G.R. No.

133547 February 10, 2000

HEIRS OF ANTONIO PAEL and ANDREA
ALCANTARA and CRISANTO
PAEL, petitioners,
vs.
COURT OF APPEALS, JORGE H. CHIN and
RENATO B. MALLARI, respondents.
x-----------------------------x
G.R. No. 133483 February 10, 2000
MARIA DESTURA, petitioner,
vs.
COURT OF APPEALS, JORGE H. CHIN and
RENATO B. MALLARI, respondents.
LUIS M. MENOR, intervenor
YNARES-SANTIAGO, J .:
These are separate petitions for review assailing
the Decision dated April 29, 1998 of the Court of
Appeals in CA-G.R. SP No. 45425.
1
The two
petitions were ordered consolidated by this
Court on August 16, 1999.
2

This case has its beginnings in a complaint filed
by Maria Destura on December 9, 1993 against
herein private respondents Jorge H. Chin,
Renato B. Mallari and plaintiff's own husband,
Pedro Destura. The complaint was docketed as
Civil Case No. Q-93-18569 of the Regional Trial
Court of Quezon City, Branch 96.
3

About year earlier, on January 20, 1993, the
husband, Pedro Destura, had filed a
substantially similar complaint against the same
defendants, respondents Chin and Mallari. The
complaint against Jorge H. Chin and Renato B.
Mallari, for annulment of title, reconveyance and
specific performance, damages and nullification
of the Memorandum of Agreement, was
docketed as Civil Case No. Q-93-14522 of the
Regional Trial Court of Quezon City, Branch 99.
The above-stated Memorandum of Agreement
(MOA) dated March 26, 1992 was among Chin
and Mallari, as first parties; Pedro Destura, as
second party; and a certain Jaime B. Lumasag,
Jr., as third party, whereby the parties agreed to
sell the property subject of this petition to an
interested buyer and to share in the proceeds,
with Lumasag acting as broker of the sale.
However, the prospective buyer of Lumasag
backed out and the sale did not materialize.
Upon defendants Chin and Mallari's motion, on
November 5, 1993, the trial court issued an
Order dismissing the complaint for lack of cause
of action.
Pedro Destura then appealed to the Court of
Appeals. On December 10, 1996, the Court of
Appeals' Twelfth Division affirmed the order of
dismissal.
4
The Court of Appeals not only
declared the MOA as valid, it also upheld the
titles of Chin and Mallari by expressly declaring
that they have a better title to the property. This
decision has long been final and executory per
entry of judgment.
Inspite of the decision against her husband,
Maria Destura filed a similar action one month
after the decision, docketed as Civil Case No. Q-
93-18569 of the Regional Trial Court of Quezon
City, Branch 96.
5
As stated, the Court of Appeals
affirmed the dismissal by the Regional Trial
Court of Pedro Destura's complaint for lack of
cause of action. In an obvious attempt to avoid
application of res judicata or litis
pendentia doctrine, Maria impleaded her own
husband as a defendant. Significantly, after the
complaint was filed, Maria dropped Pedro
Destura as a party-defendant, alleging that the
two had amicably settled their differences.
In her complaint, Maria Destura averred that on
May 22, 1979, she and Pedro purchased from
Crisanto Pael, through attorney-in-fact Lutgarda
Marilao, a tract of land consisting of 77.9477
hectares, situated in Barrio Culiat, Quezon City
and covered by Transfer Certificate of Title No.
36048 in the name of "Antonio Pael y Andria
Alcantara, conyuges, y Crisanto Pael, hijo." The
owner's duplicate of title and approved survey
plan were allegedly delivered to Pedro but he
misplaced them, and he suspected that they
were taken from his office by a certain Luis
Menor. Inasmuch as title to the land was still in
the name of the Paels, Pedro caused the
execution of an extrajudicial settlement of the
estate of the deceased spouses Antonio Pael
and Andria Alcantara with sale of real property,
as well as an affidavit of self-
adjudication.1wphi1.nt
Thereafter, with the intention of disposing of the
property, Pedro allegedly executed a special
power of attorney to sell in favor of Renato
Mallari and Jorge Chin. The latter failed to sell
the property, whereupon Pedro executed a deed
of conditional sale in favor of Chin, but the sale
was allegedly not consummated due to Chin's
non-compliance with certain conditions. Pedro
thereafter went to Canada and, when he
returned, he allegedly discovered that the title to
the property had been transferred in the names
of Chin and Mallari, as TCT Nos. 52928
6
and
52929
7
.
When Pedro was about to prosecute Chin and
Mallari, the latter allegedly offered to settle their
dispute. This resulted in the execution of the
MOA sought to be nullified in both the
complaints of Pedro and Maria.
On January 24, 1995, the trial court in the Maria
Destura case, presided by Judge Lucas
Bersamin, rendered a decision based on default,
the dispositive portion of which reads:
WHEREFORE, in view of the foregoing
considerations, judgment is hereby
rendered:
1. Nullifying the memorandum of
agreement dated March 26, 1992;
2. Ordering the defendant Register of
Deeds of Quezon City to cancel
Transfer Certificate of Title Nos. 52928
and 52929 in the names of Jorge Chin
and Renato Mallari and the transfer
certificates of title from which said
certificates were derived until but not
including Transfer Certificate of Title No.
36048 and thereafter to reinstate
Transfer Certificate of Title No. 36048 in
the names of Spouses Antonio Pael and
Andrea Alcantara and Crisanto Pael;
and
3. Sentencing the defendants to pay
costs of suit.
The cause of action for damages is
hereby dismissed for lack of evidence.
SO ORDERED.
The above-quoted decision of Civil Case No. Q-
93-18569 was rendered after Chin and Mallari
were declared in default for failure to answer the
complaint. Thus, judgment by default was issued
nullifying of the MOA and ordering the
cancellation of Chin's and Mallari's TCT Nos.
52928 and 52929. Surprisingly, the trial court did
not award any affirmative relief of the plaintiff
therein, Maria Destura. Instead, the trial court
ordered the reinstatement of TCT No. 36048 in
the names of the Paels, who were non-parties in
the case. In fact, petitioners, heirs of the Paels,
were not impleaded in the case below, did not
intervene, and were non-parties in every sense
of the word. These notwithstanding, valuable
property was awarded to them.
Maria Destura did not appeal the trial court's
decision. It, therefore, became final insofar as it
awarded titles to non-parties and declined to
grant any of the prayers of the plaintiff therein.
Inspite of the finality of the decision as against
her, Maria Destura surprisingly came in as
intervenor on the later stage of this petition
before this Court.
Maria raised matters that are more proper for
her lost appeal and not in a last minute
intervention in the Supreme Court.
On February 13, 1995, Atty. Oliver O. Lozano,
counsel for respondents Chin and Mallari, filed a
notice of appeal,
8
which was approved by the
trial court and given due course.
9
Later, on
February 21, 1995, Atty. Lozano filed a Motion
for New Trial,
10
alleging that his clients' failure to
answer was due to honest mistake and that they
have a good and valid defense. Atty. Lozano's
notice of appeal did not state when the notice of
the decision was received by the appellants.
On February 14, 1995, the trial court approved
the notice of appeal and directed the forwarding
of the records to the Court of Appeals.
On March 3, 1995, Atty. Lozano filed a
supplemental motion.
11

