3, 1966 Court hereby declares Jesus Aguirre JESUS AGUIRRE, petitioner, the absolute owner of the property vs. described in his complaint. The VICTOR S. PHENG, in his capacity as subsequent sale made by General Manager of the LEONORA & defendants Aldaba to Zosimo COMPANY, and NATIONAL SHIPYARDS Gabriel, the sale made by Zosimo AND STEEL Gabriel to defendant Leonora and CORPORATION, respondents. Co.; and the sale made by Sisenando Villaluz for petitioner. defendant Leonora and Co. to the M. C. Virata for respondent National National Shipyards and Steel Shipyards and Steel Corporation. Corporation, are hereby declared null and void and of no effect. Defendants Aldaba and Leonora BARRERA, J.: and Co. and the National Shipyards Antecedents.On June 28, 1954, Vicente and Steel Corporation, are hereby Aldaba and Teresa V. Aldaba sold to Jesus ordered to deliver to plaintiff Jesus Aguirre a circular bolted steel tank with a Aguirre the tank in question. Failure capacity of 5,000 gallons, for the sum of to make such delivery, defendant P900.00, for which the latter delivered to National Shipyards and Steel the sellers duly endorsed, Security Bank & Corporation, in whose possession Trust Company check No. 281912, in the the tank is at present, shall pay to amount of P900.00. Aguirre, however, the said Jesus Aguirre the original failed to, take physical possession of the purchase price of the tank in the tank, having been prevented from doing amount of P900.00. so by the municipal authorities of Los Baos, Laguna (where the tank was No appeal having been perfected on time, located), in view of the claim of ownership this decision became final. being made by the Bureau of Public Highways. It appears, however, that In Civil Case No. 27988, the court Vicente and Teresa Aldaba again sold the rendered decision based on a stipulation same tank on December 2, 1954 to of facts by the parties, wherein the Zosimo Gabriel, for P900.000. Gabriel, in existence of Civil Case No. 24914 was turn, sold it to the Leonora & Company on admitted, the dispositive portion of which December 5, 1954, for P2,500.00. After provides: some alterations and improvements made on the tank, Leonora & Company was able IN VIEW OF THE FOREGOING to sell the tank to National Shipyards & AGREEMENT, judgment is hereby Steel Corporation (Nassco), for rendered as follows: P14,500.00. 1 Intervenor Jesus Aguirre, as we Aguirre immediately filed with Nassco a have already declared in Civil Case formal notice of his claim of ownership of No. 24914, is hereby adjudged the tank, as a consequence of which, owner of the oil tank in question. payment of the purchase price to Leonora Defendant National Shipyards and & Company was suspended. Then, Aguirre Steel Corporation is hereby ordered instituted Civil Case No. 24914 in the to deliver to the said Jesus Aguirre Court of First Instance of Manila, against such tank, but in the event that Leonora & Company and the Aldabas, for delivery is not possible, to pay to delivery to him of the tank, with damages. Aguirre the purchase price of On the other hand, because of the P900.00, and to Leonora and Co. suspension of payment of the purchase the amount of P11,299.00 which price, Leonora & Company filed Civil Case represents the costs of the No. 27988, against the Nassco, praying for improvements made by the said the delivery of the purchase price of Leonora & Co. P14,500.00, or the reimbursement of the sum of P2,299.00 allegedly representing In the event that the National the actual investment and expenses made Shipyards and Steel Corporation and incurred to put the tank in usable shall deliver the oil tank to Jesus condition. Jesus Aguirre intervened in this Aguirre as it is, the latter shall pay proceeding. These two cases were jointly to Leonora and Co. the amount of heard by the trial court. P11,299.00 which, as already Thereafter, decision was rendered in Civil stated, was spent by Leonora and Case No. 24914, the dispositive portion of Co. for the improvement of the which reads as follows: tank. From this decision, Aguirre perfected an amounting to P11,299.00 by Leonora & appeal to the Court of Appeals. Company was done in bad faith. Furthermore, to uphold petitioner's The present case.On January 9, 1963, contention that he is entitled to the sum of the Court of Appeals rendered decision P14,500.00 the price of the tank in its affirming the judgment of the lower court present condition, would be to allow him in Civil Case No. 27988, to return to to enrich himself at the expense of intervenor Aguirre the sum of P900.00 in another. The lower courts, therefore, acted case delivery of the tank to him will not be correctly in ordering the reimbursement to possible Leonora & Company of the expenses it made on the tank. because this was all the amount that Aguirre had parted with when It must also be remembered that the he purchased said tank. It was judgment in Civil Case No. 24914 of the Leonora & Co. who had 5 spent the Court of First Instance of Manila, wherein sum of P11,299.00 for the Nassco was directed to pay to Aguirre the rehabilitation of said tank and of P900.00, in case delivery of the same against this amount Aguirre has no tank is no longer possible, has already rightful claim whatsoever. Of become final. This ruling cannot be course, in the event of delivery of disregarded in the present proceeding the tank to Aguirre as improved, it which involves the same parties and would be just for him to reimburse practically the same issue, arising from Leonora & Co. the sum of the same set of facts. P11,299.00. The trial court, therefore, acted properly in Nassco cannot also be compelled to pay denying Aguirre's claim to be paid more than P14,500.00 for the tank, the bid the fair and reasonable value of the offered by Leonora & Company and tank as improved in case the same accepted by this buyer, and which must could no longer be delivered to be the actual market value of the property him. at the time of its delivery to the latter. It has nothing to do at all with the various Aguirre filed the present petition for transactions or sales and the deprivation review, alleging that the judgment of the of Aguirre's right to possession of the tank, Court of Appeals, ordering the return to which culminated in this legal suit. him of the sum of P900.00 (when the value of the property is at least Wherefore finding no error in the decision P14,500.00), nullifies the declaration of his of the Court of Appeals under review, the ownership of the tank. He contends that present petition is hereby dismissed, with under Article 440 of the Civil Code, his costs against the petitioner. So ordered. ownership of the property entitles him to everything that is produced thereby, or is incorporated or attached thereto, either naturally or artificially. Thus, he reiterates the claim to the fair and reasonable value G.R. No. 157447. April 29, 2005 of the tank at the time of its delivery to NEMENCIO C. EVANGELISTA, PASCUAL Nassco which is P14,500.00. G. QUINTO, LUIS B. BUENA, EUSEBIA V. TABLADA, CANUTO G. TISBE, DAVID It is clear that we have here a case of R. CARULLO, SOFONIAS E. COLEGADO, accession by specification: Leonora and FELIX B. BUENA, TORIBIO C. Company, as purchaser acting in good EVANGELISTA, LEBRADA A. NICOLAS, faith, spending P11,299.00 for the ALECIA J. RAMOS, MILA G. DE LOS reconditioning of the tank which is later REYES, SALVADOR I. DE LA TORRE, adjudged to belong to petitioner Aguirre. MOISES CRUZ, RUFINO INFANTE, There is no showing that without the ALICIA ASTROLOGO, TRINIDAD works made by Leonora & Company, the LUMIQUED, LUZMINIDA QUINIQUINI, & tank in its original condition when Aguirre TEODORA C. TEMERAS, Petitioners, paid P900.00 therefor, would command vs. the price of P14,500 which Nassco was CARMELINO M. willing to pay. Although ordinarily, SANTIAGO, Respondents. therefore, Aguirre, as owner of the tank, DECISION would be entitled to any accession CHICO-NAZARIO, J.: thereto, the rule is different where the works or improvements or the accession In this Petition for Review under Rule 45 of was made on the property by one who the Rules of Court, petitioners pray for the acted in good faith.2 And, it is not reversal of the Decision of the Court of contended that the making of the Appeals in CA-G.R. CV No. improvements and incurring of expenses 64957,1 affirming the Order of the Regional Trial Court (RTC) of San Mateo, Rizal, to her son, respondent herein, who Branch 77, in Civil Case No. subsequently secured TCTs No. 281660, 1220,2 dismissing petitioners Complaint No. N-39258 and No. 205270 in his own for declaration of nullity of Original name.6 Certificate of Title (OCT) No. 670 and all other titles emanating therefrom. Petitioners filed with the trial court, on 29 April 1996, an action for declaration of In their Complaint, petitioners alleged that nullity of respondents certificates of title they occupied and possessed parcels of on the basis that OCT No. 670 was fake land, located in Sitio Panayawan, and spurious. Among the defects of OCT Barangay San Rafael, Montalban (now No. 670 pointed out by petitioners were Rodriquez), Province of Rizal (Subject that: (1) OCT No. 670 was not signed by a Property), by virtue of several Deeds of duly authorized officer; (2) Material data Assignment, dated 15 April 1994 and 02 therein were merely handwritten and in June 1994, executed by a certain Ismael different penmanships; (3) OCT No. 670 Favila y Rodriguez.3 was not printed on the Official Form used in 1913, the year it was issued; (4) It failed According to the Deeds of Assignment, the to indicate the Survey Plan which was the Subject Property was part of a vast tract of basis of the Technical Description of the land called "Hacienda Quibiga," which property covered by the title; (5) Decree extended to Paraaque, Las Pias, No. 10248 referred to in OCT No. 670 was Muntinlupa, Cavite, Batangas, Pasay, issued only on 11 April 1913, while OCT Taguig, Makati, Pasig, Mandaluyong, No. 670 was issued earlier, on 13 February Quezon City, Caloocan, Bulacan, and Rizal; 1913; and (6) Decree No. 10248 was awarded to Don Hermogenes Rodriguez by issued over a property other than the one the Queen of Spain and evidenced by a described in OCT No. 670, although also Spanish title. Ismael Favila claimed to be located in the Province of Rizal.7 one of the heirs and successors-in-interest