations governing Ian of this nature, provided that he applies therefor
within sixty (60) days from the date he receives a communication from the Director of
Lands advising him of his preferential right.

During the reinvestigation of this case by a representative of this Office, it was disclosed that Antonio
Lusin is the actual occupant of the area in question - his present possession thereof dating back as
of 1951. During his occupation, Lusin has introduced considerable improvements in the area
investing his fife sa therein. Today, a portion of approximately two hectares of the said area is a
complete fishpond surrounded with dikes. A concrete gate was constructed on the western side of
the fishpond in 1951. Water breakers were constructed around the dikes to protect them from the
action of the waves. The remaining portion of the area in question is fenced with bamboo stakes.

On the other hand, it is apparent that the area in question is an extension of Lot 986 to the sea and
that its present existence is the result of the continuous recession of the water of the sea. There is
no doubt that the area in question is a foreshore, it being situated along the shore lying between
medium high and low water marks and is covered and uncovered by the flow and ebb of ordinary
tide.

Both Parties claim prior ion of the disputed area, Santolan's claim dating way back in 1907, the year
he claims said area was donated to him by his father-in-law while Lusin alleges that he was already
in possession of the same since 1920. The evidence presented by both parties during the
reinvestigation were so diametrically opposed with each other that they only create doubts as to the
veracity of the respective claims of said parties. From the testimonies of witnesses for both sides,
there could be gathered sufficient grounds to believe that prior to 1942, neither Party Possessed the
area to the exclusion of the other. Rather, there are good reasons to believe that both parties fished
in the premises jointly and/or simultaneously without claiming the property exclusively for themselves
because then the area was covered with water which at that time was still deep. It was only in 1942
that Julian Santolan took positive step to claim the property by filing a foreshore lease and a
revocable permit application for said area with the intention of converting the same into a fishpond.
Santolan caused said area to be surveyed in 1942, the survey plan was approved in 1944 as may be
seen in survey Plan Psu- 115357 of the Bureau of Lands. Since 1942, Santolan exercised dominion
over the property although Lusin occasionally entered the premises with a similar intention of
claiming the area for himself. In January of 1951 Lusin entered the area in question and wrested the
n thereof from Santolan. Since then up to the present, Lusin is in continuous possession of the same
notwithstanding the vigorous opposition of Santolan.

Lusin alleges that the area in question does not fall within the purview of the above quoted Section
32 of Lands Administrative Order No. 7-1 on the theory that the lands enumerated in said provision,
whether foreshore lands, marshy lands, or lands covered with water, must be bordering upon the
shores or banks of navigable lakes or rivers. And it is argued that the area in question is bordering
the shores of Manila Bay, which is neither a lake nor a river, the owner of the adjoining property is
not en to the preferential right accorded by said Lands Administrative Order.

We cannot agree with this contention. This Office is of the opinion and so holds that the said
provision of Lands Administrative Order No. 7-1, Section 32 speaks of the following kinds of lands,
distinct and separate from one another:

(1) Foreshore lands

(2) Marshy lands, or

(3) Land covered with water bordering upon the shores of navigable lakes or rivers.

The phrase "bordering upon the shores of navigable lakes or river" in said provision modifies only
the third classification, that is, "lands covered with water", for if the law that said phrase should
modify the three types of land enumerated are then the punctuation mark, comma, should not have
been placed before the alternative "or" but instead between the words "water" and "bordering"
making said provision to appear as follows:

The owner of the property adjoining foreshore ands marshy lands or lands covered
with water, bordering upon the shores or banks of navigable lakes or rivers ... .

The use of the alternative "or" instead of the conjunction "and" shows the intention of the law in
segregating foreshore lands from marshy lands and those two from lands covered with water
bordering upon shores of navigable lakes or rivers.

It is also alleged that even granting that Santolan was the preferential rights accorded to a riparian
owner, said right has prescribed on the ground that Lusin has been in continuous ion of the said
area since 1920. This allegation was not duly proven during the reinvestigation. While Lusin claims
ion of the disputed area since 1920, on the other hand. Santolan claims that he possessed the same
since 1907 when it was donated to him by his father-in-law. As we have- already stated, it is the -
finding of this Office that prior to 1942, neither party the premises exclusively. It was only in 1942
when Santolan took positive steps to claim the area for himself. There are even evidence on record
that Santolan paid the land taxes for the area in 1936. In 1951, Lusin effected his entry to the area
up to the present. It may be recalled, however, that these actuations of Lusin had been the subject of
a criminal complaint filed by Santolan before the Justice of the Peace Court of Kawit, Cavite,
wherein Lusin was acquitted on the ground that his guilt was not proven beyond reasonable doubt.
Needless to say, proof beyond reasonable doubt is absolutely necessary before conviction in
criminal cases could be had. On the other hand, preponderance of evidence is sufficient to prove a
matter of fact in civil and/or administrative cases. The preponderance of evidence adduced at the
reinvestigation of this case conducted by a representative of this Office, shows that the present
occupation of Lusin of the area in question was effected by force, although there are good reasons
to believe that such force was employed by Lusin to assert what he believed was his right over the
property in question.

From the foregoing facts and circumstances, it is therefore, apparent that the area in question is a
foreshore land, and Santolan, being the riparian owner, is entitled to the preferential rights accorded
by the provision of Section 32 of Lands Administrative Order No. 7-1. Considering, however, the fact
that during the reinvestigation of this case, it was disclosed that Antonio Lusin had introduced
considerable improvements in the premises and had invested his life savings therefor, and
considering further that if Santolan were the one who converted the area into a fishpond, as he
intends to do, he would have incurred the same expenses as was incurred by Lusin in the premises
in question, it is the belief of this Office that justice would be fully served if Santolan be required to
reimburse Lusin of the value of the improvements now existing in the area as may be appraised by
the Committee on Appraisal of the Bureau of Lands.

WHEREFORE, the above-noted foreshore lease (New) application and revocable permit (New)
application of Antonio Lusin should remain, as hereby it is, REJECTED; and Foreshore Lease
Application No. V-65 of Julian Santolan given due course, PROVIDED, he reimburses Antonio Lusin
of the appraised value of the improvements now existing in the area within sixty (60) days after
notification of said appraisal.

The Director of Lands is hereby directed to instruct the Committee on Appraisal concerned to make
the necessary appraisal of the value of the improvements now existing in the area in question within
thirty (30) days from receipt of this order and to notify Julian Santolan of the result of said appraisal.

In the event that Julian Santolan fails to reimburse Antonio Lusin of the appraisal value of the said
improvements within the period specified in this order, he shall lose his preferential rights over the
area and Antonio Lusin will be allowed to file an appropriate public land application therefor.

SO ORDERED.

Manila, Philippines, December 14, 1954.

By Authority of the Secretary:

JAIME M. FERRER
Undersecretary of Agriculture
and Natural Resources

ANNEX F

ORDER

On December 14, 1954, this Office issued an order in connection with the above-entitled case
wherein the rejection of the foreshore lease application and revocable permit (both new) of Antonio
Lusin was upheld and Foreshore Lease Action No. V-62 of Julian Santolan given due course
provided he reimburses Antonio Lusin of the appraised value of the improvements now existing in
the area within sixty (60) days after notification of said appraisal.

From said order, both parties to this conflict filed separate motions seeking reconsideration of the
same.

Santolan premised his motion on the theory that as fat as that po of the order which requires him to
reimburse Lusin of the appraised value of the improvements within sixty (60) days after notification
of said appraisal is concerned, same is contrary to the provisions of Commonwealth Act No. 141 and
of the New Civil Code.

Santolan argues that the best procedure that should have been followed in the disposition of this
case was for the Government to forfeit all the improvements introduced by Lusin in the area in
question in its (Government's) favor and then let Santolan pay to the Government the appraised
value of said improvements within ten (10) years after notification of said appraisal. He further
argues that the "law does not authorize the Secretary of Agriculture and Natural Resources to
dispose of the proceeds of the sale of the improvement to any person whomsoever", and "certainly
the Secretary does not claim the prerogative of disbursing government funds without authority of
law."

In the first place, the order sought to be reconsidered does not contemplate any ale from which
proceeds could be disposed of by the Secretary "to any person whomsoever". In the second Place,
in the issuance of the order sought to be reconsidered this Office has taken into consideration the
Provisions of Wealth Act No. 141 and those of the Civil Code cited by movant Santolan with in go
me respect to the forfeiture ' favor of the government of the improvements found in the areas
covered by rejected applications. However, this Office is also fully aware of that cardinal principle
that 'no man shall enrich himself at the expense of another.

During the reinvestigation of this case by a representative of this Office, it was found that Lusin was
the, actual occupant of the disputed area since 1951. During his occupation, Lusin was introduced
considerable improvements in the area, investing his life savings therein. At the time of inspection,
approximately two (2) hectares of the said area was a veritable and complete with dikes and water
breakers, and the remaining portion was surrounded with bamboo stakes. While this Office of Lusin's
occupation as having effected by force, this Office also believes that such force was employed by
Lusin only to enforce what he believed was his right over the property in question. This being the
case, justice and equity demands that Lusin should be compensated of the improvements
introduced by him in the area in question by whomsoever shall enjoy the fruits of his (Lusin's) toil.
Julian Santolan, being the person who shall benefit from said improvements, it is only fair and just
that he should reimburse Lusin of the value of said improvements, especially considering that the
said area adjudicated to Santolan is already a producing fishpond.

Antonio Lusin, on the other hand, contends that the order sought to be reconsidered is contrary to
the facts of the case and to the law applicable thereto.

Lusin assigns the following errors as having been allegedly committed by this Office:

(1) In holding that the possession of Lusin dated only as Of 195 1;

(2) In holding that the ion of Lusin was effected through force;

(3) In holding that Section 32 of Lands Administrative Order No. 7-1 is applicable in the instant case;
(4) In not holding that the preferential rights of Julian Santolan, granting that he has any, has already
prescribed; and

(5) In giving due course to the foreshore lease application of Santolan for the entire area in question.

With respect to the first two assignments of errors, a review of the records of this case shows that
the findings of this Office are in accordance with the facts of the case as deduced from the
reinvestigation Of this conflict, and as supported by previous records of this case. This Office,
therefore, finds no sufficient ground to disturb its findings of facts.

Anent the next two assignments of errors, which are mere reiteration of movant's allegation in his
previous memorandum, and which were thoroughly passed upon by this Office, it is believed that
discussing them further is no longer necessary since after another close examination of the case,
this Office finds its disposition in this particular respect well justified and in accordance with the law
and regulations applicable thereto.

Now coming to the last allegation, Lusin contends that the foreshore lease application of Julian
Santolan, if given the course, should not cover the entire area in question. Movant Lusin advances
the theory that since the reason behind the law in granting preferential rights to reparian owners is to
compensate for whatever loss said riparian owner may suffer from the actions of the water, said
riparian owner cannot stand to lose more than what he owns, and therefore, since Santolan's
property, which adjoins the area in question, is only two (2) hectares, Santolan can never lose more
than two hectares.