On March 7, 1995, Maria Destura filed a motion
to dismiss the motion and supplemental motion
for new trial.
12

On April 11, 1995, respondents Chin and
Mallari, through new counsel Atty. Ponciano H.
Gupit, filed an Omnibus Motion
13
alleging that
their sad plight to present on time their side of
the controversy was due to the censurable
negligence of their counsel, Atty. Lozano, whose
services they had engaged to file their answer.
On August 28, 1995, the trial court issued an
Order, the dispositive portion of which reads:
WHEREFORE, in view of the foregoing:
1. The motion for new trial,
supplemental motion, and omnibus
motion, all filed by the defendants, are
hereby denied for lack of merit;
2. The appeal allowed in the Order of
February 14, 1995 is hereby considered
abandoned and is accordingly
dismissed; and
3. The decision dated January 24, 1995
is hereby declared to be final and
executory.
SO ORDERED.
14

From the adverse decision and order of the trial
court, private respondents filed a petition for
annulment of judgment before the Court of
Appeals, which required the respondents named
therein to comment on the petition.
In the meantime, one Letty Sy, claiming to have
legal, direct and material interest in the matter in
litigation and having learned that Maria Destura
will not file her comment on the petition, filed on
October 22, 1997 a "Motion for Leave to
Substitute Party Respondent With Prayer that
She be Allowed to File Comment on the Petition
for Annulment of Judgment Within a Reasonable
Period of Time".
15
Private respondents opposed
this motion on November 26, 1997. The Court of
Appeals, in its Resolution dated January 8,
1998, denied Letty Sy's motion.
16

Previously, on November 17, 1997, Maria
Destura decided to file her comment and
opposition to the petition,
17
to which respondents
Chin and Mallari filed a vigorous reply dated
December 1, 1997.
18

On the other hand, the heirs of Antonio Pael
filed a motion for extension to file comment on
the petition. On October 29, 1997, Roberto Pael,
as administrator of the estate of the Paels, filed
a short comment. Because the titles of private
respondents Chin and Mallari were cancelled by
the trial court not on substantial grounds but on
their alleged default and abandonment of their
case compounded by various unusual
procedural errors, the Court of Appeals passed
upon the issue of the intrinsic validity of the
disputed land titles.
On April 29, 1998, the Court of Appeals
rendered the assailed decision, the dispositive
portion of which reads:
WHEREFORE, premises considered,
the decision dated January 24, 1995
and the Order dated August 28, 1995,
both issued in Civil Case No. Q-93-
18569, are hereby ANNULLED and SET
ASIDE, and accordingly, judgment is
issued:
a) DECLARING as valid the
memorandum of agreement dated
March 26, 1992;
b) DECLARING as null and void both
the calcellation of the titles, Transfer
Certificates of Title Nos. 52928 and
52929 of petitioners Jorge H. Chin and
Renato B. Mallari over the subject
property and reinstatement of the title
Transfer Certificate No. 36048, in the
names of Antonio Pael, Andrea
Alcantara and Crisanto Pael;
c) DECLARING the petitioners as the
true and absolute owners of the subject
property and ORDERING the Register
of Deeds of Quezon City to REINSTATE
the aforementioned titles, TCT Nos.
52928 and 52929 in favor of petitioners
Jorge H. Chin and Renato B. Mallari;
d) DIRECTING Sheriff Mr. Jose G.
Martinez of the trial court, or whoever
has taken his place, to surrender
forthwith the owner's duplicate copy
(original) of TCT No. 36048 to the
Register of Deeds of Quezon City within
ten (10) days from finality of` this
decision.
In the event that Sheriff Martinez or his
replacement fails to surrender the said
original owner's duplicate copy of TCT
No. 36048 within the said ten (10) day
period, the Register of Deeds of Quezon
City is hereby directed to CANCEL the
said title, TCT No. 36048, and to
EFFECT forthwith the reinstatement of
the titles, TCT Nos. 52928 and 52929 in
the names of Chin and Mallari.
e) DENYING the petitions-in-
intervention of Letty Sy and PFINA
Properties, Inc. Motion for
Reconsideration for lack of merit; and
f) DENYING the prayer for damages
sought for by petitioners, not having
been proven by a preponderance of
evidence.
No pronouncement as to costs.
SO ORDERED.
19

