[G.R. No. 104296.

March 29, 1996] SECOND DIVISION REPUBLIC OF THE PHILIPPINES, represented by the DIRECTOR OF LANDS, petitioner, vs. THE COURT OF APPEALS, HEIRS OF IRENE BULLUNGAN, represented by her husband DOMINGO PAGGAO and THE REGISTER OF DEEDS OF ISABELA, respondents. DECISION MENDOZA, J.: This is a petition for review of the decision [1] of the Court of Appeals reversing the decision of the Regional Trial Court, Branch XIX,[2]Cauayan, Isabela declaring Free Patent No. V-79740 and Original Certificate of Title No. P-88 17 in the name of Irene Bullungan null and void so far as the portion of Lot No. 1, Psu- 150801 involved in this case is concerned. The facts of this case are as follows: On September 10, 1955, Irene Bullungan (now deceased) applied for a free patent covering lots situated in Fugaru (now San Guillermo), Angadanan, Isabela. The lots included a portion of Lot No. 1, Psu-150801, between Lot No. 763 and Lot No. 764, consisting of 1.04 hectares, which Vicente Carabbacan claimed. In her application, Irene Bullungan stated that the land applied for by her was not claimed or occupied by any other person and that it was public land which had been continuously occupied and cultivated by her since 1925.[3] Upon certification of Assistant Public Land Inspector Jose M. Telmo at Ilagan, Isabela that Irene Bullungan had been in actual, continuous, open, notorious, exclusive and adverse possession of the land since 1925, the Director of Lands approved Bullungans application on June 4, 1957. On December 26, 1957, Original Certificate of Title No. P-8817 was issued in the name of Irene Bullungan. Alleging that a portion of Lot No. 1, Psu-150801 covered by the free patent issued to Irene Bullungan overlapped the lot between Lot No. 763 and Lot No. 764, which he was occupying, Vicente Carrabacan filed a protest on September 7, 1961. The District Land Officer at Ilagan, Isabela recommended the dismissal of the protest on the ground that the Bureau of Lands no longer had jurisdiction over the matter as a result of the grant of a free patent to Irene Bullungan. But the Director of Lands on March 23, 1982 ordered an investigation of the protest. Vicente Carabbacan also brought an action for the reconveyance of the portion of Lot No. 1, Psu-150801 and the cancellation of free patent against Irene Bullungan on September 5, 1961, although this was dismissed by the court without prejudice. The heirs of Irene Bullungan in turn sought to recover possession of the land in an action which they brought in the Court of First Instance of Isabela on April 13, 1972. The case was docketed as Civil Case No. Br. II1102. On the other hand, refusing to give up his claim, Vicente Carabbacan filed a case for reconveyance on August 15, 1972, which was docketed as Civil Case No. 1108. The cases were thereafter tried jointly. On November 22, 1972 the court rendered a decision, dismissing the complaint of Vicente Carabbacan and ordering him to vacate the land, even as it upheld the ownership of Irene Bullungan. Carabbacan, who had been in possession of the land in question, was finally ousted onDecember 10, 1981. As already stated, the Director of Lands ordered on March 23, 1982 an investigation of Carabbacans protest. The investigation was undertaken by Senior Special Investigator Napoleon R. Dulay, who found that Vicente Carabbacan had been in actual cultivation of the land identified as Lot No. 763, Pls-594 since 1947, having acquired the same from Tomas Tarayao on May 4, 1947. In his report dated September 17, 1985, the land investigator stated that due to a big flood which occurred in December 1947, the Cagayan River changed its course by moving northeast, resulting in the emergence of a piece of land, which is the subject of this dispute. Carrabacan took possession of the land and cultivated it. He was in the continuous, peaceful, open and adverse occupation and cultivation of the land from December 1947 until 1981 when he was ejected by virtue of the decision in Civil Cases No. 1088 and 11102.[4] Based on these findings, the Chief of the Legal Division of the Bureau of Lands recommended on March 10, 1986 that steps be taken to seek the amendment of Free Patent No. V-79740 and Original Certificate of Title No. P-8817 of the late Irene Bullungan so as to exclude the disputed portion and for the reversion of the same to the State. On November 28, 1986, the Solicitor General filed in behalf of the Republic of the Philippines a complaint for the cancellation of Free Patent No. V- 79740 and OCT No. P-8817 on the ground of fraud and misrepresentation in obtaining the free patent. The case was filed in the Regional Trial Court of Cauayan, Isabela which, on September 25, 1989, rendered a decision declaring Free Patent No. V-79740 and OCT No. P8817 null and void insofar as the portion of Lot No. 1, Psu-150801 between

Lot No. 763 and Lot No. 764, is concerned. The lower court found that Irene Bullungan made misrepresentations by claiming in her application for a free patent that she was in possession of the disputed portion of Lot No. 1, Psu-150801, when in fact Vicente Carabbacan was occupying and cultivating the land. The court justified the reversion of the land in question as an assertion of a governmental right. On appeal, however, the Court of Appeals reversed the lower courts ruling on the ground that, after the lapse of one year from the date of issuance of the patent, the State could no longer bring an action for reversion. The appellate court held that the certificate of title issued in the name of Irene Bullungan became incontrovertible and indefeasible upon the lapse of one year from the issuance of the free patent. The Republic controverts the ruling of the Court of Appeals. It contends that the doctrine of indefeasibility of Torrens Titles does not bar the filing of an action for cancellation of title and reversion of land even if more than one year has elapsed from the issuance of the free patent in case of fraud in obtaining patents. We agree with petitioner. To begin with, there is no question that Free Patent No. 79740 and Original Certificate of Title P-8817 were obtained through fraud. The trial court found that Irene Bullungan falsely stated in her application for a free patent that Lot No. 1, Psu-150801 was not claimed or occupied by any other person. The trial court found that a portion of the lot in question had been in the possession and cultivation of Vicente Carabbacan since December 1947.[5] Indeed private respondents admit that before Irene Bullungan filed her application for a free patent, she had filed a complaint for forcible entry against Vicente Carrabacan. The complaint, which was filed in the Justice of the Peace Court of Angadanan, Isabela, was dismissed precisely because the court found that Carabbacan had been in possession of the land long before it was sold to Irene Bullungan by Leonida Tarayao.[6] The Court of Appeals did not disturb the trial courts finding in this case that Irene Bullungan committed fraud and misrepresentation. Its decision rests solely on the ground that after the lapse of one year from the date of issuance of a free patent an action for the cancellation of patent and title on ground of fraud and misrepresentation can no longer be maintained. We think that this is error. It is settled that once a patent is registered under Act No. 496 (now P.D. No. 1529) and the corresponding certificate of title is issued, the land ceases to be part of the public domain and becomes private property over which the Director of Lands will no longer have either control or jurisdiction.[7] The Torrens Title issued on the basis of a free patent or homestead patent becomes as indefeasible as one which was judicially secured upon the expiration of one year from date of issuance of patent as provided in P.D. No. 1529, 32 (formerly Act No. 496, 38). However, as held in Director of Lands v. De Luna,[8] even after the lapse of one year, the State may still bring an action under 101[9] of the Public Land Act for the reversion to the public domain of lands which have been fraudulently granted to private individuals. This has been the consistent ruling of this Court.[10] The failure of Irene Bullungan to disclose that Vicente Carrabacan was in possession of the portion of land in dispute constitutes fraud and misrepresentation and is a ground for annulling her title.[11] Thus 91 of the Public Land Act provides: 91. The statements made in the application shall be considered as essential conditions and parts of any concession, title, or permit issued on the basis of such application, and any false statement therein or omission of facts altering, changing, or modifying the consideration of the facts set forth in such statements, and any subsequent modification, alteration, or change of the material facts set forth in the application shall ipso facto produce the cancellation of the concession, title, or permit granted. It shall be the duty of the Director of Lands, from time to time and whenever he may deem it advisable, to make the necessary investigations for the purpose of ascertaining whether the material facts set out in the application are true, or whether they continue to exist and are maintained and preserved in good faith, and for the purpose of such investigation, the Director of Lands is hereby empowered to issue subpoenas and subpoenas duces tecum and, if necessary, to obtain compulsory process from the courts. In every investigation made in accordance with this section, the existence of bad faith, fraud, concealment, or fraudulent and illegal modification of essential facts shall be presumed if the grantee or possessor of the land shall refuse or fail to obey a subpoena or subpoena duces tecumlawfully issued by the Director of Lands or his authorized delegates or agents, or shall refuse or fail. to give direct and specific answers to pertinent questions, and on the basis of such presumption, an order of cancellation may issue out further proceedings. The appellate court said in its decision:

We are not, of course, unaware of cases where the patent and the certificate of title issued pursuant thereto were declared null and void notwithstanding the expiration of the aforementioned period of one (1) year simply because of false statement of material and essential facts made in the application therefor. Be it noted, however, that in these cases the lots patented or granted were no longer part of the public domain but private ones segregated from the mass thereof. Consequently, no right whatsoever was awarded in said cases for it is already settled that a free patent which purports to convey land to which the government did not have any title at the time of its issuance does not vest any title in the patentee as against the true owner (Suva v. Ventura, 40 O.G. 8, 4th sup. August 23, 1941; Vital v. Anore, 90 Phil. 855; Director of Lands v. Abanilla, G.R. No. L-26324, August 31, 1983). This does not obtain in the present case for it is beyond dispute that the subject land was still a part of the public domain when the same was patented by the Government in favor of appellants predecessor in interest. Accordingly, there was indeed a title awarded such that when the same was brought under operation of Land Registration Act in 1957, it became incontrovertible in 1958.[12] This is not so. Where public land is acquired by an applicant through fraud and misrepresentation, as in the case at bar, the State may institute reversion proceedings even after the lapse of the one-year period. Nor is there merit in the claim of private respondents that the action taken by the Republic in this case is not in keeping with the policy of State to foster families as the factors of society, to give them a sense. of protection and permanency in their homes.[13] Public policy demands that one who obtains title to a public land through fraud should not be allowed to benefit therefrom. Vicente Carabbacan had been in possession of the land even. before Irene Bullungan bought the possessory rights to the land. It was therefore a misrepresentation for her to state in her application for a free patent that she had been in possession of the lot in question when the fact is that Carabbacan had been there ahead of her. WHEREFORE, the decision appealed from is REVERSED and the decision dated September 25, 1989 of the Regional Trial Court of Cauayan, Isabela, Branch XIX is REINSTATED. SO ORDERED.

EN BANC G.R. No. L-9989 March 13, 1918 EDUARDO CUAYCONG, ET AL., plaintiffs-appellees, vs. RAMONA BENEDICTO, ET AL., Defendants-Appellants. FISHER, J.: The issues in this case relate to the right of plaintiffs to make use of two roads existing on the Hacienda Toreno, a tract of land in the municipality of Victorias, Negros Occidental, the property of the defendants, Blasa Benedicto and Ramona Benedicto. One of these roads is referred to in the proceedings as the Nanca-Victorias road and the other as the Dacuman - Toreno road. The Court of First Instance held that those of the plaintiffs who claimed to be entitled to make use of the Dacuman - Toreno road had failed to establish the asserted right, and dismissed the action as to them. From this decision they appealed to this court but, their brief not having been filed within the time prescribed by the rules, their appeal was dismissed, on motion of defendants, by resolution dated February 14, 1916. Consequently, the issues presented on this appeal are limited to those which relate to the rights of the parties with respect to the Nanca-Victorias road, and the determination of the correctness of the decision of the court concerning that part of the controversy submitted to its decision. The allegations in the complaint with respect to the Nanca-Victorias road are that the appellees, Eduardo Cuaycong, Lino Cuaycong, and Eulalio Dolor, are the owners of a group of haciendas situated between the southern boundary of the Hacienda Toreno and the barrio of Nanca, of the municipality of Seravia, and that the appellees Silverio Ginoo, Gervasio Ascalon, and Juan Ledesma, are the lessees of part of said haciendas; that more than twenty years the appellees and their predecessors in interest have made use of the NancaVictorias road, which crosses the Hacienda Toreno, openly, publicly, and continiously, with the knowledge of the owners of the said hacienda, for the purpose of conveying the products of their haciendas to the town of Victorias and to the landing place there situated, and for the purpose of transporting supplies from those points to their haciendas, making use of the said road by means of carts, carabaos, and other usual means of transportation; that there is no outlet to a public road from the hacienda occupied by these plaintiffs, the only road and way by which the products of the plaintiffs' property can be taken to the town of Victorias and to the landing place there being across the Hacienda Toreno by the road marked on the plan attached to the complaint; that on the fifteenth day of November, 1912, the defendants closed the road in question at the point at which it crosses the Hacienda Toreno, and refused to permit plaintiffs to continue using it; that plaintiffs were about to commence to grind their crop of sugar cane, and that, if prevented from transporting their sugar across the Hacienda Toreno to their point of embarkation, would suffer damages difficult to estimate. Upon these averments of fact the plaintiffs prayed for a judgment that they are entitled to use the road in question as they have been using it in the past, and that a perpetual injunction be issued against plaintiffs restraining them from impending such use. Upon the filing of the complaint, plaintiffs moved the court to issue a preliminary injunction restraining defendants from interfering with the use of the road during the pendency of the suit, which motion was granted by the court. Defendants in their answer put in issue all the special averments of the complaint, as above set forth, and by way of counterclaim and special defense, averred that the road crossing the Hacienda Toreno, over which plaintiffs claim the right of passage, is the private property of defendants; and, further, that they have not refused plaintiffs permission to pass over this road but have required them to pay toll for the privilege of doing so. Defendants also claimed damages for the use of the road by plaintiffs during the pendency of the suit, alleging that the preliminary injunction had been improvidently issued upon false statements contained in the verified complaint filed by plaintiffs. The case was tried in July, 1913. The court on December 8, 1913, rendered judgment, dismissing the complaint with respect to the plaintiffs Felix Suarez, Probo Jereza, Enrique Azcona, and Melecio Pido, these being the plaintiffs who claimed the right to use the Dacuman Toreno road. With respect to the Nanca-Victorias road, the court held that it was a public highway over which the public had acquired a

right of use by immemorial prescription, and ordered the issuance of a perpetual injunction against plaintiffs, restraining them from interfering in any manner with the use of the said road. The conclusion of the court with respect to the facts affecting the Nanca-Victorias road are as follows: Turning to a consideration of the evidence relative to the NancaVictorias road we find incontestable proof that it has been in existence for at least forty years. That the hacenderos located in the southwestern section of Victorias and the public generally passed over it freely and that it was used for all purposes of transportation of farm produce, animals, etc. and by pedestrians as well as carromatas and other conveyances without break or interruption until two or three years ago when the defendants announced that the road was private and that those who wished to pass over it with sugar carts would be obliged to pay a toll of ten centavos - all other vehicles, it appears, were permitted to pass free charge. This arrangement seems to have existed during the years of 1911 and 1912 and part of 1913, the money being collected apparently from some hacenderos and not from others. There is some reason to believe from the evidence presented by defendants themselves that the practice of making these payments to hacienda 'Toreno' originated in an attempt to raise a fund for the repair of the road. There is no evidence that any other hacenderos between Nanca and Victorias or any other person made any attempt to close the road or to collect toll. On the contrary the road appears to have been repaired by the hacenderos when it needed repairing and everyone used it on equal terms until the defendants in 1910 or 1911 interposed the objection that the road in dispute was private. This we think is a fair deduction from the evidence and although it is asserted that toll was collected at an earlier date by the late Leon Montinola, brother of the defendant Ruperto Montinola, there is no tangible evidence that this was so and that toll has been paid only during the years of 1911, 1912, and part of 1913. The question presented by the assignment of error are in effect: (a) Is the Nanca-Victorias road at the point at which it traverses the Hacienda Toreno a public highway or not? (b) If it be held that the road in question is not a public highway, have plaintiffs proven their acquisition of an easement of way over the Hacienda Toreno at the point traversed by the road in question? The trial judge, in holding that the road in question is public, bases in conclusion upon the fact, which he deems to have been proven, that the road has been in existence "from time immemorial," and had been "continiously used as a public road . . . and open to public as such for thirty or forty years . . . until . . . the defendants undertook to claim it as private and to collect toll for the passage of carts." (Bill of Exceptions, p. 56.) There is no doubt that for the past thirty or forty years a road has existed between the former site of the town of Victorias and the barrio of Nanca, of the municipality of Seravia, and that this road crosses defendants' hacienda. It is also true that during this period the plaintiffs and their predecessors in the ownership of the hacienda now held by them have made use of this road for the purpose of going and coming from their haciendas to the town of Victorias; but the question is whether this use was limited to the plaintiffs, and their tenants and employees, or whether it was, as held by the lower court, a use enjoyed by the public in general. Plaintiffs produced only two witnesses, Segundo de Leon (stet. notes, pp. 2122) and Eduardo Cuaycong, (stet. notes, pp. 27-33) to testify as regards the use of the Nanca-Victorias road. Several other witnesses testified on behalf of plaintiffs, but their testimony relates to the Dacuman - Toreno road, which is not involved in this appeal. We have carefully read the testimony of the witnesses Leon and Cuaycong, given upon their direct and cross examination, but we have been unable to find that either of them has testified that the road in question was ever used by the public in general. These witnesses testified with regard to the use of the road by the present and former owners and occupants of the estates of Bacayan, Esperanza, Alcaigan, Pusot, and Dolores for the transportation of the products of these estates to the town of Victorias, and of supplies and agricultural implements from Victorias to the haciendas, but neither of them testified expressly that any other use had been made of said road. Nevertheless, it may be reasonably inferred from the testimony of these witnesses that all persons having occasion to travel between Victorias and the haciendas of Bacayan, Esperanza, Alacaigan, Pusot,