Section 32 of Lands Administrative Order No. 7-1, the particular Point of law involved provides as
follows:

32. Preference of Riparian Owner.— The owner of the property adjoining foreshore
lands, marshy lands, or lands covered with water bordering upon the shores or banks
of navigable lakes or rivers, shall be given preference to apply for such lands,
adjoining his property as may not be needed for the public service, subject to the
laws and regulations governing lands of this nature, provided that he applied therefor
within sixty (60) days from the date he receives a communication from the Director of
Lands advising him of his preferential right.

The above-quoted provision of the Lands Administrative Order does not impose any restriction or
limitation with respect to the extent of the area to which a riparian owner is preferred as long as said
area is not needed for public service. The said order, being clear on this point, this Office has no
other alternative but to interpret said regulation in the meaning it clearly conveys.

IN VIEW OF ALL THE FOREGOING CONSIDERATIONS, the instant motion for reconsideration
filed respectively by the conflicting parties herein, should be, as hereby they are, denied.

SO ORDERED.

Manila, Philippines, May 19, 1955.

By authority of the Secretary:

 JAIME N. FERRER
Undersecretary of Agriculture
and Natural Resources

ANNEX G

4th Indorsemen

Manila, April 10, 1958

Respectfully returned to the Secretary of Agriculture and Natural Resources, Manila.

This is with reference to the appeal by Antonio Lusin from the order of that Department in DANR
Case No. 625 (Julian Santolan vs. Antonio Lusin) dated May 19. 1955, whereby his motion for
reconsideration of the order of that office of December 14, 1954, rejecting his foreshore lease
application for the disputed land but awarding to him the right of reimbursement for the
improvements he had introduced thereon and giving due course to appellee's application therefor,
was denied.

The land in question is a foreshore land of about 4-1/2 hectares located along Bacoor Bay in barrio
Kaingin, Kawit, Cavite. A preferential right to lease it is claimed by the appellant on the ground that
he has been in the continuous and exclusive possession thereof since 1920. when said land was still
under water and used as a site of his fish corals. On the other hand, it is alleged by the appellee that
the disputed lot is an extension of his property into the sea, as he is the owner of Lot No. 986 which,
according to its technical description, borders Bacoor Bay on the North; that the present foreshore
land was formed by soil deposits brought by the action of the sea; and that he has the right of
preference to apply for the land in question in accordance with Section 32 of Lands Administrative
Order No. 7-1.

Upon the foregoing facts, the Director of Lands in an order dated February 1, 1951, rejected the
appellant's foreshore lease application and forfeited the improvements he had introduced thereon in
favor of the appellee. From this order, Lusin appealed to the Secretary of Agriculture and Natural
Resources after his three motions for reconsideration had been denied. On October 13, 1952, the
Secretary dismiss his appeal. Thereafter, the appellant moved for a reconsideration of the
Secretary's decision but his motion was denied on February 28, 1953. He then filed another motion
requesting a formal reinvestigation of the case. The motion was granted and that Department
ordered a reinvestigation of the case on May 12, 1953.

In the reinvestigation of the case, the following facts were established: That Lusin had converted two
(2) hectares of the area in dispute into a veritable fishpond; and that the entire area in question was
enclosed with dikes and provided with two (2) sluice gates, one of which was made of concrete and
the other of lumber; that on the northern part of the disputed land bordering Bacoor Bay were
bamboo poles placed at close intervals serving as water breakers to protect the mud dikes from
being washed away by the action of the sea; that all of these improvements were introduced by
Lusin in 1951 up to the time of the reinvestigation; that the disputed land was, as it still is. bounded
on the South by Lot No. 986 of Julian Santolan; that said land was formed by soil deposits brought
by the action of the sea; that in December 1942, Santulan caused the survey of the land, and the
survey plan was approved by the Director of Lands in 1944; that on December 29, 1942, Santulan
filed a foreshore lease application covering an area of 36,120 square meters of the land in dispute;
that the filing of Santolan's foreshore lease application resulted in the investigation of the case in
March 1943, involving the parties herein. and that said investigation was not finally terminated for
unknown reasons.

After receiving and considering the report of the reinvestigation, that office on December 14, 1954,
issued an order modifying its previous stand by giving the appellant the right to reimbursement for
the improvements he had introduced on the disputed lot, the dispositive part of which reads:

Wherefore, the above noted foreshore lease (New) application and revocable permit
(New) application of Antonio Lusin should remain, as hereby it is, REJECTED; and
Foreshore Lease application No. V-62 of Julian Santulan given due course,
PROVIDED, he reimburse Antonio Lusin of the appraised value of the improvements
now existing in the area within sixty (60) days after notification of said appraisal.

xxx xxx xxx

In the event that Julian Santulan fails to reimburse Antonio Lusin of the appraised
value of the said improvements within the period specified in this order, he shall lose
his preferential rights over the area and Antonio Lusin will be allowed to file an
appropriate public land application therefor.

The appellant moved for a reconsideration of the foregoing order but his motion was denied on May
19, 1955. Dissatisfied, he appealed to this Office, averring that the Department erred in finding the
following: That the possession of Antonio Lusin of the land in question began only in 195 1; that
since 1942, Julian Santulan had been exercising dominion over the property in question; that the
area in question is apparently an extension of lot No. 986 into the sea and that its present existence
was the result of the continuous recession of the sea; that the possession of Antonio Lusin over the
property in question was effected through force; that Section 32, Lands Administrative Order No. 7-
1, is applicable to the instant case; and that the preferential rights of Julian Santolan, granting he has
any, has not prescribed. He contends further that the Department erred in rejecting his foreshore
lease application and in giving due course to that of the appellee.

The main issue presented by the parties to be resolved in this controversy is, which of them has a
better right to lease the foreshore land under consideration? For a clear resolution of the question, it
is necessary to look into the legal provisions governing the administration and disposition of
foreshore lands. As correctly held by that Department and the Bureau of Lands, the administration
and disposition of foreshore lands are governed by Chapter IX, Title III of Commonwealth Act No.
141, (Secs. 58 and 59), otherwise known as the Public Land Act.

Section 61 of said law provides that foreshore lands shall be disposed of to private parties by lease
only and not otherwise, as soon as the President, upon recommendation by the Secretary of
Agriculture and Natural Resources, shall declare that the same are not necessary for the public
service and are open to disposition, The procedure for the award of a lease of foreshore land is
found in Section 67 of the same law which provides, as a general rule, that the award of the right to
lease a foreshore land shall be determined by oral bidding, except where improvements were
introduced thereon by reason of a permit issued by competent authority, in which case the award
thereof shall be determined by sealed bidding pursuant to the provisions of section 26, whereby the
permittee is granted the right to equal the highest bidder.

Noteworthy is the fact that both parties herein claim to have been in prior possession of the land in
controversy than the other. Not one of them, however, was granted a permit by competent authority
to occupy and use the land and introduce improvements thereon. Since not one of them was granted
such a permit, the fact that one or the other had been in prior possession of the premises in question
is immaterial, as will be seen hereafter, in the determination of the instant controversy. Neither is the
alleged finding that one of the parties herein entered the premises and introduced improvements
thereon in bad faith material to the resolution of the case.

It is likewise significant to note that while the Bureau held that none of the parties herein was entitled
to a preferential right to lease the land in question "on the basis alone of Actual occupancy or
introduction of improvements," it ruled that the appellee, Julian Santolan, by reason of the fact that
he was, as he still is, a riparian owner of the disputed area, had a preferential right to apply for a
lease therefor, citing Section 32 of Lands Administrative Order No. 7-1, which reads:

Sec. 32. The owner of the property adjoining foreshore lands, marshy lands, or lands
covered with water bordering upon the shores or banks of navigable lakes or rivers,
shall be given preference to apply for such lands adjoining his property as may not
be needed for the public service, subject to the laws and regulations governing lands
of this nature, provided that he applies therefor within 60 days from the date he
receives a communication from the Director of Lands advising him of his preferential
right.

In this appeal, the appellant reiterates his contention before that Department that the foregoing is not
applicable to the instant case "because the property in question borders upon the shores or banks of
the Manila Bay and not upon navigable lakes or rivers." The fallacy of the argument is too obvious to
require any discussion since the provision expressly speaks of foreshore lands. At any rate, this
Office finds that Section 32 of Lands Administrative Order No. 7-1 has been rendered obsolete by
Commonwealth Act No. 141.

Lands Administrative Order No. 7-1, dated April 30, 1936, but made effective on January 1, 1936,
was promulgated before. the passage of Commonwealth Act No. 141. Its provisions which have not
been altered, modified or amended, particularly Section 32 thereof, were promulgated pursuant to
the existing public land law at the time of its promulgation, namely, Act No. 2874. A perusal of
Section 32 of Lands Administrative Order No. 7-1 will show that while it speaks of a preferential right
to apply for a foreshore land, it does not specify the mode of application, i.e., whether by sale, lease,
homestead, permit, etc., contemplated by it. Nevertheless it is clear under Act No. 2874 that a
foreshore land may be the subject only of a lease (Sec. 58), or of a revocable permit to occupy and
use it (Sec. 65). Seemingly therefore Section 32 of Lands Administrative Order No. 7-1 contemplates
an application for a lease of foreshore land or a revocable permit to use or occupy it. However,
Section I of said order provides, among other things, the following:

... Those rules and regulations shall not apply to applications for temporary
occupation or provisional use of Said lands and property which shall be governed by
the provisions of Section 1844 of the Administrative Code, as amended, by Acts Nos.
3077 and 3852, Lands Administrative Order No. 8 and other regulations promulgated
thereunder.

Since Lands Administrative Order No. 7-1 expressly exempts from its operation temporary permits
for the use and occupation of public lands, the conclusion is inescapable that Section 32 thereof
contemplates an application for a lease under Section 58 of Act No. 2874 only and does not include
a revocable permit application under Section 65 of said Act.

The procedure for the award of the right to lease a foreshore land under Act No. 2874 is found in
Section 64 thereof, which reads:
 Sec. 64. The lease or sale shall be adjudicated to the highest bidder; and if there is
no bidder besides the applicant, it shall be adjudicated to him. The provisions of
Section twenty-seven of this Act shall be applied wherever applicable.

Section 67 of Commonwealth Act No. 141, repealing the foregoing provisions, provides:

Sec. 67. The lease or sale shall be made through oral bidding; and adjudication shall
be made to the highest bidder. However, where an has made improvements on the
land by virtue of a permit issued to him by competent authority, the sale or lease
shall be made by sealed bidding as prescribed in section twenty-six of this Act, "the
provisions of which shall he applied wherever applicable. x x" (Italics supplied).

While Section 64 of Act No. 2874 makes a reference to Section 27 of the same Act, Section 67 of
Commonwealth Act No. 141 also Makes a reference to Section 26 of the latter law, Section 26 of
Commonwealth Act No. 141 is practically a reproduction of Section 27 of Act No. 2874 and
prescribes the manner or procedure of determining an award through sealed bidding in the sale of a
public land. Under its provision, an applicant is given the option or right to equal the highest bidder.