While the petition for annulment was pending
before the Court of Appeals, or on January 28,
1998, a certain corporation called PFINA
Properties, Inc. (PFINA, for brevity) filed a
motion for leave of court to intervene and to
admit petition-in-intervention. It alleged that
PFINA acquired the property subject of the
litigation for substantial and valuable
consideration from Roberto A. Pael and the
Heirs of Antonio Pael, Andrea Alcantara and
Crisanto Pael, by virtue of a deed of assignment
dated January 25, 1983, and that the title was
issued in its name by the Register of Deeds of
Quezon City. This motion was opposed by
private respondents. They cite the fact that the
alleged acquisition of the property by PFINA
supposedly occurred as early as January 25,
1983, and for fifteen (15) years, inspite of
numerous proceedings before different courts
and agencies involving the disputed property,
both the Paels and PFINA were silent about the
alleged change of ownership. No steps to
register the sale or secure transfer titles were
undertaken during this period.
Private respondents filed an Omnibus Motion for
the cancellation and declaration as null and void
of the title illegally obtained by PFINA in its
name and to hold the officials of PFINA, their
counsel, and the Register of Deeds of Quezon
City in contempt of court. The grounds for the
Omnibus Motion are as follows:
Private respondents caused on October
8, 1997 the annotation of the Petition for
Annulment of Judgment with the
Registry of Deeds of Quezon City which
was granted.
The manner and the haste and the
speed by which the new title, TCT No.
186662, was issued in the name of
PFINA Properties, Inc. was surreptitious
and condemnable.
The new title was obtained by PFINA
despite its knowledge that there was a
pending case for annulment before the
appellate court.
Atty. Samuel C. Cleofe, the Register of
Deeds of Quezon City who cancelled
the title, TCT No. 36048 in the names of
Antonio Pael and Andrea Alcantara and
Crisanto Pael, and issued the new title
in the name of PFINA acted in gross
and evident bad faith. Not only was the
Register a party respondent fully
knowledgeable and served with all
processes in the annulment case, but
the petition before the appellate court
was also annotated at the back of the
title of the Paels, TCT No. 36048 and
Entry No. PE-5702-06-T-(36048) the
Court of Appeals' decision dated
December 10, 1996 allowing them to
conduct a verification and relocation
survey and the Entry of Judgment
issued by the Court of Appeals dated
March 4, 1997. The date of the
inscription is May 7, 1997.
The Register of Deeds also knew that
the instant case was pending before the
appellate court. In cancelling the title of
the Paels, TCT No. 36048, and issuing
a new title, TCT No. 186662 in favor of
PFINA, Cleofe disturbed the
proceedings in the appellate court,
degraded the administration of justice
and should be held in contempt.
Register of Deeds Cleofe was not
merely discharging a ministerial duty
because he was a party to the case
before the appellate court and was
aware and familiar with the proceedings
and developments in this case.
Only after a period of fifteen (15) years
did PFINA come forward to present the
deed and claim the subject properties.
The said deed and the circumstances
surrounding its issuance are suspect.
The deed may be fabricated and the
signatures of the parties and witnesses
forged.
The issuance of the new title was
attended with irregularities. Before a
new title is issued in favor of a party, all
the required taxes should have been
paid. In the instant case, there is no
valid proof that the capital gains tax, the
real estate taxes and the transfer taxes
have been fully paid. Documents
alleging payment of taxes were
introduced but verification and
certification from the Assessor's Office,
the Treasurer's Office and the Bureau of
Internal Revenue of Quezon City show
that these offices have not actually
received the amounts indicated.
The Court of Appeals gave credence to the
objections interposed by private respondents. In
its Resolution dated February 25, 1998, it cited
badges or indicia of fraud in the alleged
acquisition of the property by PFINA as well as
the cancellation of the title of the Paels and
issuance of a new title in favor of PFINA.
On the basis of the pleadings of the parties, as
well as the records elevated, the appellate court
rendered judgment in favor of private
respondents.
Dissatisfied, petitioners in both cases filed
separate petitions before this Court. As earlier
stated, upon motion of petitioners in G.R. No.
133547, said case was consolidated with G.R.
No. 133843.
On July 31, 1998, during the pendency of the
petition in G.R. No. 133547, Roberto Pael, being
the administrator of the estate of Antonio Pael,
Andrea Alcantara and Crisanto Pael, filed a
"Manipestasyon"
20
dated July 21, 1998 worded
in the Pilipino dialect, withdrawing the petition for
review in G.R. No. 133547 and stating among
others:
1. That he confirms the decision of the
Court of Appeals in favor of Jorge Chin
and Renato Mallari;
2. That he recognizes the ownership of
Jorge Chin and Renato Mallari over the
subject properties covered by TCT Nos.
52928 and 52929 of the Registry of
Deeds of Quezon City.
This "Manipestasyon" was subscribed under
oath by Administrator Roberto Pael before Atty.
Josefina Ma. S. Castro, Branch Clerk of Court,
Regional Trial Court, Branch 99, Quezon City.
21

Surprisingly, on July 30, 1998, or a day before
he filed his aforementioned "Manipestasyon",
Mr. Roberto Pael also filed a
"Manifestation",
22
couched in English, in effect
retracting his statements in his "Manipestasyon",
and stating that he has not withdrawn the
petition he filed before this Court.
On September 3, 1998, private respondents filed
the required comment on the petition.
23

On September 23, 1998, Mr. Roberto Pael,
again in his capacity as Administrator of the Pael
Estate and as representative of the heirs of
Antonio Pael and Andrea Alcantara and Crisanto
Pael, withdrew the petition and filed a "Motion at
Manipestasyon"
24
dated September 22, 1998,
praying that his withdrawal of the "Motion to
Withdraw Appeal" dated July 30, 1998 be
deleted from the records of this case and that
his "Manipestasyon" dated July 31, 1998 be
recognized and respected. This "Motion at
Manipestasyon" was this time subscribed under
oath by Mr. Pael before Atty. Enriqueta
Esguerra-Vidal, the Assistant Division Clerk of
the First Division of the Supreme Court.
25

In his "Motion at Manipestasyon", Mr. Pael
reiterated his previous statements in his earlier
"Manipestasyon", to wit:
1. That he is really and actually
withdrawing the petition filed in behalf of
the Heirs of Antonio Pael and Andrea
Alcantara and Crisanto Pael;
2. That he really and actually confirms
the decision of the Court of Appeals in
favor of private respondents;
3. That he really and actually recognizes
the ownership of private respondents
over the subject property covered by
TCT Nos. 52928 and 52929 of the
Registry of Deeds of Quezon City.
On October 5, 1998, this Court issued a
Resolution granting the manifestation and
motion dated September 22, 1998 of Mr. Pael,
and considered this case "CLOSED and
TERMINATED".
26
The full text of this Resolution
reads as follows:
G.R. No. 133547 (Heirs of Antonio
Pael, et al., vs. Hon. Lucas P. Bersamin,
etc., et al.). The Court resolved to:
(a) GRANT the motion of petitioners for
an extension of ten (10) days or until
September 28, 1998 within which to file
a comment on the opposition of private
respondents to petitioners' motion for
extension of time to file a petition for
review on certiorari;
(b) NOTE the said comment thereafter
filed; and
(c) NOTE and GRANT the manifestation
and motion dated September 22, 1998
of Roberto Pael, petitioner/administrator
of the estate of Antonio Pael, Andrea
Alcantara and Crisanto Pael, praying
that the withdrawal of the motion to
withdraw appeal be deleted from the
records of the case and the
manifestation filed on July 31, 1998 be
recognized and respected.
This case is considered CLOSED and
TERMINATED.
On October 30, 1998, Mr. Pael executed
another flip-flopping "Sinumpaang
Salaysay"
27
again retracting his earlier "Motion
at Manipestasyon".
Likewise, on November 5, 1998, the Heirs of
Antonio Pael and Andrea Alcantara and Crisanto
Pael, namely Zosima, Jose, Cresencia, Gloria,
Segundo and Cristanto, Jr., all surnamed Pael,
submitted to this Court a "Sinumpaang
Salaysay"
28
wherein they disowned the previous
manifestation of Mr. Roberto Pael withdrawing
their appeal and recognizing the rights of private
respondents.
On November 6, 1998, private respondents filed
a "Motion for Issuance of Entry of
Judgment",
29
in accordance with Rule 36 of the
Rules of Court.
On May 24, 1999; after a series of pleadings
and counter-pleadings from the parties, all noted
by this Court, private respondents filed an
"Urgent Motion for Issuance or Entry of
Judgment"
30
considering that the case had
earlier been closed and terminated. They
alleged that the issuance of the entry of
judgment will be consistent with the doctrinal
rulings of this Court that in case of closure and
termination of cases, entry of judgment is
ordered in due course, the parties are notified
accordingly, and the case is recorded in the
Book of Entries of Judgment. This Court noted
the motion on June 24, 1999.
On July 28, 1999, this Court issued a Resolution
granting petitioner's motion for reconsideration
of the October 5, 1998 Resolution, which
considered this case closed and terminated, and
reinstating the petition for review oncertiorari in
G.R. No. 133547.
31