and Dolores, whether or not they were owners, tenants, or employees of said estates, made use of the road now in dispute, crossing the Hacienda Toreno, and to this limited extent it may be said that the public made use of the road, but there is nothing in the evidence to indicate that the so - called public use extended beyond this. Apart from the fact that there is no direct evidence to support the finding of the court concerning the general public use of the road in dispute, the record contains data strongly tending to show that when the complaint was filed plaintiffs did not contend that the road was a public highway, but merely contended that they had acquired by prescription an easement of way across the Hacienda Toreno. For example, the action is entitled an "action concerning a right of away." (Bill of Exceptions, pp. 64 and 65.) It is not averred in the complaint that the road in question was used by the public. On the contrary, it is averred that it was used by the plaintiffs and their predecessors. The averment in paragraph 8 of the complaint that the plaintiffs have no other "outlet to a public road" than that which they have been accustomed to used by going across the defendants' hacienda for the purpose of going to the town of Victorias also shows that when they commenced this action they had in mind the provisions of articles 564, et seq. of the Civil Code, which relate to the method of establishing the compulsory easement of way. The owners of an existing easement, as well as those whose properties are adjacent with a public road, have no occasion to invoke these provisions of the Code, which relate to the creation of new rights, and not the enforcement of rights already in existence. It is true in the opening statement made to the court, counsel for plaintiffs, who was not the same attorney by whom the complaint was signed, stated that plaintiffs contend that the road in question is public, but as no evidence was introduced tending to establish this contention concerning the Nanca - Victorias road, counsel for defendants had no occasion to object upon the ground that such testimony was not relevant to the averments of the complaint. No evidence was taken to indicate that at any time since the road in question has been in existence any part of the expense of its upkeep has been defrayed by the general government, the province, or the municipality. The trial judge said upon this subject: It is true that whatever repairs were made on the road were made irregularly. The municipality of Victorias had no funds to devote to the construction and repair of roads, and the upkeep of the road depending entirely therefore on the initiative of the persons who used it, was attended to only at such times as repairs were absolutely necessary. (Bill of Exceptions, p. 49.) The court also held that it appears from the government grant issued in 1885 to the original owner of the hacienda adjacent to the Hacienda Toreno on its western boundary, that the Nanca-Victorias road at that time separated that estate from the Jalbuena Hacienda, and that these facts constitute "circumstantial evidence that the road was in existence in 1885." We have examined the document to which the court refers, and we agree that the road in question existed in 1885; but we do not believe that the document in question proves that the road was public highway. Another circumstance established by the evidence, and which is some importance in the determination of this issue, is that although the defendants closed the Nanca-Victorias road in the month of February, 1911, and since that time have collected toll from persons passing over it with carts loaded with sugar, including those belonging to several of the plaintiffs, nothing was done by them to prevent the continuation of this restriction until December, 1912, when this action was commenced. It is natural to assume that if plaintiffs had considered that the road in question was public, they would have protested immediately against the action of the defendants, and would have either commenced a civil action, as they subsequently did, or would have brought about a prosecution under section 16 of Act No. 1511. Upon the evidence taken and admissions contained in the pleadings and those made during the course of the trial we consider that the following findings are warranted: 1. The town of Victorias has always been the shipping point of the products of the Hacienda Toreno, and of the haciendas of appellees,

as well as the place from which supplies were brought to those properties. 2. For thirty or forty years before the commencement of the suit a wagon road, herein called the Nanca-Victorias road, has been in existence, connecting the haciendas of appellees with the town of Victorias, and this road traverses the property of defendants. Since the removal of the town of Victorias to a new site the Nanca-Victorias road has been used by appellees in travelling between their properties and the provincial road which crosses the Hacienda Toreno from east to west. 3. No public funds have at any time been expended on the construction or upkeep of the Nanca-Victorias road, but from time to time work has been done on it by the laborers employed by the present and former owners of the Hacienda Toreno and the haciendas owned by the appellees and their predecessors in title. 4. The Nanca-Victorias wagon road, including that part of it which crosses the Hacienda Toreno, has for thirty-five or forty years been used by the appellees and their predecessors in title for the transportation, by the usual means, of the products of their estates to their shipping points in or near the town of Victorias, and the transportation to their estates of all supplies required by them, and has been used by all persons having occasion to travel to and from all or any of the estates now owned by the appellees. 5. The use of the Nanca-Victorias road in the manner and by the person above mentioned was permitted without objection by the owners of the Hacienda Toreno until the year 1911, when they closed it, and began charging a toll of 5 centavos for each cart which passed over the road, including carts belonging to the appellants, until restrained from continuing to do so by the preliminary injunction granted in this case. 6. The Nanca-Victorias road constitutes the only outlet from the estates of appellants to the nearest public road which is the provincial road which crosses the Hacienda Toreno from east to west. Upon these facts the questions of law to be decided are: (a) Is the Nanca-Victorias road a public highway? (b) If the Nanca-Victoria road, or that part of it which crosses the Hacienda Toreno, is not a public highway, is it subject to a private easement of way in favor of the appellees? The defendants are the owners of the Hacienda Toreno under a Torrens title issued in accordance with the Land Registration Act, conferring to them its absolute ownership, subject only to the limitations of paragraph four of section 39 of said Act. It is admitted that there is no annotation on the certificate of title regarding the road here in question, either as a "public road" or as a "private way established by law," and, therefore, the questions presented by this appeal are to be determined precisely as they would be had the Hacienda Toreno not been brought under the operation of the Land Registration Act. The plaintiffs being the owners of the property in question, the presumption of law is that it is free from any lien or encumbrance whatever, and the burden therefore rests upon plaintiffs to establish the contrary. As this court said in case of Fabie vs. Lichauco and the children of Francisco L. Roxas (11 Phil. Rep., 14): It is settled of law that a property is assumed to be free from all encumbrance unless the contrary is proved. There is admittedly no evidence to show that the land occupied by the road here in question was any time conveyed to the general government or any of its political subdivisions by the present or any of the former owners of the Hacienda Toreno. There is no evidence, even remotely, tending to show that the road existed prior to the time when the property now known as the Hacienda Toreno passed from the State into private ownership. The record fails to disclose any evidence whatever tending to show that the Government has at any time asserted any right or title in or to the land occupied by the road, or that it has incurred any expense whatever in its upkeep or construction. The Civil Code defines as public roads those which are

constructed by the State (art. 339), and as provincial and town roads those "the expense of which is borne by such towns or provinces." (Civil Code, art. 344.) While it is not contended that this definition is exclusive, it does show that during the Spanish regime, under normal conditions, roads which were public were maintained at the public expense, and that the fact that at no time was any expense incurred by the Government with respect to the road here in question tends strongly to support the contention of the defendants that it is private way. During the Spanish regime the law required each able to bodied citizen not within one of the exempted classes to work a certain number of days in each year, his labor to be devoted to "services of general utility" to the municipality of his residence. (Royal Decree of July 11, 1883, art. 5.) Under this Decree and the Regulations for its enforcement (Berriz, vol. 11, 258) the greater part of the work on the public road of the Islands was accomplished. Had the road here in question been a public way, it is reasonable to assume that the polistas of the town of Victorias would have been employed in maintaining it. It is most significant that no mention is made in the testimony of the plaintiffs' witnesses of any work of this character having been done on the road at any time, particularly in view of the fact that their attention was drawn to this point. (Stet. note, pp. 8, 10, 11, 12, 13 and 14.) The evidence shows that the repairs were made by the owners of the estates benefited by the road, and by their laborers, as a pure voluntary act for their own convenience and interest. There being no evidence of a direct grant to the government of the land occupied by the road in question or that any Government funds or labor were expended upon it, the question presents itself whether the use to which the road has been put was such as to justify the conclusion of the lower court that it has become public property. There being no evidence that the original use of the road by plaintiffs' predecessors was based upon any grant of the fee to the road or of an easement of way, or that it began under the assertion of a right on their part, the presumption must be that the origin of the use was the mere tolerance or license of the owners of the estates affected. This being so, has that merely permissive use been converted into a title vested in the public at large, or in the plaintiffs by reason of their ownership of the land beneficially affected by the use? Had it been shown that the road had been maintained at the public expense, with the acquiescence of the owners of the estates crossed by it, this would indicate such adverse possession by the government as in course of time would ripen into title or warrant the presumption of a grant or of a dedication. But in this case there is no such evidence, and the claims of plaintiffs, whether regarded as members of the public asserting a right to use the road as such, or as persons claiming a private easement of way over the land of another must be regarded as resting upon the mere fact of user. If the owner of a tract of land, to accommodate his neighbors or the public in general, permits them to cross his property, it is reasonable to suppose that it is not his intention, in so doing, to divest himself of the ownership of the land so used, or to establish an easement upon it and that the persons to whom such permission, tacit or express, is granted, do not regard their privilege of use as being based upon an essentially revocable license. If the use continues for a long period of time, no change being made in the relations of the parties by any express or implied agreement, does the owner of the property affected lose his right of revocation? Or, putting the same question in another form, does the mere permissive use ripen into title by prescription? It is a fundamental principle of the law in this jurisdiction concerning the possession of real property that such possession is not affected by acts of a possessory character which are "merely tolerated" by the possessor, or which are due to his license (Civil Code, arts. 444 and 1942). This principle is applicable not only with respect to the prescription of the dominium as a whole, but to the prescription of right in rem. In the case of Cortes vs. Palanca Yu Tibo (2 Phil. Rep., 24, 38), the Court said: The provision of article 1942 of the Civil Code to the effect that acts which are merely tolerated produce no effect with respect to possession is applicable as much to the prescription of real rights as

to the prescription of the fee, it being a glaring and self-evident error to affirm the contrary, as does the appellant in his motion papers. Possession is the fundamental basis of the prescription. Without it no kind of prescription is possible, not even the extraordinary. Consequently, if acts of mere tolerance produce no effect with respect to possession, as that article provides, in conformity with article 444 of the same Code, it is evident that they can produce no effect with respect to prescription, whether ordinary or extraordinary. This is true whether the prescriptive acquisition be of a fee or of real rights, for the same reason holds in one and the other case; that is, that there has been no true possession in the legal sense of the word. (See also Ayala de Roxas vs. Maglonso, 8 Phil Rep., 745; Municipality of Nueva Caceres vs. Director of Lands and Roman Catholic Bishop of Nueva Caceres, 24 Phil. Rep., 485.) Possession, under the Civil Code, to constitute the foundation of a prescriptive right, must be possession under claim of title (en concepto de dueno), or use the common law equivalent of the term, it must be adverse. Acts of a possessory character performed by one who holds by mere tolerance of the owner are clearly not en concepto de dueo, and such possessory acts, no matter how long so continued, do not start the running of the period of prescription. A similar question was presented in the case of the Roman Catholic Archbishop of Manila vs. Roxas (22 Phil. Rep., 450), in which case it appeared that Roxas, the owner of the Hacienda de San Pedro Macati, claimed a right of way across the property of the church to Calle Tejeron, a public street of the town of San Pedro Macati. The proof showed that the road in question had been used by the tenants of the Hacienda de San Pedro Macati for the passage of carts in coming and leaving the hacienda "from time immemorial," and further that the road had been used for time out of mind, not only by the tenants of the hacienda but by many other people in going and coming from a church half-way between the boundary line of the hacienda and Calle Tejeron. The court held that the facts did not give rise to a prescriptive right of easement in favor of the owner of the hacienda, upon the ground that such use "is to be regarded as permissive and under an implied license, and not adverse. Such a use is not inconsistent with the only use which the proprietor thought fit to make of the land, and until the appellee thinks proper to inclose it, such use is not adverse and will not preclude it from enclosing the land when other views of its interest render it proper to do so. And though an adjacent proprietor may make such use of the open land more frequently than another, yet the same rule will apply unless there be some decisive act indicating a separate and exclusive use under a claim of right. A different doctrine would have a tendency to destroy all neighborhood accommodations in the way of travel; for if it were once understood that a man, by allowing his neighbor to pass through his farm without objection over the pass-way which he used himself, would thereby, after the lapse of time, confer a right on such neighbor to require the pass-way to be kept open for his benefit and enjoyment, a prohibition against all such travel would immediately ensue." The decisions of the supreme court of Louisiana, a State whose jurisdiction is based, as is our own, upon the Roman Law, and whose Civil Code is taken, as is our own,. very largely from the Code of Napoleon, are particularly persuasive in matters of this character. In the case of Torres vs. Fargoust (37 La. Ann., 497), cited by appellants in their brief, in which the issues were very similar to those of the present case, the court held thatThe mere fact that for thirty or forty years the public was permitted to pass over this ground would not of itself constitute the place a locus publicus . . . dedication must be shown by evidence so conclusive as to exclude all idea of private ownership; . . . such dedication cannot be inferred from ere user alone; . . . no one is presumed to give away his property. The burden is on him who avers a divestiture of ownership to prove it clearly. We are, therefore, of the opinion, and so hold, that upon the facts established by the evidence it does not appear that the road in question is a public road or way. We are also of the opinion that plaintiffs have failed to show that they have acquired by prescription a private right of passage over the lands of defendants. The supreme court of Spain has decided that under the law in force before the enactment of the Civil Code, the easement of way was discontinous, and that while such an easement might be acquired by prescription, it must be used in good faith, in the belief of the existence of the right,

and such user must have been continuous from time immemorial. (Judgment of December 15, 1882.) In the appealed decision the court below says that the plaintiffs and their predecessors made use of the road in question "from time immemorial," but there is no evidence whatever in the record to sup[port this finding, although it is true that the evidence shows the existence of the road and its use by the plaintiffs and their predecessors for thirty-five or forty years. Speaking of the evidence required under the present Code of Civil Procedure to show immemorial use of an easement, this court said in the case of Ayal de Roxas vs. Case (8 Phil. Rep., 197, 198): Third Partida in title 31, law 15 . . . says that discontinues servitudes . . . must be proved by usage or a term so long that men can not remember its commencement. . . . In many judgments the supreme court of Spain has refused to accept proof of any definite number of years as a satisfaction of this requirement of the law. . . . We are of the opinion that in order to establish a right of prescription [title of prescription based upon use from time immemorial] something more required than memory of living witnesses. Whether this something should be the declaration of persons long dead, repeated by those who testify, as exacted by the Spanish law, or should be the common reputation of ownership recognized by the Code of Procedure, it is unnecessary for us to decide. On either theory the appellant has failed in his proof . . . . The same thing may be said in this case. Witnesses have testified that they have known the road for a certain period of years, beginning at a time prior to the enactment of the Civil Code, but no evidence has been made to prove immemorial use by either of the means of proof mentioned in this decision cited, nor is immemorial user averred in the complaint as the basis of the right. It is evident, therefore, that no vested right by user from time immemorial had been acquired by plaintiffs at the time the Civil Code took effect. Under that Code (art 539) no discontinuous easement could be acquired by prescription in any event. Assuming, without deciding, that this rule has been changed by the provisions of the present Code of Civil Procedure relating to prescription, and that since its enactment discontinuous easement may be required by prescription, it is clear that this would not avail plaintiffs. The Code of Civil Procedure went into effect on October 1, 1901. The term of prescription for the acquisition of rights in real estate is fixed by the Code (sec. 41) at ten years. The evidence shows that in February, 1911, before the expiration of the term of ten years since the time the Code of Civil Procedure took effect, the defendants interrupted the use of the road by the plaintiffs by constructing and maintaining a toll gate on it and collecting toll from persons making use of it with carts and continued to do so until they were enjoined by the granting of the preliminary injunction by the trial court in December, 1912. Our conclusion is, therefore, that the plaintiffs have not acquired by prescription a right to an easement of way over the defendant's property; that their use of the NancaVictorias road across the Hacienda Toreno was due merely to the tacit license and tolerance of the defendants and their predecessors in title; that license was essentially revokable; and that, therefore, the defendants were within their rights when they closed the road in 1911. While in the allegations from the plaintiffs' complaint it might be inferred that it was their purpose to seek to impose upon the defendants the easement to which arts. 564 et seq. of the Civil Code relate, that purpose was evidently abandoned, and the case was tried upon a wholly different theory. Proof was offered to show that the right of passage across defendants' land is necessary to enable plaintiffs to get their products to market, but there was no offer on their part to pay defendants the indemnity required by section 564. For the reasons stated the judgment of the court below is reversed, the injunction issued against defendants is allowed on this appeal. So ordered.