Section 67 of Commonwealth Act No. 141 differs, however, from Section 64 of Act No. 2874 in that
while the latter provides that "section twenty- seven of this Act shall be applied wherever applicable,"
making sealed bidding the general rule of procedure in determining an award of a lease of foreshore
land, the former Provides the contrary, as under its provisions sealed bidding is not the general rule
of procedure in the determination of lease awards of foreshore lands but may be resorted to only
when the conditions specified therein are present.

Since Section 64 of Act No. 2874 provides that Section 27 thereof should be applied wherever
applicable in determining an award of a lease of foreshore land, the mere fact that the land is
covered by a lease application therefor warrants the holding of a sealed bidding for its disposition,
whereby the applicant therefor should be granted the option or right to equal the highest bid. In such
a legal set-up, the question of preference in the right to apply for a lease of foreshore land became a
necessary consequence, as one need only apply to be entitled to the right to equal the highest bid
hence, the applicability of Section 32 of Lands Administrative Order No. 7-1.

On the other hand, under Section 67 of Commonwealth Act No. 141, a foreshore land may be
leased, as a general rule, by oral bidding only. In such a case, the award of the foreshore lease shall
always be made to the highest bidder, notwithstanding the fact that one among the bidders is an
applicant, as no one in an oral bidding is entitled to equal the highest bid, unlike in the case of a
sealed bidding either under Section 27 of Act No. 2874 or under Section 26 of Commonwealth Act
No. 141. Since the award of a foreshore lease shall be given to the highest bidder in an oral bidding,
the necessity of determining who among several interested parties has a preferential right to apply
for the land has been obviated under the present law, because the mere fact that one is an applicant
does not entitle him to equal the highest bid, rendering the provisions of Section 32 of Lands
Administrative Order No. 7-1 Idle and useless.

Parenthetically, it may be stated that the appellee brought to the attention of this Office its previous
decision in DANR Case No. 694 (Del Rosario vs. Monzon), where the facts involved therein are
more or less similar to those in the present controversy. While this Office in that case relied on
Section 32 of Lands Administrative Order No. 7-1 in resolving the appeal therein, it did not touch on
the question of whether or not said provision is still enforceable, as the same was not squarely
placed in issue. For this reason, the ruling in that case can not be availed of as a precedent in the
adjudication of the one under consideration.
In the instant case the parties are vying for the preferential right to apply for a lease of the disputed
land, as if by the mere fact of application the land should be disposed of by scaled bidding, whereby
the recognized applicant therefor should be given the right accorded to applicants under Section 26
of Commonwealth Act No. 141. The only instance under Section 67 of Commonwealth Act No. 141
when a foreshore land may be leased through sealed bidding is when the conditions specified
therein — namely, a that improvements had been introduced on the land and (b) that said
improvements were introduced thereon by reason of a permit issued by competent authority — are
present, in which case the permittee shall be granted the right to equal the highest bid. In the
absence of these conditions, the land should be leased through oral bidding only and, as stated
earlier. the question of preference in the right to apply therefor is immaterial.

As the conditions specified in Section 67 of Commonwealth Act No. 141 are not present in the
instant case, the land in question can be leased only through oral bidding, if it can be disposed of
under the provisions of Section 61 of said Act, which requires as a condition sine qua non in the
lease of foreshore lands that the same have been declared by the President not necessary for the
public service and are open for disposition. Without such a declaration, a foreshore land may only be
occupied and used by private persons for lawful purposes upon the issuance of a revocable permit
therefor under Section 68 of Commonwealth Act No. 141. Since the record is silent as to whether or
not the land under consideration has been so declared, this Office is constrained to render two
alternative resolutions of the instant case.

On the assumption that the land in question has been declared open for disposition and is not
necessary for the public service, this Office directs that an oral bidding for the leasing thereof to
interested parties pursuant to the provisions of Section 67 of Commonwealth Act No. 141 be
conducted and the contract of lease awarded to the highest bidder. Whoever shall be the highest
bidder, if other than the appellant, shall be required to pay to the appellant the appraised value of the
improvements introduced by him on the land to be determined by that Department.

If the land in question has not been so declared, this Office directs that a revocable permit under
Section 68 of Commonwealth Act No. 141 be issued to the appellant requiring him to pay permit fees
since the year 1951.

Accordingly, the orders and decisions of that Department and the Bureau of Lands are hereby
revoked. The record of the case is returned herewith.

By authority of the President:

(SGD) JUAN C. PAJO

Executive Secretary

ANNEX H

5th Indorsement

Manila, May 10, 1954

Respectfully returned to the Honorable, the Secretary of Agriculture and Natuaral Resources,
Manila.

In his decision of February 4, 1952, the Director ofLands amended the miscellaneous sales
application of Emiliano del Rosario by excluding therefrom portion "B" and adjudicating the same to
Gonzalo Monzon under his foreshore lease application. On appeal by Del Rosario, the decision of
the Director of Lands was affirmed by the Secretarty of Agriculture and Natural Resources on
February 6, 1953. Del Rosario now appeals to this office.

The question presented for determination is, whichof theparties has a better right to the area in
question?

It appears that the area in dispute, portion "B", is a foreshore land, an extension od portion "a", which
lies immediately adjacent to lot No. 987, private property ofMonzon. The record shows that Monzon
and his predecessor in interest have been in possession od said area since before the war, using it
as a site for their oyster and "kapis" beds and for the fish coral. It was only in 1951 that Del Rosario
through stealth occupied a portion of area in question, building earthen dikes preparatory to
converting the land into a fishpond. His entry upon the area was duly protested by Monzon with the
Bureau of Lands and the Bureau of Fisheries, both of wich is advised Del Rosario to vacate the
premises and to refrain from introducing further improvements thereon.

Upon the facts and the circumstances narrated above, and the pursuant to Section 32 of Lands
Administrative Order No. 7-1, which gives tot he owner of the property adjoining foreshores lands
and the prefrential right to apply therefor under the provisions of the Public Act, it is evident that
Monzon has a better right than Del Rosario tot he area in dispute which, as stated above, is
aforeshore land.

In view of foregoing, the decision appealed from is hereby affirmed.

The record of the case is returned herewith.

By authority of the President:

(SGD.) FRED RUIZ CASTRO

executive Secretary
FRANCISCO I. CHAVEZ v. PUBLIC ESTATES AUTHORITY, GR No. 133250, 2002-07-09
Facts:
On November 20, 1973, the government, through the Commissioner of Public Highways,
signed a contract with the Construction and Development Corporation of the Philippines
("CDCP" for brevity) to reclaim certain foreshore and offshore areas of Manila Ba... y
On February 4, 1977, then President Ferdinand E. Marcos issued Presidential Decree No.
1084 creating PEA.
On the same date, then President Marcos issued Presidential Decree No. 1085 transferring
to PEA the "lands reclaimed in the foreshore and offshore of the Manila Bay"[2] under the
Manila-Cavite Coastal Road and Reclamation Project (MCCRRP).
April 25, 1995, PEA entered into a Joint Venture Agreement ("JVA" for brevity) with AMARI,
a private corporation, to develop the Freedom Islands.
Issues:
WHETHER THE STIPULATIONS IN THE AMENDED JOINT VENTURE AGREEMENT
FOR THE TRANSFER TO AMARI OF CERTAIN LANDS, RECLAIMED AND STILL TO BE
RECLAIMED, VIOLATE THE 1987 CONSTITUTION
The threshold issue is whether AMARI, a private corporation, can acquire and own under
the Amended JVA 367.5 hectares of reclaimed foreshore and submerged areas in Manila
Bay in view of Sections 2 and 3, Article XII of the 1987 Constitution which state that:
"Section 2. All lands of the public domain, waters, minerals, coal, petroleum, and other
mineral oils, all forces of potential energy, fisheries, forests or timber, wildlife, flora and
fauna, and other natural resources are owned by the State. With the... exception of
agricultural lands, all other natural resources shall not be alienated.
Section 3. x x x Alienable lands of the public domain shall be limited to agricultural lands.
Private corporations or associations may not hold such alienable lands of the public domain
except by lease, x x x."(Emphasis... supplied)
Ruling:
In the instant case, AMARI seeks to acquire from PEA, a public corporation, reclaimed
lands and submerged areas for... non-agricultural purposes by purchase under PD No.
1084 (charter of PEA) and Title III of CA No. 141. Certain undertakings by AMARI under the
Amended JVA constitute the consideration for the purchase.
Neither AMARI nor PEA can claim... judicial confirmation of their titles because the lands
covered by the Amended JVA are newly reclaimed or still to be reclaimed.
The Spanish Law of Waters of 1866 and the Civil Code of 1889
"Article 5. Lands reclaimed from the sea in consequence of works constructed by the State,
or by the provinces, pueblos or private persons, with proper permission, shall become the
property of the party constructing such works, unless otherwise provided by the... terms of
the grant of authority."
Article 339 of the Civil Code of 1889 defined property of public dominion as follows:
"Art. 339. Property of public dominion is
1. That devoted to public use, such as roads, canals, rivers, torrents, ports and bridges
constructed by the State, riverbanks, shores, roadsteads, and that of a similar character;
2. That belonging exclusively to the State which, without being of general public use, is
employed in some public service, or in the development of the national wealth, such as
walls, fortresses, and other works for the defense of the territory, and... mines, until granted
to private individuals."
This provision, however, was not self-executing. The legislature, or the executive
department pursuant to law, must declare the property no longer needed for public use or
territorial defense before the government could lease or alienate the property to private...
parties
Act No. 1654 of the Philippine Commission
On May 8, 1907, the Philippine Commission enacted Act No. 1654 which regulated the
lease of reclaimed and foreshore lands. The salient provisions of this law were as follows:
"Section 1. The control and disposition of the foreshore as defined in existing law, and the
title to all Government or public lands made or reclaimed by the Government by dredging or
filling or otherwise throughout the
Philippine Islands, shall be retained by the Government without prejudice to vested rights
and without prejudice to rights conceded to the City of Manila in the Luneta Extension.
Act No. 1654 mandated that the government should retain title to all lands reclaimed by the
government.
Act No. 1654, however, did not repeal Section 5 of the Spanish Law of Waters of 1866.
Act No. 2874 of the Philippine Legislature
On November 29, 1919, the Philippine Legislature enacted Act No. 2874, the Public Land
Act.[46] The salient provisions of Act No. 2874, on reclaimed lands, were as follows:
"Sec. 6. The Governor-General, upon the recommendation of the Secretary of Agriculture
and Natural Resources, shall from time to time classify the lands of the public domain into
(a)Alienable or disposable
(b) Timber, and
(c) Mineral lands, x x x.
Sec. 7. For the purposes of the government and disposition of alienable or disposable
public lands, the Governor-General, upon recommendation by the Secretary of Agriculture
and Natural Resources, shall from time to time... declare what lands are open to disposition
or concession under this Act."
Sec. 8. Only those lands shall be declared open to disposition or concession which have
been officially delimited or classified
Sec. 55. Any tract of land of the public domain which, being neither timber nor mineral land,
shall be classified as suitable for residential purposes or for commercial, industrial, or other
productive purposes other than agricultural purposes,... and shall be open to disposition or
concession, shall be disposed of under the provisions of this chapter, and not otherwise.
Sec. 56. The lands disposable under this title shall be classified as follows:
(a) Lands reclaimed by the Government by dredging, filling, or other means;
(b) Foreshore;
(c) Marshy lands or lands covered with water bordering upon the shores or banks of
navigable lakes or rivers;
(d) Lands not included in any of the foregoing classes.
Sec. 58. The lands comprised in classes (a), (b), and (c) of section fifty-six shall be
disposed of to private parties by lease only and not otherwise, as soon as the Governor-
General, upon recommendation by the Secretary of Agriculture and
Natural Resources, shall declare that the same are not necessary for the public service and
are open to disposition under this chapter. The lands included in class (d) may be disposed
of by sale or lease under the provisions of this Act."
(Emphasis supplied)
These provisions vested upon the Governor-General the power to classify inalienable lands
of the public domain into disposable lands of the public domain
Section 58 of Act No. 2874 categorically mandated that disposable lands of the public
domain classified as government reclaimed, foreshore and marshy lands "shall be disposed
of to private parties by lease only and not otherwise."
The rationale behind this State policy is obvious. Government reclaimed, foreshore and
marshy public lands for non-agricultural purposes retain their inherent potential as areas for
public service.
Dispositions under the 1935 Constitution
The 1935 Constitution barred the alienation of all natural resources except public
agricultural lands, which were the only natural resources the State could alienate.
Thus, foreshore lands, considered part of the State's natural resources, became inalienable
by... constitutional fiat, available only for lease for 25 years, renewable for another 25 years.
The prohibition on private parties from acquiring ownership of government reclaimed and
marshy lands of the public domain was only a statutory prohibition and the legislature could
therefore remove such prohibition. The 1935 Constitution did not prohibit individuals and...
corporations from acquiring government reclaimed and marshy lands of the public domain
that were classified as agricultural lands under existing public land laws.
Still, after the effectivity of the 1935 Constitution, the legislature did not repeal Section 58 of
Act No. 2874 to open for sale to private parties government reclaimed and marshy lands of
the public domain.
Commonwealth Act No. 141 of the Philippine National Assembly
CA No. 141, as amended, remains to this day the existing general law... governing the
classification and disposition of lands of the public domain other than timber and mineral
lands
Section 6 of CA No. 141 empowers the President to classify lands of the public domain into
"alienable or disposable
Thus, before the government could alienate or dispose of lands of the public domain, the
President must first officially classify these lands as alienable or disposable, and then
declare them open to disposition or concession. There must be no law reserving these
lands... for public or quasi-public uses.
Section 61 of CA No. 141 readopted, after the effectivity of the 1935 Constitution, Section
58 of Act No. 2874 prohibiting the sale of government reclaimed, foreshore and marshy
disposable lands of the public domain.
Foreshore lands are lands of public dominion intended for public use. So too are lands
reclaimed by the government by dredging, filling, or other means. Act 1654 mandated that
the control and disposition of the foreshore and lands under water remained in the...
national government.
Since then and until now, the only way the government can sell to private parties
government reclaimed and marshy disposable lands of the public domain is for the
legislature to pass a law authorizing such sale.
The congressional authority required in Section 60 of CA No. 141 mirrors the legislative
authority required in Section 56 of Act No. 2874.
Again, the government must formally declare that the property of public dominion is no
longer needed for public use or public service, before the same could be classified as
patrimonial property of the State
The 1973 Constitution prohibited the alienation of all natural resources with the exception of
"agricultural, industrial or commercial, residential, and resettlement lands of the public
domain."
The 1973 Constitution, however, limited the alienation of lands of the public domain to
individuals who were citizens of the Philippines. Private corporations, even if wholly owned
by Philippine citizens, were no longer allowed to acquire alienable lands of the public...
domain unlike in the 1935 Constitution.
Thus, under the 1973 Constitution, private corporations could hold alienable lands of the
public domain only through lease
PD No. 1084 authorizes PEA to reclaim both foreshore and submerged areas of the public
domain. Foreshore areas are those covered and uncovered by the ebb and flow of the tide
Submerged areas are those... permanently under water regardless of the ebb and flow of
the tide.
Thus, PEA can hold title to private lands, as well as... title to lands of the public domain.
In order for PEA to sell its reclaimed foreshore and submerged alienable lands of the public
domain, there must be legislative authority empowering PEA to sell these lands.
Without such legislative authority, PEA could not sell but only lease its reclaimed foreshore
and submerged alienable lands of the public domain.
Nevertheless, any legislative authority granted to PEA to sell its reclaimed alienable lands of
the public domain would be... subject to the constitutional ban on private corporations from
acquiring alienable lands of the public domain.
Dispositions under the 1987 Constitution... he 1987 Constitution, like the 1935 and 1973
Constitutions before it, has adopted the Regalian doctrine.
The Rationale behind the Constitutional Ban
Indeed, one purpose of the constitutional prohibition against purchases of public agricultural
lands by private corporations is to equitably diffuse land ownership or to encourage 'owner-
cultivatorship and the economic family-size farm' and to prevent a... recurrence of cases like
the instant case. Huge landholdings by corporations or private persons had spawned social
unrest.
The constitutional intent, under the 1973 and 1987 Constitutions, is to transfer ownership of
only a limited area of alienable land of the public domain to a qualified individual. This
constitutional intent is safeguarded by the provision prohibiting corporations from...
acquiring alienable lands of the public domain, since the vehicle to circumvent the
constitutional intent is removed.
The Amended Joint Venture Agreement
In short, the Amended JVA covers a reclamation area of 750 hectares. Only 157.84
hectares of the 750-hectare reclamation project have been reclaimed, and the rest of the
592.15 hectares are still submerged areas forming part of Manila Bay.
Indisputably, under the Amended JVA AMARI will acquire and own a maximum of 367.5
hectares of reclaimed land which will be titled in its name.
Classification of Reclaimed Foreshore and Submerged Areas
PEA readily concedes that lands reclaimed from foreshore or submerged areas of Manila
Bay are alienable or disposable lands of the public domain.
Under Section 2, Article XII of the 1987 Constitution, the foreshore and submerged areas of
Manila Bay are part of the "lands of the public domain, waters x x x and other natural
resources" and consequently "owned by the State."
As such, foreshore and submerged areas
"shall not be alienated," unless they are classified as "agricultural lands" of the public
domain. The mere reclamation of these areas by PEA does not convert these inalienable
natural resources of the State into alienable or disposable lands of the public domain
Section 8 of CA No. 141 provides that "only those lands shall be declared open to
disposition or concession which have been officially delimited and classified."[72] The
President has the... authority to classify inalienable lands of the public domain into alienable
or disposable lands of the public domain, pursuant to Section 6 of CA No. 141.
PD No. 1085, coupled with President Aquino's actual issuance of a special patent covering
the Freedom Islands, is equivalent to an official proclamation classifying the Freedom
Islands as alienable or disposable lands of the public domain.
The Freedom Islands are thus alienable or disposable lands of the public domain, open to
disposition or concession to qualified... parties.
Article 5 of the Spanish Law of Waters must be read together with laws subsequently
enacted on the disposition of public lands. In particular, CA No. 141 requires that lands of
the public domain must first be classified as alienable or disposable before the
government... can alienate them.
PD No. 3-A repealed Section 5 of the Spanish Law of Waters of 1866 because reclamation
of areas under water could now be undertaken only by the National Government or by a
person contracted by the National Government.
The Amended JVA covers not only the Freedom Islands, but also an additional 592.15
hectares which are still submerged and forming part of Manila Bay. There is no legislative or
Presidential act classifying these submerged areas as alienable or disposable lands of... the
public domain open to disposition.
Section 3 of EO No. 525, by declaring that all lands reclaimed by PEA "shall belong to or be
owned by the PEA," could not automatically operate to classify inalienable lands into
alienable or disposable lands of the public domain.
As manager, conservator and overseer of the natural resources of the State, DENR
exercises "supervision and control over alienable and disposable public lands." DENR also
exercises "exclusive jurisdiction on the management and disposition of all lands of the
public... domain."
DENR also exercises exclusive jurisdiction over the disposition of all lands of the public
domain.
In short, DENR is vested with the power to authorize the reclamation of areas under water,
while PEA is vested with the power to undertake the physical reclamation of areas under
water, whether directly or through private contractors.
Clearly, the mere physical act of reclamation by PEA of foreshore or submerged areas does
not make the reclaimed lands alienable or disposable lands of the public domain, much less
patrimonial lands of PEA.
Absent two official acts a classification that these lands are alienable or disposable and
open to disposition and a declaration that these lands are not needed for public service,
lands reclaimed by PEA remain inalienable lands of the public domain.
PEA contends that PD No. 1085 and EO No. 525 constitute the legislative authority allowing
PEA to sell its reclaimed lands. PD No. 1085, issued on February 4, 1977,... There is no
express authority under either PD No. 1085 or EO No. 525 for PEA to sell its reclaimed
lands. PD No. 1085 merely transferred "ownership and administration" of lands reclaimed
from Manila Bay to PEA, while EO No. 525 declared that lands reclaimed by PEA
"shall belong to or be owned by PEA."
PEA's charter, however, expressly tasks PEA "to develop, improve, acquire, administer,
deal in, subdivide, dispose, lease and sell any and all kinds of lands x x x owned, managed,
controlled and/or operated by the government."
There is, therefore, legislative authority granted to PEA to sell its lands, whether patrimonial
or alienable lands of the public domain.
PEA may sell to private parties its patrimonial... properties in accordance with the PEA
charter free from constitutional limitations.
The constitutional ban on private corporations from acquiring alienable lands of the public
domain does not apply to the sale of PEA's patrimonial lands.
PEA may also sell its alienable or disposable lands of the public domain to private
individuals since, with the legislative authority, there is no longer any statutory prohibition
against such sales and the constitutional ban does not apply to individuals.
PEA, however, cannot sell any of its alienable or disposable lands of the public domain to
private corporations since Section 3, Article XII of the 1987 Constitution expressly prohibits
such sales.
Registration of lands of the public domain
Finally, PEA theorizes that the "act of conveying the ownership of the reclaimed lands to
public respondent PEA transformed such lands of the public domain to private lands."
In the instant case, the only patent and certificates of title issued are those in the name of
PEA, a wholly government owned corporation performing public as well as proprietary
functions.
Registration of land under Act No. 496 or PD No. 1529 does not vest in the registrant
private or public ownership of the land.
Registration is not a mode of acquiring ownership but is merely evidence of ownership
previously conferred by any of the recognized modes of... acquiring ownership.
We can now summarize our conclusions as follows:
The 157.84 hectares of reclaimed lands comprising the Freedom Islands, now covered by
certificates of title in the name of PEA, are alienable lands of the public domain.
PEA may lease these lands to private corporations but may not... sell or transfer ownership
of these lands to private corporations.
The 592.15 hectares of submerged areas of Manila Bay remain inalienable natural
resources of the public domain until classified as alienable or disposable lands open to
disposition and declared no longer needed for public service.
In their present state, the 592.15... hectares of submerged areas are inalienable and
outside the commerce of man.
Since the Amended JVA seeks to transfer to AMARI, a private corporation, ownership of
77.34 hectares[110] of the Freedom Islands, such transfer is void for being contrary to
Section 3,... Article XII of the 1987 Constitution which prohibits private corporations from
acquiring any kind of alienable land of the public domain.
Since the Amended JVA also seeks to transfer to AMARI ownership of 290.156
hectares[111] of still submerged areas of Manila Bay, such transfer is void for being
contrary to Section 2,... Article XII of the 1987 Constitution which prohibits the alienation of
natural resources other than agricultural lands of the public domain.
WHEREFORE, the petition is GRANTED. The Public Estates Authority and Amari Coastal
Bay Development Corporation are PERMANENTLY ENJOINED from implementing the
Amended Joint Venture Agreement which is hereby declared NULL and VOID ab... initio.
Principles:
The Regalian doctrine is the foundation of the time-honored principle of land ownership...
that "all lands that were not acquired from the Government, either by purchase or by grant,
belong to the public domain."
Article 339 of the Civil Code of 1889, which is now Article 420 of the Civil Code of 1950,...
incorporated the Regalian doctrine.
Sections 6, 7 and 8 of CA No. 141 read as follows
"Sec. 6. The President, upon the recommendation of the Secretary of Agriculture and
Commerce, shall from time to time classify the lands of the public domain into
(a) Alienable or disposable,... (b) Timber, and
(c) Mineral lands,... and may at any time and in like manner transfer such lands from one
class to another,[53] for the purpose of their administration and disposition.
Sec. 7. For the purposes of the administration and disposition of alienable or disposable
public lands, the President, upon recommendation by the Secretary of Agriculture and
Commerce, shall from time to time declare what lands are open to... disposition or
concession under this Act.
Sec. 8. Only those lands shall be declared open to disposition or concession which have
been officially delimited and classified and, when practicable, surveyed, and which have not
been reserved for public or quasi-public... uses, nor appropriated by the Government, nor in
any manner become private property, nor those on which a private right authorized and
recognized by this Act or any other valid law may be claimed, or which, having been
reserved or appropriated, have ceased to be so. x x... x."
The salient provisions of CA No. 141, on government reclaimed, foreshore and marshy
lands of the public domain, are as follows:
"Sec. 58. Any tract of land of the public domain which, being neither timber nor mineral
land, is intended to be used for residential purposes or for commercial, industrial, or other
productive purposes other than agricultural, and is open... to disposition or concession, shall
be disposed of under the provisions of this chapter and not otherwise.
Sec. 59. The lands disposable under this title shall be classified as follows:
(a) Lands reclaimed by the Government by dredging, filling, or other means;
(b) Foreshore;
(c) Marshy lands or lands covered with water bordering upon the shores or banks of
navigable lakes or rivers;
(d) Lands not included in any of the foregoing classes.
Sec. 60. Any tract of land comprised under this title may be leased or sold, as the case may
be, to any person, corporation, or association authorized to purchase or lease public lands
for agricultural purposes. x x x
Sec. 61. The lands comprised in classes (a), (b), and (c) of section fifty-nine shall be
disposed of to private parties by lease only and not otherwise, as soon as the President,
upon recommendation by the Secretary of Agriculture,... shall declare that the same are not
necessary for the public service and are open to disposition under this chapter. The lands
included in class (d) may be disposed of by sale or lease under the provisions of this Act."
Sections 2 and 3, Article XII of the 1987 Constitution state that
"Section 2. All lands of the public domain, waters, minerals, coal, petroleum and other
mineral oils, all forces of potential energy, fisheries, forests or timber, wildlife, flora and
fauna, and other natural resources are owned by the State.
With the exception of agricultural lands, all other natural resources shall not be alienated.
The exploration, development, and utilization of natural resources shall be under the full
control and supervision of the State. x x x.
Section 3. Lands of the public domain are classified into agricultural, forest or timber,
mineral lands, and national parks. Agricultural lands of the public domain may be further
classified by law according to the uses which they may be devoted.
Alienable lands of the public domain shall be limited to agricultural lands. Private
corporations or associations may not hold such alienable lands of the public domain except
by lease, for a period not exceeding twenty-five years, renewable for not more than twenty-
five... years, and not to exceed one thousand hectares in area. Citizens of the Philippines
may lease not more than five hundred hectares, or acquire not more than twelve hectares
thereof by purchase, homestead, or grant.
aking into account the requirements of conservation, ecology, and development, and
subject to the requirements of agrarian reform, the Congress shall determine, by law, the
size of lands of the public domain which may be acquired, developed, held, or leased... and
the conditions therefor."
Like the 1973 Constitution, the 1987 Constitution allows private corporations to hold...
alienable lands of the public domain only through lease.