Subsequently, on July 9, 1999, Luis M. Menor
filed an "Urgent Motion for Intervention" in both
petition,
32
together with an attached "Complaint-
in-Intervention Against Both Original parties"
33
.
On August 6, 1999, intervenor filed a Motion to
Admit Supplemental pleading.
34

On August 10, 1999, private respondents
opposed Menor's motion for intervention.
35
They
cited the fatal procedural defects of the motion
for intervention and why there should be non-
admission of the intervention at this late stage of
the proceedings.
After considering the numerous and voluminous
pleadings filed in these two cases, the
intervention of Luis Menor, the alleged sale to
PFINA Properties, Inc. and the alleged interests
of Letty Sy, the comments on the petitions are
treated as answer to the petitions. We find the
pleadings to be sufficient in form and substance
and the issues sufficiently joined. We resolve to
give due course to the petitions and accordingly
decide them.
Prefatorily, we first pass upon the issue of the
withdrawals by Roberto Pael of the petition for
review filed in G.R. No. 133547.
Private respondents contend that the
withdrawals made by Roberto Pael of the
petition filed by him in his capacity as
Administrator of the Pael Estate and in his
capacity as representative of the Heir or Antonio
Pael, Andrea Alcantara and Crisanto Pael, were
freely and voluntarily executed by Mr. Pael.
They likewise contend that when asked by either
of the two solemnizing officers, RTC Branch
Clerk of Court of Quezon City, Branch 99,
Josefina Castro, and Supreme Court Assistant
Division Clerk of Court Enriqueta Esguerra-
Vidal, if Mr. Pael understood the contents of the
motions or papers he was signing, Mr. Pael
readily answered that he fully understood the
contents and statements he made therein and
that he freely and voluntarily executed the same.
They further argue that the aforesaid
withdrawals were couched in the Pilipino or
Tagalog dialect, which Mr. Pael very well
understands. Atty. Castro of the Regional Trial
Court, and Atty. Vidal of the Supreme Court, are
two respected and responsible officers of the
Judiciary. There is no reason to doubt that they
competently performed their duties as
solemnizing officers of the motions-withdrawals.
Private respondent also contend that this Court
acted correctly and to the best interest of the
parties when it issued the Resolution dated
October 5, 1998 declaring this case closed and
terminated. This Court need not proceeded with
the case if petitioners, through their duly
authorized representative, no longer desire to
prosecute their case.
We fully agree with private respondents. Entry of
judgment could have been ordered in this case.
In a Resolution issued by this Court En Banc on
September 14, 1999, we ordered that entry of
judgment shall be made in cases where
resolutions have been issued denying
extensions of time to file petitions or declaring
cases closed and terminated for failure to file
petition. With more reason should entry of
judgment be ordered where petitioners freely
and voluntarily withdraw their petition. The en
banc resolution reads in full.
Re: Request for Uniform Guidelines in
Entries of Judgment Involving Denial
Extension of Time to File Petition or
Cases Declared Closed and Terminated
for Failure to File a Petition The Court
Resolved that from hereon ENTRY OF
JUDGMENT shall be made in cases
where resolutions have been issued
denying extensions of time to file
petition or declaring cases closed and
terminated for failure to file a petition.
The claims of private respondents are
meritorious. We find that Mr. Roberto Pael
voluntarily and freely withdrew the petition. He is
the known and authorized representative of
petitioners Pael and the Administrator of the
Pael Estate who has always acted for petitioners
at all stages of the proceedings. We have no
doubt that the solemnizing court officials
conducted the necessary steps to ensure that
the motions or papers being solemnized by them
were freely and voluntarily executed by the
affiants.
At any rate, even if we disregard the said
withdrawals and give recognition to the
vacillating attitude displayed by Mr. Pael, we find
from the records that there is substantial merit to
the position of private respondents in these
cases. Decided on the merits, the outcome will
be the same.
Petitioners in G.R. No. 133547, the heirs of
Antonio Pael, Andrea Alcantara and Crisanto
Pael, anchored their petition for review on the
following assignment of errors:
I
THE HONORABLE COURT OF APPEALS
GRAVELY MISAPPRECIATED, IGNORED,
MISAPPLIED AND/OR OVERLOOKED THE
FACT THAT UNDER THE FACTS AND
CIRCUMSTANCES OF THIS CASE, THE
ANNULMENT OF JUDGMENT IS IMPROPER
AS THERE WAS NO EXTRINSIC FRAUD OR
RECKLESS AND GROSS NEGLIGENCE
COMMITTED BY PRIVATE RESPONDENTS'
FORMER COUNSEL, ATTY. OLIVER LOZANO,
HENCE, THE ASSAILED DECISION OF THE
APPELLATE COURT SHOULD BE STRICKEN
DOWN FOR BEING WITHOUT ANY CREDIBLE
BASIS.
II
THE HONORABLE COURT OF APPEALS
SERIOUSLY ERRED IN NOT HOLDING THAT
ASSUMING ARGUENDO THAT EXTRINSIC
FRAUD AND GROSS AND RECKLESS
NEGLIGENCE WERE COMMITTED BY ATTY.
LOZANO, PRIVATE RESPONDENTS WERE
BOUND BY SAID EXTRINSIC FRAUD AND
GROSS AND RECKLESS NEGLIGENCE AS
THEY THEMSELVES CONTRIBUTED TO THE
COMMISSION OF SUCH FRAUD AND
NEGLIGENCE OF THEIR COUNSEL.
III
THE HONORABLE COURT OF APPEALS
GRAVELY ERRED IN NOT HOLDING THAT
THE REVIVAL OF THE TITLE IN FAVOR OF
ANTONIO PAEL AND ANDREA ALCANTARA
AND CRISANTO PAEL, EVEN IF THEY ARE
NOT PARTIES TO THE CASE BELOW, WAS A
LOGICAL CONSEQUENCE OF THE DEFAULT
JUDGMENT.
IV
THE HONORABLE COURT OF APPEALS
GRAVELY ERRED IN NOT HOLDING THAT
SINCE THE DEFAULT JUDGMENT HAD
ALREADY LONG BECOME FINAL AND
EXECUTORY, CONSEQUENTLY THE
REINSTATEMENT OF THE TITLES OF
PRIVATE RESPONDENTS AND THE
DECLARATION AS NULL AND VOID OF THE
TITLE IN THE NAMES OF ANTONIO PAEL
AND ANDREA ALCANTARA AND CRISANTO
PAEL WERE ERRONEOUS AND IMPROPER.
V
THE HONORABLE COURT OF APPEALS
GRAVELY ERRED WHEN IN ITS DECISION IT
ADJUDICATED THE CASE ON THE MERITS,
WHICH IS PROCEDURALLY FLAWED.
36

