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Jurisprudence on Acquisitive Prescription

1) G.R. No. 169898 October 27, 2006

SPOUSES ANITA AND HONORIO AGUIRRE, petitioners,


vs.
HEIRS OF LUCAS VILLANUEVA, NAMELY: JOSE T. VILLANUEVA, PABLO T.
VILLANUEVA, PEDRO T. VILLANUEVA, RODOLFO T. VILLANUEVA, DELIA V. DELA
TORRE, JUANITA V. INGLES, & SABELITO V. GELITO, respondents.

DECISION

YNARES-SANTIAGO, J.:

This petition for review on certiorari under Rule 45 of the Rules of Court assails the
Decision1 dated March 17, 2005 of the Court of Appeals in CA-G.R. CV No. 72530 which
affirmed the Decision2 dated August 6, 2001 of the Regional Trial Court of Kalibo, Aklan, Branch
8, in Civil Case No. 5745, declaring private respondents as absolute owners of the subject
parcel of land. Likewise assailed is the September 20, 2005 Resolution3 denying petitioners’
motion for reconsideration.

A complaint for annulment or declaration of nullity of deed of exchange, tax declarations and
recovery of ownership and possession with damages was filed by private respondents against
petitioners.

Private respondents alleged that they are the legitimate children and grandson of the late
spouses Lucas Villanueva and Regina Tupas Villanueva; that during the lifetime of Lucas
Villanueva, he owned a parcel of residential land designated as Lot 764-A situated at Barangay
Balabag, Malay, Aklan with an area of 140 square meters, more or less, and declared for
taxation purposes under his name under Tax Declaration No. 252 (1947); that spouses
Villanueva possessed the subject parcel of land during their lifetime openly, publicly and
continuously in the concept of an owner and after their death, they were succeeded by their
children; that sometime in August 1997, petitioners and their hired laborers fenced the whole
land in question without the knowledge and consent of private respondents; that when
confronted by private respondents concerning the fencing of the land, petitioners alleged that
they acquired the same through inheritance from their father, Eutiquiano Salazar, who in turn
purchased the land from the late Ciriaco H. Tirol by virtue of a Deed of Exchange of Real
Property.

In their Answer,4 petitioners claimed that petitioner Anita S. Aguirre is the lawful owner and
actual possessor of the land in question, it being a portion of a bigger parcel of land she
inherited from her deceased parents Eutiquiano Salazar and Regina Supetran Salazar who
bought the land from Ciriaco H. Tirol per Deed of Exchange of Real Property5 dated December
31, 1971 and registered in the Office of the Register of Deeds of Aklan; that the parcel of land is
included under Tax Declaration No. 4033 (1953) in the name of Trinidad vda. de Tirol and the
same is in the possession of the Tirol family as owner thereof continuously, openly and
adversely even before the second world war; that the land had been surveyed as part of
Cadastral Lot 764, NP-06-000001, Malay Cadastre, in the name of Eutiquiano Salazar by the
Bureau of Lands; that the land has been declared under Tax Declaration No. 1264 (1974) and
subsequent tax declarations in the name of Eutiquiano Salazar; that the land was first fenced
with bamboos in 1981 and with cement hollow blocks in 1985 without any opposition from
private respondents; and that the action is barred by prescription and private respondents are
guilty of laches in failing to assert their alleged right of ownership after the lapse of more than
fifty (50) years since it was possessed by the heirs of the late Trinidad vda. de Tirol.

On August 6, 2001, the trial court rendered judgment, the dispositive portion of which reads:

WHEREFORE, premises considered, judgment is hereby rendered:

1. Declaring the plaintiffs the lawful owners and entitled to possession of the land
in question identified as Lot 764-A in the Commissioner's Sketch marked Exhibit
"L", and as owners, are entitled to the possession of the same;

2. Ordering the defendants to restore possession of the land in question to the


plaintiffs;

3. Ordering the defendants to pay the plaintiffs the sum of One Thousand Eight
Hundred Pesos (P1,800.00) by way of litigation expenses, and another sum of
Fifteen Thousand Pesos (P15,000.00) as reimbursement for attorney's fees; and

4. Ordering the Provincial Assessor of Aklan to issue a new tax declaration of the
land in question in the name of the plaintiffs upon compliance of the requirements
of that office and upon payment of appropriate taxes on the land including back
taxes, if any.

For insufficiency of evidence, plaintiffs claim for moral damages is denied and for lack of
merit, defendants counterclaim is DISMISSED.

With cost against the defendants.

SO ORDERED.6

The trial court noted that the tax declarations in the name of Trinidad vda. de Tirol and the
survey plan did not establish the fact that Ciriaco Tirol is the owner and possessor of the land in
question, thus, he has no right to transfer ownership of the same to Eutiquiano Salazar; that
petitioners were not possessors in good faith since they knew as early as 1954 that private
respondents were in possession of the land; that petitioners did not acquire the land via
extraordinary acquisitive prescription considering that their possession only lasted for 26 years
from 1971 up to 1997 when private respondents first instituted the complaint.

On March 17, 2005, the Court of Appeals rendered a decision denying petitioners’ appeal and
affirming in toto the trial court’s decision.
Petitioners’ motion for reconsideration was denied hence this petition raising the following
issues:

I. THE COURT OF APPEALS ERRED IN NOT FINDING THAT THE AGUIRRES HAD
ACQUIRED TITLE OVER THE DISPUTED PROPERTY VIA ORDINARY ACQUISITIVE
PRESCRIPTION;

II. THE COURT OF APPEALS ERRED IN NOT FINDING THAT THE VILLANUEVAS’
CAUSE OF ACTION HAD BEEN BARRED BY PRESCRIPTION;

III. THE COURT OF APPEALS ERRED IN REFUSING TO APPLY THE EQUITABLE


RULE ON LACHES;

IV. THE COURT OF APPEALS ERRED IN FINDING THAT THE VILLANUEVAS WERE
IN "POSSESSION" AND "OWNERSHIP" OF THE DISPUTED PROPERTY PRIOR TO
THE EXECUTION OF THE DEED OF EXCHANGE BETWEEN CIRIACO TIROL AND
THE AGUIRRES’ ASCENDANT-PREDECESSOR IN 1971;

V. THE COURT OF APPEALS ERRED IN RULING THAT THE AGUIRRES HAVE NOT
PROVED THE ROOT OF THEIR RIGHT OF OWNERSHIP OVER THE DISPUTED
PROPERTY; AND

VI. THE COURT OF APPEALS ERRED IN NOT APPRECIATING FOR THE AGUIRRES
THE FACT THAT THE LATTER HAD "JUST TITLE," AND HAD BEEN IN POSSESSION
OF THE DISPUTED PROPERTY "IN GOOD FAITH" SINCE 1971.7

We find merit in the petition.

This Court is not a trier of facts. However, if the inference drawn by the appellate court from the
facts is manifestly mistaken, as in the instant case, we can review the evidence in order to arrive
at the correct factual conclusions based on the record.8

Prescription, in general, is a mode of acquiring (or losing) ownership and other real rights
through the lapse of time in the manner and under conditions laid down by law, namely, that the
possession should be in the concept of an owner, public, peaceful, uninterrupted and adverse.
Acquisitive prescription is either ordinary or extraordinary. Ordinary acquisitive prescription
requires possession in good faith and with just title for 10 years. Without good faith and just title,
acquisitive prescription can only be extraordinary in character which requires uninterrupted
adverse possession for 30 years.9

Thus, for ordinary acquisitive prescription to set in, possession must be for at least 10 years, in
good faith and with just title. Possession is "in good faith" when there is a reasonable belief that
the person from whom the thing is received has been the owner thereof and could thereby
transmit his ownership.10 There is "just title" when the adverse claimant comes into possession
of the property through any of the modes recognized by law for the acquisition of ownership or
other real rights, but the grantor is neither the owner nor in a position to transmit the right. 11

In the instant case, we find sufficient evidence to support petitioners’ claim that the requirements
for ordinary prescription are present.
The trial court found that petitioners’ possession was for more than 10 years and with just title,
thus:

There is no question that the defendants have been in public, and uninterrupted
possession of the land in question in the concept of an owner for a span of twenty six
(26) years from the time the land in question was included in the deed of exchange in
1971 up to the time the plaintiffs complained in 1997 (Exh. "K"). There is also no
question that defendants’ possession of the land in question was with just title. Just title
in the sense that the defendants acquired the land in question by way of exchange which
is one of the modes recognized by law in acquiring ownership.12

Contrary however to the findings of the trial court, petitioners possessed the property in good
faith. Petitioner Anita Aguire’s father, Eutiquiano Salazar, bought the subject property from
Ciriaco Tirol, whose claim on the property is founded on the following documents: (1) Tax
Declaration No. 729 in the name of Trinidad vda. de Tirol for the year 1945 (Exhibit "4"); (2) Tax
Declaration No. 4033 in the name of Trinidad vda. de Tirol for the year 1953 (Exhibit "4-A"); and
(3) the survey plan approved by the Bureau of Lands in 1952 (Exhibit "6"). Thus, petitioners
honestly believed that ownership of the subject parcel of land was transmitted to Anita by
succession from his deceased father, and who thereafter possessed the property and exercised
dominion over it.

Likewise, the trial court’s finding that petitioner Anita Aguirre was not a possessor in good faith
since she knew as early as 1954 that private respondents were in possession of the disputed
land has no basis. Anita Aguirre testified that Magdalena Tupas built a house in the
controverted property in 1957 with the permission of Bernardo Escalante, the administrator of
the Tirols.13

To prove their ownership, petitioners presented Tax Declaration No. 1264 for the year 1974
(Exhibit "4-B") and other tax declarations (Exhibits "4-C, "4-D", "5" and submarkings) for the
year 1980 to 1994, in the name of Eutiquiano Salazar declaring the subject land for taxation
purposes. While tax declarations and receipts are not conclusive evidence of ownership and do
not prove title to the land, nevertheless, when coupled with actual possession, they constitute
evidence of great weight and can be the basis of a claim of ownership through prescription.14

Records also show that Lucas Villanueva, private respondents’ predecessor-in-interest, did not
actually possess the subject property during his lifetime. Private respondent Delia Villanueva
Dela Torre, testified that her parents while still alive resided in Sitio Din-iwid, Balabag, Malay,
Aklan, about less than a kilometer away from the land in question. 15 Neither did any of the
private respondents ever reside therein.16 The actual possession by the private respondents
rests solely on the possession of Magdalena Tupas and her husband for eight years allegedly
with the permission of Regina Tupas Villanueva. However, the testimonies of Rubio Sastre and
Magdalena Tupas regarding the actual possession of Lucas Villanueva through planting of trees
and gathering of fruits cannot be given full weight and credence because the witnesses were of
tender years then, barely seven or twelve years old, and did not have discernment of the
concept of possession and ownership. Moreover, no evidence was presented on how Lucas
Villanueva acquired the land in question from Eusebio Sacapano, the uncle of Regina Tupas
Villanueva. In addition, Tax Declaration No. 252 for the year 1947 (Exhibit "C") in the name of
Lucas Villanueva does not have probative value since it was executed four years after the death
of Lucas Villanueva in 1943. Tax receipts submitted by the private respondents in payment for
the year 1986 up to 1996 were actually paid on the same day, February 20, 1996 by his son
Dionito Villanueva.17

On the other hand, after buying the property in 1971, petitioners possessed the same in the
concept of an owner. They peacefully occupied it, built fences, planted plants and used the
same as ingress and egress towards their cottages. Having been in continuous possession and
enjoyment of the disputed land in good faith and with a just title since 1971 until 1997,
petitioners doubtlessly obtained title by ordinary acquisitive prescription.

Moreover, the action is barred by laches which is defined as the failure to assert a right for an
unreasonable and unexplained length of time, warranting a presumption that the party entitled to
assert it has either abandoned or declined to assert it. This equitable defense is based upon
grounds of public policy, which requires the discouragement of stale claims for the peace of
society.18

In the instant case, private respondents knew as early as 1981 that petitioners are building
fences in the perimeter of the disputed land but did not take action to assert their rights over the
subject parcel of land. They waited 16 long years to oust petitioners from the possession of the
land. Definitely, laches had already set in.

WHEREFORE, the petition is GRANTED. The Decision dated March 17, 2005 of the Court of
Appeals in CA-G.R. CV No. 72530, affirming the decision of the Regional Trial Court of Kalibo,
Aklan, Branch 8, in Civil Case No. 5745, is hereby REVERSED and SET ASIDE. Petitioners are
hereby DECLARED as lawful owners of the subject property through acquisitive prescription.

SO ORDERED.

Panganiban, C.J. (Chairperson), Austria-Martinez, Callejo, Sr., and Chico-Nazario

Footnotes

1
Rollo, pp. 57-62. Penned by Associate Justice Isaias P. Dicdican and concurred in by
Associate Justices Vicente L. Yap and Enrico A. Lanzanas.

2
Id. at 82-108. Penned by Judge Eustaquio G. Terencio.

3
Id. at 63-64.

4
Id. at 76-81.

5
Id. at 73-74.

6
Id. at 107-108.

7
Id. at 19-20.
8
Heirs of Flores Restar v. Heirs of Dolores R. Cichon, G.R. No. 161720, November 22,
2005, 475 SCRA 731, 739.

9
Heirs of Segunda Maningding v. Court of Appeals, 342 Phil. 567, 574 (1997); See also
CIVIL CODE, Arts. 1117, 1134 & 1137.