Chavez v. Pea and Amari

Fact:
In 1973, the Comissioner on Public Highways entered into a contract to reclaim areas of Manila Bay
with the Construction and Development Corportion of the Philippines (CDCP).
PEA (Public Estates Authority) was created by President Marcos under P.D. 1084, tasked with
developing and leasing reclaimed lands. These lands were transferred to the care of PEA under P.D.
1085 as part of the Manila Cavite Road and Reclamation Project (MCRRP). CDCP and PEA entered
into an agreement that all future projects under the MCRRP would be funded and owned by PEA.

By 1988, President Aquino issued Special Patent No. 3517 transferring lands to PEA. It was followed
by the transfer of three Titles (7309, 7311 and 7312) by the Register of Deeds of Paranaque to PEA
covering the three reclaimed islands known as the FREEDOM ISLANDS.

Subsquently, PEA entered into a joint venture agreement (JVA) with AMARI, a Thai-Philippine
corporation to develop the Freedom Islands. Along with another 250 hectares, PEA and AMARI
entered the JVA which would later transfer said lands to AMARI. This caused a stir especially when
Sen. Maceda assailed the agreement, claiming that such lands were part of public domain (famously
known as the “mother of all scams”).

Peitioner Frank J. Chavez filed case as a taxpayer praying for mandamus, a writ of preliminary
injunction and a TRO against the sale of reclaimed lands by PEA to AMARI and from implementing
the JVA. Following these events, under President Estrada’s admin, PEA and AMARI entered into an
Amended JVA and Mr. Chaves claim that the contract is null and void.

Issue:
w/n: the transfer to AMARI lands reclaimed or to be reclaimed as part of the stipulations in the
(Amended) JVA between AMARI and PEA violate Sec. 3 Art. XII of the 1987 Constitution
w/n: the court is the proper forum for raising the issue of whether the amended joint venture
agreement is grossly disadvantageous to the government.

Held:
On the issue of Amended JVA as violating the constitution:
1. The 157.84 hectares of reclaimed lands comprising the Freedom Islands, now covered by
certificates of title in the name of PEA, are alienable lands of the public domain. PEA may lease these
lands to private corporations but may not sell or transfer ownership of these lands to private
corporations. PEA may only sell these lands to Philippine citizens, subject to the ownership
limitations in the 1987 Constitution and existing laws.

2. The 592.15 hectares of submerged areas of Manila Bay remain inalienable natural resources of the
public domain until classified as alienable or disposable lands open to disposition and declared no
longer needed for public service. The government can make such classification and declaration only
after PEA has reclaimed these submerged areas. Only then can these lands qualify as agricultural
lands of the public domain, which are the only natural resources the government can alienate. In
their present state, the 592.15 hectares of submerged areas are inalienable and outside the commerce
of man.

3. Since the Amended JVA seeks to transfer to AMARI, a private corporation, ownership of 77.34
hectares110 of the Freedom Islands, such transfer is void for being contrary to Section 3, Article XII
of the 1987 Constitution which prohibits private corporations from acquiring any kind of alienable
land of the public domain.

4. Since the Amended JVA also seeks to transfer to AMARI ownership of 290.156 hectares111 of still
submerged areas of Manila Bay, such transfer is void for being contrary to Section 2, Article XII of
the 1987 Constitution which prohibits the alienation of natural resources other than agricultural
lands of the public domain.

PEA may reclaim these submerged areas. Thereafter, the government can classify the reclaimed
lands as alienable or disposable, and further declare them no longer needed for public service. Still,
the transfer of such reclaimed alienable lands of the public domain to AMARI will be void in view of
Section 3, Article XII of the 1987Constitution which prohibits private corporations from acquiring
any kind of alienable land of the public domain.
 [G.R. No. 14167. August 14, 1919. ]

THE GOVERNMENT OF THE PHILIPPINE ISLANDS, petitioner and appellee. ANTIPAS VAZQUEZ and
BASILIO GAYARES, Petitioners-Appellants, v. RUFINA ABURAL ET. AL., objectors-appellees.

Cohn & Fisher, for Appellants.

Hilado & Hilado, for Appellees.

SYLLABUS

1. LAND REGISTRATION; TORRENS SYSTEM; PURPOSE. — The prime purpose of the Torrens System, as
established in the Philippine Islands by the Land Registration Law (Act No. 496), is to decree land titles that
shall be final, irrevocable, and indisputable.

2. ID.; CADASTRAL SYSTEM; PURPOSE. — The purpose of the offspring of the Torrens System here known
as the Cadastral System, as established in the Philippine Islands by the Cadastral Act (No. 2259), is, like the
purpose of the Torrens System, proper incontestability of title. As stated in Section 1 of the Cadastral Act,
the purpose is to serve the public interest, by requiring that the titles to any lands "be settled and
adjudicated."cralaw virt ua1aw li bra ry

3. ID.; ID.; PROCEEDINGS. — Many precautions are taken to guard against injustice.

4. ID.; ID.; ID. — After trial in a cadastral case, three actions are taken. The first adjudicates ownership in
favor of one of the claimants. This constitutes the decision — the judgment — the decree of the court. The
second action is the declaration by the court that the decree is final and its order for the issuance of the
certificates of title by the Chief of the Land Registration Office. Such order is made if within thirty days from
the date of receipt of a copy of the decision no appeal is taken from the decision. The third and last action
devolves upon the General Land Registration Office.

5. ID.; ID.; ID.; FINALITY OF DECREE. — For a decree to exist in legal contemplation, it is not necessary to
await the preparation of a so-called decree by the Land Registration Office.

6. ID.; ID.; ID.; ID. — Cadastral proceedings commenced. Notice published in the Official Gazette. Trial
judge also issued general notice. S asks for the registration in his name of lot No. 1608. Hearing had. On
September 21, 1916, the court in a decree awarded the lot to S. On November 23, 1916, the time for an
appeal having passed, the court declares the decree final. On July 23, 1917, before the issuance by the Land
Registration Office of the so-called technical decree, V and G ask that the case be reopened to receive proof
relative to the ownership of the lot. Motion denied by the trial court. Held: That since the judgment of the
Court of First Instance of September 21, 1916, has become final, and since no action was taken within the
time provided by law for the prosecution of an appeal by bill of exceptions, the Supreme Court is without
jurisdiction, and the appeal must be dismissed.