EN BANC G.R. No. 4701

September 22, 1908

THE ROMAN CATHOLIC APOSTOLIC CHURCH, ET AL., plaintiffsappellants, vs. ISABEL FAMILIAR, ET AL., defendants-appellees. Hartigan & Rhode for appellants. Jose Santiago for appellees. TRACEY, J.: Since times beyond the memory of the oldest witnesses there stood upon the land in dispute in Uacas, Cavite Viejo, a Roman Catholic chapel, when in use for religious purposes until September, 1905, when it was destroyed by a typhoon. Thereafter the defendants, who owned the adjoining land, took possession of it and continued to hold it as a part of their own property. In May, 1906, the plaintiff brought this action in the Court of First Instance to recover possession of it, and the defendants claim that the land on which the chapel stood originally belonged to their ancestor and that the ownership of it by him and by them was admitted by the regular annual payment to them by an hermano mayor of the sum of 50 centavos, and on his ground the Court of First Instance of Cavite awarded them judgment. It is clear that this defense can not prevail for several reasons: First, there is nothing to connect this plaintiff with the alleged annual payment. there is not a word to prove a cofradia, and its existence can not be inferred from the simple existence of an hermano mayor. (The Roman Catholic Apostolic Church vs.Santos, 7 Phil. Rep., 66.) The payment of this sum of 50 centavos, while sustained by declarations of two formerhermanos mayores, is disputed by many witnesses in a position to know about it, and its insignificance is hardly consistent with an annual rental. Second, the defense necessarily assumes as its basis the existence of the relation of landlord and tenant between the defendant and the plaintiff or its representatives. If such a relation existed, it could not be terminated arbitrarily by the act of the defendants; the tenant and the same right to retain possession of the property after the destruction of the chapel as before that event, until the lease had been put an end to by regular process of law. A landlord may not summarily enter and dispossess his tenant even for nonpayment of rent; and until the lease terminated the tenant has the right to the possession and may recover it from the landlord. (Cioco vs. Muro, 9 Phil. Rep., 100; Bago vs. Garcia, 5 Phil. Rep., 524; Bishop of Cebu vs.Mangaron, 6 Phil. Rep., 286.) There is nothing conflicting with this doctrine in the case of Evangelista vs. Ver (8 Phil. Rep., 653). there the plaintiff was defeated because the opinion of the majority of the court he failed to establish the fact of anterior possession, the proofs in their opinion showing such a relation of the two parties to each other and to their common superior, the owner, as to preclude the possibility of an exclusive possession in either, the defendant indeed never having been given up the occupancy of the property, but the plaintiff having in fact and by necessary construction of his acts abandoned it. Nor was it clear that the plaintiff, in his own showing, had been deprived of possession by "force, intimidation, strategy, or stealth" (5 Phil. Rep., 74), or by violation of a suitable contract, so as to bring his action within the scope of section 80, nor it had been so treated by the court below. (Rosco vs. Rebueno, 6 Off. Gaz., 1463.1) The principle of the decisions on that section is not affected by that case. The action appears to be well laid under the statute. It is only when brought for the possession of land detained by force, or by one of the other means specified in section 80 of the Code of civil Procedure that it must be commenced within the year in a court of a justice of the peace, otherwise it may begun in a Court of First Instance. (Ledesma vs,. Marcos, 9 Phil. Rep., 618; Alonso vs.Municipality of Placer, 5 Phil. Rep., 71.) This is a possessory action only and on the proofs the plaintiff is entitled to the possession of the property. The judgment of the court of First Instance in favor of the defendants is reversed, without costs. So ordered.

FIRST DIVISION [G.R. No. 114172. August 25, 2003] JUANITA P. PINEDA, assisted by her husband, CRISPIN PINEDA, and LILIA SAYOC, petitioners, vs. COURT OF APPEALS and TERESITA A. GONZALES, assisted by her husband, FRANCISCO G. GONZALES,respondents. DECISION CARPIO, J.: The Case This petition for review on certiorari[1] seeks to reverse the Decision[2] of the Court of Appeals dated 26 August 1993 in CA-G.R. SP No. 28651 as well as the Resolution dated 4 March 1994 denying the motion for reconsideration. In its assailed decision, the Court of Appeals declared void the orders[3] of the Regional Trial Court[4] of Cavite City dated 10 January 1992, 5 February 1992 and 30 April 1992, and made the preliminary injunction permanent. In the first order, the trial court declared that Teresita A. Gonzales, despite notice, failed to appear at the hearing of the motion to surrender Transfer Certificate of Title No. T-16084 and to file opposition to the motion. In the second order, the trial court declared void the original and owners duplicate of Transfer Certificate of Title No. T-16084 and ordered the reinstatement of Transfer Certificate of Title No. T8361. In the third order, the trial court denied the motions to lift the first order and to reconsider the second order. The Facts On 4 January 1982, the Spouses Virgilio and Adorita Benitez (Spouses Benitez) mortgaged a house and lot (Property) covered by Transfer Certificate of Title No. T-8361 (TCT 8361) in favor of Juanita P. Pineda (Pineda) and Leila P. Sayoc (Sayoc). The real estate mortgage secured the Spouses Benitezs loan of P243,000 with a one-year maturity period.[5] Pineda and Sayoc did not register the mortgage with the Register of Deeds. The Spouses Benitez delivered the owners duplicate of TCT 8361 to Pineda. On 9 November 1983, with the consent of Pineda, the Spouses Benitez sold the house,[6] which was part of the Property, to Olivia G. Mojica (Mojica). On the same date, Mojica filed a petition for the issuance of a second owners duplicate of TCT 8361 alleging that she purchased a parcel of land[7] and the owners duplicate copy of TCT No. T-8361 was lost.[8] On 7 December 1983, the trial court granted the petition. The Register of Deeds of Cavite City issued the second owners duplicate of TCT 8361 in the name of the Spouses Benitez. On 12 December 1983, the Spouses Benitez sold the lot[9] covered by TCT 8361 to Mojica. With the registration of the deed of sale and presentation of the second owners duplicate of TCT 8361, the Register of Deeds cancelled TCT 8361 and issued Transfer Certificate of Title No. T-13138 (TCT 13138) in the name of Mojica. On 22 February 1985, Mojica obtained a loan of P290,000 from Teresita A. Gonzales (Gonzales). Mojica executed a promissory note and a deed of mortgage over the Property in favor of Gonzales. Gonzales registered this deed of mortgage with the Register of Deeds of Cavite City who annotated the mortgage on TCT 13138 as Entry No. 33209. Meanwhile, on 8 May 1985, Pineda and Sayoc filed a complaint before the Regional Trial Court[10] of Cavite City, docketed as Civil Case No. 4654, against the Spouses Benitez and Mojica. The complaint prayed for the cancellation of the second owners duplicate of TCT 8361 and the award of moral damages and attorneys fees. In their answer, the Spouses Benitez admitted selling to Mojica the Property which was already subject to a previous mortgage in favor of Pineda and Sayoc. The Spouses Benitez claimed that under the Acknowledgment of Indebtedness,[11] Mojica, with the conformity of Pineda and Sayoc, agreed to assume the balance of the mortgage debt of the Spouses Benitez to Pineda and Sayoc. The Spouses Benitez denied any knowledge of Mojicas petition for the issuance of a second owners duplicate of TCT 8361. The Spouses Benitez prayed for the dismissal of the complaint and the award of moral damages and attorneys fees. The Spouses Benitez also prayed that in case the court would render judgment in favor of Pineda and Sayoc, only Mojica should be held liable. On the other hand, Mojica denied conspiring with the Spouses Benitez and committing fraud in filing the petition for the issuance of a second owners duplicate of TCT 8361. Mojica stated that the

Spouses Benitez sold to her the Property. Mojica claimed that upon the execution of the deed of sale, the Spouses Benitez delivered to her the owners duplicate of TCT 8361. However, Mojica alleged that the owners duplicate of TCT 8361 was lost. Mojica also asserted that she verified with the Register of Deeds of Cavite City the provision in the deed of sale that the Property was free from all liens and encumbrances and found the same to be true. Mojica added that on learning of the Spouses Benitezs mortgage with Pineda and Sayoc, she signed the Acknowledgment of Indebtedness. Mojica contended that since Pineda, for herself and Sayoc, conformed to this agreement, Pineda and Sayoc had no personality to file the complaint. Mojica further alleged that Pineda and Sayoc were in estoppel from challenging the validity of the second owners duplicate of TCT 8361 because Pineda and Sayoc, despite notice, failed to oppose the reconstitution of the title. Mojica maintained that the Spouses Benitez are indispensable parties because TCT 8361 was in their name. Mojica also asserted that she did not breach the Acknowledgment of Indebtedness since she had paid the Spouses Benitez an amount more than their debt to Pineda and Sayoc. Mojica contended that had the Spouses Benitez paid the amount to Pineda and Sayoc, there would have been no obligation to assume. Mojica prayed for the dismissal of the complaint and the award of moral and exemplary damages and attorneys fees. During the pendency of the case, Pineda caused the annotation on 18 August 1986 of a notice of lis pendens on the original of TCT 8361 with the Register of Deeds. After trial, the trial court rendered a Decision dated 15 June 1987, the dispositive portion of which reads: WHEREFORE, in view of the foregoing, the Court hereby renders judgment declaring the second owners duplicate of TCT No. T-8361 of the land records of Cavite as null and void and the Register of Deeds of Cavite City is hereby ordered upon payment of the corresponding legal fees the annotation of this pronouncement in its record and the revival of the first owners duplicate with the same faith and credit before its alleged loss. The counterclaim of defendants Benitezes is hereby dismissed. No pronouncement as to costs. SO ORDERED.[12] On 7 December 1987, Mojica defaulted in paying her obligation to Gonzales. Hence, Gonzales extrajudicially foreclosed the mortgage. On 27 January 1988, Gonzales purchased at public auction the Property for P423,244.88. For failure of Mojica to redeem the Property, Gonzales consolidated the title to the Property. On 29 March 1989, Gonzales executed the corresponding Affidavit of Consolidation. On 30 March 1989, the Register of Deeds of Cavite City cancelled TCT 13138, which was in Mojicas name, and issued Transfer Certificate of Title No. T-16084 (TCT 16084) in the name of Gonzales. TCT 16084 contained Entry No. 35520, the notice of lis pendens dated 18 August 1986 in relation to Civil Case No. 4654. [13] The Register of Deeds annotated on TCT 16084 the notice of lis pendens, even though TCT 13138 did not contain such annotation. Meanwhile, dissatisfied with the trial courts decision, the Spouses Benitez and Mojica appealed to the Court of Appeals, docketed as CA-G.R. CV No. 15417. On 29 January 1991, the Court of Appeals rendered a Decision[14] affirming the trial courts decision declaring void the second owners duplicate of TCT 8361. The decision of the Court of Appeals became final and was entered in the Book of Entries of Judgments on 17 June 1991. The Court of Appeals returned the records of the case to the trial court on 10 July 1991. On motion of Pineda and Sayoc, the trial court issued a writ of execution to enforce the judgment. However, the writ of execution was returned unsatisfied. The Sheriffs Return of 12 September 1991 stated that the Register of Deeds could not implement the writ of execution. The Sheriffs Return showed that the Register of Deeds had already cancelled TCT 8361 and issued TCT 16084 in the name of Gonzales by virtue of the consolidation of title dated 29 March 1989. Consequently, on 6 December 1991, Pineda and Sayoc filed a motion with the trial court for the issuance of an order requiring

Gonzales to surrender the owners duplicate of TCT 16084 to the Register of Deeds of Cavite City. In its Order dated 10 January 1992 (first order), the trial court declared that Gonzales, despite notice, failed to appear at the hearing and to oppose the motion to surrender TCT 16084. In the same order, the trial court directed Gonzales to file a memorandum. Gonzales received this order on 20 January 1992. Subsequently, Gonzales filed a motion to lift the first order alleging that since she was not a party in Civil Case No. 4654, the decision did not bind her. Gonzales also claimed that she did not receive notice of the hearing, copy of the motion to surrender TCT 16084 and the order resetting the hearing because she was in the United States of America. Gonzales finally alleged that she was an innocent purchaser for value. In an Order dated 5 February 1992 (second order), the trial court declared void the original and the owners duplicate of TCT 16084 in the name of Gonzales. The trial court ordered the reinstatement of TCT 8361 in the name of the Spouses Benitez. Gonzales filed a motion for reconsideration of the second order. On 30 April 1992, the trial court issued an Order (third order) denying Gonzales motions to lift the first order and to reconsider the second order. Aggrieved by the trial courts orders, Gonzales filed with the Court of Appeals a petition for the issuance of a writ of prohibitory injunction. On 26 August 1993, the Court of Appeals rendered a decision disposing as follows: WHEREFORE, the petition is granted. The assailed orders dated 10 January 1992, 5 February 1992, and 30 April 1992 are hereby declared NULL and VOID, and the preliminary prohibitory injunction is made permanent. SO ORDERED.[15] Hence, the instant petition.

Case No. 4654. The second paragraph of Section 108 of Presidential Decree No. 1529[16] (PD 1529) requires the filing of such separate petition. The appellate court stated that it was beyond the trial courts authority to act on the matter on a mere motion to surrender TCT 16084. The Court of Appeals likewise ruled that the trial court did not acquire jurisdiction over the person of Gonzales because she was not a party in Civil Case No. 4654. The appellate court found that Gonzales could not have known of, and appeared at, the hearing of the motion to surrender TCT 16084 because Gonzales was then out of the country. Assuming that the trial court could validly act on the motion of Pineda and Sayoc, the Court of Appeals declared that the orders nevertheless contravened Section 107 of PD 1529. This provision of law requires a hearing before the court can act on a petition to surrender a duplicate certificate of title. The Issues Petitioners raise the following issues for resolution: 1. Whether a notice of lis pendens binds a subsequent purchaser of the property to the outcome of the pending case. Whether TCT 13138 and TCT 16084, being derived from the void second owners duplicate of TCT 8361, are also void. Whether a separate action should be filed to cancel TCT 16084. Whether Gonzales was an innocent purchaser for value. Whether Gonzales was denied due process of law.

2.

3.

4.

5.

The Ruling of the Court We deny the petition.