10
Id., Art. 1127.

11
Id., Art. 1129.

12
Rollo, p. 105.

13
TSN, May 16, 2000, p. 15.

14
Heirs of Flores Restar v. Heirs of Dolores R. Cichon, supra note 8 at 741.

15
TSN, October 8, 1999, p. 7.

16
Id. at 25-26.

17
TSN, December 2, 1999, p. 13.

18
Vda. De Rigonan v. Derecho, G.R. No. 159571, July 15, 2005, 463 SCRA 627, 648.
2) G.R. No. 159571. July 15, 2005
DELFINA Vda. de RIGONAN and Spouses VALERIO LAUDE and VISMINDA
LAUDE, petitioners, vs. ZOROASTER DERECHO Representing the Heirs of RUBEN
DERECHO, ABEL DERECHO, HILARION DERECHO, NUNELA D. PASAOL, EFRAIM
DERECHO, NOEL DERECHO, CORAZON D. OCARIZA Representing the Heirs of Marcial
Derecho, LANDILINO D. PRIETO Representing the Heirs of Pilar D. Prieto, JUSTA D.
BUENO, ADA D. MAPA, EMMANUEL DERECHO, POMPOSO DERECHO Representing
the Heirs of Apolinar Derecho, VICENTE D. RIGONAN, RUFA D. JAYME Representing the
Heirs of Gerardo Derecho, MARDONIO D. HERMOSILLA Representing the Heirs of Oliva
D. Hermosilla, respondents.

DECISION
PANGANIBAN, J.:

Owners who, for a long period of time, fail to assert their rights to unregistered real property
may be deprived of it through prescription. Although the present respondents initially owned part
of the subject property by virtue of succession, their inaction for several decades bars them from
recovering it from petitioners who have possessed it as owners since 1928. The purpose of
prescription is to protect the diligent and vigilant, not those who sleep on their rights.

The Case

Before us is a Petition for Review[1] under Rule 45 of the Rules of Court, challenging the
July 28, 2003 Decision[2] of the Court of Appeals (CA) in CA-GR CV No. 62535. The assailed
Decision disposed as follows:

WHEREFORE, premises considered, the instant appeal is hereby DISMISSED for lack of merit.
The assailed decision of the court a quo dated October 26, 1998 is AFFIRMED WITH THE
MODIFICATION that its declaration of the [petitioners] as lawful heirs of Dolores Derecho-
Rigonan, and indicating their lawful share equivalent to the share of one child of the deceased
Hilarion Derecho is DELETED.

Costs against the [petitioners].[3]

The trial courts Decision, modified by the CA, had disposed as follows:

WHEREFORE, premises considered, judgment is hereby rendered in favor of [respondents],


declaring the Affidavit of Adjudication executed by Leandro Rigonan on April 24, 1980 and the
Deed of Sale executed by Teodoro Rigonan in favor of Valerio Laude null and void; ordering the
cancellation of Tax Dec. No. 00667 in the name of Valerio Laude; ordering the [petitioners] to
pay [respondents], jointly and severally, moral damages in the sum of P10,000.00 and litigation
expenses in the sum of P5,000.00.

[Petitioners] are hereby ordered to give-up and deliver the possession and ownership of the
parcel of land in question to [respondents]. [Petitioners] being the heirs of the late Dolores
Derecho are entitled to the rightful share equivalent to the share of one child of deceased
Hilarion Derecho.[4]
The Facts

The instant controversy revolves around a parcel of land located at Tuburan Sur, Danao
City, originally owned by Hilarion Derecho. When Hilarion died long before World War II, his
eight children -- Leonardo, Apolinar, Andres, Honorata, Dolores, Gerardo, Agaton, and Oliva --
became pro indiviso co-owners of the subject property by intestate succession. Subsequently,
Tax Declaration No. 00267[5] was issued under the name Heirs of Hilarion.
On July 16, 1921, five of the co-owners -- Leonardo, Apolinar, Andres, Honorata, and
Dolores -- sold the inherited property to Francisco Lacambra, subject to a five-year redemption
clause.[6] Notably, the three other Derecho heirs -- Gerardo, Agaton, and Oliva -- were not
parties to the pacto de retro sale.
Sometime in 1928, two years after the period for redemption expired, Dolores -- together
with her husband, Leandro Rigonan -- purchased[7] the land from Lacambra and immediately
occupied it.[8]
More than five decades passed without any controversy. On April 24, 1980, Leandro
Rigonan executed the assailed Affidavit of Adjudication in favor of his son, Teodoro Rigonan
(the deceased husband of Petitioner Delfina vda. de Rigonan).[9] Under this instrument, Leandro
declared himself to be the sole heir of Hilarion,[10] while Teodoro obtained the cancellation of
Tax Declaration No. 00267,[11] and acquired Tax Declaration No. 00667 in his own name.[12]
During the same year, Teodoro mortgaged the subject property to the Rural Bank of
Compostela of Cebu. Dreading foreclosure, he settled his obligations with the bank [13] by
securing the aid of Spouses Valerio and Visminda Laude. On April 5, 1984, Teodoro executed
the assailed Deed of Absolute Sale of Unregistered Land in favor of Valerio Laude, [14] who then
obtained Tax Declaration No. 00726 under the latters name on May 10, 1984.[15]
On November 10, 1993, respondents -- as the alleged heirs of Hilarion and pro
indiviso owners of the subject realty -- brought an action before the Regional Trial Court (RTC)
of Danao City (Branch 25), first, to recover the property; and, second, to annul the Deed of Sale
in favor of Laude[16] and the Affidavit of Adjudication, whose validity and authenticity they
assailed on the ground of fraud. They likewise maintained that the subject property had not
been partitioned among the heirs; thus, it was still co-owned at the time it was conveyed to
Petitioner Laude.[17]
Petitioners did not deny the imputed fraud in the execution of the Affidavit of Adjudication.
They, however, averred that the document had no bearing on their claim of ownership, which
had long pertained to the Rigonan spouses following the 1928 conveyance from the absolute
owner, Lacambra.[18] They theorized that the co-ownership over the property ended when the
period for redemption lapsed without any action on the part of the co-owners.[19] Therefore, the
Rigonan spouses bought the property as legitimate vendees for value and in good faith, not in
the capacity of redeeming co-owners.[20]
Petitioners likewise argued that they and their predecessors-in-interest had continuously
owned and possessed the subject property for 72 years. Accordingly, acquisitive prescription
had allegedly set in, in their favor, when the case was filed in 1993.[21]
Lastly, petitioners maintained that they were entitled to the equitable defense of laches.
Respondents and their forebears were rebuked for not asserting their rights over the property
for the past 72 years. They supposedly did so only after finding that the land had been
developed, and that it had appreciated in value.[22]
Ruling of the Court of Appeals

On appeal, the CA held that the Affidavit of Adjudication and the Deed of Absolute Sale
were both void. The Affidavit was deemed fraudulent because of the undisputed factual finding
that some of the heirs of Hilarion were still alive at the time of its execution; hence, the
statement that Leandro was the sole heir was indubitably false.[23] The Deed of Sale in favor of
Laude was held void because the vendor, Teodoro, had no legal right to dispose of the entire
co-owned property. Moreover, the appellate court found that the evident purpose of the Contract
was to deprive the other lawful heirs of their claims over the realty. Under Article 1409 (pars. 1 &
2), of the Civil Code, the Contract was considered void ab initio.[24]
As the Contracts were void, the defense of prescription was inapplicable. Article 1410 of the
Civil Code states that actions for the declaration of the inexistence of a contract do not
prescribe.[25]
As for the defense that the co-ownership ended when the period to redeem expired, the CA
ruled that the redemption or repurchase by the Rigonan spouses did not end the state of co-
ownership. At most, the repurchase gave rise to an implied trust in favor of the other co-
owners.[26]
The CA added that prescription was inapplicable, because it did not run in favor of a co-
owner as long as the latter recognized the co-ownership. In the present case, petitioners failed
to show that the co-heirs, except Dolores, had repudiated their rights over the inherited
property.[27]
The appellate court further ruled that Valerio Laude was not a buyer in good faith for two
reasons; one, he had been forewarned by Respondent Ruben Derecho that the property was
still co-owned; and, two, Valerio had admitted seeing the cancelled Tax Declaration under the
name of the heirs of Hilarion. These matters should have alerted Valerio, who should have then
exercised prudence as a buyer.[28]
Finally, the appellate court held that the action for recovery prescribed within ten years from
the issuance of the Certificate of Title, which operated as a constructive notice. Considering,
however, that the subject property was unregistered, the CA ruled that the prescriptive period
should be reckoned from the issuance of the Tax Declaration on May 10, 1984. It concluded
that the action was filed well within the period allowed by law for its recovery.[29]
Hence, this Petition.[30]

Issues

Petitioners raise the following issues for our consideration:

1. Respondent Court of Appeals erred in holding that the land subject matter hereof is
property held in common by the Heirs of Hilarion Derecho and an [i]mplied [t]rust was
created by the act of repurchase.

2. Respondent Court of Appeals erred in holding that the action for the recovery of
possession and ownership is not time-barred by prescription and/or laches.
3. Respondent Court of Appeals erred in holding that respondents action for annulment of
the Deed of Sale and Affidavit of Adjudication is not time-barred by prescription and/or
laches.

4. Respondent Court of Appeals erred in holding that Petitioner Valerio Laude is not a
buyer in good faith and cannot be considered as legitimate and lawful owner of the subject
property.

5. Respondent Court of Appeals erred in resolving the case with an award of litigation
expenses and attorneys fees.

6. Respondent Court of Appeals acted with grave abuse of discretion when it ruled on the
issue of [h]eirship.[31]

Simply stated, the issues are as follows:


1. Whether at the time of the purchase in 1928, co-ownership still subsisted among the
heirs of Hilarion Derecho
2. Whether an implied trust was created
3. Whether the action in the RTC was barred by prescription and laches

The Courts Ruling

The Petition has merit.

First Issue:
Co-Ownership

Petitioners argue that the co-ownership ended when the heirs entered into a sale with the
right to repurchase and subsequently failed to redeem the property within the stipulated period.
Consequently, when the Rigonan spouses bought the subject land from Lacambra, it was a
conveyance to the spouses in their personal capacities, not as co-owners.[32]
On the other hand, respondents merely adopted[33] the CAs disquisitions discussed earlier.
Since the Spanish Civil Code was still in effect when Hilarion died long before the outbreak
of the Second World War[34] and when the sale was executed on July 16, 1921, it is evident that
the said law governed both the co-ownership and the pacto de retro sale.

Pacto de Retro and


Failure to Redeem

Under a pacto de retro sale, title to and ownership of property are immediately vested in the
vendee a retro, subject only to the resolutory condition that the vendor repurchases it within the
stipulated period. Pending the redemption, the vendor loses all ownership rights over the
property, save for the right to repurchase it upon compliance with the requirements provided in
Article 1518 of the Spanish Civil Code.[35]
In a number of cases, this Court has held that once the vendor fails to redeem the property
within the stipulated period, irrevocable title shall be vested in the vendee by operation of law.[36]
In the instant case, the parties to the contract stipulated a five-year redemption period,
which expired on July 16, 1926. The failure of the sellers to redeem the property within the
stipulated period indubitably vested absolute title and ownership in the vendee, Lacambra.
Consequently, barring any irregularities in the sale, the vendors definitively lost all title, rights
and claims over the thing sold. To all intents and purposes, therefore, the vendors a retro
ceased to be co-owners on July 16, 1926.
Clearly then, the parties to the sale -- Leonardo, Apolinar, Andres, and Honorata (but not
Dolores, as will be explained later), as well as all their successors-in-interest -- no longer had
any legal interest in the disputed property, none that they could have asserted in this action.