7. ID.; ID.; RELIEF FROM JUDGMENT. — Whether Sections 113 and 513 of the Code of Civil Procedure apply
to cadastral proceedings, quare.

8. GENERAL LAND REGISTRATION OFFICE. — The General Land Registration Office has been instituted "for
the due effectuation and accomplishment of the laws relative to the registration of land." (Administrative
Code of 1917, Sec. 174.)

DECISION

MALCOLM, J. :

The principal question which this appeal presents is — When does the registration of title, under the Torrens
System of Land Registration, especially under the different Philippine laws establishing the Cadastral
System, become final, conclusive, and indisputable? The supplementary questions are — At what stage of
the cadastral proceedings does a decree exist in legal contemplation? Does it exist from the moment that
the court, after hearing the evidence, adjudicates the land in favor of a person and then, or later decrees the
land in favor of this person, or does it exist when the Chief of the Land Registration Office transcribes the
adjudication in the prescribed form?

STATEMENT OF THE CASE.

Cadastral proceedings were commenced in the municipality of Hinigaran, Province of Occidental Negros,
upon an application of the Director of Lands, on June 16, 1916. Notice of the proceedings were published in
the Official Gazette as provided by law. The trial judge also issued general notice to all interested parties.
Among others, Victoriano Siguenza presented an answer asking for registration in his name of lot No. 1608.
The instant petitioners, Antipas Vazquez and Basilio Gayares, although said to reside in this municipality,
and although said to have participated in other cadastral cases, did not enter any opposition as to this lot.
Hearing was had during September, 1916. On September 21 of this year, the court issued the following
decree:jgc: chan roble s.com.p h

"It is hereby decreed that, upon a previous declaration of general default, the following lots be adjudged and
registered in the names of those persons whose names appear next after the lots, and in accordance with
the following conditions: . . .

"Lot No. 1608 with the improvements thereon to the conjugal partnership of Victoriano Siguenza and
Marcela Guanzon." cralaw virtua 1aw lib rary

On November 23 of the same year, the court declared final the foregoing decree in the following
language: jgc:chanrobles. com.ph

"The decision rendered by the court in the above-entitled case having become final on September 21, 1916,
it is hereby ordered that the Chief of the General Land Registration Office issue the decrees corresponding to
the lots adjudged by said decision.

"An appeal having however been interposed as to the lots enumerated as follows, the decrees thereon, must
be suspended until further order by this court: jgc:c hanro bles. com.ph

"Lot No. 521.

Eight months later, that is, on July 23, 1917, but before the issuance by the Land Registration Office of the
so-called technical decree, Antipas Vazquez and Basilio Gayares, the latter as guardian of the minor Estrella
Vazquez, came into the case for the first time. The petitioners, after setting forth their right of ownership in
lot No. 1608, and that it was included in their "Hacienda Santa Filomena," and after stating that they were in
complete ignorance of the proceedings, asked that the judgment of the court be annulled and that the case
be reopened to receive proof relative to the ownership of the lot. Counsel for Victoriano Siguenza answered
by counter-motion, asking the court to dismiss the motion presented on behalf of Vazquez and Gayares. The
court denied the motion for a new trial on the theory that there being a decree already rendered and no
allegation of fraud having been made, the court lacked jurisdiction. It may also be stated parenthetically
that counsel for Vazquez and Gayares made an unsuccessful attempt in the Supreme Court, through
mandamus, to have the record completed by the taking of evidence.

In order that the matter may not be confused, let it again be made clear that counsel for petitioners have
not raised the question of fraud as provided for in Section 38 of the Land Registration Law, nor have they
asked to be relieved from a judgment or order, pursuant to Section 113 of the Code of Civil Procedure,
because of mistake, inadvertence, surprise, or excusable neglect. As a matter of fact, they could not well
claim fraud because all the proceedings were public and free from any suspicion of chicanery. As a matter of
fact, also, any special reliance on Section 113 of the Code of Civil Procedure would not get them anywhere
because more than six months had elapsed after the issuance of a judgment in this case. The issue
fundamentally becomes one of whether or not the Supreme Court has jurisdiction over the appeal, since if
the judgment and the supplemental decree issued by the Judge of the Court of First Instance on September
21, 1916, and November 23, 1916, respectively, have become final, petitioners may no bring their appeal
before this court, because the time for the filing of their bill of exceptions has expired; while, if the cadastral
proceedings did not become final until the formal decree was issued by the Land Registration Office, then it
was proper for them to ask for a reopening of the case, and it would, consequently, be just as proper for
this court to order the trial court to permit the same.

OPINION.
The prime purpose of the Torrens System is, as has been repeatedly stated, to decree land titles that shall
be final, irrevocable, and indisputable. Incontestability of title is the goal. All due precaution must
accordingly be taken to guard against injustice to interested individuals who, for some good reason, may not
be able to protect their rights. Nevertheless, even at the cost of possible cruelty which may result in
exceptional cases, it does become necessary in the interest of the public weal to enforce registration laws.
No stronger words can be found than those appearing in Section 38 of the Land Registration Law (Act No.
496) wherein it is said that: "Every decree of registration shall bind the land, and quiet title thereto. . . . It
shall be conclusive upon and against all persons, including the Insular Government and all the branches
thereof, whether mentioned by name in the application, notice, or citation, or included in the general
description ’To all whom it may concern,’ Such decree shall not be opened by reason of the absence,
infancy, or other disability of any person affected thereby, nor by any proceeding in any court for reversing
judgments or decrees; subject, however, to the right of any person deprived of land or of any estate or
interest therein by decree of registration obtained by fraud to file in the Court of Land Registration (Court of
First Instance) a petition for review within one year after entry of the decree, provided no innocent
purchaser for value has acquired an interest." cralaw vi rtua 1aw lib rary

While such statements can be made of the Torrens System proper, they become even more incisive and
peremptory when we come to consider the offspring of this system, here known as the Cadastral System.
Under the Torrens System proper, whether action shall or shall not be taken is optional with the solicitant.
Under the Cadastral System, pursuant to initiative on the part of the Government, titles for all the land
within a stated area, are adjudicated whether or not the people living within this district desire to have titles
issued. The purpose, as stated in section one of the Cadastral Act (NO. 2259), is to serve the public
interests, by requiring that the titles to any lands "be settled and adjudicated."cralaw virt ua1aw lib ra ry

Admitting that such compulsory registration of land and such excessive interference with private property
constitutes due process of law and that the Acts providing for the same are constitutional, a question not
here raised, yet a study of the law indicates that many precautions are taken to guard against injustice. The
proceedings are initiated by a notice of survey. When the lands have been surveyed and plotted, the
Director of Lands, represented by the Attorney General, files a petition in court praying that the titles to the
lands named be settled and adjudicated. Notice of the filing of the petition is then published twice in
successive issues of the Official Gazette in both the English and Spanish languages. All persons interested
are given the benefit of assistance by competent officials and are informed of their rights. A trial is had. "All
conflicting interests shall be adjudicated by the court and decrees awarded in favor of the persons entitled to
the lands or the various parts thereof, and such decrees, when final, shall be the bases of original
certificates of title in favor of said persons." (Act No. 2259, Sec. 11.) Aside from this, the commotion caused
by the survey and a trial affecting ordinarily many people, together with the presence of strangers in the
community, should serve to put all those affected on their guard.

After trial in a cadastral case, three actions are taken. The first adjudicates ownership in favor of one of the
claimants. This constitutes the decision — the judgment — the decree of the court, and speaks in a judicial
manner. The second action is the declaration by the court that the decree is final and its order for the
issuance of the certificates of title by the Chief of the Land Registration Office. Such order is made if within
thirty days from the date of receipt of a copy of the decision no appeal is taken from the decision. This again
is judicial action, although to a less degree than the first.

The third and last action devolves upon the General Land Registration Office. This office has been instituted
"for the due effectuation and accomplishment of the laws relative to the registration of land."
(Administrative Code of 1917, Sec. 174.) An official found in the office, known as the chief surveyor, has as
one of his duties "to prepare final decrees in all adjudicated cases." (Administrative Code of 1917, Sec.
177.) This latter decree contains the technical description of the land and may not be issued until a
considerable time after the promulgation of the judgment. The form for the decree used by the General Land
Registration Office concludes with the words: "Witness, the Honorable (name of the judge), on this the
(date)." The date that is used as authority for the issuance of the decree is the date when, after hearing the
evidence, the trial court decreed the adjudication and registration of the land.

The judgment in a cadastral survey, including the rendition of the decree, is a judicial act. As the law says,
the judicial decree when final is the base of the certificate of title. The issuance of the decree by the Land
Registration Office is ministerial act. The date of the judgment, or more correctly stated, the date on which
the defeated party receives a copy of the decision, begins the running of the time for the interposition of a
motion for a new trial or for the perfection of an appeal to the Supreme Court. The date of the title prepared
by the Chief Surveyor is unimportant, for the adjudication has taken place and all that is left to be
performed is the mere formulation of the technical description. If an unknown individual could wait possibly
years until the day before a surveyor gets around to transcribing a technical description of a piece of land,
the defeated party could just as reasonably expect the same consideration for his appeal. As a matter of
fact, the so-called unknown is a party just as much as the known oppositor for notice is to all the world, and
the decree binds all the world.

Both counsel for petitioners and respondents rely upon the decision of this court in the case of Tambunting
v. Manuel ([1916], 35 Phil.; 699) . That case and the instant case are not the same. In the Tambunting case
the contest was really between two parties each claiming to have a Torrens title; here one party has the title
and the other is seeking to oust him from his fortress. In the Tambunting case the declaration of ownership
but not the decree of registration had issued; here both declaration and decree have issued. The doctrines
announced in the decision in Grey Alba v. De la Cruz ([1910], 17 Phil., 49) relating to general notice and the
indefensibility of land titles under the Torrens system are much more applicable and can, with as much
reason, be applied to the cadastral system.

As a general rule, registration of title under the cadastral system is final, conclusive and indisputable, after
the passage of the thirty-day period allowed for an appeal from the date of receipt by the party of a copy of
the judgment of the court adjudicating ownership without any step having been taken to perfect an appeal.
The prevailing party may then have execution of the judgment as of right and is entitled to the certificate of
title issued by the chief of the Land Registration Office. The exception is the special provision providing for
fraud.

Counsel for appellants and appellees have favored the court with able arguments relative to the applicability
of Sections 113 and 513 of the Code of Civil Procedure to cadastral proceedings. The view we take of the
case would make unprofitable any discussion of this question.

It appearing that the judgment of the Court of First Instance of Occidental Negros of September 21, 1916,
has become final, and that no action was taken within the time provided by law for the prosecution of an
appeal by bill of exceptions, this court is without jurisdiction. Accordingly the appeal is dismissed with costs
against the appellants. So ordered.
 [G.R. No. 123586. August 12, 2004]

SPOUSES BEDER MORANDARTE and MARINA

FEBRERA, petitioners, vs. COURT OF APPEALS, REPUBLIC OF
THE PHILIPPINES, and SPOUSES VIRGINIO B. LACAYA and
NENITA LACAYA, respondents.