The Ruling of the Court of Appeals

Validity of TCT 13138 and TCT 16084 Mojica filed a petition for reconstitution[17] of the owners duplicate of TCT 8361 claiming that this owners duplicate was lost. However, contrary to Mojicas claims, the owners duplicate of TCT 8361 was not lost but in Pinedas possession. Since the owners duplicate of TCT 8361 was in fact not lost or destroyed, there was obviously nothing to reconstitute or replace. Therefore, the trial court correctly ruled that the reconstitution proceedings and the second owners duplicate of TCT 8361 are void.[18] As the Court held in New Durawood Co., Inc. v. Court of Appeals:[19] In the instant case, the owners duplicate certificates of title were in the possession of Dy Quim Pong, the petitioners chairman of the board and whose family controls the petitioner-corporation. Since said certificates were not in fact lost or destroyed, there was no necessity for the petition filed in the trial court for the Issuance of New Owners Duplicate Certificates of Title . . . In fact, the said court never acquired jurisdiction to order the issuance of new certificates. Hence, the newly issued duplicates are themselves null and void. (Emphasis supplied) Mojica registered with the Register of Deeds the deed of sale executed by the Spouses Benitez conveying the Property to her. Mojica also presented to the Register of Deeds the second owners duplicate of TCT 8361. The Register of Deeds cancelled TCT 8361 and issued on 14 December 1983 TCT 13138 in the name of Mojica. However, since TCT 13138 is derived from the void second owners duplicate of TCT 8361, TCT 13138 is also void. No valid transfer certificate of title can issue from a void transfer certificate of title, unless an innocent purchaser for value has intervened.[20] Mojica was not a purchaser in good faith. Mojica alleged that the Spouses Benitez gave her the owners duplicate of TCT 8361 on 9 November 1983, the day the Spouses Benitez sold to her the house. However, in her petition for reconstitution, which she also filed

In the Court of Appeals, Gonzales maintained that the trial court had no jurisdiction over her person and property because Pineda and Sayoc did not implead her as a party in Civil Case No. 4654. Insisting that the questioned orders were procured through extrinsic or collateral fraud, Gonzales claimed that the orders of the trial court were void. Gonzales further alleged that she was an innocent purchaser for value making her title to the Property indefeasible and imprescriptible. Pineda and Sayoc, on the other hand, argued that the notice of lis pendens annotated on the title of the Property bound Gonzales, as subsequent purchaser of the Property, to the outcome of the case. Pineda and Sayoc contended that Gonzales was not a purchaser in good faith because Gonzales had constructive notice of the pending litigation when she purchased the Property. Moreover, Pineda and Sayoc argued that no separate action is necessary to cancel the title because Gonzales is bound by the outcome of the litigation. They contended that there was no extrinsic fraud because the notice of lis pendens warned Gonzales of the pendency of Civil Case No. 4654 where she could have intervened. Pineda and Sayoc further alleged that foreclosure and sale, not a mortgage, vest title on a mortgagee. Foreclosure and sale, however, are always subject to a notice of lis pendens. In granting the petition, the Court of Appeals ruled that the trial court erred when it voided TCT 16084 upon a mere motion for the surrender of the owners duplicate of TCT 16084. The Court of Appeals further held that the trial court erred in ordering the reinstatement of TCT 8361 in the name of the Spouses Benitez. The Court of Appeals held that Pineda and Sayoc should have filed the petition to surrender TCT 16084 in the original case where the decree of registration of TCT 16084 was entered and not in Civil

on the same day, 9 November 1983, Mojica claimed that the owners duplicate of TCT 8361 was lost. In effect, Mojica claimed that she received the owners duplicate of TCT 8361 from the Spouses Benitez, lost the same, and filed the petition for reconstitution, all on the same day, 9 November 1983. In her petition for reconstitution, Mojica also claimed that she purchased a parcel of land when in fact she only purchased on 9 November 1983 the house, and not the lot covered by TCT 8361. Obviously, Mojica procured the reconstitution of the second owners duplicate of TCT 8361 through misrepresentation. Hence, Mojica was not a purchaser in good faith when she later purchased on 12 December 1983 the lot since she knew of the irregularity in the reconstitution of the second owners duplicate of TCT 8361. Therefore, TCT 13138 issued in the name of Mojica is void. However, what is void is the transfer certificate of title and not the title over the Property. The title refers to the ownership of the Property covered by the transfer certificate of title while the transfer certificate of title merely evidences that ownership. A certificate of title is not equivalent to title as the Court explained in Lee Tek Sheng v. Court of Appeals:[21] xxx The certificate referred to is that document issued by the Register of Deeds known as the Transfer Certificate of Title (TCT). By title, the law refers to ownership which is represented by that document. Petitioner apparently confuses certificate with title. Placing a parcel of land under the mantle of the Torrens system does not mean that ownership thereof can no longer be disputed. Ownership is different from a certificate of title. The TCT is only the best proof of ownership of a piece of land. Besides, the certificate cannot always be considered as conclusive evidence of ownership. Mere issuance of the certificate of title in the name of any person does not foreclose the possibility that the real property may be under co-ownership with persons not named in the certificate or that the registrant may only be a trustee or that other parties may have acquired interest subsequent to the issuance of the certificate of title. To repeat, registration is not the equivalent of title, but is only the best evidence thereof. Title as a concept of ownership should not be confused with the certificate of title as evidence of such ownership although both are interchangeable. xxx (Emphasis supplied) Mojicas Title The prior mortgage of the Property by the Spouses Benitez to Pineda and Sayoc did not prevent the Spouses Benitez, as owners of the Property, from selling the Property to Mojica. A mortgage is merely an encumbrance on the property and does not extinguish the title of the debtor who does not lose his principal attribute as owner to dispose of the property.[22] The law even considers void a stipulation forbidding the owner of the property from alienating the mortgaged immovable.[23] Since the Spouses Benitez were the undisputed owners of the Property, they could validly sell and deliver the Property to Mojica. The execution of the notarized deed of sale between the Spouses Benitez and Mojica had the legal effect of actual or physical delivery. Ownership of the Property passed from the Spouses Benitez to Mojica.[24] The nullity of the second owners duplicate of TCT 8361 did not affect the validity of the sale as between the Spouses Benitez and Mojica. Gonzales Title After the sale of the Property to her, Mojica obtained a loan from Gonzales secured by a real estate mortgage over the Property. Gonzales registered this mortgage on 22 February 1985 with the Register of Deeds who annotated the mortgage on the void TCT 13138 in Mojicas name. The nullity of TCT 13138 did not automatically carry with it the nullity of the annotation of Gonzales mortgage. The rule is that a mortgage annotated on a void title is valid if the mortgagee registered the mortgage in good faith. [25] In Blanco v. Esquierdo,[26] the Court held: That the certificate of title issued in the name of Fructuosa Esquierdo is a nullity, the same having been secured thru fraud, is not here in question. The only question for determination is whether the defendant bank is entitled to the protection accorded to innocent purchasers for value, which phrase, according to sec. 38 of the Land

Registration Law, includes an innocent mortgagee for value. The question, in our opinion, must be answered in the affirmative. The trial court, in the decision complained of, made no finding that the defendant mortgagee bank was a party to the fraudulent transfer of the land to Fructuosa Esquierdo. Indeed, there is nothing alleged in the complaint which may implicate said defendant mortgagee in the fraud, or justify a finding that it acted in bad faith. On the other hand, the certificate of title was in the name of the mortgagor Fructuosa Esquierdo when the land was mortgaged by her to the defendant bank. Such being the case, the said defendant bank, as mortgagee, had the right to rely on what appeared in the certificate and, in the absence of anything to excite suspicion, was under no obligation to look beyond the certificate and investigate the title of the mortgagor appearing on the face of said certificate. (De Lara, et al. vs. Ayroso, 95 Phil., 185; 50 Off. Gaz., [10] 4838, Joaquin vs. Madrid, et al., 106 Phil., 1060). Being thus an innocent mortgagee for value, its right or lien upon the land mortgaged must be respected and protected, even if the mortgagor obtained her title thereto thru fraud. The remedy of the persons prejudiced is to bring an action for damages against those causing the fraud, xxx. (Emphasis supplied) Thus, the annotation of Gonzales mortgage on TCT 13138 was valid and operated to bind the Property and the world, despite the invalidity of TCT 13138. Gonzales registered her mortgage in good faith. Gonzales had no actual notice of the prior unregistered mortgage in favor of Pineda and Sayoc. To bind third parties to an unregistered encumbrance, the law requires actual notice.[27] The fact that Mojica, who sold the Property to Gonzales, had actual notice of the unregistered mortgage did not constitute actual notice to Gonzales, absent proof that Gonzales herself had actual notice of the prior mortgage. Thus, Gonzales acquired her rights as a mortgagee in good faith. When Mojica defaulted in paying her debt, Gonzales caused the extrajudicial foreclosure of the mortgaged Property. Gonzales purchased the mortgaged Property as the sole bidder at the public auction sale. For Mojicas failure to redeem the foreclosed Property within the prescribed period, Gonzales consolidated her title to the Property. Absent any evidence to the contrary, the sale at public auction of the Property to Gonzales was valid. Thus, the title or ownership of the Property passed from Mojica to Gonzales. At this point, therefore, Gonzales became the owner of the Property. When Gonzales purchased the Property at the auction sale, Pineda and Sayoc had already annotated the lis pendens on the original of TCT 8361, which remained valid. However, the mortgage of Gonzales was validly registered prior to the notation of the lis pendens. The subsequent annotation of the lis pendens could not defeat the rights of the mortgagee or the purchaser at the auction sale who derived their rights under a prior mortgage validly registered. The settled rule is that the auction sale retroacts to the date of the registration of the mortgage,[28] putting the auction sale beyond the reach of any intervening lis pendens, sale or attachment. As the Court explained in Caviles, Jr. v. Bautista:[29] We have also consistently ruled that an auction or execution sale retroacts to the date of levy of the lien of attachment. When the subject property was sold on execution to the petitioners, this sale retroacted to the date of inscription of petitioners notice of attachment on October 6, 1982. The earlier registration of the petitioners levy on preliminary attachment gave them superiority and preference in rights over the attached property as against respondents. Accordingly, we rule that the execution sale in favor of the petitioner Caviles spouses was anterior and superior to the sale of the same property to the respondent Bautista spouses on October 18, 1982. The right of petitioners to the surrender of the owners duplicate copy of TCT No. 57006 covering the subject property for inscription of the certificate of sale, and for the cancellation of said certificate of title and the issuance of a new title in favor of petitioners cannot be gainsaid. A contrary rule would make a prior registration of a mortgage or any lien meaningless.[30] The prior registered mortgage of Gonzales prevails over the subsequent notice of lis pendens, even if the auction sale took place after the notation of the lis pendens. Consequently,

TCT 16084, issued to Gonzales after she presented the sheriffs certificate of sale and her affidavit of consolidation, is valid. What remained with Pineda and Sayoc after the foreclosure was the mortgagors residual rights over the foreclosed Property, which rights are the equity of redemption[31] and a share in the surplus fund, if any.[32] Since Mojica was not a purchaser in good faith, the residual rights of Mojica were subject to the claim of Pineda and Sayoc. Of course, Pineda and Sayoc may still file an action to recover the outstanding debt of the Spouses Benitez, and even go after Mojica for her assumption of obligation under the Acknowledgment of Indebtedness. The Equities Favor Gonzales over Pineda and Sayoc Pineda and Sayoc were negligent in not registering their mortgage, which ultimately led to this controversy. Had Pineda and Sayoc registered their mortgage, their rights as prior mortgagees would have prevailed over that of Gonzales. Pineda and Sayoc were also negligent in not foreclosing their mortgage ahead of Gonzales, when they could have done so as early as 4 January 1983 after the Spouses Benitez defaulted on their loan.[33] In contrast, the loan of Mojica fell due only on 7 December 1987. Since Gonzales vigilantly exercised her right to foreclose the mortgaged Property ahead of Pineda and Sayoc, Gonzales mortgage would still prevail over the mortgage of Pineda and Sayoc even if Gonzales mortgage was not validly registered. The unregistered mortgage of Pineda and Sayoc was extinguished upon foreclosure of Gonzales mortgage even assuming for the sake of argument that the latter mortgage was unregistered. Between two unregistered mortgagees, both being in good faith, the first to foreclose his mortgage prevails over the other. Even assuming that Gonzales mortgage was not validly registered, the notice of lis pendens could still not defeat Gonzales right under the foreclosure sale. The effect of the notice of lis pendens was to subject Gonzales, as the subsequent purchaser of the Property, to the outcome of the case. The outcome of the case is the cancellation of the second owners duplicate of TCT 8361. The complaint of Pineda and Sayoc simply prayed for the cancellation of the second owners duplicate of TCT 8361 and the award of damages.
[34]

The notice of lis pendens would only bind Gonzales to the declaration of nullity of the second owners duplicate of TCT 8361. Gonzales could not use TCT 13138, as a void issue of the void second owners duplicate of TCT 8361, to secure a new TCT in her name. This is the legal consequence of the notice of lis pendens, which would have bound Gonzales had the registration of her mortgage been void. However, the declaration of nullity of TCT 13138 would still not make the mortgage of Pineda and Sayoc preferred over that of Gonzales. Since Gonzales foreclosed her mortgage ahead of Pineda and Sayoc, she would still have a better right than Pineda and Sayoc who slept on their rights as mortgagees. Conclusion The nullity of TCT 13138 did not affect the validity of the title or ownership of Mojica or Gonzales as subsequent transferees of the Property. What is void is the transfer certificate of title, not the title or ownership itself of Mojica or Gonzales. The notice of lis pendens could not defeat Gonzales rights over the Property for two reasons. First, Gonzales registered in good faith her mortgage before the notation of the lis pendens,making the registration of her mortgage valid despite the invalidity of TCT 13138. Second, since Gonzales mortgage was valid, the auction sale retroacted to the date of registration of her mortgage, making the auction sale prior in time to the notice of lis pendens. Thus, TCT 16084, issued to Gonzales as a result of the foreclosure sale, is valid. WHEREFORE, the petition is DENIED. The Decision dated 26 August 1993 and the Resolution dated 4 March 1994 of the Court of Appeals in CAG.R. SP No. 28651 are AFFIRMED. Petitioners Juanita P. Pineda and Lilia Sayoc are directed to surrender the owners duplicate of Transfer Certificate of Title No. 8361 to the Register of Deeds of Cavite City for cancellation. Transfer Certificate of Title No. 16084 in the name of Teresita A. Gonzales is declared valid. This is without prejudice to any action petitioners Juanita P. Pineda and Lilia Sayoc may file against the Spouses Virgilio and Adorita Benitez as well as Olivia G. Mojica. No pronouncement as to costs. SO ORDERED.

FIRST DIVISION [G. R. No. 137305. January 17, 2002] QUIRINO MATEO and MATIAS MATEO, petitioners, vs. DOROTEA DIAZ; REYNALDO DIAZ; REMEDIOS DIAZ; ADORACION DIAZ; NORBERTO DIAZ; YOLANDA CRUZ; OSCAR CRUZ; ESTER CRUZ; NENITA CRUZ; PRIMO POLICARPIO; GAVINO POLICARPIO; FLORENTINA POLICARPIO; MAURO POLICARPIO; and MIGUEL POLICARPIO, respondents. DECISION PARDO, J.: The Case This petition for review via certiorari[1] raises the question of whether or not the equitable doctrine of laches may override a provision of the Land Registration Act on imprescriptibility of title to registered land. The case is a petition for review on certiorari of the decision of the Court of Appeals[2] affirming that of the Regional Trial Court, Bulacan, atMalolos. The trial court ruled that prescription and laches are applicable against the petitioners, that real actions over immovable prescribe after thirty (30) years, that ownership can be acquired through possession in good faith and with just title for a period of ten (10) years, and that ownership may be acquired through uninterrupted adverse possession for thirty years without need of just title or of good faith. The Facts The facts, as found by the Court of Appeals,[3] are as follows: 1. The spouses Canuto Mateo and Simeona (Simona) Manuel-Mateo, during their marital union, were blessed with two (2) daughters, namely: CORNELIA MATEO and FELISA MATEO. In time, Cornelia will marry Ulpiano Diaz with whom she will have the following children, to wit: DOROTEA, REYNALDO, REMEDIOS, ADORACION and NORBERTO, all surnamed DIAZ. On the other hand, FELISA MATEO will eventually marry Cirilo Policarpio and they will raise the following children, namely: PRIMO, GAVINO, FLORENTINA, MAURO and MIGUEL, all surnamed POLICARPIO. Likewise, Cornelia will eventually have the following grandchildren, to wit: YOLANDA, OSCAR, ESTER and NENITA, all surnamed CRUZ. 2. Canuto Mateo died sometime in 1898. Not long thereafter, his widow Simeona will take in a second husband in the person of CLARO MATEO, a first cousin of Canuto. And out of their marital union, the spouses Claro Mateo and Simeona Manuel-Mateo will have two (2) sons, to wit: QUIRINO MATEO and MATIAS MATEO, the plaintiffsappellants herein. 3. The property involved in the controversy is an 11-hectare Riceland located at Bulak, Sta. Maria, Bulacan and covered by Original Certificate of Title (OCT) No. 206 issued by the Registry of Deeds of Bulacan on October 21, 1910 in the name of Claro Mateo, married to Simeona Manuel. 4. Claro Mateo died on September 8, 1932, while Simeona ManuelMateo died on October 18, 1948. 5. On June 12, 1951, the children of Simeon Manuel-Mateo in her two (2) previous marriages, namely: Cornelia Mateo-Diaz, Felisa MateoPolicarpio, QuirinoMateo and Matias Mateo, executed a document entitled KATIBAYAN NG PAGHAHATI-HATI NG LUPA (Exhibit B, 2/28/89, List of Exhibits, p. 60),whereunder they divided among themselves three (3) separate parcels of land all located at Bulak, Sta. Maria, Bulacan which they had inherited from their parents. These properties were then covered by Tax Declaration Nos. 3556, 3794 and 3849. It is not clear if these properties are part and parcel of that property covered by OCT No. 206. 6. At any rate, the parties to the said partition thenceforth occupied and possessed the respective areas allotted to each of them, their occupation thereof being peaceful, uninterrupted and continuous. 7. On February 15, 1979, in San Carlos City, Pangasinan, the brothers Quirino Mateo and Matias Mateo executed a DEED OF EXTRAJUDICIAL PARTITION (Exh. B, 12/22/81, List of Exhibits, p.