of Don Hermogenes Rodriguez. Acting as Respondent filed his Answer with Prayer Attorney-in-Fact pursuant to a Special for Preliminary Hearing on the Affirmative Power of Attorney executed by his "mga Defenses on 03 July 1996. According to kapatid" on 25 February 1965, Ismael respondent, "[t]he allegations in the Favila signed the aforementioned Deeds of Complaint would readily and patently Assignment, assigning portions of the show that the same are flimsy, fabricated, Subject Property to the petitioners, each malicious, without basis in law and in portion measuring around 500 to 1,000 fact"8 square meters, in exchange for the labor As an affirmative defense, respondent and work done on the Subject Property by claimed that the petitioners had no legal the petitioners and their predecessors.4 capacity to file the Complaint, and thus, the Complaint stated no cause of action. Petitioners came by information that Since OCT No. 670 was genuine and respondent was planning to evict them authentic on its face, then OCT No. 670 from the Subject Property. Two of the and all of respondents land titles derived petitioners had actually received notices therefrom, are incontrovertible, to vacate. Their investigations revealed indefeasible and conclusive against the that the Subject Property was included in petitioners and the whole world.9 Transfer Certificates of Titles (TCTs) No. 53028, No. 281660, No. N-39258 and No. Citing the consolidated cases of Director of 205270, all originating from OCT No. 670, Forestry, et al. v. Hon. Emmanuel M. and now in the name of respondent.5 Muoz, et al. and Pinagcamaligan Indo- Agro Development Corporation v. Hon. OCT No. 670 was issued in the name of Macario Peralta, Jr., et al., 10 respondent respondents mother, Isabel Manahan y argued that the Spanish title, on which Francisco, and three other individuals, petitioners based their claim, was neither pursuant to Decree No. 10248, dated 13 indefeasible nor imprescriptible. Moreover, February 1913, in Case No. 8502 of the Presidential Decree (P.D.) No. 892, which Court of Land Registration of the Philippine took effect on 16 February 1976, required Islands. The whole property covered by all holders of Spanish titles or grants to OCT No. 670 was subsequently apply for registration of their lands under adjudicated in favor of Isabel Manahan Republic Act No. 496, otherwise known as Santiago (formerly Isabel Manahan y the Land Registration Act,11 within six Francisco). Consequently, OCT No. 670 months from effectivity of the decree. was cancelled and TCT No. T-53028 was After the given period, Spanish titles could issued exclusively in the name of Isabel no longer be used as evidence of land Manahan Santiago. On 28 December ownership in any registration proceedings 1968, Isabel Manahan Santiago executed a under the Torrens System. 12 Deed of Donation transferring the property Respondent also raised the affirmative Complaint. Pertinent portions of the Order defense of prescription. He pointed out of the trial court read: that any action against his certificates of title already prescribed, especially with After considering the testimonial and regard to OCT No. 670, which was issued documentary evidence presented, this in 1913 or more than 83 years prior to the Court is inclined not to grant plaintiffs (sic) filing of the Complaint by the petitioners. prayer. Finding credence and giving weight At the very least, respondent contended, to plaintiffs (sic) lone but "expert witness", "it must be presumed that the questioned it is crystal clear that, to quote: land titles were issued by the public 1. "a parcel of land titled illegally will officials concerned in the performance of revert to the State their regular duties and functions pursuant 2. it is the State who must file the to the law."13 corresponding case of annulment of title through the Office of the Solicitor General, Even assuming arguendo that the and petitioners entered and occupied the 3. a land illegally titled in the name of Subject Property, they did so as mere private individual, the State through the intruders, squatters and illegal occupants, Office of the Solicitor General should file bereft of any right or interest, since the the corresponding case for cancellation of Subject Property was already covered by title." (TSN August 26, 1997). Torrens certificates of title in the name of respondent and his predecessors-in- The above quoted testimony is straight interest.14 from horse (sic) mouth so to speak as this was the testimony of the plaintiffs (sic) Lastly, respondent denied knowing the expert witness. And judging from the said petitioners, much less, threatening to evict testimony alone aforecited, plaintiffs (sic) them. In fact, petitioners were not cause [of action] is bound to fail. "Plaintiffs included as defendants in Civil Case No. (sic) own testimony" wrote "finis" to their 783 entitled, "Carmelino M. Santiago v. case. From the record, this case was Remigio San Pascual, et al.," which initiated and filed by private individuals, respondent instituted before the same trial Nemencio Evangelista, et. al., court against squatters occupying the contradicting their witness (sic) testimony. Subject Property. In its decision, dated 01 To reiterate, this Court finds credence to July 1992, the trial court held that "there is the testimony of the plaintiffs (sic) no doubt that the plaintiff (respondent witness, i.e., is (sic) the State through the herein) is the owner of the land involved in Office of the Solicitor General who must this case on which the defendants have initiate and file a case of this nature when built their houses and shanties" title to a land is being claimed to be Although the decision in Civil Case No. 783 obtained through fraud and allegedly was appealed to the Court of Appeals, it spurious. had become final and executory for failure of the defendants-appellants therein to file The opinion of this Court anent the their appellants brief.15 testimony of the witness is not without basis. Explicit is the pronouncement of the In the instant case, the trial court held a Supreme Court in the recent case of Heirs preliminary hearing on the affirmative of Marciano Nagano v. Court of Appeals, to defenses as prayed for by the respondent. wit: During said hearing, petitioners presented their lone witness, Engineer Placido Naval, An action for reversion has to be instituted a supposed expert on land registration by the Solicitor General pursuant to laws. In response to questions from Section 101, Commonwealth Act No. 141. Honorable Judge Francisco C. Rodriguez of (282 SCRA 43). the trial court, Engineer Naval answered As to the documentary evidence, having that a parcel of land titled illegally would gone through with the "Deed of revert to the State if the Torrens title was Assignment/s" purportedly executed by cancelled, and that it was the State, and between a certain Ismael Favila y through the Office of the Solicitor General, Rodriguez and the plaintiffs, which is the that should file for the annulment or principal if not the only basis of plaintiffs cancellation of the title. Respondent, on claim ownership and possession of the the other hand, did not present any subject parcel of land, the same does not evidence but relied on all the pleadings hold water in a manner of speaking, for and documents he had so far submitted to being self-serving. "Assignor Ismael Favila the trial court.16 y Rodriguez" claimed in said Deed that he is the Attorney-in-Fact by virtue of an After the preliminary hearing, the trial alleged Special Power of Attorney court issued the questioned Order, dated executed in his favor by his "mga kapatid" 05 February 1999, dismissing petitioners on February 23, 1965, but said Special Power of Attorney was not presented After the trial court denied petitioners before this Court, thus there arises a Motion for Reconsideration in its Order, doubt as to its existence and execution dated 20 July 1999,18 petitioners appealed not to mention doubt on the existence of both Orders of the trial court to the Court his "mga kapatid" who as alleged of Appeals. executed said Special Power Attorney (sic) in his favor. The Court of Appeals, in its Decision, dated 29 July 2002,19 affirmed the Order of Even if this Court granting arguendo would the trial court, dated 05 February 1999, admit the authenticity of said "Deeds of dismissing petitioners Complaint. The Assignment/s", that will not alter the Court of Appeals denied petitioners outcome of the pending incident/s before Motion for Reconsideration in its this Court. Why? Because the said "Deed Resolution, dated 14 February 2003.20 of Assignment/s" which were based on Spanish title have lost their evidentiary Thus, petitioners filed this Petition for value pursuant to the Presidential Decree Review 21 under Rule 45 of the Rules of No. 892 i.e. "DISCONTINUANCE OF THE Court, raising the following issues and SPANISH MORTGAGE SYSTEM OF praying for the reversal of the REGISTRATION AND OF THE USE OF aforementioned Decision of the Court of SPANISH TITLES AS EVIDENCE IN LAND Appeals affirming the Order of dismissal of REGISTRATION PROCEEDINGS." the trial court:
I. Whether the lower courts