DECISION
AUSTRIA-MARTINEZ, J.:

Before us is a petition for review on certiorari under Rule 45 of the Rules

of Court which seeks the reversal of the Decision, dated August 23, 1995, of
[1]

the Court of Appeals (CA for brevity) in CA-G.R. CV No. 36258, affirming the
Decision, dated November 5, 1991, rendered by the Regional Trial Court
(Branch 7), Dipolog City, Zamboanga del Norte (RTC for brevity) in Civil Case
No. 3890, declaring Free Patent No. (IX-8) 785 and Original Certificate of
[2]

Title No. P-21972, in the name of petitioner Beder Morandarte (Morandarte for
brevity), and all its derivative titles, null and void ab initio.
The factual antecedents are as follows:
Morandarte filed an application for free patent, dated December 5, 1972,
before the Bureau of Lands, Dipolog City District Land Office (BOL for
brevity), covering a parcel of land located at Sta. Filomena, Dipolog City with
an area of 4.5499 hectares and described as a portion of Lot 1038 of Dipolog
Cadastre No. 85. [3]

On July 27, 1976, the District Land Officer of the BOL approved the free
patent application of Morandarte and directed the issuance of a free patent in
his favor. Accordingly, Free Patent No. (IX-8) 785 for Lot No. 7, Csd-09-05-
[4]

00078-D was issued in the name of Morandarte. On September 20, 1976, the
Register of Deeds of Zamboanga del Norte issued the corresponding Original
Certificate of Title No. (P-21972) 5954.[5]

Subsequently, Morandarte caused a subdivision survey of the lot, dividing

the same into Lot No. 6781-A, with an area of 13,939 square meters, and Lot
No. 6781-B, with an area of 32,819 square meters. As a result of the
subdivision survey, Transfer Certificates of Title Nos. T-1835 and T-1836
covering Lots 6781-A and 6781-B, respectively, were issued in favor of
Morandarte on May 12, 1980 by the Registry of Deeds of Dipolog City. [6]
 On May 22, 1981, Morandarte and his wife, Marina Febrera, executed a
real estate mortgage over Lot 6781-B, subject of TCT No. 1836, in favor of the
Development Bank of the Philippines, Dipolog City branch (DBP for brevity), in
consideration of a loan in the amount of P52,160.00. [7]

More than ten years after the issuance of the OCT in Morandartes name,
or on March 19, 1987, respondent Republic of the Philippines (Republic for
brevity), represented by the Director of Lands, filed before the RTC a
Complaint for Annulment of Title and Reversion against the Morandarte
spouses, the Register of Deeds of Zamboanga del Norte, the Register of
Deeds of Dipolog City, and DBP, docketed as Civil Case No. 3890. [8]

The Republic alleged that the BOL found that the subject land includes a
portion of the Miputak River which cannot be validly awarded as it is outside
the commerce of man and beyond the authority of the BOL to dispose of. It
claimed that the Morandarte spouses deliberately and intentionally concealed
such fact in the application to ensure approval thereof. Considering that the
Morandarte spouses are guilty of fraud and misrepresentation in the
procurement of their title, the Republic stressed that their title is void.[9]

The Register of Deeds of Dipolog City filed a Motion to Dismiss, dated

April 7, 1987, praying for the dismissal of the complaint as against her since
the complaint failed to state a claim against her.
[10]

In their Answer dated April 13, 1987, the Morandarte spouses denied the
allegations of the complaint and claimed that they were able to secure the title
in accordance and in compliance with the requirements of the law. They
alleged that the land is a portion of inherited property from Antonio L.
Morandarte whose ownership thereof is covered by Tax Declaration No. 2296.
As regards the Miputak River, they argued that the river changed its
course brought about by the fact that a portion of the Miputak River was
leased by the Bureau of Fisheries (BOF for brevity) to a certain Aguido
Realiza whose rights were subsequently transferred to Virginio Lacaya. They
alleged that they indicated in their survey plan the actual location of the
Miputak River in relation to the property but the BOL returned the survey with
the directive that the existence of the river should not be indicated as the
original survey did not show its existence, to which they complied with by
submitting a new survey plan which did not indicate the existence of the river.
In the alternative, they alleged that inclusion of the Miputak River should
not render the title void; only the portion of the property covered by the
Miputak River should be nullified but their title to the remaining portion should
be maintained. [11]
 For its part, DBP filed its Answer dated April 13, 1987 praying for the
dismissal of the complaint as against it since it had nothing to do with the
issuance of the title to the spouses. DBP interposed a cross-claim against
[12]

the spouses for the payment of their outstanding obligations. The [13]

Morandarte spouses filed an Answer to the Crossclaim dated April 29, 1987. [14]

No answer was filed by the Register of Deeds of Zamboanga del Norte.

On March 4, 1988, upon prior leave of court, herein respondent spouses
Virginio B. Lacaya and Nenita Lacaya filed their Complaint-In-Intervention
which alleged that they are holders of a fishpond lease agreement covering a
fishpond area of about 5.0335 hectares, 1.2681 hectares of which have been
included in the title issued to the Morandarte spouses. Considering that the
land of the Morandarte spouses encroaches on the area leased to them, the
Lacaya spouses submit that the formers title thereto is void. [15]

In their Answer to the complaint-in-intervention, dated March 19, 1988, the

Morandarte spouses denied the allegations of the Lacaya spouses. They [16]

maintained that the portion of the fishpond originally belonged to Antonio L.

Morandarte, their predecessor-in-interest, and the Lacaya spouses have
never been in possession thereof but are actually squatters therein.
On the other hand, the Republic, in its Answer to the complaint-in-
intervention, dated March 21, 1988, adopted the allegations of the complaint-
in-intervention to further support its claim that the title of the Morandarte
spouses is void. The Lacaya spouses filed their Reply and Answer on March
[17]

30, 1988, denying the arguments of the Morandarte spouses and reiterating
the allegations in their complaint-in-intervention.
[18]

Following trial on the merits, on November 5, 1992, the RTC rendered a

Decision in favor of the Republic and the Lacaya spouses. The RTC
[19]

declared that while fraud in the procurement of the title was not established by
the State, Morandartes title is, nonetheless, void because it includes a portion
of the Miputak River which is outside the commerce of man and beyond the
authority of the BOL to dispose of. In addition, the RTC sustained the fishpond
rights of the Lacaya spouses over a portion included in Morandartes title
based on a Deed of Transfer of Fishpond Rights from Felipe B. Lacaya and a
Fishpond Lease Agreement with the BOF.
The dispositive portion of the decision of the trial court reads:

WHEREFORE, judgment is hereby rendered:

 1. Declaring null and void ab initio Free Patent No. (IX-5) (sic) 785 and
Original Certificate of Title No. P-21972 in the name of Beder
Morandarte, as well as all derivative titles issued thereafter;

2. Ordering defendants spouses Beder Morandarte and Marina Febrera to

surrender their owners duplicate copies of Transfer Certificate of Title
Nos. T-1835 and T-1836, which were the derivative titles of Original
Certificate of Title No. P-21972;

3. Directing the Register of Deeds of Zamboanga del Norte to cancel Original

Certificate of Title No. P-21972 in the name of Beder Morandarte, and the
Register of Deeds of Dipolog City to cancel Transfer Certificate of Title
Nos. T-1835 and T-1836 in the name of the same defendant;

4. Ordering the reversion of the land in question to the state, free from liens
and encumbrances;

5. Enjoining defendants spouses Beder Morandarte and Marina Febrera from

exercising any act of ownership or possession of the subject property;

6. Dismissing the Cross-Claim of defendant Development Bank of the

Philippines against Cross Defendants Spouses Beder Morandarte and
Marina Febrera, for being premature, but ordering the latter cross
defendants to give a substitute security in favor of DBP as indicated in this
decision;

7. Declaring valid and enforceable the Lease Agreement for a period of

twenty five years over the fishpond area of Intervenors;

8. Denying Intervenors prayer for damages against defendants-spouses

Morandarte; and

9. Dismissing, for lack of merit, the counterclaim and prayer for damages of
defendants spouses Morandarte against the Intervenors.

No costs against defendant-spouses Morandarte.

IT IS SO ORDERED. [20]

Dissatisfied, the Morandarte spouses appealed to the CA. In a Decision [21]

dated August 23, 1995, the CA affirmed the decision of the

RTC, ratiocinating, as follows:
[22]
The present controversial Miputak River used to occupy the area adjacent to the
northern and western boundaries of Lot No. 6781 Cad-85 (Exh. J). As time passed, it
changed its course and occupies (sic) Lot No. 6781 Cad-85 (identical to Lot 7, Exh.
H). This will explain Beder Morandartes argument that when he applied for the Sales
Patent Lot 7 (identical to Lot 6781), the original technical description did not show
the Miputak River. But it is inescapable though, that while originally, Lot 6781 is not
occupied by the river, at the time that the Sales Application was filed by Beder
Morandarte, the Miputak River was actually occupying said Lot 6781 or Lot 7
covered by his Sales Application and the titles sought to be annulled in this case.

Rivers and their natural beds are undoubtedly properties of public dominion (Art. 502
par. 1, Civil Code of the Philippines). Whether navigable or not, rivers belong to the
public and cannot be acquired by prescription (Com vs. Meneses, 38 O.G. 2839,
Paras, Civil Code, p. 328, Vol. II, 12th Edition). In fact, a stream located within private
land is still property of public dominion, even if the Torrens Title of the land does not
show the existence of said stream (Talion vs. Sec. of Public Works and Highways, L-
24281, May 16, 1967; Paras, supra).

Correspondingly, Art. 462 of the same Civil Code provides:

Art. 462. Whenever a river, changing its course by natural causes, opens a new bed
through a private estate, this bed shall become of public dominion.

The rule is the same that even if the new bed is on private property. The bed becomes
property of public dominion. Just as the old bed had been of public dominion before
the abandonment, the new riverbed shall likewise be of public dominion (Hilario vs.
City of Manila, L-19570, April 27, 1967). [23]

On October 10, 1995, the Morandarte spouses filed a motion for

reconsideration. In its Resolution dated January 19, 1996, the CA found no
[24]

justifiable cause or reason to modify or reverse its decision. [25]

Hence, the instant petition for review anchored on the following assigned
errors:
A.

RESPONDENT COURT COMMITTED A GRAVE ERROR OF LAW IN

APPLYING ARTICLE 462 OF THE CIVIL CODE TO THIS CASE WHEN THE
CHANGE IN COURSE OF THE OLD MIPUTAK RIVER WAS NOT DUE TO
NATURAL CAUSES BUT WAS ACCIDENTAL.

B.
ASSUMING ARGUENDO THAT THE CHANGE OF COURSE OF THE OLD
MIPUTAK RIVER WAS DUE TO NATURAL CAUSE ONLY A PORTION OF
THE SUBJECT PROPERTY OF PETITIONERS WAS AFFECTED THEREBY SO
THAT THE TITLE OF PETITIONERS TO THE REMAINING PORTION IS
VALID AND CANNOT BE NULLIFIED AS IT REMAINED PRIVATE
PROPERTY.