62), whereunder they partitioned between themselves alone, to the exclusion of their half-sisters Cornelia Mateo-Diaz and Felisa MateoPolicarpio, that 11-hectare parcel of Riceland covered by OCT No. 206. It was not explained if, at the time the brothers executed the deed, any or both of their half-sisters were already dead. In any event, the deed of extra-judicial partition was duly published in a daily newspaper, the Balita. 8. It was through this newspaper publication that the children of both Cornelia Mateo-Diaz and Felisa Mateo-Policarpio learned about the deed of extra-judicial partition executed by their uncles. 9. Sometime in 1981, some of the children and grandchildren of Cornelia and Felisa, namely: Reynaldo Diaz, Miguel Policarpio, Dorotea Diaz-Perez, FelicidadDiaz-Mercadel, Maxima and Yolanda Cruz represented by Oscar Cruz, and Ricardo Nolasco, filed a complaint for Declaration of Nullity of ExtraJudicial Partition with Damages against their uncles Quirino Mateo and Matias Mateo. Filed in the then Court of First Instance (CFI) of Bulacan, the complaint was docketed thereat as Civil Case No. SM975 (Exh. 15 sur-rebuttal). At the same time, a criminal information was filed at the proper court in San Carlos City, Pangasinancharging Quirino Mateo and Matias Mateo with falsification of public document. 10. On September 25, 1984, following a trial on the merits, the CFI, which, by now, has become the Regional Trial Court at Malolos, Bulacan rendered judgment in Civil Case No. SM-975 in favor of the plaintiffs therein (Exh. 17), by declaring as void and inexistent the Deed of Extra-Judicial Partition executed by the brothers Quirino Mateo and Matias Mateo. The records do not disclose when, but it was revealed that eventually, the proper court at San Carlos City, Pangasinanfound the brothers Quirino Mateo and Matias Mateo guilty of the crime of falsification of public document and sentenced them accordingly (Page 2, of Memorandum for the Plaintiffs, Rec., p. 314). 11. The record is likewise silent if Quirino Mateo and/or Matias Mateo had appealed both adverse decisions before the proper forum. 12. On April 1, 1987, in the Regional Trial Court at Malolos, Bulacan, Quirino Mateo and Matias Mateo commenced the present suit, which was originally a PETITION FOR DECLARATORY RELIEF, against (1) Dorotea Diaz, Reynaldo Diaz, Remedios Diaz, Adoracion Diaz and Norberto Diaz, the children of the late Cornelia Mateo-Diaz; (2) Yolanda Cruz, Oscar Cruz, Ester Cruz and Nenita Cruz, the grand-children of Cornelia; and (3) Primo Policarpio, Gavino Policarpio,Florentina Policarpio, Mauro Policarpio and Miguel Policarpio, the children of the late Felisa Mateo-Policarpio. The petition was docketed as Civil Case No. 165-SM-87. 13. On June 16, 1987, the defendants Diazes, Cruzes and Policarpios, with the exception of Doroteo Diaz, Reynaldo Diaz and Remedios Diaz-Sandel, filed a motion to dismiss the above petition on the following grounds: (a) the case was not referred to the barangay concerned for confrontation and mediation, as mandated by P. D. 1508; (b) there has been a decision previously rendered which involved the same parties over the same cause of action (obviously referring to the decision in Civil Case No. SM-975); and (c) the action is between members of the same family and no earnest efforts towards a compromise have been exerted (Records, pp. 60-63). The said motion to dismiss elicited an opposition from the petitioners (Rec., p. 79-83). 14. For their part, defendants Reynaldo Diaz and Remedios DiazSandel filed their separate motion to dismiss, grounded, as follows: (a) the lower court has no jurisdiction to hear and decide the case; (b) the complaint states no cause of action against them; (c) the cause of action of the petitioners is already barred by a prior judgment; (d) the case is between members of the same family and no earnest efforts towards a compromise have been made; and (e) the present case will not in any way terminate the uncertainty or controversy between the parties as any declaration or construction of the rights of the parties is not necessary and proper (Rec., pp. 84-89).

15. On August 27, 1987, the lower court issued an order dropping Reynaldo Diaz and Remedios Diaz-Sandel as party-defendants in the case (Rec., p. 93). 16. On December 4, 1987, defendant Dorotea Diaz filed her answer with compulsory counterclaim (Rec., pp. 106-109). 17. On October 11, 1988, the petitioners filed a Motion to Admit Complaint in Lieu of Petition, therein alleging that: 1. The evidence adduced and still to be adduced show the necessity of amending the petition into an ordinary complaint, so that the evidence could conform with the allegations of the cause of action sought to be established. 2. The conversion of the petition to an ordinary complaint would not affect the basic cause of action and defense of the defendants. (Rec., p. 143). Attached to the motion is the intended amended complaint where Reynaldo Diaz and Remedios Diaz-Sandel had been dropped as partydefendants (Rec., pp. 144-147). 18. In the said amended complaint, the plaintiffs Mateo brothers (Quirino and Matias alleged, inter alia: 2. The late Claro Mateo, was the absolute and exclusive owner of a parcel of land with an area of around eleven (11) hectares situated at Bulac, Sta. Maria,Bulacan and covered by Original Certificate of Title No. 206 x x x. xxx xxx xxx. 19. In an order dated November 28, 1988, the lower court granted the Motion to Admit Complaint in Lieu of Petition and accordingly admitted the amended complaint thereto attached (Rec., p. 151). 20. On September 8, 1989, the defendants filed their Amended Answer with Compulsory Counterclaim (Rec., pp. 199203), whereunder they raised the following special and affirmative defenses: 11. That the cause of action, if any, has already prescribed and also the petitioners are guilty of laches; xxx xxx xxx 14. That the parcel of land allegedly covered by and described in OCT No. 206 was/is actually non-existent as the same had been the subject of several conveyances and the late Claro Mateo had never laid claim over the said property/ies; 15. That since time immemorial, the late Melquiades Policarpio had been all along in possession of the land covered by and described in OCT No. 206; subsequently, the portion belonging to the former was inherited by Cirilo Policarpio x x x and then on May 13, 1968, the latter sold the property to defendant Miguel Policarpio as evidenced by a Deed of Sale x x x; 16. That likewise, the land- holding in question has been the subject of mortgage wherein some of the defendants and/or their predecessor-in-interest were the mortgagors to the exclusion of the plaintiffs who did not for once object to said mortgages; 17. That from 1910, the date OCT No. 206 was issued to Claro Mateo, to the year 1927, Felix Herrera was in actual possession of about 4 hectares of the subject land and on March 10, 1925 said portion was sold to Juana Badillo x x x who in turn sold the same to Ulpiano Diaz x x x who sold it to defendant Reynaldo Diaz x x x; 18. That furthermore, the landholding in question was acquired by Felisa Mateo from Claro Mateo and Simeona Manuel by purchase, thru a valid and sufficient consideration, as even certified to by said spouses in a document executed as early as 1914 x x x;

19. That in view of the several conveyances adverted to above OCT No. 206 should be cancelled and new ones issued to herein defendants, if said OCT is really authentic and/or genuine. The Issues The issues raised are: (1) whether prescription and the equitable principle of laches are applicable in derogation of the title of the registered owner; (2) whether the Court of Appeals erred in awarding attorneys fees to respondents.[4] The Courts Ruling We grant the petition. The land involved is registered under the Torrens system in the name of petitioners father Claro Mateo. There is no question raised with respect to the validity of the title. The factual issue now raised is that petitioners had slept on their rights and had not taken any positive step to assert their rights and interests over the land covered by OCT No. 206. The records will show that immediately after petitioners discovered the existence of OCT No. 206 in 1977 or 1978, they took steps to assert their rights thereto. They divided the land between the two of them in an extra-judicial partition. Then petitioners filed the case below to recover ownership and possession as the only surviving children of the original owner, the late Claro Mateo. In St. Peter Memorial Park, Inc. v. Cleofas,[5] we ruled that a party who had filed immediately a case as soon as he discovered that the land in question was covered by a transfer certificate in the name of another person is not guilty of laches. In J. M. Tuason & Co. v. Aguirre,[6] we ruled that an action to recover possession of a registered land never prescribes in view of the provision of Section 44 of Act No. 496[7] to the effect that no title to registered land in derogation to that of a registered owner shall be acquired by prescription or adverse possession. In fact, there is a host of jurisprudence that hold that prescription and laches could not apply to registered land covered by the Torrenssystem.[8] With more reason are these principles applicable to laches, which is an equitable principle. Laches may not prevail against a specific provision of law, since equity, which has been defined as justice outside legality is applied in the absence of and not against statutory law or rules of procedure.[9] On the other hand, the heirs of the registered owner are not estopped from claiming their fathers property, since they merely stepped into the shoes of the previous owners. In Barcelona v. Barcelona,[10] we held that: The property in litigation, being registered land under the provisions of Act 496, is not subject to prescription, and it may not be claimed that imprescriptibility is in favor only of the registered owner, because as we have held in the cases of Teofila de Guinoo, et al., v. Court of Appeals, (97 Phil. 235) and Gil Atun, et al., v.Eusebio Nuez (97 Phil. 762), prescription is unavailing not only against the registered owner, but also against his hereditary successors because the latter merely step into the shoes of the decedent by operation of law and are merely the continuation of the personality of their predecessor in interest. On the second issue, we rule that petitioners could not be liable for attorneys fees. An award of attorneys fees must have a factual, legal or equitable justification and cannot be left to speculation and conjecture.[11] In awarding attorneys fees, it is necessary for the court to make findings of fact and law that would justify the award.[12] On the third and last issue raised, we rule that the Court of Appeals erred in ordering the Register of Deeds to cancel OCT No. 206 of ClaroMateo and issue new titles to those who are occupying the subject land. This violates the indefeasibility of a Torrens title. The title of Claro Mateo could be cancelled only if there is competent proof that he had transferred his rights over the parcel of land to another party, otherwise title would pass to his heirs only by testate or intestate succession.

The Fallo WHEREFORE, the Court REVERSES the decision of the Court of Appeals.[13] In lieu thereof, the Court remands the case to the trial court for determination of the heirs of Claro Mateo in a proper proceeding. No costs. SO ORDERED.

FIRST DIVISION [G.R. No. 135219 : January 17, 2002] PHILIPPINE NATIONAL BANK, Petitioner, v. THE COURT OF APPEALS and ERNESTO AUSTRIA and LORETO Q. QUINTANA, Respondents. DECISION YNARES-SANTIAGO, J.: Before us is a petition for review under Rule 45 of the Rules of Court, seeking a reversal of the Court of Appeals resolution in CA-G.R. SP No. 48660 dated August 25, 1998, which affirmed the order of the Regional Trial Court of Makati, Branch 60 in LRC Case No. M-2635. Sometime during the late 70s, the spouses Godofredo and Wilma Monsod obtained a loan in the amount of P120,000.00 from petitioner Philippine National Bank (PNB). To secure their loan, the Monsods mortgaged to PNB a parcel of land covered by TCT No. S-84843, located within the Monte Villa de Monsod Subdivision in Paraaque, Rizal. Due to Monsods failure to pay their loan obligation, PNB extrajudicially foreclosed the mortgage. At the auction sale of the subject real property, PNB was declared the highest bidder. On December 21, 1981, a certificate of sale was issued in favor of PNB, and was registered on July 11, 1984.[1 Upon expiration of the redemption period on July 12, 1985, ownership of the property was consolidated in PNB. Thereafter, TCT No. S-84843 was cancelled and TCT No. 99480 was issued in PNBs name.[2 On June 23, 1992, PNB filed an Ex-Parte Petition for the Issuance of Writ of Possession with Branch 60 of theRegional Trial Court of Makati City, docketed as LRC Case No. M2635. Pursuant to the provisions of Act No. 3135, as amended, the trial court conducted an ex parte hearing. PNBs representative testified that the foreclosed property is occupied by one Ernesto Austria. According to PNB, Mr. Austria was invited by the bank to a conference to discuss the ownership of the foreclosed lot, however, he did not honor the banks invitation.[3 On August 28, 1992, the trial court granted PNBs petition and a writ of possession was issued on October 26, 1992.[4 On December 11, 1992, respondents Ernesto and Loreto Quintana Austria filed a Motion for Intervention and to Recall and/or Stop the Enforcement of the Writ of Possession. The Austrias alleged that they are the actual occupants of the subject lot, which they purportedly bought from the Monsods as early as 1974. They claimed that the foreclosed property was enclosed within a concrete fence and formed part of their family compound. PNB allegedly knew of this fact even before it granted the loan to the Monsods, because the banks credit investigators were advised of the same when they inspected the property in the summer of 1976. Consequently, the Austriasmaintained that the issuance of the possessory writ ex parte was improper, since it will deprive them of their property without due process.[5 Due to the Austrias refusal to vacate the premises, the sheriff failed to enforce the challenged writ. On July 27, 1993, on motion of PNB, the trial court issued an alias writ of possession. Again, the writ was not implemented.[6 On September 17, 1993, the sheriff sought to enforce the first alias writ of possession for the second time. TheAustrias filed a Second Motion for Intervention seeking to restrain the enforcement of the writ of possession issued on October 26, 1992.[7 PNB then filed an Urgent Ex-Parte Motion for Issuance of Break Open Order[8 and, subsequently, an Opposition to the Austrias Second Motion for Intervention.[9

On January 31, 1994, the trial court denied the Austrias second motion and granted PNBs Motion for Issuance of Break Open Order. The trial court ruled that the Austrias can no longer be permitted to intervene in the case during said stage of the proceedings and that the remedy of the Austrias was to file an ordinary civil action to assert their claim of ownership over the property.[10 In the meantime, the first alias writ of possession lapsed. PNB thus filed an Ex-Parte Motion for Issuance of Second Alias Writ of Possession,[11 and on November 29, 1994, a second alias writ was issued.[12 Unfazed, the Austrias filed an Omnibus Motion on January 25, 1995, seeking a recall of the second alias writ and a reconsideration of the trial courts order denying their motion to intervene.[13 Meanwhile, the second alias writ had likewise expired. PNB filed a Manifestation and Motion for Issuance of Third Alias Writ of Possession, which the trial court granted anew in an order dated October 10, 1995.[14 However, on December 12, 1995, the Austrias again filed a motion to set aside the trial courts order dated October 10, 1995 and to recall the third alias writ.[15 Consequent to the filing of this fourth motion, the sheriff again failed to implement the third alias writ, which also lapsed. Thus, on February 15, 1996, PNB filed another Motion for Issuance of a Fourth Alias Writ, [16 which was granted on March 26, 1996. The trial court, after hearing the Austrias fourth motion, issued an order on October 4, 1996, denying the same, on the ground that the issuance of a possessory writ for a property sold at public auction pursuant to an extra-judicial foreclosure proceeding was a ministerial duty on its part. The Austrias failed to establish any legal ground for recalling the writs, even as they claimed a superior right to the subject property.[17 On February 19, 1997, the fourth alias writ was issued by the trial court. The writ was partially implemented with the posting of PNB security guards within the premises of the foreclosed lot.[18 On April 17, 1997, the Austrias, for the fifth time, filed a motion to stop the enforcement of the fourth alias writ and to set aside all prior writs issued by the trial court.[19 In the meantime, the Austrias filed before the Regional Trial Court of Paraaque, an action for cancellation of PNBs title to the property, docketed as Civil Case No. 97-0184.[20 On October 28, 1997, the trial court denied the Austrias fifth motion but ruled that: any writ of possession that may be issued in this case, is declared unenforceable against the MOVANTS ERNESTO AUSTRIA and the HEIRS OF LORETOAUSTRIA, until the Court declares otherwise. [21 PNB filed a motion for reconsideration, which was denied on May 20, 1998.[22 A petition for certiorari under Rule 65 of the Rules of Court was filed by PNB before the Court of Appeals. However, the Court of Appeals dismissed the petition, stating: There is no prima facie showing of grave abuse of discretion on the part of respondent Judge in issuing his assailed Order which the Court finds to be in accord with law, the pertinent rules and jurisprudence cited therein. Hence, PNB filed the instant petition, contending that: I THE COURT OF APPEALS COMMITTED A SERIOUS ERROR BY SIMPLY ADOPTING THE FINDINGS OF THE TRIAL COURT THAT WRIT OF POSSESSION CANNOT BE ENFORCED AGAINST RESPONDENT AUSTRIA. SAID FINDINGS ARE UNPROVEN AND UNSUPPORTED BY EVIDENCE.