There is no need to elaborate on the dismissal of the petitioners above-cited provisions of PD 892 as they complaint should be proscribed are self-explanatory. Suffice it to say that by the rules of evidence it being there is no showing that plaintiffs based inter alia on Engr. Navals complied with the said law i.e. to apply testimony, which was for registration of their lands under Act No. indisputably not based on facts 496, otherwise known as the Land but conclusion of law. Registration Act, within six (6) months from the effectivity of this decree II. Whether the lower courts (February 16, 1976) Thereafter, Spanish dismissal of petitioners titles cannot be used as evidence of land complaint should be proscribed ownership in any registration proceedings by the rules of evidence it being under the Torrens System." done sans ample evidence except bare allegations of This being the case and likewise being respondent. clear that plaintiffs were not the lawful owners of the land subject of this case, for III. Whether the provision of P.D. they did not comply with PD 892, the said 892, i.e., Spanish titles cannot plaintiffs do not have the legal standing to be used as evidence of land bring before this Court the instant ownership in any registration complaint proceedings under the Torrens system, holds of an exception. Moreover, the principal issue in this case is for the declaration of nullity of defendants title, which has nothing to do with IV. Whether an action for quieting plaintiffs (sic) claim of ownership and of title, specifically where possession even if we set aside, albeit petitioners are in possession of momentarily, the truth that plaintiffs (sic) subject land, can be subject of claim were based on barred Spanish prescription. Title/s, and thus plaintiffs were never the owners of the parcel of land subject of this In his Comment,22 the respondent, for the case. most part, reiterated the findings of the trial court and the Court of Appeals. Further, defendants (sic) title especially so with the mother title OCT 670 was entered The Court believes that the trial court and issued in 1913 or more than Eighty rightfully dismissed petitioners Complaint, Three (83) years ago, the same not having but for reasons different from those relied been questioned by any party. Only now upon by the trial court and the Court of that it is being questioned, but sad to say, Appeals. plaintiffs who are on the offensive and relying on their lone expert witness, According to the respondent, petitioners instead of bolstering their case, had no legal capacity to file the Complaint, unwittingly sealed their fate 17 and thus, the Complaint filed before the trial court stated no cause of action. Before anything else, it should be clarified ground for dismissal of an action or that "the plaintiff has no legal capacity to affirmative defense is concerned: sue"23 and "the pleading asserting the claim states no cause of action"24 are two It is already well-settled by now that, in a different grounds for a motion to dismiss motion to dismiss a complaint based on or are two different affirmative defenses. lack of cause of action, the question Failure to distinguish between "the lack of submitted to the court for determination is legal capacity to sue" from "the lack of the sufficiency of the allegations of fact personality to sue" is a fairly common made in the complaint to constitute a mistake. The difference between the two is cause of action, and not on whether these explained by this Court in Columbia allegations of fact are true, for said motion Pictures, Inc. v. Court of Appeals:25 must hypothetically admit the truth of the Among the grounds for a motion to facts alleged in the complaint; that the dismiss under the Rules of Court are lack test of the sufficiency of the facts alleged of legal capacity to sue and that the in the complaint is whether or not, complaint states no cause of action. Lack admitting the facts alleged, the court of legal capacity to sue means that the could render a valid judgment upon the plaintiff is not in the exercise of his civil same in accordance with the prayer of rights, or does not have the necessary said complaint. Stated otherwise, the qualification to appear in the case, or does insufficiency of the cause of action must not have the character or representation appear in the face of the complaint in he claims. On the other hand, a case is order to sustain a dismissal on this dismissible for lack of personality to sue ground, for in the determination of upon proof that the plaintiff is not the real whether or not a complaint states a cause party-in-interest, hence grounded on of action, only the facts alleged therein failure to state a cause of action. The term and no other matter may be considered, "lack of capacity to sue" should not be and the court may not inquire into the confused with the term "lack of personality truth of the allegations, and find them to to sue." While the former refers to a be false before a hearing is had on the plaintiffs general disability to sue, such as merits of the case; and it is improper to on account of minority, insanity, inject in the allegations of the complaint incompetence, lack of juridical personality facts not alleged or proved, and use these or any other general disqualifications of a as basis for said motion. party, the latter refers to the fact that the plaintiff is not the real party- in-interest. In resolving whether or not the Complaint in the present case stated a cause of Correspondingly, the first can be a ground action, the trial court should have limited for a motion to dismiss based on the itself to examining the sufficiency of the ground of lack of legal capacity to sue; allegations in the Complaint. It was whereas the second can be used as a proscribed from inquiring into the truth of ground for a motion to dismiss based on the allegations in the Complaint or the the fact that the complaint, on the face authenticity of any of the documents thereof, evidently states no cause of referred or attached to the Complaint, action. since these are deemed hypothetically admitted by the respondent. The trial In the present case, this Court may court evidently erred in making findings as assume that the respondent is raising the to the authenticity of the Deeds of affirmative defense that the Complaint Assignment executed by Ismael Favila in filed by the petitioners before the trial favor of petitioners on 15 April 1994 and court stated no cause of action because 02 June 1994; and questioning the the petitioners lacked the personality to existence and execution of the Special sue, not being the real party-in-interest. It Power of Attorney in favor of said Ismael is the respondents contention that only Favila by his siblings on 25 February 1965. the State can file an action for annulment These matters may only be resolved after of his certificates of title, since such an a proper trial on the merits. action will result in the reversion of the ownership of the Subject Property to the Petitioners alleged in their Complaint, and State. respondent hypothetically admitted that: (1) Petitioners predecessors-in-interest, in The affirmative defense that the the concept of owners, had been in actual, Complaint stated no cause of action, physical, open, continuous and adverse similar to a motion to dismiss based on possession of the Subject Property against the same ground, requires the whole world since time immemorial; a hypothetical admission of the facts (2) The Subject Property was part of the alleged in the Complaint. In the case vast tract of land called "Hacienda of Garcon v. Redemptorist Fathers,26 this Quibiga" awarded to Don Hermogenes Court laid down the rules as far as this Rodriguez by the Queen of Spain by virtue of a Spanish title; (3) Ismael Favila, an heir Public Land Act, as amended by R.A. No. and successor-in-interest of Don 1942 Hermogenes Rodriguez, acting as Attorney-in-Fact pursuant to a Special Under Section 48, a subject lot is, for all Power of Attorney executed by his "mga legal intents and purposes, segregated kapatid" on 25 February 1965, executed from the public domain, because the Deeds of Assignment covering the Subject beneficiary is "conclusively presumed to Property in favor of petitioners; (4) have performed all the conditions Petitioners still occupied and possessed essential to a Government grant and shall the Subject Property, on which their be entitled to a certificate of title under houses were erected, when they the provisions of this chapter." discovered that the Subject Property was already covered by Torrens certificates of Consequently, merely on the basis of the title in the name of respondent; and (5) allegations in the complaint, the lot in That petitioners filed the Complaint to question is apparently beyond the prevent their eviction by the respondent. jurisdiction of the Director of the Bureau of To determine whether these allegations Lands and could not be the subject of a are sufficient to constitute a cause of Free Patent. Hence, dismissal of private action, it is important for this Court to respondents complaint was premature establish first the nature of petitioners and trial on the merits should have been action. conducted to thresh out evidentiary matters. Indeed, petitioners Complaint filed before the trial court was captioned as an action It would have been entirely different if the for declaration of nullity of respondents action were clearly for reversion, in which certificates of title. However, the caption case, it would have to be instituted by the of the pleading should not be the Solicitor General pursuant to Section 101 governing factor, but rather the of C.A. No. 141, which provides: allegations therein should determine the nature of the action, because even without Sec. 101. All actions for the reversion to the prayer for a specific remedy, the the Government of lands of the public courts may nevertheless grant the proper domain or improvements thereon shall be relief as may be warranted by the facts instituted by the Solicitor General or the alleged in the Complaint and the evidence officer acting in his stead, in the proper introduced.27 courts, in the name of the [Republic] of the Philippines. The trial court believed that petitioners action was ultimately one for reversion of In the more recent case of Heirs of the Subject Property to the public domain. Ambrocio Kionisala v. Heirs of Honorio Based on the testimony of Engineer Naval Dacut,30 the difference between an action and the case of Nagao v. Court of for declaration of nullity of land titles from Appeals,28 it declared that the State, an action for reversion was more represented by the Office of the Solicitor thoroughly discussed as follows: General, is the party-in-interest in an action for cancellation of a certificate of An ordinary civil action for declaration of title illegally issued in the name of a nullity of free patents and certificates of private individual, because the eventual title is not the same as an action for effect of such cancellation is the reversion reversion. The difference between them of the property to the State. lies in the allegations as to the character of ownership of the realty whose title is The Court disagrees in this sought to be nullified. In an action for pronouncement of the trial court, and calls reversion, the pertinent allegations in the for a far closer review of its decision complaint would admit State ownership of in Nagao v. Court of Appeals,29 wherein the disputed