Maria Destura, on the other hand, petitioner in
G.R. No. 133843, raised the following grounds:
1. The ruling of the respondent Court of
Appeals that private respondents are
not bound by the negligence and
incompetence of their counsel is
erroneous and contrary to law and
jurisprudence.
2. The ruling of the respondent Court of
Appeals that the gross negligence of
counsel for private respondents
constitutes is "extrinsic fraud" is likewise
erroneous and contrary to law and
jurisprudence.
3. Granting for the sake of argument,
that there is basis to annul the
questioned decision, the action of
respondent Court of Appeals in
adjudicating the merits of the case is
contrary to Section 7, Rule 47 of the
Rules of Court.
4. The findings of the respondent Court
of Appeals that the interest of the private
respondent in the subject property over
that of petitioner is borne out by any
evidence in the records of the case in
the trial court.
37

The petition being one for annulment of
judgment, the principal issue to be resolved is
whatever there was extrinsic fraud, want of
jurisdiction, or lack of due process that attended
the rendition of the Decision dated January 24,
1995 and the issuance of the Order dated
August 28, 1995 in Civil Case No. Q-93-18569.
In Cosmic Lumber Corporation v. Court of
Appeals,
38
this Court had occasion to state that
fraud may assume different shapes and be
committed in as many different ways, and here
lies the danger of attempting to define fraud. For
man in his ingenuity and fertile imagination will
always contrive new schemes to fool the
unwary.
There is extrinsic fraud within the
meaning of Sec. 9 par. (2), of B.P. 819.
Blg, where it is one the effect of which
prevents a party from hearing a trial, or
real contest, or from presenting all of his
case to the court, or where it operates
upon matters, not pertaining to the
judgment itself, but to the manner in
which it was procured so that there is
not a fair submission of the controversy.
In other words, extrinsic fraud refers to
any fraudulent act of the prevailing party
in the litigation which is committed
outside of the trial of the case, whereby
the defeated party has been prevented
from exhibiting fully his side of the case
by fraud or deception practiced on him
by his opponent. Fraud is extrinsic
where the unsuccessful party has been
prevented from exhibiting fully his case,
by fraud or deception practiced on him
by his opponent, as by keeping him
away from court, a false promise of a
compromise; or where the defendant
never had any knowledge of the suit,
being kept in ignorance by the acts of
the plaintiff; or where an attorney
fraudulently or without authority
connives at his defeat; these and similar
cases which show that there has never
been a real contest in the trial or hearing
of the case are reasons for which a new
suit may be sustained to set aside and
annul the former judgment and open the
case for a new and fair hearing.
39

In granting the petition for annulment of
judgment, the Court of Appeals found the
following instances as indicative of the
attendance of extrinsic fraud:
(a) The enigmatic failure of petitioners'
(i.e., respondents Chin and Mallari)
former counsel to file an answer to the
complaint within the period prescribed
by the Rules of Court which resulted in a
decision by default. The property is
extremely valuable and strongly coveted
by scheming persons whose false
claims have been rejected in the past.
The petitioners were absolutely denied
the opportunity to be heard and to
present their side in the proceedings
below;
(b) The immediate filing by their former
counsel of their notice of appeal from
the default judgment, and the filing a few
days later of a motion for new trial
despite the perfection of their appeal,
knowing fully well that both remedies
(appeal and new trial) are utterly
inconsistent with and contradictory to
each other;
(c) Petitioners were deprived of their
right to have the appellate court pass
upon, consider and resolve the merits of
their appeal and to have their side of the
case ventilated, as well as the
suspicious actuations on the part of
petitioners' former counsel resulting in
the denial of petitioners of their day in
court, amounting to gross and reckless
negligence of their counsel, which
constituted a gross violation of
petitioners' right to due process;
(d) The flip-flopping committed by the
respondent trial court in its order when it
ruled on petitioners' motion and
supplemental motion for new trial and at
the same time declared that it had no
jurisdiction over the case as the
appealing parties therein (petitioners)
had expressly abandoned their appeal;
(e) The utter lack of merit of the Destura
complaint shown by the fact that the
respondent Judge had to search for a
non-party, who might have a shadow of
a claim to the disputed titles, instead of
merely dismissing the complaint;
(f) The refusal of the appellate court to
clarify its judgment and to and to amend
the dispositive portion of the said
judgment; and
(g) The manifest bias, partiality and
collusion by the respondent Judge with
the sheriff and the private respondent
Maria Destura and her spouse Pedro
Destura, and with the Paels, as shown
among others, by the fact that the title of
the petitioners over the subject property
was delivered by the sheriff personally
to Maria Destura, which is clearly highly
irregular and anomalous. Especially,
when the Court ruled that Destura had
no right to any title and instead awarded
title to the Paels.
40

Citing the case of Laxamana v. Court of
Appeals
41
, the Court of Appeals held that there
is extrinsic fraud justifying annulment of
judgment in instances wherein a party was
prevented from defending the action brought
against him on account of the delinquent acts
and omissions of his attorney. Thus:
Lack of due process of law and extrinsic
or collateral fraud vitiate a final and
executory judgment and are valid
grounds for setting it aside. In an
adversary litigation, fundamental
fairness requires that as much as
possible both parties should be heard so
that a just and impartial verdict may be
promulgated.
The extrinsic or collateral fraud which
invalidates a final judgment, "must be
such as prevented the unsuccessful
party from fully and fairly presenting his
case or defense; it must be such as
prevented the losing party from having
an adversary trial of the issue". Thus,
the act of the successful party in
inducing the lawyer of the losing party to
commit professional delinquency or
infidelity constitutes extrinsic or
collateral fraud.
In other words, there is extrinsic fraud
when a party was prevented from
having presented all of his case to the
court as when the lawyer connives at his
defeat or corruptly sells out his client's
interest.
42

Since the badges of fraud as found by the Court
of Appeals have their origin in the acts of
respondents' counsel, it becomes necessary to
pass upon the effects of those acts on
respondents' defense. Petitioners in both cases
maintain that respondents should be bound by
the mistakes of their counsel and, thus, must
suffer the consequence of the dismissal of their
appeal due to the mistake of Atty. Oliver Lozano
in resorting to two clearly inconsistent remedies,
namely, appeal and motion for new trial.
However, the rule, as correctly held by the Court
of Appeals, is not hard and fast one and admits
of exceptions, such as where the mistake of
counsel is so gross, palpable and inexcusable
as to result in the violation of his client's
substantive rights. For while it is true that the
acts of a lawyer in the defense of a case,
including his mistakes and negligence, are the
acts of his client, this rule does not extend where
such mistakes or negligence would result in
serious injustice to the client.
43
In cases of gross
and palpable negligence of counsel, the courts
must step in and accord relief to a client who
suffered thereby.
44