C.

RESPONDENT COURT GRAVELY ERRED IN ORDERING THE REVERSION

OF LOT 7, CSD-09-05-00078-D TO THE PUBLIC DOMAIN.

D.

RESPONDENT COURT GRAVELY ERRED IN NOT DECLARING AS NULL

AND VOID THE LEASE AGREEMENT EXECUTED IN FAVOR OF
INTERVENORS.

E.

RESPONDENT COURT GRAVELY ERRED IN NOT DISMISSING THE

COMPLAINT CONSIDERING THAT NO FRAUD OR MISREPRESENTATION
WAS EMPLOYED BY THE SPOUSES MORANDARTE IN OBTAINING THE
TITLE.[26]

The Morandarte spouses emphatically argue that the CA failed to take into
consideration the true state of the present Miputak River in relation to Lot 7.
They contend that the Miputak River changed its course due to the closure of
the river bed through the construction of dikes by the Lacaya spouses, forcing
the river to be diverted into Lot 6781-B. Thus, they submit that the applicable
provision is Article 77 of the Law of Waters, which provides that [l]ands
accidentally inundated by the waters of lakes, or by creeks, rivers and other
streams shall continue to be the property of their respective owners.
Furthermore, they staunchly claim that the Miputak River does not actually
correspond to Lot 7. The Miputak River occupies only 12,162 square meters
of Lot 7 which has an area of 45,499 square meters. Also, they insist that the
lower courts made capital, albeit erroneously, of their agreement to a
reversion. The reversion agreed to refers only to the 12,162 square meters
portion covered by the Miputak River, which should be voided, while the
portion unaffected by the Miputak River is valid and their title thereto should
be maintained and respected.
 Moreover, they vigorously contend that the CA erred in sustaining the
validity of fishpond rights of the Lacaya spouses. They aver that the Lacaya
spouses violated the terms of the lease agreement by constructing dikes for
the fishponds which caused the Miputak River to traverse the property of the
Morandarte spouses.
Prefatorily, it must be stated that in petitions for review on certiorari, only
questions of law may be raised by the parties and passed upon by this
Court. Factual findings of the trial court, when adopted and confirmed by the
[27]

CA, are binding and conclusive upon the Supreme Court and generally will not
be reviewed on appeal. Inquiry upon the veracity of the CAs factual findings
[28]

and conclusion is not the function of the Supreme Court for the Court is not a
trier of facts.
[29]

While this Court has recognized several exceptions to this rule, to wit: (1)
when the findings are grounded entirely on speculation, surmises, or
conjectures; (2) when the inference made is manifestly mistaken, absurd, or
impossible; (3) when there is grave abuse of discretion; (4) when the
judgment is based on a misapprehension of facts; (5) when the findings of
facts are conflicting; (6) when in making its findings, the CA went beyond the
issues of the case, or its findings are contrary to the admissions of both the
appellant and the appellee; (7) when the findings are contrary to the trial court;
(8) when the findings are conclusions without citation of specific evidence on
which they are based; (9) when the facts set forth in the petition as well as in
the petitioners main and reply briefs are not disputed by the respondent; (10)
when the findings of fact are premised on the supposed absence of evidence
and contradicted by the evidence on record; and (11) when the CA manifestly
overlooked certain relevant facts not disputed by the parties, which, if properly
considered, would justify a different conclusion, none of these exceptions
[30]

find application here.

A complaint for reversion involves a serious controversy, involving a
question of fraud and misrepresentation committed against the government
and it seeks the return of the disputed portion of the public domain. It seeks to
cancel the original certificate of registration, and nullify the original certificate
of title, including the transfer certificate of title of the successors-in-interest
because the same were all procured through fraud and misrepresentation. [31]

The State, as the party alleging that fraud and misrepresentation attended
the application for free patent, bears the burden of proof. The circumstances
evidencing fraud and misrepresentation are as varied as the people who
perpetrate it in each case. It assumes different shapes and forms and may be
committed in as many different ways. Therefore, fraud and
[32]
misrepresentation are never presumed but must be proved by clear and
convincing evidence; mere preponderance of evidence not even being
[33]

adequate. [34]

In this case, the State failed to prove that fraud and misrepresentation
attended the application for free patent. The RTC, in fact, recognized that no
fraud attended the application for free patent but declared reversion based
[35]

on the judicial admission of the Morandarte spouses that reversion is

warranted due to the inalienability of the Miputak River. Ordinarily, a judicial
admission requires no proof and a party is precluded from denying it except
when it is shown that such admission was made through palpable mistake or
that no such admission was made. In this case, the exception finds
[36]

application since the records lay bare that such admission was made through
mistake and not in the context it was considered. As reflected in the Order
dated May 25, 1998, the Morandarte spouses essentially agreed only to a
[37]

reconveyance of the portion covering the Miputak River. Undoubtedly, such

acquiescence to return the portion covering the Miputak River is not, and
cannot be considered, an admission that fraud and misrepresentation
attended the application for free patent. This fact, standing alone, does not
prove fraud and misrepresentation.
Besides, it is undisputed that the original survey plan submitted by
Morandarte to the BOL reflected the true state of the Miputak River in Lot
1038 but the BOL did not approve the plan because a 1916 survey did not so
indicate the existence of a river traversing Lot 1038 such that Morandarte was
directed to submit an amended plan deleting the existence of the Miputak
River. This mothered the subsequent error of the BOL of approving the
amended plan as CAS-09-05-000078-D.
This error could have been discovered through a thorough ocular
inspection of the property claimed under the free patent application. However,
Aurelio F. Bureros, Hearing Officer I of the BOL, surprisingly failed to notice
the existence of the river traversing Lot 1038 in the field investigation he
conducted on January 10, 1976. [38]

Neither did Bureros note the 13,339 square meter portion already covered
by an existing fishpond lease agreement granted by the BOF in favor of Felipe
B. Lacaya, the predecessor-in-interest of the Lacaya spouses. [39]

The records reveal that as early as 1948, 4.6784 hectares of the public [40]

land have been leased for fishpond purposes. Aguido S. Realiza was the
initial grantee of a fishpond lease agreement. Amor A. Realiza, Aguidos son,
[41]

acquired his fishpond permit on May 29, 1953. Amor A. Realiza transferred
[42]

his fishpond rights to Felipe B. Lacaya on May 14, 1956. By 1960, the public
[43]
land leased for fishpond purposes had increased to 5.0335 hectares. Felipe [44]

B. Lacaya transferred his fishpond rights to Virgilio B. Lacaya on October 25,

1977. Thus, the fishpond rights have been in existence since 1948, prior to
[45]

the 1972 free patent application of Morandarte.

Regardless of the foregoing, Aurelio F. Bureros, concluded that
Morandarte is a qualified applicant and recommended that a free patent be
granted to him. This error culminated in the erroneous grant of a free patent
on July 27, 1976 covering the Miputak River and land subject of the fishpond
rights of Felipe B. Lacaya.[46]

Be that as it may, the mistake or error of the officials or agents of the BOL
in this regard cannot be invoked against the government with regard to
property of the public domain. It has been said that the State cannot be
estopped by the omission, mistake or error of its officials or agents.[47]

It is well-recognized that if a person obtains a title under the Public Land

Act which includes, by oversight, lands which cannot be registered under the
Torrens system, or when the Director of Lands did not have jurisdiction over
the same because it is a public domain, the grantee does not, by virtue of the
said certificate of title alone, become the owner of the land or property illegally
included. Otherwise stated, property of the public domain is incapable of
[48]

registration and its inclusion in a title nullifies that title.

[49]

The present controversy involves a portion of the public domain that was
merely erroneously included in the free patent. A different rule would apply
where fraud is convincingly shown. The absence of clear evidence of fraud
will not invalidate the entire title of the Morandarte spouses.
Accordingly, the 12,162-square meter portion traversed by the Miputak
River and the 13,339-square meter portion covered by the fishpond lease
agreement of the Lacaya spouses which were erroneously included in Free
Patent No. (IX-8) 785 and Original Certificate of Title No. P-21972 should be
reconveyed back to the State.
The Morandarte spouses cannot seek refuge in their claim that Antonio A.
Morandarte, their predecessor-in-interest, was already the owner of that
portion of Lot 1038 when the fishpond application of Aguido S. Realiza was
approved in 1948 because Lot 1038 was still part of the public domain then. It
was only in 1972, through Forestry Administrative Order No. 4-1257, which
was approved August 14, 1972, when Lot 1038 was declared alienable or
disposable property of the State. [50]

It is a settled rule that unless a public land is shown to have been

reclassified as alienable or actually alienated by the State to a private person,
that piece of land remains part of the public domain. Hence, Antonio A.
Morandartes occupation thereof, however long, cannot ripen into private
ownership. [51]

The Morandarte spouses also unsuccessfully harp on the inapplicability of

Article 462 of the Civil Code by claiming that the change of course of the
Miputak River was due to a man-made cause and not by natural means. They
offered no iota of evidence to substantiate this claim, other than the bare
testimony of Beder Morandarte. Neither is there proof that the movement of
the river was caused by accident or calamity, such as a typhoon, and not by
the natural movements thereof. General statements, which are mere
conclusions of law and not proofs, are unavailing and cannot suffice.
Besides, at the time of the filing of the application for free patent in 1972, a
portion of the Miputak River was already in its present course, traversing Lot
1038, particularly Lot 7 of the amended plan submitted by Morandarte.
We need not delve on the question of whether the Lacaya spouses
violated the terms of the fishpond lease agreement. It is not material in this
case in the sense that it was not made an issue by the parties. Neither is there
evidence to corroborate the bare allegation of petitioners that the Lacaya
spouses constructed dikes for the fishponds which caused the Miputak River
to traverse Lot 7. What is significant here is the established fact that there was
an existing fishpond lease agreement between Felipe Lacaya and the Bureau
of Fisheries at the time of Morandartes application for free patent; in effect,
proving that the area covering the fishpond belongs to the Government and
petitioners have no rights thereto.
In closing, we cannot but decry the carelessness of the BOL in having
issued the Free Patent in Morandartes favor which covered the Miputak River
and the fishpond rights of Felipe B. Lacaya. Surely, a more diligent search into
their records and thorough ocular inspection of Lot 7 would have revealed the
presence of the Miputak River traversing therein and an existing fishpond right
thereon. Had more vigilance been exercised by the BOL, the government
agency entrusted specifically with the task of administering and disposing of
public lands, the present litigation could have been averted.
WHEREFORE, the petition is partly GRANTED. The assailed Decision of
the Court of Appeals, dated August 23, 1995, in CA G.R. No. 36258 is
REVERSED insofar only as it affirmed the nullity of Free Patent No. (IX-8) 785
and Original Certificate of Title No. P-21972, in the name of petitioner Beder
Morandarte. In its stead, petitioners Spouses Beder Morandarte and Marina
Febrera are directed to reconvey to the respondent Republic of the Philippines
within thirty (30) days from the finality of this Decision the 12,162-square
meter portion traversed by the Miputak River and the 13,339-square meter
portion covered by the fishpond lease agreement of the Lacaya