land. Hence, in Gabila vs. the Court held that Barriga [41 SCRA 131], where the plaintiff It is then clear from the allegations in the in his complaint admits that he has no complaint that private respondents claim right to demand the cancellation or ownership of the 2,250 square meter amendment of the defendants title portion for having possessed it in the because even if the title were canceled or concept of an owner, openly, peacefully, amended the ownership of the land publicly, continuously and adversely since embraced therein or of the portion 1920. This claim is an assertion that the affected by the amendment would revert lot is private land, or that even assuming it to the public domain, we ruled that the was part of the public domain, private action was for reversion and that the only respondents had already acquired person or entity entitled to relief would be imperfect title thereto under Section 48(b) the Director of Lands. of C.A. No. 141, otherwise known as the On the other hand, a cause of action for fraudulent, and a cloud on their title to the declaration of nullity of free patent and same property that needed to be certificate of title would require allegations removed. A cloud on title has been defined of the plaintiffs ownership of the as follows: contested lot prior to the issuance of such free patent and certificate of title as well Cloud on Title. A cloud on title is an as the defendants fraud or mistake, as outstanding instrument, record, claim, the case may be, in successfully obtaining encumbrance or proceeding which is these documents of title over the parcel of actually invalid or inoperative, but which land claimed by plaintiff. In such a case, may nevertheless impair or affect the nullity arises strictly not from the fraud injuriously the title to property. The matter or deceit but from the fact that the land is complained of must have a prima facie beyond the jurisdiction of the Bureau of appearance of validity or legal efficacy. Lands to bestow and whatever patent or The cloud on title is a semblance of title certificate of title obtained therefore is which appears in some legal form but consequently void ab initio. The real party- which is in fact unfounded. The invalidity in-interest is not the State but the plaintiff or inoperativeness of the instrument is not who alleges a pre-existing right of apparent on the face of such instrument, ownership over the parcel of land in and it has to be proved by extrinsic question even before the grant of title to evidence31 the defendant Even as this Court agrees with the petitioners that their action was one for In their Complaint, petitioners never removal of a cloud on or quieting of title, it alleged that the Subject Property was part does arrive at the same conclusion as the of the public domain. On the contrary, trial court and the Court of Appeals that petitioners asserted title over the Subject petitioners had no personality to file the Property by virtue of their actual, physical, said action, not being the parties-in- open, continuous and adverse possession interest, and their Complaint should be thereof, in the concept of owners, by dismissed for not stating a cause of action. themselves and through their predecessors-in-interest, since time According to Article 477 of the Civil Code, immemorial. The Deeds of Assignment the plaintiff, in an action to remove a executed in their favor and attached to cloud on or to quiet title, must have legal their Complaint referred to a Spanish title or equitable title to, or interest in, the real granted by the Queen of Spain to their property which is the subject matter of the predecessor-in-interest, Don Hermogenes action.32 Petitioners failed to establish in Rodriguez. Clearly, petitioners are their Complaint that they had any legal or asserting private title over the Subject equitable title to, or legitimate interest in, Property, and consequently, their action the Subject Property so as to justify their could not be one for reversion. right to file an action to remove a cloud on In their instant Petition, petitioners further or to quiet title. averred that rather than an action for nullity of respondents certificates of title, Title to real property refers to that upon theirs was more appropriately an action to which ownership is based. It is the remove a cloud on or to quiet their title evidence of the right of the owner or the over the Subject Property. extent of his interest, by which means he can maintain control and, as a rule, assert Article 476 of the Civil Code, on removal of right to exclusive possession and a cloud on or quieting of title, provides enjoyment of the property.33 that: In their Complaint, petitioners claimed title Art. 476. Whenever there is a cloud on to the Subject Property by virtue of their title to real property or any interest actual and continuous possession of the therein, by reason of any instrument, same since time immemorial, by record, claim, encumbrance or proceeding themselves and through their which is apparently valid or effective but is predecessors-in-interest. Yet, the Deeds of in truth and in fact invalid, ineffective, Assignment executed by Ismael Favila in voidable, or unenforceable, and may be their favor, attached to and an integral prejudicial to said title, an action may be part of their Complaint, revealed that brought to remove such cloud or to quiet petitioners predecessors-in-interest based the title. their right to the Subject Property on the An action may also be brought to prevent Spanish title awarded to Don Hermogenes a cloud from being cast upon title to real Rodriguez. property or any interest therein. There existed a contradiction when Respondents certificates of title over the petitioners based their claim of title to the Subject Property appeared valid or Subject Property on their possession effective; but according to the petitioners, thereof since time immemorial, and at the they were fake, spurious and/or same time, on the Spanish title granted to Don Hermogenes Rodriguez. Possession and vested.36 By virtue of P.D. No. 892, the since time immemorial carried the courts, in registration proceedings under presumption that the land had never the Torrens system, are precluded from been part of the public domain or accepting, confirming and recording a that it had been private property Spanish title. Reason therefore dictates even before the Spanish conquest. 34 If that courts, likewise, are prevented from the Subject Property was already private accepting and indirectly confirming such property before the Spanish conquest, Spanish title in some other form of action then it would have been beyond the power brought before them (i.e., removal of of the Queen of Spain to award or grant to cloud on or quieting of title), only short of anyone. ordering its recording or registration. To rule otherwise would open the doors to the The title to and possession of the Subject circumvention of P.D. No. 892, and give Property by petitioners predecessors-in- rise to the existence of land titles, interest could be traced only as far back recognized and affirmed by the courts, but as the Spanish title of Don Hermogenes would never be recorded under the Torrens Rodriguez. Petitioners, having acquired system of registration. This would portions of the Subject Property by definitely undermine the Torrens system assignment, could acquire no better title and cause confusion and instability in to the said portions than their property ownership that P.D. No. 892 predecessors-in-interest, and hence, their intended to eliminate. title can only be based on the same Petitioners argued that the Spanish title Spanish title. may still be presented as proof of Respondent maintained that P.D. No. 892 ownership on the basis of the exception prevents petitioners from invoking the provided in the fourth whereas clause of Spanish title as basis of their ownership of P.D. No. 892, which reads: the Subject Property. P.D. No. 892 strengthens the Torrens system by WHEREAS, Spanish titles to lands which discontinuing the system of registration have not yet been brought under the under the Spanish Mortgage Law, and by operation of the Torrens system, being categorically declaring all lands recorded subject to prescription, are now ineffective under the latter system, not yet covered to prove ownership unless accompanied by Torrens title, unregistered lands. It by proof of actual possession; . . . further provides that within six months from its effectivity, all holders of Spanish Since Petitioners alleged that they were in titles or grants should apply for actual possession of the Subject Property, registration of their land under what is then they could still present the Spanish now P.D. No. 1529, otherwise known as the title as evidence of their ownership of the Land Registration Decree. Thereafter, Subject Property. 37 Spanish titles can no longer be used as evidence of land ownership in any This Court cannot sustain petitioners registration proceedings under the Torrens argument. Actual proof of possession only system. 