II THE COURT OF APPEALS MISAPPREHENSION OF FACTS IN:

COMMITTED

SERIOUS

Section 33, second paragraph, which relates to the right of possession of a purchaser of property in an extrajudicial foreclosure sale: Sec. 33. x x x Upon the expiration of the right of redemption, the purchaser or redemptioner shall be substituted to and acquire all the rights, title, interest and claim of the judgment obligor to the property at the time of levy. The possession of the property shall be given to the purchaser or last redemptioner by the same officer unless a third party is actually holding the property adversely to the judgment obligor. (Italics ours) Thus, in Barican v. Intermediate Appellate Court,[27 we held that the obligation of a court to issue an ex-parte writ of possession in favor of the purchaser in an extrajudicial foreclosure sale ceases to be ministerial once it appears that there is a third party in possession of the property who is claiming a right adverse to that of the debtor/mortgagor. The same principle was inversely applied in a more recent case,[28 where we ruled that a writ of possession may be issued in an extrajudicial foreclosure of real estate mortgage, only if the debtor is in possession and no third party had intervened. Although the factual nuances of this case may slightly differ from the aforecited cases, the availing circumstances are undeniably similar a party in possession of the foreclosed property is asserting a right adverse to the debtor/mortgagor and is a stranger to the foreclosure proceedings in which the ex-parte writ of possession was applied for. It should be stressed that the foregoing doctrinal pronouncements are not without support in substantive law. Notably, the Civil Code protects the actual possessor of a property, to wit: Art. 433. Actual possession under claim of ownership raises a disputable presumption of ownership. The true owner must resort to judicial process for the recovery of the property. Under the aforequoted provision, one who claims to be the owner of a property possessed by another must bring the appropriate judicial action for its physical recovery. The term judicial process could mean no less than an ejectment suit or reinvindicatory action, in which the ownership claims of the contending parties may be properly heard and adjudicated. An ex-parte petition for issuance of a possessory writ under Section 7 of Act No. 3135 is not, strictly speaking, a judicial process as contemplated above. Even if the same may be considered a judicial proceeding for the enforcement of ones right of possession as purchaser in a foreclosure sale, it is not an ordinary suit filed in court, by which one party sues another for the enforcement or protection of a right, or the prevention or redress of a wrong.[29 It should be emphasized that an ex-parte petition for issuance of a writ of possession is a non-litigious proceeding authorized in an extrajudicial foreclosure of mortgage pursuant to Act 3135, as amended. Unlike a judicial foreclosure of real estate mortgage under Rule 68 of the Rules of Court, any property brought within the ambit of the act is foreclosed by the filing of a petition, not with any court of justice, but with the office of the sheriff of the province where the sale is to be made.[30 As such, a third person in possession of an extrajudicially foreclosed realty, who claims a right superior to that of the original mortgagor, will have no opportunity to be heard on his claim in a proceeding of this nature. It stands to reason, therefore, that such third person may not be dispossessed on the strength of a mere ex-parte possessory writ, since to do so would be tantamount to his summary ejectment, in violation of the basic tenets of due process. Besides, as earlier stressed, Article 433 of the Civil Code, cited above, requires nothing less than an action for ejectment to be brought even by the true owner. After all, the actual possessor of a property enjoys a legal presumption of just title in his favor,[31 which must be overcome by the party claiming otherwise. In the case at bar, petitioner PNB admitted that as early as 1990, it was aware that the subject lot was occupied by the Austrias. Yet,

A) SUPPORTING THE JURISPRUDENCE CITED BY THE TRIAL COURT IN THE OCTOBER 28, 1997 ORDER. THE RULINGS DO NOT JUSTIFY THE NON-ENFORCEMENT OF THE WRIT OF POSSESSION AGAINST RESPONDENTS. RESPONDENTS WERE GIVEN THE OPPORTUNITY TO BE HEARD BUT NO EVIDENCE WAS PRESENTED TO SUPPORT THEIR CLAIM; B) NOT GIVING DUE CONSIDERATION TO THE FACT THAT PNB HAS THE LEGAL RIGHT TO POSSESS THE PROPERTY AS ITS REGISTERED OWNER; C) LOSING SIGHT OF THE FACT THAT THE TRIAL COURT BELATEDLY ISSUED THE OCTOBER 28, 1997 ORDER DIRECTING THAT THE WRIT OF POSSESSION CANNOT BE ENFORCED AGAINST THE RESPONDENTS. THE TRIAL COURT HAD EARLIER ISSUED FOUR (4) POSSESSORY WRITS ALL OF WHICH WERE DIRECTED AGAINST RESPONDENTS AUSTRIA & QUINTANA.[23 The basic issue to be resolved in this case is whether or not an exparte writ of possession issued pursuant to Act No. 3135, as amended, can be enforced against a third person who is in actual possession of the foreclosed property and who is not in privity with the debtor/ mortgagor.[24 Petitioner PNB maintains that the trial courts order was based on the unproven allegation that respondents had purchased the property from the Monsods before the latter mortgaged it to PNB. According to petitioner PNB, respondents did not adduce any proof to support their claim of ownership, even as they were repeatedly given the opportunity to do so during the hearings on the numerous motions filed by respondents themselves. Petitioner PNB also submits that since it is the registered owner of the property, it is entitled to a writ of possession as a matter of right. The bank insists that it could rely on the title of the registered land which does not have any annotation of respondents supposed rights. Petitioner PNB likewise avers that the trial court could not now belatedly refuse to enforce the writ of possession against respondents. The trial court had already issued a total of four possessory writs directing the ouster of all occupants of the lot, including respondents herein. On the other hand, respondents assert that the trial court correctly held that the writ of possession can only be implemented against the debtor/mortgagor and his successors-in-interest. Since respondents acquired their rights as owners of the property by virtue of a sale made to them by the Monsods prior to the banks mortgage lien, respondents can not be dispossessed therefrom without due notice and hearing, through the simple expedient of an ex-parte possessory writ. We agree with respondents. Under applicable laws and jurisprudence, they can not be ejected from the property by means of an exparte writ of possession. The operative provision under Act No. 3135, as amended,[25 is Section 6, which states: Sec. 6. Redemption. In all cases in which an extrajudicial sale is made under the special power hereinbefore referred to, the debtor, his successors in interest or any person having a lien on the property subsequent to the mortgage or deed of trust under which the property is sold, may redeem the same at any time within the term of one year from and after the date of the sale; and such redemption shall be governed by the provisions of section four hundred and sixty-four to four hundred and sixty-six, inclusive, of the Code of Civil Procedure, in so far as these are not inconsistent with the provisions of this Act. (Italics ours) Despite the evolutionary development of our procedural laws throughout the years, the pertinent rule in the Code of Civil Procedure[26 remains practically unchanged. Particularly, Rule 39,

instead of bringing an action in court for the ejectment of respondents, it chose to simply file an ex-parte petition for a writ of possession pursuant to its alleged right as purchaser in the extrajudicial foreclosure sale. We cannot sanction this procedural shortcut. To enforce the writ against an unwitting third party possessor, who took no part in the foreclosure proceedings, would be tantamount to the taking of real property without the benefit of proper judicial intervention. Consequently, it was not a ministerial duty of the trial court under Act No. 3135 to issue a writ of possession for the ouster of respondents from the lot subject of this instant case. The trial court was without authority to grant the ex-parte writ, since petitioner PNBs right of possession under said Act could be rightfully recognized only against the Monsods and the latters successors-in-interest, but not against respondents who assert a right adverse to the Monsods. Hence, the trial court cannot be precluded from correcting itself by refusing to enforce the writs it had previously issued. Its lack of authority to direct issuance of the writs against respondents assured that its earlier orders would never attain finality in the first place. In the same vein, respondents are not obliged to prove their ownership of the foreclosed lot in the ex-parteproceedings conducted below. The trial court has no jurisdiction to determine who between the parties is entitled to ownership and possession of the foreclosed lot. Likewise, registration of the lot in petitioner PNBs name does not automatically entitle the latter to possession thereof. As discussed earlier, petitioner PNB must resort to the appropriate judicial process for recovery of the property and cannot simply invoke its title in an ex-parte proceeding to justify the ouster of respondents. WHEREFORE, the instant petition is DENIED and the resolution of the Court of Appeals in CA G.R. SP No. 48660 is AFFIRMED. SO ORDERED.

EN BANC G.R. No. 34004

September 12, 1931

APOLONIA CALMA, ET AL., plaintiffs-appellants, vs. EULALIO CALMA, defendant-appellant. Patricio T. Rigor and Jose P. Fausto for plaintiffs-appellants. Quirino and Sarandi and Maglanoc and Castro for defendantappellant. ROMUALDEZ, J.: Under three causes of action the plaintiffs pray that the defendant be ordered to liquidate the yearly crops of the plantation described in paragraph II of the complaint, from the year 1903, delivering to the plaintiffs their share, or its value; that said property be divided equally into two parts and the half which, in justice and equity, belongs to the plaintiffs be adjudicated to them; that the defendant be compelled to restore to the plaintiffs the property described in paragraph VIII of the complaint, or its value, which is P56,300, and to pay them P66,000 damages, and the costs. After entering a general and specific denial of the complaint, the defendant set up a number of special defenses and a counterclaim, praying that he be absolved from the complaint and the plaintiffs be sentenced to pay him P13,660.40 on several counterclaims, besides the costs. After hearing the evidence, the Court of First Instance of Tarlac found that both the complaint and the counterclaim had prescribed, and dismissed both, without pronouncement of costs. Both parties appealed from that decision, the plaintiffs assigning the following errors: 1. In finding that the plaintiffs' cause of action petitioning for the liquidation of the rents or profits from lot No. 283, cadastral survey of Gerona, Tarlac, has prescribed. 2. In not holding that the plaintiffs, as undivided co-owners of one-half of said lot are entitled to one-half of the annual income of 450 cavanes, i. e., 225 cavanes of palay a year, or their cash value, according to the current prices during the period from 1903 to 1927; 3. In not finding that the total value of the one-half belonging to the plaintiffs of said rental is P17,554; and "4. In dismissing the plaintiffs' action and in not sentencing the defendant to pay said plaintiffs the aforesaid sum of P17,554, with legal interest from the date of the complaint, and the costs of the trial. The defendant, in turn, assigned the following errors to the court below, to wit: 1. The court a quo erred in applying the statute of limitations to the counterclaims of the appellant. 2. The court a quo erred in refusing to order Facundo Salazar, official stenographer thereof, to transcribe his notes on the testimony of Ernesto Quirino. The question raised by the plaintiffs on appeal is summed up in their first cause of action, with reference to the crops grown on lot No. 283 from the year 1930, contending that the statute of limitations invoked by the defendant in his amended answer is not in point because the latter has been in possession only as a joint owner, and because even if he were in possession as the exclusive owner, the running of the prescriptive period was interrupted by the decision of the competent court in 1927 declaring that the defendant was only a coowner, and not the sole owner of the lot in question.

The record shows that the defendant was in possession of all the land from 1903 until 1927 not as a mere administrator, as the complaint alleges, nor even as a mere coowner, but as the sole and absolute owner, in good faith, and adversely to the plaintiffs. He is therefore protected by subsection 3 of section 43 of the Code of Civil Procedure. The interruption of his possession in 1927 did not deprive him of the right which, as a possessor in good faith, he had to take for himself the products of the land up to that year, according to article 451 of the Civil Code. The plaintiffs' appeal, then, is not well taken. As to that for the defendant, similarly confined to items (a), (f) and (h) of his counterclaim, with reference to certain sums alleged to have been disbursed by the defendant for the benefit of Gabino Calma, the predecessor in interest of the plaintiffs, for P3,995 paid to creditors, P500 paid to attorney Pedro Liongson, and for P750 or P500 paid to Paulo Macasaquit, which comprise the one-half which the plaintiff's predecessor had to pay; it is contended that the trial court should not have applied the statute of limitations in favor of the plaintiffs, inasmuch as they had not set it up as a defense. We have indeed failed to find among the plaintiffs' pleadings any allegation of prescription against the defendant's counterclaim. The statute of limitations must be pleaded in the answer and cannot be set up by a demurrer or proved under a general denial. (Domingo vs. Osorio, 7 Phil., 405; Pelaez vs. Abreu, 26 Phil., 415; Karagdag vs. Barado, 33 Phil., 529.) The plaintiffs should have replied to the counterclaim if they had desired to set up such an affirmative defense as the statute of limitations, because silence meant only that they generally denied the allegations of the defendant's answer. (Sec. 104, Code of Civil Procedure; Herranz & Garriz vs. Barbudo, 12 Phil., 5; Yu Chin Piao vs. Lim Tuaco, 33 Phil., 92.) It happens, however, that the plaintiffs are not under obligation to pay the debts of their late father, such as items (a), (f), and (h) of the counterclaim. It does not appear that they personally bound themselves to pay them, and the mere fact that they are the deceased's heirs does not make them answerable for such credits against their predecessor in interest, inasmuch as article 1003 of the Civil Code is no longer in force, having been abrogated by certain provisions of the Code of Civil Procedure (Pavia vs. De la Rosa, 8 Phil., 70). With respect to the transcript of attorney Quirino's testimony, which is dealt with in the second assignment of error in the defendant's brief, it is of no importance, for whether or not this claim of the defendant's is proved, the plaintiff's are not responsible therefor, as we have just stated. Finding no error in the dispositive part of the judgment appealed from, it is hereby affirmed, without pronouncement as to costs in this instance. So ordered.

EN BANC G.R. No. L-30817 September 29, 1972 DOMINADOR DIZON, doing business under the firm name "Pawnshop of Dominador Dizon", petitioner, vs. LOURDES G. SUNTAY, respondent. Andres T. Velarde for petitioner. Rafael G. Suntay for respondent. FERNANDO, J.:p In essence there is nothing novel in this petition for review of a decision of the Court of Appeals affirming a lower court judgment sustaining the right of an owner of a diamond ring, respondent Lourdes G. Suntay, as against the claim of petitioner Dominador Dizon, who owns and operates a pawnshop. The diamond ring was turned over to a certain Clarita R. Sison, for sale on commission, along with other pieces of jewelry of respondent Suntay. It was then pledged to petitioner. Since what was done was violative of the terms of the agency, there was an attempt on her part to recover possession thereof from petitioner, who refused. She had to file an action then for its recovery. She was successful, as noted above, both in the lower court and thereafter in the Court of Appeals. She prevailed as she had in her favor the protection accorded by Article 559 of the Civil Code. 1 The matter was then elevated to us by petitioner. Ordinarily, our discretion would have been exercised against giving due course to such petition for review. The vigorous plea however, grounded on estoppel, by his counsel, Atty. Andres T. Velarde, persuaded us to act otherwise. After a careful perusal of the respective contentions of the parties, we fail to perceive any sufficient justification for a departure from the literal language of the applicable codal provision as uniformly interpreted by this Court in a number of decisions. The invocation of estoppel is therefore unavailing. We affirm. The statement of the case as well as the controlling facts may be found in the Court of Appeals decision penned by Justice Perez. Thus: "Plaintiff is the owner of a three-carat diamond ring valued at P5,500.00. On June 13, 1962, the plaintiff and Clarita R. Sison entered into a transaction wherein the plaintiff's ring was delivered to Clarita R. Sison for sale on commission. Upon receiving the ring, Clarita R. Sison executed and delivered to the plaintiff the receipt ... . The plaintiff had already previously known Clarita R. Sison as the latter is a close friend of the plaintiff's cousin and they had frequently met each other at the place of the plaintiff's said cousin. In fact, about one year before their transaction of June 13, 1962 took place, Clarita R. Sison received a piece of jewelry from the plaintiff to be sold for P500.00, and when it was sold, Clarita R. Sison gave the price to the plaintiff. After the lapse of a considerable time without Clarita R. Sison having returned to the plaintiff the latter's ring, the plaintiff made demands on Clarita R. Sison for the return of her ring but the latter could not comply with the demands because, without the knowledge of the plaintiff, on June 15, 1962 or three days after the ring abovementioned was received by Clarita R. Sison from the plaintiff, said ring was pledged by Melia Sison, niece of the husband of Clarita R. Sison, evidently in connivance with the latter, with the defendant's pawnshop for P2,600.00 ... ." 2 Then came this portion of the decision under review: "Since the plaintiff insistently demanded from Clarita R. Sison the return of her ring, the latter finally delivered to the former the pawnshop ticket ... which is the receipt of the pledge with the defendant's pawnshop of the plaintiff's ring. When the plaintiff found out that Clarita R. Sison pledged, she took steps to file a case of estafa against the latter with the fiscal's office. Subsequently thereafter, the plaintiff, through her lawyer, wrote a letter ... dated September 22, 1962, to the defendant asking for the delivery to the plaintiff of her ring pledged with defendant's pawnshop under pawnshop receipt serial-B No. 65606, dated June 15, 1962 ... . Since the defendant refused to return the ring, the plaintiff filed the present action with the Court of First Instance of Manila for the recovery of said ring, with P500.00 as attorney's fees and costs. The plaintiff asked for the provisional remedy of replevin by the delivery of the ring to her, upon her filing the requisite bond, pending the final determination of the action. The lower court issued the writ of replevin prayed for by plaintiff and the latter was able to take possession of the ring during the pendency of the action upon her filing the requisite bond." 3 It was then noted that the lower court rendered judgment declaring that plaintiff, now respondent Suntay, had the right to the possession of the ring in question. Petitioner Dizon, as defendant, sought to have the judgment reversed by the Court of Appeals. It did