Purchase Beyond the


Redemption Period

As for Dolores, she reacquired legal interest in the property by virtue of the purchase in
1928, two years after the period to redeem had already expired.[37]
This purchase cannot be considered as a redemption in the concept of a pacto de
retro sale, which would imply that the period to redeem was extended long after it had already
expired. Such automatic extension is not possible because, as succinctly stated by Manresa, if
the extension is made after the expiration of the period, then it is void and of no effect because
there is nothing to extend.[38]
Adiarte v. Tumaneng[39] illustrates the legal effect of the expiration of the stipulated period
for redemption. In that case, Amanda Madamba sold two parcels of land to Spouses Cirilo
Agudong and Emiliana Tumaneng. However, she reserved for herself the right to repurchase
the lots within ten years. Five years after the period expired, Agudong executed a Contract
promising to resell the land to Madamba. When the former died without fulfilling his promise, the
latter filed a suit to compel the widow to execute a deed of sale in the plaintiffs favor. The widow
argued that Madamba could no longer redeem the property, because the period for redemption
had already expired.
In debunking the widows defense, this Court ruled that the Contract did not constitute a
promise to resell, because the right to repurchase had been lost after the expiration of the
stipulated period. The original Contract of Sale with a right of repurchase no longer existed at
the time Agudong made the promise to sell. Therefore, the parties entered into an entirely new
and independent agreement to sell, which was binding on the widow.
In Umale v. Fernandez,[40] the Court ruled that the vendors were entitled to redeem the
property despite the lapse of the period for redemption, inasmuch as the vendees had
renounced their right. On April 13, 1905, a parcel of land was sold a retro by Emigdio Umale
and his wife to Spouses Fernandez, without fixing any period for redemption. On June 12, 1909,
Fernandez executed a Contract allowing the Umale spouses to redeem the land despite the
lapse of the four-year period of redemption. This period was mandated by Article 1508[41] of the
Spanish Civil Code for cases in which no period had been stipulated. In 1911, Emigdio Umale
redeemed the land and took possession of it.
He then sued to compel the Fernandez couple to execute the instrument of redemption.
The defendants countered that the land belonged to them, because the vendors had failed to
redeem it within the term allowed by law. The Court ruled:

In the absence of an express stipulation with regard to the period of redemption, the purchaser,
in the exercise of the freedom to make contracts that is possessed by all, has the power to
extend the period allowed by law, provided that the new period stipulated does not exceed the
ten years fixed by article 1508 of the code. For nothing in this article prohibits an extension, by
agreement, of the four years, which is the period prescribed by law in cases where, in sales with
right of repurchase, no period for redemption has been fixed by the parties. [42] [Emphasis
supplied]

In his Concurring Opinion,[43] Justice Torres arrived at the same conclusion, but on a
different ground. He explained that the contracting parties had no right to extend the legal period
for redemption after it had already lapsed; and that, when the vendees alienated and returned
the property afterwards, they did so by virtue of a new Contract of Sale, independent of and
distinct from the previous one already terminated.
It is clear from Adiarte and Umale that after the expiration of the period for redemption, the
parties could either (1) enter into an entirely new contract involving the same property; or (2) if
they did not expressly stipulate the period, extend the time for redemption, provided the
extension did not exceed the maximum period of ten years allowed by Article 1508.[44]
In the present case, Lacambra and the heirs stipulated a five-year redemption period. When
it lapsed, the vendee acquired absolute title, while the five co-owners-sellers were stripped of
their co-ownership of the property.
Therefore, when Dolores repurchased the property in 1928, she did so in her personal
capacity, no longer as a co-owner-seller. Following the ruling in Adiarte, she is deemed to have
entered into an entirely new contract, independent of the 1921 pacto de retro sale.

Second Issue:
Implied Trust

Petitioners contend that the appellate court erred in holding that an implied trust had arisen
from the 1928 repurchase by the Rigonan spouses. They argue that the sale was a conveyance
of the absolute ownership of Lacambra over the land, which he had acquired by virtue of a
failure to redeem. Therefore, when he sold it, the spouses likewise acquired absolute
ownership.[45]
We clarify.

Satisfy Demands of
Justice and Equity

An implied trust arises, not from any presumed intention of the parties, but by operation of
law in order to satisfy the demands of justice and equity and to protect against unfair dealing or
downright fraud.[46] Under Article 1456 of the new Civil Code, if property is acquired through
mistake or fraud, the person obtaining it is, by force of law, considered a trustee of an implied
trust for the benefit of the person from whom the property comes. Although this provision is not
retroactive in character, and thus inapplicable to the 1928 purchase, it merely expresses a rule
already recognized by our courts prior to the effectivity of the Code.[47]
In the present case, the implied trust arose in 1921, when five of the eight co-owners
assumed ownership of the whole inherited property and sold it in its entirety to Lacambra. The
sale clearly defrauded the three other co-heirs who were not parties to the transaction --
Gerardo, Agaton, and Oliva -- and unlawfully deprived them of their undivided shares in the
inheritance. Thus, to the extent of their participation, the property is deemed to have been
acquired through fraud; and the person who acquired it, a trustee for the benefit of the person
from whom it was acquired.[48]
In the present case, Lacambra was the trustee who held the property partly for the benefit
of the three mentioned heirs (cestuis que trustent).
The CA, however, erred in finding that the implied trust had arisen in 1928, when the
Rigonan spouses repurchased the property from Lacambra.[49] By then, Petitioners Rigonan
were merely stepping into the shoes of Lacambra as trustee.

Third Issue:
Prescription or Laches

Petitioners argue that even if an implied trust existed, acquisitive prescription is still
applicable. They rely on the pronouncement in Medina v. Court of Appeals[50] that acquisitive
prescription applies to implied trusts, provided there is continuous adverse possession of
property in the concept of owner.[51]
Petitioners maintain that they obtained absolute ownership of the subject land through
acquisitive prescription. They point out that the heirs did not impugn the validity of the
documents of sale until after seventy-two years, in 1993 when the case was filed before the trial
court.[52]
Petitioners are correct.
It is settled in this jurisdiction that prescription,[53] as well as laches,[54] supervenes in the
enforcement of implied trusts.

Prescription of Action

Possession of the property by petitioners commenced way back in 1928,[55] when the
prescriptive periods applicable were those provided in Act 190 (Code of Civil Procedure). Their
argument finds basis in Article 1116 of the new Civil Code, which states that prescription
already running before the effectivity of this Code shall be governed by laws previously in force
x x x.
Under Section 40 of the Code of Civil Procedure, an action for recovery of real property, or
of an interest therein, can be brought only within ten years after the cause of action accrues.[56]
The cause of action of respondents accrued in 1928, when they lost possession of the
property to the forebears of petitioners. These predecessors-in-interest took possession from
1928[57] until 1980 when Laude, their successor-in-interest, continued possession up to the
present. During this entire time, respondents inexcusably failed to take action to recover the
property. In 1993, they finally rose from their seeming slumber when they filed the present suit.
Unfortunately, 65 years had already lapsed and, by that time, their right of action had clearly
been barred by extinctive prescription.

Acquisitive Prescription

Moreover, petitioners acquired title to the subject property by prescription. Section 41 of Act
190 (Code of Civil Procedure) provides:

Title to land by prescription. -- Ten years actual adverse possession by any person claiming to
be the owner for that time of any land or interest in land, uninterruptedly continued for ten years
by occupancy, descent, grants, or otherwise, in whatever way such occupancy may have
commenced or continued, shall vest in every actual occupant or possessor of such land a full
and complete title, saving to the person under disabilities the rights secured by the next section.
In order to constitute such title by prescription or adverse possession, the possession by the
claimant or by the person under or through whom he claims must be actual, open, public,
continuous, under a claim of title exclusive of any other right and adverse to all claimants x x x.

This provision, as authoritatively and consistently interpreted by this Court, allows adverse
possession in any character to ripen into ownership after the lapse of ten years. [58] Prescription
lies under the said section even in the absence of good faith and just title.[59]
In the instant case, the Rigonan spouses possessed the property in the concept of owners
after their purchase in 1928. They peacefully occupied it, were never ousted from it, and never
prevented from enjoying its fruits.
Furthermore, possession by the Rigonan spouses was adverse to the other heirs, as shown
by the following: one, the former obtained the cancellation of the Tax Declaration in the latters
name; two, the spouses executed the Affidavit of Adjudication, claiming that Leandro Rigonan
was the sole heir; three, petitioners did not share with respondents the enjoyment of the
property for a half-century; and four, Teodoro sold the property to Laude. Respondents were
aware of these facts and of their rightful share in the land. Therefore, they knew that petitioners
were holding the property adverse to their interests.
As petitioners have been in continuous possession and enjoyment of the disputed land
since 1928, a length of time that has never been questioned, there can be no doubt that they
obtained title to it by acquisitive prescription.
To stress the folly of respondents protracted inaction, may we add that the present action
would still be barred, even if the Court were to apply the thirty-year period fixed by the present
Civil Code for the acquisition of ownership by extraordinary prescription[60] or for the extinction of
the right of action over immovables.[61]

Action to Annul Contracts


Imprescriptible, but Recovery
of Realty Barred by Acquisitive
Prescription

The CA dismissed petitioners defense of prescription on the ground that the action for
annulment of contracts was imprescriptible, as mandated by Article 1410 of the Civil Code.[62]
There is no question that the said action does not prescribe, but the principal question in
this case is the recovery of the subject property, which is the ultimate goal of respondents. They
seek the nullification of the Contracts, merely as a means or prelude to the recovery of the
property. Unfortunately for them, acquisitive prescription has already set in to bar the recovery.
As stated in Bargayo v. Camumot,[63] the prescription of an action and the acquisitive
prescription of ownership cannot and should not be confounded. They are two different and
distinct things, although equally transcendent, being of identical result and effect.
In that case, the Complaint filed by the heirs was one for partition, which did not prescribe,
while the defendant raised the defense of acquisitive prescription. This Court took a moment to
explain that the law spoke only of the imprescriptibility of the action, not of ownership. It
explained thus: x x x [I]t is evident that to deny the prescription of the ownership of an
inheritance, because Article 1965 of the Civil Code declares the action for its partition
imprescriptible, is to confound the prescription of ownership and that of an action x x x. [64] But
the Court overruled the defense, because the defendant had failed to prove adverse
possession, an essential element of acquisitive prescription.
Similarly, the imprescriptibility of an action to annul a contract does not mean that the
present respondents are perpetually allowed to recover the property, the subject of the void
contract. They may file the action to annul, but their right to recover based on ownership is
contingent on the premise that they still own the property. Ownership may have been lost in the
interval during which they remained inactive. For this reason, the Court constantly reminds
parties to remain vigilant over their rights.
This matter is likewise illuminated by Heirs of Maningding v. CA.[65] In that case, Ramon
owned two parcels of land in Pangasinan. When he died intestate, his four children -- Roque,
Segunda, Juan, and Maria -- inherited the contested properties. While Juan and Maria
renounced their rights to the inheritance, Roque claimed the land as his own by virtue of a
donation propter nuptias, previously executed in his favor by their father. Having been excluded
from the enjoyment of the property, the heirs of Segunda filed an action for partition against
Roque, as well as for the annulment of the conveyance documents.
The Court ruled that the parcels of land had devolved to the children of Ramon by right of
succession. Roque did not acquire exclusive ownership of those properties by virtue of the
Deed of Donation, which was null and void. Nevertheless, the Court held that his thirty-six years
of exclusive possession and enjoyment of the property sufficed to confer ownership through
acquisitive prescription. The heirs of Segunda were thus barred from recovering their shares in
the inheritance.
It will be noted that Maningding sustained the defense of acquisitive prescription despite the
imprescriptibility of the actions for annulment of contracts and partition. Simply put, the
imprescriptibility of an action is distinct from the prescription of ownership and rights.
In the present case, we hold that respondents can no longer recover the property despite
the nullity of the assailed contracts, because they have lost their ownership by reason of
prescription.
Laches

Assuming arguendo that the action does not prescribe, laches would still bar respondents
from belatedly asserting their claim. The defense of laches, which is a question of inequity in
permitting a claim to be enforced, applies independently of prescription, which is a question of
time.[66] Prescription is statutory; laches is equitable.[67]
In Miguel v. Catalino,[68] Bacaquio sold a parcel of land to Catalino in 1928. The latter
possessed it and enjoyed its fruits from then until 1962, when the heirs of Bacaquio filed a
complaint for recovery of possession of the property. The heirs asserted that the sale was void
for lacking the requisite executive approval. The Court held that, despite the nullity of the sale
and the fact that no prescription had run against the title of the heirs, the action was already
barred by laches due to their passivity and inaction for more than thirty-four years.
Again in Mejia de Lucas v. Gamponia,[69] the Court held that while the legal defense of
prescription did not lie, the equitable defense of laches did.
In that case, Domingo sold a parcel of registered land to Zacarias, who immediately took
possession of it and enjoyed its fruits. When the heirs of Domingo filed an action for the
annulment of the sale, Gamponia -- Zacarias successor-in-interest -- proffered the defense of
prescription. The lower court overruled the defense on the ground that registered lands could
not be acquired by prescription.
The lower court was reversed by this Court. Although Gamponia could not be deemed to
have acquired title by virtue of the fact that he and his predecessors had long and continued
possession of the property for thirty-seven years, the owners right to recover it as well as the
title to it was held to have been converted into a stale demand by their inaction and negligence.
Laches is defined as the failure to assert a right for an unreasonable and unexplained
length of time, warranting a presumption that the party entitled to assert it has either abandoned
or declined to assert it. This equitable defense is based upon grounds of public policy, which
requires the discouragement of stale claims for the peace of society. [70]
As previously mentioned, an action to enforce an implied trust may be circumscribed by
laches. Under this circumstance, repudiation is not even required,[71] unless the facts that give
rise to the trust are concealed. This principle holds because of the nature of an implied trust,
which involves a certain antagonism between the cestui que trust and the trustee.[72] There is
neither promise nor fiduciary relation; the trustee does not recognize any trust and has no
intention of holding the property for the beneficiary; therefore, the latter is not justified in
delaying action to recover the property. Having incurred unreasonable delay, the beneficiary is
estopped by laches.[73]
Coming to the present case, the record does not reveal, and respondents do not even
assert, that there was a concealment of the 1921 sale of the property to Lacambra. Although
three of the co-heirs were not parties to that transaction, there is no showing whatsoever that
they interjected any objection to the conveyance. There is no allegation, either, that respondents
were unaware of the sale in favor of Dolores or of her familys possession of the property since
1928. On the contrary, Respondent Ruben Derecho warned Laude not to buy the land because
it had not been partitioned.[74] This fact shows that respondents were aware that Teodoro
intended to sell the land, a move that was clearly an act of dominion over the entire property.
Their cognizance of these facts eliminates the need for a repudiation on the part of petitioners.
It was held in Go Chi Gun v. Co Cho[75] that four elements had to be shown in order to use
laches as a defense: (1) conduct on the part of the defendant, or of one under whom a claim is
made, giving rise to a situation for which a complaint is filed and a remedy sought; (2) delay in
asserting the rights of the complainant, who has knowledge or notice of the defendants conduct
and has been afforded an opportunity to institute a suit; (3) lack of knowledge or notice on the
part of the defendant that the complainant will assert the right on which the latter has based the
suit; and (4) injury or prejudice to the defendant in the event that the complainant is granted a
relief or the suit is not deemed barred.
The four requisites are present in the instant case. First, the five co-owners act of selling
the entire property deprived respondents predecessors of the enjoyment of their rightful shares
in the inheritance. This deprivation was the basis of the Complaint filed by respondents.
Second, respondents waited more than six decades to file a suit without offering any
excuse for the long delay in the assertion of their rights. They do not at all claim that they were
unaware of their co-heirs actions. They could have instituted an action to annul in 1921 or to
recover the property in 1928, since they were legally presumed to know of the invalidity of the
sale as to their shares; they did not have to wait for sixty-five years to institute this suit.
Third, after being allowed more than six decades of peaceful possession of the property,
petitioners were certainly not expecting respondents to reclaim it. Although Ruben Derecho
warned Laude not to buy the land because it was still co-owned, the former still took no
immediate action to prevent Teodoro from selling the entire property or to recover it.
Respondents even allowed nine more years to pass before rising from their stupor to institute
the Complaint.
Fourth, there is no doubt that petitioners will suffer if respondents are allowed to recover the
property. The former have already developed, invested in, and religiously paid the taxes for it for
at least a half-century. On the other hand, respondents nonchalantly allowed petitioners to
continue with their possession and enjoyment of the property, and then pounced upon them
when the latter least expected it.
Although we condemn the fraudulent acts of Leandro and the five co-owners in their
scheme to deprive their relatives of the latters rightful shares in the inheritance, the fact remains
that respondents and their forebears wasted their opportunity through a lifetime of indifference
and apathy. They cannot now be permitted to recover property that others have possessed,
developed, and invested in for sixty-five years. It would be sheer injustice to allow the latter to
reap benefits after generations of predecessors passively slept on their rights. The Court aptly
stated in Miguel v. Catalino:

x x x. Courts cannot look with favor at parties who, by their silence, delay, and inaction,
knowingly induce another to spend time, effort, and expense in cultivating the land, paying taxes
and making improvements thereon x x x only to spring from ambush and claim title when the
possessors efforts and the rise of land values offer an opportunity to make easy profit at his
expense.[76]

To grant respondents relief when they have not even offered any justifiable excuse for their
inaction would be unjust. It is certainly beyond our comprehension how they could have
remained silent for more than 50 years. They have only themselves to blame if the Court at this
late hour can no longer afford them relief against the inequities they allegedly suffered.
Considering the undisputed facts, not only had laches set in when respondents instituted
their action for reconveyance in 1993, but their right to enforce the constructive trust had already
prescribed as well.
WHEREFORE, the Petition is GRANTED. The assailed July 28, 2003 Decision of the Court
of Appeals is hereby REVERSED and SET ASIDE. The Complaint before the Regional Trial
Court of Danao City is hereby DISMISSED. No costs.
SO ORDERED.
Sandoval-Gutierrez, Corona, Carpio-Morales, and Garcia, JJ., concur.

[1]
Rollo, pp. 10-29.
[2]
Id., pp. 31-40; Special Second Division. Penned by Justice Amelita G. Tolentino, with the
concurrence of Justices Buenaventura J. Guerrero (Division chairman) and Mariano C.
del Castillo (member).
[3]
CA Decision, p. 11; rollo, p. 40.
[4]
Id., pp. 4 & 34.
[5]
Id., p. 9.
[6]
Id., p. 2; rollo, p. 32.
[7]
Ibid.
[8]
Id., pp. 7 & 37.
[9]
Id., pp. 3 & 33.
[10]
Id., pp. 6 & 36.
[11]
Id., p. 9.
[12]
Id., pp. 3 & 33.
[13]
Ibid.
[14]
Ibid.
[15]
Id., p. 9.
[16]
Id., pp. 1 & 31.
[17]
Id., pp. 3 & 33.
[18]
Petitioners Memorandum, p. 15; rollo, p. 79.
[19]
Id., pp. 9-10 & 73-74.
[20]
Id., pp. 13 & 77.
[21]
Id., pp. 17 & 81.
[22]
Id., pp. 18 & 82.
[23]
CA Decision, pp. 6-7; rollo, pp. 36-37.
[24]
Id., pp. 6 & 36.
[25]
Ibid.
[26]
Id., pp. 7 & 37.
[27]
Id., pp. 8 & 38.
[28]
Id., p. 9.
[29]
Id., pp. 9-10.
[30]
The case was deemed submitted for decision on May 17, 2004, upon this Courts receipt of
both respondents Memorandum, which was signed by Atty. Januario C. Flores; and
petitioners Memorandum, signed by Atty. Ana Marie Angelica P. Batiquin.
[31]
Petitioners Memorandum, pp. 6-7; rollo, pp. 70-71.
[32]
Id., pp. 9-13 & 73-77.
[33]
Respondents Memorandum, pp. 5-11; rollo, pp. 56-62.
[34]
Historically, the Second World War reached Philippine shores on December 8, 1941. Araneta
v. Dinglasan, 84 Phil. 368, 403, August 26, 1949; Co Cham v. Valdez, 75 Phil. 113, 212,
September 17, 1945.
[35]
Tolentino, Civil Code of the Philippines (1959), Vol. V, p. 135.
[36]
Patricio v. Aragon, 4 Phil. 615, July 28, 1905; Krapfenbauer v. Orbeta, 52 Phil. 201, October
13, 1928; Rosario v. Rosario, 110 Phil. 394, December 29, 1960; Dalandan v. Julio, 119
Phil. 678, February 29, 1964; Bayquen v. Balaoro, 143 SCRA 412, August 13, 1986; De
Guzman v. CA, 156 SCRA 701, December 21, 1987; Flores v. So, 162 SCRA 117, June
16, 1988; Cruz v. Leis, 327 SCRA 570, March 9, 2000.
[37]
CA Decision, p. 2; rollo, p. 32.
[38]
Adiarte v. Tumaneng, 88 Phil. 333, 345, March 15, 1951, per Padilla, J.
[39]
Ibid.
[40]
28 Phil. 89, September 29, 1914.
[41]
Article 1508. The right referred to in the preceding article, in the absence of an express
agreement, shall last four years counted from the date of the contract.
Should there be an agreement, the period shall not exceed ten years.
[42]
Umale v. Fernandez, supra, p. 93, per curiam.
[43]
Id., pp. 94-97.
[44]
Now Article 1606 of the new Civil Code.
[45]
Petitioners Memorandum, pp. 12-13; rollo, pp. 76-77.
[46]
Bueno v. Reyes, 137 Phil. 734, 738, April 28, 1969.
[47]
Diaz v. Gorricho, 103 Phil. 261, 264, March 29, 1958 (citing Gayondato v. Treasurer of the
Phil. Islands, 49 Phil. 244, August 25, 1926).
[48]
See Noel v. Court of Appeals, 240 SCRA 78, January 11, 1995; Gayondato v. Treasurer of
the Philippine Islands, 49 Phil. 244, August 25, 1926.
[49]
CA Decision, p. 7; rollo, p. 37.
[50]
109 SCRA 437, 444-445, November 27, 1981.
[51]
Petitioners Memorandum, pp. 16-17; rollo, pp. 80-81.
[52]
Id., pp. 13-17 & 77-81.
[53]
Bueno v. Reyes, supra at note 46; J. M. Tuason v. Magdangal, 4 SCRA 84, 88, January 30,
1962; Ramos v. Ramos, 61 SCRA 284, 300, December 3, 1974; Medina v. CA, supra at
note 50.
[54]
Fabian v. Fabian, 22 SCRA 231, 236, January 29, 1968 (citing Diaz v. Gorricho, supra at
note 47, pp. 264-265).
[55]
There is no showing of actual possession by Lacambra from the time of the pacto de
retro sale in 1921 up to the time he sold the property to the Rigonans. Hence,
possession for the purpose of prescription is counted only from 1928 when the Rigonans
purchased and commenced possession of the property.
[56]
40 of Act 190 reads: An action for the recovery of title to, or possession of, real property, or
an interest therein, can only be brought within ten years after the cause of action
accrues.
[57]
CA Decision, p. 7; rollo, p. 37.
[58]
Altman v. Commanding Officer, 11 Phil. 516, October 27, 1908; Locsin Rama v. Montelibano
Ramos, 36 Phil. 136, January 23, 1917; Santos v. Heirs of Crisostomo, 41 Phil. 342,
January 4, 1921; Arboso v. Andrade, 87 Phil. 782, December 29, 1950; Ongsiaco v.
Dallo, 136 Phil. 596, February 28, 1969; Alvero v. Reas, 35 SCRA 210, September 30,
1970; Ramos v. CA, 112 SCRA 542, March 15, 1982.
[59]
Alvero v. Reas, supra, p. 214, per Reyes, J.
[60]
Article 1137. Ownership and other real rights over immovables also prescribe through
uninterrupted adverse possession thereof for thirty years, without need of title or of good
faith.
[61]
Article 1141. Real actions over immovables prescribe after thirty years. This provision is
without prejudice to what is established for the acquisition of ownership and other real
rights by prescription.
[62]
CA Decision, p. 6; rollo, p. 36.
[63]
40 Phil. 857, 866, March 12, 1920, per Torres, J.
[64]
Id., p. 867.
[65]
276 SCRA 601, July 31, 1997.
[66]
Maneclang v. Baun, 208 SCRA 179, April 22, 1992 (citing Nielson & Co., Inc. v. Lepanto
Consolidated Mining Co., 18 SCRA 1040, December 17, 1966).
[67]
Maneclang v. Baun, supra, p. 193.
[68]
26 SCRA 234, November 29, 1968.
[69]
100 Phil. 277, October 31, 1956.
[70]
Tijam v. Sibonghanoy, 23 SCRA 29, April 15, 1968.
[71]
Gonzales v. IAC, 204 SCRA 106, 115, November 21, 1991; Fabian v. Fabian, supra at note
54, pp. 236-237 (citing Diaz v. Gorricho, supra at note 47, pp. 264-265).
[72]
Bueno v. Reyes, supra at note 46, p. 738.
[73]
Diaz v. Gorricho, supra at note 47, p. 266.
[74]
CA Decision, p. 9.
[75]
96 Phil. 622, 637, February 28, 1955.
[76]
Miguel v. Catalino, supra at note 68, p. 239, per Reyes, J.
3) G.R. No. 121157. July 31, 1997

HEIRS OF SEGUNDA MANINGDING, represented by DELFIN, GIL, EMMA, MANUEL,


RACQUEL, ESTER, REMEDIOS and JESSIE, all surnamed PARAYNO, MAXIMA
PARAYNO, LEONARDO PARAYNO and FELICISIMA
PARAYNO, petitioners, vs. COURT OF APPEALS and ROQUE BAUZON
(deceased), represented by his heirs and co-defendants Luis and Eriberta Bauzon;
LUIS BAUZON, ERIBERTA BAUZON (deceased), substituted by her husband
PLACIDO ZULUETA, and JOSE PARAYNO, respondents.

DECISION
BELLOSILLO, J.:

This is an action for annulment of documents, accounting and partition of two (2) parcels of
land, a riceland and a sugarland, situated in Calasiao, Pangasinan. Petitioners claim that they,
together with private respondents Luis and Eriberta Bauzon, own the disputed lots in common
and pro-indiviso. Luis and Eriberta, the latter represented by her husband Placido Zulueta, aver
that their father Roque Bauzon was the owner of the subject lots by virtue of a deed of
donation propter nuptias. Roque, together with Juan Maningding, Maria Maningding and
Segunda Maningding were the surviving children of Ramon Bauzon y Untalan who died
intestate in 1948. According to petitioners, Roque Bauzon repudiated the co-ownership over
the sugarland in 1965 and adjudicated it to himself,[1] and that in 1970 Juan and Maria
Maningding renounced and quitclaimed their shares over the riceland in favor of Roque Bauzon
by virtue of an Affidavit of Quitclaim and Renunciation.[2] Subsequently, Roque Bauzon
transferred the riceland to his son Luis Bauzon and the sugarland to his daughter Eriberta
Bauzon, both transactions being evidenced by deeds of sale.
On 31 July 1979 Segunda Maningding died. Her heirs allegedly discovered the transfers
made by Roque Bauzon in favor of his children only in 1986. Consequently, the heirs sought the
partition of the properties as well as the accounting of the produce but were unsuccessful.
On the other hand private respondents aver that the Affidavit of Quitclaim and
Renunciation over the riceland was executed not only by Juan Maningding and Maria
Maningding but also by Segunda Maningding. With regard to the sugarland, Roque Bauzon
denied having executed the Affidavit of Self-Adjudication presented by petitioners. He claimed
that he acquired ownership over both the sugarland and the riceland by donation propter
nuptias from his parents Ramon Bauzon and Sotera Zulueta on 21 April 1926 in consideration
of his marriage to Petra Loresco. Since the death of Ramon Bauzon in 1948, Roque had been
in open, continuous, notorious, adverse and actual possession of the subject properties.
The trial court found that the parcels of land formed part of the estate of Ramon Bauzon
and his wife Sotera Zulueta which, upon their death, devolved by right of succession to their
children Segunda Maningding, Maria Maningding, Juan Maningding and Roque Bauzon in
equal pro-indiviso shares. The court a quo however awarded both parcels to Segunda
Maningding and Roque Bauzon as co-owners in equal shares after finding that Juan
Maningding and Maria Maningding had already executed an Affidavit of Quitclaim and
Renunciation. It rejected the deed of donation for failure to prove its due execution and
authenticity and ruled that the same was negated by the Affidavit of Quitclaim and
Renunciation of Juan Maningding and Maria Maningding in favor of Roque Bauzon and nullified
the deed of sale by Roque Bauzon in favor of Luis Bauzon as regards the riceland and to
Eriberta Bauzon with respect to the sugarland. It concluded that Roque Bauzon could not have
validly conveyed both parcels as one-half (1/2) of each parcel rightfully belonged to Segunda
Maningding and her heirs.
The Court of Appeals however ruled that the properties validly pertained to Roque Bauzon
by virtue of the donation propter nuptias. Consequently, the transfers made by Roque Bauzon
must be given effect. However, upon motion for reconsideration, the same deed of donation was
declared null and void by the appellate court for failure to comply with Art. 633 of the old Civil
Code, the law then applicable, which required for the validity of the deed of donation to be in a
public instrument. Nevertheless, the same court maintained that the properties belonged to
Roque Bauzon by virtue of acquisitive prescription.
We agree with the Court of Appeals. Roque Bauzon acquired ownership over the subject
properties by acquisitive prescription. Prescription, in general, is a mode of acquiring (or losing)
ownership and other real rights through the lapse of time in the manner and under conditions
laid down by law, namely, that the possession should be in the concept of an owner, public,
peaceful, uninterrupted and adverse.[3] Acquisitive prescription is either ordinary or
extraordinary.[4]
Ordinary acquisitive prescription requires possession in good faith and with just title for ten
(10) years. In extraordinary prescription ownership and other real rights over immovable
property are acquired through uninterrupted adverse possession thereof for thirty (30) years,
without need of title or of good faith.[5]
The disputed lots are unregistered lands, both parcels being covered only by tax
declarations formerly in the name of Ramon Bauzon and now transferred to Luis and Eriberta
Bauzon. While tax declarations and receipts are not conclusive evidence of ownership,
yet, when coupled with proof of actual possession, as in the instant case, tax declarations and
receipts are strong evidence of ownership.[6]
Even assuming that the donation proper nuptias is void for failure to comply with formal
requisites,[7] it could still constitute a legal basis for adverse possession. With clear and
convincing evidence of possession, a private document of donation may serve as basis for a
claim of ownership.[8] In Pensader v. Pensader[9] we ruled that while the verbal donation under
which the defendant and his predecessors-in-interest have been in possession of the lands in
question is not effective as a transfer of title, still it is a circumstance which may explain the
adverse and exclusive character of the possession. In Espique v. Espique[10] we held -

There is no question that the donation in question is invalid because it involves an immovable
property and the donation was not made in a public document as required by Article 633 of the
old Civil Code, in connection with Article 1328 of the same Code (concerning gifts propter
nuptias), but it does not follow that said donation may not serve as basis of acquisitive
prescription when on the strength thereof the done has taken possession of the property
adversely and in the concept of owner, or, as this Court well said: While the verbal donation,
under which the defendants and his predecessors-in-interest have been in possession of the
lands in question, is not effective as a transfer of title, yet it is a circumstance which may explain
the adverse and exclusive character of the possession (Pensader v. Pensader, 47 Phil. 673,
680). This is also an action for partition. It was shown that the donation of the property was
made not even in a private document but only verbally. It was also shown that the defendants,
through their predecessors-in-interest, were in adverse and continuous possession of the lands
for a period of over 30 years. Yet, the court decided the case in favor of defendants on the
ground of acquisitive prescription. There is a close parallelism between the facts of this case
and the present.

xxxx

We do not need to stretch our mind to see that under such allegations plaintiffs intended to
convey the idea that defendant has possessed the lands openly, adversely and without
interruption from 1916 to 1949 for he is the one who has possessed and reaped the whole
benefit thereof. As to the character of the possession held by defendant during that period one
cannot also deny that it is in the concept of owner considering that the lands were donated to
him by his predecessors-in-interest on the occasion of his marriage even if the same was not
embodied in a public instrument. The essential elements constituting acquisitive prescription are
therefore present which negative the right of plaintiffs to ask for partition of said properties. On
this point we find pertinent the following observation of the trial court: Any person who claims
right of ownership over immovable properties and does not invoke that right but instead
tolerated others in possession for thirty years is guilty of laches and negligence and he must
suffer the consequence of his acts.

In the instant case, Roque Bauzon possessed the subject parcels of land in the concept of
owner by virtue of the donation propter nuptias. The possession was public as it was Roque
Bauzon who personally tilled and cultivated the lots. The acts of reaping the benefits of
ownership were manifest and visible to all. These acts were made more pronounced and public
considering that the parcels of land are located in a municipality wherein ownership and
possession are particularly and normally known to the community.Roque peacefully possessed
the properties as he was never ousted therefrom nor prevented from enjoying their fruits. His
possession was uninterrupted and in good faith because of his well-founded belief that the
donation propter nuptias was properly executed and the grantors were legally allowed to convey
their respective shares in his favor. He likewise appropriated to himself the whole produce of the
parcels of land to the exclusion of all others.
The donation propter nuptias was effected as early as 21 April 1926. It was only in 1986
when the heirs of Segunda Maningding demanded partition of the properties and conveyance of
the produce. Sixty (60) years have already elapsed. Even granting that Roque Bauzon
possessed the properties only upon the death of his father in 1948, more than thirty (30) years
have already passed. In either case, acquisitive prescription has already set in in favor of Roque
Bauzon.
Again, even if we assume the absence of good faith and just title, the ownership of the two
(2) parcels would still appertain to Roque Bauzon. As testified to by Delfin Parayno, one of
petitioners, Roque Bauzon and his heirs had been in continuous, adverse and public
possession of the property since 1948 up to 1986, or a period of thirty-six (36) years, which is
more than the required thirty-year extraordinary prescription.
Prescription, as a rule, does not run in favor of a co-heir or co-owner as long as he
expressly or impliedly recognizes the co-ownership.[11] Co-owners cannot acquire by
prescription the share of the other co-owners, absent a clear repudiation of the co-ownership.In
order that title may prescribe in favor of one of the co-owners, it must be clearly shown that he
has repudiated the claims of the others, and that they were apprised of his claim of adverse and
exclusive ownership, before the prescriptive period would begin to run.Mere refusal to accede to
a partition, without specifying the grounds for such refusal, cannot be considered as notice to
the other co-owners of the occupants claim of title in himself in repudiation of the co-
ownership. The evidence relative to the possession, as a fact upon which the alleged
prescription is based, must be clear, complete and conclusive in order to establish said
prescription without any shadow of doubt; and when upon trial it is not shown that the
possession of the claimant has been adverse and exclusive and opposed to the rights of the
others, the case is not one of ownership, and partition will lie.[12]
Therefore while prescription among co-owners cannot take place when the acts of
ownership exercised are vague and uncertain, such prescription arises and produces all its
effects when the acts of ownership do not evince any doubt as to the ouster of the rights of the
other co-owners.[13] As disclosed by the records, Roque Bauzon and his heirs possessed the
property from 1948 to 1986 to the exclusion of petitioners who were never given their shares of
the fruits of the properties, for which reason they demanded an accounting of the produce and
the conveyance to them of their shares. Unfortunately they slept on their rights and allowed
almost thirty-six (36) years to lapse before attempting to assert their right. Perforce, they must
suffer the consequence of their inaction.
WHEREFORE, the petition is DENIED. The Resolution of the Court of Appeals of 7 July
1995 which modified its Decision of 29 November 1994 and holding that the deceased Roque
Bauzon acquired the disputed two (2) parcels of land by acquisitive prescription is
AFFIRMED. Costs against petitioners.
SO ORDERED.
Padilla, (Chairman), Vitug, Kapunan, and Hermosisima, Jr., JJ., concur.

[1]
Annex B, Records.
[2]
Annex A, id
[3]
Paras, Edgardo L., Civil Code of the Philippines, Vol. IV, 1994 ed., p. 1.
[4]
Art. 1117, New Civil Code.
[5]
Art. 1137, id.
[6]
Bautista v. Court of Appeals, No. L-43105, 31 August 1984, 131 SCRA 533; Director of
Lands v. Court of Appeals, G.R. No. 50340, 26 December 1984, 133 SCRA 701.
[7]
Art. 633 of the old Civil Code requires for the validity of a deed of donation
propter nuptias that it be in a public instrument.
[8]
Cabautan v. Serrano, No. L-24112, 26 May 1960, 57 O.G. 292 (1961).
[9]
47 Phil. 959 (1925).
[10]
No. L-8029, 28 June 1956, 53 O.G. 4080-4082 (July, 1957).
[11]
David v. Bandin, No. L-48322, 8 April 1987, 149 SCRA 140.
[12]
Mariano v. De Vega, G.R. No. 59974, 9 March 1987, 148 SCRA 342, 346-347, citing
Tolentino, Arturo M., Commentaries and Jurisprudence on the Civil Code of the
Philippines, Vol. 2, 1983 ed., pp. 224-225.
[13]
Tolentino, Arturo M., Commentaries and Jurisprudence on the Civil Code of the
Philippines, Vol. 2, 1983 ed., p. 181.
Legal Research

In general, what are the requirements of procedural due process?

The requirements of procedural due process are as follows:

1. There must be an IMPARTIAL AND COMPETENT COURT with judicial power to


hear and determine the matter before it
2. Jurisdiction MUST HAVE BEEN LAWFULLY ACQUIRED over the
person of the defendant or over the property subject of the proceeding
3. The defendant must be given an OPPORTUNITY TO BE HEARD
4. Judgment must be RENDERED UPON LAWFUL HEARING
Legal Research: Corona Case

Republic of the Philippines


SUPREME COURT
Baguio City

SECOND DIVISION

G.R. No. 131457 April 24, 1998

HON. CARLOS O. FORTICH, PROVINCIAL GOVERNOR OF BUKIDNON, HON. REY B.


BAULA, MUNICIPAL MAYOR OF SUMILAO, BUKIDNON, NQSR MANAGEMENT AND
DEVELOPMENT CORPORATION, petitioners,
vs.
HON. RENATO C. CORONA, DEPUTY EXECUTIVE SECRETARY, HON. ERNESTO D.
GARILAO, SECRETARY OF THE DEPARTMENT OF AGRARIAN REFORM, respondents.

MARTINEZ, J.:

The dramatic and well-publicized hunger strike staged by some alleged farmer-beneficiaries in
front of the Department of Agrarian Reform compound in Quezon City on October 9, 1997
commanded nationwide attention that even church leaders and some presidential candidates
tried to intervene for the strikers' "cause."

The strikers protested the March 29, 1996 Decision 1 of the Office of the President (OP), issued
through then Executive Secretary Ruben D. Torres in OP Case No. 96-C-6424, which approved
the conversion of a one hundred forty-four (144)-hectare land from agricultural to agro-
industrial/institutional area. This led the Office of the President, through then Deputy Executive
Secretary Renato C. Corona, to issue the so-called "Win-Win" Resolution 2 on November 7,
1997, substantially modifying its earlier Decision after it had already become final and
executory. The said Resolution modified the approval of the land conversion to agro-industrial
area only to the extent of forty-four (44) hectares, and ordered the remaining one hundred (100)
hectares to be distributed to qualified farmer-beneficiaries.

But, did the "Win-Win" Resolution culminate in victory for all the contending parties?

The above-named petitioners cried foul. They have come to this Court urging us to annul and
set aside the "Win-Win" Resolution and to enjoin respondent Secretary Ernesto D. Garilao of
the Department of Agrarian Reform from implementing the said Resolution.
Thus, the crucial issue to be resolved in this case is: What is the legal effect of the "Win-Win"
Resolution issued by the Office of the President on its earlier Decision involving the same
subject matter, which had already become final and executory?

The antecedent facts of this controversy, as culled from the pleadings, may be stated as follows:

1. This case involves a 144-hectare land located at San Vicente, Sumilao, Bukidnon, owned by
the Norberto Quisumbing, Sr. Management and Development Corporation (NQSRMDC), one of
the petitioners. The property is covered by a Transfer Certificate of Title No. 143713 of the
Registry of Deeds of the Province of Bukidnon.

2. In 1984, the land was leased as a pineapple plantation to the Philippine Packing Corporation,
now Del Monte Philippines, Inc. (DMPI), a multinational corporation, for a period of ten (10)
years under the Crop Producer and Grower's Agreement duly annotated in the certificate of title.
The lease expired in April, 1994.

3. In October, 1991, during the existence of the lease, the Department of Agrarian Reform
(DAR) placed the entire 144-hectare property under compulsory acquisition and assessed the
land value at P2.38 million.4

4. NQSRMDC resisted the DAR's action. In February, 1992, it sought and was granted by the
DAR Adjudication Board (DARAB), through its Provincial Agrarian Reform Adjudicator (PARAD)
in DARAB Case No. X-576, a writ of prohibition with preliminary injunction which ordered the
DAR Region X Director, the Provincial Agrarian Reform Officer (PARO) of Bukidnon, the
Municipal Agrarian Reform Office (MARO) of Sumilao, Bukidnon, the Land Bank of the
Philippines (Land Bank), and their authorized representatives "to desist from pursuing any
activity or activities" concerning the subject land "until further orders."5

5. Despite the DARAB order of March 31, 1992, the DAR Regional Director issued a
memorandum, dated May 21, 1992, directing the Land Bank to open a trust account for P2.38
million in the name of NQSRMDC and to conduct summary proceedings to determine the just
compensation of the subject property. NQSRMDC objected to these moves and filed on June 9,
1992 an Omnibus Motion to enforce the DARAB order of March 31, 1992 and to nullify the
summary proceedings undertaken by the DAR Regional Director and Land Bank on the
valuation of the subject property.