35 Indubitably, P.D. No. 892 divests becomes necessary because, as the same the Spanish titles of any legal force and whereas clause points out, Spanish titles effect in establishing ownership over real are subject to prescription. A holder of a property. Spanish title may still lose his ownership of the real property to the occupant who P.D. No. 892 became effective on 16 actually possesses the same for the February 1976. The successors of Don required prescriptive period.38 Because of Hermogenes Rodriguez had only until 14 this inherent weakness of a Spanish title, August 1976 to apply for a Torrens title in the applicant for registration of his their name covering the Subject Property. Spanish title under the Torrens system In the absence of an allegation in must also submit proof that he is in actual petitioners Complaint that petitioners possession of the real property, so as to predecessors-in-interest complied with P.D. discount the possibility that someone else No. 892, then it could be assumed that has acquired a better title to the same they failed to do so. Since they failed to property by virtue of prescription. comply with P.D. No. 892, then the successors of Don Hermogenes Rodriguez Moreover, legislative intent must be were already enjoined from presenting the ascertained from a consideration of the Spanish title as proof of their ownership of statute as a whole, and not just a the Subject Property in registration particular provision alone. A word or proceedings. phrase taken in the abstract may easily convey a meaning quite different from the Registration proceedings under the Torrens one actually intended and evident when system do not create or vest title, but only the word or phrase is considered with confirm and record title already created those with which it is associated. An apparently general provision may have a for this Court to address the issue of limited application if read together with prescription of the action. other provisions of the statute.39 Wherefore, this Court DENIES the instant The fourth whereas clause of P.D. No. 892 petition and AFFIRMS the Decision of the should be interpreted and harmonized Court of Appeals, dated 29 July 2002, and with the other provisions of the whole the Order of the Regional Trial Court of San statute.40 Note that the tenor of the whole Mateo, Rizal, Branch 77, dated 05 presidential decree is to discontinue the February 1999, dismissing petitioners use of Spanish titles and to strip them of Complaint for failure to state a cause of any probative value as evidence of action. ownership. It had clearly set a deadline for SO ORDERED. the filing of applications for registration of all Spanish titles under the Torrens system (i.e., six months from its effectivity or on 14 August 1976), after which, the Spanish titles may no longer be presented to prove ownership.
All holders of Spanish titles should have
filed applications for registration of their title on or before 14 August 1976. In a land registration proceeding, the applicant G.R. No. 167391 June 8, 2011 should present to the court his Spanish PHIL-VILLE DEVELOPMENT AND title plus proof of actual possession of the HOUSING CORPORATION, Petitioner, real property. However, if such land vs. registration proceeding was filed and MAXIMO BONIFACIO, CEFERINO R. initiated after 14 August 1976, the BONIFACIO, APOLONIO B. TAN, BENITA applicant could no longer present his B. CAINA, CRISPINA B. PASCUAL, Spanish title to the court to evidence his ROSALIA B. DE GRACIA, TERESITA S. ownership of the real property, regardless DORONIA, CHRISTINA GOCO AND of whether the real property was in his ARSENIO C. BONIFACIO, in their actual possession. capacity as the surviving heirs of the Therefore, the fact that petitioners were in late ELEUTERIA RIVERA VDA. DE actual possession of the Subject Property BONIFACIO,Respondents. when they filed the Complaint with the VILLARAMA, JR., J.: trial court on 29 April 1996 does not exclude them from the application of P.D. This petition for review on certiorari 1 seeks No. 892, and their Spanish title remain to set aside the Decision2 dated January inadmissible as evidence of their 31, 2005 and Resolution3dated March 15, ownership of the Subject Property, 2005 of the Court of Appeals in CA-G.R. SP whether in a land registration proceeding No. 62211. The Court of Appeals dismissed or in an action to remove a cloud on or to the Complaint4 for Quieting of Title and quiet title. Damages filed by Phil-Ville Development and Housing Corporation (Phil-Ville) and The preceding discussion does not bar denied its Motion for Reconsideration.5 holders of Spanish titles from claiming The factual antecedents, as culled from ownership of the real property on some the records, are as follows. other basis, such as those provided in either the Land Registration Decree 41 or Phil-Ville Development and Housing the Public Land Act.42Petitioners though Corporation is the registered owner of failed to allege any other basis for their three parcels of land designated as Lots 1- titles in their Complaint aside from G-1, 1-G-2 and 1-G-3 of the subdivision possession of the Subject Property from plan Psd-1-13-006209, located in Caloocan time immemorial, which this Court has City, having a total area of 8,694 square already controverted; and the Spanish meters and covered by Transfer title, which is already ineffective to prove Certificates of Title (TCT) Nos. ownership over the Subject Property. 270921,6 2709227 and 270923.8 Prior to their subdivision, the lots were collectively Therefore, without legal or equitable title designated as Lot 1-G of the subdivision to the Subject Property, the petitioners plan Psd-2731 registered in the name of lacked the personality to file an action for Phil-Ville under TCT No. T-148220. 9 Said removal of a cloud on, or quieting of, title parcels of land form part of Lot 23-A of the and their Complaint was properly Maysilo Estate originally covered by dismissed for failing to state a cause of Original Certificate of Title (OCT) No. action. In view of the dismissal of the case 99410 registered on May 3, 1917 in the on this ground, it is already unnecessary name of Isabel Gil de Sola as the judicial administratrix of the estate of Gonzalo A-2 of the Maysilo Estate. The case was Tuason and thirty-one (31) others. Phil-Ville docketed as CA-G.R. SP No. 43034 at the acquired the lots by purchase from N. Dela Court of Appeals. Merced and Sons, Inc. on July 24, 1984. Meanwhile, a writ of possession 16 was Earlier, on September 27, 1961, a group issued in Eleuteria Riveras favor on composed of Eleuteria Rivera, Bartolome December 26, 1996 upon the Order17of P. Rivera, Josefa R. Aquino, Gregorio R. Judge Discaya issued on the same date. Aquino, Pelagia R. Angeles, Modesta R. Accordingly, Sheriff Cesar L. Cruz served a Angeles, Venancio R. Angeles, Felipe R. Notice to Vacate18 dated January 2, 1997 Angeles Fidela R. Angeles and Rosauro R. upon Phil-Ville, requiring it to vacate Lots Aquino, claiming to be the heirs of Maria 23-A and 28. Bonifacio Shopping Center, de la Concepcion Vidal, a co-owner to the Inc., which occupied Lot 28-A-2, was also extent of 1-189/1000% of the properties served a copy of the notice. Aggrieved, covered by OCT Nos. 982, 983, 984, 985 Bonifacio Shopping Center, Inc. filed a and 994 of the Hacienda Maysilo, filed a petition for certiorari and prohibition, petition with the Court of First Instance docketed as CA-G.R. SP No. 43009, before (CFI) of Rizal in Land Registration Case No. the Court of Appeals. In a Decision19 dated 4557. They prayed for the substitution of February 19, 1997, the appellate court set their names on OCT No. 994 in place of aside and declared as void the Order and Maria de la Concepcion Vidal. Said petition Writ of Possession dated December 26, was granted by the CFI in an Order11 dated 1996 and the Notice to Vacate dated May 25, 1962. January 2, 1997. The appellate court explained that a party who has not been Afterwards, the alleged heirs of Maria de la impleaded in a case cannot be bound by a Concepcion Vidal filed a petition for the writ of possession issued in connection partition of the properties covered by OCT therewith. Nos. 982, 983, 984, 985 and 994. The case was docketed as Civil Case No. C-424 in Subsequently, on February 22, 1997, the CFI of Rizal, Branch 12, Caloocan City. Eleuteria Rivera Vda. de Bonifacio died at On December 29, 1965, the CFI granted the age of 96.20 the petition and appointed three commissioners to determine the most On April 23, 1997, the Secretary of Justice equitable division of the properties.12 Said issued Department Order No. 137 creating commissioners, however, failed to submit a special committee to investigate the a recommendation. circumstances surrounding the issuance of OCT No. 994 and its derivative titles. Thirty-one (31) years later, on May 22, 1996, Eleuteria Rivera filed a On April 29, 1997, the Court of Appeals Supplemental Motion13 in Civil Case No. C- rendered a Decision21 in CA-G.R. SP No. 424, for the partition and segregation of 43034 granting Rosauro R. Aquinos portions of the properties covered by OCT petition and setting aside the RTCs Order No. 994. The Regional Trial Court (RTC), of September 9, 1996, which granted Branch 120, of Caloocan City, through Eleuteria Riveras prayer for partition and Judge Jaime D. Discaya, to whom the case adjudicated in her favor portions of Lots was transferred, granted said motion. In 23, 28-A-1 and 28-A-2 of the Maysilo an Order14 dated September 9, 1996, Estate. The appellate court likewise set Judge Discaya directed the segregation of aside the Order and the Writ of Possession portions of Lots 23, 28-A-1 and 28-A-2 and dated December 26, 1996. ordered the Register of Deeds of Caloocan City to issue to Eleuteria Rivera new Nonetheless, on June 5, 1997, petitioner certificates of title over them. Three days filed a complaint for quieting of title and later, the Register of Deeds of Caloocan, damages against the surviving heirs of Yolanda O. Alfonso, issued to Eleuteria Eleuteria Rivera Vda. de Bonifacio (namely Rivera TCT No. C-31453715 covering a Maximo R. Bonifacio, Ceferino R. Bonifacio, portion of Lot 23 with an area of 14,391.54 Apolonia B. Tan, Benita B. Caina, Crispina square meters. On December 12, 1996, B. Pascual, Rosalia B. de Gracia, Teresita S. the trial court issued another Order Doronia, Christina B. Goco, Arsenio C. directing the acting Branch Clerk to issue Bonifacio, Carmen B. Bernardino and a Certificate of Finality of the Order dated Danilo C. Bonifacio) and the Register of September 9, 1996. Deeds of Caloocan City. The case was docketed as Civil Case No. C-507 in the Thereafter, one Rosauro R. Aquino filed a RTC of Caloocan City, Branch 122. petition for certiorari contesting said Order of December 12, 1996 and impugning the On October 7, 1997, then Senator Marcelo partial partition and adjudication to B. Fernan filed P.S. Resolution No. 1032 Eleuteria Rivera of Lots 23, 28-A-1 and 28- directing the Senate Committees on Justice and Human Rights and on Urban Committee Report No. 103124 dated May Planning, Housing and Resettlement to 25, 1998 that there is only one OCT No. conduct a thorough investigation, in aid of 994, registered on May 3, 1917, and that legislation, of the irregularities OCT No. 994, purportedly registered on surrounding the titling of the properties in April 19, 1917 (from which Eleuteria the Maysilo Estate. Riveras title originated) does not exist. The trial court also found that it was In a Decision22 dated March 24, 2000, the physically impossible for respondents to Caloocan RTC ordered the quieting of Phil- be the heirs of Eleuteria Riveras Villes titles over Lots 1-G-1, 1-G-2 and 1- grandmother, Maria de la Concepcion G-3, declaring as valid TCT Nos. 270921, Vidal, one of the registered owners of OCT 270922 and 270923 in Phil-Villes name. No. 994, because Maria de la Concepcion The fallo of said Decision reads: was born sometime in 1903, later than Eleuteria Rivera who was born in WHEREFORE, and in view of the foregoing, 1901.25 Lastly, the RTC pointed out that judgment is hereby rendered as follows: contrary to the contentions of Riveras 1. Ordering the quieting of title of heirs, there is no overlapping of titles the plaintiff over Lots 1-G-1, 1-G-2 inasmuch as Lot 23 lies far from Lot 23-A, and 1-G-3, all the subd. plan Psd-1- where Phil-Villes lands are located. 