Such is the situation in the case at bar. When
Atty. Lozano filed a motion for new trial days
after filing a notice of appeal, he should have
known that his appeal had already been
perfected. Consequently, the trial court lost its
jurisdiction over the case, save for acts for the
protection or preservation of the rights of the
parties which do not involve matters litigated in
the appeal.
Perfection of appeal; effect thereof. A
party's appeal by notice of appeal is
deemed perfected as to him upon the
filing of the notice of appeal in due time.
A party's appeal by record on appeal is
deemed perfected as to him with
respect to the subject matter thereof
upon the approval of the record on
appeal filed in due time.
In appeals by notice of appeal the court
loses jurisdiction over the case upon the
perfection of the appeals filed in due
time and the expiration of the time to
appeal of the other parties.
In appeals by record on appeal, the
court loses jurisdiction only over the
subject matter thereof upon the approval
of the records on appeal filed in due
time and the expiration of the time to
appeal of the other parties.
In either case, prior to the transmittal of
the original record or the record on
appeal, the court may issue orders for
the protection or preservation of the
rights of the parties which do not involve
any matter litigated by the appeal,
approve compromises, permit appeals
of indigent litigants, order execution
pending appeal in accordance with
section 2 of Rule 39, and allow
withdrawal of the appeal.
45

Having first opted for the remedy of appeal and
having filed the requisite notice thereof, Atty.
Lozano should have been fully aware that the
trial court had already lost jurisdiction over the
case. Thus, the court could not have validly
entertained the motion for new trial that Atty.
Lozano subsequently filed. This palpable error
was compounded by the act of the trial court in
denying the motion for new trial and at the same
time dismissing respondents' appeal.
Necessarily, respondents, through no fault or
negligence of their own, were left with no
remedy to obtain substantive relief from the
judgment rendered against them, thereby
resulting in a flagrant denial of their right to due
process. In cases such as the one at bar, the
courts have the legal and moral duty to provide
judicial aid to parties who are deprived of their
rights. Indeed, respondents were then in no
position to analyze the legal niceties of the
remedies resorted to by their counsel and to
realize the deleterious effects of the latter's
tactical errors and the invalid acts of the trial
judge on their cause. As succinctly stated by the
Court of Appeals:
Petitioners' (respondents herein) hands
were thus tied in view of the gross
negligence of their former counsel, the
Flip-flopping committed by Judge
Bersamin and the refusal of the
appellate court to clarify its judgment
and amend the dispositive portion of the
said judgment. They were unjustifiably
and unceremoniously stripped of their
titles over their property by Judge
Bersamin, and instead the title of the
Paels who were never parties to the
case and are complete strangers thereto
was reinstated. The actuations of
Judge Bersamin are clearly prejudicial
to the superior interests of the
petitioners (i.e., respondents herein)
over the subject property which
compelled them to institute the instant
Petition for Annulment of Judgment.
46

More importantly, the Court of Appeals took note
of the contradictory decisions of Judge Lucas
Bersamin in Civil Case No. Q-93-18569, on the
one hand, and Civil Case No. Q-89-4275, on the
other hand, which prejudiced respondents
herein. In the latter case, Judge Bersamin
reversed the appealed judgment which
dismissed the ejectment suit filed by Luis and
Leony Menor against Roberto and Juanita Pael,
and upheld the sale of 70% portion of the
subject land by the Paels to the Menors. In the
case below, however, the same Judge Bersamin
ordered the reinstatement of TCT No. 36048 in
the name of the Paels.
Not only are the Decision and Order tainted with
irregularities constituting extrinsic fraud. The
Court of Appeals correctly ruled that they are
null and void. Maria Destura's complaint should
have been dismissed on the ground of litis
pendentia and res judicata, considering that her
husband Pedro Destura had earlier filed a
complaint, Civil Case No. Q-93-14522,
principally against the same defendants, namely
respondents Chin and Mallari, for, among
others, annulment of their titles and annulment
of the Memorandum of Agreement. These are
the same causes of action pleaded by Maria in
Civil Case No. Q-93-18569. As held by the Court
of Appeals:
The filing of the complaint by Maria
Destura with respondent Court (i.e.,
RTC Quezon City, Branch 96) also
violated the rule on litis pendencia under
Rule 16 of the Rules of Court. The
pendency of another action or litis
pendencia to be invoked, it is required
that the parties to the action are the
same, that there is substantial identity of
the cause of action and the relief
sought, and that the result of the first
action is determinative of the second in
any event (Anorthcolt & Co. vs. Villa
Abrile, 41 Phil. 462).
Here, while the appeal by Pedro
Destura from the order of dismissal by
Judge de Guzman of his complaint for
annulment of titles, reconveyance
and/or specific performance and
damages on November 5, 1993, as well
as the validity of the memorandum of
agreement, was pending before the
appellate court, Maria Destura
commenced on December 9, 1993 a
similar action for annulment of
memorandum of agreement and titles
with damages before the same Regional
Trial Court of Quezon City. A shown
above, the Court of Appeals rendered a
decision only on December 10, 1996
affirming the order of Judge de Guzman.
That judgment is final and has been
executed a long time ago.
Maria Destura's complaint should be
stricken down on ground of res judicata.
Pedro Destura previously filed before
Judge De Guzman an action impugning
the validity of the memorandum of
agreement and the titles of
(respondents) Chin and Mallari. The trial
court thru Judge de Guzman dismissed
the complaint in effect upholding the
validity of the memorandum of
agreement and the titles of the
(respondents). This dismissal was
affirmed by the Court of Appeals, which
categorically stated that the titles of Chin
and Mallari are better than those of the
Desturas. Clearly, res judicata lies. All
the essential elements of res
judicata are present in the instant case,
namely: (a) that the previous judgment
must be final; (b) that the prior judgment
was rendered by a court having
jurisdiction over the subject matter and
the parties; (c) that there must be
between the first and second actions
identity of parties, subject matter and
causes of action. (Mangoma vs. Court of
Appeals, 241 SCRA 21, Guevara vs.
Benito, 247 SCRA 570). Even if the
plaintiff in the first action was Pedro
Destura, while in the second action, the
plaintiff was Maria Destura, wife of
Pedro Destura, still there is identity of
parties because Maria Destura is a
successor-in-interest of Pedro Destura.
A decision is conclusive upon the
parties therein as well as their
successors-in-interest under the
doctrine of res judicata. (Suobiron vs.
Court of appeals, 250 SCRA 184).
Moreover for res judicata to apply, what
is required is not absolute but only
substantial identity of parties. (Javier v.
Veridiano II, 237 SCRA 565).
47