6. The DARAB, on October 22, 1992, acted favorably on the Omnibus Motion by (a) ordering
the DAR Regional Director and Land Bank "to seriously comply with the terms of the order
dated March 31, 1992;" (b) nullifying the DAR Regional Director's memorandum, dated May 21,
1992, and the summary proceedings conducted pursuant thereto; and (c) directing the Land
Bank "to return the claim folder of Petitioner NQSRMDC's subject Property to the DAR until
further orders."6

7. The Land Bank complied with the DARAB order and cancelled the trust account it opened in
the name of petitioner NQSRMDC. 7

8. In the meantime, the Provincial Development Council (PDC) of Bukidnon, headed by


Governor Carlos O. Fortich, passed Resolution No. 6,8 dated January 7, 1993, designating
certain areas along Bukidnon-Sayre Highway as part of the Bukidnon Agro-Industrial Zones
where the subject property is situated.
9. What happened thereafter is well-narrated in the OP (TORRES) Decision of March 29, 1996,
pertinent portions of which we quote:

Pursuant to Section 20 of R.A. No. 7160, otherwise known as the Local


Government Code, the Sangguniang Bayan of Sumilao, Bukidnon, on March 4,
1993, enacted Ordinance No. 24 converting or re-classifying 144 hectares of land
in Bgy. San Vicente, said Municipality, from agricultural to industrial/institutional
with a view of providing an opportunity to attract investors who can inject new
economic vitality, provide more jobs and raise the income of its people.

Parenthetically, under said section, 4th to 5th class municipalities may authorize
the classification of five percent (5%) of their agricultural land area and provide
for the manner of their utilization or disposition.

On 12 October 1993, the Bukidnon Provincial Land Use Committee approved the
said Ordinance. Accordingly, on 11 December 1993, the instant application for
conversion was filed by Mr. Gaudencio Beduya in behalf of NQSRMDC/BAIDA
(Bukidnon Agro-Industrial Development Association).

Expressing support for the proposed project, the Bukidnon Provincial Board, on
the basis of a Joint Committee Report submitted by its Committee on Laws,
Committee on Agrarian Reform and Socio-Economic Committee approved, on 1
February 1994, the said Ordinance now docketed as Resolution No. 94-95. The
said industrial area, as conceived by NQSRMDC (project proponent) is supposed
to have the following components:

1. Development Academy of Mindanao which constitutes following: Institute for


Continuing Higher Education; Institute for Livelihood Science (Vocational and
Technical School); Institute for Agribusiness Research; Museum, Library,
Cultural Center, and Mindanao Sports Development Complex which covers an
area of 24 hectares;

2. Bukidnon Agro-Industrial Park which consists of corn processing for corn oil,
corn starch, various corn products; rice processing for wine, rice-based snacks,
exportable rice; cassava processing for starch, alcohol and food delicacies;
processing plants, fruits and fruit products such as juices; processing plants for
vegetables processed and prepared for market; cold storage and ice plant;
cannery system; commercial stores; public market; and abattoir needing about
67 hectares;

3. Forest development which includes open spaces and parks for recreation,
horse-back riding, memorial and mini-zoo estimated to cover 33 hectares; and

4. Support facilities which comprise the construction of a 360-room hotel,


restaurants, dormitories and a housing project covering an area of 20 hectares.

The said NQSRMDC Proposal was, per Certification dated January 4, 1995,
adopted by the Department of Trade and Industry, Bukidnon Provincial Office, as
one of its flagship projects. The same was likewise favorably recommended by
the Provincial Development Council of Bukidnon; the municipal, provincial and
regional office of the DAR; the Regional Office (Region X) of the DENR (which
issued an Environmental Compliance Certificate on June 5, 1995); the Executive
Director, signing "By Authority of PAUL G. DOMINGUEZ," Office of the President
— Mindanao; the Secretary of DILG; and Undersecretary of DECS Wilfredo D.
Clemente.

In the same vein, the National Irrigation Administration, Provincial Irrigation


Office, Bagontaas Valencia, Bukidnon, thru Mr. Julius S. Maquiling, Chief,
Provincial Irrigation Office, interposed NO. OBJECTION to the proposed
conversion "as long as the development cost of the irrigation systems thereat
which is P2,377.00 per hectare be replenished by the developer . . . ." Also, the
Kisolon-San Vicente Irrigators Multi Purpose Cooperative, San Vicente, Sumilao,
Bukidnon, interposed no objection to the proposed conversion of the land in
question "as it will provide more economic benefits to the community in terms of
outside investments that will come and employment opportunities that will be
generated by the projects to be put up . . . .

On the same score, it is represented that during the public consultation held at
the Kisolan Elementary School on 18 March 1995 with Director Jose
Macalindong of DAR Central Office and DECS Undersecretary Clemente, the
people of the affected barangay rallied behind their respective officials in
endorsing the project.

Notwithstanding the foregoing favorable recommendation, however, on


November 14, 1994, the DAR, thru Secretary Garilao, invoking its powers to
approve conversion of lands under Section 65 of R.A. No. 6657, issued an Order
denying the instant application for the conversion of the subject land from
agricultural to agro-industrial and, instead, placed the same under the
compulsory coverage of CARP and directed the distribution thereof to all
qualified beneficiaries on the following grounds:

1. The area is considered as a prime agricultural land with irrigation facility;

2. The land has long been covered by a Notice of Compulsory Acquisition (NCA);

3. The existing policy on withdrawal or lifting on areas covered by NCA is not


applicable;

4. There is no clear and tangible compensation package arrangements for the


beneficiaries;

5. The procedures on how the area was identified and reclassified for agro-
industrial project has no reference to Memo Circular No. 54, Series of 1993, E.O.
No. 72, Series of 1993, and E.O. No. 124, Series of 1993.

A Motion for Reconsideration of the aforesaid Order was filed on January 9, 1995
by applicant but the same was denied (in an Order dated June 7, 1995). 9

10. Thus, the DAR Secretary ordered the DAR Regional Director "to proceed with the
compulsory acquisition and distribution of the property." 10
11. Governor Carlos O. Fortich of Bukidnon appealed" the order of denial to the Office of the
President and prayed for the conversion/reclassification of the subject land as the same would
be more beneficial to the people of Bukidnon.

12. To prevent the enforcement of the DAR Secretary's order, NQSRMDC, on June 29, 1995,
filed with the Court of Appeals a petition for certiorari, prohibition with preliminary
injunction, 12 docketed as CA-G.R. SP No. 37614.

13. Meanwhile, on July 25, 1995, the Honorable Paul G. Dominguez, then Presidential Assistant
for Mindanao, after conducting an evaluation of the proposed project, sent a memorandum 13 to
the President favorably endorsing the project with a recommendation that the DAR Secretary
reconsider his decision in denying the application of the province for the conversion of the land.

14. Also, in a memorandum 14 to the President dated August 23, 1995, the Honorable Rafael
Alunan III, then Secretary of the Department of the Interior and Local Government (DILG),
recommended the conversion of the subject land to industrial/institutional use with a request
that the President "hold the implementation of the DAR order to distribute the land in question."

15. On October 23, 1995, the Court of Appeals, in CA-G.R. SP No. 37614, issued a
Resolution 15 ordering the parties to observe status quo pending resolution of the petition. At the
hearing held in said case on October 5, 1995, the DAR, through the Solicitor General,
manifested before the said court that the DAR was merely "in the processing stage of the
applications of farmers-claimants" and has agreed to respect status quo pending the resolution
of the petition. 16

16. In resolving the appeal, the Office of the President, through then Executive Secretary Ruben
D. Torres, issued a Decision in OP Case No. 96-C-6424, dated March 29, 1996, reversing the
DAR Secretary's decision, the pertinent portions of which read:

After a careful evaluation of the petition vis-a-vis the grounds upon which the
denial thereof by Secretary Garilao was based, we find that the instant
application for conversion by the Municipality of Sumilao, Bukidnon is impressed
with merit. To be sure, converting the land in question from agricultural to agro-
industrial would open great opportunities for employment and bring about real
development in the area towards a sustained economic growth of the
municipality. On the other hand, distributing the land to would-be beneficiaries
(who are not even tenants, as there are none) does not guarantee such benefits.

Nevertheless, on the issue that the land is considered a prime agricultural land
with irrigation facility it maybe appropriate to mention that, as claimed by
petitioner, while it is true that there is, indeed, an irrigation facility in the area, the
same merely passes thru the property (as a right of way) to provide water to the
ricelands located on the lower portion thereof. The land itself, subject of the
instant petition, is not irrigated as the same was, for several years, planted with
pineapple by the Philippine Packing Corporation.

On the issue that the land has long been covered by a Notice of Compulsory
Acquisition (NCA) and that the existing policy on withdrawal or lifting on areas
covered by NCA is not applicable, suffice it to state that the said NCA was
declared null and void by the Department of Agrarian Reform Adjudication Board
(DARAB) as early as March 1, 1992. Deciding in favor of NQSRMDC, the
DARAB correctly pointed out that under Section 8 of R.A. No. 6657, the subject
property could not validly be the subject of compulsory acquisition until after the
expiration of the lease contract with Del Monte Philippines, a Multi-National
Company, or until April 1994, and ordered the DAR Regional Office and the Land
Bank of the Philippines, both in Butuan City, to "desist from pursuing any activity
or activities covering petitioner's land.

On this score, we take special notice of the fact that the Quisumbing family has
already contributed substantially to the land reform program of the government,
as follows: 300 hectares of rice land in Nueva Ecija in the 70's and another 400
hectares in the nearby Municipality of Impasugong, Bukidnon, ten(10) years ago,
for which they have not received "just compensation" up to this time.

Neither can the assertion that "there is no clear and tangible compensation
package arrangements for the beneficiaries' hold water as, in the first place,
there are no beneficiaries to speak about, for the land is not tenanted as already
stated.

Nor can procedural lapses in the manner of identifying/reclassifying the subject


property for agro-industrial purposes be allowed to defeat the very purpose of the
law granting autonomy to local government units in the management of their local
affairs. Stated more simply, the language of Section 20 of R.A. No. 7160, supra,
is clear and affords no room for any other interpretation. By unequivocal legal
mandate, it grants local government units autonomy in their local affairs including
the power to convert portions of their agricultural lands and provide for the
manner of their utilization and disposition to enable them to attain their fullest
development as self-reliant communities.

WHEREFORE, in pursuance of the spirit and intent of the said legal mandate
and in view of the favorable recommendations of the various government
agencies abovementioned, the subject Order, dated November 14, 1994 of the
Hon. Secretary, Department of Agrarian Reform, is hereby SET ASIDE and the
instant application of NQSRMDC/BAIDA is hereby APPROVED. 17

17. On May 20, 1996, DAR filed a motion for reconsideration of the OP decision.

18. On September 11, 1996, in compliance with the OP decision of March 29, 1996, NQSRMDC
and the Department of Education, Culture and Sports (DECS) executed a Memorandum of
Agreement whereby the former donated four (4) hectares from the subject land to DECS for the
establishment of the NQSR High School. 18

When NQSRMDC was about to transfer the title over the 4-hectare donated to DECS, it
discovered that the title over the subject property was no longer in its name. It soon found out
that during the pendency of both the Petition for Certiorari, Prohibition, with Preliminary
Injunction it filed against DAR in the Court of Appeals and the appeal to the President filed by
Governor Carlos O. Fortich, the DAR, without giving just compensation, caused the cancellation
of NQSRMDC's title on August 11, 1995 and had it transferred in the name of the Republic of
the Philippines under TCT No. T-50264 19 of the Registry of Deeds of Bukidnon. Thereafter, on
September 25, 1995, DAR caused the issuance of Certificates of Land Ownership Award
(CLOA) No. 00240227 and had it registered in the name of 137 farmer-beneficiaries under TCT
No. AT-3536 20 of the Registry of Deeds of Bukidnon.

19. Thus, on April 10, 1997, NQSRMDC filed a complaint 21 with the Regional Trial Court (RTC)
of Malaybalay, Bukidnon (Branch 9), docketed as Civil Case No. 2687-97, for annulment and
cancellation of title, damages and injunction against DAR and 141 others. The RTC then issued
a Temporary Restraining Order on April 30, 1997 22and a Writ of Preliminary Injunction on May
19, 1997, 23 restraining the DAR and 141 others from entering, occupying and/or wresting from
NQSRMDC the possession of the subject land.

20. Meanwhile, on June 23, 1997, an Order 24 was issued by then Executive Secretary Ruben
D. Torres denying DAR's motion for reconsideration for having been filed beyond the
reglementary period of fifteen (15) days. The said order further declared that the March 29,
1996 OP decision had already become final and executory.

21. The DAR filed on July 11, 1997 a second motion for reconsideration of the June 23, 1997
Order of the President.

22. On August 12, 1997, the said writ of preliminary injunction issued by the RTC was
challenged by some alleged farmers before the Court of Appeals through a petition
for certiorari and prohibition, docketed as CA-G.R. SP No. 44905, praying for the lifting of the
injunction and for the issuance of a writ of prohibition from further trying the RTC case.