him no good. The decision of May 19, 1969, now on review, affirmed the decision of the lower court. In the light of the facts as thus found by the Court of Appeals, wellnigh conclusive on use, with the applicable law being what it is, this petition for review cannot prosper. To repeat, the decision of the Court of Appeals stands. 1. There is a fairly recent restatement of the force and effect of the governing codal norm in De Gracia v. Court of Appeals. 4 Thus: "The controlling provision is Article 559 of the Civil Code. It reads thus: 'The possession of movable property acquired in good faith is equivalent to a title. Nevertheless, one who has lost any movable or has been unlawfully deprived thereof may recover it from the person in possession of the same. If the possessor of a movable lost of which the owner has been unlawfully deprived, has acquired it in good faith at a public sale, the owner cannot obtain its return without reimbursing the price paid therefor.' Respondent Angelina D. Guevara, having been unlawfully deprived of the diamond ring in question, was entitled to recover it from petitioner Consuelo S. de Garcia who was found in possession of the same. The only exception the law allows is when there is acquisition in good faith of the possessor at a public sale, in which case the owner cannot obtain its return without reimbursing the price. As authoritatively interpreted in Cruz v. Pahati, the right of the owner cannot be defeated even by proof that there was good faith in the acquisition by the possessor. There is a reiteration of this principle in Aznar v. Yapdiangco. Thus: 'Suffice it to say in this regard that the right of the owner to recover personal property acquired in good faith by another, is based on his being dispossessed without his consent. The common law principle that were one of two innocent persons must suffer by a fraud perpetrated by another, the law imposes the loss upon the party who, by his misplaced confidence, has enabled the fraud to be committed, cannot be applied in a case which is covered by an express provision of the new Civil Code, specifically Article 559. Between a common law principle and a statutory provision, the latter must prevail in this jurisdiction." " 5 2. It must have been a recognition of the compulsion exerted by the above authoritative precedents that must have caused petitioner to invoke the principle of estoppel. There is clearly a misapprehension. Such a contention is devoid of any persuasive force. Estoppel as known to the Rules of Court 6 and prior to that to the Court of Civil Procedure, 7 has its roots in equity. Good faith is its basis. 8 It is a response to the demands of moral right and natural justice. 9 For estoppel to exist though, it is indispensable that there be a declaration, act or omission by the party who is sought to be bound. Nor is this all. It is equally a requisite that he, who would claim the benefits of such a principle, must have altered his position, having been so intentionally and deliberately led to comport himself thus, by what was declared or what was done or failed to be done. If thereafter a litigation arises, the former would not be allowed to disown such act, declaration or omission. The principle comes into full play. It may successfully be relied upon. A court is to see to it then that there is no turning back on one's word or a repudiation of one's act. So it has been from our earliest decisions. As Justice Mapa pointed out in the first case, a 1905 decision, Rodriguez v. Martinez, 10 a party should not be permitted "to go against his own acts to the prejudice of [another]. Such a holding would be contrary to the most rudimentary principles of justice and law." 11 He is not, in the language of Justice Torres, in Irlanda v. Pitargue, 12 promulgated in 1912, "allowed to gainsay [his] own acts or deny rights which [he had] previously recognized." 13 Some of the later cases are to the effect that an unqualified and unconditional acceptance of an agreement forecloses a claim for interest not therein provided. 14 Equally so the circumstance that about a month after the date of the conveyance, one of the parties informed the other of his being a minor, according to Chief Justice Paras, "is of no moment, because [the former's] previous misrepresentation had already estopped him from disavowing the contract. 15 It is easily understandable why, under the circumstances disclosed, estoppel is a frail reed to hang on to. There was clearly the absence of an act or omission, as a result of which a position had been assumed by petitioner, who if such elements were not lacking, could not thereafter in law be prejudiced by his belief in what had been misrepresented to him. 16 As was put by Justice Labrador, "a person claimed to be estopped must have knowledge of the fact that his voluntary acts would deprive him of some rights because said voluntary acts are inconsistent with said rights." 17 To recapitulate, there is this pronouncement not so long ago, from the

pen of Justice Makalintal, who reaffirmed that estoppel "has its origin in equity and, being based on moral right and natural justice, finds applicability wherever and whenever the special circumstances of a case so demand." 18 How then can petitioner in all seriousness assert that his appeal finds support in the doctrine of estoppel? Neither the promptings of equity nor the mandates of moral right and natural justice come to his rescue. He is engaged in a business where presumably ordinary prudence would manifest itself to ascertain whether or not an individual who is offering a jewelry by way of a pledge is entitled to do so. If no such care be taken, perhaps because of the difficulty of resisting opportunity for profit, he should be the last to complain if thereafter the right of the true owner of such jewelry should be recognized. The law for this sound reason accords the latter protection. So it has always been since Varela v. Finnick, 19 a 1907 decision. According to Justice Torres: "In the present case not only has the ownership and the origin of the jewels misappropriated been unquestionably proven but also that the accused, acting fraudulently and in bad faith, disposed of them and pledged them contrary to agreement, with no right of ownership, and to the prejudice of the injured party, who was thereby illegally deprived of said jewels; therefore, in accordance with the provisions of article 464, the owner has an absolute right to recover the jewels from the possession of whosoever holds them, ... ." 20 There have been many other decisions to the same effect since then. At least nine may be cited. 21 Nor could any other outcome be expected, considering the civil code provisions both in the former Spanish legislation 22 and in the present Code. 23 Petitioner ought to have been on his guard before accepting the pledge in question. Evidently there was no such precaution availed of. He therefore, has only himself to blame for the fix he is now in. It would be to stretch the concept of estoppel to the breaking point if his contention were to prevail. Moreover, there should have been a realization on his part that courts are not likely to be impressed with a cry of distress emanating from one who is in a business authorized to impose a higher rate of interest precisely due to the greater risk assumed by him. A predicament of this nature then does not suffice to call for less than undeviating adherence to the literal terms of a codal provision. Moreover, while the activity he is engaged in is no doubt legal, it is not to be lost sight of that it thrives on taking advantage of the necessities precisely of that element of our population whose lives are blighted by extreme poverty. From whatever angle the question is viewed then, estoppel certainly cannot be justly invoked. WHEREFORE, the decision of the Court of Appeals of May 19, 1969 is affirmed, with costs against petitioner.

him." He concedes likewise that "our Code, following the Spanish code, uses broader language than that used in the French code" since our Code provides that the owner who has been "unlawfully deprived" of personal property may recover it from the possessor without reimbursement, with the sole exception where the possessor acquired the article in good faith at a public sale. 2 He thus concedes finally that "(T)here are writers who believe that the phrase 'unlawfully deprived' in our Code does not have the same meaning as stolen in the French code; that it is used in the general sense, and is not used in the specific sense of deprivation by robbery or theft. Under this view, it extends to all cases where there has been no valid transmission of ownership, including the case where the proprietor has entrusted the thing to a borrower, depositary, or lessee who has sold the same. It is believed that the owner in such case is undoubtedly unlawfully deprived of his property, and may recover the same from a possessor in good faith" (citing De Buen: 2-II Colin & Capitant 1008; 1 Bonet 234) 3 and cites the long unbroken line of decisions of the Court of Appeals and of this Court upholding the import of the broader language of the codal article in question. Indeed, if our legislature had intended to narrow the scope of the term "unlawfully deprived" to "stolen" as advocated by Tolentino, it certainly would have adopted and used such a narrower term rather than the broad language of article 464 of the old Spanish Civil Code with its long-established and accepted meaning in accordance with our jurisprudence. Petitioner's contentions at bar had long been disposed of in the Court's 1911 decision of Arenas vs. Raymundo, 4per Mr. Justice Florentino Torres, reiterating the doctrine of the earlier cases and holding that Even supposing that the defendant Raymundo had acted in good faith in accepting the pledge of the jewelry in litigation, even then he would not be entitled to retain it until the owner thereof reimburse him for the amount loaned to the embezzler, since the said owner of the jewelry, the plaintiff, did not make any contract with the pledgee, that would obligate him to pay the amount loaned to Perello, and the trial record does not disclose any evidence, even circumstantial, that the plaintiff Arenas consented to or had knowledge of the pledging of her jewelry in the pawnshop of the defendant. For this reason, and because Concepcion Perello was not the legitimate owner of the jewelry which she pledged to the defendant Raymundo, for a certain sum that she received from the latter as a loan, the contract of pledge entered into by both, is of course, null and void, and, consequently the jewelry so pawned can not serve as security for the payment of the sum loaned, nor can the latter be collected out of the value of the said jewelry. Article 1857 of the Civil Code prescribes as one of the essential requisites of the contracts of pledge and of mortgage, that the thing pledged or mortgaged must belong to the person who pledges or mortgages it. This essential requisite for the contract of pledge between Perello and the defendant being absent as the former was not the owner of the jewelry given in pledge, the contract is as devoid of value and force as if it had not been made, and as it was executed with marked violation of an express provision of the law, it can not confer upon the defendant any rights in the pledged jewelry, nor impose any obligation toward him on the part of the owner thereof, since the latter was deprived of her possession by means of the illegal pledging of the said jewelry, a criminal act. Between the supposed good faith of the defendant Raymundo and the undisputed good faith of the plaintiff Arenas, the owner of the jewelry, neither law nor justice permit that the latter, after being the

Separate Opinions TEEHANKEE, J., concurring: I concur in the main opinion of Mr. Justice Fernando, tracing and confirming the long settled and uniform jurisprudence since 1905 based on the express statutory provision of article 559 of our Civil Code (formerly article 464 of the old Civil Code) that the owner "who has lost any movable or has been unlawfully deprived thereof may recover it from the person in possession of the same," the only exception expressly provided in the codal article being that "if the possessor of a movable lost of which the owner has been unlawfully deprived, has acquired it in good faith at a public sale, the owner cannot obtain its return without reimbursing the price paid therefor." 1 Senator Tolentino's submittal in his commentaries on the Civil Code "that the better view is to consider 'unlawfully deprived' as limited to unlawful taking, such as theft or robbery, and should not include disposition through abuse of confidence. Thus, if the owner has entrusted personal property to a bailee, such as for transportation, pledge, loan or deposit, without transmitting ownership, and the latter alienates it to a third person who acquires it in good faith, the owner cannot recover it from such third person, "is, as he himself admits, based on the express provision of the French Code which allows the true owner of personal property to recover it from the possessor in good faith without reimbursement only "if it has been stolen from

victim of embezzlement, should have to choose one of the two extremes of a dilemma, both of which, without legal ground or reason, are injurious and prejudicial to her interests and rights, that is, she must either lose her jewelry or pay a large sum received by the embezzler as a loan from the defendant, when the plaintiff Arenas is not related to the latter by any legal or contractual bond out of which legal obligations arise. xxx xxx xxx The business of pawnshops, in exchange for the high and onerous interest which constitutes its enormous profits, is always exposed to the contingency of receiving in pledge or security for the loans, jewels and other articles that have been robbed, stolen, or embezzled from their legitimate owners; and as the owner of the pawnshop accepts the pledging of jewelry from the first bearer who offers the same and asks for money on it, without assuring himself whether such bearer is or is not the owner thereof, he can not, by such procedure, expect from the law better and more preferential protection than the owner of the jewels or other articles, who was deprived thereof by means of a crime and is entitled to be excused by the courts. Antonio Matute, the owner of another pawnshop, being convinced that he was wrong, refrained from appealing from the judgment wherein he was sentenced to return, without redemption, to the plaintiffs, another jewel of great value which had been pledged to him by the same Perello. He undoubtedly had in mind some of the previous decisions of this court, one of which was against himself. By the same token, the contention that the owner may recover the lost article of which he has been unlawfully deprived without reimbursement of the sum received by the embezzler from the pawnshop only after a criminal conviction of the embezzler, is to add a requirement that is not in the codal article and to unduly prejudice the victim of embezzlement, as pointed out by the Court in Arenas, supra. The civil action that the owner must resort to for the recovery of his personal property of which he has been unlawfully deprived as against the possessor (where the latter refuses to honor the claim, presumably on same valid doubts as to the genuineness of the claim) gives the possessor every adequate protection and opportunity to contest the owner's claim of recovery. The owner must therein establish by competent evidence his lawful claim, and show to the court's satisfaction his lawful ownership of the article claimed and that he had been unlawfully deprived thereof. I therefore find no reason to set aside the long settled interpretation given by our jurisprudence to article 559 (formerly article 464) of our Civil Code in accordance with its clear and unambiguous language, as reaffirmed in the case at bar.

EN BANC G.R. No. L-1748

June 1, 1906

THE BISHOP OF CEBU, REPRESENTING THE ROMAN CATHOLIC CHURCH, plaintiff-appellee, vs. MARIANO MANGARON, defendant-appellant. L.D. Hargis, for appellant. Hartigan, Marple, Solignac and Gutierrez, for appellee. PER CURIAM: The plaintiff in this case relates to a tract of land in the district of Ermita of this city, it is alleged is at present occupied by the defendant. The object of the original complaint was to recover the possession of the said land, while in the amended complaint the plaintiff prays that the said land be declared to be the property of the Catholic Church and that it be restored to the latter. Counsel for appellant admits in his brief that the object of the action is the recovery of possession when he refers to the judgment of the court below as being "in favor of the plaintiff in an action to recover the possession of certain real estate." (Record, p. 1.) Neither party has exhibited any title papers to the land in question nor pay other documentary proof. They have only offered certain parol evidence as to the former possession of the land and as to certain acts of ownership exercised by the parties over the same. The court below found (a) "that the defendant's parents and brothers had been in possession of the land in question until about the year 1887;" (b) "that it had not been clearly shown in what capacity they had occupied the lands;" (c) "that about the year 1887 the defendant and his relatives vacated the land by the virtue of an order from the municipality, which declared that the land was included within the zone of materiales fuertes (fire zone) and the houses in which they lived upon the said land without objection;" (d)"that after the land was vacated the parish priest of the Ermita Church fenced the land and cleaned the same without any objection whatsoever on the part of anyone; that the plaintiff claimed that this property had belonged to the Catholic Church from the time immemorial, the defendant, his parents and brothers having occupied a part thereof by the mere tolerance of the Catholic Church," (e) "that in the year 1898 the defendant, without the consent of anyone, entered upon the land in question and built thereon a nipa house and continued to live thereon without the consent of the parish priest of the Ermita Church or the plaintiff in third case." (Bill of exceptions, p. 11.) The court then ordered "that the defendants vacate the land described in the complaint and pay the costs of this action" (p. 12). Counsel appellant says in his brief "that the defendant claims to be owner of the land by inheritance." (Brief, p. 8.) It is not necessary for this court to apply to the present case the well-settled doctrine that it is not sufficient to allege a universal title of inheritance without showing the manner and form in which such title was converted into a singular title in favor of the person invoking the same, particularly where, as in the present, case, the question involved does not relate to the ownership of the property but rather to who has the better right to the possession of the same. But the court below suggest that there are several brothers of the defendant who might also claim the same right to occupy the land but who, however, had not done so. The court says "from the evidence introduced at the trial and from the fact that the defendant's brothers do not claim any right to the land in question, it seems that the claim of the plaintiff is the more credible." (Bill of exceptions, p. 11.) The complaint is directed against the illegal act of spoliation committed by the defendant in October, 1898, while as he himself says there was no priest in Ermita who could take care of the church and of the land in question, the American troops having occupied the parish house according to the defendant, and the Filipino troops having occupied it according to other witness. This is one of the points as to which there is no dispute between the parties, the defendant and the witnesses of both important details relating to this matter. Counsel for appellant sums up his brief in the following paragraph:

The defendant was the legal owner of the property when he was unlawfully ejected by the plaintiff in 1879, and we insist that he had a right to reenter upon the land when he did so, the time for prescription not having expired since he was ejected in 1879 (p. 8). Upon this point the court below said: "The occupation of the land by the defendant in the year 1898 was illegal, for, if her brought he had a right to the land, he should have applied to the courts for the possession of what belonged to him, and not proceed to occupy property claimed (he should have said possessed) by another against the will of the latter." The conclusion of law of the trial court is entirely in conformity with the conclusion would sanction the recovery of possession through violence or other unlawful and arbitrary means, and would permit a person to take the law into his own hands. "If a person thinks that he is entitled to the property which another possesses he should claim the same from the person in possession. If the latter accedes and voluntarily returns possession and acknowledges that the property does not belong to him, there is no necessity of any one interfering, but if the person in possession refuses to deliver the property, the one who believes himself to be entitled to it, however well founded his belief may be, can not take the law into his own hands but must seek the aid of the competent authorities." (4 Manresa, Commentaries on the Civil Code, p. 163.) The action of the defendant in 1898 was therefore absolutely unlawful. This possession held by the defendant in 1898 can not be added to the former possession, which was interrupted in 1877 by the order of the municipality, so as to consider such possession continous, the time intervening not being of sufficient duration to cover the statutory period of "a person who recovers possession according to law, which was improperly lost, is considered as having enjoyed it redound to his benefit." But in this case it appears (1) that it can not be affirmed that the possession enjoyed by the defendant was improperly lost; that possession ceased by virtue of an order from the municipality and no proof to the contrary has been offered on this point; (2) that it is impossible to say what was the nature of the possession prior to the year 1877 that is to say, whether it was held by right or by the mere tolerance of the plaintiff in this case. The code refers to the recovery of the possession, according to law, which was improperly lost, and to "recover according to law means through the proper writs and actions, or by requesting the aid of competent authorities in the special cases where the provisions of article 441 may apply." (4 Manresa, Commentaries on the Civil Code, p. 329.) "Of course," continues Manresa "the acts of violence or secrecy or mere tolerance can not affect the right of possession." Consequently the defendant in this case could never have lawfully and legally done what he did, to wit, to reenter upon the land which he had been ejected by the city of Manila. If the order of the municipality was illegal, and the possession was improperly lost, the defendant should have requested the assistance of the competent authorities to recover it. He should have applied to the executive or administrative officials, as the case might have been, or to the courts of justice in a plenary action for possession, for a year having elapsed since he was ejected from the premises, he could not maintain a summary action for possession. The legal provisions hereinbefore quoted would be sufficient ground upon which to base the confirmation of the decision of the trial court, but on account of the facts involved in this case a question of law has been raised by the members of this court which has not been urged by the parties themselves. It is absolutely necessary to decide this question, which naturally arises from the facts alleged in the complaint. The question is whether, after the promulgation of the Civil Code, the accion publiciana, which had for its object the recovery of possession in a plenary action before an action for the recovery of title could be instituted, still existed. It is well known that under the legislation prior to the Civil Code, both substantive and adjective, there were three remedies which a party unlawfully dispossessed could avail himself of, to wit: The accion interdictal, which could be brought within a year, in a summary proceeding; the plenary action for possession in an ordinary proceeding, which could only be brought after the expiration of a year; and the action for title in an ordinary proceeding, which was brought in case the plenary action for possession failed. The accion interdictal had for its object the recovery of the physicalpossession; the plenary action for possession, the better right to such possession; and the action for title, therecovery of the ownership.

We lay down as a conclusion that if the plaintiff, when he was deprived in October, 1898, of the possession which he had enjoyed quietly and peacefully for twenty years, more or less, had within a year instituted the accion interdictal, or summary action for possession, he would have been, necessarily and undoubtedly, restored to the possession of the land. It would have availed the defendant nothing to allege, as he now alleges, that he had merely recovered the possession which he improperly lost in 1877, when he dispossessed the plaintiff as he did. Any tribunal, in the same arbitrary manner in which the defendant dispossessed the party in possession, would have condemned the said defendant to return the possession to that party. But a year elapsed and the plaintiff brought this summary action for possession, and we also lay down as a conclusion that such summary action for possession could not be maintained, either under the old Code of Civil Procedure or under the new Code of Procedure in Civil Actions. (Laws 1 and 2, title 34 of the Novisima Recopilacion; art. 1635 of the Spanish Code of Civil Procedure and sec. 80 of the present Code of Procedure in Civil Actions.) This quiet and peaceful possession of twenty years, more or less, thus lost in a moment, could not be recovered in a summary action for possession after the expiration of one year, but possession could still be recovered through the accion publiciana, which involved the right to possess. This latter action would be then based upon the fact that he, having been in possession for twenty years, could not lose the same until he had been given an opportunity to be heard and had been defeated in an action in court by another with a better right. (The same laws.) This fact of itself would have been sufficient to recover the possession, not in summary, but in a plenary action, in which it would likewise have availed the defendant nothing to allege that all that he did was to recover a possession improperly lost in 1877. In one way or the other the plaintiff would have recovered such possession, in the first case the physical possession and in the second case the right to possess, which is not lost by the mere occupation of a third person, whether such occupation was effected violently, secretly, or arbitrarily. But the doubt which now exists is whether, after the promulgation of the Civil Code, the accion publiciana continued to exist. The doubt arises from the provisions of article 460 of the Civil Code, which reads as follows: The possessor may lose his possession 1. By the abandonment of the thing. 2. By transfer consideration. to another for a good or valuable

ownership of the property that is to say, to recover what belongs to him except where he is barred by the statute of limitations. There is no law fixing one year and one day as the period of prescription of such actions. Manresa expressly propounds this question and says: Meditation upon the nature of possession, being convinced as we are of the fact that possession constitutes a right, a right in rem, whenever it is exercised over real property or property rights, has merely served to strengthen as far as possible our conviction of the existence of the accion publiciana. We confess, willing to rely only upon a sound basis, that a doubt has occurred to us as to whether or not such action should be exercised by the possessor, as we find nothing definite upon which to place such reliance, although we have noticed that most of the authors admit that he should, and we know that where there is a right there is a cause of action. We have later seen this question raised and the proposition advanced that, although, as an exception to the general rule, such action is based upon equity, but as equity is not sufficient to allow the exercise of such action, it would be necessary to have a legal provision, an article in the code, establishing the same, a provision and an article which do not exist, and their nonexistence shows that there is no such thing as theaccion publiciana. That we have no knowledge of the existence of any legal text or recent provisions which expressly relate to such action, is true. The same thing is true in France. However, the majority of the authors admit its existence. Among us it existence is also generally admitted by the authorities on civil and procedural law. But we do not desire to base our conclusions upon the arguments of the authorities, particularly when we note that Sanchez Roman is the only one who has attempted to support in any way his conclusions. It is sufficient, says this author, that the right existing, there should be an action to protect it. There is no necessity of any special declaration in the Civil Code. We are of the same opinion as the author in question, but certainly not because we believe that if the possessor is deprived of the accion publiciana his right ceases to be a right in rem. In regard to this matter we refer to what we have already said in our preliminary consideration of the question of possession. In regard to this matter the idea is present in the code that possession should be considered as an actual right and it is so stated in various articles of that code, as for instance in article 438. It would be impossible to admit that a mere physical act would confer all the rights which a possessor ordinarily enjoys. Article 445 presupposes that possession may be considered either as de facto or de jure, for when it refers to controversies arising from the possession de facto, it clearly indicates that other controversies may arise which would not relate to the possession de facto. Further it can not be conceived that had its intent been different it should have preferred actual possession to any other possession. The article in question ends with the following significant words: "The thing shall be placed in deposit or judicial keeping until thepossession or ownership thereof is decided in the proper manner." That is to say, the question of fact can not be determined until the question of law has been decided either in regard to the ownership or in regard to the possession (pp. 220-221). Further, let us take another subject, for instance, the subject for easements. It was generally believed that the accion confesoria existed. Vain delusion! We have carefully examined all the provisions of the code relating to easements and we find absolutely nothing in regard to such an action. Then the accion confesoria is another error. It does not really exist. Then, if the owner of the dominant estate is

3. By the destruction or total loss of the thing or by the thing becoming unmarketable. 4. By the possession of another, over against the will of the former possessor, if the new possession has lasted more than one year. The last provision of this article has given rise to the doubt whether possession which is lost by the occupation of another against the will of the former possessor is merely possession de facto or possession de jure. The most powerful reason why it is thought that it refers to possession both de facto and de jure is that, whereas the two are equally lost in the manner indicated in the first three provisions of this article, it would be rather strange that the fourth provision should only refer to possession de facto. This, however, is not convincing because not only can the right of possession of any kind be lost in the aforesaid three ways, but the right of ownership as well. It could not be inferred from this, however, that the right of ownership can be lost in the fourth manner indicated. The legislation and the jurisprudence of all countries will allow a party after he has lost possession to bring an action to recover the

denied the use of the easement, it would not be because he has not a right to such use of it. The only thing that he has not is the action. No; such an absurdity can not be admitted. It is impossible to conceive that a person has a right which need not be respected by others, and such respect can not be exacted unless the law provides an adequate remedy for its enforcement. If a person has aright over any kind of property, such right would not be complete unless it could be enforced as against the whole world. The action is the recognition of the right; it is the weapon for its protection; the right certainly does not arise from the action, but on the contrary the action arises from the right. There is a right recognized by the code then this is sufficient! That right necessarily carries with it the action to enforce it, the lifegiving force. The action is, under this aspect, the actual enforcement of the right, and these two things are so closely allied that if the action is denied the right is also virtually and actually denied. the accion publiciana, therefore, exists, not for the sake of equity, but because it must necessarily exist if the right to possession exists or can exist as provided in article 445, and as is inferred from the other articles of the code dealing with this subject. There are not, in reality, any practical difficulties, for the courts consider as owners many who are simply possessors, and actions for title are maintained upon evidence which appears to be proof of ownership, but which in reality is not, for the reason that the title under which such ownership is claimed is not always in question, but merely its superiority over the claim of title of another. In a word, it is necessary to state the nature of the action but not the name by which it is known, and the claim being a just one, it is allowed in an action for title which in a multitude of cases would be nothing but an accion publiciana (plenary action for possession). Do not give the name of the action because it is not necessary; merely ask that the right be enforced. Who can reject the claim ? (Pages 223-224.) Paragraph 4 of article 460 is not an innovation in the Civil Code, nor does it mean the modification or reformation of the old law. Law 17, title 30 of the third Partida contains the same provision: "One who holds property can not lose the possession thereof except in one of the following manners: (1) If he is ejected from it by force; (2) if another person occupies in while he is absent and upon his return refuses him admission. . . . But although he may lose the possession in either of the aforesaid manners, he can, however, recover the same, and even the title thereto by an action in court." There is no doubt that paragraph 4 of article 460 is nothing but a repetition of the law in force prior to the Civil Code. He who loses possession in either of these ways may demand the return of the same in an action in court, as well as the ownership of the property, the glossator in expanding the word juiziowhich appears in the law, saying, "by means of an action, unde vi, namely, that of recovery, or by any such restorative means." So that the possession thus lost may be recovered not only in an action unde vi but some other restorative means, such as the accion publiciana or a penal action; this aside from an action for title. Law 2, title 34, book 11 of the "Novisima Recopilacion" contains in its title the following prohibitive provision: "No one shall be deprived of his possession until he has had an opportunity to be heard and his right is defeated in accordance with the law." As a legal precedent to paragraph 4 of article 460 we have law 3, title 8, of the same book 11, which says: "The laws of some cities provide that he who has been in possession of a building, vineyard, or other land for one year and one day, peacefully and adversely to the person claiming to be entitled to such possession who travels in and out of the village, shall not be held responsible therefor. There being doubt as to whether such possession for the period of one year and one day requires title in good faith, we, to dispell this doubt, do hereby order that he who holds such possession for the period of one year and one day shall not be exempt from liability therefor while in possession unless such possession of one year and one day was accompanied by title in good faith."

If the whole provision of article 460, paragraph 4, was contained in the old law and such was the meaning and efficacy that possession of one year and one day had under the said old law, the courts must give some satisfactory and convincing explanation why the meaning and efficacy of such possession of one year and one day referred to in the code should be different. We are unable to give such explanation, because in the act which was the basis of the present code nothing new was provided upon this subject, nor was any rule or procedure specified by which the various sections of the new law should be governed. Therefore the provisions of the code should be construed, as to the possession of one year and one day, as they were construed in the prior legislation, unless it appears that the intention of the legislature was otherwise that is to say, unless it appears that the said legislature intended exactly the contrary of what had been established preceding the enactment of the code. The right acquired by the person who has been in possession for one year and one day is the right that the former possessor lost by allowing the year and one day to expire. The right is lost by the prescription of the action. And the action which prescribes upon the expiration of the year is "the action to recover or to retain possession; " that is to say, the interdictory action. (Art. 1968, par. 1.) then the only right that can be acquired now, as before, by the person who was in possession for one year and one day is that he can not be made to answer in an interdictory action, but this is not so in a plenary action unless he had some title in good faith. The former possessor who had been in possession for twenty years, more or less, was considered as owner, and unless he was given an opportunity to be heard, and was defeated in law, he could not be deprived of such possession; and notwithstanding all this, and in spite of such prohibition, the maintenance of a possession wrongfully taken from the former possessor by a willful act of the actual possessor had to be sustained. The lessee, the depositary, the pledgee, the intruder, the usurper, the thief himself, after the expiration of a year would not be responsible for the possession of which the lawful possessor was wrongfully deprived, and if the latter could produce no evidence of his right of ownership the only thing that he could do according to the contrary theory it would be impossible for him to recover such possession thus lost by any other means. If, in addition to the fact of possession, the action for the enforcement of which prescribes after the expiration of one year and one day, there exists without any doubt whatsoever the right to possess (or more properly speaking in the case at bar, to continue to possess, which said right of possession would be a right in rem, such possession would not be on a less favorable footing than a mere possession de facto; and, if in the latter case the interdictory action lies, the action which existed prior to the enactment of the code, to wit, the accion publiciana, should continue to lie in the former case. The code establishes rights and the Law of civil Procedure prescribes actions for the protection of such rights, and we can not look to the code to find any provision defining the action which every civil right carries with it. This is the reason why as a title of chapter 3 of the code in which article 460 is included, and a sanction of the whole of title 5, book 2, which deals with possession, article 446 provides that every possessor has a right to be respected in his possession, and should he be disturbed therein, he must be protected or possession must be restored to him by the means established in the laws of procedure. The code refers to the laws of procedure enacted in Spain in 1881 and extended to the Philippines in 1888. Article 1635 of the old Code of Civil Procedure makes provision for summary proceedings to retain or to recover, to protect or to restore, possession, provided the action is brought within a year, but after the expiration of this period the party may bring such action as may be proper. This latter action, as has been explained before, may be either the plenary action for possession referred to or an action for title. This assumed, and reading article 1635 of the old Code of Civil Procedure immediately before article 446 of the Civil Code, we are unable to conceive how that could be successfully denied after the 8th of December, 1889, when the Civil code went into effect, which could not be denied prior to that date, to wit, the existence of the accion publiciana to recover the right of possession, to enforce the right to possess, which although it could not be brought within the year as a mere interdictory action for the protection of the mere physical possession, there can be no valid reason why it could not be brought after the expiration of the

year in order to protect the right and not the mere physical possession. Article 1635 of the old Code of Civil Procedure not having been repealed by the Civil Code, if the accion publiciana existed prior to its enactment, it must necessarily exist after such enactment. We consequently conclude that the action brought by the plaintiff in this case to recover the possession of which he was unlawfully deprived by the defendant can be properly maintained under the provisions of the present Civil Code considered as a substantive law, without prejudice to any right which he may have to the ownership of the property, which ownership he must necessarily establish in order to overcome the presumption of title which exist in favor of the lawful possessor, the plaintiff in this case, who had been in the quiet and peaceful possession of the land for twenty years, more or less, at the time he was wrongfully dispossessed by the defendant. Having reached this conclusion, the judgment of the court below is accordingly affirmed, with the cost of this action against the appellant. So ordered.