The Court of Appeals also found that petitioner
Maria Destura did not come to court with clean
hands when she instituted Civil Case No. Q-93-
18569. She should have known then that her
husband's complaint, docketed as Civil Case
No. Q-93-14522, had already been dismissed
for lack of cause of action. She also knew that
the said decision, affirmed by the Court of
Appeals, became final and executory.
On the whole, annulment of judgment was the
proper remedy for respondents, notwithstanding
that the judgment by default against them had
already become final. They were left with no
other remedy under the circumstances.
Moreover, a petition for annulment of judgment
on the ground of extrinsic fraud may be filed
within four years from the discovery of the
same.
48
Hence, petitioners' contention that
respondents could no longer avail of the remedy
of annulment of judgment because the judgment
by default against them had already become
final holds no water.
Moreover, the trial-court's decision is not only
erroneous but is void from the beginning as the
title was given to the Paels despite the fact that
they were not parties and have been total
strangers to the said case. They were never
impleaded nor did they intervene in the case
wherein the disputed property was awarded to
them.
Petitioners argue that the reinstatement of the
title in favor of Antonio Pael and Andrea
Alcantara and Crisanto Pael is not
unprecedented, dubious or unthinkable even if
the Paels were not parties to the case below.
The claim that the judgment did not favor a non-
party or a stranger to the case, like the Paels, is
contrary to the trial court's decision itself which
in no uncertain terms specifically ordered the
Register of Deeds of Quezon City to cancel TCT
Nos. 52928 and 52929 in the names of private
respondents and thereafter to reinstate TCT No.
360478, which was in the names of the spouses
Antonio Pael and Andrea Alcantara and Crisanto
Pael, before they sold the land to private
respondents.
The trial court's decision, insofar as it reinstated
the title of the Paels, cannot be enforced,
consistent with the rule enunciated by the
Supreme Court in the following cases:
A person not included as a party to a
case cannot be bound by the decision
made by a court.
49

A person who was not impleaded in the
complaint could not be bound by the
decision rendered thereon for no man
shall be effected by a proceeding to
which he is a stranger.
50

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.
51

On the issue of ownership of the land in dispute,
the records sustain the claim of private
respondents as against those of petitioners.
As earlier stated with respect to petitioner Maria
Destura, she has no valid claim of ownership.
The Regional Trial Court and the Court of
Appeals ruled against the claim of her husband
in Civil Case No. Q-93-14522. The decisions,
long final and executory per entry of judgment,
upheld the titles of Chin and Mallari and
declared that they have a better title to the
property. Maria Destura tried to revive the case
lost by her husband by also impleading him
together with Chin and Mallari. Later, however,
she withdrew her complaint against her
husband.
Equally important, Destura did not appeal from
the court's decision. The said decision has
already become final and executory as to
Destura. She is thus bound by the decision of
the trial court and has no right to file a petition
directly with the Supreme Court.
That Destura has no right whatsoever over the
subject property was expressly declared by the
appellate court in its Resolution dated January
8, 1998, to wit:
We cannot resolve the merits of movant
Letty Sy's plea that she is a real party in
interest in the instant case without going
over the records of this case so far
submitted to the Court, including the
decisions of the trial and appellate
courts. For, Letty Sy's motion would rise
or fall depending on whether or not
Maria Destura has any interest in the
subject properties. Let it be emphasized,
however, that We are not, at this time,
deciding the petition for annulment of
judgment on the merits or resolving
whether the petitioner's petition for
annulment of judgment has any merit, or
that private respondents' opposition
thereto should be given credence. What
we are concerned only now is the
motion of Letty Sy to substitute Maria
Destura on the ground that she is the
absolute owner of the property having
bought the property from Maria Destura,
and that the latter is no longer filing her
comment on the petition.
We find established to Our satisfaction
that Letty Sy's motion is not impressed
with merit.
x x x x x x x x x
. . . It thus appearing that spouses Maria
Destura and Pedro Destura do not have
any evidence to prove that they own the
subject properties which they sold to
Letty Sy, consequently, Letty Sy's
motion to substitute Maria Destura
based on her having bought the subject
properties from Maria Destura by virtue
of an alleged Deed of Absolute Sale
cannot be given judicial imprimatur.
52

Letty Sy's claim that Destura is no longer
interested and that Sy is the interested party is
negated by Destura's filing of a 44-page
pleading actively pursuing her case before the
Court of Appeals.
The appellate court ruled "that the spouses
Maria Destura and Pedro Destura do not have
any evidence to prove that they own the subject
properties which they sold to Letty Sy." Destura
did not refute this finding that she sold property
she did not own in her petition. She was silent,
even if the appellate court's finding was
damaging to her stand.
Maria Destura's complaint should also be
stricken down on the ground of res judicata. The
Quezon City Regional Trial Court had earlier
dismissed her husband's 1993 complaint. The
Court of Appeals, in affirming the Regional Trial
Court's decision on December 10, 1996,
categorically ruled that the titles of private
respondents are superior to that of the Desturas.
As to the Paels, they likewise have no right over
the subject properties. The Court of Appeals
found sufficient evidence to establish that they
had already sold 70% of the land, comprising an
area of 543,633.90 square meters, to Luis and
Leonor Menor. This 70% portion was, in turn,
sold by Menor to private respondents Chin and
Mallari on December 10, 1978. Insofar as the
remaining 30% of the land is concerned, there is
likewise evidence to show that the same was
sold by the Pael heirs directly to Chin and
Mallari also on December 10, 1978. Eventually,
titles were issued in private respondents' names.
As earlier stated, it was error for respondent trial
court to cancel the titles of private respondents
and order the reinstatement of title in the name
of Antonio Pael, Andrea Alcantara and Crisanto
Pael, because the Paels were not parties to the
case below. The party plaintiff in that complaint
for annulment of title, Civil Case No. Q-93-
18569, was Maria Destura alone. The
defendants therein were private respondents
herein, Jorge H. Chin and Renato B. Mallari, as
well as the Register of Deeds of Quezon City.
The highly anomalous and deplorable conduct of
the Register of Deeds of Quezon City in
registering the reinstated title in favor of the
Paels who were non-parties to the case, inspite
of his being a defendant in the case, resulted in
the sale of this vast tract of land by the Paels to
anybody right and left, including Letty Sy,
PFINA, and presumably others who have not
come forward to intervene in this case.
The Paels, having no longer any right over the
subject property, had nothing to sell to PFINA.
Therefore, the title obtained by PFINA allegedly
by virtue of the deed of assignment executed by
the Paels in its favor is a nullity. Worse, the
Register of Deeds of Quezon City connived and
conspired with PFINA when the former
registered the deed of assignment on the basis
of fake and spurious documents.
The Court of Appeals also found it unbelievable
for PFINA to acquire extremely valuable real
estate in Quezon City for only P30.00 per
square meter. In 1983, PFINA Mining and
Exploration, Inc. was a mining company. It
changed its corporate name to PFINA
Properties, Inc., only on January 22, 1998, six
(6) days before filing its petition-in-intervention
with the Court of Appeals. In its petition, PFINA
claimed to have bought urban real estate in
1983, notwithstanding that at the time it was still
a mining company which had no business
dabbling in the highly speculative urban real
estate trade.
The Court of Appeals further ruled:
The arguments regarding payment of
taxes by the Paels are absurd, to say
the least, and they tend to make the
Paels appear as blockheads. The
P20,000,000.00 allegedly paid to the
Paels would be a paltry fraction of the
amount of taxes which would be
involved in a genuine sale of this
magnitude. The Office of the Treasurer
of Quezon City has certified that the
certificate of real estate tax payment
dated January 21, 1998 was not issued
by their Office, that the receipts of tax
payments are fabricated and that the
signature in the certification is not the
signature of the issuing officer.
53