23. On October 9, 1997, some alleged farmer-beneficiaries began their hunger strike in front of
the DAR Compound in Quezon City to protest the OP Decision of March 29, 1996. On October
10, 1997, some persons claiming to be farmer-beneficiaries of the NQSRMDC property filed a
motion for intervention (styled as Memorandum In Intervention) in O.P. Case No. 96-C-6424,
asking that the OP Decision allowing the conversion of the entire 144-hectare property be set
aside. 25

24. President Fidel V. Ramos then held a dialogue with the strikers and promised to resolve
their grievance within the framework of the law. He created an eight (8)-man Fact Finding Task
Force (FFTF) chaired by Agriculture Secretary Salvador Escudero to look into the controversy
and recommend possible solutions to the problem. 26

25. On November 7, 1997, the Office of the President resolved the strikers' protest by issuing
the so-called "Win/Win" Resolution penned by then Deputy Executive Secretary Renato C.
Corona, the dispositive portion of which reads:

WHEREFORE, premises considered, the decision of the Office of the President,


through Executive Secretary Ruben Torres, dated March 29, 1996, is hereby
MODIFIED as follows:

1. NQSRMDC's application for conversion is APPROVED only with respect to the


approximately forty-four (44) hectare portion of the land adjacent to the highway,
as recommended by the Department of Agriculture.

2. The remaining approximately one hundred (100) hectares traversed by an


irrigation canal and found to be suitable for agriculture shall be distributed to
qualified farmer-beneficiaries in accordance with RA 6657 or the Comprehensive
Agrarian Reform Law with a right of way to said portion from the highway
provided in the portion fronting the highway. For this purpose, the DAR and other
concerned government agencies are directed to immediately conduct the
segregation survey of the area, valuation of the property and generation of titles
in the name of the identified farmer-beneficiaries.

3. The Department of Agrarian Reform is hereby directed to carefully and


meticulously determine who among the claimants are qualified farmer-
beneficiaries.

4. The Department of Agrarian Reform is hereby further directed to expedite


payment of just compensation to NQSRMDC for the portion of the land to be
covered by the CARP, including other lands previously surrendered by
NQSRMDC for CARP coverage.

5. The Philippine National Police is hereby directed to render full assistance to


the Department of Agrarian Reform in the implementation of this Order.

We take note of the Memorandum in Intervention filed by 113 farmers on October


10, 1997 without ruling on the propriety or merits thereof since it is unnecessary
to pass upon it at this time.

SO ORDERED. 27

A copy of the "Win-Win" Resolution was received by Governor Carlos O. Fortich of Bukidnon,
Mayor Rey B. Baula of Sumilao, Bukidnon, and NQSRMDC on November 24, 1997 28 and, on
December 4, 1997, they filed the present petition for certiorari, prohibition (under Rule 65 of the
Revised Rules of Court) and injunction with urgent prayer for a temporary restraining order
and/or writ of preliminary injunction (under Rule 58, ibid.), against then Deputy Executive
Secretary Renato C. Corona and DAR Secretary Ernesto D. Garilao.

On December 12, 1997, a Motion For Leave To Intervene 29 was filed by alleged farmer-
beneficiaries, through counsel, claiming that they are real parties in interest as they were
"previously identified by respondent DAR as agrarian reform beneficiaries on the 144-hectare"
property subject of this case. The motion was vehemently opposed 30 by the petitioners.

In seeking the nullification of the "Win-Win" Resolution, the petitioners claim that the Office of
the President was prompted to issue the said resolution "after a very well-managed hunger
strike led by fake farmer-beneficiary Linda Ligmon succeeded in pressuring and/or politically
blackmailing the Office of the President to come up with this purely political decision to appease
the 'farmers,' by reviving and modifying the Decision of 29 March 1996 which has been declared
final and executory in an Order of 23 June 1997. . . ."31 Thus, petitioners further allege,
respondent then Deputy Executive Secretary Renato C. Corona "committed grave abuse of
discretion and acted beyond his jurisdiction when he issued the questioned Resolution of 7
November 1997. . . ." 32 They availed of this extraordinary writ of certiorari "because there is no
other plain, speedy and adequate remedy in the ordinary course of law."33 They never filed a
motion for reconsideration of the subject Resolution "because (it) is patently illegal or contrary to
law and it would be a futile exercise to seek a reconsideration. . . ." 34
The respondents, through the Solicitor General, opposed the petition and prayed that it be
dismissed outright on the following grounds:

(1) The proper remedy of petitioners should have been to file a petition for review directly with
the Court of Appeals in accordance with Rule 43 of the Revised Rules of Court;

(2) The petitioners failed to file a motion for reconsideration of the assailed "Win-Win"
Resolution before filing the present petition; and

(3) Petitioner NQSRMDC is guilty of forum-shopping.

These are the preliminary issues which must first be resolved, including the incident on the
motion for intervention filed by the alleged farmer-beneficiaries.

Anent the first issue, in order to determine whether the recourse of petitioners is proper or not, it
is necessary to draw a line between an error of judgment and an error of jurisdiction. An error of
judgment is one which the court may commit in the exercise of its jurisdiction, and which error is
reviewable only by an appeal. 35 On the other hand, an error of jurisdiction is one where the act
complained of was issued by the court, officer or a quasi-judicial body without or in excess of
jurisdiction, or with grave abuse of discretion which is tantamount to lack or in excess of
jurisdiction. 36 This error is correctable only by the extraordinary writ of certiorari. 37

It is true that under Rule 43, appeals from awards, judgments, final orders or resolutions of any
quasi-judicial agency exercising quasi-judicial functions, 38 including the Office of the
President, 39 may be taken to the Court of Appeals by filing a verified petition for review 40 within
fifteen (15) days from notice of the said judgment, final order or resolution, 41 whether the appeal
involves questions of fact, of law, or mixed questions of fact and law. 42

However, we hold that, in this particular case, the remedy prescribed in Rule 43 is inapplicable
considering that the present petition contains an allegation that the challenged resolution is
"patently illegal" 43 and was issued with "grave abuse of discretion" and "beyond his (respondent
Secretary Renato C. Corona's) jurisdiction" 44 when said resolution substantially modified the
earlier OP Decision of March 29, 1996 which had long become final and executory. In other
words, the crucial issue raised here involves an error of jurisdiction, not an error of judgment
which is reviewable by an appeal under Rule 43. Thus, the appropriate remedy to annul and set
aside the assailed resolution is an original special civil action for certiorari under Rule 65, as
what the petitioners have correctly done. The pertinent portion of Section 1 thereof provides:

Sec. 1. Petition for certiorari. — When any tribunal, board or officer exercising
judicial or quasi-judicial functions has acted without or in excess of its or his
jurisdiction, or with grave abuse of discretion amounting to lack or excess of
jurisdiction, and there is no appeal, or any plain, speedy, and adequate remedy
in the ordinary course of law, a person aggrieved thereby may file a verified
petition in the proper court, alleging the facts with certainty and praying that
judgment be rendered annulling or modifying the proceedings of such tribunal,
board or officer, and granting such incidental reliefs as law and justice may
require.

xxx xxx xxx


The office of a writ of certiorari is restricted to truly extraordinary cases — cases in which
the act of the lower court or quasi-judicial body is wholly void. 45

The aforequoted Section 1 of Rule 65 mandates that the person aggrieved by the assailed
illegal act "may file a verified petition (for certiorari) in the proper court." The proper court where
the petition must be filed is stated in Section 4 of the same Rule 65 which reads:

Sec. 4. Where petition filed. — The petition may be filed not later than sixty (60)
days from notice of the judgment, order or resolution sought to be assailed in the
Supreme Court or, if it relates to the acts or omissions of a lower court or of a
corporation, board, officer or person, in the Regional Trial Court exercising
jurisdiction over the territorial area as defined by the Supreme Court. It may also
be filed in the Court of Appeals whether or not the same is in aid of its appellate
jurisdiction, or in the Sandiganbayan if it is in aid of its jurisdiction. If it involves
the acts or omissions of a quasi-judicial agency, and unless otherwise provided
by law or these Rules, the petition shall be filed in and cognizable only by the
Court of Appeals. (4a)

Under the above-qouted Section 4, the Supreme Court, Court of Appeals and Regional Trial
Court have original concurrent jurisdiction to issue a writ
of certiorari, 46 prohibition 47 and mandamus. 48 But the jurisdiction of these three (3) courts are
also delineated in that, if the challenged act relates to acts or omissions of a lower court or of a
corporation, board, officer or person, the petition must be filed with the Regional Trial Court
which exercises jurisdiction over the territorial area as defined by the Supreme Court. And if it
involves the act or omission of a quasi-judicial agency, the petition shall be filed only with the
Court of Appeals, unless otherwise provided by law or the Rules of Court. We have clearly
discussed this matter of concurrence of jurisdiction in People vs. Cuaresma, et. al.,49 through
now Chief Justice Andres R. Narvasa, thus:

. . . . This Court's original jurisdiction to issue writs of certiorari (as well as


prohibition, mandamus, quo warranto, habeas corpus and injunction) is not
exclusive. It is shared by this Court with Regional Trial Courts (formerly Courts of
First Instance), which may issue the writ, enforceable in any part of their
respective regions. It is also shared by this Court, and by the Regional Trial
Court, with the Court of Appeals (formerly, Intermediate Appellate Court),
although prior to the effectivity of Batas Pambansa Bilang 129 on August 14,
1981, the latter's competence to issue the extraordinary writs was restricted to
those "in aid of its appellate jurisdiction." This concurrence of jurisdiction is not,
however, to be taken as according to parties seeking any of the writs an
absolute, unrestrained freedom of choice of the court to which application
therefor will be directed. There is after all a hierarchy of courts. That hierarchy is
determinative of the venue of appeals, and should also serve as a general
determinant of the appropriate forum for petitions for the extraordinary writs. A
becoming regard for that judicial hierarchy most certainly indicates that petitions
for the issuance of extraordinary writs against first level ("inferior") courts should
be filed with the Regional Trial Court, and those against the latter, with the Court
of Appeals. (Citations omitted)

But the Supreme Court has the full discretionary power to take cognizance of the petition filed
directly to it if compelling reasons, or the nature and importance of the issues raised, warrant.
This has been the judicial policy to be observed and which has been reiterated in subsequent
cases, namely: 50 Uy vs. Contreras, et. al., 51 Torres vs. Arranz, 52 Bercero vs. De
53 54
Guzman, and Advincula vs. Legaspi, et. al. As we have further stated in Cuaresma:

. . . . A direct invocation of the Supreme Court's original jurisdiction to issue these


writs should be allowed only when there are special and important reasons
therefor, clearly and specifically set out in the petition. This is established policy.
It is a policy that is necessary to prevent inordinate demands upon the Court's
time and attention which are better devoted to those matters within its exclusive
jurisdiction, and to prevent further over-crowding of the Court's docket.

Pursuant to said judicial policy, we resolve to take primary jurisdiction over the present petition
in the interest of speedy justice 55 and to avoid future litigations so as to promptly put an end to
the present controversy which, as correctly observed by petitioners, has sparked national
interest because of the magnitude of the problem created by the issuance of the assailed
resolution. Moreover, as will be discussed later, we find the assailed resolution wholly void and
requiring the petitioners to file their petition first with the Court of Appeals would only result in a
waste of time and money.

That the Court has the power to set aside its own rules in the higher interests of justice is well-
entrenched, in our jurisprudence. We reiterate what we said in Piczon vs. Court of Appeals: 56

Be it remembered that rules of procedure are but mere tools designed to facilitate
the attainment of justice. Their strict and rigid application, which would result in
technicalities that tend to frustrate rather than promote substantial justice, must
always be avoided. Time and again, this Court has suspended its own rules and
excepted a particular case from their operation whenever the higher interests of
justice so require. In the instant petition, we forego a lengthy disquisition of the
proper procedure that should have been taken by the parties involved and
proceed directly to the merits of the case.

As to the second issue of whether the petitioners committed a fatal procedural lapse when they
failed to file a motion for reconsideration of the assailed resolution before seeking judicial
recourse, suffice it to state that the said motion is not necessary when the questioned resolution
is a patent nullity, 57 as will be taken up later.

With respect to the third issue, the respondents claim that the filing by the petitioners of: (a) a
petition for certiorari, prohibition with preliminary injunction (CA-G.R. SP No. 37614) with the
Court of Appeals; (b) a complaint for annulment and cancellation of title, damages and
injunction against DAR and 141 others (Civil Case No. 2687-97) with the Regional Trial Court of
Malaybalay, Bukidnon; and (c) the present petition, constitute forum shopping.

We disagree.

The rule is that:

There is forum-shopping whenever, as a result of an adverse opinion in one


forum, a party seeks a favorable opinion (other than by appeal or certiorari) in
another. The principle applies not only with respect to suits filed in the courts but
also in connection with litigation commenced in the courts while an administrative
proceeding is pending, as in this case, in order to defeat administrative
processes and in anticipation of an unfavorable administrative ruling and a
favorable court ruling. This specially so, as in this case, where the court in which
the second suit was brought, has no jurisdiction (citations omitted).