13-006209, being a portion of Lot On April 13, 2000, Atty. K.V. Faylona, on 1-G, Psd-2731, LRC Rec. No. 4429, behalf of respondents, addressed a situated in Kalookan City, as owner letter26 to the Branch Clerk of Court of the thereof in fee simple and with full Caloocan City RTC requesting the faith and credit; complete address of Phil-Ville and its 2. Declaring Transfer Ce[r]tificates counsel. Supposedly, respondents of Title Nos. 270921, 270922 and counsels of record, Attys. Nicomedes 270923 in the name of Phil-Ville Tolentino and Jerry D. Baares, had Development and Housing abandoned the defense but still kept the Corporation over the foregoing records of the case. Thus, the Notice of parcels of land issued by the Appeal27 on behalf of respondents was Registry of Deeds for Kalookan City, filed by Atty. Faylona while two of the as valid and effective; heirs, Danilo Bonifacio and Carmen 3. Declaring Transfer Certificate of Bernardino, filed a separate Notice of Title No. C-314537 over Lot 23, Appeal28 through their own counsel. The being a portion of Maysilo Estate appeals were consolidated and docketed situated in Maysilo, Kalookan City, as CA-G.R. CV No. 66547. in the name of Eleuteria Rivera, issued by the Registry of Deeds for On April 17, 2000, respondents withdrew Kalookan City, as null and void and their appeal and instead filed before this with no force and effect; Court a Petition for Review on 4. Ordering the private defendants Certiorari,29 which was docketed as G.R. to surrender to the Registry of No. 142640. In a Resolution 30 dated Deeds for Kalookan City, thru this September 25, 2000, the Court referred Court, the Owners Duplicate the petition to the Court of Appeals for Certificate of said Transfer adjudication on the merits since the case Certificate of Title No. C-314537 in does not involve pure questions of law. the name of Eleuteria Rivera; Respondents moved for reconsideration of 5. Directing the public defendant, the Resolution, but the Court denied their Register of Deeds of Kalookan City motion. Thus, respondents petition was to cancel both Transfer Certificate transferred to the Court of Appeals and of Title Nos. C-314537 in the name docketed as CA-G.R. SP No. 62211. of Eleuteria Rivera on file with the Register of Deeds for Kalookan Meanwhile, on October 17, 2002, the City, and the Owners Duplicate Court of Appeals rendered a Decision 31 in copy of Transfer Certificate of Title CA-G.R. CV No. 66547, dismissing the No. C-314537 being required to be appeal as regards Danilo Bonifacio and surrendered by the private Carmen Bernardino. Yet, along with Danilo defendants; and and Carmen, respondents moved for 6. Ordering the private defendants reconsideration on the contention that to pay plaintiff, jointly and they are not bound by the judgment since severally, the sum of 10,000.00, they had withdrawn their appeal therein. as and by way of attorneys fees, The Court of Appeals denied said motion plus the costs of suit. in a Resolution dated June 7, 2004. Danilo, SO ORDERED.23 Carmen and respondents elevated the case to the Supreme Court through a In upholding Phil-Villes titles, the trial Petition for Review on Certiorari, which court adopted the conclusion in Senate was docketed as G.R. No. 163397. Said petition, however, was denied by this DECLARE RESPONDENTS MAXIMO Court in a Resolution dated September 8, [BONIFACIO], ET AL. ALREADY IN 2004 for being filed out of time. ESTOPPEL TO RAISE THE SAID Subsequently, on January 31, 2005, the ISSUE OF JURISDICTION.35 Court of Appeals promulgated its assailed Decision in CA-G.R. SP No. 62211, setting Condensed, petitioner puts in issue the aside the RTC judgment and dismissing following: (1) whether the Court of Appeals Phil-Villes complaint. The appellate court committed grave abuse of discretion in held that the RTC had no jurisdiction to taking cognizance of respondents hear Phil-Villes complaint as it effectively petition; and (2) whether the Court of seeks to annul the Order dated May 25, Appeals committed grave abuse of 1962 of the CFI in LRC No. 4557, which discretion in declaring that the trial court directed the substitution of the late had no jurisdiction over Civil Case No. C- Eleuteria Rivera and her co-heirs in place 507. of Maria de la Concepcion Vidal as registered owners on OCT No. 994. The Pertinently, however, the genuine issue in appellate court likewise affirmed the this case is whether TCT No. C-314537 in validity of OCT No. 994 registered on April the name of Eleuteria Rivera constitutes a 19, 1917 citing the Supreme Court cloud over petitioners titles over portions Decisions in Metropolitan Waterworks and of Lot 23-A of the Maysilo Estate. Sewerage Systems v. Court of Appeals32 and Heirs of Luis J. Gonzaga v. Petitioner argues mainly that the Court of Court of Appeals33 as precedents. Appeals acted without jurisdiction in Phil-Ville sought reconsideration34 of the resolving respondents petition for review decision, but the Court of Appeals denied since it had dismissed their appeal in CA- its motion in the assailed Resolution dated G.R. CV No. 66547 for failure to file brief. March 15, 2005. Hence, this petition. Petitioner also points out that Petitioner alleges that: respondents petition is defective because I. Maximo Bonifacio alone signed its THE HONORABLE COURT OF verification and certification of non-forum APPEALS (FORMER NINTH shopping without proof that he was DIVISION) ACTED WITHOUT authorized to sign for the other JURISDICTION ON THE PETITION respondents. It contends that the ruling FOR REVIEW OF RESPONDENTS in MWSS v. Court of Appeals and Heirs of MAXIMO BONIFACIO, ET AL. IN CA- Gonzaga v. Court of Appeals will not G.R SP NO. 62211 BECAUSE OF THE invalidate its titles because it is not a EARLIER DISMISSAL OF THEIR party to any of said cases. As well, APPEAL IN CA-G.R NO. 66547. petitioner invokes the finding in the joint II. investigation by the Senate and the THE HONORABLE COURT OF Department of Justice (DOJ) that there is APPEALS (FORMER NINTH only one OCT No. 994, that is, the one DIVISION) ACTED WITHOUT registered on May 3, 1917. It maintains JURISDICTION ON THE PETITION that the trial court had jurisdiction to hear FOR REVIEW FILED BY its action since it is one for quieting of title RESPONDENTS MAXIMO and not for annulment of the CFI Order BONIFACIO, ET AL. IN CA-G.R. NO. dated May 25, 1962. SP 62211 WHICH DOES NOT RAISE PURE QUESTION[S] OF LAW OR Conversely, respondents rely on MWSS v. ISSUE[S] OF JURISDICTION AND Court of Appeals and Heirs of Gonzaga v. THEREFORE THE PROPER REMEDY Court of Appeals that upheld the titles AVAILABLE TO THEM IS ORDINARY emanating from OCT No. 994 registered on APPEAL WHICH, AS STATED, HAD April 19, 1917. Therefore, they insist that ALREADY BEEN DISMISSED IN CA- petitioner has no cause of action to seek G.R. CV NO. 66547. the nullification of their title which is a III. derivative of said OCT. Respondents THE HONORABLE COURT OF reiterate that since they had withdrawn APPEALS (FORMER NINTH their appeal in CA-G.R. CV No. 66547, the DIVISION) COMMITTED GRAVE Court of Appeals decision therein applies ABUSE OF DISCRETION only to Danilo Bonifacio and Carmen AMOUNTING TO LACK OR IN Bernardino. Lastly, they believe that EXCESS OF JURISDICTION IN petitioners action is one for annulment of HOLDING THAT THE TRIAL COURT judgment, which is foreign to the HAS NO JURISDICTION ON THE jurisdiction of the trial court. COMPLAINT FOR QUIETING OF TITLE FILED BY PETITIONER PHIL- Petitioner argues in its first two VILLE IN CIVIL CASE NO. C-507, OR assignments of errors that the Court of IN THE ALTERNATIVE, IN FAILING TO Appeals acted with grave abuse of discretion in entertaining respondents 36455 in LRC Case No. 4429 and petition. However, said contention said OCT 994 was registered with deserves scant consideration since the the Register of Deeds of Rizal on Court of Appeals, in CA-G.R. SP No. 62211, May 3, 1917. The Office of the properly assumed jurisdiction over Register of Deeds of Caloocan City respondents case after the same was or of Malabon or of Pasig City has referred to it by this Court through our no record of any OCT No. 994 that Resolution dated September 25, 2000. The was allegedly registered on April issue raised by respondents, as petitioners 19, 1917; in G.R. No. 142640, was purely a question 27.3. That said TCT No. C-314537 of fact that is beyond the power of this of the late Eleuteria Rivera could Court to resolve. Essentially, respondents not cover Lot 23-A or any portion/s asked the Court to determine the thereof because, as hereinbefore ownership of the lots purportedly covered recited, the whole of Lot 23-A had by petitioners titles. been totally disposed of as early as Neither do we find merit in petitioners July 24, 1923 and she and/or any of contention that the dismissal of the appeal her alleged predecessors-in- in CA-G.R. CV No. 66547 is binding on interest is not among those named respondents. The appellate court itself in the memorandum of recognized the withdrawal of appeal filed encumbrances of OCT No. 994 as by respondents, thus: vendees or vendors of said Lot 23- A;38 However, defendants Maximo R. Bonifacio, et al. withdrew their appeal so Ultimately, petitioner submits that a cloud that the only appellants herein are exists over its titles because TCT No. C- defendants-appellants Danilo R. Bonifacio, 314537 in the name of Eleuteria Rivera et al.36 purports to cover the same parcels of land covered by petitioners TCT Nos. 270921, So did the trial court err in taking 270922 and 270923. It points out that cognizance of petitioners