On the other hand, the records show that private
respondents are the owners of the subject
property by virtue of the sale to them by the
Menors and the Paels as early as December 10,
1978. As above stated, the Paels sold 70% of
the total land area of the property to the spouses
Luis and Leony Menor. The Menors, in turn, sold
to private respondents the same 70%, while the
remaining 30% was old by the surviving heirs of
the Paels to private respondents. In a separate
Decision dated December 10, 1996 in CA-G.R.
CV No. 44324, the Court of Appeals ruled that
private respondents have a better right over the
subject property because of these transactions.
The Court of Appeals also held:
Glaringly inexplicable is the fact that
Maria Destura claims ownership of the
subject property over the Paels when
Pedro Destura caused the execution of
a document entitled "Extrajudicial
Settlement of Estate of Deceased
Spouses Antonio Pael and Andrea
Alcantara with Sale Adjudication" and
the execution of a deed of sale of the
property between Pedro Destura and
Lutgarda which was by virtue of a
Special Power of Attorney allegedly
executed in favor of Marilao. Pedro
Destura did not mention any transfer of
the property between him and Maria
Destura and the spouses Luis and
Leony Menor who later on canceled and
registered in their favor TCT No. 36048
which constitutes 70% of the property of
the Paels sold to them in 1978, very
much earlier than the alleged sale in
1979.
On the other hand, the records show
that the ownership by petitioners Jorge
H. Chin and Renato B. Mallari of the
subject property is by virtue of the sale
of 70% of the total land area of
543,633.90 square meters made by the
Paels in favor of the spouses Luis and
Leony Menor. Menor in turn sold to Chin
and Mallari the aforesaid 70% of the
land area, while the remaining 30% of
the land area was sold by the surviving
heirs of the Paels to Chin and Mallari in
1978, respectively.
54

We have carefully read and scrutinized the
Court of Appeals' findings and find no error in
them. The facts, the law and the jurisprudence
clearly support the holding that private
respondents are the true and absolute owners of
the disputed property since 1978.
Petitioners argue that the adjudication of the
case on the merits by the Court of Appeals was
procedurally flawed as it violated Rule 47,
Section 7 of the Rules of Court, and that the
case should have been remanded to the trial
court.
This argument deserves scant consideration.
There is no point in remanding the case to the
court below because the property was awarded
to a non-party the Paels despite the fact
that private respondents are the registered
owners thereof. The Court of Appeals did not
annul a valid registration but merely declared a
questionable registration, which was void
because there was an existing registration and
there was a notice oflis pendens annotated on
the titles of private respondents. The Register of
Deeds flagrantly ignored and violated these
when he allowed the registration and issuance
of the title first in favor of the non-parties Paels
and then, in favor of PFINA, the dubious
corporation.
Private respondents are the real victims in this
case. When they bought the property from the
Menors and the Paels, they registered the sale
and, consequently, titles were issued in their
names. There is nothing in the records that
could affect the validity of their earlier ownership
over the disputed property and, their titles
having been illegally and unlawfully canceled, it
is only right that the same be restored.
The filing by private respondents of the petition
for annulment of judgment before the Court of
Appeals did not presuppose the validity, finality
and executory nature of the judgment sought to
be annulled. Nowhere in Section 1 of Rule 47 of
the Rules of Court does it imply such validity of
the judgment of the trial court. It would be
procedurally improper for the Court of Appeals
to remand the proceedings below and order the
trial court to conduct a new trial of the case
under Rule 47, Section 7 because respondent
trial court did not just dismiss the complaint of
plaintiff Destura, but also canceled the titles of
defendants, now private respondents, and
reinstated the titles of the Paels who were total
strangers to the action. Moreover, with manifest
bias, partiality and collusion among the trial
judge, the sheriff, Maria Destura and her
husband Pedro, and the Paels, which the Court
of Appeals took cognizance of, remanding the
case to the court below for new trial would be an
exercise in futility and an unnecessary
prolongation of a case commenced six (6) years
ago.
Furthermore, the decision of the Court of
Appeals is justified by the fact that during the
proceedings before the appellate court, the
Register of Deeds irregularly issued a new title,
TCT No. 186662, in favor of PFINA. The
function and importance of a notice of lis
pendens were lost on respondent trial judge and
the Register of Deeds. As held in Seveses v.
Court of Appeals, et al.:
55

We once more emphasize that a notice
of lis pendens is an announcement to
the whole world that a particular
property is in litigation, and serves as a
warning that one who acquires an
interest over said property does so at
his own risk, or that he gambles on the
result of the litigation over said
property.
56

Coming now to the issue of intervention, it would
appear that intervenor Menor's Motion for
Intervention is not only without merit but was
also filed late. Rule 19, Section 2 of the 1997
Rules of Civil Procedure provides that a motion
to intervene should be filed "before rendition of
judgment by the trial court". To be sure,
intervention can no longer be allowed in this
case. Menor's intervention was filed with the
Supreme Court only in 1999, during the latter
stage of the proceedings herein.
At any rate, even if the Motion for Intervention
was seasonably filed, it should still be denied.
As we held inSeveses v. Court of Appeals, et
al.:
57

In the case of Santiago Land
Development Corporation vs. Court of
Appeals (G.R. No. 106194, 276 SCRA
674 [1997]), petitioner maintained that
as a purchaser pendente lite of the land
in litigation, it had a right to intervene
under Rule 12, Section 2. We rejected
this position and said that "since
petitioner is not a stranger to the action
between Quisumbing and the PNB,
petitioner in fact having stepped into the
shoes of PNB in a manner of speaking,
it follows that it cannot claim any further
right to intervene in the action." As in the
instant Petition, it was argued that the
denial of the Motion to Intervene would
be a denial likewise of due process. But
this, too, was struck down in Santiago
Land where we held that "petitioner is
not really denied protection. It is
represented in the action by its
predecessor in interest." Indeed, since
petitioner is a transferee pendente
lite with notice of the pending litigation
between Reyes and private respondent
Carreon, petitioner stands exactly in the
shoes of Reyes and is bound by any
judgment or decree which may be
rendered for or against the latter.
Indeed, the records show that intervenor Menor
had already sold the properties purchased from
the Paels. And if intervenor has any cause of
action against private respondents, he should
seek his remedies elsewhere and not before this
Court.1wphi1.nt
WHEREFORE, the petitions for review in G.R.
No. 133547 and G.R. No. 133843 are DENIED.
The appealed Decision of the Court of Appeals
dated April 29, 1998 is AFFIRMED with the
MODIFICATION that the Register of Deeds of
Quezon City is ordered, within ten (10) days
from finality of this Decision, to cancel Transfer
Certificate of Title No. 186662 in the name of
PFINA Properties, Inc., and RESTORE to
private respondents within the same period
Transfer Certificate of Title Nos. 52928 and
52929 registered in their names.
The Motion to Intervene filed by Luis M. Menor
is DENIED for lack of merit.
SO ORDERED.