The test for determining whether a party violated the rule against forum shopping
has been laid down in the 1986 case of Buan vs. Lopez (145 SCRA 34), . . . and
that is, forum shopping exists where the elements of litis pendentia are present or
where a final judgment in one case will amount to res judicatain the other, as
follows:

There thus exists between the action before this Court and RTC
Case No. 86-36563 identity of parties, or at least such parties as
represent the same interests in both actions, as well as identity of
rights asserted and relief prayed for, the relief being founded on
the same facts, and the identity on the two preceding particulars is
such that any judgment rendered in the other action, will,
regardless of which party is successful, amount to res
adjudicata in the action under consideration: all the requisites, in
fine, of auter action pendant. 58

It is clear from the above-quoted rule that the petitioners are not guilty of forum shopping. The
test for determining whether a party has violated the rule against forum shopping is where a
final judgment in one case will amount to res adjudicata in the action under consideration. A
cursory examination of the cases filed by the petitioners does not show that the said cases are
similar with each other. The petition for certiorari in the Court of Appeals sought the nullification
of the DAR Secretary's order to proceed with the compulsory acquisition and distribution of the
subject property. On the other hand, the civil case in RTC of Malaybalay, Bukidnon for the
annulment and cancellation of title issued in the name of the Republic of the Philippines, with
damages, was based on the following grounds: (1) the DAR, in applying for cancellation of
petitioner NQSRMDC's title, used documents which were earlier declared null and void by the
DARAB; (2) the cancellation of NQSRMDC's title was made without payment of just
compensation; and (3) without notice to NQSRMDC for the surrender of its title. The present
petition is entirely different from the said two cases as it seeks the nullification of the assailed
"Win-Win" Resolution of the Office of the President dated November 7, 1997, which resolution
was issued long after the previous two cases were instituted.

The fourth and final preliminary issue to be resolved is the motion for intervention filed by
alleged farmer-beneficiaries, which we have to deny for lack of merit. In their motion, movants
contend that they are the farmer-beneficiaries of the land in question, hence, are real parties in
interest. To prove this, they attached as Annex "I" in their motion a Master List of Farmer-
Beneficiaries. Apparently, the alleged master list was made pursuant to the directive in the
dispositive portion of the assailed "Win-Win" Resolution which directs the DAR "to carefully and
meticulously determine who among the claimants are qualified farmer-beneficiaries." However,
a perusal of the said document reveals that movants are those purportedly "Found Qualified
and Recommended for Approval." In other words, movants are merely recommendee farmer-
beneficiaries.

The rule in this jurisdiction is that a real party in interest is a party who would be benefited or
injured by the judgment or is the party entitled to the avails of the suit. Real interest means
a present substantial interest, as distinguished from a mere expectancy or a future, contingent,
subordinate or consequential interest. 59 Undoubtedly, movants' interest over the land in
question is a mere expectancy. Ergo, they are not real parties in interest.

Furthermore, the challenged resolution upon which movants based their motion is, as intimated
earlier, null and void. Hence, their motion for intervention has no leg to stand on.

Now to the main issue of whether the final and executory Decision dated March 29, 1996 can
still be substantially modified by the "Win-Win" Resolution.

We rule in the negative.

The rules and regulations governing appeals to the Office of the President of the Philippines are
embodied in Administrative Order No. 18. Section 7 thereof provides:

Sec. 7. Decisions/resolutions/orders of the Office of the President shall, except


as otherwise provided for by special laws, become final after the lapse of fifteen
(15) days from receipt of a copy thereof by the parties, unless a motion for
reconsideration thereof is filed within such period.

Only one motion for reconsideration by any one party shall be allowed and
entertained, save in exceptionally meritorious cases. (Emphasis ours).

It is further provided for in Section 9 that "The Rules of Court shall apply in a suppletory
character whenever practicable.

When the Office of the President issued the Order dated June 23, 1997 declaring the Decision
of March 29, 1996 final and executory, as no one has seasonably filed a motion for
reconsideration thereto, the said Office had lost its jurisdiction to re-open the case, more so
modify its Decision. Having lost its jurisdiction, the Office of the President has no more authority
to entertain the second motion for reconsideration filed by respondent DAR Secretary, which
second motion became the basis of the assailed "Win-Win" Resolution. Section 7 of
Administrative Order No. 18 and Section 4, Rule 43 of the Revised Rules of Court mandate that
only one (1) motion for reconsideration is allowed to be taken from the Decision of March 29,
1996. And even if a second motion for reconsideration was permitted to be filed in
"exceptionally meritorious cases," as provided in the second paragraph of Section 7 of AO 18,
still the said motion should not have been entertained considering that the first motion for
reconsideration was not seasonably filed, thereby allowing the Decision of March 29, 1996 to
lapse into finality. Thus, the act of the Office of the President in re-opening the case and
substantially modifying its March 29, 1996 Decision which had already become final and
executory, was in gross disregard of the rules and basic legal precept that accord finalityto
administrative determinations.

In San Luis, et al. vs. Court of Appeals, et al. 60 we held:

Since the decisions of both the Civil Service Commission and the Office of the
President had long become final and executory, the same can no longer be
reviewed by the courts. It is well-established in our jurisprudence that the
decisions and orders of administrative agencies, rendered pursuant to their
quasi-judicial authority, have upon their finality, the force and binding effect of a
final judgment within the purview of the doctrine of res judicata [Brillantes v.
Castro, 99 Phil. 497 (1956), Ipekdijna Merchandizing Co., Inc. v. Court of Tax
Appeals, G.R. No. L-15430, September 30, 1963, 9 SCRA 72.] The rule of res
judicata which forbids the reopening of a matter once judicially determined by
competent authority applies as well to the judicial and quasi-judicial acts of
public, executive or administrative officers and boards acting within their
jurisdiction as to the judgments of courts having general judicial powers
[Brillantes v. Castro, supra at 503].

The orderly administration of justice requires that the judgments/resolutions of a court or quasi-
judicial body must reach a point of finality set by the law, rules and regulations. The noble
purpose is to write finis to disputes once and for all. 61 This is a fundamental principle in our
justice system, without which there would no end to litigations. Utmost respect and adherence to
this principle must always be maintained by those who wield the power of adjudication. Any act
which violates such principle must immediately be struck down.

Therefore, the assailed "Win-Win" Resolution which substantially modified the Decision of
March 29, 1996 after it has attained finality, is utterly void. Such void resolution, as aptly
stressed by Justice Thomas A. Street 62 in a 1918 case, 63 is "a lawless thing, which can be
treated as an outlaw and slain at sight, or ignored wherever and whenever it exhibits its
head." 64

WHEREFORE, the present petition is hereby GRANTED. The challenged Resolution dated
November 7, 1997, issued by the Office of the President in OP Case No. 96-C-6424, is hereby
NULLIFIED and SET ASIDE. The Motion For Leave To Intervene filed by alleged farmer-
beneficiaries is hereby DENIED.

No pronouncement as to costs.

SO ORDERED.

Regalado, Melo, Puno and Mendoza, JJ., concur.

Footnotes

1 Annex "AA," Petition; Rollo, pp. 163-167.

2 Annex "A," Petition; Ibid., pp. 48-63.

3 Annex "B," Petition; Rollo, pp. 64-655.

4 Par. 12, Petition; Ibid., p. 6.

5 Annex "C," Petition; ibid, pp. 66-67.

6 Annex "D," Petition; ibid., p. 68.

7 Annexes "E," "F" and "G," Petition; ibid., pp. 69-71.


8 Annex "H," Petition; Ibid., p. 72.

9 Annex "AA," Petition; Ibid., pp. 163-166.

10 Annex "S," Petition; Ibid., p. 113.

11 Annex "T," Petition; Ibid., pp. 115-120.

12 Annex "U," Petition; Ibid., pp. 121-146.

13 Annexes "V" and "V-1," Petition; Ibid., pp. 147-150.

14 Annex "W," Petition; Ibid., pp. 151-153.

15 Annex "X," Petition; Ibid., pp. 154-156.

16 Annex "Y," Petition; Ibid., pp. 157-158.

17 Ibid., pp. 166-167.

18 Par. 37, Petition, rollo, pp. 14-15.

19 Annex "BB," Petition; Ibid., p. 168.

20 Annex "CC," Petition; Ibid., pp. 169-176.

21 Annex "DD," Petition; Ibid., pp. 177-189.

22 Annex "EE," Petition; Rollo, pp. 190-191.

23 Annex "GG," Petition; Ibid., pp. 193-194.

24 Annex "FF," Petition; Ibid., p. 192.

25 Par. 17, Respondents' Comment, rollo, p. 532.

26 Par. 18, ibid., p. 533.

27 Rollo, pp. 61-62.

28 Par. 3, Petition; Ibid., p. 4.

29 Rollo, pp. 195-200.

30 Ibid., pp. 280-282.

31 Petition, ibid., p. 17.


32 Ibid., p. 18.

33 Ibid., p. 4.

34 Ibid., p. 5.

35 Fernando vs. Vasquez, et. al., 31 SCRA 288.

36 Ibid; Section 1, Rule 65, Revised Rules of Court.

37 Ibid.

38 Except those issued under the Labor Code of the Philippines (Sec. 2, Rule 43,
Revised Rules of Court).

39 Section 1, Rule 43, Revised Rules of Court.

40 Sections 3 & 5, ibid.

41 Section 4, ibid.

42 Section 3, ibid.

43 Petition, rollo, p. 5.

44 Ibid., p. 18.

45 Fernando vs. Vasquez, et al., 31 SCRA 288.

46 Section I, Rule 65, Revised Rules of Court; People vs. Cuaresma, et. al., 172 SCRA
415, 423; Vergara, Sr. vs. Suelto, et. al., 156 SCRA 753, 766.

47 Section 2, ibid.

48 Section 3, ibid.

49 Supra.

50 Cited in Regalado, Remedial Law Compendium, Vol. One, 1997 edition, p. 721.

51 G.R. Nos. 111416-17, Sept. 26, 1994.

52 G.R. No. 123352, Feb. 7, 1996.

53 G.R. No. 123573, Feb. 28, 1996.

54 G.R. No. 125500, Aug. 7, 1996.


55 Eugenio vs. Drilon, et. al., G.R. No. 109404, Jan. 22, 1996; 252 SCRA 106,110.

56 190 SCRA 31, 38.

57 Vigan Electric Light Co., Inc. vs. Public Service Commission, L-19850, Jan. 30, 1964;
Luzon Surety Co. vs. Marbella, et al., L-16088, Sept. 30, 1960; Dir. Of Lands vs.
Santamaria, 44 Phil. 594, all cited in Regalado, Remedial Law Compendium, supra, p.
710.

58 First Philippine International Bank, et. al. vs. Court of Appeals, et. al., 252 SCRA 259,
283 (Jan. 24, 1996).

59 Garcia vs. David, 67 Phil. 27.

60 174 SCRA 258, 271.

61 Legarda, et al. vs. Savellano, et al., 158 SCRA 194, 200.

62 One of the first Justices of the Supreme Court of the Philippines.

63 El Banco Español-Filipino vs. Palanca, 37 Phil. 921.

64 Ibid., at p. 949.
Case Digest: G.R. No. 131457 April 24, 1998

HON. CARLOS O. FORTICH, PROVINCIAL GOVERNOR OF BUKIDNON, HON. REY B. BAULA,


MUNICIPAL MAYOR OF SUMILAO, BUKIDNON, NQSR MANAGEMENT AND DEVELOPMENT
CORPORATION, petitioners, vs.

HON. RENATO C. CORONA, DEPUTY EXECUTIVE SECRETARY, HON. ERNESTO D. GARILAO,


SECRETARY OF THE DEPARTMENT OF AGRARIAN REFORM, respondents .

Facts:

The strikers protested the March 29, 1996 Decision 1 of the Office of the President (OP), issued through
then Executive Secretary Ruben D. Torres in OP Case No. 96-C-6424, which approved the conversion of
a one hundred forty-four (144)-hectare land from agricultural to agro-industrial/institutional area. This led
the Office of the President, through then Deputy Executive Secretary Renato C. Corona, to issue the so-
called "Win-Win" Resolution 2 on November 7, 1997, substantially modifying its earlier Decision after it
had already become final and executory. The said Resolution modified the approval of the land
conversion to agro-industrial area only to the extent of forty-four (44) hectares, and ordered the remaining
one hundred (100) hectares to be distributed to qualified farmer-beneficiaries.

But, did the "Win-Win" Resolution culminate in victory for all the contending parties?

The above-named petitioners cried foul. They have come to this Court urging us to annul and set aside
the "Win-Win" Resolution and to enjoin respondent Secretary Ernesto D. Garilao of the Department of
Agrarian Reform from implementing the said Resolution.

ISSUE:

Thus, the issue to be resolved in this case is: What is the legal effect of the "Win-Win" Resolution issued
by the Office of the President on its earlier Decision involving the same subject matter, which had already
become final and executor?

RULING:

No, the court ruled that the “Win-win” solution is null and void, as read in the dispositive part of the
Supreme Court decision:

Therefore, the assailed "Win-Win" Resolution which substantially modified the Decision of March 29, 1996
after it has attained finality, is utterly void. Such void resolution, as aptly stressed by Justice Thomas A.
Street 62 in a 1918 case, 63 is "a lawless thing, which can be treated as an outlaw and slain at sight, or
ignored wherever and whenever it exhibits its head." 64

WHEREFORE, the present petition is hereby GRANTED. The challenged Resolution dated November 7,
1997, issued by the Office of the President in OP Case No. 96-C-6424, is hereby NULLIFIED and SET
ASIDE. The Motion For Leave To Intervene filed by alleged farmer-beneficiaries is hereby DENIED.