action for what appears to be a valid and effective quieting of title contrary to respondents TCT No. C-314537 is, in truth, invalid assertion that it is actually one for because it covers Lot 23 which is not annulment of the CFI Order dated May 25, among those described in the OCT No. 994 1962? To this query, we rule in the on file with the Register of Deeds of Rizal negative. and registered on May 3, 1917. Petitioner notes that the OCT No. 994 allegedly The nature of an action is determined by registered on April 19, 1917 and from the material allegations of the complaint which TCT No. C-314537 was derived, is and the character of the relief sought by not found in the records of the Register of plaintiff, and the law in effect when the Deeds. In other words, the action seeks action was filed irrespective of whether he the removal of a cloud from Phil-Villes title is entitled to all or only some of such and/or the confirmation of its ownership relief.37 over the disputed properties as the successor-in-interest of N. Dela Merced In its complaint, petitioner alleges: and Sons, Inc. 27. That said TCT No. C-314537 of the late Eleuteria Rivera, although apparently valid Quieting of title is a common law remedy and effective, are in truth and in fact for the removal of any cloud upon, doubt, invalid and ineffective [;] or uncertainty affecting title to real 27.1. An examination of Decree No. property. Whenever there is a cloud on 36455 issued on April 19, 1917 in title to real property or any interest in real LRC Case No. 4429 and also of OCT property by reason of any instrument, No. 994 which was issued record, claim, encumbrance, or proceeding pursuant thereto will show that Lot that is apparently valid or effective, but is, 23 covered by the said TCT No. C- in truth and in fact, invalid, ineffective, 3145[3]7 of the late Eleuteria voidable, or unenforceable, and may be Rivera is not one of the 34 parcels prejudicial to said title, an action may be of land covered by said Decree No. brought to remove such cloud or to quiet 36455 and OCT 994; the title. In such action, the competent 27.2. That, as hereinbefore stated, court is tasked to determine the respective the same TCT No. C-314537 of the rights of the complainant and the other late Eleuteria Rivera is a direct claimants, not only to place things in their transfer from OCT No. 994 which proper places, and make the claimant, was registered on April 19, 1917. who has no rights to said immovable, The fact, however, is that there is respect and not disturb the one so only one OCT No. 994 which was entitled, but also for the benefit of both, so issued pursuant to Decree No. that whoever has the right will see every cloud of doubt over the property 1958 Jesus, dissipated, and he can thereafter Pacifico fearlessly introduce any desired Nepomuceno improvements, as well as use, and even , Sofia abuse the property.39 Nepomuceno , Soledad In order that an action for quieting of title Nepomuceno may prosper, two requisites must concur: de Jesus (1) the plaintiff or complainant has a legal or equitable title or interest in the real 81679 December Pacifico property subject of the action; and (2) the 15, 1960 Nepomuceno deed, claim, encumbrance, or proceeding , Sofia N. claimed to be casting cloud on his title Jugo, Soledad must be shown to be in fact invalid or N. de Jesus inoperative despite its prima facie appearance of validity or (8168 December Pacifico legal efficacy.40 0) 15, 1960 Nepomuceno 17745 & Co. As regards the first requisite, we find that C- April 21, Pacifico petitioner was able to establish its title 13794 1978 Nepomuceno over the real properties subject of this & Co. Inc. action. Petitioner submitted in evidence the Deed of Absolute Sale41 by which it C- May 16, N. de La acquired the subject property from N. Dela 14603 1978 Merced & Merced and Sons, Inc., as well as copies of Sons, Inc. OCT No. 994 dated May 3, 1917 and all T- April 22, Phil-Ville the derivative titles leading to the 14822 1987 Development issuance of TCT Nos. 270921, 270922 and 0 and Housing 270923 in petitioners name as follows: Corp.42 1avvphi1 Title Registrat Holder Petitioner likewise presented the Proyecto No. ion Date de particion de la Hacienda de Maysilo43 to 8004 July 24, Vedasto prove that Lot 23-A, of which petitioners 1923 Galino Lots 1-G-1, 1-G-2 and 1-G-3 form part, is among the 34 lots covered by OCT No. 994 8059 Septembe -ditto- registered on May 3, 1917. It produced tax r 3, 1923 receipts accompanied by a 8160 October -ditto- Certification44 dated September 15, 1997 24, 1923 issued by the City Treasurer of Caloocan stating that Phil-Ville has been religiously 8164 November Juan Cruz paying realty taxes on the lots. Its 6, 1923 Sanchez documentary evidence also includes a Plan45 prepared by the Chief of the 8321 February -ditto- Geodetic Surveys Division showing that 26, 1924 Lot 23-A of the Maysilo Estate is remotely 8734 Septembe Emilio situated from Lot 23 portion of the Maysilo r 11, 1924 Sanchez Estate. Petitioner ties these pieces of evidence to the finding in the DOJ 12946 November -ditto- Committee Report46 dated August 28, 21, 1927 1997 and Senate Committee Report No. 1031 dated May 25, 1998 that, indeed, 28315 July 16, Eastern there is only one OCT No. 994, that is, the 1935 Syndicate one registered on May 3, 1917. Mining Co., Inc. On the other hand, respondents have not 39163 November Royal adduced competent evidence to establish 18, 1939 Lawrence their title to the contested property or to Rutter dispute petitioners claim over the same. It must be noted that the RTC Order dated 43559 July 26, Mapua September 9, 1996 in Civil Case No. C- 1941 Institute of 424, which resulted in the issuance of TCT Technology No. C-314537 in the name of Eleuteria Rivera had long been set aside by the 18767 June 16, Sofia Court of Appeals in CA-G.R. SP No. 43034. 1950 Nepomuceno Clearly, respondents claim anchored 57541 March 13, Leona N. de primarily on TCT No. C-314537 lacks legal basis. Rather, they rely simply on the Courts pronouncement in MWSS v. Court April 1917, a title which we now of Appeals and Heirs of Gonzaga v. Court acknowledge as inexistent. Neither could of Appeals that OCT No. 994 registered on the conclusions in MWSS [and] Gonzaga May 3, 1917 and all titles emanating from with respect to an OCT No. 994 dated 19 it are void. April 1917 bind any other case operating under the factual setting the same as or The Supreme Court sustained said similar to that at bar. 49 (Emphasis decisions in the case of Manotok Realty, supplied.) Inc. v. CLT Realty Development Corporation47 promulgated on November Eventually, on March 31, 2009, the 29, 2005. In said case, the Court declared Supreme Court issued a void the titles of the Manotoks and Resolution50 reversing its Decision of Aranetas which were derived from OCT No. November 29, 2005 and declaring certain 994 registered on May 3, 1917 consistent titles in the names of Araneta and with its ruling in MWSSand Gonzaga. The Manotok valid. In the course of discussing Court disregarded the DOJ and Senate the flaws of Jose Dimsons title based on reports on the alleged anomalies his alleged 25% share in the hereditary surrounding the titling of the Maysilo rights of Bartolome Rivera, Eleuteria Estate. Riveras co-petitioner in LRC No. 4557, the However, on motion for reconsideration, Court noted: the Court issued a Resolution48 dated However, the records of these cases December 14, 2007 which created a would somehow negate the rights of Special Division of the Court of Appeals to Rivera to claim from Vidal. The Verification hear the consolidated cases on remand. Report of the Land Registration The Special Division was tasked to hear Commission dated 3 August 1981 showed and receive evidence, conclude the that Rivera was 65 years old on 17 May proceedings and submit to the Court a 1963 (as gathered from the records of Civil report on its findings as well as Case Nos. 4429 and 4496). It can thus be recommend conclusions within three deduced that, if Rivera was already 65 months from the finality of said Resolution. years old in 1963, then he must have been However, to guide the proceedings before born around 1898. On the other hand, the Special Division, the Court laid the Vidal was only nine (9) years in 1912; following definitive conclusions: hence, she could have been born only on [1903]. This alone creates an unexplained First, there is only one OCT 994. As it anomalous, if not ridiculous, situation appears on the record, that mother title wherein Vidal, Riveras alleged was received for transcription by the grandmother, was seven (7) years Register of Deeds on 3 May 1917, and that younger than her alleged grandson. should be the date which should be Serious doubts existed as to whether reckoned as the date of registration of the Rivera was in fact an heir of Vidal, for him title. It may also be acknowledged, as to claim a share in the disputed portions of appears on the title, that OCT No. 994 the Maysilo Estate.51 resulted from the issuance of the decree of registration on [19] April 1917, although The same is true in this case. The Death such date cannot be considered as the Certificate52 of Eleuteria Rivera reveals date of the title or the date when the title that she was 96 years old when she died took effect. on February 22, 1997. That means that she must have been born in 1901. That Second. Any title that traces its source makes Rivera two years older than her to OCT No. 994 dated [19] April 1917 alleged grandmother Maria de la is void, for such mother title is Concepcion Vidal who was born in 1903. inexistent. The fact that the Dimson and Hence, it was physically impossible for CLT titles made specific reference to an Eleuteria Rivera to be an heir of Maria de OCT No. 994 dated [19] April 1917 casts la Concepcion Vidal. doubt on the validity of such titles since Moreover, the Partition Plan of the Maysilo they refer to an inexistent OCT. This error Estate shows that Lot 23-A was awarded, alone is, in fact, sufficient to invalidate the not to Maria de la Concepcion Vidal, but to Dimson and CLT claims over the subject Isabel Tuason, Esperanza Tuason, Trinidad property if singular reliance is placed by Jurado, Juan O Farrell and Angel O them on the dates appearing on their Farrell.53 What Vidal received as her share respective titles. were Lot 6 and portions of Lots 10 and 17, all subject to the usufructuary right of her Third. The decisions of this Court in MWSS mother Mercedes Delgado. This was not at v. Court of Appeals and Gonzaga v. Court all disputed by respondents. of Appeals cannot apply to the cases at bar, especially in regard to their On the other hand, Vedasto Galino, who recognition of an OCT No. 994 dated 19 was the holder of TCT No. 8004 registered on July 24, 1923 and to whom petitioner Bounded on the NW., along line 1-2 by Blk. traces its titles, was among the successful 2; on the SW., along line 2-3 by Jacinto petitioners in Civil Case No. 391 Street, along lines 3-4-5 by Blk. 4; along entitled Rosario Negrao, et al. v. line 5-6 by Bustan St., and San Diego Concepcion Vidal, et al., who sought the St., on the S., along lines 6-7-8 by Blk. 13, issuance of bills of sale in favor of the all of Caloocan Cadastre; on the NE., along actual occupants of certain portions of the line 8-9 by Caloocan Cadastre; and on the Maysilo Estate. N., along line 9-1 by Epifanio de los Santos Avenue. Beginning at a point Be that as it may, the second requisite in marked "1" on plan, being S. 28 deg. an action for quieting of title requires that 30E., 530.50 m. from MBM No. 1, the deed, claim, encumbrance, or Caloocan Cadastre; thence S. 07 deg. proceeding claimed to be casting cloud on 20W., 34.00 m. to point 2; S. 17 deg. his title must be shown to be in fact invalid 10E., 12.00 m. to point 3; (0/illegible) or inoperative despite S. 15 deg. 31E., 31.00 m. to point its prima facie appearance of validity or 4; S. 27 deg. 23E., 22.50 m. to legal efficacy. Article 476 of the Civil point 5; Code provides: S. 38 deg. 41E., 43.20 m. to point 6; S. 71 deg. 35E., 10.60 m. to Art. 476. Whenever there is a cloud on point 7; title to real property or any interest N. 84 deg. 30E., 38.80 m. to point therein, by reason of any instrument, 8; N. 11 deg. 40W., 131.20 m. to record, claim, encumbrance or proceeding point 9; which is apparently valid or effective but is N. 89 deg. 10W., 55.00 m. to the in truth and in fact invalid, ineffective, point of beginning; containing an voidable, or unenforceable, and may be area of FOURTEEN THOUSAND prejudicial to said title, an action may be THREE HUNDRED NINETY ONE brought to remove such cloud or to quiet SQUARE METERS AND FIFTY the title. FOUR SQUARE DECIMETERS (14,391.54). more or less. All An action may also be brought to prevent points referred to are indicated on a cloud from being cast upon title to real the plan and are marked on the property or any interest therein. ground by Old Ps. cyl. conc. mons. 15 x 60 cm.; bearings Thus, the cloud on title consists of: (1) any true;54 (Emphasis supplied). instrument, record, claim, encumbrance or proceeding; (2) which is apparently valid On the other hand, the technical or effective; (3) but is in truth and in fact description of petitioners lands before invalid, ineffective, voidable, or they were subdivided under TCT No. T- unenforceable; and (4) may be prejudicial 148220 is as follows: to the title sought to be quieted. The fourth element is not present in the case A parcel of land (Lot No. 1-G of the at bar. subdivision plan Psd-2731, being a portion of Lot 23-A, Maysilo Estate, GLRO Rec. While it is true that TCT No. C-314537 in No. 4429), situated in the Municipality of the name of Eleuteria Rivera is an Caloocan, Province of Rizal. Bounded on instrument that appeared to be valid but the North., by Calle A. Samson; on the was subsequently shown to be invalid, it East., by properties of Gregoria de does not cover the same parcels of land Jesus, Arcadio de Jesus and Felix de that are described in petitioners titles. Jesus; on the South., by properties of Foremost, Riveras title embraces a land Lucas Bustamante and Patricio measuring 14,391.54 square meters while Galauran; and on the West., by property petitioners lands has an aggregate area of Patricio Galauran; and Lot No. 1-E of of only 8,694 square meters. On the one the subdivision plan. Beginning at a point hand, it may be argued that petitioners marked "1" on plan, being N.69 deg. 27E., land could be subsumed within Riveras 1600.19 m. from BLLM No. 1, Mp. of 14,391.54-square meter property. Yet, a Caloocan, more or less, thence S. 21 deg. comparison of the technical descriptions of 25E., 44.78 m. to point 2; thence S. 14 the parties titles negates an overlapping deg. 57E., 37.24 m. to point 3; thence S. of their boundaries. 81 deg. 11W., 20.28 m. to point 4; thence S. 86 deg. 06W., 15.45 m. to point 5; The technical description of respondents thence N. 67 deg. 20W., 15.91 m. to point TCT No. C-314537 reads: 6; thence N. 35 deg. 19W., 37.56 m. to point 7; thence N. 27 deg. 11W., 12.17 m. A parcel of land (Lot 23, being a portion of to point 8; thence N. 19 deg. 26W., 23.32 Maysilo Estate) situated in Maysilo, m. to point 9; thence N. 13 deg. 08W., Caloocan, Metro Manila, Island of Luzon. 28.25 m. to point 10; thence S. 78 deg. 45W., 13.00 m. to point 11; thence N. 0 Declaratory Relief. Section 1 of Rule 63 deg. 56E., 48.92 m. to point 12; thence N. provides: 89 deg. 13E., 53.13 m. to point 13; thence S. 21 deg. 24E., 67.00 m. to the point of SECTION 1. Who may file petition.-Any beginning; containing an area of EIGHT person interested under a deed, will, THOUSAND SIX HUNDRED NINETY contract or other written instrument, FOUR (8,694) SQUARE METERS, more whose rights are affected by a statute, or less. All points referred to are indicated executive order or regulation, ordinance or on the plan and are marked on the ground any other governmental regulation points 1,2,3 and 13 by Old PLS conc. may, before breach or mons. point 4,6,7,8 and 9 by Old PLS violation thereof, bring an action in the stone mons.; points 5 to 10 and old stakes appropriate Regional Trial Court to points 11 and 12 by PLS conc. mons. determine any question of construction bearings true, declination 1 deg. 08E., or validity arising, and for a date of the original survey, Sept. 8-27, declaration of his rights or duties, Oct. 4-21 and Nov. 17-18, 1911 and that of thereunder. the subdivision survey, Oct. 14 and 15, 1927.55 (Emphasis supplied). An action for the reformation of an instrument, to quiet title to real Such disparity in location is more vividly property or remove clouds therefrom, illustrated in the Plan prepared by Engr. or to consolidate ownership under Article Privadi J.G. Dalire, Chief of the Geodetic 1607 of the Civil Code, may be brought Surveys Division, showing the relative under this Rule. (Emphasis supplied). positions of Lots 23 and 23-A. As it appears on the Plan, the land covered by An action for declaratory relief respondents TCT No. C-314537 lies far presupposes that there has been no actual west of petitioners lands under TCT Nos. breach of the instruments involved or of 270921, 270922 and 270923. Strictly the rights arising thereunder. Since the speaking, therefore, the existence of TCT purpose of an action for declaratory relief No. C-314537 is not prejudicial to is to secure an authoritative statement of petitioners titles insofar as it pertains to a the rights and obligations of the parties different land. under a statute, deed, or contract for their guidance in the enforcement thereof, or Significantly, an action to quiet title is compliance therewith, and not to settle characterized as a proceeding quasi in issues arising from an alleged breach rem.56 In an action quasi in rem, an thereof, it may be entertained before the individual is named a defendant and the breach or violation of the statute, deed or purpose of the proceeding is to subject his contract to which it refers. A petition for interests to the obligation or loan declaratory relief gives a practical remedy burdening the property. Actions quasi in for ending controversies that have not rem deal with the status, ownership or reached the state where another relief is liability of a particular property but which immediately available; and supplies the are intended to operate on these need for a form of action that will set questions only as between the particular controversies at rest before they lead to a parties to the proceedings and not to repudiation of obligations, an invasion of ascertain or cut off the rights or interests rights, and a commission of wrongs. of all possible claimants. The judgment therein is binding only upon the parties In the present case, petitioner filed a who joined in the action.57 complaint for quieting of title after it was served a notice to vacate but before it Yet, petitioner was well aware that the lots could be dispossessed of the subject encompassed by its titles are not the properties. Notably, the Court of Appeals, same as that covered by respondents in CA-G.R. SP No. 43034, had earlier set title. In its complaint, Phil-Ville alleges: aside the Order which granted partial partition in favor of Eleuteria Rivera and 27.4. That Lot 23, being a portion of the Writ of Possession issued pursuant Maysilo Estate, as described in said TCT thereto. And although petitioners No. C-314537 of the late Eleuteria Rivera complaint is captioned as Quieting of Title when plotted using its tie line to MBM No. and Damages, all that petitioner prayed 1, Caloocan Cadastre is outside Lot 23-A of for, is for the court to uphold the validity the Maysilo Estate. This must be so of its titles as against that of respondents. because Lot 23 is not [a] portion of Lot 23- This is consistent with the nature of the A, Maysilo Estate.58 relief in an action for declaratory relief where the judgment in the case can be This brings petitioners action within the carried into effect without requiring the purview of Rule 63 of the Rules of Court on parties to pay damages or to perform any act.59 Thus, while petitioner was not able to demonstrate that respondents TCT No. C- 314537 in the name of Eleuteria Rivera constitutes a cloud over its title, it has nevertheless successfully established its ownership over the subject properties and the validity of its titles which entitles it to declaratory relief.
WHEREFORE, the petition for review on
certiorari is GRANTED. The Decision dated January 31, 2005 and Resolution dated March 15, 2005 of the Court of Appeals in CA-G.R. SP No. 62211 are SET ASIDE. The Decision dated March 24, 2000 of the Caloocan RTC in Civil Case No. C-507 is hereby REINSTATED and UPHELD.